Legal Corner Q & A

When a Tenant Rescinds a 30-day Notice to Vacate

By Various Authors

Q. I recently received a 30-day notice of intent to vacate from one of my tenants. About two weeks later, I received a note from the tenant informing me that she was rescinding her notice to vacate. Having already advertised the unit and accepted deposits, I was a little perturbed. What are my options?

A. Unfortunately, you do not have many options. As you know, a landlord may not recover possession of a rental unit from a tenant without one of the 14 “just cause” reasons for eviction found in THE RentOrdinanceSection37.9(a). Breach of notice to vacate, i.e., rescission of a 30-day notice to quit, is not one of the 14 “just cause” reasons. As a result, you may not evict the tenant for rescission of the notice. Nevertheless, you are at least entitled to recover your costs of advertising and showing the apartment in reasonable reliance on the tenant’s representations.Theseshouldbe claimed by way of Small Claims Court.

A different result might obtain if you had in fact signed a lease or rental agreement with a proposed new tenant for the unit to be vacated. Your lease might legally obligate you to perform, thereby placing you between a legal rock and hard place. It’s difficult to say exactly how this would play out. One option might be to sue, or threaten to sue, the tenant who has rescinded the 30-day notice for any damages you might suffer if you are sued by the party with whom you had signed the lease. Theoretically, you could sue your tenant for a judgment declaring that by giving you the notice to vacate and thereby placing you in a position of jeopardy for breach of a lease contract into which you entered as a result, your current tenant is thereby “estopped,” or prevented, from withdrawing the 30-day notice, and must therefore move out. As a practical matter, such a course is potentially too expensive and lengthy to be of any real value, and the probable result is much to “iffy.” Moreover, even where a new lease has been signed, in most cases the refusal of the current tenant to move out will simply lead to a cancellation of the lease by both landlord and would-be tenant. Serious repercussions might conceivably occur if the current tenant refused to move out at the last minute and the new tenant had already given up his or her apartment—or perhaps moved to San Francisco from the East Coast, anticipating moving in—and was anxiously awaiting entry with nowhere else to go.

Each case is different and solutions will probably best be reached through individual negotiation of the particular facts. Nevertheless, the landlord would always be well advised to make the new lease contingent, in writing, on the current tenant’s surrender of possession, with a waiver of any liability to the proposed new tenant if the landlord cannot deliver possession because the existing tenant has rescinded his or her notice to vacate.
— Saul Ferster

Q. What kind of laws do I have to follow when dealing with an on-site manager?

A. Having a resident manager is extremely helpful, especially if the landlord owns multiple properties in various locations and Landlording is not a full-time occupation. In fact, for properties consisting of 16 or more residential units, the law requires that there be a resident manager, janitor, housekeeper, or other “person in charge” living on the premises. Moreover, the law also requires that the landlord notify the tenants of the name of the manager and owner or other agent who can receive notices, demands, complaints, etc.

The manager, whether on-site or off-site, may be either an employee or an independent contractor. If the owner exercises control only over the result of the work and not over the means for achieving the result, the manager may be an independent contractor. However, in most instances, the landlord will want to exercise control over how the building is managed. Thus, the manager will be an employee, and the legal nature of the relationship will be determined by employment laws governing wages and hours, social security payments and deductions, income tax and withholding, unemployment insurance, and workers’ compensation insurance.

For example, as the owner you must deduct all of the tax withholdings that you would have to impose on any other type of employee. Obviously, a complete discussion of the tax/wage ramifications of an employee manager is beyond the scope of this article. It is advisable to consult a professional before you hire a manager.

You should also be aware of certain laws in California that limit the amount of a resident manger’s rent that can be applied to the manager’s wages. In most instances, you cannot just use “rent” as the basis for all compensation. (Again, a full discussion of these laws is beyond the scope of this article.)

Moreover, in San Francisco—as in other rent-controlled jurisdictions—you must be careful about employing a resident manager and creating a rent-controlled tenancy subject to the rent ordinance’s “just cause for eviction” requirement. That is, you want to have the option of evicting the manager if his/her management services are terminated. Unfortunately, the S.F. Rent Board takes a very aggressive stance on conditioning occupancy of a unit on employment as a resident manager. While there is no way to guarantee removal of a resident manager upon termination of employment, the landlord should carefully spell out in the management contract that the manager will be residing in the building’s designated manager’s unit, that their housing unit is provided solely as a precondition to employment as the resident manager, and that termination of employment requires a vacation of the employee’s housing. To reiterate,thisissue is complicated in San Francisco,so please consult an expert before hiring a manager.

Finally, be aware that if your manager is an employee, the state and federal employment laws governing discrimination in employment may apply. These laws generally prohibit adverse employment actions against persons because of their race, sex, religion, or age. In fact, some courts have held that an allegation of wrongful employment termination is a complete defense to an unlawful detainer (or eviction) action of a terminated resident manager. So, as with most issues in the landlord-tenant realm, be well informed before you act.
— David Wasserman

Saul M. Ferstercan be reched at 863-2678. David Wassermanis with Wasserman & Taxman, 567-8230. The opinions expressed in this article are those of the author and do not necessarily reflect the viewpoint of the SFAA or the SF Apartment Magazine.