2
faith to coerce the tenant to vacate the unit in circumvention of the city’s
eviction laws. (§ 37.10(A)(i).)
Plaintiffs contend the amendment is preempted by Costa Hawkins
because it seeks to regulate the rent a landlord may charge on exempt
properties. The city contends and the trial court agreed that the amendment
at issue here is a valid exercise of the city’s authority to regulate evictions.
We agree that the amendment is designed to deter landlords from attempting
to avoid local eviction rules by imposing artificially high rents in bad faith,
and thus is a reasonable exercise of the city’s authority to regulate the
grounds for eviction, which is not preempted. Accordingly, we shall affirm
the judgment.
Background
In January 2019, the city adopted an ordinance adding section
37.10(A)(i) to the city’s rent ordinance, making it “unlawful for a landlord to
endeavor to recover possession of a rental unit that is exempt from rent
increase limitations under Section 37.3(d) or Section 37.3(g) by means of a
rent increase that is imposed in bad faith with an intent to defraud,
intimidate, or coerce the tenant into vacating the unit in circumvention of
Section 37.9(a), 37.9A, 37.9B, or 37.9C.” Under the new provision, “[e]vidence
of bad faith may include but is not limited to the following: (1) the rent
increase was substantially in excess of market rates for comparable units;
(2) the rent increase was within six months after an attempt to recover
possession of the unit; and (3) such other factors as a court or the Rent Board
may deem relevant.” (§ 37.10(A)(i).) A landlord’s violation of section
37.10(A)(i) may be asserted by either the rent board or the tenant. At the
same time, the city adopted an ordinance amending section 37.10B,
subdivision (a)(5), to add the same prohibited conduct to the definition of