On June 28, 2021, Governor Newsom passed into law Assembly Bill No. 832, which amended and extended certain restrictions of the previously passed Senate Bill No. 91 and Assembly Bill No. 3088, which created the “COVID-19 Tenant Relief Act” and the “COVID-19 Small Landlord and Homeowner Relief Act.” This blog is intended to highlight important information you should be aware of and help provide clarity of such restrictions.
(1) How can I recover the unpaid COVID rental debt my tenant owes?
A landlord cannot initiate an unlawful detainer action or serve notices of termination of a tenancy (except for limited reasons below) until October 1, 2021.
If the tenant signed and returned a declaration of hardship under penalty of perjury that they are unable to pay due to financial difficulty directly related to COVID for any rent due and owing between March 1, 2020 through August 31, 2020, the tenant can NEVER be evicted due to the non payment of rent since this time period is deemed to be a “protected time period”. The only recourse to recover the debt is through Small Claims Court (described below).
If the tenant signed and returned a declaration of hardship under penalty of perjury that they are unable to pay due to financial difficulty directly related to COVID for any rent due and owing between September 1, 2020 through September 30, 2021, AND the tenant pays at least 25% of the total rent due during that period by September 30, 2021, the tenant can NEVER be evicted due to the non payment of rent since this time period is deemed to be a “transition time period.” The only recourse to recover the debt is through Small Claims Court (described below).
For all unpaid COVID rent accruing from March 1, 2020 through September 30, 2021, the landlord will have to file suit in Small Claims Court in the County in which the property is located to recover this rental debt on or after November 1, 2021. The Small Claims Court $10,000 cap for damages has been lifted for purposes of these suits to recover COVID rental debt. An owner will have 4 years to file this lawsuit to recover the debt against the tenant.
(2) What Notices have to be served on my tenants?
All tenants must be served with a NEW 15-day Notice to Pay or Quit (excluding Saturday, Sunday and other judicial holidays) on or before July 31, 2021 for unpaid rent accruing between September 1, 2020 and September 30, 2021. (*Note that there is a separate 15 Day Notice for unpaid rent due between March 1, 2020 – August 31, 2020 which is the “protected time period”). When serving the tenant with the new 15-day Notice, the landlord must attach an unsigned copy of the COVID-19 financial hardship declaration (even if the tenant had previously signed and returned it). If the tenant pays at least 25% of the rent due between September 1, 2020 and September 30, 2021 on or before September 30, 2021, the tenant cannot be evicted at any time due to the remaining unpaid rent. Please note that the law does not require that this 25% amount be paid monthly, it can be paid as a lump sum on September 30, 2021 to satisfy the requirements of the law.
As part of the new law, the landlord must also make a good faith effort to investigate whether governmental rental assistance is available to the tenant and seek governmental rental assistance on behalf of the tenant or cooperate with the tenant in obtaining rental assistance. Under the new expanded law, the landlord will be entitled to receive 100% of the unpaid rent due from April 1, 2020 – March 31, 2021 from the governmental assistance payment. For the tenant to qualify for rental assistance, the tenant must fall 80% below the Area Median Income for the county in which the property is located. Go to http://housingiskey.com or call 1-833-422-4255 to find out more information on the state and local rental assistance programs.
(3) What reasons can an Owner use to terminate a lease right now?
AB 832 applies to ALL residential leases, even those that were previously exempt from state rent control laws. Leases can only be terminated for limited purposes under AB 832 set forth below (same rules as previous SB 91). PLEASE NOTE THAT IF THE CITY OR COUNTY WHERE YOUR PROPERTY IS LOCATED HAS MORE RESTRICTIVE COVID EVICTION PROTECTIONS (ie/ San Francisco County, Los Angeles County, Alameda County, San Diego County just to name a few) YOU STILL MAY NOT BE ABLE TO EVICT FOR ANY REASON UNTIL THE LOCAL MORATORIUM LIFTS REGARDLESS OF STATE LAW.
Reasons you can terminate a lease under AB 832:
- An at-fault just cause for eviction, as defined in Civil Code Section 1946.2(b)(1); (a) Default in the payment of rent. (b) A breach of a material term of the lease after being issued a written notice to correct the violation. (c) Maintaining, committing, or permitting the maintenance or commission of a nuisance as described in paragraph (4) of Section 1161 of the Code of Civil Procedure. (d) Committing waste as described in paragraph (4) of Section 1161 of the Code of Civil Procedure. (e)The tenant had a written lease that terminated on or after January 1, 2020, and after a written request or demand from the owner, the tenant has refused to execute a written extension or renewal of the lease for an additional term of similar duration with similar provisions, provided that those terms do not violate this section or any other provision of law. (f) Criminal activity by the tenant on the residential real property, including any common areas, or any criminal activity or criminal threat, as defined in subdivision (a) of Section 422 of the Penal Code, on or off the residential real property, that is directed at any owner or agent of the owner of the residential real property. (g) Assigning or subletting the premises in violation of the tenant’s lease, as described in paragraph (4) of Section 1161 of the Code of Civil Procedure. (h) The tenant’s refusal to allow the owner to enter the residential real property as authorized by Sections 1101.5 and 1954 of this code, and Sections 13113.7 and 17926.1 of the Health and Safety Code. (i) Using the premises for an unlawful purpose as described in paragraph (4) of Section 1161 of the Code of Civil Procedure. (j) The employee, agent, or licensee’s failure to vacate after their termination as an employee, agent, or a licensee as described in paragraph (1) of Section 1161 of the Code of Civil Procedure. (k) When the tenant fails to deliver possession of the residential real property after providing the owner written notice as provided in Section 1946 of the tenant’s intention to terminate the hiring of the real property, or makes a written offer to surrender that is accepted in writing by the landlord, but fails to deliver possession at the time specified in that written notice as described in paragraph (5) of Section 1161 of the Code of Civil Procedure.
- A no-fault just cause for eviction, as defined in Civil Code Section 1946.2(b)(2), except that specified extra conditions apply to unlawful detainer cases based on intent to demolish or to substantially remodel the residential real property.
- The owner’s removal of the property from the rental market permanently.
- Owner or owner’s family intent to move back in.
- The property is for sale and in escrow and the buyer intends to move in as their primary residence.
- Government requires it, or there are severe habitability issues that must be fixed.
- A substantial remodel (longer than 30 days) of the property to repair habitability issues. This will not apply to a cosmetic remodel or a remodel that does not directly affect health or safety issues.
NOTE: If the landlord terminates a lease for any No-Fault Just Cause reason under Section 2 above, the landlord cannot collect any unpaid COVID-19 rental debt. Also, any terminations under Section 2 for no fault just cause may also require the landlord pay the tenant a relocation assistance payment (however this can be offset against the unpaid rent).
Local Eviction Moratoriums:
- Alameda County Eviction Moratorium – prevents ALL evictions or lease terminations except for (1) owner taking unit off rental market per the Ellis Act, (2) unit must be vacated to comply with govt order, or (3) health and safety issues, and is in effect until 60 days after local state of emergency lifts (local state of emergency still in effect as of today).
- Contra Costa County Eviction Moratorium – prevents ALL evictions or lease terminations except for (1) health and safety issues, (2) if owner or member of owner’s immediate family intends to occupy property, or (3) if owner removing property from rental market per Ellis Act until September 30, 2021.
- Los Angeles County Eviction Moratorium – prevents ALL evictions or lease terminations except for (1) owner who purchased a single-family home on or before June 30, 2021 intends to move in and use it as their principal residence for at least 36 consecutive months, until September 30, 2021.
- San Diego County Eviction Moratorium – prevents ALL evictions or lease terminations except for imminent threat to health or safety issues until August 14, 2021.
- San Francisco County Eviction Moratorium – prevents ALL evictions or lease terminations except for (1) health and safety issues, (2) violence/threats of violence or (3) if owner taking unit off rental under Ellis Act until September 30, 2021.
*This list of local COVID eviction moratoriums above is not exhaustive. Please check your local city or county websites for additional information on the status of the moratorium.
*This article is intended for informational purposes only and does not constitute legal advice. It is specific to the laws of the State of California. For specific questions related to this article, please contact the Law Office of Ashley M. Peterson.