Governor Gavin Newsom has issued Executive Order N-80-20, extending through March 31, 2021 Executive Order N-28-20, which allows local governments to impose commercial eviction moratoriums and restrictions for commercial tenants who are unable to pay their rent because of COVID-19.

The governor’s order only addresses commercial evictions (as AB 3308 fully addressed residential evictions through

Effective January 20, 2020, eviction controls under the San Francisco Rent Stabilization and Arbitration Ordinance (Administrative Code Chapter 37) (the “Rent Ordinance”) apply to any residential units constructed after June 13, 1979, and any residential units that have undergone substantial rehabilitation.

The rent limitations and the eviction controls enumerated in the Rent Ordinance previously applied only to apartment buildings with a certificate of occupancy issued before June 13, 1979.  Under San Francisco Ordinance No. 296-19 (the “Haney Amendment”), the “just cause” eviction provisions in the Rent Ordinance now apply to all apartment buildings.

Part of the rationale for the Haney Amendment is to reconcile the eviction controls in the Rent Ordinance with the California Tenant Protection Act, which established statewide rent caps and eviction controls for most residential properties built before 2005. The Tenant Protection Act does not supersede local rent control or eviction protections, so long as the local ordinance is more protective. (For more information about the details of the intricacies of the Tenant Protection Act, see our previous update.)

The Haney Amendment found that the Rent Ordinance is more protective than the Tenant Protection Act because it provides more limited reasons for evicting tenants as well as higher relocation assistance and other tenant protections.  Under the Haney Amendment, landlords will now be required to pay relocation fees due under the Rent Ordinance, follow the buyout procedures specified under the Rent Ordinance, and comply with the Rent Ordinance regulations on capital improvements. Except for the rent limitations prescribed under the Rent Ordinance, all provisions of the Rent Ordinance now apply to apartment buildings built after 1979.
Continue Reading San Francisco Expands Just Cause Eviction Protections

The San Francisco Jobs Housing Linkage Fee (JHLF) is set to more than double under the “Housing for SF Workers” ordinance recently passed by the San Francisco Board of Supervisors (Ordinance). Mayor London Breed refused to sign the Ordinance, but even without the Mayor’s signature, Housing for SF Workers becomes effective on December 15, 2019.

An annoying question for lenders is whether a lender can enforce two loans to the same borrower and secured by the same property.   The nagging issue is usually raised when a lender makes (1) a first loan and an additional advance to the borrower secured by the same property, (2) a first secured loan followed by a secured credit line, or (3) a first secured loan and a new secured second loan to finance other properties.

In California, there can only be “one form of action,” either a judicial foreclosure or a non-judicial foreclosure.  In a judicial foreclosure, if the real property collateral is sold for less than the amount owed under the secured debt, the lender may sue for a deficiency judgment – the difference between the amount owed and the fair market value of the property.  (Cal. Civ. Pro. Code § 726.); in a judicial foreclosure, the borrower has a right of redemption.  In a non-judicial foreclosure,  no deficiency judgment is allowed under a power of sale in a deed of trust.  (Cal. Civ. Pro. Code § 580(d).); in a non-judicial foreclosure, the borrower has no right of redemption. When there is a senior deed of trust and a junior deed of trust and the senior lender sells the property by a non-judicial foreclosure and the real property collateral is sold for less than the amount owed under the total secured debt, the junior lender becomes a “sold-out junior,” and the junior lender may enforce its promissory note against the borrower in a judicial proceeding,  (Roseleaf Corp. v. Chierighino (1963) 59 Cal.2nd 35, 43-44.)
Continue Reading Double Trouble – Is Black Sky Capital Blue Skies for Lenders?