Our firm represents landlords in both commercial and residential leases. We regularly advise clients in the management of their property, including lease preparation and review, and resolution of tenant disputes. The majority of the statutes relating to landlords and tenants can be found in the California Civil Code, beginning with Title 5, Chapter 1, Section 1925. Below is a quick summary of the many legal issues facing landlords in both the residential and commercial context.
California has enacted several statutes dealing with the landlord/tenant relationship. In addition, some counties, but not all, have also enacted local ordinances dealing with the same. These statutes and ordinances address many of the issues facing landlords on a daily basis, such as: the respective responsibilities of the landlord and tenant; rent control; security deposits; assignments and subleases; lease terms; unlawful actions by landlords; demand, collection, or increase of rent; retaliation by landlord; rental application screening fees; termination of lease; abandonment by lessee and disposition of a tenant’s property remaining on the premises after the lease terminates.
Unfortunately, given the nature of the landlord/tenant relationship, it is not uncommon that landlords may be required to sue tenants for a variety of reasons. When the leased premises have already been vacated, it is usually just about money (e.g., unpaid rent). Damage to the property is another common claim, although the tenant is entitled to normal wear and tear. If the lease provides, the prevailing party can also be awarded its attorney’s fees. If the tenant has not yet moved out, the claim is usually for possession of the property, and the rent is secondary. If the landlord wins, he or she can be awarded judgment for the rental value, court costs, and attorney’s fees.
Tenants may sue because the owner has not made necessary repairs or similar breach of habitability claims; has retaliated against them in some manner for exercising their legitimate rights as tenants; has charged an illegal rent increase; has improperly implemented an eviction; or has attempted a wrongful eviction. Our lawyers help tenants bring wrongful eviction claims when the former tenant believes the owner acted in bad faith in order to get tenants to move out; for example, evicting for reason of an owner-move-in when the owner did not then move in or lived in the building for only a short time.
People may also sue landlords for rental discrimination on the basis of race, ethnicity, gender, sexual orientation, or family size. Economic discrimination is allowable to determine who has the ability to pay rent, but the source of income is not a legitimate basis for excluding an applicant.
In most cities and counties in California, a month-to-month tenancy can be terminated by the landlord with no reason given. However, a landlord cannot sue to evict a tenant who is still within his lease term unless the tenant is somehow violating the lease. Examples are when the rent has not been paid or there is some other serious breach of the rental agreement. The case begins with a three-day notice to either pay rent (or comply with lease terms) or vacate the premises. But if the landlord wants to move into the unit, he cannot begin the proceedings until the lease expires. If the tenancy is on a month-to-month basis, he can serve a thirty-day notice to terminate the tenancy. But regardless of the reason for the eviction, whether by reason of nonpayment of rent, breach of a lease covenant, or nuisance, it is the landlord who always bears the burden of proof.
Commercial landlord/tenant law is very different from residential landlord/tenant law. Many rights given to the residential tenant do not exist for the commercial tenant. Many businesses make serious mistakes applying laws which work for residences but do not apply with businesses. These mistakes can be very costly and could result in the loss of one's business. Great care must be taken in these matters.
With respect to landlord/tenant disputes, most claims brought by landlords against residential tenants are commonly also brought against commercial tenants. For the most part, the rules are the same. There is, however, no rent or eviction control in California for commercial tenancies (unless the landlord knew that the tenant was going to reside on the premises). In addition, in most commercial situations the courts will uphold the lease, even when it is unfair and/or unreasonable. The general "automatic" or implied protections found in residential tenancies simply do not exist in these situations.
Different Rules For Commercial Tenancies:
The tenant may rent a space that is unusable for their business but they will still be required to pay rent.Contrary to what some landlords/agents say, there is no single "standard" commercial lease.
There is no implied right of habitability
There is no statutory right to "repair and deduct" for property defects
The 10% 60 day rent raise rule does not apply
Statutory penalties for turning off utilities or changing locks (CC 789.3) do not apply
There is no limit to the amount of security deposit charged.
The privacy protections of entry by landlord laws (CC 1954) do not apply.
Landlords can accept a partial rent payment during an eviction and still successfully proceed with that eviction.
Landlords can ask for too much rent in a 3 day notice to pay rent or quit and still successfully proceed with the eviction.
Late charges which are excessive in residential tenancies may be acceptable for commercial ones.
Landlords may shift maintenance responsibilities to the tenant.
Many unwaivable rights in residential tenancies may be waived in commercial ones.
Tenants may waive litigation rights including a trial by jury.
Assignments and subleases may be prohibited.
Landlords may restrict the tenant's use of the property even if it is an unreasonable.
Barron & Associates
3478 Buskirk Avenue
Pleasant Hill, CA 94523