Lease agreements should include a tenant’s email address. There are many practical reasons for capturing a tenant’s email. One in particular is for purposes of notifying a former tenant of abandoned property. If the former tenant provided the landlord with the tenant’s email address, the landlord may also send abandonment notices by email and comply with the statutory requirements. See Cal. Civ. Code § 1983. While an email may not substitute for the notice provisions in a lease, the parties may certainly mutually agree to receiving notice via email.
Month: March 2016
Are Agents/Brokers Subject to the Statutory Duties Under Cal. Civ. Code § 1102 et. seq.
Generally, in a nondisclosure/fraud claim arising out of a real estate sale and transaction, wherein the buyer is bringing claims against both the seller and broker, we analyze the Transfer Disclosure Statement (“TDS”) to determine whether a breach of statutory duty claim should also be brought. If it is found that the TDS was not accurate or failed to disclose known material facts, we would consider bringing a breach of statutory duty against both the Seller and Seller’s Broker and California law supports such a claim.
Section 1102.4(a) seems to suggest that a listing agent shall be liable for any omission that was (a) within its personal knowledge, (b) was based on information timely provided by public agencies or by a person providing information as specified in this section and (c) required to be disclosed. See Cal. Civ. Code § 1102.4(a). Furthermore, Section 1102.9 states that an agent can amend the TDS if information becomes known. Moreover, in Loken v. Century 21 – Award Properties, (1995) 36 Cal. App. 4th 263, 274, the Court of Appeal held that a claim against a broker under Cal. Civ. Code § 1102 et seq for breach of statutory duty, is subject to a two year statute of limitations. Thus, such a claim against a broker is authorized under California law.
If you are a buyer of real estate and believe certain material facts were not disclosed during escrow, contact one of our Los Angeles Real Estate Attorneys today for a free consultation and case evaluation.
Landlords – Certain Unlawful Detainer Proceedings May Be Consolidated With Other Civil Actions
The expedited procedural framework for unlawful detainer cases is necessary to prevent frustration of the summary proceedings by the introduction of delays and extraneous issues. See Vasey v. California Dance Co., (1977) 70 Cal. App. 3d 742, 747. Therefore, a UD under C.C.P. § 1161 will only be interrupted by consolidation with a civil action where complex issues of title exist. See Martin-Bragg, (2013) 219 Cal. App. 4th 367, 393; see also Mehr v. Superior Court, (1983) 139 Cal. App. 3d 1044, 1049; see also Asuncion v. Superior Court (1980), 108 Cal. App. 3d 141, 145.
In Martin-Bragg, a property owner filed an unlawful detainer action against a tenant for failure to pay rent. See Martin-Bragg supra, 219 Cal. App. 4th at 371. The tenant subsequently filed a civil quiet title action against the property owner, alleging that he was the true owner of the property, and that due to a complex personal relationship with the property owner “he had caused title to the property to be transferred to her, with the understanding that she would hold it in trust for him.” Id. at 372. The Court concluded that the complex issues of title raised by the tenant required a departure from the summary procedures of the unlawful detainer action. Id. at 395.
In Mehr, an unlawful detainer action was filed by the purchaser of a property at a trustee’s sale. See Mehr supra, 139 Cal. App. 3d at 1046. The defaulted borrowers filed a separate civil case, alleging that the foreclosure sale was void because the foreclosure trustee and its attorneys, along with others, conspired with the purchaser to obtain possession of the property by unlawful means. Id. at 1049-1050. The borrowers alleged that they were lulled into believing they could exercise their right of redemption on August 14, but the sale occurred without their knowledge on August 13, and the property was awarded to the sole bidder for an inadequate price. Id. at 1050. In ordering a writ of mandate granting the borrowers’ motion for stay of execution of the post-judgment writ of possession pending appeal, the Court ruled that the fact-intensive question of fraudulent acquisition of title was not fully litigated at the unlawful detainer trial. Id.
In Asuncion, a hard money lender paid off a delinquent second mortgage and other debts of two borrowers in exchange for a grant deed to the property, subject to a 45-day option for the borrowers to reacquire the property by executing a promissory note in favor of the lender on very unfavorable terms. See Asuncion supra, 108 Cal. App. 3d at 143-144. Upon the expiration of the option, the lender recorded the grant deed and immediately commenced unlawful detainer proceedings. Id. at 144. The borrowers filed a separate civil action seeking to quiet title and alleging fraud, usury, unfair business practices and truth in lending violations. Id. at 143. The Court found that the title issues raised by the borrowers were sufficient to merit either a stay of the eviction proceedings pending adjudication of the title issues, or consolidation of the actions. Id. at 146-147.
Thus, short of complex title issues raised as a defense to an unlawful detainer action, Evictions would likely not be consolidated with a civil action. If you are a landlord and are seeking to evict a tenant, contact one of our Los Angeles Eviction Attorneys today for a free consultation and case evaluation.
Agency Disclosure Requirement Expanded to Include Commercial Property Transactions
Under existing law listing and selling agents are required to provide the seller and buyer in a residential one to four unit real property transactions, including a lease of more than one year, with a prescribed disclosure form containing general information on real estate agency relationships. Existing law also requires the listing or selling agent to confirm their agency relationship by disclosing to the buyer and seller whether he or she is acting as the buyer’s agent exclusively, the seller’s agent exclusively, or as a dual agent representing both the buyer and the seller.
This agency disclosure is extremely important because California Law imposes on real estate agents and brokers a duty to act with the utmost good faith in the best interests of their clients. Thus, a real estate client is owed a duty of good faith, loyalty, honesty, reasonable care and fair dealing.
Effective January 1, 2015, this law is extended to include transactions involving the sale or lease for more than one year of commercial real property. Commercial property as defined includes vacant land, industrial property or any residential property, even if containing more than four dwelling units.
SB 1171 (codified as Civil Code §2079.13) (effective January 1, 2015).
Real Estate Brokers and Agents – Duty to Retain Text Messages and Tweets in Connection with Real Estate Transactions
Under existing law, a broker must retain for three years copies of all listings, deposit slips, canceled checks, trust records, and other documents executed by him or her or obtained by him or her in connection with any transactions for which a real estate license is required. Effective January 1, 2015, electronic messages of an “ephemeral nature” such as text messages, instant messages, and tweets (unless designed to be retained or to create a permanent record) are excluded from this record retention requirement. The new law, however, does not clearly exclude emails from record retention requirements. Therefore, emails sent and received in connection with a transaction should still be retained. AB 2136 (codified as Business and Professions Code §10148 and Civil Code §1624) (effective January, 2015).
A broker who fails to retain transaction records for a period of three years may be cited by the Bureau of Real Estate and subject to formal legal action. You should review the record retention policies for your office to make sure you are in compliance with this code section.
If you are a real estate agent or broker and have a legal question, contact one of our Los Angeles Real Estate Attorneys for a free case evaluation and consultation.
Landlords – Certain Lessee Rights Cannot Be Modified Or Waived
There are certain rights which cannot be waived by a tenant even though that tenant might agree and put said waiver or modification in writing. Under Cal. Civ. Code § 1953, certain rights agreed waived or modified by a tenant shall be void and contrary to public policy including: (1) A tenant’s rights or remedies under Sections 1950.5 (security deposit) or 1954 (entry by landlord); (2) His right to assert a cause of action against the lessor which may arise in the future; (3) His right to a notice or hearing required by law; (4) His procedural rights in litigation in any action involving his rights and obligations as a tenant; (5) His right to have the landlord exercise a duty of care to prevent personal injury or personal property damage where that duty is imposed by law.
If you are a landlord and have a question regarding your residential or commercial lease, contact one of our Lease Attorneys in Los Angeles for a free consultation or case evaluation.
HOA Disputes – Equitable Servitudes Can Be Used Against HOA For Its Failure to Maintain Common Areas That Damage Separate Property
HOAs are responsible for the maintenance of Common Areas. An HOA’s failure to maintain a Common Area component, (such as sanitary sewers, roof, siding, plumbing, etc…) often times causes damage to a homeowner’s separate interest Unit. Sometimes, CC&Rs are silent regarding repairs to a homeowner’s unit caused by Common Area failures. However, California Courts have applied the Doctrine of Equitable Servitude in compensating a homeowner for damages sustained as a result of an HOA’s failure to maintain Common Areas. The California Court of Appeal for the Fourth District in Affan v. Portofino Cove Homeowners Association, (2010) 189 Cal. App. 4th 930 held that the HOA was liable for breaching an equitable servitude to indemnify plaintiff homeowners for their casualty loss and awarded plaintiffs their remediation and restoration costs as damages when the Common Area sewers backed up and flooded plaintiff’s separate unit.
If you are a homeowner subject to CC&Rs and have an issue with your HOA, contact one of our HOA Dispute Attorneys in Los Angeles for a free consultation and case evaluation.
Statute of Limitations Regarding Covenant Enforcement Actions
Our Los Angeles Real Estate Attorneys were recently asked to analyze whether the 5 year statute of limitations on land covenant enforcement actions was applicable to recently discovered violations. The statute reads as follows:
The period prescribed in this subdivision runs from the time the person seeking to enforce the restriction discovered or, through the exercise of reasonable diligence, should have discovered the violation. A failure to commence an action for violation of a restriction within the period prescribed in this subdivision does not waive the right to commence an action for any other violation of the restriction and does not, in itself, create an implication that the restriction is abandoned, obsolete, or otherwise unenforceable.
The statute is clear that a failure to commence an action for one violation, will not bar an action for another subsequent violation within the 5 year statute. If you have questions regarding a real estate matter, contact one of our Los Angeles Real Estate Attorneys for a free consultation and case evaluation.
Commercial Leases Are Assets and Subject to California’s Bulk Sales Law
Commercial Landlords, be advised that the commercial lease governing the tenancy of your commercial income property is considered an “asset” that is subject to the Bulk Sales Laws which govern the sale of certain businesses, such as restaurants for example. See Cal. Com. Code § 6102(a)(1)(ii). Thus, a commercial tenant seeking to sell a business, including his/her interest in a commercial lease must list the commercial landlord as a claimant in the event back rent is owed. If a commercial tenant in a sale governed by the Bulk Sales Law owes back rent, the landlord would then be a creditor subject to the Bulk Sales Laws. Commercial landlords with claims on a commercial lease in a sale governed by the Bulk Sales law would hold an unsecured claim which is lowest in terms of priorities in terms of distribution considerations. See Cal. Com. Code § 6106.4(b).
If you are a commercial landlord or a commercial tenant with questions regarding your commercial lease, contact one of our Los Angeles Commercial Lease Attorneys today for a free consultation and case evaluation.
Interpreting the Exclusive Authorization and Right To Sell Listing Agreements
Executing an “Exclusive Authorization and Right to Sell” agreement with a broker does not create the authority in the broker to sell the property by binding the seller to a purchase contract with a buyer. It is merely the authority to invite or procure prospective purchasers. See Holway v. Malloy, (1945) 70 Cal. App.2d 317, 319 (“Authority given to a broker ‘to sell’ real property, in listing it for sale, only authorizes him to find a purchaser; it relates to the services to be performed by the agent in order to earn the agreed compensation and does not make him the agent of the owner to enter into a contract of sale. This is a well established canon of the law of real property.”) Thus, the listing agreement only confers a right to bring buyers to the table, not to bind the buyer and seller to a deal.
If you are a seller or buyer of real estate, or if you are an agent or broker and have a question regarding a real estate transaction or deal, contact one of our Los Angeles Real Estate Attorneys for a free consultation and case evaluation. Our Real Estate Attorneys are also licensed California Real Estate Brokers. (888) 693-5556.