Vacation Rentals

Tenants who list their units as short-term vacation rentals (for example on the website AirBnB) are exposing themselves to eviction. Short-term rentals violate “no-sublet” clauses, and may be in violation of a San Francisco law prohibiting tourist use of rental units. In rent-controlled jurisdictions, landlords are searching online for tenants who are renting their units out as vacation rentals and then issuing eviction notices. We have seen a rash of these in San Francisco in the last several months.

Landlords often attempt to evict under two theories: “illegal purpose” or “breach of sublease clause.” Our firm has been successful in challenging these eviction attempts.

Illegal Purpose

Tenants can fight an eviction based on illegal purpose by arguing:

  1. That the subletting was cured or not occurring when the notice was issued and
  2. That AirBnB is not an “illegal purpose” within the meaning of the Rent Ordinance.

Although listing a unit as a vacation rental may be a technical violation, it is hardly an “illegal purpose” as contemplated by Rent Ordinance section 37.9(a)(4). To prevail, a landlord would have to convince a pro-tenant, San Francisco jury that a tenant can be evicted for a minor violation.

In addition, if the eviction proceeds to trial, the following jury instruction is read to the jury:  “A landlord shall not endeavor to recover possession of a rental unit unless at least one of the fifteen just causes is the dominant motive for recovering possession.” Rent Ordinance § 37.9(c).

Where a tenant is paying far below market rate for the unit, the landlord has the ulterior motive of wanting to force the tenant out to charge more. The dominant motive is not to cure a technical violation of the lease.

Breach of Lease

If the landlord is attempting to evict for breach of lease, the tenant should argue that the Rent Ordinance (and often the lease agreement itself) requires the landlord to give the tenant an opportunity to cure. Landlord attorneys often counter that state law does not require an opportunity to cure an illegal sublet. Code of Civil Procedure section 1161(4). But, that section arguably only applies where a tenant has entered into a long-term sublease that the tenant cannot cure. All of the cases that have allowed eviction for sublease without an opportunity to cure involve long-term, full assignments. See Roth v. Morton’s Chefs Services, Inc., 173 Cal. App. 3d 380, 385 (1985) (holding that there is no duty to allow a cure for a restaurant sublease of five years); and Richard v. Degen & Brody, Inc., 181 Cal. App. 2d 289 (1960) (finding that sublease was so extensive that it was “useless” to offer an opportunity to cure in three days).

As with an eviction for “illegal purpose,” tenants should also argue that they were not subleasing at the time they received the three-day notice to quit. Code of Civil Procedure section 1161(4) requires that the tenant be in the act of subletting at the time of the notice. That statute uses the active tense as opposed to the past tense: “any tenant . . . assigning or subletting.” Id.

It is important that tenants contact an attorney regarding these issues, as situations vary greatly.