OPTIONS FOR COMMERCIAL LANDLORDS DURING PANDEMIC

Aug 31

The unprecedented COVID-19 pandemic has resulted in the implementation of a number of ordinances at the state, county, and city levels that have greatly impacted a landlord’s ability to enforce a tenant’s obligations under a lease. Many landlords feel trapped: they are stuck with a non-performing tenant while still obligated, themselves, to make their mortgage, tax, and insurance payments. Fortunately, there is hope.

On August 13, 2020, the Judicial Council of California (which is the body representing California State Courts) voted to allow previously enacted emergency rules, including one halting evictions, to expire on September 1, 2020. The implications from this is that starting September 2, 2020, landlords should be able to commence eviction proceedings. But will evictions go forward? Unfortunately, the vote does not impact City and County moratoriums many of which remain in place.

Given this uncertainty, what can a landlord possibly do to protect its interests? It may be prudent for a landlord to have a frank discussion with its tenant to determine whether the tenant would even like to continue the landlord tenant relationship or whether the parties are better off pursuing a termination of the lease. Alternatively, a landlord and tenant may want to consider amending the lease to account for these turbulent times. In either circumstance, it is important for the landlord to consult with an attorney to ensure any agreement is properly documented and that the landlord’s interests are adequately protected.

In the event a landlord and tenant cannot resolve their dispute amicably, litigation may become necessary. The various ordinances and moratoria do not necessarily foreclose a landlord’s interest to pursue a tenant in court. It is important to identify ordinances pertinent to the property. For example, a number of ordinances require a tenant to follow a strict process in the event that it is unable to make a payment due to financial impacts of COVID-19. If that process is not followed, a landlord’s options related to issuance of notices and filing of eviction actions expand. A landlord may also be in a position to issue a notice pursuant to the lease for nonpayment of rent, which may allow the landlord to eventually terminate the lease. Further, most ordinances apply only to non payment of rent defaults. Should a tenant’s actions breach the lease in some other manner, particularly if the conduct jeopardizes the public health and safety, a court may be inclined to allow an eviction action to proceed. Even if a landlord cannot evict a tenant, it may want to pursue an action for breach of the lease, particularly in circumstances where a landlord believes that a tenant has strategically defaulted in refusing to pay under the auspices of COVID-19 despite having the financial resources to do so.

Whether it becomes necessary to negotiate with a tenant, document a new or amended lease agreement or termination, or pursue an enforcement of a landlord’s rights through litigation, the attorneys at the Blake Law Firm are here to assist landlords in navigating the constantly changing landscape of landlord/tenant disputes in the COVID-19 era.

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Andrew Hall

Attorney Andrew Hall has over 10 years of experience handling complex real estate, business, and litigation matters throughout California and Washington. Andrew has vast experience with a wide range of clients – from residential to commercial property owners, landlords to tenants, real estate agents to brokers, title to escrow companies, hard money lenders to banking institutions. Andrew has handled cases ranging from administrative disputes, to unlawful detainers, to bankruptcies, to litigation, leaving his clients with the confidence that he can handle all of their needs from soup to nuts.

Andrew is committed to exploring efficient and cost-effective resolutions for his clients, whether that be through informal conversations with parties or attorneys, mediations, or settlement conferences. However, when litigation is inevitable, Andrew has counseled his clients through all stages of a dispute, including arbitrations, court trials, jury trials, and appeals at both the State and Federal Court levels.

Andrew resides in Carlsbad with his wife Lauren, son Nolan (7), and daughter Madeline (5). Andrew is actively involved with the Magdalena Ecke Family YMCA, where he can often be found on the weekends cheering Madeline on in any variety of youth sports or with Nolan participating in the Y’s Adventure Guides Program. Andrew enjoys playing golf, tennis, softball and good barbeque.

Andrew is committed to identifying his client’s goals and employing his big firm experience with small firm attention to help his clients achieve those goals.