12 Tricks to Terminate a Student Lease at UCR due to Coronavirus Force Majeure [UC Riverside]

How to Terminate Your Lease at University Village Towers, GrandMarc At University Village, University Riverside Gardens, The Palms on University, & Highlander At North Campus at UC Riverside

As the official, volunteer real estate lawyers for the Associated Students of UC Riverside Legal Clinic, we have been inundated with questions from UCR students who signed leases near the UCR campus where no classes are being held in Fall 2020 due to the Coronavirus pandemic. We have numerous strategies to provide to these students during this unusual, global event. Commercial real estate attorney Scott Talkov was even interviewed in this article by the Press-Enterprise regarding terminating student leases early at UCR because of his knowledge on the subject.

First, this post is primarily directed at students who signed their leases prior to the State of Emergency that was declared nationally on March 13, 2020. Those who signed their leases after this date will have a more difficult time alleging that the pandemic is an unforeseen circumstance. Nonetheless, it may still be unforeseen that an entire college campus is now closed.

First Rule of Negotiation: Know When to Walk Away

Before we get into the tips and tricks on how to terminate a lease at UCR, it is very important to enter every negotiation in life knowing when you are willing to walk away. If the other side senses that you will always say yes to giving them what they want even if the other side says “no” to all of your requests, you can bet your bottom dollar that the other will indeed say “no” to every request. Your power as a student or parent-guarantor on any of these leases is your willingness to not make payment under the lease voluntarily.

In other words, your willingness to force the other side (the landlord) to obtain involuntary payment through the time and effort required to file a civil lawsuit is your power. If the landlord senses that you are so afraid of this option that you will pay them in full every month just to avoid this happening, you will get absolutely nothing in your negotiation. If you’re too afraid of such consequences, don’t read further because you are wasting your time. Go back to studying for your classes so that you can make lots of money after college to pay off all of the debts you incurred because you are too afraid to negotiate.

Remember that the downside of paying your lease that don’t want to pay is that you no longer have your money! Instead, your landlord has your money! Keep in mind that this is the landlord you believe is not owed any money based on the defenses to enforcement of a contract that you believe should apply. Seemingly, every payment you make is you losing and the landlord winning. If you’re willing to play the game of negotiation, please read further.

1) Offer the Landlord a Lump Sum for Termination

The most common technique to terminate a lease is to offer the landlord a lump sum of money in exchange for termination. Commonly, this involves the rental deposit plus two or perhaps more months of rent. This allows the landlord to re-let the property to hopefully mitigate their damages or even double collect if they can find a new tenant in a short period of time. However, it seems doubtful right now that the landlord will find a new tenant, at least while the campus remains closed and they require tenants to be students.

We have a letter online that you can use to draft your request for lease termination.

2) Don’t Pay Your Rent

Another common strategy is to not pay the rent that you believe should be paid given the frustration of purpose under California law resulting from the Coronavirus pandemic. Often times, creditors who understand that the debtor/tenant knows their rights and is not afraid to withhold payment will offer a better deal.

One downside is that the landlord may try to ding your credit report. However, it may be years until your credit score makes any difference, e.g. if you try to buy a home.

They may also try to obtain a civil money judgment against you. However, landlords are probably hesitant to file a civil suit given the obvious Coronavirus defenses to breach of contract that may be raised as well as the public relations issues related to suing students under these circumstances.

The bottom line is that you should not pay a creditor if you don’t have the money. You may want to prioritize your basic living expenses first.

Note that landlords are prohibited from filing an unlawful detainer right now due to the emergency Rules or Court in California absent showing a health and safety violation. This means they cannot change your locks or otherwise kick you out until the Rules of Court are changed.

3) Turnover the Keys

If you’re not coming back, it may be wise to turnover the keys. This creates a defense that the landlord must take reasonable steps to mitigate their damages. This defense may make the landlord hesitant to file suit given the expense of this defense.

With regard to Grandmark, Highlander at North Campus, UV Towers, and the Palms, students are welcome to try these strategies to obtain a better result than paying the full rate for a room they don’t need.

4) Find a New Tenant

Landlords have a duty to mitigate their damages, but not all landlords will show your empty unit if they have other empty units. Interestingly, UV Tower does not specify on its website that it rents only to non-students. It may be wise to propose to the landlord a specific tenant who wishes to move in, whether it be a student or not.

5) Don’t Worry About it Because Landlords Don’t Always Sue

6) Don’t Worry About it Because Landlords Don’t Necessary Ding Your Credit

7) If the Landlord Doesn’t File a Lawsuit for Breach of the Lease, they Can’t Take Anything from You to Pay Their Damages

A common question is whether the landlord can pay themselves their alleges damages from the property owned by a student or their parents without filing a lawsuit. The answer is that there is no way that any party without a security interest (e.g., a mortgage or car lien holder) can take property from you unless they first go to court and obtain a judgment signed by a judge stating that you owe money.

8) If the Landlord Files a Suit, They Can Only Get to Certain Assets

Even if the landlord obtained a judgment, their ability to collect can be difficult. First, they have to find your assets, such as your bank account. This might require a judgment debtor’s examination, which can be expensive, meaning that few creditors would go through such trouble if they are owed only a few thousand dollars.  Even if they located your assets, certain assets are exempt, such as recent earnings, social security, etc.

9) No, Landlords Cannot Have You Deported for Breaching a Lease

Sadly, there are rumors, sometimes spreads by landlords, that if you breach your lease, your status as foreign student at UCR will be in jeopardy. We are aware of no impact that breaching any type of contract would have on your immigration status in America.

10) Do Not Pay the GrandMarc or Other Landlord’s “Termination Fee” Unless You Have In Writing that the Termination is Approved

We are hearing that many students are paying GrandMarc a $700 termination fee under the belief that this terminates their contract. To the contrary, that fee is merely an assignment fee if you find a new tenant to take over your lease. However, we are hearing very few stories of anyone getting someone else to take over their lease.

11) Make a Calculated Risk

Let’s suppose the worst case scenario is that you owe $12,000 in rent plus $2,000 in attorney’s fees, and there is only a 10% chance that the landlord will ever file a lawsuit. That means that your risk is about $1,400. It is important throughout your life to make calculated risks, rather than living in fear of something that has only a limited chance of ever occurring or causing damage to you.

12) Stop Worrying about the Landlord Giving You a Written Termination of Lease That They Will Never Provide

At the end of the day, you may decide that it makes more sense not to pay the landlord and see what happens. If you do so, stop worrying about something you cannot control, namely whether the landlord will ever give you a written termination of your lease in exchange for some amount of money to be paid. The landlords are large, corporate organizations that have their own policies to further the primary goal for essentially every business: to make money.  These landlords may have concluded that they will make money by refusing to give anyone a lease termination, but instead hope that students and parents fork over their hard earned money for a rental they will not use based on their fear of being sued or having a ding on their credit. They are welcome to take this strategy, and you are welcome to move on with your life.

Draft Letter Terminating Lease

Without an understanding of the facts in your case, we are unable to provide you with legal advice on whether to terminate your lease. However, if you have decided to do so, below is an email you might want to send to your landlord:

Dear Landlord:

Please accept this notice of termination of the lease that I understand you allege I am bound to perform despite the Coronavirus pandemic occurring after the date of our lease.

Of particular concern is that I have not been provided with specific, written assurances that I will not contract COVID-19 if I move in to your student housing, the density of which is contrary to the advice of medical experts suggesting social distancing.

Absent evidence of my safety in your student housing, and coupled with the closure of the nearby UCR campus that your marketing materials made clear would be materially important for any tenant in your building, there has been a frustration of purpose.

Even further, as a landlord, you have a duty to mitigate your damages by accepting others to rent within the complex. Because the lease you had me sign did not designate any particular unit within your complex, if you lease any further unit, it is fair to assume that the unit you rented was my unit, meaning you have no further alleged damages against me.

Please understand that if I find that your office has filed suit or provided any negative credit report, I will vigorously pursue all remedies while also expressing my opinion about your business practices through all available online reviews.

Best Regards,

[Your Name]

Landlords are Playing Hardball and So Should You!

We’ve spoken to many sources who tell us that the landlords are refusing to agree to anything less than full rent. In the game of negotiation, this is called playing hardball. Or, perhaps, you might even call it insulting. It’s important for students to know how to play this game of hardball, as well. One of the most powerful tools you have is to not pay them, and let them know you are not paying them because you do not believe the rent is owed. Once they know that you know how to play the game, they will get serious about settlement.

This post is written by real estate attorney in Riverside Scott Talkov as part of Talkov Law’s commitment to pro bono service.

Thanks to Riverside City Councilman Andy Melendrez and students at UCR for inspiring this post.

Possible Rent Assistance

We have been informed that there may be rental assistance to individuals that have been economically impacted by COVID. They will pay a person’s landlord up to $3,500 to offset their rent.

To qualify, you must demonstrate how you have been impacted. For example, some students may have lost their jobs or lost family financial support. Under the expanded county guidelines, we understand that residents will no longer have to document being currently behind on their rent to qualify for rental assistance. Residents can qualify for rental assistance regardless of their income level. Students will need to demonstrate local residency – so if their driver’s license still shows their parent’s address, there may be challenges.

It won’t benefit all students that have signed leases, however it might help some. $3,500 would likely cover 3 month’s rent for most students. The website to apply is www.unitedlift.org – a partnership between the County of Riverside and the United Way of the Inland Valleys.

Students may want to send a letter to their landlords wherein the student offers to apply if and only if the landlord agrees to release them from any unpaid amounts not paid by United Lift.

Draft letter to a landlord proposing this outcome is below:

Dear Landlord:

Please be advised that UnitedLift.org, a partnership between the County of Riverside and the United Way of the Inland Valleys, may provide $3,500 if an application for rent assistance is approved.

I hereby offer to apply if and only if the landlord agrees to release me from any unpaid amounts not paid by United Lift.

Sincerely,

[Your Name]

Note: Not Everyone Agrees With This Analysis

The analysis in this blog post allows students to calculate the risk that anything will go wrong if they do not pay the landlord, including the use of such non-payment to attempt to negotiate a termination fee. Others recommend what they believe to be a “less risky” strategy that may involve paying the disputed rent to avoid, for example, the risk of a credit ding. We have not been provided with evidence that any student at these large, UCR-adjacent housing complexes has received a negative credit report as a result of non-payment. However, the risk of taking the so-called “less risky” advice that you should pay your rent to avoid these negative consequences is that you will have lost your money (it will be, with 100% certainty, in the hands of the landlord never to be seen by you again if you pay the rent that you think is not owed). Other organizations providing advice to students include Fair Housing Council of Riverside and Legal Aid of Riverside.

Our Exclusive Research Showing that Student Landlords near UCR Rarely (If Ever) File Suit for Breach of Contract

In any negotiation, it is important to size up your competition. What is it that your opponent in the negotiation will do if they do not get what they want? Our research, assisted by UCR Public Policy Undergraduate Student Sam Habibi shows that we could NOT locate any case in which the landlords near UCR filed ANY lawsuit for breach of a lease agreement other than an unlawful detainer to obtain possession. Instead, of the 122 lawsuits that we reviewed after finding them on the Riverside County Superior Court website, every case was related to unlawful detainers, which means that a student/tenant was evicted because they remained in possession, but were not paying the rent or perhaps were violating the rules of the building, such as getting into fights, damaging property, or being too noisy. So long a student turns over possession to the landlord, the unlawful detainer action must stop.

You are welcome to review these cases on the Riverside County Superior Court website to look for yourself to determine whether the landlords really file lawsuits because a student or their parent(s) did not pay rent in a case unrelated to obtaining possession (i.e., an unlawful detainer / eviction).

Summary of Talkov Law /UCR Public Policy Student Sam Habibi Research on Cases Involving UCR Area Landlords

Conclusion: Don’t be afraid of the boogeyman! If anyone is telling you to be afraid of UCR area landlords, ask them for any evidence that anything they claim might happen has ever happened in the past!

Civil Cases Filed Against Landlords Unrelated to Possession

Lawsuits Filed by UCR Area Landlords (All of Which Were Unlawful Detainer Cases to Obtain Possession)