Frequently Asked Questions: Landlord Issues

Updated on March 27, 2020

Update: Governor Orders Moratorium on Evictions for Nonpayment of Rent and Halts Lock-Outs
 

On March 27, the governor issued an executive order banning the enforcement of eviction orders for renters affected by COVID-19 through May 31, 2020. The order prohibits landlords from evicting tenants for nonpayment of rent and prohibits enforcement of evictions by law enforcement or courts. It also requires tenants to declare in writing, no more than seven days after the rent comes due, that the tenant cannot pay all or part of their rent due to COVID-19.


The tenant would be required to retain documentation but not required to submit it to the landlord in advance. And the tenant would remain obligated to repay full rent in a timely manner and could still face eviction after the enforcement moratorium is lifted. The order takes effect immediately and provides immediate relief to tenants for whom rent is due on April 1st.  

Below, you will find answers to questions on:

 

Court Closures

How do lockout orders work when the courts are closed? 

Even before the statewide moratorium order was issued, nearly every county in California had temporarily closed their courts or limited their hours of operations for the rest of March or longer. The chief justice also issued an order on March 20, 2020, suspending all jury trials and civil hearings. At this time, courts are handling only limited types of matters and only on an emergency basis. The practical effect is that, even before the governor issued the moratorium order, Unlawful Detainer actions could not be filed, or would be postponed if already filed, and default judgments were not being processed. And even if a judgement ordering possession for the landlord had been obtained, many counties were not enforcing a lock-out orders (that is, a writ for possession). It is urged that you check your local courts to verify closures, hours of operation and types of cases being handled, as each court is different. 

 

 

Governor's Order of March 27: Moratorium on Evictions for Non-Payment of Rent During COVID-19

Does the order establishing a statewide moratorium on evictions halt all evictions?

 

No. It only halts those evictions based on nonpayment of rent for a COVID-19-related reason. It does not limit the right of the landlord to terminate a tenancy for any other reason. For example, a landlord would still be permitted to terminate a tenancy based on a tenant’s breach of a covenant of the lease, illegal activity on the property, or even, assuming the property is exempt from the statewide just cause eviction law, terminate a month-to-month tenancy without cause. 

 

Does the order apply to all residential tenancies?

 

It practically does. It applies to existing tenancies in which the tenant had previously paid rent prior to March 27, 2020. The order does not apply to new tenancies.

 

Does the order apply to commercial tenancies?

 

No. It only applies to residential tenancies.

 

So, if a landlord wants to evict for a reason other than nonpayment of rent, can they simply go ahead and file the eviction lawsuit based on a proper notice of termination?

 

No. Keep in mind that even before the statewide moratorium order was issued, nearly every county in California had temporarily closed their courts or limited their hours of operations for the rest of March or longer. The chief justice also issued an order on March 20, 2020, suspending all jury trials and civil hearings. At this time, courts are handling only limited types of matters and only on an emergency basis. The practical effect is that, even before the governor issued the moratorium order, Unlawful Detainer actions could not be filed, or would be postponed if already filed, and default judgments were not being processed. And even if a judgement ordering possession for the landlord had been obtained, many counties were not enforcing a lock-out orders (that is, a writ for possession). It is urged that you check your local courts to verify closures, hours of operation and types of cases being handled, as each court is different. 

The order only applies to a tenant who cannot pay the rent due to a COVID-19 related reason.

 

What types of COVID-19 related reasons would justify the tenant in not paying rent?

 

Examples of the types of reasons include:
 

  • The tenant couldn’t work because the tenant was sick with a suspected or confirmed case of COVID-19 or caring for a family member who was also suspected to be sick with COVID-19.

  • The tenant was laid off, lost hours or had income reduced due to COVID-19, the statewide emergency or any related government response.

  • The tenant needed to miss work to care for a child whose school was closed in response to COVID-19.

  • Any other reason where the inability to pay rent was due to COVID-19.
     

When is the tenant required to notify the landlord in writing that they are unable to pay the rent?
 

No later than seven days after the rent is due. Within that time, the tenant must inform the landlord in writing that the tenant needs to delay all or some portion of the rent due to COVID-19 reasons.
 

Is the tenant required to provide verifiable documentation?
 

Yes. However, this documentation only needs to be provided to the landlord on or before the tenant actually pays the back rent.
 

What counts as verifiable documentation?
 

Termination notices, payroll checks, pay stubs, bank statements, medical bills, or signed letters or statements from an employer or supervisor explaining the tenant’s changed financial circumstances.

 

Does this mean that the landlord will be waiving the right to collect all rent?

 

No. There is nothing in the order that limits the right of the landlord to eventually collect all the rent that is due. The tenant still owes the entire amount of unpaid rent.

 

If the tenant does not pay the rent due to a COVID-19 related reduction in income, can the money be deducted from the security deposit?
 

Yes. Under most leases, including C.A.R.’s residential lease agreement, any time rent is due and not paid, it may be deducted from the security deposit. 
 

What about lock-out orders?

 

Under the governor’s order, no lock-out of a tenant can take place as long as the tenant has met the rules as described above.

 

When does this order expire?

 

The order expires after May 31, 2020.

 

What about the various city and county rent moratoriums that have been enacted? Are they still in force, or does this order supersede them?

 

They are still in force. It’s true that the governor’s order states that it supersedes his prior order from March 16, 2020, but that’s only when there is a conflict with that prior order. The current order is intentionally quite narrow in its scope. All it really does is extend the period during which a tenant may file an answer to an Unlawful Detainer by 60 days and only when the tenant has not paid rent for a COVID-19 related reason. It makes no changes beyond that. On the hand the prior order was relatively broad in permitting a city or county to adopt stricter requirements pertaining to all aspects of the UD process.

It makes sense for the tenant to try to comply with the statewide order so that they get the benefit of it. But if they don’t, the drawback for the tenant is only that they don’t get an automatic 60-day extension on filing an answer in response to a UD complaint.

For example, if there is an local eviction moratorium ordinance that allows the tenant to notify the landlord within 14 days of the rent due date rather than seven, as under the governor’s order, and the tenant goes beyond the seven days, the tenant might still have an eviction defense under the ordinance, but the tenant would not get the benefit of the 60-day extension on the answer period.

City and County Eviction Moratoriums During COVID-19

The following questions pertain to city and county rent moratoriums only when a city or county has adopted such an ordinance. For the questions pertaining to the March 27, 2020, Governor’s order creating a statewide rent moratorium, see the above section.

Did the governor’s executive order from March 16, 2020, to protect renters impose a statewide moratorium on evictions?


No. The Governor’s Order from March 16, 2020, only provides a basis for a city or county to place restrictions on evictions and only when a tenant has not paid rent due to a COVID-19 related issue. These restrictions do not go into effect automatically. Each city/county must order its own restrictions. 


If a city/county has adopted such a restriction, does it prevent the landlord from evicting for causes other than non-payment of rent?


Even if a city/county did order such a restriction, it would not limit the right of the landlord to terminate tenancy for any other reason. For example, a landlord would still be permitted to terminate tenancy based on a tenant’s breach of a covenant of the lease, illegal activity on the property, assuming the property is exempt from the statewide just cause eviction law, terminate a month-to-month tenancy without cause. 

Which cities/counties have adopted such restrictions on evictions?


This list of cities/counties adopting such restrictions is being added to daily. Here is a list of cities/counties so far that have adopted COVID-19 eviction restrictions as of March 22, 2020: 

How exactly do these city/county restrictions on evictions operate? 


Each one is slightly different. So, in all cases, it is necessary to check the specific city/county order. But in general, if the city/county has adopted restrictions as authorized by the Governor, then evictions may be suspended when:
 

  • The basis of the eviction is nonpayment of rent;

  • The eviction arises out of a substantial decrease in household or business income;

  • It is caused by a COVID-19 related circumstance; and

  • It is documented.

 

Examples of a substantial decrease in household income may include:
 

  • A substantial reduction in income cause by layoffs or a reduction in the number of hours worked; or

  • A substantial decrease in business income cause by a reduction in opening hours or consumer demand; or

  • A substantial out of pocket medical expenses. 

 

If a tenant cannot pay the rent due to a COVID-19 related substantial reduction in income, do they still owe the rent?


Yes. Nothing in these city/county orders will relieve the tenant of the obligation to pay rent. However, many of the local orders will give the tenant up to six months to make up the back rent. Check your local city/county order.

How long are these orders in effect and can they apply retroactively?


Presently, they could be in effect through May 31, 2020, unless extended. However, it is possible that the city/county may have adopted a shorter time period. Also, the restrictions may apply retroactively. For example, they may apply to any notice to pay rent or quit served after March 1, 2020. 

If the tenant does not pay the rent due to a COVID-19 related reduction in income, can the money be deducted from the security deposit?


Yes. Under most leases, including C.A.R.’s residential lease agreement, any time rent is due and not paid, it may be deducted from the security deposit. 

Does the tenant have to prove by documentation how the substantial reduction in income was related to a COVID-19 related circumstance?


Yes. Eventually, this documentation must be produced. What’s not clear is whether such documentation must be produced at the time a three-day notice to pay rent or quit is served. Some ordinances are clear on this point and specify that the documentation must be presented to the landlord. Most however simply assert that a substantial reduction in income is an affirmative defense.

Do these city/county orders apply only to residential property?


No. They may apply to commercial property as well. 

Other COVID-19 Landlord-Related Issues

Is a tenant required to allow entry into a property for purposes of showing it when the tenant fears being exposed to the coronavirus? 


While California’s stay-at-home order in place, the answer is likely no. Since entering a property for purposes of showing it is prohibited under the stay-at-home order, (See C.A.R.’s Guidance on Stay-At-Home Order), a tenant’s objection to entry for fear of being exposed to the coronavirus would likely be deemed reasonable. Or a judge might invoke the clean hand’s doctrine noting that the action of entering the property itself may be illegal. (Affirmative defenses, legal or equitable, are permissible insofar as they would, if successful, preclude removal of the tenant from the premises. (Union Oil Co (1970)).)

However, when the statewide order to stay at home (or similar county orders) expires, as it eventually will, then the tenant would be required to allow entry. Except for the stay-at-home order, there is no law that would give the tenant the right to refuse entry based upon a fear that a prospective buyer might infect them with the coronavirus. If the tenant is refusing entry on this basis, then the agent may obtain a statement from the prospective buyer that they have no signs of any cold, flu or other respiratory illness. This may reassure the tenant. But whether or not such a statement is given to the tenant, the tenant would still be required to allow entry. 

In any event, regardless of whether the stay-at-home order is in place, the agent ultimately needs the cooperation of the tenant since the legal remedy against a tenant who refuses entry is to evict through an Unlawful Detainer action. This can be a lengthy and cumbersome process that most sellers are simply not going to undertake. 
 
Can a landlord evict a tenant who is suffering from the coronavirus?


No. The statewide just cause eviction law does not list infectious illness as one of the 15 just cause reasons on which an eviction may be based. But even if the property were exempt from the state just case eviction law, a landlord could not evict on this basis since it would likely constitute illegal discrimination.    
 
Does HUD’s recent letter placing a moratorium on foreclosures and evictions apply to landlords?


No. The order is intended to help borrowers with an “enterprise-backed mortgage” who are at risk of losing their home.

According to HUD, the guidance covers homeowners with FHA-insured Title II Single Family forward and Home Equity Conversion (reverse) mortgages. It directs mortgage servicers and lenders to:

  • Halt all new foreclosure actions and suspend all foreclosure actions currently in process; and

  • Cease all evictions of persons from FHA-insured single-family properties.

 

The moratorium regarding foreclosures is for a period of 60 days and to the completion of foreclosures in process. Similarly, evictions of persons from properties secured by FHA-insured single-family mortgages are also suspended for a period of 60 days. In addition, deadlines of the first legal action and reasonable diligence timelines are extended by 60 days.

_____________


 

This legal article is just one of the many legal publications and services offered by C.A.R. to its members. For a complete listing of C.A.R.'s legal products and services, please visit car.org/legal.

Readers who require specific advice should consult an attorney. C.A.R. members requiring legal assistance may contact C.A.R.'s Member Legal Hotline at (213) 739-8282, Monday through Friday, 9 a.m. to 6 p.m. and Saturday, 10 a.m. to 2 p.m. C.A.R. members who are broker-owners, office managers, or Designated REALTORS® may contact the Member Legal Hotline at (213) 739-8350 to receive expedited service. Members may also submit online requests to speak with an attorney on the Member Legal Hotline by going to http://www.car.org/helplines/legal-hotline-access/. Written correspondence should be addressed to:

CALIFORNIA ASSOCIATION OF REALTORS®
Member Legal Services
525 South Virgil Avenue
Los Angeles, CA 90020

The information contained herein is believed accurate as of March 25, 2020. It is intended to provide general answers to general questions and is not intended as a substitute for individual legal advice. Advice in specific situations may differ depending upon a wide variety of factors. Therefore, readers with specific legal questions should seek the advice of an attorney. Written by Robert Bloom, Esq.

Copyright© 2020 CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.). Permission is granted to C.A.R. members to reprint this material in hardcopy or PDF format only for personal use or with individual clients. This material may not be used or reproduced for commercial purposes. Other reproduction or use is strictly prohibited without the express written permission of the C.A.R Legal Department. All rights reserved.

 
 
 
 
 
 
 
 
 
 

2020 Copyright © CALIFORNIA ASSOCIATION OF REALTORS®. All Rights Reserved.  |  Terms & Conditions

CARlogo_Box_White.png