SB 567 – Changes to the Tenant Protection Act (AB 1482)

The major changes to the Tenant Protection Act (TPA) are specific to two No-Fault Causes: Owner/Family Member Move-In and Substantial Remodel/Demolition. The changes also increase the penalties and enforcement for violation of the TPA.

1. Rules for Owner/Family Member Move-In
   1. The owner or owner's spouse, domestic partner, children, grandchildren, parents, or grandparents must occupy the property for a minimum of 12 continuous months as their primary residence, and must move into the unit within 90 days after the tenant vacates;
   2. This no-fault cause is not available if the intended occupant occupies a rental unit on the property or if a vacancy of a similar unit already exists at the property;
   3. The written notice terminating a tenancy must contain the name or names and relationship to the owner of the intended occupant, and must notify the tenant that they may request proof that the intended occupant is an owner or related to the owner, as defined;
   4. If the intended occupant fails to occupy the rental unit within 90 days after the tenant vacates, or fails to occupy the rental unit as their primary residence for at least 12 consecutive months, the owner must offer the unit to the tenant who vacated it at the same rent and lease terms in effect at the time the tenant vacated, and the owner must reimburse the tenant for reasonable moving expenses incurred in excess of any relocation assistance that was paid to the tenant in connection with the written notice;
   5. If the intended occupant moves into the rental unit within 90 days after the tenant vacates, but dies before having occupied the rental unit for 12 months, this does not constitute a failure to comply with the bill or a material violation by the owner;
   6. For a new tenancy commenced within 12 months after terminating a tenancy, the unit must be offered and rented or leased at the lawful rent in effect at the time any notice of termination of tenancy was served; and
   7. Defines "owner" to mean any of the following:
      1. An owner who is a natural person that has at least a 25% recorded ownership interest in the property;
      2. An owner who is a natural person who has any recorded ownership interest in the property if 100% of the recorded ownership is divided among owners who are related to each other as sibling, spouse, domestic partner, child, parent, grandparent, or grandchild; or
      3. An owner who is a natural person whose recorded interest in the property is owned through a limited liability company (LLC) or partnership.
   8. Defines "natural person" to include any of the following:
      1. Any natural person who is a settlor or beneficiary of a "family trust," which means a revocable living trust or irrevocable trust in which the settlors and beneficiaries of the trust are persons who are related to each other as sibling, spouse, domestic partner, child, parent, grandparent, or grandchild; or
      2. If the property is owned by an LLC or partnership, a natural person with at least a 25% recorded ownership interest in the property.
   9. Defines "beneficial owner" to mean a natural person or family trust for whom, directly or indirectly and through any contract arrangement, understanding, relationship, or otherwise, any of the following applies:
      1. The natural person exercises substantial control over a partnership or LLC;
      2. The natural person owns 25% or more of the equity interest of a partnership or LLC; or
      3. The natural person receives substantial economic benefits from the assets of a partnership.
2. Substantial Remodel/Demolition
   1. Modifies the definition of "substantial remodel" to specify the following:
      1. The remodel must not be able to be reasonably accomplished in a safe manner that allows the tenant to remain living in the place and must requires the tenant to vacate the property for at least 30 consecutive days; *SCRHA note: Chula Vista requires that the remodel necessitate the unit being vacant for at least 60 days and that the remodel cost $40/sq. ft. Click here for more information on the Chula Vista Tenant Protection Ordinance.
      2. Provides that the tenant is not required to vacate the property on any days where a tenant could continue living in the property without violating health, safety, and habitability codes and laws;
   2. Requires a written notice terminating a tenancy under to include all of the following:
      1. A statement informing tenants of the intent to demolish or substantially remodel the unit;
      2. The following statement: "If the substantial remodel of your unit or demolition of the property as described in this notice of termination is not commenced or completed, the owner must offer you the opportunity to re-rent your unit with a rental agreement containing the same terms as your most recent rental agreement with the owner at the rental rate that was in effect at the time you vacated. You must notify the owner within 30 days of receipt of the offer to re-rent of your acceptance or rejection of the offer, and, if accepted, you must reoccupy the unit within 30 days of notifying the owner of your acceptance of the offer;"
      3. A description of the substantial remodel to be completed, the approximate expected duration of the substantial remodel, or, if the property is to be demolished, the expected date by which the property will be demolished, together with one of the following:
         1. A copy of the permit or permits required to undertake the substantial remodel or demolition; or
         2. If the notice is issued pursuant to a need to abate hazardous materials that does not require any permit, a copy of the signed contract with the contractor hired by the owner to complete the substantial remodel, that reasonably details the work that will be undertaken to abate the hazardous materials. *SCRHA Note: The cities of Chula Vista and San Diego have local ordinances that may require additional language. Please refer to the relevant SCRHA forms.
      4. A notification that if the tenant is interested in reoccupying the rental unit following the substantial remodel, the tenant must inform the owner of their interest and provide to the owner their address, telephone number, and email address.
3. Remedies/Enforcement
   1. Provides that an owner's failure to comply with any of the just cause provisions of the TPA renders a written termination notice void.
   2. Makes an owner who attempts to recover possession of a rental unit in material violation of the just cause provisions of the TPA liable to a tenant in a civil action for all of the following:
      1. Actual damages;
      2. In the court's discretion, reasonable attorney's fees and costs; and
      3. Upon a showing that the owner has acted willfully or with oppression, fraud, or malice, up to three times the actual damages. Allows an award to be entered for punitive damages for the benefit of the tenant against the owner.
   3. Allows the Attorney General and the city attorney or county counsel in the jurisdiction in which the rental unit is located to seek injunctive relief based on violations of the just cause provisions of the TPA.
   4. Makes an owner who demands, accepts, receives, or retains any payment of rent in excess of the maximum rent allowed by the TPA liable in a civil action to the tenant from whom those payments are demanded, accepted, received, or retained for all of the following:
      1. Injunctive relief;
      2. Damages in the amount by which any payment demanded, accepted, received, or retained exceeds the maximum allowable rent;
      3. In the court's discretion, reasonable attorney's fees and costs; and
      4. Upon a showing that the owner has acted willfully or with oppression, fraud, or malice, damages up to three times the amount by which any payment demanded, accepted, received, or retained exceeds the maximum allowable rent.
   5. Allows the Attorney General and the city attorney or county counsel in the jurisdiction the rental unit is located to do both of the following:
      1. Enforce the rental rate provisions of the TPA; and
      2. Seek injunctive relief based on violations of the rental rate provisions of the TPA.
   6. Provides that in an action for injunctive relief, it must be presumed that a tenant suffers irreparable harm through violation of the rental rate provisions of the TPA.
   7. Prohibits an action pursuant to the rental rate provisions of the TPA from being brought after three years from the date on which the cause of action accrued.