Tuesday, March 28, 2017

California Appeals Court Nixes SF Ordinance That Squeezes Landlords For Up To $50K In "Ransom" To Tenants When Booting Them In 'Going-Out-Of-Business', Ellis Act Evictions

In San Francisco, California, the San Francisco Chronicle reports:
  • When landlords decide to go out of the rental business, San Francisco can’t legally require them to pay their evicted tenants as much as $50,000 to cover the higher rents they’ll face on the open market, a state appeals court ruled Tuesday [March 21].

    A never-enforced 2015 ordinance that would have required the payments was “a form of ransom which interferes and places an undue burden on landlords who simply seek to go out of business,” said the First District Court of Appeal in San Francisco.

    The court said the ordinance, scaled down from a previous measure that was also overturned in court, violated property owners’ rights under a 1985 state law called the Ellis Act.

    That law, sponsored by the real estate industry, allows landlords to evict all their tenants when they leave the rental business, without having to show the usual legal grounds for eviction. Under a section of the law allowing local governments to require “reasonable” relocation assistance, courts have upheld a 2005 San Francisco ordinance that entitled displaced tenants to $4,500, adjusted annually for inflation.

    But the appeals court, upholding a Superior Court judge’s decision against the city, said the 2015 ordinance imposed a “prohibitive price” on owners who exercise their rights under the Ellis Act.

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