It was just past one o’clock in the afternoon on Oct. 12 at Legal Aid of Sonoma County, but one of the housing attorneys in the office had already received 35 phone calls. The final extension of California’s pandemic eviction moratorium had expired less than two weeks earlier, and tenants wanted to know how to avoid being kicked out of their homes.
At the local level, Sonoma County — like several other counties in the state — had maintained some protections for tenants whose finances were still reeling after a year and a half of COVID-19 lockdowns and restrictions. But the termination of eviction bans at both the state and federal levels had many tenants confused about their current rights in the ever-changing patchwork of housing law that’s marked the pandemic era.
“It’s a really complex landscape, and with some open legal questions,” said Suzanne Dershowitz, housing policy attorney for Legal Aid of Sonoma County. “Our office is doing everything they can to meet the need.”
And starting next month, yet another factor will be added to the mix: not only can landlords evict tenants for unpaid rent, but they’ll also be able to sue them for that rent in small claims court.
Under the eviction moratorium California enacted in response to the pandemic, landlords could not evict tenants for being unable to pay rent due to a COVID-19-related hardship between March 4 and Aug. 31, 2020. For unpaid rent that became due between Sept. 1, 2020 and Sept. 31, 2021, to avoid eviction, tenants who received a notice from their landlord had to pay at least 25 percent of the rent due for those 13 months by Sept. 30 of this year. These protections ended with the expiration of the eviction moratorium at the end of September, although many local protections remain in place.
The bill providing for that final extension of the statewide eviction ban, AB 832, also authorizes landlords to commence a small claims court action to collect COVID-19 rental debt starting on Nov. 1 of this year. The provision allows landlords to bring actions for amounts of that debt larger than the typical jurisdictional limits for small claims court — generally $10,000 for individuals and $5,000 for businesses.
According to the National Equity Atlas, a data tool measuring racial and economic equity and produced by the Oakland-based nonprofit PolicyLink, about 753,000 California households are currently behind on their rent, owing a total $2.6 billion.
Attorneys for both landlords and tenants in California are encouraging their clients to continue taking advantage of the state’s rent relief program, which provides financial assistance to low-income renters and their landlords who have been affected by the pandemic. Landlords bringing small claims actions against a tenant for unpaid rent must attach documentation proving that they’ve sought or cooperated with governmental rental assistance.
Still, attorneys who work in the state’s housing rights arena expect a swell in small claims filings come November. And for those working on the tenants’ side, making sure their clients are aware of their rights is top of mind — because in California small claims actions, attorneys can’t provide representation in court.
“We’re deeply concerned about the impending deluge of small claims cases,” said Dershowitz. “There have been so many changes to the state law in the last year. What we’re preparing for is getting folks ready to represent themselves.”
As the attorney leading the Renters Small Claims Project at the Legal Aid Foundation of Los Angeles (LAFLA), Kelsey Atkinson’s first and foremost message to clients is that even though you can’t have an attorney with you in a small claims hearing, you can still consult one about the case ahead of time.
“We’re trying to clear up any potential misconception that you’re not allowed to talk to an attorney at all,” Atkinson said.
LAFLA’s Renters Small Claims Project, which is funded by a grant from the California State Bar, runs clinics and develops educational materials specifically for tenants who will be sued for COVID-19 rental debt in small claims court starting in November. The project advises tenants on reading complaints, gathering evidence, and crafting legal defenses. For example, if a landlord fails in a complaint to attach the required documentation showing they’ve first tried to recover rent through the state’s rental assistance program, “that is really important evidence to bring to your small claims court hearing, because that can significantly reduce or prevent the landlord from recovering against you,” Atkinson says.
Another key piece of Atkinson’s messaging to clients is that a suit for COVID-19 rental debt is not the same as an eviction. “It cannot result in a tenant being forced to leave their home,” she said. “There’s a lot of misinformation and intimidation by landlords to try and get tenants to move instead of apply for rental assistance.”
At the Law Foundation of Silicon Valley, based in San Jose, Roza Patterson and Brooke Heymach are leading a similar effort: the foundation is queuing up a pro bono program specifically for COVID-19 back rent cases that will launch on Nov. 1. The program will train pro bono attorneys to help tenants review complaints and create defenses ahead of their small claims court hearings in those cases.
“Even though small claims court is supposed to be a place folks can navigate on their own, it’s still quite scary, and they could be left with a lot of debt,” said Heymach, the foundation’s pro bono director.
Patterson, a 2021 Racial, Social, and Economic Justice Fellow at the foundation who focuses on housing matters, said that even though small claims court is putatively navigable, many clients don’t know where to start. “We know that you can’t have lawyers in small claims court, but just navigating any part of the legal system is confusing,” Patterson said. “Many of our clients don’t have any experience in court. They find it terrifying and could use assistance.”
There’s also the concerning possibility that many of these tenants won’t make it to court to represent themselves at all. Dershowitz, of Legal Aid of Sonoma County, said she’s particularly concerned about default judgments against no-show plaintiffs in these cases.
“People with disabilities, people working eighty hours a week — there are so many reasons why people don’t show up to court, even when the stakes are really high, like having a judgment like this on your record,” Dershowitz said.
Just how many landlords will sue clients for their pandemic rental debt is a question that won’t be answered until next month. But as Atkinson puts it: “I’m preparing for a deluge.”
Judgments and the aftermath
Whether the flood predictions prove true, Olivia Dopler, a San Francisco attorney who primarily represents small landlords, said she doesn’t expect property owners to recover much from these small claims actions. For clients trying to recover COVID-19 back rent, her chief advice is still that they go through the state’s rental assistance program, in which she says most landlords are eager to participate.
“If people can pay their rent, they pay their rent, typically,” said Dopler, who is a partner at Steven Adair MacDonald & Partners At the end of the day, a judgment against a tenant in small claims court “is really just a piece of paper saying that someone owes you money. It doesn’t do much good unless you can actually collect on it.”
Meanwhile, that judgment can put even more pressure on a tenant’s already strained finances. They may take a payday loan, or a loan from a friend or family member. Judges often agree to payment plans based on a defendant’s statement of assets. But if the tenant fails to meet the plan’s requirements, landlords then have various enforcement tools at their disposal, like wage garnishment and bank levies.
“A serious and unfortunate reality is some tenants may consider filing for bankruptcy,” Atkinson said.
AB 832 contains some protections for tenants regarding the sale and assignment of COVID-19 rental debt. For any household that would have qualified for state rental assistance, if a judgment comes down against them for that debt, the landlord can never sell or assign it to a third party like a collection agency — some of which are notorious for harassment. Still, Atkinson says, “the reality is these judgments are going to have a big impact on folks’ financial well-being and their ability to find housing in the future.”
Defendants in small claims court — the tenants, in these cases — do have appeal rights. Plaintiffs (the landlords) do not. So if a small claims court rules for the tenant, it’s game over for the landlord. If a tenant has a judgment against them, they can appeal it and receive de novo review — and, at the small claims appeal stage, they’re allowed to have an attorney represent them in court.
But signing up for the appeal process is a tall order for defendants who may have found it difficult to make it to court the first time. “That’s a really heavy lift for people, after having just done small claims on their own,” Dershowitz said.
That’s why organizations like the Law Foundation of Silicon Valley are focused on securing a good outcome for tenants before small claims proceedings even reach the judgment stage. By understanding their defenses and getting advice on how to negotiate with the landlord who’s suing them, tenants can hopefully obtain “a better outcome than if they didn’t have pro bono support,” Heymach said. “Our goal here is to get them to a place where they can get as much advice about how to defend themselves and negotiate so they can land as softly as possible.”
Small claims v. civil court
Even though AB 832 waived small claims jurisdictional limits for lawsuits to recover COVID-19 rental debt, that doesn’t necessarily mean all of those suits will end up in small claims. If they want to, landlords still have the option of bringing those actions in a general civil court.
Dopler, the attorney who represents small landlords, said it seems one of AB 832’s goals in waiving those jurisdictional limits was to steer these cases out of civil court, and thus conserve court resources amid ongoing pandemic-induced backlogs and delays. “Small claims is just less burdensome on the court,” she said. “Regular civil court actions, those cases can go on for a year or more. Courts are already really behind and overburdened as it is.”
For attorneys on the tenants’ side, when considering whether their clients will face these suits in small claims or civil court, each jurisdiction has its pros and cons. For example, tenants can have attorneys represent them in civil proceedings, meaning they may be better positioned for a good outcome than they would be representing themselves in small claims court. But if all of California’s COVID-19 back rent cases were to go through civil court, Heymach said she’d worry that “there are just not enough attorneys out there.”
“Even if we start a robust pro bono program to do that, the system will be complicated and it will take a long time,” Heymach said. “The benefit of small claims is that it should be without lawyers, and the judges are kind of helping the defendants along the way. It is set up more for that.”
Atkinson pointed out that it’s not just the tenants who have to go without attorneys in small claims court — the landlords do too. “That said, a lot of landlords are going to be repeat players and at an advantage by bringing multiple of these cases,” she said. But “small claims court does have the benefit of being a bit more informal. Judges tend to be a bit more engaged and understanding toward tenants.”
In civil court, there’s also the possibility that tenants who don’t prevail could be liable not only for the unpaid rent but also for a landlord’s attorneys’ fees. AB 832 caps those fees at $1,000 in lawsuits for COVID-19 rental debt, both in limited and unlimited civil cases. But for a tenant still struggling to pay months of back rent, that amount isn’t insignificant.
Dopler said she’s hopeful that the landlords she represents won’t feel compelled to go to the courthouse — in either jurisdiction — to recover what she says for some is tens of thousands of dollars of unpaid rent. “What I tell all my clients about applying for rental assistance is that the system is completely set up to encourage and quasi-require that to be done,” she said. “Hopefully people will be able to get recovery that way.”
But Nov. 1 is still looming large on California tenants’ attorneys’ calendars.
“It remains to be seen whether our local protections are going to continue protecting tenants who are unable to pay due to COVID,” Dershowitz said of Sonoma County. “What is going to happen in small claims? Is this just going to be a factory, and people are going to have this enormous debt? Even if they don’t lose their housing, they’re still going to be living under the weight of this debt for years and years to come.”
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