Tenant Troubles: You May Not Have To Sign That Lease, But Here’s Why You Should

We have lived in our rented house for two years and five months. We signed a year lease for the first two years, but as of February 10, 2013 we have not signed a lease.

Our landlord e wants a year-long lease signed in August 2013 so when he eventually has to find new tenants, it will be before the school year starts. We are trying to buy our first home together and we are trying hard but finding a home hasn’t been an easy process. I feel since he didn’t have us sign a lease in February (when our current lease was up) we are month to month and as long as we are paying rent we should be fine.

So the question is, can he kick us out for not agreeing to sign a lease?

Tenant Troubles Archives

Dave’s here to answer your questions every Wednesday, so send them to him at tenant@sfappeal.com. Here’s what to make sure to include in your letter.

This is a question I’ve never seen before. Certainly, refusing to sign a new lease could be a just cause for eviction under the Rent Ordinance. Rent Ordinance §37.9(a)(5) states:

A landlord shall not endeavor to recover possession of a rental unit unless the tenant, who had an oral or written agreement with the landlord which has terminated, has refused after written request or demand by the landlord to execute a written extension or renewal thereof for a further term of like duration and under such terms which are materially the same as in the previous agreement; provided, that such terms do not conflict with any of the provisions of this Chapter.

The key here is defining the lease which has terminated and when it terminated. The two-year lease terminated in February. It reverted to a month-to-month tenancy on February 10, 2013. Assuming that you pay rent on the 10th, the month-to-month tenancy will terminate today and if you pay rent it will renew again until August 10.

Your analysis of the issue is correct. You will not be obligated to sign anything other than a month-to-month agreement. No, the landlord cannot evict you under this just cause of the Rent Ordinance.

So if I put on my “slightly radical side of liberal” (I’m still steamed about that one) tenants rights hat, I ‘ll advise you to tell the landlord to fuck off. End of story, right?

Wrong. There’s a reason why only seven notices to evict under 37.9(a)(5) were filed with the Rent Board last year. Landlords generally don’t want to lock themselves into fixed term leases for fixed rent. Why? Because they want to keep their options open. You never know what kind of rich sucker is going to come along and offer a gazillion bucks for your building. When the rube arrives with his suitcase of cash, your landlord doesn’t want to have to tell him that he can’t move in or jack up the rents because one of his serfs happens to have a lease.

The lease must contain “terms which are materially the same as in the previous agreement.” Rent is the most material term in a lease and in order to hold you to signing, the landlord cannot increase it. Most landlords who rent single family houses in San Francisco don’t have any incentive to require tenants to sign a longer term lease because they can increase the rent to whatever the market will bear.

Remember, your two-plus year tenancy is not covered by the price controls in the Rent Ordinance because you live in a house. Thank your state legislators for the Costa Hawkins Rental Housing Act which fucked over thousands of tenants in California! Because Democrat legislators don’t have the guts to repeal Costa Hawkins, like herpes, it’s a gift that keeps on giving.

If you refuse to sign a new lease at the same rent, your landlord will get pissed, see the light and increase your rent a thousand bucks a month.

You’re saving money to buy a house, right? Ask yourself: 1) Are we completely insane? and, more importantly 2) Are we being penny-wise and pound foolish?

I think you’d be wise to simply sign the year lease if it does not increase the rent, or if the increase is reasonable. If you buy a house, you can give the landlord a thirty-day notice. You will breach the lease if you move early, but the landlord can increase the rent to market.

By then the rental value would be, what, 100 times what it is now? Most landlords would jump at the chance. Landlords are required by law to mitigate their damages. If the landlord can only re-rent the house at the same price he’s renting to you, he won’t have any damages for breach. You can even get your security deposit back.

Yes, you have tenant rights, but sometimes the best strategy is to refrain from exercising them.

the author

Dave Crow is an attorney who specializes in San Francisco landlord tenant law. However, the opinions expressed in these articles are those of the author, do not constitute legal advice, and the information is general in nature. Consult the advice of an attorney for any specific problem. You understand that no attorney-client relationship will exist with Dave Crow or his firm, Crow & Rose unless they have agreed to represent you. You should not respond to this site with any information that you believe is highly confidential.

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  • Tim Bracken

    “You will not be obligated to sign anything other than a month-to-month
    agreement. No, the landlord cannot evict you under this just cause of
    the Rent Ordinance.”

    I disagree with Mr. Crow’s reading of the statute. It says the landlord can evict a tenant who refuses to sign a new written agreement that is materially similar to the previous one. This refers to the last written agreement, not the month-to-month tenancy that springs up by default in the absence of a new written agreement.

    The last one-year lease terminated. (Mr. Crow incorrectly refers to this as a two-year lease, but the tenant indicated that these were two separate one-year leases). The landlord has asked the tenant to sign a new one-year lease. If the tenant refuses, the landlord can give a 30-day notice of the termination of the month-to-month lease.

    By the way, this reflects my personal opinion and does not constitute legal advice.

    • Dave Crow

      Tim,

      You are correct that the readers signed two one-year leases, but that doesn’t change my legal analysis.

      The tenancy had already reverted to a month-to-month tenancy for several months. So at this point, the oral or written agreement that terminated is a month-to-month tenancy. The landlord can only demand that the tenants sign a month-to-month extension with the same terms.

      Dave

      • Tim Bracken

        I still disagree with Mr. Crow’s interpretation for the following two reasons:

        (1) The statute refers to a new agreement that is materially similar to the previous agreement. A month-to-month tenancy is not an agreement. It is a default condition that fills the void and governs the parties’ rights and responsibilities when no agreement is in place.

        (2) It would defeat the purpose of this section of the statute to treat this as a one-time “use it or lose it” provision. The exception would swallow the rule if landlords could only insist on a new written one-year lease immediately after the current one expires.

        • Dave Crow

          You can disagree all you want. The statute says “the” previous agreement not “a” previous agreement.

          • Tim Bracken

            Right, and a month-to-month tenancy that takes effect in the absence of an agreement is not an agreement. So “the” previous agreement would be the expired lease agreement executed by the parties. Best wishes.

          • Tim

            Tim. I agree with Dave. The original Agreements (yr 2) lapsed and was recharacterized or merged into a “new agreement” with a month-to-month duration or term. In order to recharacterize it back, there should be a provision in the original agreement that authorizes a reverse recharacterization or in the absence of such provision, both parties must agree to the reverse recharacterization. Not a lawyer, but I think the judge would agree with Dave. Both parties take their chances entering into either a long term or month-to-month duration and the court should not shield the parties from the benefit of their bargain and the short or long-term consequences of their bargain good or bad. Make sense?

      • missy

        So our landlord wants us to sign a new lease…increasing to $400 a month for the house we rent. We agreed to $300 per an email from last year. She has been really ugly in her emails ( she gave us a good deal 7 yrs ago and only increased $50 on average a year until last year she wanted $500 increase and settled for $300) and we have not responded yet. Can we just not sign a new lease and keep paying the current amount until we find another place? Suggestions? Thanks!

        • Dave Crow

          Missy,
          I do not answer new questions in a comment bump. Please send them to tenant@sfappeal.com
          Dave

          • missy

            Hi Dave, Ok, I will be glad to but when I plugged the website name in on my Mac it told me that was a “phishing site” hope I spelled it correctly…..Thanks! 🙂

  • Tim Bracken

    “You will not be obligated to sign anything other than a month-to-month
    agreement. No, the landlord cannot evict you under this just cause of
    the Rent Ordinance.”

    I disagree with Mr. Crow’s reading of the statute. It says the landlord can evict a tenant who refuses to sign a new written agreement that is materially similar to the previous one. This refers to the last written agreement, not the month-to-month tenancy that springs up by default in the absence of a new written agreement.

    The last one-year lease terminated. (Mr. Crow incorrectly refers to this as a two-year lease, but the tenant indicated that these were two separate one-year leases). The landlord has asked the tenant to sign a new one-year lease. If the tenant refuses, the landlord can give a 30-day notice of the termination of the month-to-month lease.

    By the way, this reflects my personal opinion and does not constitute legal advice.

    • Dave Crow

      Tim,

      You are correct that the readers signed two one-year leases, but that doesn’t change my legal analysis.

      The tenancy had already reverted to a month-to-month tenancy for several months. So at this point, the oral or written agreement that terminated is a month-to-month tenancy. The landlord can only demand that the tenants sign a month-to-month extension with the same terms.

      Dave

      • Tim Bracken

        I still disagree with Mr. Crow’s interpretation for the following two reasons:

        (1) The statute refers to a new agreement that is materially similar to the previous agreement. A month-to-month tenancy is not an agreement. It is a default condition that fills the void and governs the parties’ rights and responsibilities when no agreement is in place.

        (2) It would defeat the purpose of this section of the statute to treat this as a one-time “use it or lose it” provision. The exception would swallow the rule if landlords could only insist on a new written one-year lease immediately after the current one expires.

        • Dave Crow

          You can disagree all you want. The statute says “the” previous agreement not “a” previous agreement.

          • Tim Bracken

            Right, and a month-to-month tenancy that takes effect in the absence of an agreement is not an agreement. So “the” previous agreement would be the expired lease agreement executed by the parties. Best wishes.

  • mtf

    Not quite the same issue – Our 12 mo lease expired 4 mo ago. Our ‘agent’ told us “no need for a new lease” we have been paying rent on time but would like to move. In the absence of a new lease, what are our rights and responsibilities? Can we still clai our security?What notice do we need to give?

  • priscilla t

    i need help making a decision, we are renting a house moved in 02/15 with a year lease ending 2/16. the landlord put the house up for sale 10/16 which was fine we allowed for open house and random showing during the week. we decided to apply for another house to rent the rental place called my current landlord for a reference she said she told them we were the best tenants. she then calls me after hanging up with them and told us she didn’t want us to move that she’s taking it off the market. so of course we decided to just stay here asking for another year lease. she agrees sends the new lease but says she is planning to put the house on the market again and if we sign the lease she promised we would be covered.. I don’t want to have to go through the whole open house and showings again due to the fact that it was the most stressful thing I experienced. but i also don’t want to not feel secured. what should I do? sign or no sign??? what is the best thing for me

  • Mark Talmadge

    Ridiculous. An attorney telling tenants not to exercise their tenant rights? LOLS. Sounds like this attorney represents landlords and doesn’t represent the rights of tenants.

  • Raina Ananda

    They landlord can’t demand it but he can still terminate your tenancy with 30 days notice if you are in a month to month lease.