Today's Law As Amended


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AB-828 Temporary moratorium on foreclosures and unlawful detainer actions: coronavirus (COVID-19).(2019-2020)



As Amends the Law Today


SECTION 1.
 The Legislature finds and declares as follows:
(a) In late December 2019, several cases of unusual pneumonia began to emerge in the Hubel province of China. On January 7, 2020, a novel coronavirus now known as COVID-19 was identified as the likely source of the illness.
(b) Infections have rapidly spread to other countries throughout the world, including the United States.
(c) On January 30, 2020, the World Health Organization (WHO) declared COVID-19 a Public Health Emergency of International Concern, and on January 31, 2020, the United States Secretary of Health and Human Services declared a Public Health Emergency.
(d) On March 4, 2020, California Governor Gavin Newsom declared a State of Emergency to make additional resources available, formalize emergency actions already underway across multiple state agencies and departments, and help the state prepare for a broader spread of COVID-19. The proclamation comes as the number of positive COVID-19 cases and related deaths in California rises.
(e) Public health officials have indicated that people displaying symptoms that could be consistent with coronavirus as well as people in close contact with people displaying symptoms should self-quarantine by remaining in their homes.
(f) Public health officials have emphasized the critical importance of proper sanitation and good hygiene to slow and prevent the spread of the coronavirus.
(g) Most children who are unable to attend school because of closures will have to remain at home.
(h) Individuals and families who become homeless will not be able to self-quarantine at home, will not have access to proper sanitation and the facilities for maintaining good hygiene, and will not be able to care for their children at home.
(i) Both large and smaller events across California and the United States have been canceled or postponed in response to official government orders and public health recommendations at all levels of government to cancel large gatherings amid concerns over spread of the virus. These cancellations and postponements cause loss in revenue for the event, as well as surrounding local businesses that rely on such events to bring in patrons to their businesses.
(j) Due to the cancellation of local conferences and other large-attendance events, there has been a significant loss of business opportunities. Also, there is a projected loss of indirect spending – the ripple effect of incremental spending within the community that would have occurred from the direct spending in local businesses.
(k) The effects of COVID-19 on the global economy and supply chains are impacting many companies across the United States. Several large, California-based companies have indicated that quarterly earnings will be negatively impacted due to overseas factories operating at two-thirds their capacity, thus leading to missing their growth targets, potentially leading to personnel and other expense cuts. Some companies are having their employees work remotely or from home in order to prevent exposure in the workplace. With more businesses moving towards working from home, less of the workforce will be patronizing restaurants and other retail establishments that employ hourly workers, which is expected to lead to hourly cutbacks and potentially employee terminations.
(l) Many California public school districts have temporarily closed. These school closures will cause children to have to remain at home, leading to many parents adjusting their work schedules to take time off work, whether paid or unpaid. Other parents may be forced to absorb additional costs to pay for child care coverage. Hourly wage earners are unlikely to be paid for time off. The inability to work due to school closures will economically strain those families who cannot afford to take off time from work to stay at home.
(m) The economic hardships brought on by the COVID-19 pandemic mean that many California individuals and households are likely to have difficulty remaining current on their rental or mortgage housing payments through no fault of their own.
(n) These economic hardships have also adversely impacted rental housing providers who must continue to have income to pay for the operation and maintenance of their rental properties, pay their vendors, property taxes, utilities and other operational costs. Maintaining a housing provider’s ability to pay its expenses will help alleviate potential future homelessness.
(o) Without emergency action to prevent it, this likely inability to stay current on rental and mortgage housing payments is likely to lead to a significant increase in homelessness, exacerbating what is already considered a crisis.
(p) On March 18, 2020, the Federal Housing Finance Agency directed the federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac) to impose a 60-day moratorium on (1) foreclosures on single-family home mortgages that they back and (2) evictions from such home mortgages that have already been foreclosed on. This directive still leaves millions of home mortgages subject to potential foreclosure because they are not backed by Fannie Mae or Freddie Mac.
(q) The Legislature recognizes that many renters and rental housing providers have worked together to alleviate the economic consequences occasioned by the COVID-19 virus in order to meet their respective economic needs through mutually agreed-upon repayment agreements. These repayment agreements help alleviate potential future unlawful detainer and other civil lawsuits and potential homelessness.
(r) The Legislature hereby finds and declares that there is a current and immediate threat to the public health, safety, and welfare and a need for immediate preservation of the public peace, health, or safety that warrants this urgency legislation, which finding is based upon the facts stated in the recitals above.

SEC. 2.

 Section 2944.11 is added to the Civil Code, to read:

2944.11.
 (a) Notwithstanding the provisions authorizing nonjudicial foreclosure in this article, the provisions authorizing judicial foreclosure in Chapter 1 (commencing with Section 725a) of Title 10 of the Code of Civil Procedure, or any other general or special law authorizing nonjudicial or judicial foreclosure, no person shall take any action to foreclose on residential real property during the period specified in subdivision (c), including, but not limited to, the following actions:
(1) Causing or conducting the sale of real property pursuant to a power of sale.
(2) Submitting for recordation a notice of default pursuant to Section 2924.
(3) Submitting for recordation, posting, or publication of a notice of sale pursuant to Section 2924f.
(4) Submitting for recordation a trustee’s deed upon sale pursuant to Section 2924h.
(5) Initiating or prosecuting an action to foreclose, including, but not limited to, actions pursuant to Section 725a of the Code of Civil Procedure.
(6) Enforcing a judgment by sale of real property pursuant to Section 680.010.
(b) For purposes of this section, “person” includes, but is not limited to, the following:
(1) A beneficiary or trustee named in a deed of trust or mortgagee named in a mortgage with power of sale upon real property or any interest therein to secure a debt or other obligation.
(2) An association, as defined in Section 4080.
(3) A judgment creditor, as defined in Section 680.240 of the Code of Civil Procedure.
(4) Any successor in interest or agent of a party specified in paragraphs (1) to (3), inclusive.
(c) This section shall be operative only while there is a state or locally declared state of emergency related to the COVID-19 virus in the jurisdiction in which the residential real property is located and for 90 days thereafter, and shall become inoperative 91 days after the state or locally declared state of emergency ends.
(d) Any action taken in violation of this section is void.
(e) This section is repealed on January 1, 2022.

SEC. 3.

 Section 730.7 is added to the Code of Civil Procedure, to read:

730.7.
 (a) Notwithstanding any other law, any action for foreclosure on a mortgage or deed of trust of residential real property brought under this chapter is stayed and the court may take no action and issue no decisions or judgments unless the court finds that the action is required to further the public health and safety.
(b) The period for electing or exercising any rights under this chapter, including exercising any right of redemption from a foreclosure sale or petitioning the court in relation to such a right, is extended until 90 days after the state or local declared state emergency related to the COVID-19 virus in the jurisdiction where the residential real property is located ends.
(c) This section shall be operative only while there is a state or locally declared state of emergency related to the COVID-19 virus in the jurisdiction in which the residential real property is located and for 90 days thereafter, and shall become inoperative 91 days after the state or locally declared state of emergency ends.
(d) This section is repealed on January 1, 2022.

SEC. 4.

 Section 1161.05 is added to the Code of Civil Procedure, to read:

1161.05.
 (a) Any party filing an unlawful detainer complaint shall state on the first page of the complaint whether the property at issue in the complaint is residential real property or commercial property and whether the action is needed to address issues of damage to the property, nuisance, or health and safety.
(b) Notwithstanding any other law, no party shall submit for filing a residential unlawful detainer complaint except for those needed to address issues of damage to the property, nuisance, or health and safety.
(c) A court may not issue a summons on a complaint for a residential unlawful detainer unless the court finds, in its discretion and on the record, that the action is necessary to address issues of damage to the property, nuisance, or health and safety.
(d) A court may not enter a default or a default judgment for restitution in an unlawful detainer action for failure of defendant to appear unless the court finds both of the following:
(1) The action is necessary to protect public health and safety.
(2) The defendant has not appeared in the action within the time provided by law.
(e) If a defendant has appeared in the action, the court may not set a trial date earlier than 91 days after the state or locally declared state of emergency ends unless the court finds that an earlier trial date is necessary to address issues of damage to the property, nuisance, or health and safety. Any trial set in an unlawful detainer proceeding on or after March 26, 2020, shall be continued until 91 days after the state or locally declared state of emergency ends unless the court finds that the action is needed to address issues of damage to the property, nuisance, or health and safety.
(f) Violation of this section by a landlord is an affirmative defense to any unlawful detainer action or other proceeding to recover possession.
(g) This section shall be operative only while there is a state or locally declared state of emergency related to the COVID-19 virus in the jurisdiction in which the property is located and for 90 days thereafter, and shall become inoperative 91 days after the state or locally declared state of emergency ends.
(h) This section is repealed on January 1, 2022.

SEC. 5.

 Section 1174.10 is added to the Code of Civil Procedure, to read:

1174.10.
 (a) Any tenant unable to pay rent due to circumstances related to the COVID-19 pandemic between March 4, 2020, and 90 days after the state or local declaration of emergency related to the COVID-19 in the jurisdiction in which the property is located has ended should notify their landlord before the missed payment that they are unable pay rent. Tenants unable to pay rent during this period due to circumstance related to the COVID-19 pandemic shall, at any time prior to 90 days after the state or local declaration of emergency in the jurisdiction where the property is located has ended, provide the landlord with one or more of the following to qualify for the rent deferment specified subdivision (b):
(1) Letter, text message, or email from employer or other source of income citing COVID-19 as a reason for reduced work hours, termination, or other substantial reduction in pay.
(2) Employer paycheck stubs showing a reduction in pay following the COVID-19 outbreak.
(3) Bank statements showing a reduction in income following the COVID-19 outbreak.
(4) Documentation showing payment of substantial out-of-pocket medical expenses caused by COVID-19.
(5) Documentation showing the closure of a school or childcare facility where a child in the tenant’s care would otherwise be present during the tenant’s working hours.
(6) A sworn statement by the tenant attesting to the existence of a substantial increase in household expenses or decrease in household income, and attesting to their inability to gather the documentation described in paragraphs (1) to (5), inclusive.
(b) Tenants who provided documentation to their landlord under subdivision (a) shall have up to 12 months from 90 days after the state or local declaration of emergency where the property is located has ended to pay their landlord rent not paid between March 4, 2020 and 90 days after the state or local declaration of emergency where the property is located has ended.
(c) A landlord and tenant may mutually agree to a repayment plan. Any repayment plan agreed to and signed by both parties shall include a copy of this section and Section 1161.05.
(d) Nothing in this section relieves a tenant of liability for unpaid rent that became due between March 4, 2020, and 90 days after the state or locally declared state of emergency where the property is located has ended.
(e) Notwithstanding any lease provision to the contrary, late fees, fines, or interest shall not be imposed for rent that became due between March 4, 2020, and 90 days after the state or local declaration of emergency where the property is located has ended.
(f) Violation of this section by a landlord is an affirmative defense to any unlawful detainer action or other proceeding to recover possession.
(g) This section is repealed on January 1, 2022.

SEC. 6.

 Section 27212 is added to the Government Code, to read:

27212.
 (a) Notwithstanding this chapter or any general or special law to the contrary, for the period specified in subdivision (b), no party shall submit to a county recorder for recordation any instrument, paper, or notice that constitutes a notice of default pursuant to Section 2924 of the Civil Code, a notice of sale pursuant to Section 2924f of the Civil Code, or a trustee’s deed upon sale pursuant to Section 2924h of the Civil Code for any residential real property.
(b) (1) Any instrument, paper, or notice of default pursuant to Section 2924 of the Civil Code a notice of sale pursuant to Section 2924f of the Civil Code, or a trustee’s deed upon sale pursuant to Section 2924h of the Civil Code that is submitted for filing shall include an affidavit stating that it does not pertain to residential real property.
(2) Any sale made on the basis of a false or omitted affidavit shall be void.
(c) This section shall be operative only while there is a state or locally declared state of emergency related to the COVID-19 virus in effect in the jurisdiction in which the residential real property is located and for 90 days thereafter, and shall become inoperative 91 days after the state or locally declared state of emergency ends.
(d) This section is repealed on January 1, 2022.

SEC. 7.

 Section 3732 is added to the Revenue and Taxation Code, to read:

3732.
 (a) Notwithstanding the provisions of this chapter or any general or special law to the contrary, a tax collector shall suspend the sale of tax-defaulted residential real property for the period specified in subdivision (b).
(b) This section shall be operative only while there is a state or locally declared state of emergency related to the COVID-19 virus in the jurisdiction in which the residential real property is located and for 90 days thereafter, and shall become inoperative 91 days after the state or locally declared state of emergency ends.
(c) This section is repealed on January 1, 2022.
SEC. 8.
 The provisions of this bill are severable. If any provision of this bill or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.
SEC. 9.
 No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.
SEC. 10.
 This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the California Constitution and shall go into immediate effect. The facts constituting the necessity are:
The COVID-19 virus presents severe economic hardships for the people of California, and in order to preserve the public peace, health, and safety, it is necessary for this act to take effect immediately.