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Legal Q & A by Richard Beckman

Posted on 01. Apr, 2018 by in all, Magazine Articles

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Question 1: If a prospective tenant asks us if we accept Section 8, is it legal to say no? Can you tell me the positive and negative points on Section 8? Our property is in Petaluma.Answer 1: The expression “Section 8” likely conjures up many images for landlords. For some, it means low-income tenants, payment problems, government bureaucracy and regulation. For others, it means a large pool of tenants, regular monthly rent payments from a local housing authority and stability. For some, it might even mean something beyond a sheer business decision, involving contribution to the housing opportunities of persons less well-off than the average renter. But what it rarely brings to mind is ‘mandatory.’ Judging from the anecdotal responses this writer has received, most landlords believe that participation in the Section 8 program is voluntary on the landlord’s part, and that they can not be compelled, forced or required to accept an applicant who relies on the Section 8 voucher program for part or all of the rent.

At this point, it is not completely clear if telling an applicant you do not accept Section 8 is permitted. The general legal view is that it remains ‘ok’ to reject an applicant on that basis, and under federal law that seems to remain the case.

State law has muddied the waters a bit, by allowing a Section 8 applicant to claim a reasonable accommodation requires accepting Section 8 (in cases where the tenant receives the housing subsidy due to a disability). However, in such cases, the applicant would likely need to request the reasonable accommodation, at which point the landlord can have the situation more carefully reviewed by counsel.

In San Francisco, there is a law that says landlords may not reject an applicant based on Section 8 as the tenant’s ‘source of funds,’ but that law has not to my knowledge been reviewed at the appellate level to determine if it is valid or invalid (based on the issue of ‘preemption). I don’t know (though I doubt) if Petaluma has a similar local law.

I wrote an article several years ago that provided an in-depth review of Section 8 issues at the time. It is mostly still accurate. If a reader would like a copy of that article, please contact me and I will provide it. It is too lengthy to repeat here.

 

Question 2: I was wondering if there is a legal downside to asking a renter to sign up for an “auto pay” service to pay the rent. In the event the account is not funded at some point and as a landlord I begin to stop receiving payments, would it be more difficult to prove in a legal proceeding?
Answer 2: There is no rule against asking the tenant to pay rent by direct deposit, or offering the tenant that option, as long as you comply with Civil Code 1947.3.

According to Civil Code Section 1947.3, the landlord shall allow a tenant to pay rent (and security deposit) by at least one form of payment that is neither cash nor electronic funds transfer (i.e. check or money order or credit card). This option does not apply if the tenant has previously ‘bounced’ a rent or deposit check. In that event, the landlord may demand or require cash as the exclusive form of payment, but only for a period not exceeding three months following an attempt to pay with a check on insufficient funds (or following a tenant’s instruction to stop payment).

If the landlord chooses to require cash payment under these circumstances, the landlord shall give the tenant a written notice stating that the payment instrument was dishonored and informing the tenant that the tenant shall pay in cash for a period determined by the landlord, not to exceed three months, and attach a copy of the dishonored instrument to the notice.

Please note that the notice shall comply with Section 827 if demanding or requiring payment in cash constitutes a change in the terms of the lease.

The tenant and landlord or agent may mutually agree that rent payments may be made in cash or by electronic funds transfer, so long as another form of payment is also authorized, subject to the requirements of subdivision (a).

As for evidence of non-payment, while paper evidence is almost always preferred, the landlord’s testimony that the tenant did not pay the rent – whether because it was never tendered, the check bounced, or the electronic deposit did not take place – will likely be the most persuasive evidence, and which the tenant will have to disprove if he or she can.

 

Question 3:  My wife and I own a four unit apartment building in San Francisco (under rent control). All units were rented out in different times and in different rental rates in last seven years. I moved out from one of the units since 2013. If I need move back into this apartment building, which unit can I move in to? What will the cost and what is the procedure for legal eviction? How long will it take? After that, how long do I have to live there before I move out again? Thanks!
Answer 3: Your question is beyond the scope of the AOA Q&A forum, which does not allow for specific legal advice on a specific matter. But generally, if you did not use the ‘Owner Move-in’ eviction route when you lived there before, and no other owner has done so, you can claim whichever unit you prefer (the rent ordinance limits owner move in evictions to one per building, and the same unit if a prior OMI eviction took place, subject to a petition to the rent board to evict from a different unit). An OMI action assumes you qualify to do an ‘owner move in’ eviction, which generally requires at least a 25% ownership interest in the buiding, and the good faith intent to make the selected unit your primary residence for at least the next three years, and that you are not acting with an ulterior motive. For example, if you tesified that you did intend to live there for the next three years, but that your main goal was to evict a troublesome tenant, you would lose at trial because your ‘dominant motive’ was not to make the unit your home, but to get the tenant out.

The cost and time is too varied to discuss in this forum, but with a typical 60 day termination notice reqiured, and relocation payments to the tenants, it can exceed three months and $20,000 in required relocation payments alone. Depending on the tenant’s circumstances (long-term, low income, minor children, disabled, etc.) you may meet more or less resistance to an eviction effort. However, those issues are more properly addressed by competent counsel should you believe an owner move in effort is an option.

 

Question 4: Can an owner require all tenants to carry and maintain renter’s insurance? If the lease requires a tenant to carry renter’s insurance and there is a fire, is the owner responsible to pay for a hotel or would it be the tenant’s responsibility?
Answer 4: Interestingly, a court case came out recently which held that while the lease can require the tenant to have renter’s insurance, the tenant’s breach of that lease provision is not a basis to terminate the tenancy. So, in effect, there is no penalty for the tenant not having insurance in breach of the lease. A bit weird, but that’s the state of the law on that issue.

If the fire was not the tenant’s fault, then ordinarily the landlord would be responsible for providing alternate housing for the tenant in certain situations. If the unit was destroyed, that terminates the tenancy, but if it was only made uninhabitable, then the tenant is entitled to assistance with temporary housing. And, because insurance is for the benefit of the insured, not the landlord, the tenant’s failure to have it probably would not change that analysis.

 

Question 5:     What can landlord do when tenant refused to sign a tenant estoppel certificate? Can we evict?  Can we force the tenant to sign? Thank you very much.
Answer 5: There is no general obligation that a tenant complies with a request to complete an estoppel certificate. In such cases, the owner could send the tenant a completed statement that has what the owner believes to be the tenant’s correct information, with a statement that if the tenant does not make any changes, the information will be deemed true and current.

If the lease requires the tenant to comply with a request for an estoppel statement, then that provision can be enforced with a three day notice to cure or quit.  In that situation, the owner might attach the estoppel statement to the 3 Day Notice and direct the tenant to complete it as best they can and return it within the three day period.

 

Question 6: Who is responsible for unclogging a clogged kitchen sink? Tenant has lived in the unit two to three years. Is this a case of tenant misuse?
Answer 6:    The question of who is responsible for repairs is the same as who is responsible for the problem. If the tenant caused the problem by misuse, then the tenant is responsible for the cost of repair. The trouble of course is establishing that fact. The tenant will say it is the ‘pipes’ etc., so a plumber will likely be the best person to try to answer that question. However, ultimately if the tenant refuses to accept responsibility, then it becomes a disputed fact issue. While a three day notice to cure or quit may be an option, it might be best to proceed via small claims to get the repairs cost reimbursed if the evidence of the tenant’s fault is strong.

 

Question 7: I have rental homes in Encinitas, CA, Kings Beach, CA, and Reno, NV, and a four unit apartment in Kings Beach, CA.  Can you please advise me on the legality of my lease renewal procedure, and/or improve it. I prefer long-term tenants and charge more for lease terms of less than one year. I mail a lease renewal offer and a rent increase notice, of the amount of a month-month lease, 2-1/2 months before the end of their current lease. The lease renewal offer explains that if they get a signed one-year lease extension amendment back to me one month and 10 days before the end of their current lease, the rent increase will be a lessor amount or none at all (the specific amounts and options are on the lease renewal offer). This gives me time to send another rent increase notice with the lessor amount.  This incentivizes them to renew for one1 year and return the paper work in a timely manner. Thanks for your help.
Answer 7: There is no legal impediment to charging long-term tenants less rent as an inducement to enter into the term lease rather than month to month. You could just require a one year renewal of all tenants, but your version is fine too.

 

Question 8: I have a tenant in a Hayward studio apartment. She has a 38-year-old son who she says has become ill. She claims that her son can move in with her, stay indefinitely (even through the rental agreement says otherwise) and there is nothing the landlord can do about it. Is there any law regarding ill adult family members being able to move into an apartment without landlord approval?

Answer 8: The Hayward rent ordinance, unlike its counterpart in cities such as San Francisco, does not have a specific provision dealing with tenants who bring in family members without the owner’s permission. So, your lease – if it specifies the unit is to be solely occupied by one person – may (I repeat may) be used to enforce that restriction on the son’s occupancy. However, that provision may also lead to charges of discrimination based on family, in that if the unit was restricted at the marketing phase to one occupant, courts have found such limitations to defeat the ability of a family unit to occupy the rental unit, which is deemed familial discrimination.

A court could also ask the question why would you want to prevent the tenant from having her ill adult child live with her? But if you insist on enforcing that provision, you should probably consult with local counsel familiar with the Hayward rent ordinance.

 

Question 9: Did a court recently uphold the San Francisco rent ordinance owner move in restriction on evictions during the school year?

Answer 9: Yes. The local court of appeal considered the property owner’s argument that the San Francisco Rent Ordinance provision that prevented ‘owner move in’ evictions of any family with a minor that would take place during the school year was illegal. That provision had been challenged as violating state constitutional protections, by being ‘preempted’ by state unlawful detainer laws. However, the First District panel decided those arguments were not persuasive, and allowed that local law to remain in effect. (The case may be read at San Francisco Apartment Assn. v. City and County of San Francisco, 2018 Cal. App. LEXIS 122.)

The ordinance section at issue was San Francisco Administrative Code section 37.9, subdivision (j)(1), which provides: “It shall be a defense to an eviction under Sections 37.9(a)(8) [owner move-in], (a)(9) [condominium conversion], (a)(10) [permanent removal of the unit from housing use], (a)(11) [capital improvements ], or (a)(12) [substantial rehabilitation] if a child under the age of 18 or any educator resides in the unit, the child or educator is a tenant in the unit or has a custodial or family relationship with a tenant in the unit, the tenant has resided in the unit for 12 months or more, and the effective date of the notice of termination of tenancy falls during the school year.” (S.F. Admin. Code, § 37.9.)