court talk

By Clifford E. Fried

A few months back, “Court Talk” covered the California Supreme Court decision in Action Apartment Association v. City of Santa Monica, a case dealing with the litigation privilege and evictions. The privilege, codified at Civil Code Sec. 47(b), provides that a publication or broadcast made as part of a judicial proceeding is absolutely privileged, irrespective of maliciousness. In the landlord-tenant arena, it protects landlords from wrongful eviction or rent ordinance violation claims simply because the landlord files an eviction lawsuit.

Another defensive weapon that landlords use to vaporize tenant lawsuits is the anti-SLAPP (Strategic Lawsuit Against Public Participation) motion. Several new appellate court decisions relate to these motions. As courts begin interpreting the meaning and effect of Action Apartment Association and the anti-SLAPP laws, we see that there is a developing split of authority between the Northern and Southern California appellate courts.

Frieda Marlin v. Aimco Venezia, LLC
A long line of court cases interpreting the Ellis Act holds that a landlord has an unfettered right to go out of business. The act allows landlords who comply with its terms to go out of the rental business by evicting their tenants and withdrawing all units from the market, even if doing so would otherwise violate a local rent ordinance.

But prior case law didn’t prevent some Los Angeles tenants from seeking a court declaration that their landlord was not entitled to invoke or rely upon the Ellis Act. In Frieda Marlin v. Aimco Venezia, LLC, the Marlin family filed a complaint for declaratory relief a few months after receiving notices to vacate under the Ellis Act.

The landlord responded to the lawsuit with a special motion to strike the complaint called an anti-SLAPP motion. The motion is based upon the anti-SLAPP statute, which provides that a claim against a person arising from any act of that person in furtherance of the person’s right of petition or free speech in connection with a public issue shall be subject to a motion to strike, unless the court determines that the plaintiff has established a probability of prevailing on the claim.

Anti-SLAPP motions have become important weapons in a landlord’s defense arsenal in response to spurious tenant lawsuits. Recently, several landlords in San Francisco have won anti-SLAPP motions in tenant lawsuits. The result has been a sharp decline in affirmative tenant lawsuits against San Francisco landlords. Landlord Aimco Venezia wasn’t so fortunate.

Aimco Venezia contended that its tenants’ lawsuit arose from Aimco Venezia’s acts of filing and serving the Ellis Act notices, and there was no probability the tenants would prevail in their action. The trial court granted Aimco Venezia’s anti-SLAPP motion and dismissed the lawsuit.

The Court of Appeal for the Second Appellate District disagreed and reversed that decision. The Second District said that the mere fact that a lawsuit was filed after protected activity took place doesn’t mean the action arose from that activity for the purposes of the anti-SLAPP statute. The critical question, the court said, is whether the claim is based on the landlord’s protected free speech or petitioning activity. In an unusual instance of hair-splitting and semantics, the Second District conceded that the filing and service of the Ellis notices may have triggered the filing of the tenants’ lawsuit, but the notices were not the cause of the tenants’ lawsuit.

The court said it was clear that the tenants’ lawsuit was caused by the landlord’s allegedly wrongful reliance on the Ellis Act, and terminating a tenancy or invoking the Ellis Act are not activities in the furtherance of petition or free speech. The court ruled that the Marlins’ lawsuit was based upon a contention that Aimco Venezia was not entitled to invoke or rely upon the Ellis Act and not upon the actual filing and service of Ellis notices.

The holding and rationale used by the Second District is problematic for landlords who are sued after invoking the Ellis Act. All a tenant need do is sue the landlord and make a claim that the landlord isn’t entitled to invoke the Ellis Act; Frieda Marlin v. Aimco Venezia, LLC now stands for the proposition that such claims will withstand an anti-SLAPP motion. Or does it?

Regina Birkner v. Kwai Ho Lam
A San Francisco trial court also believed that a tenant’s claims in a lawsuit were not based upon her landlord’s petitioning activity and denied a motion to strike under the anti-SLAPP statute. But the Court of Appeal for the First District disagreed and reversed the decision.

On December 8, 2005, landlord Kwai Ho Lam served a relative move-in notice so that his mother could occupy tenant Regina Birkner’s apartment. Lam was already residing in the building and wanted his disabled mother to move into Birkner’s ground-floor apartment. Birkner immediately claimed she was a protected tenant and demanded a rescission of the eviction notice. On February 2, 2006, Lam’s mother died. On February 13, 2006, Lam informed Birkner of his mother’s death and rescinded the eviction notice.

Birkner responded by filing a lawsuit based upon violations of the San Francisco Rent Ordinance (attempted wrongful eviction). The trial court denied Lam’s motion to strike the complaint because Lam’s service of the eviction notice was not in furtherance of his right to petition within the meaning of the anti-SLAPP statute.

An anti-SLAPP motion in a tenant lawsuit involves a two-part inquiry by the trial court. First, the landlord must make a preliminary showing that the claim arises from an act in furtherance of his or her constitutional rights of petition or free speech. If such a showing has been made, the burden then shifts to the tenant to demonstrate a probability of prevailing on the claim; if the tenant fails to carry that burden, the claim is stricken.

In Birkner v. Lam, the First District Court of Appeal said that, in analyzing the first part of the inquiry on a motion to strike, the critical consideration is whether the claim is based on the landlord’s protected free speech or petitioning activity.

The prosecution of an unlawful detainer action is protected activity within the meaning of the anti-SLAPP statute. But the Second District Court of Appeal in Marlin v. Aimco Venezia held that terminating a tenancy or removing a unit from the market under the Ellis Act was not protected activity. The First District Court of Appeal distinguished Marlin v. Aimco Venezia by noting that Birkner wasn’t challenging the validity of the rent law or any activity by Lam that preceded the service of an eviction notice. Birkner’s claim of liability was based solely upon service of the eviction notice—activity that is protected under the anti-SLAPP statute.

Birkner’s attorneys argued that Lam was obligated to prove, under the first prong of the anti-SLAPP statute, that serving and refusing to rescind an eviction notice is protected by the litigation privilege. But the court ruled that it isn’t necessary for the landlord, making a motion to strike, to establish that his actions are constitutionally protected under the First Amendment as a matter of law. Nor does a landlord’s conduct lose its coverage under the anti-SLAPP statute simply because it is alleged to have been unlawful.

The trial court in Birkner v. Lam never decided whether or not tenant Birkner would probably prevail on her claim—the second prong of an anti-SLAPP motion—because it ruled that Lam failed to meet the first prong (that Birkner’s claim was based upon protected speech or petitioning activity) and denied the motion to strike. The case now goes back to the trial court to
decide the second prong.

The Court of Appeal said that on remand the trial court must decide, in light of the Action Apartment Association decision, whether Lam’s litigation privilege will defeat Birkner’s claim that she will probably prevail on her claim of wrongful eviction. Action Apartment Association held that prelitigation communication, such as the service of an eviction notice, is privileged only when it relates to litigation that is contemplated in good faith and under serious consideration.

On remand, the trial court must evaluate Birkner’s evidence to determine if she can make a sufficient showing to negate Lam’s claim that litigation was contemplated in good faith and under serious consideration. No matter how this case is ultimately resolved, the decision of the Court of Appeal is extremely helpful for landlords being sued solely on the basis of serving an eviction notice.

Dept. of Fair Employment and Housing v. 1105 Alta Loma Rd. Apts.
A landlord entity (a limited liability corporation) was sued by the Department of Fair Employment and Housing after it decided to remove an apartment building from the rental market by invoking the Ellis Act. The trial court denied the landlord’s motion to strike under the anti-SLAPP statute.

One of the tenants who received an Ellis Act notice from her landlord claimed she was disabled and requested that her tenancy be extended for a full year as required by the Ellis Act and the West Hollywood Municipal Code. The landlord requested confirmation of the tenant’s claim of disability to determine whether it was a qualifying disability under the applicable statutes.

The tenant’s doctor provided a letter that merely said the tenant was totally disabled without providing a diagnosis. This left the landlord with no way of ensuring that the tenant qualified as disabled within the meaning of the Ellis Act or knowing if the tenant was in fact entitled to the one-year extension. The landlord demanded evidence of disability that would qualify the tenant for an extension under the Ellis Act.

The tenant refused to divulge details about her disability and was ultimately removed after an unlawful detainer action. The DEFH brought a claim, on behalf of the tenant, against the landlord for disability discrimination. The lawsuit sought damages for emotional distress and punitive damages for housing discrimination, denial of civil rights and disability discrimination.

The landlord filed an anti-SLAPP motion, which was denied by the trial court. The trial court ruled that the allegations of DEFH’s complaint didn’t concern the landlord’s right to invoke the Ellis Act and, therefore, DEFH’s claim didn’t arise from the landlord’s exercise of his free speech or petition rights.

The Second District Court of Appeal affirmed finding that the gravamen of DEFH’s claim was for disability discrimination and not related to any action of the landlord while invoking the Ellis Act. DEFH’s claim concerned the landlord’s alleged acts of disability discrimination in refusing to accept the tenant’s claim of disability and in failing to accommodate her disability in extending her tenancy. The court said that the mere fact that a claim was filed after protected activity took place doesn’t mean the claim arose from that activity.

The holding in this case is problematic because it opens the door to claims of disability discrimination whenever a landlord attempts to recover possession under the Ellis Act and the tenant makes a claim, valid or spurious, of disability. In effect, a landlord can never challenge a claim of disability for fear of being sued.

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The opinions expressed in this article are those of the authors and do not necessarily reflect the viewpoint of SFAA or SF Apartment Magazine. The information within this article is general in nature. Consult an attorney for any specific problem. Clifford E. Fried is a partner with Wiegel & Fried, LLP, 415-552-8230. Copyright © 2008 by SF Apartment Magazine. All rights reserved.