On a unanimous vote yesterday, May 6, 2020, the Los Angeles City Council passed an ordinance (“New Ordinance“) amending rules in the Los Angeles Municipal Code that temporarily prohibit the eviction of residential and commercial tenants in the City of Los Angeles for failure to pay rent due to COVID-19.  Notably, the New Ordinance would extend the prohibition period on evictions.  The original period was previously limited to the local emergency period as declared by Mayor Eric Garcetti.  For residential tenants, the new prohibition period would extend to include the “Local Emergency Period” plus 12 months after the end of such period.  And for commercial tenants the new period prohibiting evictions would extend through the f plus 3 months after the end of the emergency period.  Please note that the final version of the New Ordinance was not available with the Council Clerk file as of the time of publication given that the ordinance was the subject of several amendments as it was considered by Council during yesterday’s virtual hearing that went into the evening.  Also, these amendments will not take effect until Mayor Garcetti signs the New Ordinance, which is expected to be completed in short order.

The protections in the Los Angeles Municipal Code were original introduced in Ordinance No. 186585 and is herein referred to as the “Original Ordinance”.[1]

As summarized below, the New Ordinance modifies or expands on the provisions in the Original Ordinance in the following notable ways:

  1. The New Ordinance would extend the prohibition period on evictions past the Local Emergency Period by 12 months for residential tenants and by 3 months for commercial tenants.  The “Local Emergency Period” is unchanged and defined in the New Ordinance as March 4, 2020 until the end of the local emergency as identified by the Mayor.  The end date of the emergency period is unknown.
  2. The New Ordinance would modify the Los Angeles Municipal Code to prohibit evictions of residential tenants during the Local Emergency Period for a “no-fault reason” as well as for: (1) unauthorized occupant or pets; and (2) for nuisance related to COVID-19.
  3. The New Ordinance now defines any no-fault reason as such term is defined in the California Civil Code section 1946.2(b) and the City of Los Angeles Rent Stabilization Ordinance.
  4. Unlike the Original Ordinance, the New Ordinance adds new language stating that landlords may not “endeavor to evict” tenants during the Local Emergency Period for circumstances due to COVID-19.
  5. The term “endeavor to evict” is defined in the New Ordinance as any “conduct where the Owner lacks a good faith basis to believe that the tenant does not enjoy the benefits of this article and the Owner serves or provides in any way to the tenant: a notice to pay or quit, a notice to perform covenant or quit, a notice of termination, or any other eviction notice”.
  6. For commercial and residential tenants the eligible circumstances due to COVID-19 that trigger the protections in the New Ordinance remain the same and include:
    a. loss of income due to workplace closures;
    b. child care expenditures due to school closures;
    c. health care expenses related to being ill with COVID-19 or caring for a member of the tenant’s household or family who is ill with COVID-19; or
    d. reasonable expenditures that stem from government-ordered emergency measures.
  7. An owner may not “influence or attempt to influence” a residential tenant to transfer or pay to the owner any sum received by the tenant as part of any governmental relief program.
  8. A notice of the protections in the New Ordinance must be issued to residential tenants within 15 days of the effective date of the New Ordinance, as compared to 30 days in the Original Ordinance.  The notice to residential tenants must also be issued during the Local Emergency Period and for 12 months after its termination each time the owner serves a notice to pay or quit or other eviction notices, including any notice required under California Code of Civil Procedure section 1161 and California Civil Code section 1946.1.
  9. A form of the notice to residential tenants is to be prepared by the Los Angeles Housing and Community Investment Department (“HCID”).  The HCID form must be used by owners without modification.
  10. Nothing in the New Ordinance eliminates any obligation to pay lawfully charged rent.  The New Ordinance provides residential tenants with up to 12 months following the expiration of the Local Emergency Period to repay any rent deferred during the Local Emergency Period.  Commercial tenants are provided 3 months following the expiration of the Local Emergency Period to pay any rent deferred during the Local Emergency Period.
  11. The term “Owner” now includes a “successor in interest”.  The use of the term “predecessor in interest” in the Original Ordinance is deleted.
  12. Tenants may use the protections in the New Ordinance as an affirmative defense in any unlawful detainer action and any violation by an owner would be subject to administrative citations.
  13. The New Ordinance also would create a private right of action in court for residential tenants where landlords have 15 days to address any violations before tenants can exercise their right to go to court.
  14. Other restrictions mandated by the Original Ordinance are in effect and the provisions in the New Ordinance should be evaluated alongside such restrictions.

As you are aware, things are changing quickly and there is no clear-cut authority or bright line rules.  This is not an unequivocal statement of the law, but instead represents our best interpretation of where things currently stand.  This article does not address the potential impacts of the numerous other local, state and federal orders that have been issued in response to the COVID-19 pandemic, including, without limitation, potential liability should an employee become ill, requirements regarding family leave, sick pay and other issues.

Check out Sheppard Mullin’s Coronavirus Insights Portal which now aggregates the firm’s various COVID-19 blog posts on a broad range of topics. Click here to view and subscribe.

FOOTNOTES

[1] Please see here for previously published article on the Original Ordinance.