Owner Can `Sell' Lease Terms With the Rental

02-Feb-1997 Sunday
(Page H-6 )

This column on issues confronting renters and landlords is written by Certified Property Manager Robert Griswold, host of KSDO Radio's "Real Estate Management Today!" (Saturdays, 2-4 p.m.) and by attorneys Steven R. Kellman, director of the Tenants' Legal Center, and Ted Smith, principal in a law firm representing landlords.

Q: We have a 12-month lease on a home that has six months remaining on it. Our landlord sold the house last month and we were advised in writing that our deposit was transferred to the new owner. Is our original lease still valid? Can we or the new owner cancel the lease?

A: Griswold: Your lease is still valid and you and the new owner must honor the terms and conditions unless you mutually agree to a change or a new lease. The transfer of your security deposit was documented in writing, which is proper, and the new owner will be responsible for the required accounting upon your vacating the premises.

Q: My landlord says she must refinance the condo I'm renting. She says she will receive better terms if she gets an "owner occupied" loan. To assist her, she has asked me to transfer the utility bills back into her name so that she can use them as proof to the lender that she is living at the condo. What liability, if any, will I incur if I go along with this proposition?

A: Smith: You don't want to be a part of this scheme. But try to remain neutral. That way, it is hoped, you can stay on good terms with your landlord even though you're not willing to lie for her.

Kellman: The act of lying to a bank to obtain a lower interest rate is illegal. What the landlord is attempting to do is commit a fraud upon her lender (the bank). This action may result in civil and even criminal penalties. If the tenant knowingly takes part in this action to "assist" the landlord, the tenant may be equally guilty in the eyes of the law. The biggest favor you can do for the landlord is to advise her to tell the bank the truth and avoid the risk of some potentially serious penalties. Even if the landlord retaliates against you for refusing to go along with this scheme, the law is on your side. If, for example, she tries to evict you, it would be illegal based on unlawful retaliation because you refused to assist in breaking the law.

Q: I have lived in an apartment for several months with no problems. Recently, the manager passed out "Tenant Rules" that delineate 22 items, many of which are very harsh. I am totally shocked by these new rules as many are very different from the rental agreement I originally signed. The owners demand that I sign them, including putting my initials on each of the 22 items. Can they do this?

A: Griswold: Yes, the owner or manager has the right to change the house rules or guidelines upon proper legal notice. A properly delivered legal notice changing the terms of your agreement would take effect at either the expiration of your current lease, should you continue to live there, or after 30 days if you have a month-to-month rental agreement. Naturally, you should carefully review each "new rule" and make sure that it does not violate any law or discriminate against a protected class. For example, a rule indicating that "Children may not ride bicycles on the property" would be improper. However, a rule stating "No one may ride bicycles on the property" would be enforceable.

Smith: You are going to have to make a decision. Either play by the rules of your tenancy or vacate the premises. The landlord has the right to modify the terms of a lease or rental agreement, if proper legal notice is given. While you may think the 22 new rules are harsh, they are legal. Furthermore, they become a binding part of your agreement if proper notice is given. Assuming the new rules neither discriminate nor violate public policy, you will be obligated to comply with them as long as you continue to live there.

Q: I have lived in an apartment for several years and I have complained about my carpet for over a year. The backing is separating from the fiber or knap of the carpet. The manager says they will only replace the carpet if I remove all of my furniture myself. I cannot afford this expense, plus I am concerned that they will buy such cheap carpet that I will be asked to move my furniture again. If they would buy good-quality carpet that would last 10 years, I would be willing to pay for the furniture removal. Do you have any advice?

A: Griswold: Clearly, the carpet poses a health hazard and should be replaced by the landlord at their expense, including the moving of your furniture. Most carpet suppliers will charge a nominal sum ($100-150) to the landlord to recarpet a furnished unit. It sounds like you have been a good tenant for several years and have plans to stay, therefore a wise landlord should be happy to pay the slight additional cost to move your furniture. I would present this argument to them. If the landlord does not cooperate and you are faced with paying to move your furniture, it may be wise to move to another property at this time. I am sure there are many owners that would appreciate your business.

Kellman: The landlord has the obligation to replace the carpet when it becomes so old and worn as to be a safety and health hazard. Under your situation, it appears that if the tenant wants new carpet, he or she must move their stuff out. But if the tenant can't afford to do that, the landlord does not buy the carpet. Thus, the landlord has set up a situation where he/she does not have to buy the carpet. This is certainly unfair to the tenant who has done nothing wrong and only asks to have the proper maintenance done. It is pretty well accepted that if the unit floods or if it needs to be tented for insects, the landlord pays the occupants for the day or two needed in a motel during the inconvenience. I think the landlord should pay for this inconvenience also. Unfortunately, the only way to force the landlord to do this is in the courts. A compromise would be preferable to going to court.

Q: We recently vacated a home that we had rented for a year. When we moved in, we paid a security deposit of $1,150. Since we had a pet, the landlord also insisted on a nonrefundable pet deposit of $200. Recently, it came to my attention that California Civil Code 1950.5 states that landlords cannot designate any deposit as nonrefundable. Of course, if our pet did some damage, then the landlord could legally deduct the appropriate amount from our pet deposit. If faced with this situation in the future, how should we handle a landlord's demand for a nonrefundable pet deposit?

A: Kellman: It is correct to assume that a "nonrefundable" deposit is actually refundable. If the landlord insists on receiving this type of deposit and the total of all of the deposit does not exceed the legal limits (2 times the monthly rent for unfurnished, 3 times rent for furnished) you may simply pay it. Even if the lease says "nonrefundable," it is actually refundable. When the tenancy is terminated, one may simply give a copy of the code to the landlord. If that does not make the point, I'm sure a judge will be happy to make that point very clear should the matter proceed to court.

Smith: With certain exceptions, California landlords are under no legal obligation to accept pets. And the $200 deposit could very well be used for pet-related cleanup. Assuming that the carpet has to be sprayed for fleas, treated for stains or deep-vacuumed to remove pet hair, these expenses
could well exceed the amount of your deposit. Despite this, I would agree with Steve that the pet deposit must be refundable, even though labeled nonrefundable.

If you're a tenant or a landlord, the authors stand ready to answer your questions in this column, although letters cannot be answered individually. Write them at: Rental Roundtable, Homes Section, San Diego Union-Tribune, P.O. Box 191, San Diego, CA 92112. Or you may e-mail them at rgriswold@retodayradio.com

Back to 1997 Rental Roundtable Index

Robert Griswold and the Real Estate Today! radio show strongly support the intent and the letter of all federal and state fair housing laws. As a reminder to all owners and managers of real estate, note that all real estate advertised is subject to the Federal Fair Housing Act, which makes it illegal to advertise "any preference, limitation, discrimination because of race, color, national origin or ancestry, religion, sex, physical disability, or familial status, or intention to make any such preference, limitation or discrimination." Additional state and/or local fair housing laws may also apply. Be sure to inform all persons that all dwellings offered or advertised are on an equal opportunity basis.

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Revised and Updated - Wednesday, April 26, 2006

Robert S. Griswold, CRE, CPM, CCIM, PCAM, GRI, ARM
Griswold Corporate Center
Griswold Real Estate Management, Inc.
5703 Oberlin Drive, Suite 300
San Diego, CA 92121-1743
Phone: (858) 597-6100
Fax: (858) 597-6161
Email: rgriswold.ret@retodayradio.com