BILL ANALYSIS �
SB 825
Page 1
Date of Hearing: July 3, 2012
ASSEMBLY COMMITTEE ON JUDICIARY
Mike Feuer, Chair
SB 825 (Corbett) - As Amended: June 7, 2012
As Proposed to be Amended
SENATE VOTE : NOT RELEVANT
SUBJECT : RESIDENTIAL TENANCIES: FORECLOSURES
KEY ISSUE : SHOULD THE SUNSET ON EXISTING LAW BE EXTENDED FOR
SIX YEARS GIVING TENANTS NOTICE OF RIGHTS WHEN THEIR RENTAL
PROPERTY IS SOLD IN FORECLOSURE?
FISCAL EFFECT : As currently in print this bill is keyed
non-fiscal.
SYNOPSIS
Existing law giving notice to tenants in foreclosed properties
of certain rights and responsibilities regarding the new owner
is scheduled to sunset at the end of the year. That law
requires that any notice of termination of the tenancy served
within one year after a foreclosure sale include certain
additional information to renters regarding their rights with
respect to eviction. This law was drafted by the author of this
measure, which would continue that provision in effect for six
years. Supporters argue that the law has been helpful in easing
the transition for innocent tenants when rental property is
subject to foreclosure. The bill has no known opposition.
SUMMARY : Maintains existing law for six years with respect to
notifying tenants of rights when rental property is sold in
foreclosure. Specifically, this bill continues existing law in
effect for an additional six years requiring that any notice to
quit served within one year after a foreclosure sale include
additional notice to renters regarding specified rights and
responsibilities with respect to the new owner.
EXISTING LAW , until January 1, 2013, requires that any notice of
termination of a tenancy served within one year after a
foreclosure sale include a notice to renters setting forth their
rights and responsibilities. (Code of Civil Procedure section
SB 825
Page 2
1161c.)
COMMENTS : In support of the bill the author states, "California
enacted important tenant protections which seek to give tenants
additional time to search for a new home and move when the unit
in which they are living is foreclosed upon. President Obama
likewise recognized the importance of additional time and signed
the Protecting Tenants at Foreclosure Act of 2009, requiring
that tenants be given 90-days' notice and that fixed-term leases
be honored. Despite the establishment of these important
protections, many innocent tenants have received notices to
vacate that are unclear and contain different timeframes in
which the tenant must vacate the property. For example, some
notices state that the tenants must leave in three, 30, 60, or
90 days. These multiple and conflicting timeframes - combined
with complex legalese - are confusing to tenants. In addition,
some tenants have received a three-day notice to quit that is
addressed to the homeowner, but not to the tenant. Innocent
tenants do not realize that they must take certain steps to
protect their rights. In other cases, innocent tenants are
unaware of their rights under federal law and take the three-day
notice to quit at face value and assume that they must leave
within three days. SB 825 will help to protect tenants and
ensure that they receive the full benefits of the important
protections that have been enacted over the last few years by
extending the sunset on important protections put in place by SB
1149 (Corbett, 2010)."
As proposed to be amended, this bill would continue existing law
in effect for an additional six years, consistent with other
foreclosure-related measures.
Author's Amendments. Rather than simply delete the sunset as
the bill currently provides, the author instead proposes that
the sunset be extended to January 1, 2019.
REGISTERED SUPPORT / OPPOSITION :
Support
None on file
Opposition
None on file
SB 825
Page 3
Analysis Prepared by : Kevin G. Baker / JUD. / (916) 319-2334