Hey there, I'm Krystal Freedom, MBA Realtor®, and I'm here to break down some significant legal changes that impact both renters and property owners in Santa Barbara and across the great state of California. We're diving into two crucial pieces of legislation: the City of Santa Barbara's Mandatory 12-Month Lease Term Law and California's New Just Cause Eviction Law. Let's get started.
1. Santa Barbara's New Minimum 12-Month Term Requirement
Santa Barbara, known for its beautiful landscapes and vibrant community, introduced a new law that mandates landlords to offer a minimum 12-month lease term for specific rental units. This law, codified in Santa Barbara Municipal Code section 26.40.010, kicked in on June 7, 2019. However, let me tell you, it's not the most straightforward law to grasp. Here's the gist of it: unless there are some exceptions, landlords are now obligated to provide written leases with a minimum term of 12 months on an annual basis.
Tenants, on the other hand, have the power to choose whether to accept or decline this 12-month lease offer in writing. If they decide to decline, landlords have a specific process to follow, involving a form rejection. Now, the twist here is that if landlords fail to comply with this law, they might find themselves unable to evict tenants, even if there are lease violations, unpaid rent, or expired month-to-month leases. It gets a bit tricky when it comes to month-to-month leases, as the law doesn't explicitly address them, even though Santa Barbara has quite a few of those.
My take on this? I believe that all landlords should have offered 12-month minimum term leases to tenants with written leases by June 30, 2019, and for month-to-month leases not in writing, no later than September 5, 2019, with annual renewals thereafter. For the nitty-gritty details, you can refer to Santa Barbara Municipal Code Section 26.40.010-26.40.030.
2. California's New "Just Cause Eviction" Laws
Now, let's shift our focus to California's Tenant Protection Act of 2019, which brought about a significant change. It says that residential real property owners can't terminate a tenant's tenancy if the tenant has been lawfully occupying the property for 12 months, except for "just cause" reasons, as stated in the written notice to terminate (see Civ. Code § 1946.2(a)). But hang on, there are exceptions here too. Condominiums, non-corporate-owned single-family residences, and some other properties are exempt from this "just cause" termination law.
For cases of "at fault just cause," like non-payment of rent or lease violations, landlords can terminate the tenancy without having to provide relocation payments to the tenant. However, when it comes to "no-fault just cause" reasons for termination, landlords must make relocation payments to the tenant or offer a rent waiver.
But here's where it gets interesting. How do Santa Barbara's 12-month lease law and California's just cause eviction law intersect? Can a landlord in Santa Barbara evict a tenant when the 12-month minimum term ends? Well, strictly speaking, under Santa Barbara's 12-month minimum lease law, they can, with the potential requirement for mediation. However, California's just cause eviction law uses the term "terminate the tenancy" rather than "evict" or similar terms.
So, what's the distinction here? Termination of a tenancy isn't the same as actually evicting or recovering possession from a tenant. When a fixed-term lease naturally ends, the tenancy automatically terminates without any additional notice from the landlord. So, as per Santa Barbara's new law, if a fixed-term lease with a 12-month term expires on its own terms, the tenancy automatically terminates, and the owner hasn't technically terminated the tenancy, as Civil Code section 1946.2 contemplates.
But did the California Legislature intend to allow tenant evictions without "just cause" when fixed-term leases expire? That's the million-dollar question, and the answer isn't crystal clear. However, the language the Legislature used doesn't seem to expressly prohibit it. Comparing California's just cause eviction statute to San Francisco's equivalent, San Francisco's law seems broader in that it says "A landlord shall not endeavor to recover possession of a rental unit unless" there is just cause. On the other hand, California adopted a more limited language: "shall not terminate the tenancy."
So, it appears that a tenant may be evicted if the tenancy automatically terminates when the fixed term expires, even without "just cause." However, it's not entirely certain if a landlord would be successful in court defending such an eviction due to California's apparent intent to limit such evictions.
Also, as part of California's Tenant Protection Act of 2019, California introduced Civil Code Section 1947.12, which restricts annual rent increases to five percent plus the applicable Consumer Price Index amount. There are exemptions, much like in California's just cause eviction law.
These changes are significant and have far-reaching implications for both landlords and tenants. With affordable housing in short supply and rents on the rise, Santa Barbara and California are moving towards limiting month-to-month leases and making it harder for landlords to evict tenants with short notice.
Both property owners and renters must not only understand these laws but also adapt to them when drafting leases to ensure compliance and fairness. It's a new era in landlord-tenant relations, and we all need to be prepared.