California Homeowners Beware! Law Could Ruin You - Says Landlord Anne Kihagi

  SAN FRANCISCO - 11/09/2018 (PRESS RELEASE JET)

San Francisco legislators have earned a reputation for being notoriously anti-landlord and harboring a hefty political grudge against them. San Francisco and other extremist cities influence State legislature, resulting in laws like the California Health & Safety law that poses a sinister threat and potential loss of your property.

The law relates to cities filing constraints on owners’ buildings to halt the owners' potential financing when municipalities sue an owner for failure to timely resolve a repair. It can and has been used in very harmful ways as did San Francisco prosecutors in a case of black landlord Anne Kihagi. From her experience, Ms. Kihagi learned that abusive laws are being put in place without questioning from the rest of the state. This means that Californians must be vigilant, as these are state laws. As other cities see the exorbitant profits being made from misapplication of this law, they will likely follow suit, especially in Berkeley and possibly Oakland. Most at risk are minorities, such as African American, Latino and Asian landlords.

What is this law? 

For over a century, every American homeowner has known the potential threat of lis pendens when litigation arises. A lis pendens – or, a notice of pending litigation relating to the ownership or possession of real property – can be easily recorded in county records, immediately after the filing of a complaint. The process is generally utilized by prospective buyers who maintain that a seller has wrongfully backed out of a proposed sale, and it renders the property unmarketable as the litigation makes its way through the courts.

For the lis pendens to have effect, it must relate to a “real property claim,” meaning a dispute over ownership or possession.

But in California, there is a law that allows prosecutors to file lis pendens on your property without a “real property claim.” Essentially, if you allow that shed in your backyard to get behind on repairs, or if your tenants have run-down cars that can be construed as a nuisance, the City can file a lis pendens when they file a suit against you.

This magical waiver is under Health & Safety Code, Section 17992. The State of California’s intent in allowing this is to give notice of claimed health and safety violations:

“Any person who obtains an ownership interest in any property after a notice of pendency of an action or proceeding was recorded with respect to the property pursuant to Section 17985 or any other notice of a violation of this part... shall be subject to any order to correct a violation.”

The legislature could simply record the stated violation – “or any other notice of a violation,” per the law – and accomplish the same goal without clouding the titles of all the owner’s property during litigation. Yet the goal in invoking lis pendens is no longer utilitarian; it is to gain stronger – and unequal – bargaining power. It allows prosecutors to file without a claim of ownership interest, just to give future buyers notice of some violation that is likely already recorded on your title. There are, of course, ways to give notice with less harm to the owner. Given the foundations of the American justice system, this usage of lis pendens indicates the law’s pointlessness and abusiveness.

Is anything being done?

After mounting complaints, the legislature made changes in 1990. Under California law, a lis pendens “is a provisional remedy which should be applied narrowly.” A 1999 Appellate Court ruling agreed, stating that “the danger is too great that a lis pendens, which effectively renders the property unmarketable” will have an unjust influence on litigation. 

California courts should therefore be guided by strong policy concerns favoring a restrictive application of lis pendens. Courts have long recognized that "[b]ecause the recording of a lis pendens place[s] a cloud upon the title of real property until the pending action [is] ultimately resolved ..., the lis pendens procedure [is] susceptible to serious abuse, providing unscrupulous plaintiffs with a powerful lever to force the settlement of groundless or malicious suits.”

Now what?

Knowing all this, it’s natural to ask how prosecutors convinced the state legislature to pass this law. Why would they introduce such a convoluted mechanism in an area of law that is already prone to abuse, especially when there is a very simple way to accomplish the same result? And how long will it be until these troubling policies infect beyond San Francisco, or even California? 

This is a law that should be easily changed, and we urge each homeowner, even those who think this could not affect them: write to your Senator and ask that this code be immediately removed.

For more information on Anne Kihagi and West 18 Properties, visithttp://annekihagisf.com/