How Eviction Restrictions Differ in California’s Major Metros

The State of California has essentially set an eviction moratorium by preventing state courts from issuing a summons on any unlawful detainer complaints; however, the details of eviction moratoriums have been largely left up to local jurisdictions. As a result, there is some variance in the guidelines from market-to-market. We took a look at California’s three largest metros to see how they differ.

First up, San Francisco: The Northern California market has limited commercial evictions to small and medium businesses, defined as having less than $25 million in revenue in the 2019 tax year. “Any notice of default that San Francisco landlords serve on tenants must provide at least a one-month opportunity to cure,” Jamie Altman Buggy, an attorney at Crosbie Gliner Schiffman Southard & Swanson, tells GlobeSt.com. “During that initial cure period, tenants must either pay the rent or provide documentation showing that tenant is unable to pay rent due to a COVID-19 related financial impact, like a substantial decrease in business income.”

Once the landlord has received documentation of a related financial impact, the tenant and landlord are required to develop a payment plan for the deferred rent. “If they cannot agree to a payment plan, then the tenant may continue to extend the cure period for successive month-long period by providing additional documentation at the end of each month of their continuing inability to pay due to COVID-19 related financial impacts,” adds Buggy. “Tenants can keep obtaining monthly extensions of the cure period for up to a total of six months from the date rent was originally due, during which time landlords cannot evict for non-payment of rent.” After six months of non-payment, landlords can proceed with an eviction.

Next-up, Los Angeles: In the Southern California hub, commercial eviction moratoriums apply to all tenants, with the exception of multi-national companies, publicly traded companies and any company with more than 500 employees. “Landlord are prohibited from evicting commercial tenants based on tenants’ inability to pay rent due to circumstances related to COVID-19,” says Buggy. “Tenants will have up to three months after the Los Angeles mayor declares the end of the local emergency to pay past due rent.  This moratorium differs from others because tenants are not required to provide landlords with documentation proving that their inability to pay is related to COVID-19. While landlords may not charge interest or late fees on unpaid rent, they are not restricted in their ability to serve notices.”

The Los Angeles moratorium has also been extended to unincorporated areas in the county. “The Los Angeles Board of Supervisors also promulgated an executive order that provides for an eviction moratorium applicable to the unincorporated areas of Los Angeles County until May 31, 2020,” says Buggy. “The County moratorium provides tenants up to six months after termination of the Executive Order to repay unpaid rent during which time landlords cannot evict, and does not limit landlords’ ability to charge late fees or interest.”

Finally, San Diego: The city has placed an eviction moratorium on all tenants who have failed to pay rent starting March 12, 2020, as long as the tenant has given notice of non-payment to the landlord before the rent was due. “Within a week of providing such notice to the landlord, the tenant must provide evidence that the tenant’s failure to pay rent is due to the financial impacts of COVID-19,” says Buggy. “If the tenant does not provide evidence, the eviction moratorium does not apply.  If the tenant shows that its failure to pay rent is due to COVID-19, the landlord may not charge late fees, serve an eviction notice, or evict tenant.  Tenants will have until September 25, 2020 to repay rent, unless before that time California Governor Gavin Newsom withdraws his executive order that provides local jurisdictions authority to enact eviction moratoriums, in which case rent will be due upon such withdrawal.” If tenants, instead choose to leave the premises while under moratorium, all rent will be due at the time the tenant moves out. “The ordinance will remain in effect until May 31, 2020, but landlords cannot sue for eviction until the rent-repayment period is over,” adds Buggy.

While landlords do not have unlawful detainer actions at their disposal, Buggy says that there are other ways that landlords can attempt to recover lost rent. “Landlords should note that none of these ordinances prohibit landlords from recovering rent through non-eviction means,” she explains. “The spirit of these eviction moratoriums is to prevent tenants from being evicted during the pandemic—not to prevent landlords from recovering rent. Landlords may choose to apply security deposits and pursue guarantees and letters of credit, if available, under a lease.  However, landlords should be aware that certain local ordinances limit a landlord’s ability to require the tenant to replenish the security deposit or letter of credit if tenant is unable to do so due to financial impacts of COVID-19.”