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SB-529 Tenant associations: eviction for cause: withholding payment of rent.(2019-2020)

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Date Published: 02/21/2019 09:00 PM
SB529:v99#DOCUMENT


CALIFORNIA LEGISLATURE— 2019–2020 REGULAR SESSION

Senate Bill No. 529


Introduced by Senator Durazo

February 21, 2019


An act to add Chapter 2.9 (commencing with Section 1954.700) to Title 5 of Part 4 of Division 3 of the Civil Code, relating to tenancy.


LEGISLATIVE COUNSEL'S DIGEST


SB 529, as introduced, Durazo. Tenant associations: eviction for cause: withholding payment of rent.
Existing law makes it unlawful for a lessor to engage in specified activities for the purpose of influencing a tenant to vacate a dwelling, including using, or threatening to use, force, willful threats, or menacing conduct that interferes with the tenant’s quiet enjoyment of the premises and that would create an apprehension of harm in a reasonable person. Existing law prohibits a lessor from retaliating against a lessee because the lessee has lawfully organized or participated in a lessees’ association or an organization advocating lessees’ rights or has lawfully and peaceably exercised any rights under the law by increasing rent, decreasing services, causing a lessee to quit involuntarily, bringing an action to recover possession, or from threatening to do any of those acts. A lessor who violates this latter provision is liable to the lessee for actual damages and, under certain circumstances, punitive damages.
This bill would declare that tenants have the right to form, join, and participate in the activities of a tenant association, subject to any restrictions as may be imposed by law, or to refuse to join or participate in the activities of a tenant association. The bill would define “tenant association” for these purposes and require a tenant association under these provisions to adopt bylaws or implement an operating agreement for purposes of its internal governance. The bill would prohibit a landlord from terminating or refusing to renew a residential tenancy in a rental unit, as defined, occupied by a member of a tenant association subject to these provisions, except for cause. The bill would require any landlord who attempts to terminate a tenancy pursuant to these provisions to provide the tenant a written notice to quit or terminate that recites the grounds on which the landlord is proceeding.
The bill would authorize members of a tenant association, by a majority vote, to withhold rent payments for up to 30 days in response to grievances or complaints with the landlord. The bill would require a tenant exercising the right to withhold payment of rent to purchase a money order or cashier’s check to pay the withheld rent, as provided, and provide the landlord with a written notice containing specified information. The bill would require the landlord, within specified time periods, to provide the tenant association with a written response to that notice, meet and confer in good faith with representatives of the tenant association, and provide a written statement of what, if any, changes the landlord will make in response to those grievances or complaints. If the landlord fails to strictly comply with these requirements, the bill would provide that payment of the withheld rent by those tenants is waived. The bill would limit the amount of times a tenant association could initiate proceedings to withhold payment of rent under these provisions per calendar year.
The bill would provide that a landlord who retaliates against a tenant for exercising the tenant’s right to join, form, or participate in the activities of a tenant association, or who otherwise violates any of the above-described provisions of the bill, is liable to the tenant in a civil action for actual damages, injunctive relief, and, in specified circumstances, punitive damages. The bill would also make a landlord’s violation of, or noncompliance with, these provisions an affirmative defense in any action by a landlord to recover possession of a rental unit. In an action for damages, the bill would require the court to award reasonable attorney’s fees to the prevailing party if either party requests attorney’s fees upon the initiation of the action. The bill would specify that these remedies are in addition to any other remedies available by law.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: NO   Local Program: NO  

The people of the State of California do enact as follows:


SECTION 1.

 Chapter 2.9 (commencing with Section 1954.700) is added to Title 5 of Part 4 of Division 3 of the Civil Code, to read:
CHAPTER  2.9. Tenant Associations

1954.700.
 For purposes of this chapter:
(a) “Condominium” has the same meaning as defined in Section 783.
(b) “Landlord” means an owner, lessor, sublessor or any other person or entity entitled to offer any residential unit for rent or entitled to receive rent for the use and occupancy of any rental unit.
(c) (1) “Rental unit” means a room or a group of two or more rooms designed, intended, or used for human habitation include and includes apartments, condominiums, stock cooperatives, single-dwelling units, and hotel units.
(2) Notwithstanding paragraph (1), “rental unit” does not include any of the following:
(A) Housing accommodations in any hospital, convent, monastery, extended care facility, asylum, nonprofit home for the aged, or a fraternity or sorority house.
(B) Mobilehomes subject to the Mobilehome Residency Law (Chapter 2.5 (commencing with Section 798) of Title 2 of Part 2 of Division 2), recreational vehicles subject to the Recreational Vehicle Park Occupancy Law (Chapter 2.6 (commencing with Section 799.20) of Title 2 of Part 2 of Division 2), or floating homes subject to the Floating Home Residency Law (Chapter 2.7 (commencing with Section 800) of Title 2 of Part 2 of Division 2).
(C) Transient occupancies described in subdivision (b) of Section 1940.
(d) “Single-dwelling unit” means a single detached structure containing one dwelling unit for human habitation and accessory buildings appurtenant thereto located on a lot or parcel and all housing services provided in connection with the use or occupancy thereof.
(e) “Stock cooperative” has the same meaning as defined in Section 11003.2 of the Business and Professions Code.
(f) “Tenancy” means the right or entitlement of a tenant to use or occupy a rental unit.
(g) “Tenant” includes a tenant, subtenant, lessee, sublessee, or other person legally in possession or occupying a rental unit.
(h) “Tenant association” means a group of tenants from three or more rental units that are owned or operated by the same landlord who form or maintain an organization, whether incorporated or unincorporated, to improve housing conditions, amenities, community life, or the contractual position of the member tenants.

1954.701.
 (a) (1) Tenants shall have the right to form, join, and participate in the activities of a tenant association, subject to any restrictions as may be imposed by law, or to refuse to join or participate in the activities of a tenant association.
(2) Each tenant association subject to this chapter shall adopt bylaws or implement an operating agreement for purposes of its internal governance.
(b) It is the intent of Legislature that this chapter add protections for tenants that seek to engage in organizing activities through a tenant association. Therefore, this chapter shall not preempt, limit, supplant, or otherwise reduce the rights of tenants under other state or local law, except to the extent that the other law is inconsistent with this chapter.

1954.702.
 (a) Notwithstanding any other law, the tenancy of a member of a tenant association subject to this chapter shall not be terminated, and its renewal shall not be refused, except for cause.
(b) (1) Subject to paragraph (2) of subdivision (b) of Section 1954.703, any landlord who attempts to terminate the tenancy of a member of a tenant association for cause, as provided in subdivision (a), shall provide the tenant a written notice to quit or terminate that recites the grounds under which the landlord is proceeding. The landlord shall provide the notice prior to or at the same time as, or as part of, the written notice of termination set forth in Section 1946 or 1946.1, as applicable, or the three-day notice described in Sections 1161 and 1161a of the Code of Civil Procedure, is served on the tenant.
(2) If a tenant who is a member of a tenant association receives a written notice to quit or terminate from a landlord that does not recite the grounds under which the landlord is proceeding, the tenant may notify the landlord that the tenant is a member of a tenant association subject to this chapter and request that the notice be withdrawn. Within seven days of receiving a request to withdraw a notice to quit or terminate pursuant to this paragraph, the landlord shall rescind the notice in writing. Nothing in this section shall prohibit a landlord from subsequently providing the tenant a written notice to quit or terminate that satisfies the requirements of paragraph (1).
(c) This section shall not be construed to prohibit the enactment, amendment, or enforcement of an ordinance by a city, county, or city and county establishing just cause eviction controls that are consistent with this section.

1954.703.
 (a) (1) Subject to subdivision (e), members of a tenant association may, by a majority vote, initiate proceedings to withhold payment of rent for up to 30 days in response to grievances or complaints with the landlord pursuant to this section.
(2) Upon initiating proceedings pursuant to this section, a member of the tenant association exercising the right to withhold payment rent shall purchase a money order or cashier’s check for payment of rent, in an amount sufficient to pay the amount of rent payment withheld pursuant to this section, and shall hold that money order or cashier’s check until the resolution of the grievances or complaints specified in the written notice provided pursuant to subdivision (b) in accordance with this section or until the 30-day period specified in paragraph (1) has lapsed, whichever occurs earlier.
(b) (1) A member of the tenant association exercising the right to withhold payment of rent pursuant to this section shall provide a written notice to the landlord that contains all of the following information:
(A) The tenant is a member of a tenant association that represents tenants residing in rental units owned or operated by the landlord.
(B) By a majority vote, members of that tenant association have voted to initiate proceedings to withhold payment of rent pursuant to this section due to one or more grievances or complaints, which the notice shall set forth in detail.
(C) The tenant has purchased a money order or cashier’s check for payment of rent that will be held until the resolution of the grievances or complaints listed in the notice in accordance with this section or until the 30-day period specified in paragraph (1) of subdivision (a) has lapsed.
(2) The landlord shall not serve a written notice to quit or terminate pursuant to subdivision (b) of Section 1954.702 or take any action to evict members of the tenant association withholding payment of rent pursuant to this section for 30 days following receipt of the written notice pursuant to this subdivision.
(c) (1) Within seven days of receiving written notice pursuant to subdivision (b), the landlord shall provide the tenant association with a written response to that notice explaining the landlord’s action or inaction in regard to the grievances or complaints specified in the notice.
(2) Within 14 days of receiving of the written notice pursuant to subdivision (b), the landlord shall meet and confer in good faith regarding the grievances or complaints specified in the notice with representatives of the tenant association.
(3) After meeting and conferring in good faith pursuant to paragraph (2), but no later than 21 days after receiving the written notice pursuant to subdivision (b), the landlord shall provide the tenant association with a written statement regarding what, if any, changes the landlord will make in response to the grievances or complaints specified in the written notice.
(d) (1) Except as provided in paragraph (2), no later than seven days following the end of the 30-day period specified in paragraph (1) of subdivision (a), a tenant who has exercised the right to withhold payment of rent pursuant to this section shall provide the money order or cashier’s check held pursuant to paragaph (2) of subdivision (a) in payment of the rent previously withheld pursuant to this section, unless the tenant association and the landlord agreed to an alternative arrangement. Rent paid within this seven-day period, or pursuant to an alternative arrangement agreed to by the tenant association and the landlord, shall not be considered a late payment of rent and shall not be subject to any penalty or fee for the late payment of rent.
(2) Notwithstanding paragraph (1), if the landlord failed to strictly comply with any of the requirements specified in subdivision (c), payment of the rent withheld by a member of a tenant association pursuant to this section shall be waived.
(e) A tenant association shall not initiate proceedings or withhold rent pursuant to this section more than ___ times per calendar year.
(f) This section does not preempt any ordinance, resolution, or other rule or regulation of a city or county establishing a binding dispute resolution process for landlords and tenants that would impact the obligation to pay the withheld rent or otherwise provide greater protections for tenants’ rights than those provided under this section.

1954.704.
 (a) Notwithstanding Section 1942.5, a landlord who retaliates against a tenant for exercising the tenant’s right to join, form, or participate in the activities of a tenant association, or who otherwise violates any provision of this chapter, shall be liable to the tenant in a civil action for all of the following:
(1) The actual damages sustained by the tenant.
(2) Injunctive relief.
(3) Punitive damages in an amount of not less than five hundred dollars ($500) nor more than ten thousand dollars ($10,000) for each retaliatory act where the landlord has been guilty of fraud, oppression, or malice with respect to that act.
(b) In any action brought for damages for a violation of this chapter, the court shall award reasonable attorney’s fees to the prevailing party if either party requests attorney’s fees upon the initiation of the action.
(c) The remedies provided by this section shall be in addition to any other remedies provided by statutory or decisional law.
(d) In any action by a landlord to recover possession of a rental unit, the tenant may raise as an affirmative defense any violation of, or noncompliance with, this chapter.