Can I Say No to Pot in My Apartments When it is Legal in my State? – by John Triplett

With permission from AOA (Apartment Owners Association)

California just became the world’s largest legal marijuana market. When pot is legal in a state, what issues does this present to property managers and landlords of rental properties? Property managers are often confused and seeking to better understand how to handle the issues of legal marijuana and medical marijuana when it comes to tenants and rental housing in their states.

Laws are changing all the time in many states, just as California did on January 1, 2018, as voters approve different levels of permission when it comes to marijuana. This leaves property managers trying to figure out what should be in their leases around the issue.

You may be able to ban smoking, but do you really know what your tenants are eating or growing in their apartments? Do you really want to know if they are good paying tenants?

Rental Housing Journal did a recent interview with Seattle, Washington attorney Bret Sachter, an expert in tracking the progression and transformation of marijuana laws, to discuss some common questions property managers have about marijuana and tenants.

“I’ve been asked this a lot,” Sachter said, “but it does not come up as often as you might think. The overarching issue here is that, with few exceptions, people can do what they want to protect their property, even if the prohibited behavior is not illegal. You can prohibit smoking, prohibit pets, but with marijuana it’s much easier because it is federally illegal. So you can pretty much prohibit it if you want to no matter what, even medical marijuana,” Sachter said.

4 Questions About Pot, Tenants and Apartment Leases

Sachter says in terms of Fair Housing issues, and the U.S. Department of Housing and Urban Development (HUD) it is a situation where HUD wants it in the lease that marijuana is illegal but enforcement is another issue, he said. It is not so much that HUD wants landlords to evict over marijuana, but that you have something in the lease language that allows for eviction in the instance of marijuana use on the property. “So it is pretty clear as far as HUD is concerned,” he said. Here are his answers to four questions on pot and apartments.

1. 1.     Tenants With a Disability and Medical Marijuana

Question: If a tenant comes in and says I have a disability, here is a note from my doctor, I use medical marijuana, which is legal in this state, and I want to rent your apartment. Can a landlord prohibit that?

Answer: “A landlord can absolutely prohibit that because marijuana is illegal under federal law.” The landlord can say, “I understand our state allows medical marijuana but it is still a Schedule 1 drug and I prohibit it on my premises.”

1. 2.     Marijuana is Legal in My State – But What Does the Lease Say?

Question: What if a tenant says marijuana is legal and they should be allowed to use it?

Answer: “If your lease prohibits smoking and prohibits use of illegal drugs, then the legality of marijuana at the state level is irrelevant because under federal law marijuana is illegal. If your lease does not have those types of clauses, you should talk to an attorney in your state or city to find the best solution for your lease.” There is no law about reasonable accommodation for marijuana users, federal laws do not require it. As far as the federal government is concerned it is not ok.

“One thing I would say, and it is important, I would encourage landlords just to make everything clear,” in the leases, he said. “Clarify in a lease that you must abide by all laws both state and federal.” That is the case in residential. He said it can be different in commercial.

“But in residential it is not as tricky, and I am speaking very generally here,” Sachter said. “The states may have their own thing going on with legal marijuana laws, but it is still federally illegal. Make it crystal clear in your leases is my best advice,” he said. “How can you attract tenants in a state where it is legal yet protect the owners of the property? You cannot have it both ways.”

“I know in Seattle there are Airbnb bed and breakfasts that specifically market themselves accordingly, as part of marijuana tourism to come and stay in our place where it is legal.” But if a property manager doesn’t want that going on, then they have to be up front in the lease.

“If your tenant is Airbnbing to a tenant who is then using marijuana – well if you can’t catch them you cannot do anything about it. You have to prove they are doing this.  They are going to be using marijuana regardless of what the lease says.”

1. 3.     What if the Tenant Using Marijuana is a Well-Paying, Good Tenant?

“Landlords can certainly put a no-waiver clause in the lease. If I say, ‘Here is a list of prohibited things’ and if you do these prohibited things in the lease, you are subject to eviction,” he said.

“However, any time I waive any of these things does not constitute an overall waiver. It basically means you should not ever do it again,” he said. “Just because you get away with it once, does not mean you get away with it every time,” Sachter said.

1. 4.     Can I say ‘no pot in my apartment

“Usually if you say, ‘No pot in my apartment’ and you find a tenant using marijuana and you haul them into court, more than likely the judge is going to say, ‘Have you stopped?’ to the tenant and ‘Are you going to do it again?’ and the tenant is going to say ‘No.”  And then judge will say, ‘Ok, dismissed.”

To put a more legalistic term on it, usually a court will be in favor of “allowing the tenant to cure the defect,” rather than evict for most things like that, Sachter said.

Technically, in Washington, a landlord would serve a 10-Day notice to comply or vacate with the terms of the lease.  This process, therefore, gives the tenant a chance to “cure” the violation before the landlord can evict. Check your local state laws on this.

 

What One Experienced Property Manager Says About Pot

Sam Driver, Product Director for Buildium.com, and an experienced property manager, said as far as marijuana use in apartments, due to the newness of the legislation, the federal laws that supersede state and county laws, and liability concerns, it is not a topic that comes up a lot – yet.

“Generally, the safest solution is to choose the most conservative path-impose a no-smoking policy, which can in some cased cover outside areas, and a crime provision that includes local, state and federal laws. In many states, there are setbacks from doors, and it is particularly important if the building is a place of work which a multi-unit apartment building certainly is. So your lease should contain a provision explicitly banning smoking and illegal activity. Because the feds still outlaw it, this should be sufficient,” Driver said.

“This of course only covers the smoking angle. If a resident consumes it in another way, you’d likely never know,” he said.

 

Growing Marijuana Could Put a Power Load on Your Apartments

“As for growing, that’s less clear. But in general, unless the electrical system is designed for it, the loads grow lights put on the apartment unit could be excessive. I’d consider a reasonable use clause that specifies all high load equipment, including lights, air conditioners and any kind of pump be approved by you.

“This would put you in a position to take action if they are putting too much load, without specifically calling out the use of the equipment. Pumps are a good area for monitoring, because of the intermittent load, they trip breakers, and anyone who is using a hydroponic system would need several,” Driver said.

 

What if I Want to Market My Apartment to Marijuana Users?

“If, however, you wanted to roll the dice and market to this crowd assuming your state laws allow it, remember that the federal laws would cover any bank deposits from proceeds,” Driver said.

“In this case, you’d be able to do it, assuming no federal intervention, in compliance with local laws. No insurer would provide EO&E (errors and omissions excepted) insurance to you, and you wouldn’t be able to deposit any funds into a federally-accredited bank. So you’d have to self-insure, and run an entirely cash business, but you could do it, risking only federal enforcement.

“The big question is, ‘Would the premium rents be worth the risk of forfeiture?’ If you run afoul of the federal drug laws, the asset seizure possibility is a huge risk. You could lose the building.
“If you’re managing other owners’ properties, then you’d be risking their assets even if you used different leases, unless you kept fully separate books, bank accounts, and co-mingled nothing. So I’d say it would be all-or-nothing,” he said.

“The timing is tricky, too. Leases contain a provision that stipulates that the contract is in force in a specific jurisdiction. If they change the laws rendering your lease out of compliance, what happens during the remaining time of the lease? Is it invalidated? Or does the contract remain in force until it expires? “Good questions for your lawyer,” Driver said.

Rich Triplett is a writer for the RentalHousingJournal.com which is an interactive community of multifamliy investors, independent rental home owners, residential property management professionals and other rental housing and real estate professionals. It is the most comprehensive source for news and information for the rental housing industry. Their website features exclusive articles and blogs on real estate investing, apartment market trends, property management best practices, landlord tenant laws, apartment marketing, maintenance and more.  

Legal Corner

WRITTEN BY MICHAEL A BRENNAN, EVICTION ATTORNEY 

Question: I just received a phone call from one of my tenants asking me whether she can pay her rent for this month in two payments. I don’t like doing it, but she has been a great tenant over many years and this is the first time she has made such a request. While I want to help her, I don’t want to create any legal problems for myself. What are your thoughts on this situation?

Answer: Generally, I’m not a fan of allowing tenants to make partial payments, as it sets up expectations that you will do so in the future. However, in your case, the tenant has been there quite a while and actually took the time to notify you in advance that she is short on rent. Based on her responsible behavior (which seems to be more and more rare these days), you might decide to allow her to pay rent in payments. Before you make that decision, be sure to check your rental agreement for a “nonwaiver” provision which states your decision to accept rent in two payments does not waive your right to insist on the entire amount on its due date in the future.

Assuming your rental agreement has such a provision (most modern agreements do), you can allow her to pay rent in payments without worrying about waiving your rights. Additionally, avoid putting anything in writing indicating the payment is for any specific period. Instead, simply provide her with a receipt (if you provide receipts) indicating the payment is a “partial payment” for the entire amount owed with a “balance due” for the unpaid amount. You can either issue a three day notice at the time she makes the partial payment, with a promise you won’t file eviction until the day after the date on which she has agreed to pay the balance (provided she fails to do so) or you can wait to serve the three-day notice until after the date on which she agreed to pay.

Either way, you are able to accept the partial payment without creating legal problems for yourself, keep control over the situation, and keep the relationship intact by accommodating her needs this month.

Landlord to Pay $20,000 to Settle Pet Discrimination Case – by the Editors of Rental Housing Journal

Reprinted with permission from AOA.

The owner of several Reno, Nevada apartment complexes has agreed to pay $20,000 to settle allegations of  pet discrimination and Fair Housing Act violations involving requiring pet deposits from prospective tenants who require assistance animals, according to a release.The Silver State Fair Housing Council filed four complaints against the owner and manager of Silver Lake Apartments, Vale Townhomes, Oak Manor Apartments and Angel Street Apartments with the U.S. Department of Housing and Urban Development (HUD).  These complaints allege ERGS, Inc. and Silver Lake Apartments, LLC discriminated against prospective tenants who required assistance animals by requiring applicants who required support animals to pay a pet deposit fee.

Under the conciliation agreement, ERGS, Inc. will pay Silver State Fair Housing Council $20,500.  ERGS, Inc., and Silver Lake Apartments, LLC, will also adopt written policies that are consistent with the Fair Housing Act and provide fair housing training for all employees who interact with tenants or applicants. Kate Zook, executive director of the Silver State Fair Housing Council, told Rental Housing Journal that a woman with an emotional support animal had tried to apply at the apartments and was told they do not accept pets. The Silver State Fair Housing Council did follow-up testing on emotional support animals and rentals at the apartment complexes. She said they found, “People with emotional support animals were told they do not qualify as a service animal.”

The organization then filed the complaint against the owner and managers of the apartment complexes.

“I hate filing cases,” Zook said. But she said unfortunately sometimes it takes publicity about these issues to get people’s attention. “It is too bad. Somebody has been hurt in this.”

Both Fair Housing Act and Americans with Disabilities Act can apply in these situations.

In addition to the Fair Housing Act’s protections, HUD provided guidance in April 2013 reaffirming that housing providers must provide reasonable accommodations to people with disabilities who require assistance animals.  

Pet Discrimination and Disability

Disability is the most common basis of fair housing complaint filed with HUD and its partner agencies. Last year alone, HUD and its partners considered over 4,900 disability-related complaints, or more than 58 percent of all fair housing complaints that were filed.

HUD writes in the notice that, “An assistant animal is not a pet. It is an animal that works, provides assistance or performs tasks for the benefit of a person with a disability, or provides emotional support that alleviates one or more identified symptoms or effects of a person’s disability. Assistance animals perform many disability-related functions, including but not limited to, guiding individuals who are blind or have low vision, alerting individuals who are deaf or hard of hearing to sounds, providing protection or rescue assistance, pulling a wheelchair, fetching items, alerting persons to impending seizures, or providing emotional support to persons with disabilities who have a disability-related need for such support. For purposes of reasonable accommodation requests, neither the FHA nor Section 504 requires an assistance animal to be individually trained or certified.”

Housing providers are to evaluate a request for a reasonable accommodation to possess an assistance animal in a dwelling using the general principles applicable to all reasonable accommodation requests. After receiving such a request, the housing provider must consider the following:

• Does the person seeking to use and live with the animal have a disability — i.e., a physical or

mental impairment that substantially limits one or more major life activities?

• Does the person making the request have a disability-related need for an assistance animal?  In other words,

does the animal work, provide assistance, perform tasks or services for the benefit of a person with a disability,

• or provide emotional support that alleviates one or more of  the identified symptoms of a person’s existing disability?

If the answer to those two questions is “yes,” then the housing provider is to modify or provide an exception to a “no pets” policy.

RentalHousingJournal.com, an interactive community of multifamliy investors, independent rental home owners, residential property management professionals and other rental housing & real estate professionals, is the most comprehensive source for news and information for the rental housing industry. This website features exclusive articles and blogs on real estate investing, apartment market trends, property management best practices, landlord tenant laws, apartment marketing, maintenance and more.  Reprinted with permission.

Don’t Let Your Estate Plan Be a Hazard for Your Family! – by Kenneth Ziskin, Attorney

Reprinted with permission from AOA.

My wife, Hinda, who helps me with planning for clients, and I  have been lucky enough to meet hundreds of wonderful apartment owners though the AOA seminars we have done throughout California.  The majority of them planned ahead years ago and build living trust based estate plans to protect their families.

Unfortunately, almost all the plans we reviewed (some just a few years old, and some decades old) have now become “HAZARDOUS TO FAMILY WEALTH.”

Many of these “hazards” result from changes in the tax environment which were not anticipated when plans were originally drafted.  Others result from changes in the family.  Many others just reflect the growth in family wealth, which is a “good problem” to have.  And, a few of the “hazards” are the result of “one size fits all” drafting which, without customized planning, rarely optimizes for “your” goals and unique situation.

The vast majority of our apartment owner clients had a net worth of only a few hundred thousand dollars when they started out.  So, it was hard for them to justify the cost of doing good planning and their main goal was probate avoidance.

However, today, the vast majority have built multi-million dollar portfolios, which DO justify the cost of careful, customized planning.

Changes in the Tax Environment

Most of the old (and, sometimes, not so old) plans we review for apartment owners focused on avoiding probate and making sure that estate tax exemptions were optimized.

But, major changes in estate/death taxes, income taxes and the effect of property taxes have now made it more important for most owners to focus on the income and property tax consequences of their estate plans.

• First, the lifetime exemption (now, an exclusion) from estate and gift taxes grew from $600,000 in 1997 to $5.49 MILLION in 2017!  That means a married couple can now pass nearly $11 million to their heirs free of estate taxes.
• Second, the estate and gift tax rate on wealth over the exemption actually fell from 55% to 40%.
• Third, one spouse was finally allowed to leave his or her exemption to the other spouse (we all this “Portability”).
• Fourth, the top Federal income tax rates rose from 35% in 2003 to 43.4% in Obama’s second term (including the “Net Investment Income Tax”).
• Fifth, adding insult to injury, California increased its top rate from 9.3% to 13.3%.
• Sixth, while property tax exemptions under Prop 13 did not change much, massive inflation in income property values made it important to preserve and maximize your ability to prevent reassessment when you die.

Combining all of these factors meant that most apartment owners, even after inflation, no longer needed to worry about estate and gift taxes.  Those who did need to worry (we think this is about 25-30% of our owner clients) faced less estate and gift tax exposure, both due to the increased exclusion from tax, and the reduced rates. 

Changes in the Family

Many old plans were written when owners’ children were still in school, or had not yet built their own families.  So, they gave little thought to how wealth should be left to maximize benefits for adult children and for grandchildren. Rarely was any effort made to protect the inheritance for generations from creditors and predators (i.e., potential ex-spouses!).  

Changes in Wealth

Very few old estate plans anticipated leaving as much wealth as our clients now expect to have.  In many cases, the amount of wealth could now, if not properly handled, change the life of heirs in a negative way, destroying incentives and motivations for heirs.

Lack of Customized Planning

Good estate plans need to be customized to meet your goals.  That requires your estate planning lawyer to help you understand your planning options, tease out your goals and desires, help you make important planning decisions and then take the time to draft customized documents to get results you want for your family.

Very few lawyers have the experience to do this while focusing on the special needs of California apartment owners.  Furthermore, even those who have the experience often price their services at a level that discourages them from spending the time with clients that is needed to do really good planning and draft custom documents.

However, given the larger estates that apartment owners now have or expect to have at life expectancy, good planning is now much more important than ever before.  Now, larger estate sizes, the benefits of good planning more than justify the cost.

Most Common “Hazards”

While we do see some well written trusts, most of the time we see some combination of the following hazardous features (as well as others which appear less often) in trusts and related estate plans that we review.

• Trusts for married couples that mandate funding of a credit shelter, bypass, exemption or “B” trust.  This then prevents getting a second increase in income tax basis when the surviving spouse passes, and can cost millions in unnecessary capital gains taxes for your heirs.  With “portability” of your estate tax exclusion between spouses, this “old style” planning is no longer necessary to save estate taxes for most couples.
• Failure to properly document that jointly owned property, (even in the trust) as community property so that both halves get a new, higher income tax basis when either spouse dies.
• Failure to structure the trust so that the property tax exemption of the first spouse to die can be passed to children after the second spouse’s death.
• Failure to structure property ownership in the trust to avoid reassessment even when the first spouse dies.
• Failure to protect assets left for a surviving spouse from creditors.
• Failure to protect the surviving spouse from undue influence that can redirect property away from your natural heirs.
• Use of LLCs or partnerships to hold buildings in ways that cause unnecessary increases in property taxes on the first or second death.
• Failure to provide enough flexibility in your trust regarding allocations of income and principal which can, in turn, lead to higher income taxes after your demise.

Sound Estate Planning Is Also About Opportunities to Better Benefit Your Heirs

We get great pleasure when we can help clients articulate not just what they will leave to heirs, but howthey will leave it in order to enhance the lives of their heirs.

In some cases, that means combining protection from creditors and predators, with provisions that will prevent heirs from misusing their inheritance before they develop enough maturity to manage it themselves.  None of our clients want their children or grandchildren to be “spoiled” by their inheritance, or to dissipate a substantial inheritance early in life and wind up impoverished in later years.

This almost always requires a lot of discussion with property owners about their goals and family.  Then, we teach them about some of the ways they can fulfill such goals.  Finally, we spend significant time doing custom drafting to reflect the decisions the owners made.  And, we follow that up with explanations of the drafting to make sure it reflects the owners’ desires.

Sometimes this includes provisions to encourage or mandate keeping some or all of the family real estate business together, either for a period of time or permanently.

It can also include provisions that help pass values about hard work, accomplishment, thrift or even community service to your heirs.

The fact is, the opportunities to benefit your heirs, protect them and pass values are only limited by your imagination.  We get great satisfaction from educating our owner clients about strategies that have worked for other clients (or not worked) in order to help them think about their planning choices 

Opportunities to Enhance Benefits During Your Life

Although most estate planning revolves around benefits for your heirs, it also provides strategies to help you live a better life yourself. This can include strategies to enable you to sell property without paying capital gains taxes.  One of those strategies is the Capital Gains Bypass Trust (“CGBT”).  We wrote about CGBTs in the July, 2016 issue.

For most owners, with properties valued at currently low cap rates, a CGBT can avoid current taxes on the sale of appreciated buildings (some of which can otherwise face income taxes of nearly 40%).  If can also substantially INCREASE currently spendable cash flow, obtain income tax deductions that can offset gains or income from other properties and give substantial financial and non-financial benefits to your heirs.

Just as important to many clients, the CGBT can enable them to get rid of the burdens of property management.

The upcoming seminar in Torrance will explore the CGBT strategy in greater detail, and include new material on how to use it even for properties that are encumbered with debt.  The seminar will include case studies to help pique your interest and understanding.

Make Your Estate Plan Work Well for Your Family

Making your estate plan work well begins with understanding the planning you have and your planning opportunities.  Generally, this should begin with having an experienced estate planning attorney who understands, and works regularly with, the problems and opportunities of apartment owners.

But the real key is good planning.  That is why my motto is: “If you fail to plan (well), plan to fail”.

The tax environment, your wealth, and your family have probably changed a great deal since you completed your planning.  The odds are high that your existing plan does not reflect your current goals for your wealth, nor does it avoid tax risks that changes in the law and your situation have produced.

In order to prevent your estate plan from being a HAZARD to you and your family, get your estate planning reviewed now by a lawyer who will help you articulate your goals, and then put your goals first in any planning you want done.  You will get peace of mind, and your heirs will gain substantial benefits.

To learn more, register to attend Ken Ziskin’s seminar on “Estate Planning for Apartment Owners”: 

• Tuesday, September 12, 10 AM, Torrance Holiday Inn, 19800 S Vermont Ave, and
• Wednesday, September 13, 10 AM at AOA’s main office, 6445 Sepulveda Blvd. in Van Nuys. 

These seminars will include coverage of the Trump proposals to change income taxes on apartment owners. Ken also offers FREE CONSULTATIONS FOR AOA MEMBERS. To register for one of these seminars, call (800) 827-4262 today! 

Kenneth Ziskin, an estate planning attorney, focuses on integrated estate planning for apartment owners to save income, property, gift and estate taxes.  He holds the coveted AV Preeminent peer reviewed rating for Ethical Standards and Legal Ability from Martindale-Hubbell, a perfect 10 out of 10 rating from legal website AVVO.Com, and is multiple winner of AVVO’s Client Choice Award. .  See Ken’s website at www.ZiskinLaw.com or call (818) 988-0949.  This article is general in nature and not intended as advice for clients.  Please get advice from counsel you retain for your own planning.

Los Angeles City Rent Stabilization – Reminders and Updates – by Patricia A. Harris

Hopefully, if you own apartments in the City of Los Angeles and are under the L.A. Rent Stabilization Ordinance, you have already paid your building’s registration fees of $24.51 per unit which was due by February 29, 2017.  Serving a timely notice, you may collect one half of those fees from your tenants.  Note:  You used to collect this fee in the month of June, but for 2017, it has been changed to August. 

Collect $12.25 Registration Fees in AUGUST

The Los Angeles Rent Stabilization Division allows owners to pass-through one half of these fees ($12.25) with a 30-day notice, collectible in the month of August only.  That means you MUST serve the notice of the one time annual rent increase (found on the following page) in the month of July in order to collect this annual fee from your tenants.  AOA recommends you serve the notice on July 1^st to collect this fee along with the rent due on August 1^st.

IMPORTANT NOTE:  The notice of the one-time annual charge must be accompanied with a copy of your Rent Stabilization registration certificate to show that you paid the fees.

Code-Enforcement Pass-Through Fees

The SCEP fee of $43.32 per unit charge for the Housing Department’s code-enforcement inspection fee may also be passed through to your tenants.  This fee, however, must be amortized over a 12 month period and is collectible at a monthly rate of $3.61.  A 30-Day Notice of Change of Terms of Tenancy must be served to each tenant after you pay your bill before you can collect this fee.  That means with proper service, you can legally raise your rents (as long as you paid your bill!), $3.61 per month. Every little bit helps!  Your tenant may elect to pay this fee all at once, however they will not be awarded a refund should they move before the end of the year.  Also, if your building IS NOT under rent control, you may request and collect the fee in its entirety after serving the 30 day notice.

Other Los Angeles Rent Stabilization Updates

• SECURITY DEPOSIT INTEREST:  Please note that the required 2017 interest that must be paid on security deposits for units in L.A. City is 0.12 percent. A landlord may pay tenants the actual rate of interest earned if security deposits are kept in a separate account by providing a copy of the bank statement showing the actual interest rate earned for the year.

• ALLOWABLE ANNUAL RENT INCREASE:  The Los Angeles Rent Control’s annual rent increase is currently 3% through June 30, 2017.  As of this printing, the July 2017 rental increase percent was not yet determined but we were told it will most likely remain the same.  The actual amount should be made available to us in June. 

Via https://www.aoausa.com/

New Landlord Requirements Regarding Bed Bugs – by Patricia A. Harris

AB551 prescribes the duties of landlords and tenants with regard to the treatment and control of bed bugs.  The below describes in general, a landlord’s responsibilities.

What Must a Landlord Do?

• On and after July 1, 2017, prior to creating a new tenancy for a dwelling unit, a landlord shall provide a written bedbug notice to the prospective tenant. [Note: Tenant acknowledgement of this notice is now included in the revised AOA Rental Agreements – please download and use the new rental agreements for new tenancies.]

• This same notice shall be provided to all other tenants by January 1, 2018.

• The notice shall be in at least 10-point type and shall include, but is not limited to, the following: General information about bed bug identification, behavior and biology, the importance of cooperation for prevention and treatment, and the importance of and for prompt written reporting of suspected infestations to the landlord. (AOA Members may download the form “Information About Bedbugs” for FREE in the forms alphabetical listings at www.aoausa.com.)

• The landlord shall notify the tenants of those units inspected by the pest control operator pursuant to Section 1954.604 of the pest control operator’s findings. The notification shall be in writing and made within two business days of receipt of the pest control operator’s findings. For confirmed infestations in common areas, all tenants shall be provided notice of the pest control operator’s findings.

• Entry to inspect a tenant’s dwelling unit shall comply with Section 1954(2) – (to make necessary or agreed repairs …) with a 24-hour notice to enter the premises. Entry to inspect any unit selected by the pest control operator and to conduct follow-up inspections of surrounding units until bed bugs are eliminated is a necessary service for the purpose of Section 1954. Tenants shall cooperate with the inspection to facilitate the detection and treatment of bed bugs, including providing requested information that is necessary to facilitate the detection and treatment of bed bugs to the pest control operator.

• A landlord shall not show, rent, or lease to a prospective tenant any vacant dwelling unit that the landlord knows has a current bed bug infestation.

For more information, visit http://leginfo.legislature.ca.gov/faces/billCompareClient.xhtml?bill_id=201520160AB551

Via https://www.aoausa.com

7 Action Steps Apartment Owners and Managers Need to Do to Prepare and Get Ready for an Unlawful Detainer Trial

INTRODUCTION

Many landlords/ property managers have been involved in unlawful detainer/ eviction cases in one form or another.   Eviction cases take many forms and factual circumstances.   Some cases go smoother than others !    Some of the most common scenarios are either a tenant was not paying rent on time, or a tenant is being a problem and a nuisance and is disturbing the quiet enjoyment of neighbors in the apartment building.

When unlawful detainer cases are filed, under state law, they receive “trial setting” priority in the courthouse- usually are set quickly within 21 days after a Memorandum to Set for trial is filed by the plaintiff landlord in Court.    If your property is in a rent control jurisdiction like the City of Los Angeles, the grounds for unlawful detainer are set forth in the local rent stabilization ordinance, which is part of the municipal code.     If your property is not in a rent control city- lucky you !  You have more flexibility in terms of serving a notice to terminate the tenancy, although you must comply with state law notice requirements, case law, and the local rules of court.

To get you through the process of being a party in an unlawful detainer action with a level of comfort and confidence, there are a few things that you should do to prepare for the unlawful detainer trial so you are organized and mentally prepared for the process and the trial.  Here is a useful checklist to review with your attorney:

 

1. REVIEW THE COMPLAINT AND ANSWER:   Review the complaint, summons, and defendant’s answer, and all the exhibits. Does your complaint need amending ?    The tenant’s answer sets forth affirmative defenses that the tenant may try to argue at trial to win the case.    Make a list of what facts and exhibits you can present to counter and defeat the tenant’s affirmative defenses.

 

2. REVIEW THE EXHIBITS:    Review your Notice to Terminate the tenancy, the proof of service of the Notice to Terminate the tenancy, the rental agreement,  rental payment history, and the calculations to determine how much rent, daily damages, and costs is due on the date of trial.   It is a good practice to bring to court as an exhibit your business license, and proof of registration with the local city housing department if you are in a rent control city because a tenant may argue as a defense that you are not registered with these agencies.  If you are running your business as a corporation or LLC, you should confirm that your entity is in good standing with the Secretary of State.  Your attorney should bring a sufficient amount of exhibit copies to court.  

 

3. WITNESSES SHOULD BE READY TO TESTIFY:    Compile a witness list, and have your attorney serve subpoenas if necessary to third party witnesses.  Review the case and the complaint with your attorney and primary trial witness.     If you are involved in an unlawful detainer situation where the tenant is alleged to be a nuisance- you should serve trial subpoenas to any neighbors who will testify in your favor to help prove the nuisance allegations.  You have the burden of proof.  If the tenant is contesting proper service of the notice to terminate the tenancy, please have your process server or the person who served the notice to terminate the tenancy appear in court as your witness to counter these allegations. 

 

4. JURY TRIAL:   Check to see if the tenant has posted jury fees, and filed a counter memorandum to request a jury trial.    If so, you should have your attorney prepare appropriate jury instructions and special verdict forms to bring to the trial so you are prepared for a jury trial.   If you have time, you may want to file a Motion for Summary Judgment against the tenant to try to get an early judgment, and avoid a jury trial.  

 

5. IS POSSESSION OF THE PREMISES AT “ISSUE” ?: The primary issue in an unlawful detainer case is possession of the property.  Before the trial date, check to see if the tenant has “caved in” and has vacated the premises.  Please check with your property manager or neighbors to confirm whether possession is at issue.    If possession is no longer at issue- then you may convert the case into a collection case if the tenant owes back rent and other charges,  and is collectable.

 

6. WHO WILL BE THE TRIAL JUDGE  ?:        On the day of trial you will have to face either a judge pro tem, a Court commissioner, or a fully credentialed  judge who will conduct your trial and will decide your case.    Certain judges or commissioners may have a bias that favor either tenants or landlords- you should discuss with your attorney whether you want be in front of a judge, commissioner, or a judge pro tem.   Ask your attorney whether your attorney has had a case with the proposed judge in the past, and what happened in that case.   You can also look up the judge or commissioner on line to see if there is any information on the person, and whether it is positive or negative.  If you want to have a fully credentialed judge try your case, then don’t agree to have a commission or judge pro tem hear the case- your case will be assigned to a judge.  You may have to wait in the hallway before a judge is available to hear your case !!

 

7. WORK OUT A SETTLEMENT WITH THE TENANT IF POSSIBLE:

At Court when all parties are present, before the trial is about to commence,  is the perfect time to negotiate a settlement, and enter into a written and signed stipulation for entry of judgment with the tenant.   Perhaps you may need to give the tenant a few extra days to move out or a small rent concession.  You should have a well drafted, specific, and clear stipulation and  agreement that applies to all parties and all issues.    Having a well drafted stipulation for judgment and settlement with a “drop dead date” to vacate the premises, that binds all tenants in the unit, and that allows for a sheriff’s lock out after a date certain is truly in your best interest.    If the tenant does not have an attorney, ask the judge to make sure the tenant understands all of the terms of the stipulation, and make sure that the tenant personally signs and dates the stipulation, and make sure the Judge signs it as well.  

CONCLUSION- Be Prepared and Confident

This seven point list is not an exhaustive list for preparing for your day in eviction court, but is just a starting point to get you ready for an unlawful detainer trial.  You should consult with your attorney on all issues, questions, procedures, and dealing with uncertainties.   If you follow the steps on this checklist you should have a level of comfort going into the trial. When you let a judge or jury decide your case, there is no guaranty of victory. Try to settle the case in writing with your tenant if you can. If there is any problem, you can request a continuance from the Court, but for most garden variety non payment of rent eviction cases, you should be able to complete your business in the first go around !!  

The author of this article, Nate Bernstein, Esq., is the Managing Counsel of LA Real Estate Law Group, and a member of the State Bar of California and his practice concentrates in the areas of complex real estate litigation, commercial litigation, employment law,  and bankruptcy matters. The contact number is (818) 383-5759, and email is natebernstein44@gmail.com.   Nate Bernstein is a 22 year veteran Los Angeles real estate and business attorney and trial lawyer.   Mr. Bernstein also has expertise on bankruptcy law, the federal bankruptcy court system, creditor’s rights and debtor’s bankruptcy options.    He previously served as Vice President and In House trial counsel at Fidelity Title Insurance Company, a Fortune 500 company, and in house counsel at Denley Investment Management Company.      Nate Bernstein created www.laquiettitleattorney.com, a leading educational resource on quiet title real estate litigation.     Nate Bernstein is a local expert on real estate law and economic trends in the real estate and leasing market, business law, bankruptcy law.    Nate has personally litigated more than 40 major real estate trials, and has settled more than 200 complex real estate and business cases.

By  Nate  Bernstein, Esq.   –  Managing  Counsel, LA Real Estate Law Group

Still the Biggest Pitfall of a Family Living Trust Lawsuit – By Dale Alberstone, Esq.

As I advised AOA members in this column five years ago, the biggest pitfall in any arbitration or litigation, including unlawful detainers, brought or defended by a family living trust is the failure of the pleadings to properly identify the trustees of the trust as parties to the proceeding.

In December 2011, the California Court of Appeal ruled that the proper party to a legal proceeding is not the trust, but rather the trustee of the trust.  Failure to name the trustee(s), instead of the trust, was then, and continues to be, fatal.

In a nutshell, the appellate court held in Portico Management Group v. Allan J. Harrison (202 C.A.4^th464) that even though an arbitration decision for an award of $1.6 million was the determination of the arbitrator and could not be overturned by the court, it was not judicially enforceable because the award was rendered only against the trust, rather than against the trustees of the trust.

Thus, Portico is not only important for its holding that an award of an arbitrator is a final adjudication that ordinarily may not be overruled by the court (a fact which is well known by trial attorneys), but also, that arbitrations and court actions must be prosecuted or defended by the trustees of a family trust in their representative capacities.

The court explained that the reason the trust itself cannot be a party is because it is not a legal “person” under California law.  Only trustees of the trust are “persons.”

Understanding a Family Trust

A family living trust is primarily a probate avoidance device, though it may also have important tax benefits for the heirs.

But a trust is not a legal entity.  Nor is it deemed to be a legal “person,” unlike a corporation which is a “person,” for purposes of suing in court.  A trust is not allowed to sue or to be sued.  It does not hold title to property.

Title is technically held by the trustees, even though real property and other assets are often but loosely said to be owned by the trust.  A trust is simply a collection of assets and liabilities, but is not the holder of title.

Unlawful detainer proceedings are common instances where the distinction between trustees and trusts is critical.  If the owner of an apartment building transfers his property into his family living trust, leases should thereafter be executed in the name of the trustee of the trust, not in the name of the trust itself.  Any eviction action must then be brought in the name of the landlord, as the trustee of the trust, rather than in the trust’s name.  In other words, the proper designation of the landlord plaintiff in an eviction lawsuit would be “John Smith, as Trustee of the John Smith Family Trust.”  The plaintiff cannot be the “John Smith Trust.”

Another example would be a case when an individual buyer of an apartment building sues the seller after the latter had previously transferred his property into his living trust.  Thus, Bob Buyer, who is suing for breach of contract, fraud, or to compel the seller to convey title to him, must sue the seller defendant as “Sam Seller, as Trustee of the Sam Seller Family Trust.”  Bob Buyer could not properly sue the “Sam Seller Trust.”

Returning to the Portico case, the arbitration proceedings were brought by Portico Management Group, LLC, against The Harrison Trust, rather than against Allan Harrison as the Trustee of the Trust.  Portico prevailed, whereupon an arbitration award was entered in Portico’s favor for over $1.6 million.  But the arbitration award was only against the trust, and not the individual trustees, because only the trust was a defendant in the proceeding.

Procedurally speaking, once an arbitration award is rendered, the prevailing party will petition the Superior Court to confirm the award by adopting it as a judgment.  But confirming an award (which courts routinely do) is different from a later enforcement of it.

In Portico, because the award (and subsequent judgment) was against the trust, rather than the trustee, the court had no power to enforce an arbitration award even if it wanted to.  Ouch!

The first lesson to be learned from the Portico case is that if you intend to sue a trust (whether in court or in an arbitration), be certain that the named defendants are the trustees of the trust, in their representative capacities, rather than the trust itself.

As an aside, the fundamental mistake in the Portico arbitration was not made by Portico itself.  The error was by its attorney.  Portico’s counsel failed to understand that a trust is not a legal entity and that only a trustee of the trust may be sued as a defendant.

The second lesson to be learned from Portico concerns the legal effect of an arbitration award.  Porticoillustrates the finality of an arbitrator’s award, but also exposes the pitfall that it might not be judicially enforceable.

Understanding the Finality and Enforceability of Arbitrations

For our purposes as members of the Apartment Owners Association, an arbitration is a non-judicial legal proceeding in which the parties agree to submit their disputes for decision by an independent neutral known as an arbitrator.  Usually, the arbitrator is a retired judge or seasoned attorney in the relevant field of law.

In almost all such arbitrations, the parties agree (generally in an underlying contract), that the decision of the arbitrator will be final, binding and non-appealable.

While finality may be the case, the subsequent enforceability of an arbitrator’s award is the exclusive domain of the judicial system.  For example, if the claimant obtains an award for money damages or a determination that the seller must convey his property to the buyer at the agreed upon contract price, only the court, not the arbitrator, has the power to enforce that award.

The method for that enforcement is for the prevailing party at the arbitration to petition the court to confirm the award and thereupon enter a judicial judgment in accordance with the award.  If the judgment is for money, the sheriff or other levying officer may compel payment by attachment and sale.  That liquidation may be of personal or real property, such as targeting the losing party’s bank account, his Mercedes, his apartment building, or his diamond studded solid gold Rolex watch.

If the judgment is for a specific performance, the court can compel the title to be transferred by ordering the seller to deliver a deed, or in the alternative, ordering that a copy of the judgment, authenticated by its clerk, be recorded with the county recorder.  (AOA lawyer members reading this column should review Blueberry v. Chow [230 C.A.4^th 1017] for the appointment of an elisor.)

On the other hand, an arbitrator has no legal power to enforce his own award.  In fact, with extremely limited exceptions, his power ends at the time he renders his final award.

Returning to the Portico case, the court noted that an exception to the finality of an arbitration award is that where the award is unenforceable due to a patent ambiguity, the arbitrator may have the power to thereafter clarify it.  Unfortunately, Portico (or more precisely, his attorney) did not timely seek a clarification from the arbitrator.

 

Concluding Remarks

There are several important lessons to be learned from the Portico case.

First, all arbitrations and lawsuits, including unlawful detainers, should be prosecuted or defended in the name of the trustees of the trust in their representative capacities, rather than by or against the trust itself.

Second, a court judgment against the trust itself will be ineffective to reach the assets held in trust because a trust cannot be a judgment debtor.  It is not a “person” under law.  Instead, the judgment must be against the trustees, which means that they should be named from the inception of the case as parties to it.

Third, while arbitration awards are generally final and non-appealable, they are not necessarily enforceable.  When agreeing to have any disputes resolved by arbitration, bear in mind that if the arbitrator reaches an unfair or erroneous determination, the court will not overturn it.  Indeed, the only grounds for the court to reject an arbitration award are (1) there was fraud, corruption or other impropriety by the arbitrator, (2) the arbitrator exceeded his powers, or (3) the arbitrator refused to allow material evidence to be presented during the proceedings.  But an arbitrator’s award against a trust which is named in the pleadings is not erroneous; it is just not enforceable in court.

Finally, bear in mind that leases and rental agreements should identify the lessor or landlord as the trustee of the trust, (if that is the case), rather than the trust itself.

Next month I will discuss all the important laws pertaining to the employment of resident managers in 2017.

BIOGRAPHY

    Dale Alberstone is a prominent litigation and transactional real estate attorney who has specialized in real property law for the past 40 years.  He has been appointed to periodically serve as a judge pro tem of the Los Angeles Superior Court and is a former arbitrator for the American Arbitration Association.  He also testifies as an expert witness for and against other attorneys who have been accused of legal malpractice.

            Mr. Alberstone has been awarded an AV rating from Martindale-Hubbell.  An AV rating reflects an attorney who has reached the heights of professional excellence and is recognized for the highest levels of skill and integrity. You may Google “Dale S. Alberstone” for further background.

            The foregoing article was authored on November 1, 2016.  It is intended as a general overview of the law and may not apply to the reader’s particular case.  Readers are cautioned to consult an advisor of their own selection with respect to any particular situation.

            Questions of a general nature are warmly invited.  Address correspondence to Dale S. Alberstone, Esq., ALBERSTONE & ALBERSTONE, 1900 Avenue of the Stars, Suite 650, Los Angeles, California 90067.  Phone:  (310) 277-7300.

Reprinted with permission of AOA (Apartment Owners Association, Inc.) and the author.

City is Sued for Attempting Unjustified Snooping on Rental Property – by Meriem Hubbard and Wencong Fa, Attorneys-at-Law

In a legal case that should interest rental property owners statewide, the City of Highland in San Bernardino County is being sued for trying to arm-twist landlords and tenants into allowing warrantless inspections of their homes.

In other words, the city is trying to coerce property owners and tenants into surrendering a fundamental constitutional protection: the Fourth Amendment’s guarantee that government officials cannot search private property unless they first obtain a warrant.

To be sure, the plaintiffs in this case –  property owner Karl Trautwein and the tenants in one of the homes he owns – have nothing at all to hide.  An investor with a number of homes around Southern California, Karl takes pride in maintaining all his properties to a high standard and keeping tenants satisfied.

What Karl and the tenants who are joining in the lawsuit resent is Highland’s attack on their fundamental privacy and property rights.

Indeed, in a sign of the importance of the case, they are represented by Sacramento-based Pacific Legal Foundation, the nation’s leading legal watchdog for property rights and individual liberty. Donor-supported PLF represents these plaintiffs free of charge, as with all its clients.

Karl and his tenants are victims of local government’s plan for a sweeping regime of unjustified rental-property inspections throughout the city – and its heavy-handed strategy for imposing this agenda on owners and renters.

Instead of simply responding where there have been complaints about code violations, the city adopted the goal of aggressively inspecting all 4,800 rentals within city limits, whether or not there have been complaints.

To cut corners in this overwhelming task, officials are attempting to evade the constitutional requirement to seek administrative warrants for inspections. Instead of going to a court and showing cause to receive permission to inspect inside a home, the city is attempting to bully property owners and tenants into allowing inspectors in without a warrant.

Karl and his tenants have been subjected to bullying because they would not agree to let inspectors into their home.  There have been no complaints about the property and the city has offered no evidence that it has any problems.  So Karl and his tenants object to a baseless, uncalled-for, open-ended intrusion by government bureaucrats.

City officials didn’t respond to this refusal by seeking a warrant – because there were no grounds for one.  Instead, the city resorted to threats and coercion.  Karl was charged a “re-inspection fee” and was told that his rental license would not be renewed if he continued to refuse to allow a warrantless entry.

This pressure tactic is what the law calls an “unconstitutional condition” — i.e., Karl’s rental license is being held hostage unless he agrees to the condition that he and his tenants waive their Fourth Amendment rights.  As the lawsuit points out, government cannot confront anyone with a false choice of this kind, which coerces them out of constitutional freedoms.

“With its crusade to inspect all rental properties, even those like mine without any tenant complaints, the city is wasting its resources and harassing law-abiding people,” said Karl.“Ironically, this is the kind of regulatory overkill that can reduce the supply of rental housing by causing conscientious and hard-working property owners to decide it’s not worth it.”

“There is no freedom without property rights and the privacy they protect,” he noted.  “Privacy means no one can come inside your residence unless you invite them in.  Cities have no business forcing their way into people’s homes.  The Constitution provides a way for government to enter a home — by convincing a judge to issue a warrant based on probable cause.  Highland wants to avoid the inconvenience of that constitutional requirement.”

“Violating the privacy rights of my residents without probable cause is as unnecessary as it is wrong,” he continued.  “The city should not be violating their privacy for no good reason, and it can’t be permitted to go snooping without a warrant.”

Filed in U.S. District Court for the Central District of California, the case is Trautwein v. City of Highland, et al.  More information, including the complaint, an explanatory blog post, a podcast, and a video statement, is available Pacific Legal Foundation’s website:  www.pacificlegal.org

Meriem Hubbard is a Principal Attorney with Pacific Legal Foundation and Wencong Fa is a Staff Attorney with the foundation.  They represent Karl Trautwein and his tenants in challenging Highland’s attempt to coerce them out of their Fourth Amendment rights. Donor-supported Pacific Legal Foundation www.pacificlegal.org is the leading watchdog organization that litigates for limited government, property rights, individual rights, and free enterprise, in courts nationwide. PLF represents all clients free of charge.  For more information, visit http://www.pacificlegal.org.

Reprinted with permission of AOA (Apartment Owners Association, Inc.) and the author.

Legal Analysis of Quiet Title Claims for Apartment Owners and Deed of Trust Holders – By Nate Bernstein, Esq.

Often times we get calls from clients or colleagues who ask us to explain what a “quiet title” action is.  There is no need to be quiet and hush hush about quiet title actions – pun intended!   In fact a quiet title claim is very common claim and cause of action asserted under California real estate law.      This article is an overview of the quiet title claim process for property owners and real estate deed of trust lenders who may have a perceived or real problem with their right, title, and interest to real property in California. 

Everyone should get a “title check up.”  It is in the best interest of all investment property owners and deed of trust lenders to periodically obtain a copy of a preliminary title report from a reputable title company-  you may find items in the title profile for the subject property that are objectionable, fraudulent, or mistakes- these matters should be cleared up.  It is healthy to get a title check up- it leads to good title karma!!

If you are in the real estate investment ownership or real estate lending business, you know that having clear, marketable title to real property is an important component to valuable real estate ownership.   If your title is not clear, or has chain gaps- you cannot sell, refinance, or otherwise leverage your asset.

Clouds on title may impact an owner’s ability to sell or refinance property, and can impact a lender’s rights for title priority and to foreclose on real property.    Clouds on title or mistakes on title can also impact an owner’s ability to evict a tenant – the tenant may claim invalid title as an affirmative defense to an unlawful detainer lawsuit – that is the last thing you want when you are trying to evict a tenant!!

The law provides a remedy for fixing title problems.  Quiet title lawsuits are an important vehicle for deciding real estate title disputes and deed of trust priority disputes under California law.

Legal Procedures for Quiet Title Claims

When you have a dispute as to the state of the title for a residential real property or commercial real property, or an unfriendly person or entity is making a legal or equitable claim against the title, you can file a “quiet title” lawsuit in the Superior Court where the property is located to resolve the claim.   This may be done directly by the party or by the party’s title insurance carrier after a claim is made with the title insurance carrier.   Title insurance companies often times get involved in prosecuting, defending, and settling quiet title actions on behalf of property owners and lenders.   Title insurance companies sell title insurance products to purchasers and lenders.      When a title insured client makes a claim, filing a quiet title action is often times the method to fix a title problem on real property short of paying off the client’s claim or investment.  The goal is to obtain title “as insured” under the title insurance policy.

The quiet title claim can also be brought in conjunction with other claims, such as fraud, a claim for cancellation of an instrument, declaratory relief, injunctive relief, or even equitable subrogation.    Each case is fact sensitive.   In a declaratory relief action, for example, the court has the power to determine the ownership rights of the parties as to an interest in real property as of a certain date.  An opponent can also file a countersuit, also called a “cross-complaint.”   Today you are the plaintiff, but tomorrow you may be the defendant!

As another example, in a quiet title lawsuit, you can also litigate a claim relating to a fraudulently executed or fraudulently recorded deed of trust mortgage document.  That is why it is a good idea to get a title check up to see what is in your title profile.

An action to quiet title is a lawsuit filed to establish ownership of real property (land and buildings affixed to land). The plaintiff in a quiet title action seeks a court order or judgment that prevents the defendant from making any subsequent or conflicting claim to the property.    Quiet title actions are necessary because real estate may change hands often, or there may be a conveyance of a partial interest, and it is not always easy to determine who has title to the property.

In the arena of quiet title litigation, the Court will determine the state of the title as of a particular date, and has the power to “clear title,” remove “the cloud on title,” or make an equitable decision, and, hopefully, resolve the dispute.   Title disputes can be adjudicated in an orderly manner without infighting between neighbors or shouting matches.   By law, in California, juries do not decide quiet title actions- these actions are decided by judges in bench trials.   Thus, there is no right to a jury trial for a quiet title action under California law.  Do you really want 12 jurors with no legal training deciding who owns your apartment building?

Applicable Laws

Under the laws of the most states in the United States, the law of quiet title is governed by state statutes and the case law authorities that interpret the state statutes.    Generally speaking, the law of quiet title in California is governed by California Code of Civil Procedure 760.010-760.060, and the case law interpreting these sections.      Also, underlying substantive laws, may apply as well- such as fraud, or breach of contract, the laws of recording and conveyances,  or the laws of probate.

When quiet title lawsuit is filed, the plaintiff is required to record a lis pendens at the County recorder’s office.    The term “lis pendens” is a Latin term for “action pending.”  The lis pendens provides notice in the title profile of a particular property that a lawsuit is pending, and that any subsequent grantee, subsequent purchaser, assignee, or lender, takes title subject to the claim.   Generally, a lender will not make a loan secured by a title that is subject to a “lis pendens” recording.  For the basic statutory procedural requirements for handling a lis pendens, please review California Code of Civil Procedure 405-405.24.

The quiet title action is important, if an owner or secured lender wants to determine that he or she has superior rights to the title of a particular parcel of real property in comparison to other claimants or potential claimants.  Secured real estate lenders often seek to establish title profile priority for its deed of trust by filing a quiet title action and adding a claim for declaratory relief.    Establishing a clear and marketable title is also crucial for receiving future financing, or for making a marketable future transfer by deed, trust, or will.     It is also an important foundation to have clear title if you start an eviction lawsuit- also known as an unlawful detainer action.   If title is not clear, how can the person complete an eviction with confidence?     Possession follows rights to clear title!

Quiet Title Actions are “Fact Specific” –  

Most Actions Settle But Some Proceed to Trial 

In reality, most quiet title lawsuits and related claims are settled after the case is filed and prior to trial.   Cases sometimes settle in mediation, at a settlement conference, or through professional communication and compromise between the parties and their attorneys.   If quiet title cases don’t settle “out of court,” these claims are decided by judges in bench trials every day.  So you need to be prepared to try your case if the case does not settle.

Other times, when the defendant fails to defend the action, a default is filed and the plaintiff has to prove up the default with live testimony in Court.   Because of the intricacies of the court process, parties should retain experienced counsel to represent their interests in a quiet title action.

This article is a capsule overview, and each quiet title claim should be treated specifically to address the specific facts and circumstances of the situation.   Questions should be directed to Los Angeles Real Estate Law Group at (818) 383-5759.  

Nate Bernstein, Esq., is the Managing Counsel of LA Real Estate Law Group, and a member of the State Bar of California and his practice concentrates in the areas of complex real estate litigation, commercial litigation, employment law, and bankruptcy matters.  He is a 22 year veteran Los Angeles real estate and business attorney and trial lawyer.   Mr. Bernstein also has expertise on bankruptcy law, the federal bankruptcy court system, creditor’s rights and debtor’s bankruptcy options and created www.laquiettitleattorney.com a leading educational resource on quiet title real estate litigation.   For more information, call (818) 383-5759, or email natebernstein44@gmail.com

Reprinted with permission of AOA (Apartment Owners Association, Inc.) and the author.