AB 2925

Page 1

Date of Hearing: May 1, 2018

ASSEMBLY COMMITTEE ON JUDICIARY

Mark Stone, Chair
AB 2925 (Bonta) – As Amended April 24, 2018

As Proposed to be Amended

SUBJECT: TENANCY: CAUSE FOR TERMINATION: NOTICE

KEY ISSUE: IN ORDER TO SAFEGUARD AGAINST ARBITRARY NO-CAUSE

EVICTIONS —THOSE INITIATED WITHOUT ANY STATED REASON—AND
RECOGNIZING THE SERIOUS DISRUPTIVE IMPACT THAT EVICTIONS HAVE ON
FAMILIES GENERALLY, SHOULD LANDLORDS BE REQUIRED TO SPECIFY THE
CAUSE FOR EVICTION IN ANY NOTICE TO TERMINATE TENANCY?

SYNOPSIS

Current law allows landlords to evict tenants without a reason, absent local eviction controls,
upon 30 or 60-days’ notice, depending on the length of tenancy. The author and supporters of
the bill believe that in the current affordable housing crisis, that is often not enough time for
families to uproot from the home and find a new place to live. Supporters also caution that,
without having to state a reason for terminating tenancy, an eviction can be discriminatory,
arbitrary, and retaliatory in nature, and used for purposes that would otherwise be
impermissible under state law. This bill simply requires a landlord to provide a reason for
terminating tenancy, to be stated with particularity in the existing notice of termination.
Proposed author's amendments are largely technical and clarifying in nature, but do specify that
expiration of a fixed term lease or an anticipated change in ownership of the property do not
constitute sufficient cause to terminate a tenancy. The bill is supported by Western Center on
Law and Poverty, Tenants Together, and other community groups who believe that by requiring
landlords to provide a reason for terminating tenancy, this bill will help ensure that tenants are
not being evicted for arbitrary, discriminatory, or retaliatory causes. The bill is strongly
opposed by apartment associations and other business groups, who contend that it will make it
harder for landlords to evict bad tenants, increase litigation over for-cause determinations, and
even lead to higher rents in California.

SUMMARY: Requires that cause for eviction be stated by the landlord in any notice to
terminate tenancy, and specifies certain events that shall not constitute cause for termination of a
tenancy or eviction of a tenant. Specifically, this bill:

1) Provides that a landlord shall not issue a notice to terminate a tenancy pursuant to Section
1946 or 1946.1 of the Civil Code, or seek to recover possession from a tenant under Section
1161(1) of the Code of Civil Procedure, except for cause, as set forth with particularity in the
notice.

2) Provides that the following shall not constitute cause for termination of a tenancy or eviction
of a tenant for purposes of this act:

a) A change, or anticipated change, in ownership of the property.

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b) Foreclosure of the property.

c) Expiration of a fixed term lease.

3) States the intent of the Legislature to encourage or incentivize cities to enact just cause
eviction ordinances in order to prevent unnecessary displacement of tenants.

4) Clarifies that this act is in addition to, and does not supersede or preempt, any other state or
local law regulating the grounds for eviction or the termination of a tenancy.

EXISTING LAW:

1) Requires a 30-day written notice by either party to terminate a periodic rental agreement,
such as a month-to-month tenancy, without stating a reason. Allows the parties to provide by
an agreement at the time the tenancy is created that a notice of the intention to terminate the
tenancy may be given at any time not less than seven days before the expiration of the term.
(Civil Code Section 1946. All further references are to this code unless otherwise stated.)

2) Requires a landlord to give a 60-day written notice to terminate the tenancy for any reason,
or for no reason at all, when the tenant has occupied the premises for a year or more, except
as provided. Notably, for tenants who already live in a jurisdiction requiring just cause for
eviction, the 30-day or 60-day termination notice must state the reason for termination.
(Section 1946.1.)

3) Provides that a tenant has committed unlawful detainer when he or she continues in
possession of the property without the landlord's permission after the expiration of the lease
term. No specific additional notice is required for a tenant who is guilty of unlawful detainer,
except that a tenancy at will must be terminated by notice, as specified. (Code of Civil
Procedure 1161 (1).)

4) Provides that a tenant has committed unlawful detainer when he or she continues in
possession of the property without the landlord's permission after the tenant has failed to cure
nonpayment of rent, after service of a 3-day notice requiring payment of the rent past due.
(Code of Civil Procedure Section 1161 (2).)

5) Provides that a tenant has committed unlawful detainer when he or she continues in
possession of the property without the landlord's permission after the tenant has breached a
covenant of the lease or failed to perform other conditions under the lease, after service of a
3-day notice requiring performance of such covenants or conditions. (Code of Civil
Procedure Section 1161 (3).)

6) Provides that a tenant has committed unlawful detainer when he or she continues in
possession of the property without the landlord's permission after the tenant has breached a
covenant of the lease prohibiting subletting, assignment, or waste; has committed or
permitted a nuisance on the premises; or used the premises for an unlawful purpose. (Code
of Civil Procedure Section 1161 (4).)

FISCAL EFFECT: As currently in print this bill is keyed non-fiscal.

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COMMENTS: According to the author, recent data reported by the EvictionLab.org project
show that there were at least 41,178 eviction judgements across California in 2016, which means
each day approximately 112 families were evicted from their homes. That number does not
count the large number of tenants who voluntarily vacated the premises upon receiving an initial
notice to terminate the tenancy—something that happens well before a judgment in an eviction
case is issued. Current state law does not require a landlord to state a reason for evicting the
tenant, so without having to state a reason for terminating tenancy, an eviction may be at best
arbitrary, and at worst, potentially discriminatory and retaliatory in nature. This bill simply
requires a landlord to provide a reason for terminating tenancy, to be stated with particularity in
the existing notice of termination. According to the author:

Evictions can cause a family to lose their home and be expelled from their communities.
Children are negatively impacted during the eviction process by having to switch schools,
often in the middle of the school year. Eviction also has been shown to affect people’s
mental health: one study found that mothers who experienced eviction reported higher
rates of depression two years after their move. With growing housing costs, low vacancy
rates, high moving costs, and short eviction notices, finding a new place to live after
being evicted can be extremely hard. Families who are evicted can be pushed into
homelessness or unstable shelter for months or years following eviction.

This bill aims to prevent discriminatory, arbitrary, and retaliatory evictions. AB 2925 will
help protect Californian tenants from living in uncertainty, hoping they are not unjustly
evicted from one day to the next. By requiring landlords to provide a reason for
terminating tenancy, this bill will help ensure that tenants are not being evicted for
arbitrary, discriminatory or retaliatory causes. Furthermore, this bill will help ensure that
tenants who have not done any wrongdoing do not lose the place they call home due to
change of ownership, foreclosure of property, or expiration of a fixed-term lease. This
bill will help protect marginalized communities, such as the elderly, low-income
residents, people of color, and people with disabilities, providing them with stable
housing in the midst of a devastating housing crisis.

Proposed author's amendments specifying cause to terminate. Tenants Together, a statewide

organization for tenants' rights, states that in its experience, no-cause evictions are most common
in foreclosure and change in ownership situations. They write:

Through our statewide hotline we have counseled over 10,000 tenant households. We
regularly hear from tenants who receive a 30-or 60-‐day notice requiring them to move,
but stating no reason for eviction. In the absence of a local just cause for eviction law,
landlords are allowed to issue such notices. These no‐cause evictions are most common
in the following situations: First, where the ownership of the property is changing,
whether by voluntary sale or foreclosure, sellers or buyers or their agents will often
reflexively clear the property of tenants. This creates unnecessary displacement. Second,
where tenants assert their rights (usually by requesting repairs), some landlords will
retaliate with a 60-day notice that does not state any reason for eviction. AB 2925 will
provide greater stability for tenants in these unfair situations.

Accordingly, the bill provides that neither change in ownership of the property nor foreclosure of
the property, constitute good cause for termination of the tenancy or eviction of a tenant.
Author's amendments further clarify that an anticipated change in ownership shall also not
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constitute cause for termination. This is necessary to make sure the exiting landlord/owner in the
sale of an apartment building must state cause in a termination notice (i.e. when the change is
anticipated) and not just the entering landlord/owner (when the change has already happened).

Proposed amendments also specify that expiration of a fixed-term lease does not constitute cause
for termination of a tenancy. It is a very common scenario that a tenant will initially enter into a
one-year fixed-term lease upon moving into a property, which converts into a month-to-month
tenancy after one year if the landlord accepts rent. If expiration of a one-year fixed-term lease
initially bargained for by the parties does not constitute cause for termination, then opponents
legitimately question whether this provision will force landlords to retain all tenants on a month-
to-month tenancy upon expiration of the original fixed-term, even if the landlord has no desire to
so contract for at that point. On the other hand, Committee staff notes that every tenant who
becomes a month-to-month tenant in month 13, after expiration of a one year lease, is in fact just
a month-to-month tenant like any other at that point, and certainly susceptible to an arbitrary
eviction without cause--the precise event that this bill seeks to prevent from occurring.

The author may wish to further explore this issue and consider whether an amendment is needed
to clarify operation of the statute. He may wish to examine other local or state just-cause laws
which provide cause for eviction when the tenant refuses to accept the landlord's offer of renewal
of a fixed-term lease or other reasonable changes to the lease terms and conditions.

Proposed technical and clarifying amendments. The author also proposes a number of
technical and clarifying amendments to the bill. First, the use of the term "good cause" is
abandoned because it suggests that some causes are "good" and some must therefore be "bad."
According to the author, it is more appropriate to think of this as "with cause" and "without
cause." Evictions without cause are arbitrary and the reason for them unknowable to the tenant
and all others, except the landlord himself. Evictions executed with cause are more transparent
in nature, and as long as there is some cause provided, all parties, including a neutral court, can
evaluate whether that cause is sufficient to justify eviction or not, according to the applicable
laws of this state.

Proposed amendments also clarify that a landlord shall not seek to recover possession of the
rental premises from a tenant under CCP Section 1161(1) except for cause, as set forth in a
notice. This technical amendment is necessary to clarify the workability of the bill because
Section 1161(1), unlike other provisions of Section 1161, does not require any specific additional
notice before a tenant can be evicted by the landlord (unless he is a tenant at will, which does
require a notice). In any case, this amendment is necessary to clarify that a notice setting forth
the cause for eviction will be required for direct evictions under Section 1161(1) where no notice
currently exists that can be modified to simply state the cause.

Finally, proposed author's amendments also clarify that the Legislature's intent is to encourage
(but not require) local jurisdictions to define grounds for eviction at the local level. The bill
already makes clear that the bill will not preempt or supersede stronger local eviction
protections. The complete set of proposed amendments appears below:

SECTION 1. Section 1946.2 is added to the Civil Code, to read:

1946.2. (a) A landlord shall not issue a notice to terminate a tenancy pursuant to Section 1946 or
1946.1, or seek to recover possession from a tenant under Section 1161(1) of the Code of Civil
Procedure, except upon for cause, as set forth with particularity in the notice.
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(b) The following shall not constitute good cause for termination of a tenancy or eviction of a
tenant for purposes of this section:

(1) A change, or anticipated change, in ownership of the property.

(2) Foreclosure of the property.

(3) Expiration of a fixed term lease.

(c) It is the intent of the Legislature to encourage or incentivize, or require cities to enact just
cause eviction ordinances in order to prevent unnecessary displacement of tenants.

(d) This section is in addition to, and does not supersede or preempt, any other state or local law
requiring the showing of good cause regulating the grounds for eviction or prior to the
termination of a tenancy.

ARGUMENTS IN SUPPORT: The Western Center on Law & Poverty, writing in support of
the bill, argues that the bill will help keep families in their homes and avoid unnecessary
displacement in situations where there is no valid reason to evict that the landlord is willing to
state up front on a termination notice. Western Center states:

Current law allows landlords to evict tenants without a reason, absent local eviction
controls, upon 30- or 60-days’ notice, depending on the length of tenancy. Simply put,
this is not enough time in today’s housing climate for a family to locate, successfully
apply for, and move into new housing that is appropriate for their circumstances. Being
displaced from one’s housing often means being displaced from one’s community,
requiring not only finding a new home, but often also a new school for one’s children,
new doctors and medical providers, a new place of worship, and an entirely new routine.

AB 2925 merely requires landlords to list the reason for evicting a tenant on a notice they
are already required to provide. Surely, adding a sentence to such a notice does not work
an undue hardship on landlords, especially where it guards against the hardship of a
tenant losing their home arbitrarily. The bill does not change the rights of landlords to
evict tenants for reasons such as nonpayment, endangering other tenants, or violating
their lease. Nor does it change the rights of landlords with respect to what they can do
with their property – it still allows for evictions under the Ellis Act, owner move-in,
renovations and the like. AB 2925 simply says that where landlords don’t have a valid
reason to evict their tenants, these tenants should not be forced out of their homes.

ARGUMENTS IN OPPOSITION: Writing in opposition to the bill, the California Apartment

Association (CAA) contends that enacting just cause protections will be "ineffective and will
lead to significantly higher rents." Why? Apparently because landlords will raise rents
significantly if they can no longer evict tenants without cause. They state:

Just-cause—absent rent control—is not logical, and, in fact, will have the effect of
encouraging higher rents—at a time when we can least afford it. In the absence of rent
control, a property owner who needs to remove a tenant can simply raise the rent in order
to influence the tenant to vacate. In the event the unit is then returned to the rental
market, the owner is likely to set the rent rate at the higher amount, which will have the
effect of increasing the median rents for the area.”
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In response, the author states:

Absent rent control, landlords already have the ability to raise the rents of their units to
what the market is willing to pay. Actively seeking new opportunities to evict tenants and
cause uncertainty in the lives of Californian families further demonstrates the need for
these tenant protections. This bill seeks to eliminate arbitrary evictions that can take place
from one day to the next with no reason given to the tenant.

Tenants Together also notes that while it is best for just cause and rent control laws to be enacted
together for maximum effectiveness, there are some cities in California, including San Diego and
Glendale, that apparently lacked the political will to pass rent control but nevertheless did enact
just cause ordinances, so it is not necessarily true that one without the other has no impact.
Tenants Together also notes that some cities have extended just cause for eviction protections to
units that are exempt from rent control. For example, in San Francisco, single family homes are
exempt from rent control due to Costa Hawkins, but the just cause provisions of the local law
apply fully, requiring landlords to have and show cause to evict.

CAA also contends that enacting just cause protections will reduce access to housing for
struggling Californians, stating:

Today many property owners are willing to take a chance on an applicant who is
otherwise qualified but who has something in their past—such as an eviction when they
were young, a foreclosure, a bankruptcy, or a lack of credit history as a result of living
abroad. Property owners are willing to do this because they know that if the tenant is
unable to live up to their lease obligations, there is, today, a straightforward process to
recover possession of the unit. If AB 2925 becomes law, property owners will no longer
be willing to go out on a limb for these riskier applicants, who are often those in the
greatest need of housing.

In response, the author states:

AB 2925 does not prevent property owners from evicting tenants who breach their lease
agreements or fail to pay rent. The obligations of the tenants remain the same. This bill
seeks to level the playing field by ensuring that tenants who have done no harm are not
served an eviction notice without reason. According to the Eviction Lab, “Low-income
women, especially poor women of color, have a high risk of eviction. Research has
shown domestic violence victims and families with children are also at particularly high
risk for eviction.” By helping these individuals prevent an arbitrary eviction, we can help
prevent school displacements, job loss, housing insecurity, and other undue hardships tied
to evictions.

The San Diego County Apartment Association writes in opposition:

Just Cause eviction ordinances create many unintended consequences, one of which is an
unhealthy, uncomfortable, or even dangerous living environment for neighboring tenants
who report a nuisance to the property owner. In cities where Just Cause eviction
ordinances are in place, property owners do not have the ability to evict tenants who have
been repeatedly reported to harass, bully, or threaten neighbors or even commit petty
crime for which solid proof does not exist.
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Committee staff notes that this concern can just as easily be framed in the opposite direction.
When evictions are allowed without cause, a landlord with retaliatory motives is provided cover
to go ahead and evict a tenant for reporting a nuisance to the property owner that the owner
allows to exist or perhaps is responsible for creating in the first place. For example, if a
conscientious tenant makes multiple requests to the landlord to remove abandoned furniture or
blighted conditions on the grounds of an apartment complex that may be citable as a nuisance,
the landlord could find it easier to terminate the tenancy without cause (using a 30 or 60 day
notice) than to abate the nuisance. In that example, the tenant could be evicted with a retaliatory
motive in mind, but would lack any recourse for challenging the 30 or 60 day notice, given that
no cause is stated for its issuance.

In addition, it should be asked whether the property owner should have the ability to evict a
tenant for committing a petty crime "for which solid proof does not exist." The example cited by
SDCAA highlights the exact problem that this bill is intended to address—namely, that under
existing law, a landlord can give a 30-day notice to evict a tenant who, purely on his own belief,
is "committing petty crimes for which solid proof does not exist."

Apartment Association, California Southern Cities and group of other regional apartment
associations write in opposition:

Lease termination is a local issue. Applying a statewide one-size-fits-all mandate to lease

terminations is unnecessary and unreasonable. If local government leaders believe the
community needs “just cause” policies, they can vote for those policies, or let their
citizens vote for them. Each city and county is different, and each has very different
needs. There are currently 15 cities with “just cause” requirements for evictions. Most of
those cities have strict rent controls in place. Those cities also have the highest rents,
highest housing demand, and largest populations. Smaller communities do not suffer
from such problems and are without need for such residential rental mandates. Let city
leaders and the citizens of those communities choose for themselves whether a highly
litigious and expensive form of lease termination should be the standard for all rental
property leases. The state should not interfere with these choices.

Curiously, Committee staff notes that the same apartment associations that contend just cause
ordinances are a local issue that should be decided by individual cities, based on local housing
conditions, are the same apartment associations that sponsored and continue to support the
Costa-Hawkins Act—legislation that applies a statewide, one-size-fits-all mandate to limit the
scope of local rent control ordinances, and that for over 20 years has interfered with local
government leaders' authority to enact rent control measures stronger than that allowed by the
Act.

REGISTERED SUPPORT / OPPOSITION:

Support

Buena Vista United Methodist Church

California Renters Legal Advocacy and Education Fund
California Rural Legal Assistance Foundation
Congregations Organizing for Renewal
Disability Rights California
Faith in Action, Bay Area
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Filipino Advocates for Justice

Oakland Tenants Union
People Acting in Community Together (PACT)
TechEquity Collaborative
Tenants Together
Western Center on Law and Poverty
One individual

Opposition

Apartment Association, California Southern Cities

Apartment Association of Greater Los Angeles
Apartment Association of Orange County
California Apartment Association
California Chamber of Commerce
California Business Properties Association
California Association of Realtors
California Building Industry Association
Civil Justice Association of California (CJAC)
East Bay Rental Housing Association
North Valley Property Owners Association
Santa Barbara Rental Property Association
San Diego County Apartment Association

Analysis Prepared by: Anthony Lew / JUD. / (916) 319-2334