In Boston LLC v. Juarez, (2016) 245 Cal.App.4th 75, the court held that it was not proper for a landlord to terminate a residential tenancy and evict a tenant under a three-day notice based on the fact that the tenant failed to obtain renter’s personal injury and property damage insurance, as required by the lease. The court further held that in order to enforce a forfeiture provision in a lease, the tenant’s breach must be “material”, i.e., substantial, even if the forfeiture provision does not require a breach to be material. In this case, the court reasoned that the breach was not material because the insurance requirement only protected the tenant’s interests, not the landlord’s, and because the landlord otherwise failed to prove how it was harmed by the tenant not obtaining renter’s insurance after having lived at the premises for 15 years without this term being enforced.
The lesson that landlords should glean from this case is that a lease provision stating that any violation of the lease by the tenant is cause for the landlord to declare a forfeiture or otherwise terminate it is not necessary sufficient to justify a termination, but rather, the actual violation must be “material”. Furthermore, it is probably not sufficient for the parties to agree in the lease that all terms are deemed to be material. Landlords should be prepared to argue how a breach of a lease term is “material” because of the significant, actual or potential harm caused to the landlord.
©2016 Miles J. Dolinger. This article is not intended to and does not constitute legal advice or a solicitation for the formation of an attorney-client relationship.
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