Tenant Law

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"Just Cause" for eviction for all San Francisco residential tenants?

2009-12-19T12:02:00.000-08:00

The S.F. Board of Supervisors passed an ordinance on December 8, 2009, which would extend the “Just Cause” for evictions section of the S.F. Rent Ordinance to all buildings built after 1979. Currently an owner of any residential rental unit built after 1979 (possibly close to 25,000 units) can evict a tenant without the need to state a reason in the 60 day notice to quit the premises. While State law does not allow the S.F. Rent Ordinance's rent increase limitation regulations to be extended to the newer units, the "Just Cause" provisions would afford some eviction protection and stability to tenants in those units, which could be important especially if the ownership of their unit transfers in foreclosure to a bank or speculative investor.

The ordinance passed 7-4, with Supervisor Bevan Dufty, future Mayoral candidate, voting against the measure. Unfortunately, Mayor Newsom has already publicly stated that he will veto the measure and without Dufty’s vote in favor of the measure, the Supervisors will not have enough votes to override the veto.

Hopefully at least one additional pro-tenant Supervisor will be elected in the coming years without any seats being lost and the “Just Cause” section of the S.F. Rent Ordinance can eventually be expanded to protect tenants in all residential rental units in the City and County of San Francisco.

L.A. Clippers Owner and Los Angeles Megalandlord Used Racial Discrimination in Providing Housing at His Rental Properties

2009-11-25T13:23:00.000-08:00

This month The United States Department of Justice obtained

... the largest monetary payment ever... in the settlement of a case alleging housing discrimination in the rental of apartments. Los Angeles apartment owner Donald T. Sterling has agreed to pay $2.725 million to settle allegations that he discriminated against African-Americans, Hispanics and families with children at apartment buildings he controls in Los Angeles.

See the Justice Department's Press Release.

The lawsuit alleged Mr. Sterling instructed his property managers and other employees that "African-Americans and Hispanics were not desirable tenants" and that employees maintained internal documents tracking the race of prospective tenants among Mr. Sterling's 119 apartment buildings (over 5000 apartment units). ESPN has reported that Mr. Sterling told one of his property managers that black tenants "smell" and are "not clean" and that Mexicans "just sit around and drink and smoke all day." The Justice Department's analysis showed that rentals to African American and Hispanic tenants at Mr. Sterling's properties was much lower then could be expected absent discrimination, and private lawsuits pending at the same time (and included in the settlement) claimed that Mr. Sterling's employees harassed and mistreated minority families who were already Mr. Sterling's tenants.

In addition to being a mega Los Angeles landlord and racially intolerant, Mr. Sterling is an NBA Team Owner of the Los Angeles Clippers. While his actions do not reflect well on the NBA which promotes a message of inclusiveness, the NBA as of now will not issue a statement condemning such discrimination nor launch an investigation into Mr. Sterling and his practices.

Tenant activists are pushing for the NBA to condemn racist housing discrimination and to investigate Mr. Sterling. Please sign the petition, located at www.nbashowyoucare.org.

Prop M - SF Anti Harassment Measure Succeeds(Yes We Can!)

2008-11-07T11:13:00.000-08:00

While we have been generally rejoicing the election results this week, the tally on the State and local San Francisco Propositions presents a surprisingly mixed picture. Proposition 8, which eliminates the right to same-sex marriage in California, though thoroughly opposed by San Franciscans, appears to have squeaked out a victory statewide. Locally, there were many propositions where San Francisco’s so-called “left-leaning” populace defied progressive expectations. Prop. K – which would have decriminalized prostitution – failed squarely, and also losing was Prop. B – the measure to establish a fund for construction of affordable housing. Moreover, Prop. V passed, as San Franciscan voters expressed surprisingly high disapproval with the School Board’s decision to remove the JROTC program from local schools. But in the spirit of optimism that has permeated throughout the country with the election of our 44th President - Barack Hussein Obama II - we’d like to focus on a local Proposition which did succeed, and which is advancing progressive policies in San Francisco. That Proposition – strengthening the protections for San Francisco’s population of renters – is Prop. M.

As of November 5, 2008 at 2:55 pm, The San Francisco Government Department of Elections website shows Prop. M ahead by a 20 point margin (60% yes, 40% no). The SF Rent Board has issued a news release announcing the measure has passed and stating the language of the new law, codified in the Rent Ordinance as SF Admin. Code Section 37.10B.

Proposition M defends the San Francisco renter by extending the San Francisco Rent Ordinance to prohibit acts of harassment by landlords against their tenants. Under Prop. M, tenants are now able to seek recourse through the SF Rent Board in the form of a “decrease in services” type petition. Where a landlord commits certain specified acts of harassment “in bad faith, with ulterior motive or without honest intent” the tenant can go to the rent board and get a rent deduction for the interference with her tenancy rights. Acts of harassment are defined in the new law to include such conduct as: attempting to influence a tenant to vacate their unit by “fraud, intimidation or coercion”; beginning repairs then never following through; illegally entering the unit; demanding proof of immigration status, social security card, etc.; continuing to offer to “buy-out” a tenancy after receiving notice from tenant that he is not willing to accept a buy-out; refusing to accept the rent, or to timely deposit the rent, or to acknowledge receipt of the rent; and interrupting, terminating or failing to provide housing services or maintenance.

While some of the acts prohibited by Prop. M are already illegal under State law, the prior inability to raise these issues successfully at the SF Rent Board has meant that, for many harassed San Francisco tenants, enforcement of these rights has been outside their reach. A tenant often cannot afford to hire an attorney to take a simple harassment case to court. In too many instances it has appeared that only where the harassment has been very longstanding, caused great amounts of damages, and/or has affected many tenants under a given landlord’s thumb; does the economics become such that an attorney can fully prosecute the case, get paid for their professional fees and costs incurred, and still allow for a just and reasonable recovery for those harmed. More often, tenants have felt their only viable option when harassed by their landlord is to avoid the aggravation, give up their home and move out. Proposition M empowers tenants to seek recourse themselves through the Rent Stabilization and Arbitration Board; a relatively quick, cheap and efficient means of recourse to a previously difficult and lengthy problem.

In addition to extending Rent Board “decrease-in-services” petitions to encompass harassment, Proposition M grants to tenants that, when the landlord attempts a bogus eviction, attorney fees and court related costs will be paid by the landlord. Landlords will often try to evict tenants based on false claims, forcing a tenant to go through lengthy eviction proceedings with the financial burden of hiring an attorney, just to avoid being dispossessed. With Proposition M, a tenant facing a bogus eviction can now seek legal representation and shift the financial burden of defending the eviction to the landlord who instituted it.

With the passage of Proposition M, tenants have more to be encouraged about regarding the housing situation in San Francisco. (Also encouraging are the strong results by progressive candidates in the various races for Board of Supervisors.) Over the past summer, tenants voted overwhelmingly to protect the Rent Ordinance by voting down California Proposition 98, with a 61 percent to 39 percent victory, and now Prop. M serves as another link in the progress of renters’ rights in San Francisco. While many progressives hoped several other propositions would have been voted differently this election, with Prop. M it appears that we the renters of San Francisco have again spoken our minds, unified, to protect us from the greed and speculation which constantly threatens to overturn the housing market and to disrupt the lives and security of those who try to make this city Home.

This entry was written by Caroline Lee and Ari.

Bold Chicago Sheriff Refuses to Remove Tenants on Foreclosure Evictions

2008-10-10T14:19:00.000-07:00

According to a press release Wednesday, October 8, 2008, the Sheriff of Cook County, Illinois (which includes Chicago and its closest suburbs) has decided to suspend foreclosure evictions in the wake of the growing mortgage crisis. Sheriff Thomas J. Dart made the decision to suspend the evictions as his department was on pace this year to conduct a record number of evictions, with evictions from mortgage foreclosures reaching unprecedented levels.

Sheriff Dart had become aware and uncomfortable about a trend we've been following for some time: the increasing evictions that involve innocent renters who have paid their rent and done nothing wrong. Often these tenants are not given notice of the foreclosure or eviction, and do not know that their landlord is behind on mortgage payments or that the property is being foreclosed, until they get the sheriff's notice telling them they have to move right away. As Sheriff Dart indicated in a press conference reported by the Associated Press: in too many cases a tenant has gone off to work one morning only to have the sheriff deputy come to the house while they are away, remove their belongings to the street corner, slap up a notice and bolt the door. By the time the tenant returns from work, most of their possessions are gone, and the tenant has nowhere to go.

"We will no longer be a party to something that's so unjust," said Dart at the news conference.

Sheriff Dart grounds his refusal on what he describes as a regular failure by the foreclosing banks to investigate the occupancy of the properties before requesting an eviction, as required. As stated in the press release:

“These mortgage companies only see pieces of paper, not people, and don’t care who’s in the building,” Dart said. “They simply want their money and don’t care who gets hurt along the way. On top of it all, they want taxpayers to fund their investigative work for them. We’re not going to do their jobs for them anymore. We’re just not going to evict innocent tenants. It stops today.”

The Sheriff is holding out for the establishment of a legal safety net for these tenants, including: requirements that the mortgage companies provide additional information to the Sheriff's office regarding who is being evicted; and greater and earlier notification to tenants that their building is in foreclosure. Sheriff Dart argues that the mortgage companies and their attorneys should do more leg work in advance of an eviction, rather then have the sheriff deputies surprised to find themselves pushing an innocent renter from their home, and the renters surprised to find themselves suddenly without a home.

As reported in the AP article, Dart said that banks will have to present his office with proof that the home's occupant is either the owner or has been properly notified of the foreclosure proceedings. The law already requires this, but the law has been routinely ignored with Mortgage companies often simply evicting the named owner, or sometimes amending their papers after filing to include the tenants, but not proffering service of the court papers to the tenants at that point or at any point.

Some attorneys have requested that Dart be held in contempt of court for refusing to carry out Orders of eviction on unnoticed and unsuspecting tenants. The Illinois Bankers Association even released a statement accusing Dart of 'vigilantism.' So far, no judge has issued any Order of contempt against the Sheriff.

According to the press release, foreclosures in Cook County have been going up since 1999 and the number of foreclosure evictions has almost tripled in just two years.

“The people we’re interacting with are, many times, oblivious to the financial straits their landlord might be in,” Dart said. “They are the innocent victims here and they are the ones all of us must step up and find some way to protect.”

"That number (of foreclosures, and related evictions) will continue to get bigger" said Sheriff Dart at the press conference. He reiterated the need for innocent renters to have adequate notice before being evicted.

"You are talking about a lot of people in rental situations living paycheck to paycheck," he said. "To think they are sitting on a pool of money for an up-front deposit, security deposit, is foolishness."

As reported in the Chicago Sun Times, a community group in the Chicago neighborhood of Albany Park alerted Dart to this injustice when several members who were tenants in a neighborhood apartment building nearly were thrown out by deputies due to an outright scam. The owner of their property had filed condo-conversion parperwork, then took out substantial loans on each unit of the building allegedly for upgrade and renovation to the units pursuant to the conversion. Without doing any of the work, he took the money and escaped overseas. The bank moved to foreclose on each unit, and the deputies showed up to find the units occupied by paying tenants rather than the owner/scam-artist. The community group then went to Dart. Their investigation found similar scams were not uncommon in the Chicago markets.

Sheriff Dart also submitted an Op-Ed about the suspension of foreclosure evictions to the Chicago Sun-Times. There are also reports on this story at the Chicago Tribune, CNN, and the New York Times.

We applaud Sheriff Dart's bold and principled leadership on this issue, and hope that awareness of the plight of these innocent renters caught in the foreclosure crisis will continue to grow, and that Chicago and other areas -- especially those with high populations of renters -- follow suit and move swiftly to enact common sense regulations and procedures to protect these renters.

BE ALERT CALIFORNIA!

2008-10-01T14:38:00.000-07:00

BE ALERT CALIFORNIA! Don’t allow slick public relations people and political handlers to sway your decisions. Demand that tough concerns be addressed. With election season in full swing and election day less than 6 weeks away, countless propositions are on the November ballot, and at first glance some look appealing. However, don’t forget to read the fine print.

Proposition 6 is one such initiative that deserves deeper thought and scrutiny. In a recent article in Beyond Chron, Dean Preston outlines the implications associated with California Proposition 6, which has been described as a "comprehensive anti-gang and crime reduction measure." On the surface, Proposition 6 seems to be a step in the right direction to help create safe neighborhoods by allocating $10 million annually to "Safe Neighborhoods Compliance Enforcement Fund." However, everything has strings attached, and here these strings are tight. With this allocation of dollars, comes the requirement that all state subsidy recipients, including both Public Housing and Section 8 tenants, undergo annual background checks. These would be on top of the strict background checks that recipients already undergo just to qualify for the subsidy programs. The proposed annual background checks would be not only invasive, but costly. Under Proposition 6, funding only partly comes from the new sources identified in the proposition, and the remainder would be paid by local housing authorities; the very agencies that are already incredibly under-funded and overworked.

Proposition 6 is not limited to subsidized renters, but it also impacts the private rental market. The measure would empower the government to evict any or all tenants in a building deemed to be a nuisance for gang related criminal activity. The problem is that the definition of such a nuisance, under Penal Code section 186.22a, as quoted in Beyond Chron, is "every building or place wherein or upon which criminal conduct by a gang member takes place." So if a single resident is called a gang-member by the government, then any criminal activity no matter how minor can lead to sweeping and mass evictions from the property. Currently, the government has no right or authority to pursue evictions in the private rental market, only landlords can do so. Proposition 6 changes that dynamic. Given our current failing housing market and culture of inequality, should we really be creating another avenue for displacement of low income renters? While Proposition 6 is intended to make communities -- particularly low-income communities – safer, it may put at risk the very people it aims to help.

The same can be said for Mayor Gavin Newsom’s recent attempts to create safer streets. In the San Francisco Bay Guardian, Amanda Witherell outlines Newsom’s San Francisco Streets and Neighborhoods workgroup and its recent meeting: "to analyze and understand the key issues impacting safety on our streets and formulate recommendations for needed improvement with the goal of creating a safe environment on our streets for everyone." The main concern of this street safety meeting according to Ms. Witherell was not violence specifically, but rather the homeless. From her analysis, the meeting missed the point entirely of safety – focusing instead tangentially on "drug dealing, aggressive panhandling, blocking the sidewalk, public urination and defecation, littering (and) intimidation."

Not that homelessness-related issues aren’t important when speaking of street safety, but the more serious safety issues facing San Francisco residents require immediate action. There has been a recent surge of murders in the Mission, with the San Francisco Chronicle noting that, "six people have been slain in the past two weeks." Fatalities in the Western Addition and Richmond districts, and vigils to raise awareness of the killings and violence, take up much of our prime time news hour. Yet, when task forces are convened, the heart of the issue is missed.

Seth Katzman of the Human Services Network aptly stated, "We have tenants and clients in the Tenderloin who are afraid to go out of their buildings at night because of drug-related violence. They’re not complaining to us about people peeing on the streets...No one likes it, but that’s not the big issue right now." However, rather than addressing these pertinent issues, Mayor Newsom’s meeting focused on enacting special enforcement and enhanced penalties for VIP sections of the city – the places where the ‘Very Important People’, eat, sleep, sight-see and shop (including Yerba Buena Center, Fisherman’s Wharf, Chinatown, and Union Square). Thankfully Jennifer Friedenbach, representing the Coalition on Homelessness, defended people who have nowhere to go with hard-hitting comments. It was reported that she was "sarcastically suggesting they have a registration for homeless people entering certain areas of the city," and that she later stated: "‘When you say sitting and lying on the sidewalk, that is targeting people who don’t have a place to sit.’"

Mayor Gavin Newsom’s agenda for this meeting demonstrated the desire, on the surface, to remove the eyesore and irritation of homelessness rather than addressing real safety issues and enacting progressive policy to create better enforcement in the neighborhoods of concern. Moreover, Proposition 6 seeks to clean up neighborhoods by merely kicking people out of their housing and by default, onto the streets. Both of these attempts at change miss the point entirely. We have violence, we have homeless people and we have a lack of affordable housing. We need to address the causes of each of these issues, rather than the effects, for the process to bring about any meaningful and effective change.

So consider these important issues when voting on Proposition 6; read the fine print on the ballot and demand that our elected officials address the real issues.

Tent Cities Sprouting Across America as Homelessness on the Rise

2008-09-19T14:58:00.000-07:00

The Associated Press, via CNN.com is reporting today on the sudden appearance of "tent cities" in cities across America including a camp in Reno holding 150 homeless. The Reno camp is in a space where new homeless shelters are slated to be built.

The phenomenon is also on the rise in places such as: Portland, Seattle, San Diego, Fresno, Santa Barbara, Athens Georgia, Chattanooga Tennessee, and Columbus Ohio.

Following is an excerpt from the story (you can read the whole article here):

From Seattle to Athens, Georgia, homeless advocacy groups and city agencies are reporting the most visible rise in homeless encampments in a generation.

Nearly 61 percent of local and state homeless coalitions say they've experienced a rise in homelessness since the foreclosure crisis began in 2007, according to a report by the National Coalition for the Homeless. The group says the problem has worsened since the report's release in April, with foreclosures mounting, gas and food prices rising and the job market tightening.

"It's clear that poverty and homelessness have increased," said Michael Stoops, acting executive director of the coalition. "The economy is in chaos, we're in an unofficial recession and Americans are worried, from the homeless to the middle class, about their future."

The phenomenon of encampments has caught advocacy groups somewhat by surprise, largely because of how quickly they have sprung up.

"What you're seeing is encampments that I haven't seen since the 80s," said Paul Boden, executive director of the Western Regional Advocacy Project, an umbrella group for homeless advocacy organizations in the California cities of Los Angeles, San Francisco and Oakland -- and in Portland, Oregon and Seattle, Washington.

Vote Yes on Prop M This November to Protect San Francisco Tenants From Harassment by Landlords

2008-09-12T16:34:00.000-07:00

This November, not only will San Franciscans be voting for President of the United States, there are dozens of State and Local propositions which will be put to a vote. We will be covering some of these in greater detail as the election approaches.

But be aware already there is a great local measure, Prop M, which if passed will amend the San Francisco Rent Ordinance to allow tenants to petition the Board for rent decreases when they are being harassed by their landlords.

Many landlords in San Francisco regularly use harassing conduct to convince their rent-controlled tenants to give up their homes, thus avoiding the protracted, contentious, and expensive litigation which often comes with an eviction attempt under the Ordinance's "Just Cause" provisions. In addition, the "no fault" just causes under the Ordinance, such as removing the property from the rental market via the Ellis Act, often require landlords to provide time and money to the evicted tenant, and often have lasting negative effects on the value of the property where the evictions took place.

Because of this, some landlords are making regular tenant harassment a regular, even cost-efficient, method of conducting business. Tenants often have to endure such measures for years, carefully documenting them, until their damages build to such a point that they can have an attorney bring suit against the landlord in Civil Court. Many more simply move out of their homes from the frustration before it gets to that point.

This measure would allow tenants to petition the Rent Board when being harassed by their landlords, just as they can now petition the Board if their services are decreased or if their landlord improperly raises the rent. The Rent Board petition offers a quick and cheap method to obtain a rent deduction for the landlord's harmful and wrongful conduct. Should this measure pass and go into effect, the widespread use of tenant harassment as a landlord business practice could be curbed significantly.

Landlord interest groups are sure to fight hard against this measure politically (and have already started doing so) and will likely mount legal challenges to the measure even after it is passed. But the voters should make clear that widespread tenant harassment in San Francisco is unacceptable.

As the tenant union states in a flyer offered on its website:

Actions like threatening tenants with physical harm, starting repairs but never finishing them, demanding private information like citizenship status or Social Security numbers, illegally entering the tenants’ apartment, or failing to accept rent from tenants will all be defined as harassment and prohibited by our rent control law. Proposition M will also help tenant fight off serial, bogus eviction notices by making sure tenants get attorneys fees whenever a landlord issues bogus eviction notices.

We will follow the political progress of this and other important State and Local measures as the election approaches. Stay tuned!

San Francisco Supervisors Weigh in on Black Displacement

2008-08-21T15:06:00.000-07:00

A string of articles have been published regarding the displacement of San Francisco’s African American population, the most recent of which is titled Black Exodus Emergency by Sarah Phelan in the San Francisco Bay Guardian. Sarah Phelan outlines the plight of the African American Out-Migration task force, put together by Mayor Gavin Newsom last year. It recently issued a draft report demonstrating the harsh reality -- based on 2005 US Census and state demographic data -- that the African American population constitutes a mere 1/16 of the city’s population, a number that has decreased by 40.9 percent since 1990. “‘That’s not enough people to fill Candlestick Park,’ observed Fred Blackwell, executive director of the San Francisco Redevelopment Agency.”

And this is not a new phenomenon. In response to San Francisco’s history of displacement, specifically the urban renewal projects of the 1950s and 1960s in the Fillmore area and in Hunters Point in the 1970s, the San Francisco Board of Supervisors will vote on a Mayoral supported proposal on September 9th. If passed, it would extend housing reparations in the form of certificates allowing the recipient to jump to the front of long affordable housing lines, not only to the original tenants who were displaced but to their descendants as well. “They would be put at the top of the city’s lottery system that awards much-coveted affordable housing units,” reported Leslie Fulbright in the SF Chronicle on August 18th, 2008.

I applaud this proposed legislation as a symbol of making something right within a history of wrong. However the question must be asked, is this too little too late? It may not even be feasible to expect past residents and their families from forty-plus years ago to jump at an offer of a high lottery position certificate for a chance to move back to San Francisco. According to Fred Blackwell, executive director of the San Francisco Redevelopment Agency (as quoted in the Guardian article), the city has a “lack of affordable housing, as well as a lack of educational and economic opportunity, severe environmental injustice, an epidemic of violence, and lack of cultural and social pride.” I agree with Supervisor Ross Mirkarimi's statement to the Chronicle: “I highly doubt there will be a flood of people coming in to redeem them (the certificates).”

So what do we do in response to the African American depopulation? We must start by preserving and improving the housing supply that already exists. A watchful and critical eye must be placed on the Redevelopment Agency’s new plan to “clean up” Bay View-Hunters Point, one of the few predominantly African American neighborhoods remaining in San Francisco.

From the San Francisco Chronicle, August 18th, 2008:

If you, a parent or grandparent lived in the Western Addition in the 1950s or 1960s or Hunters Point in the 1970s, you may be eligible for a housing certificate of preference. To find out, call the San Francisco Housing Development Corporation at (415) 822-1022 or the Mayor’s Office of Housing at (415) 701-5500

SF Chron: Foreclosure Crisis Victimizes SF Tenants

2008-08-15T14:18:00.000-07:00

The Chronicle today published a good if somewhat belated piece documenting the fallout of the ongoing housing and foreclosure crisis on San Francisco and Bay Area renters. As we've been hearing for months, the banks foreclosing on properties and the agencies they hire to 'manage' the properties and prepare them for resale often have been neglecting and abusing the tenants in those properties, tenants who have done nothing wrong. These tenants have been subject to repeated aggressive demands to move out, and have sometimes had their utilities abruptly (and wrongfully) cut, leaving them in untenantable conditions, as the agents try to exert pressure on the tenants to leave the property vacant so it can sell higher and more easily.

As reported in the Chronicle, SF tenants' rights and protections are supposed to continue after their landlord's property has gone into foreclosure. However, tenants do not always understand their rights or the extent of their protection in these situations, and the banks and property agents are not always interested in learning (or following) the laws. Many are relatively new to the business of landlording -- especially in a strong rent- and eviction-control jurisdiction -- and their design for these properties is nothing more then to turn them over quickly for the highest price they can muster. The tenants are all too often disregarded, neglected, even harassed as they are seen more as an obstacle to the banks' bottom line rather than as humans with legitimate needs and rights in their homes.

Any S.F. tenant whose landlord has been foreclosed upon, and who is now being told or pressured to leave, or suffering from unilateral lease changes instituted by agents for the foreclosing banks -- stand up for your rights! Contact one of the supportive agencies (there are some links on the left side of this blog page) or a qualified attorney specializing in (and dedicated to) the needs and rights of tenants. Find out your options, and where possible you may be able to successfully fight off the bank, and maintain the quiet enjoyment of your home.

Our own Ken Greenstein was interviewed for the article, and was quoted therein. Excerpts appear below (follow this link to read the whole article):

In early June, a handwritten note appeared on the front door of Bing Ling Zeng's San Francisco apartment, written in a language she couldn't understand.

"You will be needing to vacate this property soon," it said.

The following month, Pacific Gas and Electric Co. shut off the power. The food in the refrigerator spoiled, forcing Zeng to go out several times a day to buy groceries and milk for her three young children. Her 62-year-old mother-in-law couldn't recharge her electric wheelchair.

Zeng and the other Chinese family sharing the space hadn't fallen behind in their rent or bills. The only thing they did wrong was to lease an apartment from a landlord who fell into foreclosure, an unforeseeable mistake that hundreds are grappling with across San Francisco.

Tenants' groups around the city report a sharp rise in such cases, as lenders repossess growing numbers of local homes. Renters are being told to leave, are living in the dark or are receiving little response to their complaints as their homes fall into disrepair.
* * * * *
The issue was virtually unheard of a year ago. The San Francisco Tenants Union had to circulate a memo to its counselors earlier this year because few had ever encountered it before.

The exact number of tenants dealing with the aftermath of a landlord foreclosure is difficult to ascertain. Three tenants groups contacted by The Chronicle reported around 130 cases this year, but most counselors believe that many more tenants aren't contacting the organizations. What is known is that lenders foreclosed on 492 homes in San Francisco during the last year and a half, according to DataQuick Information Systems.
* * * * *
Unless tenants have stopped paying rent or otherwise have misbehaved, generally they can be forced out only when a new owner plans to demolish the property, has secured the necessary approvals to convert into it condominiums or plans to move in family members or him or herself, according to the city's rent ordinance. Even then, the owner typically must provide several months' notice and thousands of dollars in relocation costs.

In addition, new owners - a bank, a trustee or otherwise - generally become liable for the same obligations of the previous landlord, said Robert Collins, deputy director of the San Francisco Rent Board. That means that if the original lease said the landlord pays for electricity, as Zeng said was the case for her Excelsior apartment, the company that bought it is responsible now.
* * * * *
Even if the law is largely on the tenants' side in these circumstances, relaying the rights of tenants and responsibilities of landlords is a challenge, said Ken Greenstein, partner at San Francisco tenant law firm Greenstein and McDonald.
* * * * *
If a renter is harassed into leaving an apartment, or if he or she vacates without receiving the proper amount of notice or relocation money due under local regulations, that person could have a case to sue, Greenstein said. Likewise, when a new owner doesn't pay for or shuts off utilities, the tenant could have grounds to sue under the state civil code, he said.

But tenant protections do have their limits. While Zeng and her family probably can't be evicted by the current owner, she remains worried about what will happen when the building is sold again, as Medina says the company intends to do. The new owners may want to move in, which probably would allow them to begin legitimate eviction proceedings.

"It will be very difficult to find a place we can afford in San Francisco," Zeng said through a translator, adding that rents have increased and landlords often don't want to lease to families with children. "We're very scared that we won't be able to find a new place to live. It makes me very sad."

Squatters Occupying Foreclosed Homes in Miami

2008-08-12T17:04:00.000-07:00

There's an informal squatting program in Miami, Florida, which was created by a Miami affordable housing group called Take Back the Lands. There were more than 26,000 foreclosures in Miami-Dade County last year, which is about a three-fold increase from 2006, according to Tristam Korten, in an article she wrote for a article in Mother Jones magazine in the May/June issue.

Take Back the Lands (hereafter "TBL") has put a large number of families into housing and has 14 families on its waiting list to squat new homes. TBL calls it "liberating the housing." Of the 26,000 foreclosures last year alone, a multitude of those along with this years foreclosures remain vacant. As an aside, this is a nationwide problem, including right here in the Bay Area. I just saw a piece on KRON News yesterday, showing half a neighborhood in Antioch, California which has vacant houses.

The way the squatting usually transpires in the TBL program, is staff from TBL "will break in, change the locks, paint and clean, innovate a way to connect water and electricity, and then move a homeless family into the house. The criminal laws they'll violate in the process range from trespassing to breaking and entering (even burglary, if the police get ambitious), which requires the organization to keep a pro bono lawyer on standby," according to Korten in the Mother Jones piece.

"As far as the neighbors are concerned, the current tenants—squatters though they are—are a vast improvement over the crack den the vacant house had become. One neighbor even loaned the family electricity via an extension cord until a mysterious man sympathetic to Take Back's cause turned on power at the house."

TBL also helped erect a shantytown for the homeless on a vacant city lot in 2006 and it lasted for 6 months until it was accidentally burned down. TBL employees are aware that their program and the actual squatting is against the law, but they believe it is more important to have people housed than the possible criminal prosecutions that could occur.

As a lawyer I can't officially advocate illegal conduct, but clearly with the current economic downturn and the homeless population on the rise in the U.S., our citizens are having to become more creative about housing. There is a severe shortage of public housing and often nowhere to turn for people who lose their homes for one reason or another.

Beware the fake rental scam

2008-08-01T15:49:00.000-07:00

As reported on the website of KCBS/CBS5 earlier this month (link), an old scam has been resurrected in the Bay Area due in part to the current mortgage foreclosure crisis. Scam artists are breaking into vacant homes up for sale, changing the locks, removing the "for sale" signs, and then marketing the places for rent.

Victims of the scam see a place they'd like to rent, and then make deals with the scammers, often paying first and/or last month's rent and a security deposit in cash -- in exchange for a "lease" and keys. Only later do they find out their "lease" is a fraud and that they have no rental agreement with the owners. By this time the fraudulent "landlord" is long gone, and the victim is out of considerable money and may be put out of the home with very little recourse available.

Beware a landlord or rental agency which requires initial payments in cash. Also, as suggested in the article, it is prudent to check that the rental agency is licensed with the California Department of Real Estate (here) or check the property owner's name against records kept in the county recorder's office (in San Francisco, the office of the assessor-recorder is on the first floor of City Hall, and recent ownership records may be looked up quickly and for free on computer terminals set up there in the "public access" area of the office.)

$29 Million Award in Fresno Fire for Family of Tenants

2008-07-18T17:19:00.000-07:00

Relatives of a 19 year old man, his fiancee, their two month old daughter and her two siblings The Fresno Bee reported who died in an apartment fire in July 2007, received an arbitration award of $29,000,000. The verdict was one of the largest in Kings County history.
The verdict was against Lenmore Real Estate and Property Management.

The evidence showed the Lenmore knew that most of the units did not have smoke detectors installed 6 months prior to the fire. The owner settled out of the case for $1 million prior to the arbitration. The case was assigned to an arbitrator out of Southern California, Judge Daniel Pratt, who was retired.

"Pratt ruled in favor of the plaintiffs after hearing one day of testimony from Lemoore residents, firefighters and investigators. Pratt also viewed photographs of the plaintiffs who cried as they stood helpless outside the burning units" according to the Fresno Bee.

"Pratt awarded Poliquit and Mattison $4 million each in damages for the loss of their daughter, Michell, and their granddaughter, Hayden. Bernadette Faubion also received $4 million for the loss of her son, Derik, and her granddaughter, Hayden. The judge also gave Poliquit and Bisnar $2 million each in damages for the loss of their children, Ariel and Lexus. In addition, Poliquit received $5 million in damages for emotional distress for witnessing the fatal fire. Bisnar and Mattison and Bernadette Faubion received $2 million each, and Sue and Duncan Faubion received $1 million each for emotional distress."

Not Only Credit Bureaus Damage Tenancy Records

2008-07-11T17:26:00.000-07:00

Tenants who are being wrongfully evicted by landlords are being screwed in more ways than they ever know. It is one thing if a tenant does not pay the rent and the landlord takes that tenant to court, gets a judgment and ultimately the eviction judgment for the money owed and for possession of the rental unit, and then that judgment is reported to the 3 major credit bureaus (Equifax, Experian and Transunion). But when a tenant has done nothing wrong and is illegally evicted, there is a company that picks the eviction up and keeps that information indefinitely. The company is named First Advantage Saferent, formally known as the Unlawful Detainer Registry. First Advantage (hereafter "FA"), has its workers go to courts and puts all eviction actions into its database. There's an excellent website (http://www.caltenantlaw.com) by an attorney Ken Carlson of Idyllwild, CA, which describes how FA works in depth.

There are numerous laws in the California Civil Code being violated by FA. If you are a tenant who has wrongfully evicted through the court system I recommend you contact us or some other tenant attorney. You should also contact FA at (800)999-4010 and work to have your tenancy record that they have in their database expunged. It could take some patience and dilligence, but hopefully you will prevail. Also, a class action lawsuit has been filed against the Unlawful Detainer Registry (aka FA) by Jeff Wilens (website: http://www.lawyers.com/lakeshorelaw; phone: (949)709-5330) in Mission Viejo, CA (source). If FA will not clear your record and you prevailed in an Unlawful Detainer or the case was dismissed or it settled short of trial, then you should join the class action lawsuit. You may be entitled to up to $10,000 under Civil Code Section 1786.50.

There are other companies which have databases for landlords. One of the newest ones, donotrentto.com, appears to be at its inception, but is one that will likely grow and do serious damage to tenants who have been wrongfully evicted through the courts.

These battles with these unethical companies are important to protect tenant rights. The only way to get these companies is if the aggrieved tenants take action by joining legal cases, reporting the FA and others to govermental regulatory agencies and to one's politicial representative. Hopefully FA will be driven out of business at some point by lawsuits and stronger laws.

Companies Secretly Fund Purported Objective Studies to Support Legal Defenses

2008-07-03T16:33:00.000-07:00

I have long suspected that certain industries fund studies that have the appearance of independence from companies, yet it turns out are directly connected to those industries. The pharmaceutical industry comes to mind. We have seen corporate lobbyists writing bills that have been passed by Congress and State Legislatures, especially in the past 14 years after the Republicans won the House and the Senate in 1994.

In the latest edition of Mother Jones magazine in a story by Jim Morris (Sarah Laskow contributing to the research) (link), the welding-products industry is shown to have been funding studies by purported independent researching experts in various fields. It should be no surprise, that those researchers have concluded that victims (welders) of exposure to manganese, who have suffered from a disease similar to Parkinson's disease, called "parkinsonism" or "manganism", were malingering or that no causal relationship could be proven.

Court documents obtained by Mother Jones show that the welding companies paid more than $12.5 million to 25 organizations and 33 researchers, virtually all of whom have published papers dismissing connections between welding fumes and workers' ailments. Most of the money, $11 million, was spent after the litigation achieved critical mass in 2003; attorneys for the welders, meanwhile, spent about half a million.

The information was revealed during the discovery phase of a court case in federal court in Ohio, after a wise judge, Kathleen O'Malley, ordered the two sides to "provide a full and complete accounting" of payments to individuals or entities that had done studies. I must admit that I am shocked that the defendant corporations actually produced the documents which showed how they had been manipulating the studies to say what they wanted them to say.

The most blatant example in the Mother Jones article involved a researcher named Jon Fryzek, who Judge O'Malley referred to:

...whose large studies of Swedish and Danish welders found no significant link between welding fumes and Parkinson's symptoms—but the studies, based almost solely on hospital records, ignored welders who were never hospitalized. O'Malley was particularly troubled to learn that industry lawyers had reviewed a prepublication draft of the Danish study. "[T]here is no doubt that this was not simply an independent study," she wrote, "and that the experts who participated in the study are continuing to act in an advocacy capacity." Fryzek worked for Maryland's International Epidemiology Institute (iei)—known for its industry-commissioned studies, including one that found no link between radiation and cancer in uranium millers. The institute received more than $971,000 from welding defendants.

The astounding part of this whole story is that the corporate defendants in these manganese cases which relied on these biased reports have won 16 of 17 trials. I think these cases should be retried. I firmly believe that Congress needs to pass a law prohibiting the funding of studies in this way, with strict parameters being set as to how studies are funded. Unfortunately, politicians and the U.S. Supreme Court have been going out of their way to protect corporations who negligently kill and injure American citizens.

U.S. Supreme Court Rundown - Divided Court Making Waves

2008-06-27T14:46:00.000-07:00

The United States Supreme Court has been issuing opinions of great impact this term, with a flurry of decisions out this week. Nearly all decisions are very closely split, with the "conservative" four justices (Chief Justice Roberts, and Justices Scalia, Thomas, and Alito) concurring in nearly every respect, and the "liberal" four (Justices Stevens, Souter, Ginsberg, and Breyer) grouped together on the other side.

Justice Kennedy is the ninth Justice and the swing vote, siding with the groups on one side or the other and thereby clarifying (and at times changing) the law of the land.

In a few decisions, such as the well-publicized June 12, 2008 decision in the Guantanamo detainee Habeas case BOUMEDIENE et al. v. BUSH, Justice Kennedy aligned himself with the liberal four. The 5/4 decision of the court, authored by Justice Kennedy, reaffirmed the great writ of Habeas Corpus and stated its applicability to alien detainees held in U.S.-controlled military territories outside the United States, like Guantanamo Bay, even if they are classified as "enemy combatant" by the Government. Thus, suspected terrorists held by the United States have the legal right to a court hearing to challenge their detention and/or their "enemy combatant" classification.

However, in a great many decisions released this week, Justice Kennedy sided with the "conservative" four justices, and controversial decisions on a host of issues are going to have an impact on U.S. law and policy for a long time to come. Some of these decisions have been well publicized, some have largely escaped notice. Here's a quick summary of many of this week's published decisions:

- In DISTRICT OF COLUMBIA et al. v. HELLER, Justice Scalia wrote the 5/4 decision stating that the Second Amendment of the U.S. Constitution protects a pre-existing individual right to keep firearms including handguns for self-defense purposes and for protection at home. The decision overturned a 30-years-old Washington D.C. ordinance which had banned handgun possession in homes within the district, and which required other firearms in homes to be dissembled or locked with trigger locks. While the decision states that the Second Amendment right is not absolute and is subject to reasonable restrictions and exceptions, challenges are already underway to other longstanding local gun-control measures in Chicago and elsewhere. The decision is being hailed as a big win for gun-owning rights groups, while gun-control groups are spinning the decision as a moderate decision which still might allow common-sense gun-control laws to survive.

- In DAVIS v. FEDERAL ELECTION COMMISSION Justice Alito wrote the decision of the court, backed by the "conservative" bloc and Justice Kennedy. The decision overturns a campaign-finance law known as the “Millionaire’s Amendment.” Under the Millionaire’s Amendment, a person running for office -- against a candidate who spends huge sums of her or his own money on her or his own behalf -- is allowed looser restrictions in how much money the non-millionaire may raise from individual donors. The idea was to allow a poorer candidate to compete with a richer candidate who otherwise could buy themselves an election. The law also required the millionaire candidate to make disclosures of how much of her or his own money was being spent, so that it could be determined if the looser restrictions were to apply to the non-millionaire candidate. The decision here was rested on freedom of speech and equal protection grounds, essentially claiming that the law was an unlawful burden on millionaires' freedom to spend their money on their campaigns, and that by loosening the restrictions for the non-millionaire candidate only the law was unfair to the millionaire. These conservative justices are very adept at protecting rights, at least the rights of the ultra-rich and the ultra-powerful...

- In EXXON SHIPPING CO. et al. v. BAKER et al., in a 5/3 opinion (with Justice Souter joining Kennedy with the conservative bloc, and with Justice Alito taking no part in the matter), the Court reduced the punitive damages award against the Exxon Corporation, in civil suits brought after the Exxon Valdez oil spill disaster, from $2.5 Billion to just over $500 Million. The court held that maritime law required an upper limit punitive damages ratio of 1:1, meaning that the amount of punitive damages awarded in excess of the actual or compensatory damages is unfair and unlawful. While the jury in this matter initially awarded punitive damages of $5 Billion, (which was then reduced on appeal to $2.5 Billion), the actual compensatory damages awarded on the case was about $500 Million, and the supreme court held that punitive damages therefore could not be awarded in excess of that amount. A huge relief for the huge oil company.

- Joining the "liberal" bloc, Justice Kennedy wrote the 5/4 decision in KENNEDY v. LOUISIANA, holding that there could be no death penalty for persons convicted of raping a child if the victim was not killed and was not intended to be killed. Such a punishment was held to be disproportionate to the crime and thus violates the Eighth Amendment's protection against "cruel and unusual punishment."

- In a rare instance of judicial unity, the Court held in ROTHGERY v. GILLESPIE COUNTY, TEXAS that a criminal defendant's right to counsel attaches at the "initial appearance before a magistrate judge, where he learns the charge against him and his liberty is subject to restriction." The decision was 8/1, with only Justice Thomas dissenting. In Justice Thomas's lone opinion, the procedure of Gillespie County was proper, whereby it denied the accused counsel until a later court appearance which specifically involved a public prosecutor. Justice Thomas would so hold even given the facts of this case, where a wrongfully accused man (due to a database error misidentifying him as a felon) was jailed twice and forced to raise substantial bail, all before he was ever granted an attorney. Once he had an attorney it was a simple matter of having the attorney file a bit of paperwork to clear the database error and have the man released. The nearly unanimous opinion of the Court upholds the substance and intent of the Sixth Amendment right to counsel.

New York Landlord Takes Over Sections of Residential Building

2008-06-20T18:14:00.000-07:00

In the New York Times on June 15th, there was a story by Marc Santora (link) about a young landlord (only 37) and his family, trying to turn a big apartment building in the East Village into a mansion. The only problem for the Economakis family was that most of the tenants in the 15 units had rent control and were willing to fight to keep their homes.

[T]hese dreams have turned into a five-year nightmare including three court rulings, the most recent from the State Court of Appeals this month; countless letters written by lawyers; dueling Web sites; and dozens of skirmishes over the use of air-conditioners and the positioning of flowerpots. The Economakises reached financial settlements with six of the original occupants, turning those units into a three-story space for themselves and a duplex for guests. Now that the Court of Appeals has sent the case back to housing court, lawyers estimate a resolution could still be two years away.

At its core, the fight involves a law allowing landlords to displace rent-stabilized tenants if the landlords will use the space as their primary residence. The Economakis family has prevailed, thus far, on the principle that the law applies even to a building this large. But the tenants continue to press the notion that given the scope of the proposed home — which calls for seven bathrooms, a gym and a library — the owners are just trying to clear them out so they can sell the building off to become so many market-rate condos.

This story is instructive for S.F. tenants in large buildings because there is the possibility of this happening to them. Usually landlords will use the Ellis Act, which means they have to remove the building from the rental market for 5 years. Often the landlord will then sell the individual units as a Tenancy in Common. The owner of Skyy Vodka is known to have taken over a whole property in S.F. and turned it into his family's home. It is so unjust how some of these greedy landlords could care less about their tenant's long-term homes, all for the mighty dollar. Some people just can never get enough money.

SF Rent Board Closes Loophole, Clarifies that Disabled Persons Receive Eviction Protection Regardless of Income

2008-06-12T13:02:00.000-07:00

As reported yesterday by Paul Hogarth of BeyondChron (an excellent online alternative daily news source with a progressive slant and a locally oriented focus), the San Francisco Rent Board at their public meeting Tuesday, June 10, 2008, approved a change to their rules and regulations, making fully clear that disabled tenants are protected from Owner-Move-In evictions (which are often used by landlords as a pretense for speculative purposes, to free units of long-term rent-controlled tenancies prior to offering the property for sale, or simply to jack up rents to market rates), regardless of their income status.

Previously the regulations had a loophole in that they referenced the qualifications for SSI (supplemental security income - a welfare system for elderly and disabled persons with limited means) as a determining factor, without clarifying that it was the definition of 'disabled' under SSI which was to be determinative. Since SSI also has a "means test" to determine eligibility -- meaning that persons with certain minimum income or assets are not eligable -- some landlord advocates have been arguing that the same means-testing should determine eligibility for the eviction protections in the Rent Board regulations.

At the Tuesday meeting, the Board confirmed that the intention of the regulation is to protect disabled tenants, with no means test involved. This closes the loophole which landlords have been exploiting, and represents a solid step toward tightening the common-sense tenant protections which San Franciscans have been favoring over recent years -- including the disability protections passed by voters as Prop G in 1998, designed to protect just such disabled San Franciscan tenants.

For the full article: see here.

Gerry Spence Wins Final Case

2008-06-06T11:10:00.000-07:00

Gerry Spence, one of the most renowned trial attorneys in U.S. history, prevailed in his final case before retirement earlier this week. He went 50 years without losing one criminal defense case and he was made famous by securing a $10.5 million verdict for the family of Karen Silkwood and for helping to defend O.J. Simpson. He is the author of 16 books.

This last case was tried in Detroit federal court and involved an attorney, Geoffrey Fieger, who was accused of making illegal campaign contributions to John Edwards. The indictment was especially suspicious because it was made against a well known supporter of Democratic candidates by a Justice Department which has flagrantly violated numerous laws. Information on the case this week is available at http://www.mlive.com/... and http://www.newsobserver.com/1565/story/1093505.html.

Prop 98 Loses!

2008-06-05T15:30:00.000-07:00

Proposition 98, the California initiative which would have banned rent control and other important tenant protections, lost on Tuesday by more than 20 percentage points in a major victory for tenants, environmentalists, retired persons and a broad coalition. Tenants throughout California celebrated the hard fought win. We want to congratulate all of the activists and organizations who helped make this victory possible.

However, landlords and other property owners have vowed not to give up the fight. They now intend to take it to the State Legislature in an L.A. Times article. I don't think they have much chance of getting a new law passed, at least not until the Republicans control the State Legislature, a day which hopefully which will not come.

Vote on June 3rd, NO on 98, Yes on 99

2008-06-02T13:02:00.000-07:00

The vote to outlaw rent control and just cause for eviction is TOMORROW, so people need to make sure to vote NO on Prop 98. If Prop 99 gets more votes than Prop 98 then it will supercede a yes vote on 98.

The latest Field Poll from last week of likely voters shows Prop 98 losing 43 to 33, but about 20 percent are undecided. Also, June usually has low voter turnout, so make sure to cast that ballot.

Broad Coalition Opposes "Hidden Agenda" Behind Proposition 98

2008-05-15T14:28:00.000-07:00

While we cannot urge strongly enough that all California voters make sure to vote June 3 against the horrible Proposition 98 -- which would decimate rent control, environmental protection and land-use regulations across the State -- we have been seeing encouraging signs that Californians from all walks of life are seeing this measure for what it is and might turn out to ensure its defeat. A very broad coalition of representatives and groups are coming out against the hidden agenda of the pro-Prop-98 backers and financers (ie. landlord groups).

If you or anyone you know is on the fence about this proposition, just look at the overwhelming breadth opposition to this terrible measure hiding an insidious agenda. The coalition endorsing NO on Prop 98 includes the following (this is a very partial list; see here for a more complete list):

Governor Arnold Schwarzenegger (breaking with the California GOP)
Former Governor Pete Wilson
California Democratic Party
League of Women Voters of California

Speaker of the House, U.S. Rep. Nancy Pelosi (D-San Francisco)
U.S. Senator Dianne Feinstein
U.S. Senator Barbara Boxer

AARP
Senior Action Network

California Chamber of Commerce
Association of California Water Agencies
California Council for Environmental and Economic Balance (CCEEB)
Consumer Federation of California
Consumers Coalition of California
League of California Cities

National Wildlife Federation
Audubon California
California League of Conservation Voters
Natural Resources Defense Council
Sierra Club California

California Professional Firefighters
California Police Chiefs Association
California Teachers Association

Housing California
California Housing Consortium (CHC)
League of California Homeowners

California ACORN
Western Center on Law and Poverty
California Partnership
California Alliance

California Labor Federation
SEIU California State Council
State Building and Construction Trades Council
American Federation of State, County and Municipal Employees (AFSCME)

Los Angeles Times
San Diego Union Tribune
San Francisco Chronicle

138 Monte Cresta Tenants' Constructive Eviction Action Gains Publicity -- rent board action may bring policy changes in Oakland

2008-05-08T14:06:00.000-07:00

Greenstein & McDonald has brought an affirmative lawsuit on behalf of current and former tenants of 138 Monte Cresta Ave., Oakland, for constructive eviction and related claims against owner/developer/speculator Dennis Cox. Mr. Cox's attempt to "pass through" an exorbitant rent increase on these long-term tenants -- under a loophole in Oakland Ordinance regarding "debt service" -- and his campaign of unceasing disruptive construction at the property has been forcing the rent controlled tenants to vacate their homes of several decades. Those who have remained continue to suffer yet fight for their rights and their homes.

The Monte Cresta clients won their Rent Board case, but on appeal the Rent Board referred the case back to the hearing officer. They also hired an expert to evaluate the loans of Mr. Cox to see if the pass through of the debt was commercially reasonable.

We have another Oakland case with similar facts and our client won her rent board case. The Hearing Officer at the Rent Board ruled that the LL could not pass through his loan. The same expert hired by the Rent Board to look at the Monte Cresta case on appeal, was the expert who advised against the debt pass-through in this other case we have. So we are cautiously optimistic about the outcome of the Monte Cresta rent board case.

The Monte Cresta lawsuit is in its early stages, but already the defense has been very aggressive, grasping at anything to kill the case or at least to drag out the process and make the case more costly to pursue. They filed a motion to have the entire case thrown out, alleging that the Defendant's rent increase was protected activity under First Amendment "free speech" clauses and alleging the case infringed on his right to petition government bodies. The motion argument was such a stretch as to border on nonsensical, and the Court was not persuaded. The case now pushes on through the discovery process, with each side gathering evidence and producing it to the other so the strengths and weaknesses can be analyzed.

Prior to the affirmative action, the tenants have been fighting the rent-increase at the Oakland rent board, and the case has brought Oakland to consider new policy to close the "debt-service" loophole. The matter has gained a lot of interest, most recently in a fascinating feature in the East Bay Express. Below we reprint a few choice excerpts; read the full Article -- including the heart wrenching stories of individual tenants caught in Mr. Cox's cold speculative business exercise -- here.

Stay tuned to the Greenstein & McDonald Tenant Law Blog for further updates on this case.

Meet the tenants of 138 Monte Cresta Avenue. What are they so upset about? In two words: Dennis Cox. Shortly after buying their apartment in May of 2007, Cox notified them that he was increasing their rent by $381 a month. He probably didn't suspect he was about to unleash a storm likely to shape rental policies for the whole city.
* * * *
Oakland's rent-control regulations say that landlords can raise rents to cover maintenance expenses plus 95 percent of the debt service on their mortgage. However, Cox took out an unconventional mortgage, and that's where the controversy began. * * * (H)e chose... to obtain an unconventional mortgage — an interest-only loan with a high 10.5 percent rate and a short, two-year repayment period. Cox put down a quarter of the purchase price, and his private lender demanded additional collateral beyond the building itself. So he secured the loan with a second piece of property, which some tenants would later cite as proof that he was trying to cheat them.
* * * *
The tenants said their landlord's costly loan was an intentional effort to undermine Oakland's rent controls. They implied that Cox had taken out a larger loan than necessary to provide the legal justification to raise their rents by more than the city's 3.3 percent rent cap....

When the hearing officer handed down her ruling in November, the tenants scored a huge victory. In what James Vann of the Oakland Tenants Union called "a watershed decision," the hearing officer concluded that Cox' loan was not "commercially reasonable" and froze building rents at their existing levels.
* * * *
But despite the ruling, the dispute is far from resolved. Cox has appealed the decision to the full rent board, and it could well end up in court. In the meantime, reverberation from the case, and dozen of others like it, has prompted the board to reconsider rent increases of this type. Observers expect the matter to come before the Oakland city council this summer.

Welcome to 138 Monte Cresta, where the conflict between angry tenants, frustrated landlords, and confused regulators captures many of the passions of Oakland's raging gentrification debate.

THE DREADFUL PROPOSITION 98, Part I -- Slashing Renter Protections Statewide

2008-04-30T12:55:00.000-07:00

If Proposition 98 passes, rent control and all of the most essential tenant protections in cities across California will be no more! A landlord will no longer have to have a “just cause” or “good cause” to evict a tenant. Landlords will be able to serve any tenant with a 30 Day Notice and unless the Notice is served for a retaliatory or discriminatory purpose, the tenants will likely have no viable defense! Prop 98 is not even entitled as a measure to end Rent Control and Just Cause. It is billed as an “Eminent Domain” Initiative. This proposition is brought to you by the same people, the Howard Jarvis Taxpayers Association, who were responsible for one of the worst propositions the State of California has ever seen, Prop 13, which decimated cities and counties throughout the state and led to California having the most atrocious public education system of any major state in the nation.

For the legal analysis of Prop 98's impact on the rental housing market, the Western Center on Law and Poverty in Sacramento has written an excellent report. The report was made available by the S.F. Tenants Union and can be downloaded (.pdf) at http://www.sftu.org/071220%20Western%20Center%20Memo.pdf. The language of Prop 98 will re-define parts of tenant laws we have taken for granted as an unconstitutional "taking" of private property. It is not only rent control and just cause provisions which will be outlawed, but condo conversion limits, 30 and 60 day notice requirements for rent increases & evictions, and limits on landlords' ability to keep security deposits. Passage of Prop 98 will mean landlords will evict tenants who currently live in rent control jurisdictions solely to increase their profits and get more rent for their rental units. So only people with a lot of money will be able to live in wide areas of San Francisco and other California cities. Senior citizens, students, lower income working class people, artists, many people of color and other diverse populations will be forced to leave. There will be a mass exodus of tenants from Los Angeles and the Bay Area -- most likely in the hundreds of thousands -- if this proposition passes. We don’t need cities like San Francisco to mostly be an enclave for the wealthy.

Prop 98 was put on the ballot for the June 3rd Election because of historically low turnout in mid-year elections. We are confident that if tenants turn out in mass throughout California that Prop 98 will lose. But people need to vote. You need to tell everyone you know to register (last day is May 19th) and to vote. Don’t take your tenant rights for granted. If you are a landlord or an owner of real property who is not a tenant, please consider the detrimental impact this initiative will have on the demographics of places like Oakland, Los Angeles, San Francisco and Berkeley.

All the major environmental groups have come out against Prop 98 because of the serious detrimental impacts it would have for California’s air, land, water, flora and fauna. Most notably, prohibitions on building in environmentally sensitive areas will be lifted and laws protecting wetlands or habitat preservation will be ended. Please read the next blog entry here to get an overview on some of the environmental consequences of Prop 98.

THE DREADFUL PROPOSITION 98, PART II -- Gutting Environmental and Land Use Law for Private Profit

2008-04-30T12:17:00.001-07:00

If passed, Proposition 98 would change our California Constitution to make environmental and land-use regulations – even those enacted for the health, safety and welfare of the public or to preserve our fragile environment – invalid or too expensive for the State to implement and enforce. The law would add a “regulatory takings” clause to the Constitution, which (in addition to wiping out tenant protections as Ken outlined in Part I) would require the government to pay owners for any arguable decrease in their profits caused by environmental or land-use regulation.

Even if the regulated activity is harmful to the health of the citizens, the community and the environment, this change in our Constitution would allow owners to claim their absolute right to engage in such activity, and to demand that taxpayers compensate them for their total lost profits which are "taken" from them when by regulations which limit, control or prevent their ability to engage in the activity. While the regulations attempt to limit how much certain moneyed interests can exploit and damage our shared land and resources, these same interests would be able to cry about losses due to the regulations, and force the government to pay them to keep from polluting! The law would be so stacked that nearly every regulation for health, safety and the environment would become too costly for Government to enforce, and the right to maximum profit would rise above and squash the Californians’ rights to sensible planning, clean air, environmental preservation and more. The owner could go so far as to sue to invalidate the very regulations which protect our resources, our land, our air and our water.

According to a legal analysis of Prop 98 by the law firm of SHUTE, MIHALY & WEINBERGER LLP (prepared for and made available by the California League of Conservation Voters Education Fund), regulations which could be invalidated by greedy property owners and business, or which could become a legal means for such profiteers to extort endless sums from California taxpayers include the following:

– Regulation of greenhouse gas emissions under AB 32 and other laws to limit global climate change and protect communities from the dangerous effects of climate change;
– Regulations that protect coastal areas, forestland, farmland, and ranchland, as well as cultural and historic sites;
– “Smart growth” regulations designed to promote compact, walkable, and transit oriented communities that combine residential and commercial land uses; and
– Ordinary zoning regulations, such as restrictions on the development of polluting industry, adult businesses, and “big box” megastores.

(SEE http://www.ecovote.org/no98yes99/smw-letter-re-jarvis.pdf)

Proposition 98 would also negatively effect our ability to protect rare species and their habitats, to protect wetland areas, to protect water quality, air quality, and to protect and limit our exposure to hazardous substances.

Because such regulations impose “costs” on big polluters and make green companies and industries more competitive with dirty and exploitative corporations, Prop 98 would have all of us subsidize the polluters for their increased costs and decreasing business, or would allow them to invalidate the regulations so they could exploit, pollute and damage the environment without restriction. No matter how small or how large the alleged “costs” of the regulation, regulated owners and businesses could extort money from the State indefinitely, and would have no incentive to seek more productive and less damaging ways to make money. Worse, the ambiguities intentionally placed in this measure will lead to protracted legal battles over nearly every proposed environmental statute, rule or regulation, tying up time government resources in the courts and further preventing the implementation and enforcement of important controls and protections.

This initiative goes even farther than the defeated Proposition 90 of 2006 in allowing corporations, polluting industries and large landowners to undo and prevent environmental regulations in California. It was a bad idea then, and the voters rightly rejected it. Prop 98 is an even worse idea now. We must not let it become law and to unravel our important tenant, environmental and land use protections.