Reversing a lower court decision, California’s First District Court of Appeal has ruled that minors living in a rental unit with a guardian are “occupants” but not “tenants,” an important distinction with respect to how San Francisco’s Rent Ordinance is written and the calculation of relocation payments due when tenants are removed by way of an Ellis Act eviction.

While San Francisco’s Rent Ordinance requires landlords to pay a relocation fee of $6,286.03 per “tenant” displaced by a no-fault eviction, which had been interpreted to include every legal occupant of a rental unit, the Court of Appeal has ruled that an occupant who does not have the right to exclusive possession and an obligation to pay rent is not a “tenant” and that only “tenants” are entitled to receive relocation payments as defined by the ordinance.

That being said, in their ruling on the case of Danger Panda, LLC v. Launiu, the court added: “We emphasize that the question before us is not whether the San Francisco Board of Supervisors has the authority under the Ellis Act to confer a…relocation benefit on a child. Rather, we hold only that a minor is not a tenant entitled to a separate relocation payment under Rent Ordinance, section 37.9A(e), as currently written.” The added emphasis is ours.

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Comments from “Plugged-In” Readers

  1. Posted by Government Shrinkage

    Next up: are pets tenants?

  2. Posted by bachman_erlich_overdrive

    Next up: More informal, difficult to prove discrimination against rental applicants with children once the law is re-written.

  3. Posted by Elitist Pig

    More importantly, I’d like to hear more about Danger Panda, LLC.

    • Posted by Three-Fifths Compromise

      Rats, there doesn’t appear to be any connection between Danger Panda, LLC & Carlos Danger. I’ll see if the CA Secretary of State is any help.

      • Posted by Elitist Pig

        If there were, this story would be 1000 times more interesting. Looks like Danger Panda, LLC is just a husband and wife house flipping team. Not what I had hoped.

  4. Posted by Bay Guy

    Do Mothers-in-law count? Just trying to be funny! 🙂

    • Posted by Anon123

      Yes, funny – but the way it reads they are only tenants if they are on the lease – if they just moved in at some point they are occupants… right?

  5. Posted by anon

    I don’t get this one. Landlords spent at least $100,000 taking this one to the court of appeal, and delayed their eviction process by 3 years. All to save a $650 relocation payment. And there is no broader principle established as the BOS will quickly amend the ordinance to clarify that kids are entitled to Ellis relocation payments. Bizarre. Tenants were the big winners (even though they lost the appeal) by getting to stay in their super cheap place an extra three years, and they even cashed the checks they did receive from the landlord. Although they will now have to vacate.

    • Posted by Elitist Pig

      Not sure how active Danger Panda is, but if BOS doesn’t make an amendment and they Ellis Act families with about (16) children they will have saved their $100K investment.

    • Posted by that_dude

      Perhaps the landlord did it out of principle and not cash? Could those/us soul less creatures possibly have principles?

      • Posted by anon

        I could understand that. But there is no real principle established here because the BOS can (and will) so easily change the ordinance to include kids in the definition of tenants. So ultimately all this will accomplish is to take away an argument that landlords could use while this issue was unresolved in negotiating with tenants who have kids.

        If by principle, you mean “I’m going to fight this in a way so that my tenants get to stay in my property and pay way below market rents for 3 additional years, saving them tens of thousands of dollars, so I can avoid them paying $650” then I guess that is an odd principle.

        • Posted by anon2

          In fact it’s already defined that way for other types of no-fault evictions:

          “2) Eligible Tenant. For purposes of this section 37.9C, an Eligible Tenant shall mean any authorized occupant of a rental unit, regardless of age, who has resided in the unit for 12 or more months.”

          So I agree that this seems a pointless waste of their money and the court’s time. It should also be mentioned that there is a cap on relocation payments per unit.

        • Posted by Anon123

          $6,286 per tenant

    • Posted by Keepitup

      Someone correct me if I have it wrong. I believe the tenant has to pay all attorney and court cost due to losing the case. And one would think if the landlord paid all the “tenants” relocation extortion fees then those minors without a lease will be forced to pay the fees back to the landlord. Am I missing something?

      As for amending the ordinance. Without a lease or “contract between the parties” how does on establish the nexus between the parties for payments? Minors are not by law, allowed to enter into contracts. I think the fix will end up being challenged in the courts.

  6. Posted by Three-Fifths Compromise

    Perhaps, there’s a precedent evictees can cite and sue for partial payment per child.

  7. Posted by sassySFboy

    Great news for property owners in today’s Trumpesque world

  8. Posted by sfdragonboy

    Wake me when rent control is abolished across the land…

    Come on, Judge Gorsuch, this is your time to make a splash!!!

    • Posted by Notcom

      And which doctrine will he use:
      (1) A States Rights/local police power issue; or
      (2) a “takings” decision under the 5th Ammend; or
      (3) a reversion to the original holding of “Barron v. Baltimore” that the 5th didn’t apply to states.
      I’m partial to the last…just for entertainment value of exposing multiple hypocrisies.

      • Posted by anon

        Ninth Amendment or the Privileges or Immunities Clause. Heck, you think these guys are above just making stuff up?

  9. Posted by Chris Fong

    This typifies how these evictions are fought. The landlord will give notice, make the required payment(s), wait 1 year. Then the tenant(s) accept the payment, but remain in the unit and force a eviction hearing. At that point the landlord is already into it for the relocation costs and ~40k lawyers fees. Then the tenant will look for a procedural error, and if they can quash the motion to evict, the landlord has to start over.

    In this case, the landlord paid the maximum relocation payment, but allocated to three. The tenant says it should have been allocated to 4 (including the minor occupant). If the landlord did that, the defense would have been it should have been allocated to three. The whole point to to make it difficult for the landlord, or negotiate a buyout.

    In my case, the tenant’s teenagers grew up and moved away (for 10+ years). All of a sudden, when we served Ellis Act notice, we were informed these former occupants and entitled to additional relocation payments. We thought about disagreeing, that would “create” a defense, and the lawyer suggested it is not worth the risk.

    • Posted by bachman_erlich_overdrive

      How many of your tenants claimed to be disabled? How many were disabled?

  10. Posted by CC

    This is a bit off topic but does anyone have a guestimate on how much lawyers typically charge to do a OMI eviction on multiple units? Say I bought a building and my brother, mother and I each wanted to move into a unit.

  11. Posted by Anon #3

    As Anon2 has pointed out, this case is narrow and applies ONLY to Ellis Act evictions, and NOT other No Fault evictions, where relocation payments are due to “any authorized occupants, regardless of age.” Rent Ordinance sec. 37.9C.

  12. Posted by Conifer

    No doubt the Board of Supervisors will now pass a law including canine persons as tenants. In SF, canine persons are the true children of many people. If a canine person is forced out by the essential evil of the Ellis Act, he or she should be compensated just like any other person. If in doubt, please check the “canine person anti-eviction movement” website.

    This is part of the SF leftists policy of ending mom-and-pop ownership of residential properties. The only people who should buy residential properties in SF, other than to live in, are large corporations and individuals with deep pockets. This has been common sense for the whole of this century, but there are still some moms and pops who refuse to accept the message. The politicians remind them promptly.

  13. Posted by Keepitup

    Well that was quick….

    Ronen pushes to count SF kids as tenants for relocation payments (see name link)

    • Posted by SocketSite

      As we first pointed out (and emphasized) last week, in their ruling on the case of Danger Panda, LLC v. Launiu, the court added: “We emphasize that the question before us is not whether the San Francisco Board of Supervisors has the authority under the Ellis Act to confer a…relocation benefit on a child. Rather, we hold only that a minor is not a tenant entitled to a separate relocation payment under Rent Ordinance, section 37.9A(e), as currently written.”

  14. Posted by Keepitup

    I want my Shepard covered under the rent ordnance for Ellis Act evictions. Under SF rules she is not a considered a “dog” she is my “companion” and I am her “guardian” under the law. I’m going to sue the city on behalf of all “companion guardians” if they don’t cover her for relocation compensation and give her the same rights and protection as a child.

    Equal rights for all or no rights for all…

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