When rental relationships sour, even the most conscientious investment property owners can be slapped with a lawsuit that may cost tens of thousands of dollars to defend against regardless of the merits of the case. In our 23 plus years, we at Bornstein Law have seen some reprehensible conduct by landlords that invites litigation, and the menagerie of shocking abuses inevitably finds its way into the headlines. When investment property owner’s house tenants in squalid firetraps, bully elderly residents, or relegate vulnerable tenants to a subterranean dungeon, such lawsuits are indefensible.
Responsible landlords with a sound moral compass tend to look at these egregious cases and develop a misplaced sense of confidence, reasoning that because they treat their tenants well and are good stewards of their property, they will not be exposed to financial and legal liability. In fact, most of the tenant lawsuits we encounter arise from a multitude of simple oversights, a naiveté about rent control laws, or an overzealousness of landlords to take matters into their own hands with “self-help” evictions or menacing behavior that serves to harass problematic tenants.
Given the potential spoils of victories, there is no shortage of enterprising tenant attorneys wanting to assist disgruntled residents in evening the score. This is especially true when the tenant is displaced, and the stakes are ratcheted up if the aggrieved tenant is in a rent-controlled jurisdiction, where rent boards are all too willing to right a perceived wrong.
We have been ambassadors for wrongful eviction coverage, noting that tenant lawsuits are proliferating throughout the Bay Area. We would be remiss not to qualify that statement with a summary of potential suits that a landlord can face in a failed tenant relationship, so we outline some common ones here.
When a tenant claims that he or she is displaced through the improper conduct of the landlord, this can be a costly endeavor. The tenant often seeks rent differential damages, the difference between the former tenant’s monthly rent and the actual rental value of the unit. For example, let’s say a tenant who is paying $2,500 in a rent-controlled apartment is wrongfully evicted. Assuming the current monthly rental value is $4,500, there is a rent differential of $2,000. A tenant can argue that were it not for the improper conduct of the landlord, he or she would have remained in the apartment for five years and, doing the arithmetic, the differential damages are $120,000. Other potential damages may include moving costs, statutory relocation fees, and compensation for the emotional distress of being uprooted.
Breach of Covenant of Quiet Enjoyment
Implied in every lease, and codified in Civil Code §1927, is a covenant of quiet enjoyment, guaranteeing that tenants will be able to peacefully enjoy their homes. Essentially, the tenant has a right to reasonably occupy the dwelling peacefully and without recurring disruption.
But “quiet enjoyment” also includes the right to exclude others from the premises, the right to clean premises, and the right to basic services such as heat and hot water. When a tenant claims that the landlord has interfered with these rights, action can be brought against the landlord for breach of the covenant of quiet enjoyment. The tenant may elect to remain in the unit and sue the landlord.
The tenant may also commence a lawsuit for emotional distress suffered because of a landlord’s misconduct or harassing behavior, whether the infliction of anguish was intentional or a result of negligence. In cities that have implemented rent control policies of varying degrees, landlords may also be liable for damages that occur from violations of the respective ordinances.
Triple the Trouble?
Enter treble damages in certain locales that triple the damages in a punitive measure to discourage improper landlord conduct and the potential liability is amplified, not to mention attorney’s fees for which a landlord can be on the hook. An ounce of prevention is worth a pound of cure. Your overarching goal should be to avoid or resolve conflict so that your rental business does not have to defend against lawsuits. Managing a landlord-tenant dispute is like a knot – the harder each side tries to win, the less likely the knot is untangled. Untangle the matter so that the conflict is not enlarged. In an era when political rhetoric and tenant protections neglect the rights of property owners, you must be able to count on your attorney’s expert legal counsel and staunch advocacy in the courtroom or in front of the local rent board in order to level the playing field.
Daniel Bornstein, Esq., founder of Bornstein Law, specializes in complex real estate litigation and landlord-tenant disputes. He may be contacted at (415) 409-7611 or [email protected].