Illegal Rental Agreements: Suspicious Terms in California Leases

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A landlord/tenant agreement in California can be negotiated between the parties. However, in tight rental markets like San Francisco and Los Angeles, the landlord usually prepares the contract in advance and the tenant is told to sign it. But sometimes landlords either don't know or don't follow California laws and include illegal provisions in the agreement. A few of these illegal rent agreement terms are more common than others, and every prospective tenant should be on the lookout for them.

Excessive Security Deposits

Security deposits are amounts of money — other than rent — that a tenant is required to pay the landlord upfront when she moves in. These can be simply termed "security deposits," but they also have other names like pet deposit, damage deposit or cleaning deposit. This is money that belongs to the tenant but is held by the landlord for the duration of the tenancy. The idea is to provide the landlord with security in case the tenant fails to pay rent, damages the premises or simply leaves the unit in terrible condition.

The rationale for security deposits is simple: It prevents a landlord from having to go to court to recoup money from a former tenant who doesn't return the property in good shape. Court actions can be difficult against tenants who move out of the area or have little or no assets.

However, California law caps the amount of a security deposit a landlord can demand. It allows a landlord renting out an unfurnished unit to seek twice the amount of monthly rent in security deposits. For furnished units, the maximum is three times the amount of monthly rent. For example, if a tenant is paying $2,000 a month in rent, the maximum security deposit for an unfurnished unit is $4,000; for a furnished unit, it is $6,000.

Read More: Can Unpaid Rent Be Deducted From Security Deposits in California?

Last Month's Rent

In California, first month's rent is not considered part of the security deposit, but last month's rent is. That means that a landlord can ask for last month's rent upfront, but the amount is included in the legal cap on security deposits.

A tenant paying $2,000 rent for an unfurnished unit may be asked to give a $2,000 last month's rent deposit, but that counts toward the maximum legal security deposit of $4,000. If, in addition to last month's rent, the tenant is asked for a $3,000 security deposit, it constitutes an illegal rent agreement.

Nonrefundable Deposits

Sometimes landlords ask new tenants for nonrefundable deposits, that is, amounts of money they will never see again, essentially fees. Typically, this comes in the form of a cleaning deposit or a key deposit, and the tenant is informed that the nonrefundable amount is to cover the cost of vacuuming carpets or replacing the locks when he moves out.

However, nonrefundable deposits are illegal in California. Including a provision in the rental agreement that requires a tenant to put down a nonrefundable deposit makes the rental contract illegal.

Prohibition on Service Animals

Landlords are free to prohibit pets in rental units, including any animals, from dogs and cats to a goldfish. This prohibition is usually spelled out in the rental contract. However, both federal and state laws prohibit a landlord from refusing to allow a tenant to keep a service animal.

In California, a tenant has an absolute right to keep a service dog and/or an emotional support animal in rented premises even if the rules forbid keeping pets. Landlords are required under law to make "reasonable accommodations" in their rules if necessary to allow a person with a disability an equal opportunity to rent a unit. This means that even if a landlord doesn't usually allow tenants to keep animals on the premises, he must allow a disabled person to have an animal that provides disability-related assistance.

The only exceptions to this are when the individual animal poses a direct threat to the health or safety of others or will cause physical damage to the property of others. However, this cannot be based on fear or speculation, and the landlord cannot refuse a service dog because of breed or size.

Pet Deposit for Service Dog

Sometimes a California landlord will allow a tenant to keep a dog or cat on the premises in exchange for a substantial pet deposit that can be used to clean up any damage the pet causes. However, it is against California law to charge a tenant a deposit for keeping a service animal. If a lease requires such a deposit, it is illegal.

Permission to Enter Without Notice

Tenants who rent apartments or homes expect more than just having the use of the rooms; they expect exclusive use of the premises. If others are allowed to enter the premises without the tenant's knowledge and consent, they violate the privacy of the tenant. This is true even if they are the owners or managers of the building.

On the other hand, it is sometimes essential that the landlord have the right to enter the unit. For example, if a smoke detector is going off in an apartment, and it appears that the tenant is not home, the landlord has a real and pressing need to see what is happening.

California law balances these competing interests. It allows a landlord to enter a unit without giving notice in an emergency situation, like a fire. It also allows a landlord to enter rental units in several nonemergency circumstances if he gives the tenant reasonable advance notice. These circumstances include showing the unit to prospective tenants or inspecting or repairing the unit. The notice must usually be in writing and set an exact date and range of time for the entry and must be scheduled during normal business hours.

Tenant Liability for Wear and Tear

A tenant that pays rent buys only the right to the exclusive use of the unit; she doesn't buy the property itself. That means that, in time, possession will revert to the landlord who expects it to be returned in reasonable condition. If the tenant damages the unit, like breaks a window, smashes holes in the walls or tears up the backyard, she is legally liable for the costs of repair.

On the other hand, a tenant doesn't have to leave the property in exactly the same condition it was in when she moved in. Imagine if someone lives in a unit for 10 years. Even with excellent care, the unit will show some wear and tear. For example, the carpet may be worn down, the faucet leaking, the countertop scuffed or the paint yellowing.

In California, a landlord cannot charge a tenant for ordinary wear and tear. He cannot withhold money from a security deposit to replace the carpet or repaint the unit, for example. Ordinary wear and tear will inevitably result from ordinary use. If a landlord includes a provision that directly or indirectly charges the tenant for this type of wear, it is illegal under California law.

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About the Author

Teo Spengler earned a J.D. from U.C. Berkeley's Boalt Hall. As an Assistant Attorney General in Juneau, she practiced before the Alaska Supreme Court and the U.S. Supreme Court before opening a plaintiff's personal injury practice in San Francisco. She holds both an M.A. and an M.F.A in creative writing and enjoys writing legal blogs and articles. Her work has appeared in numerous online publications including USA Today, Legal Zoom, eHow Business, Livestrong, SF Gate, Go Banking Rates, Arizona Central, Houston Chronicle, Navy Federal Credit Union, Pearson, Quicken.com, TurboTax.com, and numerous attorney websites. Spengler splits her time between the French Basque Country and Northern California.