Update: U.S. Senate “CARES” Act passes Senate. The CARES Act includes eviction ban for all properties with federally backed mortgages.
Both the City of Sacramento and the County of Sacramento have enacted temporary bans on evictions that are the result of the Coronavirus. Tenants and landlords should pay close attention to these requirements.
The Sacramento County ban on evictions, is very similar to the City’s ban. In some respects, the bans are moot as many local courts have simply closed their unlawful detainer (U.D.) departments. The City of Sacramento ordinance contains the following key elements.
Key Elements of Sacramento’s Ban on Eviction
- No landlord shall endeavor to evict a tenant for nonpayment of rent if the tenant, in accordance with this subsection D, demonstrates that the inability to pay rent is due to the Coronavirus Disease 2019 (COVID-19), the state of emergency regarding COVID-19, or following government-recommended COVID- 19 precautions.
- As used in this subsection D, “covered reason for delayed payment” means a tenant’s loss of income due to any of the following: (a) tenant was sick with COVID-19 or caring for a household or family member who is sick with COVID-19; (b) tenant experienced a lay-off, loss of hours, or other income reduction resulting from COVID-19 or the state of emergency; (c) tenant’s compliance with a recommendation from a government agency to stay home, self-quarantine, or avoid congregating with others during the state of emergency; and (d) tenant’s need to miss work to care for a home-bound school-age child.
- Tenants who were afforded eviction protection under Sacramento City Code section 5.156.090.D shall have up to 120 days after the County of Sacramento proclaims the termination of the local public health emergency declared by the Sacramento County Public Health Officer on March 5, 2020, to pay their landlord all unpaid rent. During that 120-day period, the protections against eviction found in Sacramento City Code section 5.156.090.D apply for such tenants
To take advantage of the protections, tenants must do all of the following.
- Notify the landlord in writing before the day rent is due that the tenant has a covered reason for delayed payment.
- Provide the landlord with verifiable documentation to support the assertion of a covered reason for delayed payment. This documentation might include pay stubs, or employer statements. In addition, this documentation doesn’t need to be provided with the initial notification. However, it would presumably need to be provided before the rent is due.
- Pay the portion of rent that the tenant is able to pay. Per the City’s own press release, “if the tenant owes $1,500 in rent and the tenant suffered a $500 wage loss in March, the tenant would pay the landlord $1,000 for April rent”.
Key Take Aways
Burden of proof is on the tenant
The burden is on the tenant to notify the landlord in writing, before the rent is due, and provide the landlord with verifiable documentations to support the assertion, and to pay the portion of the rent that the tenant is “able to pay.” So if the tenant fails to notify the landlord before the rent is due, the law would not apply.
Tenant must provide verifiable documentation
Similarly, if the tenant failed to provide the documentation. Additionally, this is to protect tenants who sustain a loss of income. If the tenant still has enough money in the bank despite the loss of income, such that the tenant is “able to pay” the full amount of the rent, the tenant cannot seek relief under this law. However, practically speaking, so long as the court unlawful detainer departments are closed, eviction is still not in the cards.
120 Days after Moratorium for Repayment
In any event, the tenants must pay the arrearages within 120 days after the state of emergency is lifted. Depending on how long the state of emergency lasts, and how many months the tenant pays no rent, this could be nigh impossible for many tenants to achieve. If that is the situation, I would expect the City will amend the law to give the tenants more time to repay.
The law is silent as to how quickly the tenant must repay during the 120 days and as written, the tenant is not required to make monthly payments during the 120 days, or make any partial payments, before the 120th day.
The law does not include any provision for the payment of interest, but arguably contractual pre-judgment interest would be recoverable, as would reasonable late fees.
Notes for Tenants
Tenants should not assume that this is free rent. You are still responsible for making up your missed payment amounts. Tenants should seek payment arrangements with their landlords and be faithful in meeting those obligations. Should tenants not make their payments, they would presumably be subject to eviction as well as late fees 120 days after the moratorium is lifted.
Notes for Landlords
Although it is undoubtedly self-evident, collecting deferred rents may well never happen. It is in your best interest to maximize rents that a tenant can “afford to pay” each month. Collecting missed payments will likely require eviction court and the need to collect a judgement against the tenant.
Additionally, it would be wise to walk very carefully around this issue and seek legal advice. I know some landlords serve their own three day pay or quit notices. However, for the foreseeable future, landlords should use their attorney for the entire process. Landlords who pursue eviction for COVID-19 related issues are subject to a $25,000 fine.
What if Tenant was Already Late?
This ordinance does not apply if a tenant was already in arrears or in violation of their lease agreement. Per the City of Sacramento, “The ordinance does not prevent a landlord from evicting a tenant who failed to pay rent when due before the ordinance was adopted or for any other lease violation”. But as mentioned above, you will have to wait for the U.D. courts to reopen.
This article is not mean for legal advice. This is strictly an opinion page. Readers should seek their own legal counsel.