A Primer on the Ellis Act and OMI Evictions in San Francisco

September 20, 2006

Background and Key Facts to Understanding the Ellis Act and OMI Evictions

Which buildings in San Francisco are subject to rent control laws? Buildings constructed before June of 1979 are generally subject to rent control laws. Single family residences (with no illegal units) and condominiums (with tenants who moved in after January 1, 1996), are exempt from rent increases provisions but are still subject to “just cause” eviction laws (see below for a definition of “just cause” evictions). However, the condominium exemption does not apply if the owner who converted it still owns the condominiums. Keep in mind that even tenants living in illegal units are protected by rent control laws.

How can a landlord evict a tenant in a rent-controlled unit? In San Francisco, a landlord generally must have “just cause” to lawfully evict his tenant, regardless of whether the tenant is on a month-to-month agreement.

The following is a list of the 14 “just causes”:

  • Tenant fails to pay rent, habitually pays the rent late, or gives bounced rent checks.
  • Tenant has breached the lease/agreement.
  • Tenant is committing/permitting to exist a nuisance in the rental unit, is causing substantial damage to the rental unit, or is creating a substantial interference with the comfort, safety or enjoyment of the landlord or tenants in the building.
  • Tenant is committing/permitting an illegal activity in the rental unit.
  • Tenant refused to execute a new lease/agreement with the same terms as the previous lease/agreement after the expiration of the lease/agreement.
  • Tenant has refused the landlord lawful access to the rental unit.
  • Tenant is a subtenant, not approved by the landlord, who is occupying the unit upon the termination of the lease/agreement.
  • Landlord wants to move-in and does so without ulterior reasons and with honest intent (see information and chart below regarding OMI evictions).
  • Landlord wants to sell the unit pursuant to an approved condominium conversion and does so without ulterior reasons and with honest intent.
  • Landlord wants to demolish or to otherwise permanently remove the rental unit from housing use and has obtained all the necessary permits, and does so without ulterior reasons and with honest intent.
  • Landlord wants to make capital improvements or rehabilitation work and has obtained all the necessary permits, and does so without ulterior reasons and with honest intent. (Tenants have the right to reoccupy the unit at the prior rent once the improvements are completed, which shall be no more than 3 months, unless a longer period is approved by the Rent Board. In addition, landlord must pay the tenant actual costs up to $1,000 for moving and relocation expenses.)
  • Landlord wants to perform substantial rehabilitation (generally for buildings that are more than 50 years old and need to be repaired to meet building or health and safety codes) and has obtained all the necessary permits, and does so without ulterior reasons and with honest intent.
  • Landlord wants to withdraw from rent/lease all rental units within any detached physical structure, or in the case of any detached physical structure containing three or fewer rental units, any other rental units on the same lot. (see information and chart below regarding Ellis evictions).
  • Landlord wants to perform required lead remediation or abatement work, and does so in good faith and for less than 30 days. (Landlord must pay tenants’ relocation fees.)

If a landlord wants to move-in to the tenant-occupied unit, can he evict the tenant?
Maybe. A landlord has two procedural options qualifying as “just causes” for an eviction: an owner move-in (“OMI”) eviction or an Ellis eviction. However, for both types of evictions, strict procedures must be followed.

What is an OMI eviction?
An OMI eviction is a type of legal procedure allowing landlords and their qualified relatives to move into a unit.

What is an Ellis eviction?
An Ellis eviction is a type of legal procedure conducted pursuant to the Ellis Act. The Ellis Act is a state law enacted in 1986 allowing landlords to legally evict all tenants in a building if they want to “go out of business,” i.e. if they remove all units of that building from the rental market.

What are the requirements of an Ellis and an OMI eviction?
See chart below. The legal requirements are constantly changing. Because of the procedural complexities and the frequent amendment of the laws, great care should be taken before instituting either an Ellis or OMI eviction.

What are the differences between an Ellis and an OMI eviction?
See chart below.

What happens if the process for performing an Ellis or OMI eviction is not properly performed?
Specific legal formalities are required for performing any evictions. Legal procedures pertaining to Ellis and OMI evictions are even more intricate. If proper procedures are not followed, the landlord will have to re-start the process, and the timeframe for the eviction will be delayed. In a worse case scenario, the landlord may be found to have committed a “wrongful eviction” and suffer monetary penalties.

What happens if an Ellis or OMI eviction is performed with an improper motive?
If it is determined that a landlord performed a “wrongful eviction,” he may be liable to the tenants for actual damages resulting from the eviction (e.g. the tenants' costs for moving, the difference for the tenants’ higher priced replacement unit, etc.) and for punitive damages. In addition, the landlord may be liable for punitive damages to the City as well as face misdemeanor charges.

Legal Requirements & Procedures for Typical Ellis and OMI Evictions

The information below addresses only the more common rules and exceptions to Ellis and OMI evictions and is not exhaustive. Ellis and OMI eviction requirements, exceptions and procedures are regularly amended, superseding existing laws. Thus, the following information should only serve as a general guide. It is advisable to consult an attorney before instituting an Ellis or OMI eviction.

Landlord Requirements OMI Evictions Ellis Evictions
Percentage of Landlord Ownership 25% if landlord became owner after February 21, 1991 (law changed back to 25% from 50%, as of June 2006).10% if landlord became owner on or before February 21, 1991. (Ownership percentages for spouses and registered domestic partners are aggregated.) N/A
Limit on Number of Units Qualifying for Eviction 1 eviction per building. However, additional evictions allowed for a child, parent, sibling, grandchild, grandparent, or a spouse of any such relations (registered domestic partners included). Residential tenants in all units of a building need to be simultaneously evicted.
Landlord’s Eviction Limited to the Same, Previously “Evicted” Unit If a landlord has previously performed an OMI eviction for a unit in a building, the landlord is bound to perform all future owner move-ins for the same unit, and not for any other units in that building. Even subsequent landlords are bound by this rule. N/A
Landlord Must Offer Tenant Other Available Units. If landlord has a “comparable” vacant unit anywhere else in San Francisco, he must offer that unit to the tenant for rent. If the landlord has another unit that isn’t comparable (i.e. higher/lower rent) the landlord must also offer that unit for rent, but can offer it at an adjusted rent amount. N/A
Protected Tenants Senior (age 60+) and disabled (SSI eligible) tenants with 10 or more years tenancy cannot be evicted. Terminally ill (SSI eligible & terminal illness diagnosis) tenants with 5 or more years tenancy cannot be evicted. Exceptions: Landlord is not bound by the protected tenant rule if: his dwelling is single-family, he has only 1 unit in the building, or if the landlord’s relative who is moving into the unit is age 60+. Tenants who occupy a unit during a condo conversion are entitled to remain for 1 year after conversion, or for life if they are age 62+ or disabled.
Procedures
Notice Period to Tenants 30 days. (The old rule, 60 days for tenants who had occupied the unit for 1+ year, has expired as of January 1, 2006.) Landlord must also file a notice with the Rent Board within 10 days of serving a notice to tenant. 120 days after landlord files Notice of Intent to Withdraw rental Units with the Rent Board and serves proper eviction notice on tenant. 1 year Notice for disabled tenants.
Landlord Move-in Timeframe Within 3 months of tenant(s) vacating the premise. N/A Landlord does not have to move in and can change the use of the building to, for example, commercial use.
Number of Years that the Landlord Cannot Re-rent the Unit. A landlord must have good faith intent to reside in the unit for 3 years. If the landlord re-lets prior to the 3 year benchmark, the unit must be re-rented at the same rent that the evicted tenant was paying prior to his eviction (plus any allowable annual rent increase), and the evicted tenant has the right of first refusal. An owner who re-rents any units within the first 2 years following withdrawal is liable to each evicted tenant for actual and punitive damages. If the landlord re-lets prior to the 5 year benchmark, the units must be re-rented at the same rent that the evicted tenant(s) was paying prior to his eviction (plus any allowable annual rent increase). The evicted tenant(s) has the right of first refusal to rent for the following 10 years after the eviction, at the prior rent for the first 5 years, and at a higher rent set by the landlord during the latter five years.
Subsequent Landlord Bound by Eviction Proceeding Yes. The 3 year benchmark is determined by the unit, not the landlord. Subsequent landlords are bound by the previous landlord’s rent control restrictions. Yes. The 2-, 5- and 10-year benchmarks are determined by the building, not the landlord. Even if the building is demolished, the rent control restrictions will apply to units in the subsequent structure.
Relocation Benefits $1,000 per tenant for tenants who have resided in the unit for at least 1 year. $4,503.42 per tenant (up to a maximum of $13,510.26 per household) plus an additional $3,002.28 for each tenant who is senior (age 62+) or disabled (a condition limiting a major life activity such as a physical, mental, social or work-related activity). (These rates are effective March 1, 2006 – February 28, 2007, and will be increased annually based on a CPI determination.)
© 2008 Szeto Law Group. These materials do not constitute legal advice and are for general informational purposes only. They may be reproduced for personal use and for non-commercial distribution. All copies must include this copyright statement.
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