Legal Corner Q & A
by Various Authors
Q. What recourse does a landlord have when a tenant is using both the apartment and garage for a commercial enterprise?
A. The first line of inquiry is to determine what the lease agreement states with regard to commercial use. Is there an express prohibition in the rental agreement against operating a business for both the apartment and the garage? If the lease does not specify permissible uses or does not restrict conduct, the tenant may use the apartment for any lawful purpose that is not materially different from ordinary use, or for the purpose for which the unit was constructed.
The most recent version of the PPMA lease contains language that defines permissive use. In terms of the apartment, the lease states that use is limited to “living, sleeping, cooking and dining purposes, and for no other purpose...” For the garage, the tenant must agree that the parking space shall be used “exclusively for the parking of motor vehicle(s). Absolutely no automotive cleaning, washing, maintenance or repair work of any kind and no storage of any kind shall be permitted in or about the parking space(s).”
If your rental agreement contains these or similar prohibitions, then you must analyze whether or not you, or your manager, or even the prior owner allowed this tenant to use the apartment and garage for commercial purposes. If past permission was given and/or management looked the other way, then the tenant's conduct may be permitted even if the lease prohibits it. This is called waiver and estoppel, and tenants always employ these legal defenses as a basis to thwart a landlord's eviction attempt.
If the lease prohibits commercial use and there is no waiver or estoppel, then the owner should immediately serve a Three-Day Notice to Perform Covenant or Quit. This notice demands that the tenant cease commercial operations within three days or surrender possession of the rental unit. Failure to do either will allow the owner to file an eviction action with the court. During this proceeding, the owner will have to prove that the tenant breached the lease provision(s) prohibiting commercial use and further failed to correct the violation within the three-day period after receiving service of the eviction notice.
If the lease is not clear about commercial use or management may have ignored past violations, the owner may consider whether or not the commercial activity in either or both the apartment and garage violates local health and safety or zoning laws. For example, a tenant who is running a retail establishment out of the garage may be breaching a planning code or a neighborhood restriction. If so, the owner may be able to serve a notice for illegal use that could also result in an eviction action. Indeed, some landlords have reported themselves to the city for their tenants' unlawful conduct in order to receive a citation, which in turn gives rise to just cause for termination of the tenancy.
Please note that home-office use is usually considered reasonable and therefore permissible. Most practitioners advise landlords that prohibiting a home office would not be enforceable. However, when a tenant begins seeing clientele or members of the public, the enterprise may become commercial and subject to prohibition. In addition, residential tenants have the absolute right to operate a small daycare business (six or fewer children), despite a lease provision to the contrary.
In sum, the most important document is the lease, which should confine permissive use to residential purposes, thus ruling out the possibility that your tenant might assert a legal right to conduct business out of the unit. Act promptly when you discover a violation in order to avoid the waiver/estoppel defenses. Last, as with any legal action, please consult with a qualified attorney before making a move.
– David Wasserman
Q. When performing agreed-upon repairs in a tenant's apartment, can we perform additional repairs if we encounter them during the visit?
A. A residential landlord does not have unrestricted access to a tenant's dwelling unit. However, a landlord does have reasonable access rights to dwelling units in certain circumstances. For instance, after giving proper notice to the tenant, a landlord may enter a dwelling unit to make necessary or agreed-upon repairs, decorations, alterations or improvements, supply necessary or agreed-upon services, or exhibit the dwelling unit to prospective or actual purchasers, mortgagees, tenants, workers or contractors.
Once the landlord has properly entered the dwelling unit to perform agreed-upon repairs, the landlord may perform additional reasonable repairs that are encountered during the visit. In fact, doing so is consistent with a landlord's obligation to provide a habitable dwelling unit that is fit for occupancy. Please note that if the additional repairs cannot be completed during the landlord's entry, then the landlord may be required to give the tenant another notice to enter at a future date and time. Moreover, the landlord may have additional obligations if the work to do the repairs would render the unit uninhabitable while the work is in progress or would substantially reduce the tenant's housing services. In such a case, the landlord should consult with an attorney.
–Steve Williams
Q. Would you please review the Proposition 65 requirements for proper posting of signs in or around apartment buildings?
A. If you have not already done so, you should post Prop. 65 warning signs at your apartment building(s) immediately. Note that merely posting a warning does not constitute an admission. The California Office of Environmental Health Hazard Assessment (OEHHA), the agency that implements Prop. 65, states that posting a warning sign can mean one of two things: (1) you have identified and evaluated chemicals on the property and know that the chemicals present a significant risk to occupants and guests; or (2) you have provided a warning simply based on the belief that a chemical could be present. You have not taken any steps to determine if the chemicals are located at the property; you have simply taken a precautionary step.
The proper posting of the warnings includes three elements—size, content and location of the signs. OEHHA requires that Prop. 65 warnings “must be reasonably calculated, considering the alternative methods available under the circumstances, to make the warning message available to the individual prior to exposure. The message must clearly communicate that the chemical in question is known to the state to cause cancer, or birth defects or other reproductive harm.” This may sound confusing, and it is. However, the California Apartment Association (CAA) has signs available to you that meet the OEHHA requirements for size and content.
As for location of the signs, you must do the most appropriate of the following: (1) post a warning sign in the “affected area”; (2) post warning signs at all usual points of entry; (3) mail or deliver a warning notice to each occupant (these notices are also available from CAA); or (4) deliver a public-media announcement that targets the affected area. Clearly, the method you choose will depend on the size and physical setup of your building(s).
We recommend that you post warning signs at all points of entry, including garage or basement entrances; post in all common areas, including lobbies, pools and laundry rooms; and send the warning notice to each existing tenant, along with a cover letter to your tenants to calm their fears about your posted Prop. 65 warnings (a sample letter is available from CAA). Also, you must provide the warning notice to all new tenants at the time of the lease's execution and post a sign on every employee bulletin board and administrative office, if any, in your building(s). You can purchase Prop. 65 warning signs and brochures through SFAA, 415-255-2288.
—Sally Morin & James M. Millar
The opinions expressed in this article are those of the authors and do not necessarily reflect the viewpoint of SFAA or the San Francisco Apartment Magazine. The information contained in this article is general in nature. Consult the advice of an attorney for any specific problem. David Wasserman is with Wasserman & Taxman, 415-567-8230. Steve Williams is with Wiegel & Fried, LLP (415) 552-8230. James M. Millar and Sally Morin can be reached at 415-981-8100. Copyright © 2005 by the San Francisco Apartment Magazine. All rights reserved.