BILL ANALYSIS �
AB 1953
Page 1
ASSEMBLY THIRD READING
AB 1953 (Ammiano)
As Amended May 9, 2012
Majority vote
JUDICIARY 7-0
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|Ayes:|Feuer, Atkins, Dickinson, | | |
| |Huber, Monning, | | |
| |Wieckowski, Chesbro | | |
|-----+--------------------------+-----+--------------------------|
| | | | |
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SUMMARY : Establishes a conditional defense from eviction for
nonpayment of rent in cases where the tenant has not been
notified who or where to pay rent. Specifically, this bill :
1)Prohibits a successor owner or manager from serving a notice
pursuant to Code of Civil Procedure Section 1161(2) or
otherwise evicting a tenant for nonpayment of rent that
accrued during any period where the successor owner or manager
failed to comply with the existing obligation to disclose the
name and address of the person to whom rent shall be paid.
2)Clarifies that the above restriction shall in no case relieve
the tenant of any liability for unpaid rent.
EXISTING LAW :
1)Requires an owner of residential rental property or a party
signing a rental agreement or lease on behalf of the owner to
disclose in the rental agreement or lease all of the
following:
a) The name, telephone number, and usual street address at
which personal service may be effected of each person who
is authorized to manage the premises or act for and on
behalf of the owner for the purpose of service of process
and for the purpose of receiving and receipting for all
notices and demands;
b) The name, telephone number, and address of the person or
entity to whom rent payments shall be made;
AB 1953
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c) If rent payments may be made personally, the usual days
and hours that the person will be available to receive the
payments;
d) At the owner's option, either the number of an account
in a financial institution into which rent payments may be
made, and the name and street address of the institution,
provided that the institution is located within five miles
of the rental property, or the information necessary to
establish an electronic funds transfer procedure to pay the
rent; and,
e) The form or forms in which rent payments are to be made.
2)Provides that the above information required to be disclosed
shall be kept current and this obligation shall extend to and
be enforceable against any successor owner or manager, who
shall comply with this section within 15 days of succeeding
the previous owner or manager.
3)Requires an owner of residential rental property or a party
signing a rental agreement or lease on behalf of the owner to
provide a copy of the rental agreement or lease to the tenant
within 15 days of its execution by the tenant.
FISCAL EFFECT : None
COMMENTS : Existing law requires property owners to notify the
tenant of the name, telephone number, and address of the person
or entity to whom rent payments shall be made, and requires a
successor owner or manager to make this disclosure within 15
days of succeeding the previous owner. However, the law is
silent with respect to the rights of the parties when the
successor owner fails to comply with this notice requirement.
According to the author, this gap in the law unfairly allows a
successor owner to potentially take advantage of his own
noncompliance and initiate eviction against a tenant for
nonpayment of rent that could have otherwise been paid and
received if the owner had simply provided the required notice.
This bill seeks to prohibit a successor owner or manager from
initiating eviction against a tenant for nonpayment of rent that
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accrued during any period where a successor owner or manager
failed to comply with the existing notice requirement under
Civil Code Section 1962. The bill also establishes that this
provision shall in no case relieve the tenant of any liability
for unpaid rent.
The author explains the need for the bill as follows:
Purchasers of rental properties, especially foreclosed
homes, are increasingly allowing months to go by
without notifying tenants where to pay rent. When a
new owner fails to timely inform the tenant to whom
rent should be paid, but then months later serve a
three-day notice demanding all of the accumulated rent,
many low-income tenants no longer have the money to pay
and keep their homes. Good tenants end up losing their
housing because their landlord failed to comply with
the law, unnecessarily creating nonpayment situations.
This bill will help prevent unnecessary evictions after
ownership changes.
According to Tenants Together, the sponsor of the bill, some
tenants have received three day pay-or-quit notices from their
landlord for failure to pay rent when such failure occurred only
because the tenant had not been properly notified by the new
owner of the property where to send the rent payment. With
accounts of rental scams increasingly in the news (see e.g.,
"Foreclosure rattles upscale San Jose neighborhood and tenants."
San Jose Mercury News, 3/14/12), supporters contend that it is
reasonable for tenants to refrain from sending rent to the
person they know to be the former owner, or other unknown
persons, unless they have received proper notice from the new
owner where to send rent, as required by law. As acknowledged
by the California Apartment Association, "It is logical to
assume that if a new owner doesn't provide notice to a tenant
about change in ownership, the new owner cannot expect to
receive the rent timely."
This bill seeks to prohibit a successor owner or manager from
initiating eviction against a tenant for nonpayment of rent that
accrued during any period where the successor owner or manager
failed to comply with the existing notice requirement under
Civil Code Section 1962. New owners of property presumably have
sufficient incentive to comply with the 15-day notice
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requirement -they cannot receive rent until they do so.
Moreover, compliance with this modest notice requirement makes
defense from eviction moot in such cases. This bill, however,
protects tenants from the unfair consequences of facing eviction
for nonpayment from a successor owner who perhaps may be trying
to game the system by manufacturing cause to remove the tenant
that would not otherwise exist.
This bill also expressly provides that nothing in this bill
shall relieve the tenant of any liability for unpaid rent.
Under this approach, the tenant would remain liable for back
rent, but the rent that accrued when a landlord was out of
compliance could not be the basis for a nonpayment eviction.
This approach is similar to that already provided for by Code of
Civil Procedure Section 1161(2), which in certain cases prevents
a landlord from evicting for non-payment of rent that is over a
year old, yet does not waive the rent obligation itself. A
landlord could enforce the rent obligation by filing a small
claims action, or by deducting from the security deposit where
feasible. If an eviction action is nonetheless filed, this bill
would provide the tenant with clear defense from eviction, and
the court may be in the best position to fashion a solution for
the payment of unpaid rent suited to the unique circumstances of
each case. For example, where the tenant can demonstrate he or
she was faithfully paying the rent to the former owner during
that time, the new owner would have a cause of action to obtain
the rent money from the former owner who wrongfully kept
receiving the rent.
Analysis Prepared by : Anthony Lew / JUD. / (916) 319-2334
FN: 0003516