Can a landlord evict a tenant for renovations during COVID-19?

At the unlawful detainer clinic, I received a phone call from a tenant who received a letter from management. The new owner of the building planned to renovate, and all leases would be terminated in 90 days. The question becomes, can a landlord evict a tenant for renovations, and (if yes) how much renovation is required for this to be a valid cause? Moreover, what are the rules given the COVID-19 restrictions on evictions?

The Rules as of September 11, 2020

On August 13, 2020, California Courts amended Emergency Rule 1. Under Emergency Rule 1, no court could issue an unlawful detainer summons except to protect public health and safety. Emergency Rule 1 expired September 1 and no longer governs unlawful detainer actions in California Courts. AB 3088 takes its place as the most recent legislation governing unlawful detainers.

Under the rules of AB 3088, landlords may not evict tenants based on COVID-19 related rental debts. The bill does not change a landlord’s ability to evict for any other purpose. One of the sections governing the right of a landlord to evict for the purpose of renovation is Code of Civil Procedure section 1946.2, and AB 3088 makes very small changes to this section.

The revised Code of Civil Procedure section 1946.2 states, “the owner of the residential real property shall not terminate the tenancy without just cause . . .” when the tenant has been in the unit for more than 12 months. (Civ. Proc., § 1946.2, as amended by Stats. 2020, ch. 37, § 8.) This language is unchanged from the original text. (Civ. Proc., § 1946.2.) In addition to having “just cause,” the landlord must also identify that just cause in the text of the eviction notice.

What is “Just Cause”?

Just cause includes the following at-fault causes (See Civ. Proc., § 1946.2, subd. (b).):

1. a breach of a material term of the lease,
2. committing a nuisance,
3. committing “waste,”
4. the lease naturally expired, and the tenant refused to execute a written extension,
5. criminal activity by the tenant (or threats of criminal activity), and
6. when the tenant fails to return possession after giving the landlord notice.

Just cause also includes the following not-at-fault causes (See Civ. Proc., § 1946.2, subd. (b).):

1. The owner intends to occupy the property (but the tenant must agree in writing to the termination if the lease was started on or after July 1, 2020).
2. Removing the real property from the rental market.
3. The owner complying with a government order.
4. Intent to demolish or “substantially remodel.”

What is a “substantial remodel”?

Subsection 1946.2(b)(2)(D) defines what is required for a remodel to be sufficient:

For purposes of this subparagraph, “substantially remodel” means the replacement or substantial modification of any structural, electrical, plumbing, or mechanical system that requires a permit from a governmental agency, or the abatement of hazardous materials, including lead-based paint, mold, or asbestos, in accordance with applicable federal, state, and local laws, that cannot be reasonably accomplished in a safe manner with the tenant in place and that requires the tenant to vacate the residential real property for at least 30 days. Cosmetic improvements alone, including painting, decorating, and minor repairs, or other work that can be performed safely without having the residential real property vacated, do not qualify as substantial rehabilitation.

Civ. Proc., § 1946.2, subd. (b)(2)(D), emphasis added

Summary

Based on the version of Code of Civil Procedure section 1946.2 that survives AB 3088, a landlord may evict a tenant citing a “substantial remodel” as the cause. AB 3088 does make it unlawful to use this tactic as a retaliation for unpaid rent. Landlords may want to think twice before evicting a tenant who owes past rent for any purpose that might be construed as a retaliatory action by the courts. Other than that, as long as the purpose of the landlord is legitimate, the law does not appear to prevent the eviction.

Additional Note

Code of Civil Procedure section 1946.2 was modified only slightly. Throughout this section of the code, references to “duplexes” were modified to “property containing two separate dwelling units within a single structure.” The modifications in language clearly separate the rules under 1946.2 to exclude “Alternative Dwelling Units” or ADUs.

The California Legislature introduced the ADU as a means to increase the population density. In areas zoned for single family residences, owners may construct ADU’s in order to increase the number of residences without violating the zoning regulations.

Except for this change to subdivision (e)(6), no other change was made to the rules of “just cause” in the new bill.

Expanding your investments

If you enjoy reading about how to protect your investments, check out some of my other articles. Some landlords like to claim that they are moving into a property to evict their tenant, find out why saying that you plan to occupy a rental unit may be a bad idea.

Additionally, Bakersfield has many properties that share a single water source for multiple units. Discover whether the law allows a landlord to charge the water bill to the separate tenants.

Naturally, I endeavor to be one of the elite realtors in Bakersfield, and the best method I know to protect my clients’ interest is to constantly study and increase my knowledge in areas that will be useful.

Watson Realty encourages agents like me to add value any way that we can, and I hope that I have added value to you today. If you are ready to expand your investment portfolio, contact me so that I can help you buy your next rental unit.