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Words Can Hurt You
by Clifford E. Fried
On November 4, 2008, San Francisco voters overwhelmingly approved Proposition M: the so-called tenant harassment amendment to the San Francisco Rent Ordinance. Passage of the new law was promptly met with a court challenge by SFAA, as well as other organizations and individuals. On January 21, 2009, San Francisco Superior Court Judge Paul H. Alvarado granted Petitioners’ ex parte application and ordered that the implementation of Prop. M be stayed until a final determination on the merits of Petitioners’ writ of mandate. A hearing will be held on April 17, 2009.
San Francisco’s Rent Ordinance has long restricted a landlord’s ability to reduce or eliminate housing services to tenants. Prop. M adds to the definition of what a housing service is. A housing service now includes a tenant’s quiet enjoyment of the premises, without harassment by the landlord.
An entirely new section has been added to the Rent Ordinance to define what conduct is considered to be harassment of a tenant. Section 37.10B says that harassment is considered certain actions by a landlord, done in bad faith, with ulterior motives or without honest intent.
Section 37.10B prohibits 15 different kinds of conduct by a landlord, or any agent, contractor, subcontractor or employee of the landlord. Conduct prohibited under the new law includes things like failing to provide housing services or make repairs required by the rental agreement or law. These prohibitions sound reasonable, but some of the other prohibitions are illogical, petty, problematic, in conflict with other laws, or in violation of federal and state constitutions.
For example, Prop. M prohibits a landlord from influencing a tenant to vacate through intimidation or coercion, including offers of payments accompanied by threats. Such prohibitions run afoul of a landlord’s First Amendment right of free speech. The Court of Appeal made it clear in Baba v. San Francisco Board of Supervisors that landlords have free speech rights. The Baba decision in 2002 gave the green light to landlords to approach their tenants with offers to buy out their tenancies. Prop. M improperly strips property owners of their rights and will make it difficult for landlords to communicate with their tenants without fear of violating the law.
Other prohibitions in Prop. M are aimed at preventing a landlord from interfering with a tenant’s right to privacy. The new law even prohibits questioning a tenant about his or her residency or social security number. In other words, asking a tenant who has moved into the unit whether the tenant is still employed, or whether a new dog is necessary to accommodate a disability, could all lead to a lawsuit against the landlord. Obtaining credit reports without a social security number will become impossible. Filing 1.21 Petitions at the San Francisco Rent Board will become pointless because landlords won’t be able to question tenants about their true residences.
Under Prop. M, landlords can no longer refuse to accept a tenant’s rent payment or refuse to cash a rent check for over 30 days. Most diligent landlords can’t wait to cash a rent check. But forgetting to cash a check could now lead to a nasty lawsuit by the tenant. And what are landlords now supposed to do when an unknown subsequent occupant attempts to make a rent payment? If the landlord guesses wrong and refuses to accept the payment, there could be liability for violating the Rent Ordinance.
An interesting question arises when a landlord is in the middle of an unlawful detainer action and the tenant attempts a rent payment. May the landlord refuse the payment? Prop. M makes refusal of the payment illegal. Other laws say that accepting payment waives an outstanding eviction notice and renders an unlawful detainer action subject to dismissal.
An aggrieved tenant has several remedies under Prop. M for a claimed act of harassment by the landlord. First, the tenant can file a petition at the Rent Board for a rent decrease based upon a decrease in housing services. Second, a tenant claiming harassment may sue for injunction and damages for not less than three times actual damages, punitive damages and attorneys’ fees. Third, the tenant may assert a violation of the law as an affirmative defense in an eviction lawsuit.
The new law permits any person or the City of San Francisco to enforce Prop. M. This means that anybody can file a lawsuit, even if he or she wasn’t the target of the alleged harassment! This will no doubt lead to many frivolous lawsuits by greedy third parties and lawyers looking to make a quick dollar whenever they discover a technical claim of harassment.
Any person convicted of violating Prop. M will be guilty of a misdemeanor, punishable by a fine of up to $1,000 and/or imprisonment for up to six months.
Two additional aspects of Prop. M should be a cause for alarm. Under the new law, in any eviction action where the tenant prevails, the tenant may be awarded attorneys’ fees, but in the case of a prevailing landlord, these fees will not be awarded. This provision is completely unrelated to harassment and was designed to override form leases, such as the SFAA Tenancy Agreement, that omit an attorneys’ fees provision.
Prop. M also provides that any violation of the Rent Ordinance, even unrelated to harassment, may be asserted as a defense in an unlawful detainer action. Thus, a technical violation of the Rent Ordinance, unrelated to an eviction, could thwart a landlord’s right to recover possession. For example, an improper rent increase four years ago could prevent a landlord from moving into his own property today.
Prop. M contains several improper changes in the law that were placed on the ballot by our Board of Supervisors (though it must be noted that Supervisors Michaela Alioto-Pier, Carmen Chu, Bevan Dufty and Sean Elsbernd were against it). With all of the inevitable upcoming budget cuts, it is sad that the city will have to waste taxpayer money by incurring legal fees to defend Prop. M.
The information contained in this article is general in nature. Consult the advice of an attorney for any specific problem. Clifford E. Fried is with Wiegel & Fried, LLP and can be contacted at 415-552-8230. Copyright © 2009 by Wiegel & Fried, LLP. All rights reserved.