Berkeley city council amends ordinance to help tenants; landlords can still collect damages

(UPDATE 7/2/20): The Berkeley City Attorney's office has evaluated the city council's amended emergency ordinance attempting to make it easier for tenants to break leases and offered clarification for understanding. The clarification points to California civil code which permits a landlord the right to pursue unpaid/lost rent over the duration of the lease term.  It vastly reduces the scope and impact of the changes the council made.  Below is from the updated ordinance: 

"The Berkeley City Attorney’s office has indicated that even if students terminate their leases under the recent Berkeley emergency ordinance (see ordinance details below), the landlord still has the right to pursue unpaid/lost rent over the duration of the lease term under state law (California Civil Code Section 1951.2).

This would mean that landlords can still seek reimbursement for losses of rent resulting from the lease termination, subject to the landlord’s duty to mitigate these losses by seeking replacement tenant(s).  According to this interpretation by the City Attorney, the pursuit of lost rent by the landlord pursuant to California Civil Code 1951.2 would not be considered a “penalty” under the Berkeley emergency ordinance.

However, the Berkeley City Attorney has also indicated that tenants whose leases have not yet started may be able to terminate their leases under the emergency ordinance without paying any fee or having further liability.  If your lease term has not yet started, it is recommended that you send a termination notice to your landlord (more information about this is below), so that if the City Attorney confirms this interpretation, you will have already sent the notice."

In response to concerned students, Councilman Rigel Robinson has sent the following response: 

"There are countless students in situations just like yours. An ordinance approved on Tuesday in partnership with Student Legal Services and the City Attorney’s office was fortunately approved unanimously by the council. We hoped to help all the students in a situation like this, and elements of the ordinance will still help many of them, but unfortunately its scope has been dramatically reduced. State preemption restricts much of what we hoped the ordinance could achieve, and we are in talks with our state representatives to seek a remedy from their end. Many landlords have responded with hostility to their tenants, which is unfortunate.

I understand how frustrating this must be. While the language we just approved will help many students, its impact will not be nearly as broad as initially expected. We’re continuing to look for additional ways to help alleviate students’ rent burdens caused by the pandemic, but state law is a significant barrier. There may be other ways yet we can try to alleviate the unfair rent burden on students who are stuck in leases in a city they may not even live in right now.

If you think you may benefit from the ordinance, it’s essential that you get in touch with Student Legal Services and/or the Eviction Defense Center, who have been doing absolutely incredible work advising students and tenants through this crisis. Every lease is different, every tenant’s situation is different. I hope this information is helpful!"

On Tuesday night, the council passed amendments to clarify the existing prohibition of lease termination fees and attempted to make it easier for tenants to break a lease if they have been impacted by the coronavirus. 

The new addition pertains to tenants who have a “covered reason for delayed payment” and “tenants or roommates of the tenants are or were registered at an educational institution that canceled or limited in-person classes due to the COVID-19 pandemic.”  It allows them to terminate a lease agreement with 30-days’ notice, without penalty for the duration of the State of Emergency. It has the potential to impact thousands of UC Berkeley students.

The issue was raised by numerous students like “Peter,” a PhD student at UC Berkeley.  He only wanted to be identified by his first name. Trying to get ahead of the competitive rental market, he and two friends signed a lease at the Sterling Alltston in April for the new school year.  As the coronavirus forced schools to move many classes online, one of Peter’s roommates decided not to return. “If only two of us were to pay this rent, then, 80% to 90% of our salary as student researchers will be going to that,” said Peter.

Weary of the price, Peter did what many college students are doing—tried to break a lease.  His contract included an “early termination option,” allowing him to give notice, pay an amount equal to two month’s rent and leave. But the company, Sterling Housing, told him the option was void, citing a city ordinance preventing landlords from charging additional penalty fees for tenants leaving contracts.

Instead, Sterling said he was on the hook for the rent until his place was re-rented. “They somehow decided to weaponize that against us to put all the liability, financially or to find, re-rent, whatever on us,” said Peter.

After hearing from dozens of Sterling tenants and others, the city council clarified the emergency ordinance.  “These landlords got greedy, and asked for a lot more money than they should’ve,” said Soli Alpert, a member of the Berkeley Rent Stabilization board.  “They could’ve taken $8,000 and walked away.  Now they get nothing because these tenants don’t deserve that hanging over their head.”

Sterling and its parent company did not respond to our request for comment.

The move by the city comes as a relief to tenants’ rights attorney Joseph Tobener, who was working with 18 students on the issue. He applauds the decision, but says the state needs to step in to deal with the housing disaster caused by the coronavirus—instead of a piecemeal approach from local jurisdictions. “If we put together a law that allows tenants to break leases, I certainly think landlords should be able to seek compensation, maybe the government steps in and gives subsidies to those landlords,” said Tobener.

The city of Berkeley joins Solano county, which passed a similar provision. It allows renters to break a lease without penalty with 30 days-notice, if doing so because of the pandemic.