Judge: Christopher K. Lui, Case: 23STCV06392, Date: 2023-05-19 Tentative Ruling

Case Number: 23STCV06392    Hearing Date: May 19, 2023    Dept: 76

TENTATIVE RULING:

Defendants Aviato Club, Inc., Victor Nikonetc, and Oleksandr Tatsenko’s demurrer to the Complaint is SUSTAINED with leave to amend. Plaintiff has 5 days to file an amended Complaint. If Plaintiff cannot truthfully amend to correct the above-identified deficiencies, Plaintiff shall dismiss the Complaint without prejudice and comply with the notice provisions as indicated by the Court before re-serving the notice to pay or quit.

ANALYSIS

Demurrer

Request For Judicial Notice

            Defendants’ request that the Court take judicial notice of the Complaint filed in this action is GRANTED per Evid. Code, § 452(d)(court records).

Meet and Confer

            Because this is an unlawful detainer action, the meet and confer requirement does not apply. (Civ. Proc. Code, § 430.41(d)(2); § 435.5(d)(2).)

Discussion

Defendants Aviato Club, Inc., Victor Nikonetc, and Oleksandr Tatsenko demur to the Complaint as follows: 

(1) Plaintiff failed to plead an exemption from an eviction-control ordinance.

            Defendants argue that, despite being labeled as a commercial lease, the lease is actually a residential lease because it was offered and leased for the occupants’ sleeping, as well as equipped for them to cook in the kitchen and use the washing machine, dryer, refrigerator, stove, and dishwasher. (Lease, page 1, second paragraph from the top.)

            The Complaint alleges that it is a “Commercial business lease” (Complaint, ¶ 6.d) and that “The lease is commercial. Tenant is a business.” (Complaint, ¶ 7.a.) However, “facts appearing in exhibits attached to the complaint will also be accepted as true and, if contrary to the allegations in the pleading, will be given precedence. (Citation omitted.)” (Dodd v. Citizens Bank of Costa Mesa (1990) 222 Cal.App.3d 1624, 1627.)

            Here, the Lease expressly acknowledges that it is for living space use: “Incubator/Co-working/Co-living space with focus on Information Technology.” (Complaint, Exh. 1; Lease, ¶ 3.) The use as a living space is also bolstered by the fact that the unit has a kitchen, living room, dining room, and all rooms + hallways with in the unit, washing machine, dryer, refrigerator, stove, dishwasher. (Lease, Page 1, second paragraph.) Moreover, the Lease contemplates that persons would not only work, but also sleep on the premises. (Lease, Page 4, ¶ 4.) The terms of the lease suggest this is actually a residential lease for purposes of the rent control laws cited by Defendants.

            While Plaintiff argues that an entity cannot rent a residential space, two individuals—Victor Nikonets and Oleksandr Tatsenko are also named as Tenants. As such, the Lease is residential for purposes of unlawful detainer.

            Defendants argue that Plaintiff must have “just cause” for eviction, and that non-payment of rent does not constitute “just cause.” However, Defendants do not cite any authority for this proposition. Indeed, non-payment of rent appears to be the most objective just cause for eviction. (See Civil Code, § 1946.2(b)(1)(A)(specifying default in the payment of rent as “just cause.”) Defendants make a vague reference to currently imposed moratoria on eviction, but do not specifically cite the source of such moratoria.

            On the other hand, Plaintiff’s discussion of the Los Angeles Rent Stabilization Ordinance is not pertinent to the Court’s discussion, below. Likewise as to Plaintiff’s discussion of Civil Code, § 1954.25 et seq.’s prohibition on price controls of commercial real property.

(2) Plaintiff did not plead compliance with Civil Code 1946.2 subdivision (c). 

Defendants argue that this action is for an alleged non-payment of rent, thus the defendants here are sued for an alleged curable breach of the lease agreement. The 3-day notice clearly stated on its face that the breach is curable, by framing its demand in the alternative: pay or quit. (Complaint, Exhibit 2, p. 1.)

Defendants argue that a Civil Code, § 1946.2(c) requires that a preliminary notice be given so that the tenant has 3 days to cure, and if the violation is not cured within that time period, a three-day notice to quit without an opportunity to cure may thereafter be served to terminate the tenancy.

Defendants argue that Plaintiff did not plead compliance with this provision, nor does the Complaint attach any exhibits to show compliance.

As noted above, because the Lease is residential, § 1946.2(c) applies:

(c) Before an owner of residential real property issues a notice to terminate a tenancy for just cause that is a curable lease violation, the owner shall first give notice of the violation to the tenant with an opportunity to cure the violation pursuant to paragraph (3) of Section 1161[1] of the Code of Civil Procedure. If the violation is not cured within the time period set forth in the notice, a three-day notice to quit without an opportunity to cure may thereafter be served to terminate the tenancy.

     (Civ. Code § 1946.2(c).) 

Here, Exhibit 2 attached to the Complaint is a Commercial Notice to Pay Rent or Quit, which states that if, within 3 days of service of the copy of the notice, the total delinquent rent is not paid, or the premises is not quit and delivered up for possession, legal action will be instituted for possession of the premises. The notice is dated March 6, 2023, and it was served on March 7, 2023 by overnight delivery.

The Complaint does not allege, nor attach documents reflecting, that the preliminary 3 day notice giving an opportunity to cure the violation was given before a three-day notice to quit without an opportunity to cure was served to terminate the tenancy, as required by Civil Code, § 1946.2(c).

This ground for demurrer is persuasive.

(3) The notice is ambiguous and is premature.

Defendants argue that the facts in the lease, the 3-day notice, and the proof of service of said notice, all show that the notice was issued prematurely. The copy of the lease attached to the complaint clearly states that the tenants have 10 days to pay the rent prior to issuance of the 3-day notice. (Lease, p. 3, par. 14, subd. (b).) The notice, however, issued on the 6th and served on the 7th day, both well before the 10-day period had expired. (Complaint’s Exhibits 2 & 3.) Thus, on the face of the complaint it is shown that the notice was premature.

            This argument appears to be persuasive: Rent was due on the 1^st of the month, and after three days, a $25 per day late payment penalty would issue. If rent is not paid by the 10^th of the month, then a 3-day pay or quit notice would issue. (Lease, ¶ 14.)

This ground for demurrer is persuasive.

(4) The notice was improperly served.

Defendants argue that the proof of service shows that the notice was sent via FedEx. The Lease does not prescribe the method of service of a notice to pay or quit. Defendants argue that service by Fed Ex does not comply with Civ. Proc. Code, § 1162 for either residential or commercial tenant.   

In commercial leases the landlord and commercial tenant may lawfully agree to notice procedures that differ from those provided in the statutory provisions governing unlawful detainer. (See Folberg v. Clara G. R. Kinney Co. (1980) 104 Cal.App.3d 136, 141 [163 Cal. Rptr. 426] [parties to commercial lease may lawfully agree to notice provisions different from those provided in §§ 1161 & 1162]; 250 L.L.C. v. PhotoPoint Corp. (2005) 131 Cal.App.4th 703, 718 [32 Cal. Rptr. 3d 296] [parties to commercial leases may waive rights under Civ. Code].) Thus, if the lease contains service requirements for the notice to quit at variance with the requirements in the unlawful detainer statutes, the lease provisions control. (Folberg, at p. 141.) 

. . .

In sum, Culver Center failed to comply with the lease's provisions for service of a notice to quit. Because there is no evidence Baja Fresh expressly waived the notice provisions in the lease, Culver Center's improper service of the notice precludes its access to the summary remedy of unlawful detainer.

(Culver Ctr. Partners E. #1, L.P. v. Baja Fresh Westlake Vill., Inc. (2010) 185 Cal.App.4th 744, 750, 752.) 

In any event, Defendants’ argument is not persuasive because service by mail which results in actual notice to the tenant constitutes personal service for purposes of the unlawful detainer notice provisions.

In Weiss, an unlawful detainer case, the appellate court found that service of the notice to quit by mail was improper under section 1162. Nonetheless, because the landlord established it had served the notice to quit by mail and the tenant admitted he had received it in the mail, the court found section 1162's requirements for personal service had been satisfied. (Weiss, supra, 208 Cal.App.2d at p. 769 [“personal service may be made through the instrumentality of the mails[;] [t]he post office department, as well as any other type of messenger, may be used to effect personal service”]; accord, Valov v. Tank (1985) 168 Cal.App.3d 867, 876 [214 Cal. Rptr. 546] [where defendant managed to successfully evade the process server, but admitted he received the notice landlord posted and mailed to his home address, “personal service under section 1162, subdivision 1, had been effected”]; Wilcox v. Anderson (1978) 84 Cal.App.3d 593, 596–597 [148 Cal. Rptr. 773] [where landlord established notice was properly mailed to tenant and tenant did not contest he actually received the notice to quit, landlord complied with § 1161's personal service requirements].)

(Culver Ctr. Partners E. #1, L.P. v. Baja Fresh Westlake Vill., Inc. (2010) 185 Cal.App.4th 744, 751 [bold emphasis added].) 

            A fortiori, service by FedEx which results in actual notice constitutes personal service for purposes of Civil Code, § 1162(a) or (b). This would be better notice than the certified mail, return receipt requested, as specified in ¶ 20 of the Lease.

            However, as noted by Defendants, the corporate tenant—Aviato Club, Inc.—is not noted to have been served by its agent for service of process. On this basis, the notice was not properly served on the entity tenant.

            The demurrer on this basis is persuasive as to Defendant Aviato Club, Inc..

(5) The complaint is not properly verified.

            Defendants argue that the Complaint is not properly verified as required by Civ. Proc. Code, § 1166(a)(1) because the verification states that the named Plaintiff in this action—Guy Hart—is a person most knowledgeable and is authorized to make the verification on its behalf. Defendants argue that it is unclear who “its” refers to.

            This argument is not persuasive. GH Property/Guy Hart is listed as the Landlord. As such, Hart has authority verify the Complaint on his own behalf and, presumably, of GH Property, which one can infer is shorthand for Guy Hart Property.

            This ground for demurrer is not persuasive.

            For the foregoing reasons, the demurrer to the Complaint is SUSTAINED with leave to amend. Plaintiff has 5 days leave to file an amended Complaint. If Plaintiff cannot truthfully amend to correct the above-identified deficiencies, Plaintiff shall dismiss the Complaint without prejudice and comply with the notice provisions as indicated by the Court before re-serving the notice to pay or quit.