BILL ANALYSIS �
AB 2508
Page 1
Date of Hearing: April 29, 2014
ASSEMBLY COMMITTEE ON JUDICIARY
Bob Wieckowski, Chair
AB 2508 (Fox) - As Amended: April 7, 2014
SUBJECT : UNLAWFUL DETAINER: PLEADINGS
KEY ISSUES :
1)Should a tenant in an unlawful detainer action, as a condition
of asserting CERTAIN affirmative defenses, be required to
provide detailed facts applicable to the defense and other
specific information not currently required in the responsive
pleadings?
2)Should A tenant in AN unlawful detainer action, who IS already
required to answer within five days rather than the 30 days
allowed in regular civil proceedings, be required to meet
heightened pleading requirements in answering the complaint
that do not apply to ANY other categories of defendants?
SYNOPSIS
This bill, sponsored by the California Apartment Association,
seeks to establish heightened pleading requirements for tenants
to file a response to an unlawful detainer action-including some
requirements not placed on other defendants in civil
proceedings. Supporters of the bill contend that unscrupulous
tenant attorneys encourage clients to make every available
defense, whether or not it is meritorious, and thereby cause
unnecessary delays to what is supposed to be a summary process.
The sponsor claims that this tactic is facilitated by the fact
that a tenant may file affirmative defenses simply by checking a
box, and that the bill is necessary in order to prevent tenants
from making unwarranted affirmative defenses when they are
served with an unlawful detainer for failure to pay rent. This
bill, therefore, would require the tenant, among other things,
to allege facts describing the nature of alleged breach and
provide proof that he or she had notified the landlord about the
alleged problem-even though such information is not currently
required in responsive pleadings. It would also require tenants
to plead in their answer whether or not they have funds
sufficient to satisfy the judgment sought by the plaintiff, and
whether those funds will be retained pending the outcome of the
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action. Both of these proposals have been proposed before in
the similarly CAA-sponsored bill, AB 481 (Tran) of 2007. That
measure was not pursued by its author however.
This bill also proposes to prohibit tenants in unlawful detainer
actions from filing a general written denial in lieu of demurrer
or other answer to the complaint. This proposed change in
longstanding existing law significantly curtails the ability of
many tenants to defend themselves against eviction, is likely to
increase the number of default evictions, especially by
unrepresented tenants. The bill is strongly opposed by the
Western Center on Law and Poverty and other tenant advocates who
contend that this bill is not necessary, is vague in critical
places, and will only discourage tenants from asserting
legitimate defenses. It also should be noted that existing law
and rules of professional conduct already prohibit a defendant
or his attorney from asserting unwarranted defenses. This bill
will be referred to Appropriations Committee should it be
approved here.
SUMMARY : Establishes heightened pleading requirements for
tenants to file a response to an unlawful detainer action.
Specifically, this bill :
1)Prohibits tenants in unlawful detainer actions from filing a
general written denial in lieu of demurrer or other answer to
the complaint.
2)Requires a tenant in an unlawful detainer action involving
unpaid rent, when pleading the affirmative defense of a breach
of any warrant of habitability, to allege facts demonstrating
all of the following: (a) the specific nature of each failed
requirement of habitability that the landlord failed to
provide; (b) facts demonstrating the failure to be
substantial; and (c) the date on which the condition occurred.
3)Requires a tenant in an unlawful detainer action involving
unpaid rent, when pleading that he or she exercised the
repair-and-deduct remedy and the landlord did not give proper
credit, to allege facts in the answer demonstrating, among
other things:
a) the habitability requirement that the plaintiff
substantially failed to provide;
b) the date on which notice was provided to the plaintiff
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of the condition that required repair.
c) the circumstances under which a reasonable time for the
plaintiff to perform the repair was fewer than 30 days; and
d) the amount of money the defendant spent to make the
repair.
4)Requires a tenant in an unlawful detainer action involving
unpaid rent, when pleading the affirmative defense that rent
was tendered before the expiration of the notice and was not
accepted, to allege facts demonstrating all of the following:
(a) that after service of the three-day notice, but before the
three-day period expired, the defendant presented the full
amount of rent to the plaintiff; (b) that the plaintiff
refused to accept the payment; and (c) the form of the payment
tendered.
5)Requires the defendant to include one of the following
statements in the answer:
a) A statement that, at the time of filing the answer, the
defendant has funds sufficient to satisfy the judgment
sought by the plaintiff and whether those funds will be
retained pending the outcome of the action; or
b) A statement that, at the time of filing the answer, the
defendant does not have sufficient funds available to
satisfy a judgment in the plaintiff's favor and an
explanation of why those funds are not available.
6)Requires the Judicial Council, on or before July 1, 2016, to
develop a new form or revise an existing form that may be used
by a defendant to assert the affirmative defenses and
supporting facts to an unlawful detainer action, and requires
the defendant to include and verify these supporting facts and
statements in the form as prescribed by the Judicial Council.
7)Provides that these provisions will become operative on July
1, 2016.
EXISTING LAW :
1)Permits a defendant to file a general written denial in a case
in which the demand or value of the property in controversy
does not exceed $1000. (Code of Civil Procedure Section
431.40(a). All further references are to this Code unless
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otherwise noted.)
2)Requires the defendant to deny specific paragraphs or parts of
the complaint, either positively or on information and belief,
in a case in which the demand or value of the property in
controversy exceeds $1000. (Section 431.30(d).)
3)Requires the defendant in an unlawful detainer case to file
the answer within five days after service of the summons,
unless time to answer is otherwise extended for good cause
shown. (Sections 1167 and 1167.3.)
4)Provides that the breach of any warranty of habitability
(implied or express) is a defense to an unlawful detainer
action filed to recover possession or residential premises
based on nonpayment of rent. (Green v. Superior Court (1974)
10 Cal. 3d 616.)
5)Provides that in an unlawful detainer proceeding in which the
tenant has raised as an affirmative defense a breach of the
landlord's obligations under Civil Code Section 1941 or of any
warranty of habitability, the court shall determine whether a
substantial breach of these obligations has occurred.
(Section 1174.2.)
6)Provides that, if the defendant has filed an answer to the
complaint, trial of the proceeding shall be held not later
than the 20th day following the date that the request to set
the time of the trial is made. (Section 1170.5(a).)
FISCAL EFFECT : As currently in print this bill is keyed fiscal.
COMMENTS : This bill, sponsored by the California Apartment
Association, seeks to establish heightened pleading requirements
for tenants to file a response to an unlawful detainer
action-including some requirements not placed on other
defendants in civil proceedings. According to the author, these
extraordinary pleading requirements are needed to address
eviction delay tactics by unscrupulous tenant attorneys, as well
as to increase transparency in the public record created by
court filings in unlawful detainer cases. The author states:
Tenants do have a fundamental right to a decent and
habitable home and the right to defend themselves from
unjust evictions filed by unfair and oppressive landlords.
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It is, however, a common practice in eviction cases for
unscrupulous tenant attorneys to check various "affirmative
defense" boxes on the court's Answer-Unlawful Detainer Form
No. UD 105, without listing any basis for it. The purpose,
of course, is to buy the tenants more time to live in the
home with no intention of paying the landlord rent. In the
limited circumstances where tenants do list a defense, they
provide very little information, such as "the home has
mold." Statements such as this provide no sufficient
"facts," if true, to prove a substantial failure on the
part of the landlord to meet a habitability requirement, as
is required by law for use of this affirmative defense.
The author believes it would be useful to establish a
public record that demonstrates the extent to which
property owners who have been notified of substandard
conditions fail to respond. In some instances, the
owner's response may be unlawful retaliation in the form of
an eviction action. Requiring the tenant's answer to
indicate whether and when the owner was provided prior
notice would help the court understand the potential
culpability of the property owner in any violations and
provide guidance to policymakers in future efforts to
address property owners who fail to respond to complaints
of substandard housing conditions.
Thus the primary reason for this bill appears to be to
discourage "groundless" defenses allegedly proffered by some
tenants. The author states his belief that these defenses are
simply raised to "buy the tenants more time to live in the home
with no intention of paying the landlord rent." Proponents
claim these tactics sometimes result in three to six month
delays in a landlord regaining possession of a unit and a
corresponding loss in rental income. CAA believes that
requiring the tenant to provide additional statements will help
to establish good faith with respect to any claimed defense.
CAA concludes by noting that if substandard conditions exist
then they should be corrected, but if "allegations of
substandard conditions are simply made to game the system to get
free rent, then that too needs to be identified."
Summary Of Existing Law Requiring Tenants To Answer Within Short
5-Day Period After Complaint : When a residential tenancy has
been properly terminated for failure to pay rent, but the tenant
remains in possession of the premises even after being served
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with notice to pay or quit, the landlord most commonly initiates
an unlawful detainer action in order to regain possession of the
property. An unlawful detainer is considered a "summary
remedy," insofar as times to plead and set actions are shorter
than in other civil trials so that the owner may regain
possession with minimal delay. (See California Landlord-Tenant
Practice, Sections 9.1 through 9.6.)
After the landlord-plaintiff serves an unlawful detainer summons
and complaint, the tenant-defendant typically has five days,
Saturdays and Sundays included, to file an answer. (Section
1167.3.) Judicial Council form UD-105 permits the tenant to
deny statements in the complaint in whole or in part, and it
also permits the tenant to assert one or more of several
possible affirmative defenses, including a defense based on the
landlord's alleged breach of warranty of inhabitability. (See
also Green v. Superior Court (1974) 10 Cal. 3d 616, 633)
(holding that implied warranty of habitability is a valid
defense to an unlawful detainer action based on nonpayment of
rent and that prior dicta suggesting otherwise were
"inaccurate.")
Heightened Pleading Required To Assert Affirmative Defenses :
The sponsor contends that tenants and their attorneys often
allege every affirmative defense, apparently as a kind of "shot
gun" approach hoping that one of the defenses will work or cause
the eviction to be delayed. CAA claims that tenant attorneys,
among other questionable practices, encourage tenants to check
all of the boxes as a matter of course, and as evidence of this,
CAA has provided the Committee with snapshots of many websites
run by various eviction defense firms promising to help tenants
stop or delay their evictions for a fee. CAA states:
CAA has received hundreds of complaints from property
owners, claiming that eviction defense attorneys
regularly encourage tenants to make groundless claims in
the final stages of the eviction action for nonpayment
of rent. Tenants who have not paid the rent for months
claim they did not pay because the rental unit was
substandard. While there may be truth to some claims,
many of these claims are made simply as a way to delay
the eviction, as demonstrated in the attached examples
of eviction delay law firm websites.
Under current law, a tenant may assert habitability
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violations as an affirmative defense in his or her
answer to an unlawful detainer complaint. They simply
need to check a box on the court Answer with no
explanation of the defense. By checking a box on the
Answer, the eviction is automatically delayed 20 to 40
days.
The sponsor claims that the practice in question is facilitated
by the fact that the answer form (UD-105, rev. January 1, 2014)
simply provides the tenant with a list of affirmative defenses
with a corresponding box to check. However a review of form
UD-105 suggests that it requires more than the mere checking of
one or more boxes. A parenthetical note that precedes the list
of defenses states the following: "For each box checked, you
[the tenant] must state brief facts in support in the space
provided at the top of page two." The tenant is provided with
enough space to write a short paragraph and instructed that he
or she may continue the statement in a separate attachment.
This bill would instead augment this existing requirement by
further requiring the tenant to provide more information when
asserting certain affirmative defenses in response to an
unlawful detainer based on nonpayment of rent. For example, the
bill would require a tenant asserting a breach of the warranty
of habitability as an affirmative defense to allege facts
demonstrating all of the following: (a) the specific nature of
each failed requirement of habitability that the landlord failed
to provide; (b) facts demonstrating the failure to be
substantial; and (c) the date on which the condition occurred.
Similarly, with respect to the affirmative defense that rent was
tendered before the expiration of the notice and was not
accepted, or the affirmative defense that the tenant exercised
the repair-and-deduct remedy and the landlord did not give
proper credit, the tenant would be required to allege a number
of additional facts and details in the responsive pleading (as
described above in the Summary) in order to affirmatively make
the defense at trial.
This bill is opposed by the Western Center on Law & Poverty
(WCLP) and the California Rural Legal Assistance Foundation
(CRLAF). These opponents write:
To the extent that these provisions are intended to
require much greater specificity than UD-105, we would
insist that the extremely short time to file an answer
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to the UD complaint be extended. Subdivision (d) of the
bill requires the statements to be verified. Tenants,
especially low-income tenants with job and family
responsibilities, are not in a position to drop
everything and dig out records, etc., as required by the
bill, within the extremely short 5-day deadline to file
an answer. Further, the bill would require the tenant to
state facts that go beyond merely pleading the essential
elements of the defense.
Requiring Notice As An Element Of Defense Appears To Run
Contrary To Existing Law: Under current law, a tenant may
legitimately assert breach of the warranty of habitability as an
affirmative defense to an unlawful detainer complaint. However,
CAA claims that the defendant's answer is often the first time
that the owner is notified of a substandard condition. And
because California law prohibits landlords from entering rental
units to perform inspections without the tenants consent, CAA
contends, the landlord will not typically be apprised of
substandard conditions unless the tenant brings it to the
landlord's attention. As such, the bill requires that a tenant
wishing to assert the affirmative defense of failure to receive
credit for the repair-and-deduct remedy must plead the date on
which notice was provided to the plaintiff of the condition that
required repair, as well as the date notice was given to the
plaintiff of the tenant's expenditures to make the repair, among
other things.
Existing case law makes it clear that a tenant is not required
to give prior notice of substandard conditions or give the
landlord time to make repairs in order to make an affirmative
defense of breach of habitability. For once the premises are
inhabitable, the obligation to pay rent ceases. (See e.g.
Knight v. Hallsthammar (1981) 29 Cal. 3d 46, 54-55.) Under
existing law, notice is not an element of the defense, and
therefore is not properly pleaded as it is an immaterial
allegation under Section 431.10 (b), and would likely be subject
to a motion to strike under Section 436(a).
Nevertheless, the author contends that requiring defendants to
provide additional information - including whether or not they
have provided notice, even though they are not currently
required to do so in order to make the defense - would usefully
"establish a public record that demonstrates the extent to which
property owners who have been notified of substandard conditions
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fail to respond." CAA contends that this record would "provide
guidance to policymakers in future efforts to address property
owners who fail to respond to complaints of substandard housing
conditions." They further state:
By requiring a tenant to explain within the Answer the
reason for the defense, CAA believes you help the owner
prepare for trial, while at the same time, you help the
court understand the claim made by the tenant for
nonpayment of rent. Simultaneously, by requiring a
tenant to indicate under penalty of perjury the nature
of the defense, you help the courts and the rental
industry identify a consistent unethical practice used
by firms to delay eviction.
As noted above, the sponsor asserts that the intent of the bill
is not to change existing law by creating a new requirement to
give prior notice. Nevertheless, a potential unintended
consequence of this bill may be some understandable tenant
confusion, especially since many tenants are not assisted by
legal counsel.
In addition, there has been an important policy rationale behind
not requiring prior notice historically. The courts, for
example, have taken notice of the "unequal bargaining power"
between landlords and tenants. (See e.g. Green v Superior
Court, supra 625-625 at and Knight v. Hallshtammar, supra at
54.) Given this unequal power, tenants might fear that if they
make too many complaints, even if justified, a landlord might
take retaliatory action.
Existing Law Already Appears to Provides Strong Remedies Against
Unscrupulous Attorneys : To the extent that tenant attorneys
file affirmative defenses without merit, the law already appears
to provide strong potential remedies. First, California
attorneys are bound by the California Rules of Professional
Conduct and relevant portions of the Business & Professions
Code. These rules generally prohibit an attorney from filing
actions that the attorney knows to be without merit solely to
delay the proceedings. (See e.g. California Rules of
Professional Conduct Rule 3-200 and Business & Professions Code
Section 6068 (c).) Existing rules of civil procedure permit the
court to impose sanctions against any attorney who uses any
actions or tactics that "are frivolous or solely intended to
cause unnecessary delay." (Sections 128.5(a) and 128.6(a).)
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In addition, every pleading that an attorney submits to the
court must be signed. That signature certifies, among other
things, that all claims, defenses, and other legal contentions
are warranted by existing law, or by non-frivolous arguments for
the extension, modification, or reversal of existing law. By
signing the pleadings, the attorney is also swearing that all
allegations, denials, and other factual contentions are
supported by evidence or the likelihood of producing such
evidence. (Section 128.7.)
This Bill Singles Out Tenants In Unlawful Detainer Actions From
Other Defendants To Prohibit The Use Of A General Written
Denial . In addition to creating the new requirements for
affirmative defenses as discussed above, this bill would also
prohibits tenants in unlawful detainer actions from filing a
general written denial in lieu of demurrer or other answer to
the complaint. Opponents note that this proposed change in
longstanding law significantly would appear to curtail the
ability of many tenants to defend themselves against unlawful
detainer, and is likely to increase the number of default
evictions, especially by unrepresented tenants. Tenant
attorneys contacted by the Committee report that many tenants
are forced to file a general denial because there is simply no
time to figure out how to plead defenses within the short 5-day
period allowed to file an answer. Tenant attorneys often
reportedly advise tenants to file a general written denial and
then come to their office for an appointment to amend their
answer, simply because of the short time frame to respond. In
opposition to the bill, Tenants Together states:
In contrast to a regular civil proceeding in which a
defendant has thirty days to respond to the complaint, a
tenant must respond to an unlawful detainer (UD)
complaint in five days. The five days includes weekends,
so a UD served on Friday requires a response by the
following Wednesday. With overburdened and underfunded
legal services organizations, many tenants have no
access to legal advice within the five days. Most of the
time, they end up representing themselves. Requiring a
heightened level of pleading will unnecessarily
complicate the process of responding to an eviction.
Opponents note that the general written denial is an important
tool for defendants generally to file a response to the
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complaint and initiate their own defense. Like a formal answer
that specifically denies each allegation, the general denial,
they assert, is sufficient to put at issue all allegations in
the complaint essential to the landlord's case-but in a manner
more accessible to the average non-lawyer. Opponents claim that
this bill's proposal to eliminate this option only in
landlord-tenant cases, where the majority of tenants are
unrepresented in court, will consequently have the unmistakable
effect of increasing default evictions, since unrepresented
tenants may be more inclined to give up and not present any
defense, even in cases where one is appropriate. Opponents
worry that this rule may even empower clerks to refuse to file
answers that aren't sufficiently detailed, yielding many more
defaults.
Finally, opponents contend that elimination of the general
written denial for tenants is overbroad and not tailored to the
problems cited by proponents as the justification for the bill.
They contend that the ability to raise a general denial has
little to do with issues arising from the assertion of
affirmative defenses. Opponents contend that elimination of the
general denial would impact tenants in unlawful detainer cases
across the board, including even those not asserting breach of
habitability as an affirmative defense, and most
problematically, unrepresented tenants simply seeking to defend
themselves and avoid default.
This Bill Creates An Unprecedented Requirement For Tenants To
Plead Their Financial Ability To Pay The Judgment : Opponents
also raise concerns about provisions of the bill that require
the tenant to plead a statement in his answer that he does or
does not have funds sufficient to satisfy the judgment sought by
the plaintiff, and whether those funds will be retained pending
the outcome of the action. "Should a business defending a case
where the plaintiff is asking for many millions of dollars" WCLP
asks rhetorically, "be required to plead that they have all the
funds?" Moreover, the opponents add, when a defendant asserts a
habitability defense, he or she is claiming that the rent owed
is zero. What rent is owed, if any, will eventually be set by
the judge depending on which side prevails. Tenants Together
contends that the requirement for a tenant to plead his
financial situation and ability to satisfy a judgment is a
burden not faced by any other litigant, and states that "the
proposed intrusion on a tenant's financial privacy is
unwarranted (and) would only serve to punish and humiliate
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tenants who assert their rights to raise a defense in court."
REGISTERED SUPPORT / OPPOSITION :
Support
California Apartment Association (sponsor)
Apartment Association, California Southern Cities
Apartment Association of Greater Los Angeles
Apartment Association of Orange County
East Bay Rental Housing Association
Nor Cal Rental Property Association
Santa Barbara Rental Property Association
Opposition
California Rural Legal Assistance Foundation
Tenants Together
Western Center on Law and Poverty
Analysis Prepared by : Anthony Lew / JUD. / (916) 319-2334