May a landlord maintain an unlawful detainer (UD) action against a tenant who had a prior conflict with the landlord when the landlord intends to remove the property from the rental market?

640 Octavia, LLC. v. Karl Heinz Pieper

Facts:  The landlord of a multi-unit property enters into a license agreement with their partner and another individual allowing occupancy of units with the landlord retaining exclusive possession of the units involved. One other tenant resides in the only other unit. The landlord and tenant are involved in an on-going conflict. The landlord decides to remove the property from the residential rental market so a family member can occupy the unit. The landlord serves the tenant with a notice of termination of tenancy (NOT). The landlord does not serve the NOT on their partner or the other occupant. The tenant fails to vacate the property on expiration of the NOT. The landlord files an unlawful detainer (UD) action against the tenant to recover the property.

Claim: The tenant claims the landlord may not maintain a UD action since the landlord did not serve a NOT on all tenants and terminated the tenant’s occupancy in retaliation for their on-going conflicts.

Counterclaim: The landlord claims they may maintain a UD action against the tenant since the other occupants were licensees without exclusive right to possession of the property, and the landlord had a bona fide reason for withdrawing their property from the rental market.

Holding: A California appeals court holds the landlord may maintain a UD action to evict the tenant under a NOT based on removal of the property from the residential rental market since the other occupants as licensees are not tenants and do not have exclusive possession of the property requiring a NOT, and landlords may remove their property from the rental market in compliance with ordinances and codes based on a bona fide reason for terminating tenancies even when they also have a retaliatory reason. [640 Octavia, LLC. v. Karl Heinz Pieper (2023) 93 CA5th 1181]

640 Octavia, LLC. v. Karl Heinz Pieper

Related RCDs:

Is a landlord withdrawing their property from the rental market required under a local rent ordinance to notify tenants of their re-rental rights under future owners?

May a city prohibit a landlord defying the Ellis Act from re-renting previously vacated rental units?

Related Article:

California Ellis Act evictions cause controversy

Related Reading:

Real Estate Principles —Chapter 81: Notices to vacate

Property Management — Chapter 12: Exclusive authorization to lease