July 21, 2009

Landlord Beware -- Trespass and Forcible Entry and Detainer

The crash last week of the Oscar Meyer Weinermobile into a home in Wisconsin is as good a reason as any to write a post about recent California case concerning trespass and forcible entry. The case is a reminder that a landlord cannot use self-help to evict an occupant of an apartment.

Lori Spinks was an employee of Mobile Medical Staffing, LLC ("Mobile"). Mobile rented an apartment in Sunnyvale for Spinks to occupy while on assignment. Spinks had surgery for an injury to her hand suffered on the job, and Mobile terminated the apartment lease and told the landlord to change the locks on the doors. The case got to the Court of Appeal after the landlord successfully moved for summary judgment on the grounds it did not owe any duty to Spinks because its lease was with Mobile.

The Court of Appeal reversed; its opinion reads like a primer on the rights of third party beneficiaries of contracts, the difference between a lease and a license, and causes of action for breach of the covenant of quiet enjoyment, trespass, forcible entry, invasion of privacy, etc. The Court found that there were a number of triable issues of facts on these claims.
While not breaking new ground, the opinion in Spinks v. Equity Residential Briarwood Apartments (2009) 171 Cal. App. 4th 1004 serves as a timely reminder in these difficult times that a party in peaceful possession of real property is protected by the forcible entry and detainer statutes even if he or she is technically a trespasser.

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July 11, 2009

Cal Foreclosure Consultants Must Now Register & Post $100K Bond

As the mortgage crises began, I received a number of unsolicited inquiries from people who were interested in starting a business to help borrowers in distress by purchasing and leasing back their residence or negotiating a loan modification. I explained to these callers that they would be acting as "foreclosure consultants" and would be subject to statutes in the Civil Code that regulate foreclosure consultants. Invariably, the callers were not aware of these statutes and were not interested in paying a lawyer to advise them how to follow the law. Apparently budding foreclosure consultants fancy the idea of a new business with no start up costs.

As the mortgage crises became worse, there stories in the news about unscrupulous people who would take a fee up-front to negotiate a loan modification (this is illegal unless an exemption applies) and then do nothing for the fee. The California Legislature was apparently moved by these stories to amend Civil Code sections 2945, et seq. effective July 1, 2009 so that "foreclosure consultants" are now require to register with the State and post a $100,000 bond. To learn more about the changes to the laws governing "foreclosure consultants," and the consequences if the laws are violated, click here or here.

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