sfaa legislative update: Proposition M
Updated May 20, 2009
The following information was shared with all SFAA members May 20:
SFAA AND INDUSTRY PREVAIL!
Superior Court Rules Award of Attorney Fees to Tenants Unconstitutional Under Proposition M
May 19: Judge Charlotte W. Woolard of the San Francisco Superior Court ruled today in favor of our challenge to Proposition M, passed by San Francisco voters on November 4, 2008.
The lawsuit challenging Proposition M was brought by the SFAA and a coalition of individuals and housing industry organizations, including SFAA members Norm Larson and Honor Bulkley, the Coalition for Better Housing, and the San Francisco Association of Realtors.
Proposition M, spearheaded by Supervisor Chris Daly, amended the San Francisco Rent Stabilization and Arbitration Ordinance, under the guise of prohibiting harassment of tenants by landlords. It also authorized the recovery of attorney’s fees to tenants who prevailed in an eviction lawsuit without providing similar rights to landlords who won their eviction suits.
Judge Woolard ruled that the attorneys’ fees provision was a violation of the equal protection clause because it created a single class of litigants or a single class of lawsuits. At the same time, Proposition M deprives landlords of any right to collect their fees should they prevail. This unequal treatment is unconstitutional.
"San Francisco's tenant lawyer stimulus package is dead," declared attorney and CBH member Clifford Fried, who along with John Baba argued our case. "The attorneys fees component of the new law was nothing more than another way for tenant lawyers to profit at the expense of landlords trying to navigate the complex set of rules that govern landlord tenant relationships in San Francisco," said Fried.
Proposition M also prohibits 15 different kinds of conduct and speech by a landlord, when done in bad faith, without honest intent or with ulterior reason.
Judge Woolard also declared that portions of the tenant harassment law were unconstitutionally vague. Proposition M sought to prohibit landlord conduct undertaken "with ulterior motive or without honest intent." The language was an attempt to prevent landlords from communicating with their tenants with the intent of making an offer to buy out a tenant in exchange for offers of payments. Judge Woolard's ruling validates our argument that such a prohibition is a violation of a landlord's First Amendment right of free speech.
Left standing, however, is the portion of Proposition M that prohibits conduct carried out by the landlord in "bad faith." However, the industry still has concerns that landlords will not understand the meaning of "bad faith" harassment. The prohibition against bad faith harassment implies that the proscribed conduct, when undertaken in good faith, is permissible.
Congratulations to all of the other plaintiffs and our counsel John Baba, Clifford Fried and Andrew Wiegel of Wiegel & Fried.