Legal Corner Q & A
by Various Authors
Q. Recently, a tagger started hitting the outside of my building on a pretty regular basis. Every time he comes, I clean it off immediately, but he just keeps coming back. At this point, it has become too expensive and time consuming and I want to give up. But I’ve heard that I could be fined by the city if I don’t clean it up. Is this true? If so, what kind of fines could I face?
A. It is unlawful for a property owner to allow graffiti to remain on their property (SF Public Works Code, Art. 23, Sec. 1300 et seq.). If you are found in violation of the code, the city will serve you with a notice of violation and post the notice on your property. You must either remove the graffiti at your own expense or request a hearing within thirty days of the date of the notice.
If you opt for a hearing and lose, the city can order the graffiti abated and remove the graffiti itself at a cost to you of $500 or the actual cost to remove it, whichever is greater. The city may also recover its attorneys’ fees from you. Please note also that a lien can be placed on your property if you do not pay within thirty days of receiving the abatement accounting, which shows the amount you owe the city. Alternatively, the city may provide paint to you free of charge if you agree in writing to paint the graffiti yourself within ten business days. However, failure to remove it by the agreed-upon time is cause for another notice of violation.
If at the hearing you demonstrate that the frequency and extent of the graffiti is such that removal imposes a hardship on you, the city may simply authorize and conduct the removal at no cost to you, provided that you release them from any liability. You can contact San Francisco’s “Graffiti Hotline” at 415-241-9274 to discuss with them whether or not it would be worth it to request a hearing rather than just clean up the graffiti yourself.
The purpose behind requiring property owners to clean up graffiti on their own buildings is that graffiti results in visual pollution and fosters disrespect for the law, resulting in an increase in crime. Your property is an important investment, and whether you are fined or not, you want to maintain your investment in the best condition possible.
—Tina Collins & Sally Morin
Q. Does the landlord have the right to know the names of people staying in the unit if they are not on the original lease? Can the landlord ask the new occupants to fill out an application and run a credit check on the new occupants?
A. As with so much in the landlord-tenant relationship, the landlord’s rights relative to these questions are defined by the rental agreement. Without a right given in the agreement, strange as it may seem, the landlord would not normally be entitled to know who, other than his tenant, is in his property.
Most rental agreements provide that a tenant may not sublet or assign without the landlord’s prior consent. Obviously, if the tenant has moved somebody unknown into the premises, he has breached that requirement. Unfortunately, failure to act in a timely manner may result in a waiver of the landlord’s right to compliance. Thus, if persons are in the unit whose presence has been known, and rent has been accepted, even if only from the original tenant, the landlord may have lost his rights regarding these new “occupants.”
Of course, there is absolutely nothing prohibiting a landlord from asking already ensconced new occupants their names, and if the landlord wishes, to fill out an application and submit to a credit check. Be aware, however, that following this procedure tends to put the landlord into a closer relationship with these new occupants than may be desired, possibly making them his tenants, enjoying the right to the below-market rent established by the original occupant when the latter vacates, if steps are not taken to prevent that. Therefore, rather than routinely taking credit applications, think through what you are seeking to accomplish to determine if it is necessary. Obviously, at the very least you should serve a notice pursuant to Section 6.14 of the San Francisco Rent Board Rules and Regulations, designed to preserve your right to a market rent when the last original tenant goes. This must be done within 60 days of the time that you first become aware of the new occupant. The notice should be served on all occupants in the unit, but especially on the new occupant, because it is against him that you are seeking to protect yourself. Don’t trust that service to your tenant—do it yourself.
Finally, as for asking for names and other information where the occupants can’t be compelled to give it to you, I am reminded of a nineteenth-century criminal case heard by a Judge Magruder. The case involved a young woman who felt that a gentleman who passed her on the street had made an indecent proposition. The man was arrested and charged with a crime. Upon hearing the evidence, Judge Magruder acquitted the accused, issuing in the process what became known as the Magruder Doctrine: “There’s no harm in asking.” Don’t ever forget the Magruder Doctrine.
—Saul M. Ferster
Q. We have an onsite manager who does not wish to be paid as an employee. He wants to maintain his rights as a renter and not report any income. How can we compensate him for his services? If we subsidize his rent, does that count as “income”?
A. What the manager has suggested is illegal. A resident manager is not an independent contractor and must be paid as an employee. The resident manager is entitled to the protections of general labor and wage laws, just like any other employee. The manager must be paid at least the minimum wage under California law ($6.25), and in San Francisco not less than $8.82 per hour. The manager is entitled to overtime wages if he or she works over 40 hours per week for any day that he or she works more than 8 hours. The employer must pay payroll taxes, including Social Security, report wages and deductions at least quarterly, and maintain workers’ compensation insurance.
The employer may lawfully deduct a portion of the rent from the resident manager’s wages if the employee has signed a written agreement permitting this. If so, then the employer may deduct up to two-thirds of the market rental value of the unit up to a maximum of $381.20 per month. The maximum deduction is higher if the employer has hired a couple who both serve as resident managers. The balance of the wages after deductions must be paid to the employee in money, not rental credit.
Owner-employers may incur liability for overtime wages if the resident manager is required to be “on-call” for more than 8 hours per day or 40 hours per week. But special rules apply if the “on-call” employee is free to leave the premises and may attend his or her on-call duties from another location, based upon the frequency of calls and typical duration of any response duties. In this event, the “on-call” employee compensation may be based upon a contract rate as long as he or she receives at least minimum wage for time actually worked.
The resident manager should keep regular hours and carefully document hours worked and any overtime. The employer should carefully review these records to assure that the employee receives all wages due on a timely basis. If the employee has been underpaid for hours worked or overtime, he or she may file a claim for unpaid wages with the Office of the Labor Commissioner and the employer could be heavily penalized, even for innocent mistakes.
The resident manager has tenancy rights under California law and under the San Francisco Rent Ordinance if he or she has a tenancy agreement and/or pays any amount of rent. If so, then you may not evict the tenant just because he or she has been fired or quit. The termination of employment does not constitute just cause to evict under the Rent Ordinance. In that event, the tenancy may be terminated only based upon one of the defined just causes, such as nonpayment of rent, nuisance or illegal activity.
You may provide a free residence plus pay at least the minimum wage. If the manager has been provided a free residence and has never paid any rent, then he or she does not have “just cause” tenancy rights and you may recover possession of the unit through unlawful detainer without just cause and without first serving a written demand for possession. If you fire the manager who has never paid rent, you are entitled to immediate possession of the unit. If you want the manager to vacate immediately, be careful not to create a tenancy by accepting any rent for the unit. Given the small amount of rent that you may deduct from wages, it may make the most sense to provide a free apartment to the manager so that you do not create a tenancy.
We sometimes suggest that the employment agreement with a resident manager provides that if the employment terminates, then a new lease will be instituted at the then-current market rental rate. The standard lease terms that would become effective may be attached as an addendum to the employment agreement. However, this may not be appropriate if you are required to have a resident manager and do not have frequent vacancies. If you create a tenancy after firing your resident manager, then you are unlikely to have another vacant unit to provide for a new employee. Under these circumstances, it would be best to provide a free unit plus minimum wage so that you can evict the manager immediately after the employment terminates.
—Michael C. Hall
Q. My tenant wanted to change the color of the unit and I let her, with the provision that she must repaint the unit white when she left. She has now moved out and has not repainted the unit. Can I take the money for the paint and painters out of her security deposit?
A. Probably. Since the paint color does not relate to habitability of the unit, you should be free to make that kind of agreement with your tenant. One question is whether you adequately documented the arrangement, which would amount to a modification of the lease/rental agreement so that you could prove it, if necessary in court. Most leases, including the PPMA Residential Tenancy Agreement have provisions that lease modifications must be in writing and signed by all parties. Perhaps there is some correspondence or an estoppel certificate signed by the tenant to corroborate the arrangement. There is nothing in the security deposit or other law which prohibits a landlord and tenant from agreeing that the cost to repaint the unit is a certain fixed amount, and that the landlord can deduct that amount from the deposit at the end of the tenancy. If the amount deducted is reasonable, most courts would enforce this agreement. Under California’s Civil Code Section 1950.5 (c), a section of the security deposit statute, the landlord and the tenant are authorized to agree to a specified fee (in addition to the security deposit) for alterations to the unit (such as painting), if the tenant initiates the request.
If you were using the PPMA lease, your rights would be spelled out. Paragraph 20 of the form prohibits painting by the tenant without the prior written consent of the landlord. Under paragraph 27 of the “House Rules,” a tenant cannot paint without the prior written consent of the landlord, and if consent is given, the tenant is specifically required to restore the unit to the original paint color before vacating, and is made responsible for all such repainting costs.
If the landlord and tenant have not entered into an agreement or the tenant denies the existence of the agreement, then the landlord’s right to deduct the cost of repainting from the deposit would depend upon the color chosen for the unit or the quality of the painting. If the tenant has chosen a color that would be unacceptable to reasonable taste (such as black, dark green or pink) or if the painting consisted of substandard work, then the landlord most likely could deduct the cost of repainting the unit. However, if the tenant painted the unit with a standard color (such as white, beige or light blue) and performed the work satisfactorily, then the landlord would have a difficult time arguing that the tenant had damaged the unit, which is the condition that allows the landlord to deduct from the deposit. The tenant might even argue that she improved the condition of the unit.
—Lawrence M. Scancarelli & Jerod Hendrickson
The opinions expressed in this article are those of the authors and do not necessarily reflect the viewpoint of SFAA or San Francisco Apartment Magazine. The information contained in this article is general in nature. Consult the advice of an attorney for any specific problem. Tina Collins and Sally Morin are with the law offices of James M. Millar, 415-981-8100. Saul M. Ferster can be reached at 415-863-2678. Michael C. Hall can be reached at 415-512-9865. Lawrence M. Scancarelli and Jerod Hendrickson can be reached at 415-398-1644. Copyright © 2006 by San Francisco Apartment Magazine. All rights reserved.