The following is a legal alert that was shared with us from Kimball, Tirey & St. John LLP
The original article can be found here.
Legal Alert
CDC Eviction Moratorium: What California Landlords Need to Know
September 22, 2020
On August 31, 2020, the Governor signed the COVID-19 Tenant Relief Act (AB 3088) into law. A few days later, the CDC announced a nationwide eviction moratorium which officially took effect on September 4, 2020. That same day information about the CDC eviction moratorium was made public, Governor Newsom held a press conference wherein he said that the CDC eviction moratorium did not apply in California because AB 3088 provided more protection to California residents.
The CDC has never declared an eviction moratorium in the history of the United States. Therefore, it was unclear what would happen after the Governor’s announcement. Was there going to be a formal process by which California would be classified as exempt from the CDC moratorium? What kind of official confirmation would be forthcoming to assure California landlords that the CDC order did not legally apply in this state?
Unfortunately, since the CDC order was enacted, there has not been any official confirmation by the federal government that California is exempt. Moreover, tenants’ rights groups are adamant that the CDC order applies in California. Judges are also questioning whether the CDC moratorium applies in California (and some have already taken the position that it does). Moreover, the Judicial Council is proposing a new court document which requires landlords to disclose whether a tenant in each unlawful detainer case has submitted a CDC declaration prior to the filing of the unlawful detainer (which, however, has yet to be adopted as of the date of this Legal Alert). The Judicial Council’s action further indicates that California may not be exempt.
In light of the above, and until such time as we obtain some kind of official “waiver” indicating that California is exempt from the CDC order, landlords should proceed with caution until the CDC order expires on December 31, 2020, in order to avoid penalties from $100,000 to $500,000 for a single violation in addition to potential jail time.
In many ways, the Governor’s statement that AB 3088 provides more protection to tenants compared to the CDC moratorium is correct. However, there are areas where the CDC eviction moratorium can be more protective. Below are differences between AB 3088 and the CDC moratorium that landlords should be aware of in order to consider policies that provide tenants the full protection under both once a hardship declaration is received:
Under both AB 3088 and the CDC order, protections don’t take effect until the tenant returns a declaration. The AB 3088 declaration is less restrictive than the CDC declaration. Moreover, under AB 3088, a tenant will permanently be protected from eviction for unpaid rent from March 1, 2020 to January 31, 2021, if the tenant returns the required declarations and pays 25% of the rent for the period from September 1, 2020 to January 31, 2021. Under the CDC order, tenants are only protected through December 31, 2020, but there is no requirement to pay 25% of the rent.
Under the CDC order, tenants only have to return one declaration to protect them from eviction through December 31, 2020. To obtain the full protection afforded under AB 3088, landlords can require tenants to submit monthly declarations.
Under AB 3088, the landlord must provide a copy of the AB 3088 declaration to the tenant along with every 15-Day Notice. However, under the CDC order, the landlord has no obligation to provide the tenant with the CDC declaration. The tenant must proactively find a copy of the CDC declaration (or something similar which includes specific language pursuant to requirements under the CDC order).
The AB 3088 declaration is supposed to be returned within 15 days to the landlord in order for the tenant to receive the protections afforded under the law. In contrast, the CDC declaration can be submitted at any time, including up until the lockout takes place. We are already starting to see cases where tenants are submitting CDC declarations to the court and/or to the landlord. As a result, landlords who file evictions prior to December 31, 2020, should be prepared for the high probability that their case could be dismissed or continued until next year because a tenant submits a CDC declaration after an eviction is filed. Landlords should also be prepared that tenants’ rights attorneys will no doubt be making CDC declarations readily available to tenants who are in the process of being evicted, increasing the chances that the CDC order will impact those cases.
The CDC moratorium does not allow landlords to pursue “no fault” evictions of any kind until after December 31, 2020. The only cases that are exempt from the CDC moratorium are cases that are filed for the following reasons: (1) breach of lease; (2) criminal activity; (3) behavior threatening the health or safety of others; (4) property damage; (5) violation of building codes or health ordinances. In contrast, there are several “no fault” reasons a landlord could potentially evict a tenant under AB 3088 that are prohibited under the CDC order, such as removing the unit from the rental market, allowing an owner to move into the premises, a tenant’s refusal to sign a renewal lease, or if the tenant fails to vacate after tendering a notice of intent to vacate to the landlord, and then failing to vacate upon the expiration date. Landlords should be very careful about attempting to evict a tenant for any ‘no fault’ reason allowed under AB 3088 until after the CDC order expires on December 31, 2020.AB 3088 allows landlords to require verification of COVID-19 related distress for “high-income” tenant households. The CDC order does not allow landlords to demand verification under any circumstances in order to be protected. Tenants are only required to submit one declaration signed under the penalty of perjury with no verification attached.
Under AB 3088, tenants must declare that they’ve experienced a “COVID-19 related” hardship whereas under the CDC order, there is no requirement that the financial hardship be COVID-19 related. Under the CDC order, any economic hardship is acceptable.
AB 3088 does not apply to cases for rent that became due before March 1, 2020, where a landlord served a notice and started the eviction process. However, the CDC moratorium protects against all non-payment evictions no matter when the rent became due. As stated above, we are already seeing tenants submitting CDC declarations to the court or to the landlord in these cases where lockouts have not yet occurred in order to stay the eviction until after December 31, 2020.
In reviewing the differences between AB 3088 and the CDC order, it is clear that AB 3088 does not provide greater protections to tenants in all circumstances. Therefore, in light of the severe penalties and potential for jail time, and the fact that a tenant can invoke their rights under the CDC moratorium at any time up until lockout prior to December 31, 2020, landlords should adjust their policies in order to provide residents the protections associated with both AB 3088 and the CDC order unless California receives an “official” waiver from the federal government.
For example, once a landlord receives one signed declaration from a tenant, consider waiting until January 1, 2021, to file an eviction instead of requiring multiple declarations. Landlords should also consider treating all tenants as non-high-income households and forgo asking for verification of COVID-19 distress along with a signed declaration. In addition, landlords should wait until January 1, 2021, before serving notices for any “no fault” reason allowed under AB 3088. These actions will reduce your risk of affirmative lawsuits for failure to comply with both the CDC order and AB 3088.
And finally, make sure that all community managers are instructed to alert upper management immediately and cease any eviction action whenever a declaration of any kind has been returned.
Please let us know how KTS can assist you during these challenging times. Our attorneys are available to assist you with any questions about these issues. Feel free to contact us info@kts-law.com.
Kimball, Tirey & St. John LLP is a full service real estate law firm representing residential and commercial property owners and managers. This article is for general information purposes only. While KTS provides clients with information on legislative changes, our courtesy notifications are not meant to be exhaustive and do not take the place of legislative services or membership in trade associations. Our legal alerts are provided on selected topics and should not be relied upon as a complete report of all new changes of local, state, and federal laws affecting property owners and managers. Laws may have changed since this article was published. Before acting, be sure to receive legal advice from our office. For contact information, please visit our website: www.kts-law.com. For past Legal Alerts, Questions & Answers, and Legal Articles, please consult the resource section of our website.
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