Articles Posted in California Courts of Appeal

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Lloyd Copenbarger, as Trustee of the Hazel I. Maag Trust (the Maag Trust), sued Morris Cerullo World Evangelism, Inc. (MCWE) for declaratory relief and breach of a settlement agreement made to resolve various disputes, including an unlawful detainer action. MCWE was the lessee of a 50-year ground lease (the Ground Lease) of real property (the Property) in Newport Beach. The Property was improved with an office building and marina (the Improvements). The Ground Lease was set to terminate on December 1, 2018. In 2004, MCWE subleased the Property and sold all of the Improvements to NHOM (the Sublease). Starting in 2009, NHOM experienced cash flow problems due to “a shortage of rents.” In June 2011, MCWE commenced an unlawful detainer action against NHOM based on allegations NHOM failed to maintain and undertake required repairs to the Improvements. Six months later, the Maag Trust intervened in the UD Action as a party defendant under the theory that if NHOM were evicted and the Sublease terminated, then the Maag Trust’s security interest created by the Maag Deed of Trust would be destroyed. In August 2012, MCWE, Plaza del Sol, and the Maag Trust entered into a settlement agreement (the Settlement Agreement). The Maag Trust alleged MCWE breached the settlement agreement by failing to dismiss with prejudice the unlawful detainer action and sought, as damages, attorney fees incurred in that action from the date of the settlement agreement to the date on which MCWE did dismiss the action. Following a bench trial, the trial court found MCWE had breached the settlement agreement by not timely dismissing with prejudice the unlawful detainer action. As damages, the court awarded the Maag Trust attorney fees it claimed to have incurred during the relevant time period. On appeal, MCWE did not challenge the finding that its failure to dismiss the unlawful detainer action constituted a breach of the settlement agreement. Instead, MCWE made a number of arguments challenging the damages awarded. After review, the Court of Appeal reversed the judgment against MCWE because there was a wholesale failure of proof of the amount of damages on the part of the Maag Trust. Therefore, the Court reversed with directions to enter judgment in favor of MCWE on the Maag Trust’s complaint. View "Copenbarger v. Morris Cerullo World Evangelism, Inc." on Justia Law

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Coyne's San Francisco property includes a building with three apartments and a free-standing, three-bedroom cottage. De Leo, age 81, had resided in the cottage since 1989. In 2012, Coyne decided to move into the cottage. Martin asked De Leo to move to the lower unit for a reduced rent. De Leo initially agreed. Martin paid that tenant $10,000 to vacate and painted the lower unit. De Leo’s son expressed concerns that no caregiver would have a place to stay if De Leo moved to the lower unit. Martin explained that he could invoke the Ellis Act to evict the tenants. De Leo refused to vacate. Martin transferred ownership to trusts, executed a tenancy in common agreement, and filed a “Notice of Intent to Withdraw Residential Units from the Rental Market” with the Residential Rent Stabilization and Arbitration Board, listing himself as the occupant of the upper unit, although he did not then reside there. Esclamado, a Coyne employee, was listed as the lower unit occupant, but no rent was listed; lower and upper units the as “owner-occupied.” After extensions, the Board recorded notices that the units would be withdrawn from the rental market (Gov. Code, 7060.2). Ultimately, Coyne obtained a judgment of possession. The court of appeal reversed. The trial court abused its discretion excluding De Leo’s evidence on the key factual issue of whether Martin had a bona fide intent to withdraw the Property from the residential rental market--evidence that Martin sold Esclamado a sham ownership interest. View "Coyne v. De Leo" on Justia Law

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Winslett sued her former landlord after he failed to make repairs to her apartment and filed an unlawful detainer action against her. Landlord responded with an anti-SLAPP (Strategic Lawsuit Against Public Participation, Code of Civil Procedure 425.16) motion to strike the claims for retaliation and retaliatory eviction (Civil Code section 1942.5) and under the Oakland Just Cause For Eviction Ordinance. The court granted the motion, awarding Landlord attorney fees and costs. The court of appeal reversed. Because the section 1942.5 scheme of retaliatory eviction remedies would be rendered significantly inoperative if the litigation privilege were to apply, section 1942.5, subdivisions (d) and (h) create an exception to that privilege. Winslett’s “Just Cause Ordinance” claim was not rooted in the unlawful detainer action, in the notice to quit, or in any other protected free speech or petitioning activity, but rather lies in the broader circumstances surrounding the eviction: the alleged pressure tactics designed to force Winslett to abandon her apartment and cease making complaints about tenantability. Because that claim does not arise out of protected activity, there were no grounds for striking it under the anti-SLAPP statute. View "Winslett v. 1811 27th Avenue, LLC" on Justia Law

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A landlord can not be held liable to a commercial tenant for damage to the tenant's property resulting from an alleged sewer backup when the tenant (who had a month-to-month tenancy in the premises after her lease expired) had stopped paying rent, had been served (but failed to comply) with a three-day notice to pay rent or quit, and had been named in an unlawful detainer action filed before the alleged sewer backup occurred. In this case, the month-to-month tenancy was terminated by the tenant's failure to pay rent coupled with the landlord's filing of the wrongful detainer action. Therefore, as of the filing of the wrongful detainer action, the Court of Appeal held that the tenant was a tenant at sufferance who had no lawful right to possession of the premises. The court held that the landlord was not liable for damage to the tenant's property left on the premises when that damage was not caused by the landlord's intentional act or negligence. The court affirmed the judgment of the trial court. View "Multani v. Knight" on Justia Law

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Reilly and two daughters moved into a Novato apartment in 1998. They received Section 8 housing assistance payments. In 2004 one daughter moved out, but Reilly failed to inform the Marin Housing Authority (MHA) of her departure. Five years later, when Reilly told MHA that this daughter no longer lived with her, MHA informed Reilly that her failure to report the departure earlier was a violation of program rules and that she had to pay damages of $16,011. Reilly and MHA agreed to monthly payments; they revised the plan several times, eventually reducing Reilly’s obligation to $150 per month. Reilly missed multiple payments. Reilly requested that MHA recalculate her rent and exclude her income from the In-Home Supportive Services (IHSS) program, which compensates those who care for aged, blind, or disabled individuals incapable of caring for themselves. Reilly’s daughter suffers from a severe developmental disability. MHA proposed termination of her Section 8 voucher. Reilly argued that MHA improperly included her IHSS payments as income. A hearing officer upheld MHA’s decision to terminate Reilly’s housing voucher. The trial court and court of appeal affirmed. The IHSS money Reilly receives is “income” within the meaning of HUD regulations; MHA should include it in calculating Reilly’s housing assistance payment. View "Reilly v. Marin Housing Authority" on Justia Law

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In 1998 San Francisco outlawed discrimination against tenants who pay a portion of their rent with a Section 8, or similar, housing voucher by amending San Francisco’s existing housing discrimination ordinance to outlaw discrimination based on a person’s “source of income,” a term defined broadly to include government rent subsidies. In 1999, the California Legislature expanded the state’s Fair Employment and Housing Act (FEHA) to prohibit discrimination based on a tenant’s “source of income,” but defined the term narrowly, so that it does not reach government rent subsidies (Gov. Code 12955(a)). FEHA does not prevent a landlord from declining to take Section 8 tenants. The trial court and court of appeal held that the ordinance is not preempted by FEHA. The purpose of FEHA is “to provide effective remedies” for the 14 categories of “discriminatory practice[]” that FEHA itself addresses. FEHA does not reach the discriminatory practice of a landlord refusing to rent to a participant in the Section 8 program. San Francisco’s ordinance prohibiting such conduct has, by definition, a different purpose from FEHA.There is no inherent contradiction between FEHA and the San Francisco ordinance. View "City and County of San Francisco v. Post" on Justia Law

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Before San Francisco Ordinance 286-13 was adopted in 2013, the Planning Code generally prohibited the enlargement, alteration or reconstruction of “nonconforming units,” which are legal residential housing units that exceed the currently-permitted density for the zoning district in which they are located. The 2013 amendment permits the enlargement, alteration or reconstruction of nonconforming residential units in zoning districts where residential use is principally permitted, if the changes do not extend beyond the “building envelope” as it existed on January 1, 2013. A waiting period of five to 10 years applies for changes to units where a tenant has been evicted employing Administrative Code grounds for evicting a non-faulting tenant, including section 37.9(a)(13), which allows an owner to evict tenants to remove residential units from the rental market in accordance with the Ellis Act. The Ellis Act prohibits local governments from “compel[ling] the owner of any residential real property to offer, or to continue to offer accommodations in the property for rent or lease.” Gov. Code 7060(a). The trial court upheld the amendment. The court of appeal reversed, concluding that the ordinance is preempted by the Ellis Act because it requires an owner who exercises Ellis Act rights to wait years before being eligible for a permit to make alterations. View "Small Property Owners of San Francisco Institute v. City and County of San Francisco" on Justia Law

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A commercial landlord who leases space to an operator of a health studio does not owe a duty under Health and Safety Code section 104113 or the common law to acquire and maintain an automated external defibrillator (AED) at the space or ensure that the operator does so. The Court of Appeal affirmed the trial court's grant of summary judgment for defendants in an action alleging negligence per se and negligence based on defendants' failure to maintain an AED on the premises of a boxing club. The court considered the Rowland v. Christian, (1968) 69 Cal.2d 108, factors and held that defendant did not owe a duty to the gym's patrons to provide an AED on the premises nor a duty to require as a condition of the lease that the gym provide an AED on the premises. View "Day v. Lupo Vine Street, LP" on Justia Law

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HomeAway, an online forum that allows owners to list their properties for short-term rentals and connect with individuals who want to rent a house or apartment, rather than stay in a hotel, is not a party to those rental transactions. San Francisco requires owners who rent out property to obtain a registration certificate from the treasurer; short-term renters must pay a transient occupancy tax. A recent report on short-term rentals in San Francisco showed that most owners did not comply with those requirements. San Francisco obtained a court to enforce an administrative subpoena, requiring HomeAway.com to disclose data about San Francisco rental transactions. The court of appeal affirmed the order, rejecting arguments that the subpoena violated the Stored Communications Act, 18 U.S.C. 2701–2712, which regulates the government’s ability to compel disclosure of some electronic data stored on the Internet, and that enforcing the subpoena would violate its customers’ constitutional rights. Even if HomeAway is “covered” by the Act, there is no violation because San Francisco used an authorized procedure. In addition, the subpoena does not require HomeAway to disclose electronic communications but seeks very specific information about hosts who use HomeAway to offer to rent property and about bookings. It does not command HomeAway to produce any customer's electronic communication or login information. View "City and County of San Francisco v. HomeAway.com, Inc." on Justia Law

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HomeAway, an online forum that allows owners to list their properties for short-term rentals and connect with individuals who want to rent a house or apartment, rather than stay in a hotel, is not a party to those rental transactions. San Francisco requires owners who rent out property to obtain a registration certificate from the treasurer; short-term renters must pay a transient occupancy tax. A recent report on short-term rentals in San Francisco showed that most owners did not comply with those requirements. San Francisco obtained a court to enforce an administrative subpoena, requiring HomeAway.com to disclose data about San Francisco rental transactions. The court of appeal affirmed the order, rejecting arguments that the subpoena violated the Stored Communications Act, 18 U.S.C. 2701–2712, which regulates the government’s ability to compel disclosure of some electronic data stored on the Internet, and that enforcing the subpoena would violate its customers’ constitutional rights. Even if HomeAway is “covered” by the Act, there is no violation because San Francisco used an authorized procedure. In addition, the subpoena does not require HomeAway to disclose electronic communications but seeks very specific information about hosts who use HomeAway to offer to rent property and about bookings. It does not command HomeAway to produce any customer's electronic communication or login information. View "City and County of San Francisco v. HomeAway.com, Inc." on Justia Law