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By Anita Varghese
Staff Writer

September 27 -- City Council members modified Santa Monica’s law governing tenant harassment and clarified another law on permanent relocation benefits Tuesday in an effort to protect tenants facing eviction.

The City was required to amend its tenant harassment law after the California Supreme Court recently struck down one part of the local ordinance, ruling in Action Apartment Association vs. City of Santa Monica that specific phrases in the ordinance conflicts with state law.

An amendment to the ordinance now requires that a tenant first prevail in an unlawful detainer (eviction) action before a landlord could be liable for bringing a wrongful eviction action to recover possession of a rental unit.

Tenants who have successfully defended themselves against an eviction in which the landlord issued eviction notices in bad faith may sue their landlords for malicious prosecution.

Prior to the Court’s ruling, the ordinance allowed tenants or the City to sue landlords for malice while eviction cases were still pending.

“This section is an important one for the City,” said City Attorney Marsha Moutrie. “It provides a needed check on frivolous and malicious eviction actions at a time when landlords have a strong financial incentive to remove tenants who pay controlled rents.”

The Costa-Hawkins Act mandates statewide vacancy decontrol, which allows landlords to raise the rent to market rates when a unit is voluntarily vacated or the tenant is evicted for not paying rent.

In cities and communities where market rates outpace controlled rents, landlords see incentives to force tenants to move out, so that the units can be rented for newer and higher market rates.

City officials had noticed that some Santa Monica landlords were issuing tenants eviction notices in bad faith by, for example, telling a tenant that the owner would be moving into the unit when there was no plan for the owner to actually move in.

Moutrie believes the Court ruling is a victory for tenants because it preserves some of Santa Monica’s wrongful eviction penalties, when a previous lower court decision had struck all of them down.

Also, tenants who win their eviction cases can make stronger arguments if they choose to sue their landlords for malicious prosecution because tenants can tell the court that the landlord lost the eviction case.

“This Council has historically acknowledged the inherent disparity of power when a tenant finds herself or himself going to court by trying to write ordinances that fully protect the tenant,” said Council member Kevin McKeown.

“It is not an easy matter for us to pull back on such an ordinance, but we have a Court decision that forces us to amend the ordinance. We don’t have to remove the ordinance.”

In another action favorable to tenants, the Council clarified requirements of an existing permanent relocation benefits law without changing any part of the law.

Landlords must pay a flat fee to tenants who are forced to move because the owner wants to occupy the unit; empty the building under the Ellis Act, which allows the owners of rent controlled apartments to go out of the rental business, or tear the building down.

An automatic periodic increase goes into effect each year on July 1 based on inflation. This year, new fee amounts are:

• $5,300 for a single unit
• $6,650 for a one-bedroom
• $7,500 for a two-bedroom
• $9,300 for a three-bedroom
• $9,750 for four or more bedrooms

Each of these fees is increased by $1,500 if the displaced tenant is age 62 or older, disabled or has a child under age 18 and the tenant occupied the unit before November 17, 1999.

The date when landlords actually pay the fee has always been in Santa Monica’s municipal code, but recently there was some confusion about the law’s language.

“Periodic increases – which become effective on or before the date the tenant actually vacates a rental unit – would be payable to the tenant even when filings or proceedings related to the relocation predates the effective date of the increase,” Moutrie said.

If a landlord puts relocation funds into escrow, for example, and then the amount of benefits due to the tenant increases because of a periodic adjustment, the amount of relocation benefits the landlord has to pay is the amount in effect on the day the tenant vacates the unit.