Tuesday, March 25, 2008

Why Not Just Say That Tenants Have No Rights

Lately, things have not been going well for tenants up on appeal. First, there was last year's Action Apartment decision (Action Apartments v. City of Santa Monica, (2008) 41 Cal.4th 1232). Now comes the First District Court of Appeal in the case of 1100 Park Lane Associates v. Feldman.

Action Apartments was the culmination of what I believe is the law of unintended consequences. In the 1980s, corporations or people started to sue people for protesting certain practices. These types of suits became known as SLAPP suits. Essentially, certain parties were using the courts to restrict people's speech by forcing them to litigate the cases. In response to the rise of SLAPP suits, the California legislature passed a law which is now section 425.16 of California's Code of Civil Procedure, an anti-SLAPP statute.

Section 425.16 allows a part defending against a complaint or cross-complaint to file a motion. If the motion is successful, it terminates the case. The court, when considering an anti-SLAPP motion decides two things. First, it determines whether the activity challenged by the complaint is a protected activity. Second, the court determines whether the plaintiff (or cross-complainant) has a probability of prevailing in the law suit. If the plaintiff loses, they could also be responsible for attorneys fees. If the defendant loses their anti-SLAPP motion, they can appeal it immediately. While the case is up on appeal, the case is stayed.

Now, the basic idea is good. However, at least in the case of landlord tenant law, it is effectively stripping tenants of their rights. In Action Apartments, the California Supreme Court held that serving a notice to quit, the document needed to initiate an eviction action, on a tenant is a protected activity covered by the litigation privilege. Essentially, what this boiled down to is that the court found that if a landlord served a notice to quit, a tenant could not later sue the landlord for wrongful eviction based on the notice to quit.

Action Apartments made things harder for tenants. However, the opinion seemed to leave open some ways for tenants who had been wrongfully evicted by their landlords to seek redress. Then came the decision in 1100 Park Lane Associates v. Feldman.

In Feldman, the landlord 1100 Park Lane Associates LLC (of whom some of the members are Walter Lembi (of the CitiApartment/Skyline Realty Lembi family) and Andrew Hawkins) leased an apartment to Peter Levi. Mr. Levi had sub-tenants, Konrad Feldman and Jennifer Foote-Feldman, who were approved by agents of the 1100 Park Lane. A month after they moved in, and after they had been told that they had done everything necessary in order to be approved sub-tenants on the premises, they were contacted by the landlord. As the appellate court's opinion states, "

On June 2, 2005, the Feldmans received notice from Andrew Hawkins, who identified himself as the "trouble shooter" for the owner of the apartments, that their sublease application had not been approved and they were in possession of the premises unlawfully. Although the Feldmans showed Hawkins their documentation from Seigel, Hawkins insisted that they were unapproved occupants and that they would either have to leave or pay "market rent" for the premises, estimated to be over $2,000 more per month than the monthly rental the Feldmans were paying under the sublease.

When the Feldman's would not agree to the rate increase, Park Lane initiated an unlawful detainer by serving a three day notice and then filed a complaint with the San Francisco Superior Court. The unlawful detainer alleged that the eviction was proper because the Feldmans were unapproved subtenants and that they had changed a rug in the apartment without permission.

Eventually, the Feldmans surrendered their lease. However, they then retained counsel, ironically enough a firm that spends most of its time evicting people on behalf of landlords, and field suit. The suit consisted of the following claims: (1) retaliatory eviction, (2) negligence, (3) negligent misrepresentation, (4) breach of the implied covenant of quiet enjoyment--tort and contract, (5) wrongful eviction, (6) breach of contract, and (7) unfair business practices (Bus. & Prof. Code, § 17200).

Upon receiving the complaint, Park Lane filed an anti-SLAPP motion. The trial court ruled in favor of Park Lane, as the appellate court noted, "The court found that all seven causes of action arose from Park Lane's right of petition, but that the Feldmans had failed to establish a probability of prevailing on the first cause of action only. It awarded the Park Lane cross-defendants their costs and attorney fees pursuant to section 425.16, subdivision (c), with the amount to be fixed pursuant to a noticed motion."

On appeal, the trial court's decision was upheld. The court held that all of the causes of action related to the landlord serving the notice and filing the complaint for unlawful detainer. The court even went so far as to state that,

The Feldmans argue that their breach of contract cause of action is not covered by the statute, because the activity of breaching the contract is separate and distinct from the protected activities identified above. We disagree. First, it is established that conduct alleged to constitute a breach of contract may also come within the statutory protections for protected speech or petitioning. (Navellier I, supra, 29 Cal.4th 82, 92; Midland Pacific Building Corp. v. King (2007) 157 Cal.App.4th 264, 273.) We focus, as we must, {Slip Opn. Page 15} not on the label of the cause of action, but on Park Lane cross-defendants' activities challenged in the cross-complaint. The breach of contract claim contends that the Park Lane cross-defendants "breached the Addendum by the actions alleged herein, and by illegally evicting Levis from the premises, seeking thereby to deprive Cross-complainants of their contractual rights to occupancy of the premises." "The actions alleged herein" are Hawkins's threats, the service of the three-day notice, and the filing of the unlawful detainer action. The activities that allegedly breached the contract were the protected activities. The claim that the eviction was "illegal" because the Feldmans were lawfully in possession under the Addendum does not transform these protected activities into something different or independent. The breach of contract cause of action arose from protected activity.

Basically the court stated that even though there was a contract, and that the contract was breached by the landlord, the tenant has no means to bring an action in the court. Essentially, the service of the notice and/or complaint for unlawful detainer immunizes the landlords.

Let's see... the landlord can violate the terms of a contract and suffer... nothing if they have done something that could be deemed protected by the litigation privilege. Should the tenant violate the terms of the contract, they get served with a notice and most likely followed by a complaint for unlawful detainer with a serious chance of being evicted. Now, where is the equity in that?

Prior to Action Apartments, when a landlord did something like this, they would face a lawsuit for wrongful eviction. If they had done wrong, then the landlord would pay for it. The argument by the landlords' groups was that this was penalizing the small "mom and pop" landlords who were just renting some property and not legally savvy enough to know when they were breaking the law and that they should be protected. (And as a side note, I seem to remember being taught from a very young age that ignorance is not a defense under the law.)

Now we have law being interpreted in such a way that litigation privilege is now being used to oppress tenants who are being unlawfully evicted. Instead of the law being used to compel people to honor lawful agreements, it is now being used to protect the stronger party in an unequal relationship from having to face virtually an consequences for their wrongful acts!

Unfortunately, the way that the opinions have been written, the only redress seems to be the legislature. However, the way that the California legislature has been viewing landlord-tenant law lately, it seems unlikely that there will be any relief for tenants coming.

No regulation, no redress in the courts, and almost no chance of liability to being bad to your tenants... must be good to be a landlord right now.

1 comment:

CiviZen_Munk said...


Get this: I was just evicted... from the apartment office which I haven't set foot in for months, after my employment was terminated. And I have a judgment against me for all the back "rent" through now.

Plus, they locked me out the day before my contract terminated. With my personal belongings still in there.

What you report dampens my vigor for fighting this.