Update to Landlord Law

Anthony Burton
Feb 14, 2019
3 min read

To all my Landlords out there... In our continuing effort to help you make informed decisions, the following article is a really informative piece for anyone owning and/or operating residential income property.

The author - Anthony Burton (Meyers Law Group) is a good friend, trusted adviser, and should be top-of-mind for any landlord tenant issues. Anthony is highly experienced in handling landlord tenant disputes including evictions, lease disputes, lease buyouts and habitability claims.

Anthony also maintains his own highly informative blog, which can be found at http://carealestatelawblog.com/ Keep informed!!

Now, on to the article:

Update in law requiring Landlord to accept rent from third parties beginning January 1, 2019

For years, the law has regulated the terms and conditions of residential tenancies including how tenants pay their rent. The law requires a landlord or their agent to allow a tenant to pay rent or a security deposit by at least one form of payment that is neither cash nor electronic funds transfer (subject to certain exceptions).

Beginning January 1, 2019, residential landlords must now also accept such payments when they are made by a third party who is not a tenant who rents from the landlord. This means that friends, family members or other individuals who the tenant requests or authorizes to make a payment on their behalf to the landlord or the landlord’s agent must be allowed to make payments for the tenant. This requirements is not without its limitations. The law also says that the landlord or landlord’s agent is not required to accept payments made by third parties “unless the third party has provided to the landlord or landlord’s agent a signed acknowledgment stating that they are not currently a tenant of the premises for which the rent payment is being made and that acceptance of the rent payment does not create a new tenancy with the third party.” If the third party fails to provide such an acknowledgment, it voids the landlord’s obligation to accept rental payments from the third party. The landlord or their agent can require the third party to sign an acknowledgment each time a rental payment is made or, for efficiency’s sake, they can agree to execute a single acknowledgment that covers more than one rental payment.

If the third party uses its own acknowledgment form that is, substantially, in the same form required by law then the landlord or their agent must accept it. Practically speaking, the landlord or their agent should have their own form acknowledgment prepared and ready for any third parties to execute and should insist on use of such a form. This will give the landlord more control over how they accept the payment of rent from all sources which is important because the landlord wants to avoid the appearance or creation of a landlord tenant relationship with all persons other than the tenant. A poorly drafted acknowledgment form could have the effect of creating a landlord tenant relationship with the third party unknowingly which could prove very problematic for the landlord if legal issues arise later. The landlord would then have to bring legal proceedings against their tenant as well as the third party in the event an eviction or related proceeding had to be initiated. A well drafted form acknowledgment would create assurances for the landlord that such a situation would be avoided even if the third party previously made rent payments. Furthermore, in the event any third parties attempted to claim they have any possessory rights in and to the property for which they previously paid rent, an executed acknowledgment signed by the third party would likely be admitted into evidence against the third party thereby disproving such claims and saving the landlord time, expense and a lot of headaches. A copy of a form that landlords or their agents could use in such a situation can be found here.

Should you have any more questions, please feel free to contact the author Anthony Burton. He is a real estate attorney practicing in Orange County, California. While his practice covers general real estate practice he has substantial experience in handling landlord tenant disputes including evictions, lease disputes, lease buyouts and habitability claims. He can be contacted at anthony@themyerslg.com or anthonywburton@gmail.com