Landlord Has Right to Up Deposit When There's In-home Child Care

Landlord Has Right to Up Deposit When There's In-home Child Care

16-Nov-1997 Sunday
(Page H-10 )

Robert Griswold | Steven R. Kellman | Ted Smith
This column on issues confronting renters and landlords is written by Certified Property Manager Robert Griswold, host of KSDO Radio's "Real Estate Today!" (Saturdays, 2-3 p.m., AM 1130) and by attorneys Steven R. Kellman, director of the Tenants' Legal Center, and Ted Smith, principal in a law firm representing landlords.

Q: I am the owner of a single-family rental home. The tenant has a month-to-month rental agreement. I recently received a "Family Child Care Home Property Owner/Landlord Notification" form from the Community Care Licensing Division of the state Department of Social Services.

The notification states that the tenant at my property will be operating a licensed family child-care home and that I am "prohibited by law from imposing any direct or indirect restrictions on, or prohibitions against, the tenant's operation of the family child-care home on the rental property."

My insurance company is now canceling my policy because the company does not insure homes in which family child care is provided by tenants. I will incur greater insurance premiums by switching to another company so can't I pass this additional premium onto the tenant?

I also anticipate greater "wear and tear" to the property so can't I increase the security deposit to cover the expected additional damage?

A: Smith: California's Health & Safety Code (Section 1597.40) authorizes tenants to operate day-care homes under certain situations, even though a lease may bar tenants from operating businesses in their rental units.

Effective Jan. 1, 1997, amendments to this law require the day-care provider give written notice of the intention to commence operation within 30 days. The landlord is allowed to increase the resident's security deposit to the maximum allowed by law.

For example, in an unfurnished apartment, twice the monthly rent would be allowed as a security deposit, prior to starting the day-care service. Other regulations apply. The day care provider must be licensed by the state and the Department of Social Services must inspect the premises and make sure the provider meets certain criteria before the business is approved.

Since you are required to comply with the law and accept the day-care home under these conditions, you could take your case to the insurance company and ask that it not increase the premium and not cancel the policy.

The day-care provider is at all times responsible for the children and must ensure that everyone complies with all reasonable rules and regulations of the apartment property relating to health and safety.

Q: I am a renter who did not have a pet when I rented, but later acquired one. We pay $895 monthly and paid the owner a $1,000 deposit on our house. What is the maximum amount an owner can charge for a deposit? How much can they charge us for a pet deposit?

A: Griswold: State law, (Civil Code Section 1950.5 (c), provides that the total of all fees and deposits collected by owners for unfurnished rentals cannot exceed two times the monthly rent or no more than three times for furnished rentals

In the event the tenant has a waterbed, an additional security deposit of up to a half month's rent is allowed.

The California Civil Code goes to great lengths to very broadly describe the term "security deposit." Thus, while some owners use different terms, whether they call the security deposit a pet deposit, cleaning deposit or administrative fee, all cannot exceed these maximum amounts.

Also, note that the owner cannot designate any or all of the security deposit as non-refundable, per California Civil Code section 1950.5 (l).

Prudent landlords do not quote separate security and pet deposits, but merely collect a larger security deposit when allowing pets in their rental units.

If you're a tenant or 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