Landlords fight back over new S.F. law regulating tenant buyouts

Ten days ago Ordinance 225-14 took effect which was passed by the San Francisco Board of Supervisors in October that requires owners of San Francisco apartment buildings to provide specific disclosures to tenants when negotiating buyouts. A number of groups that represent property owners including the San Francisco Apartment Association (SFAA) have filed a lawsuit seeking to overturn the new ordinance. Although the law was designed for the purpose of preventing tenants from feeling pressured into signing agreements, it is argued that the new ordinance violates right to free speech and privacy rights for both tenants and landlords. A few key points for San Francisco apartment buildings owners:

  • Ordinance places your private information and private negotiations into public realm
  • Tenants have unilateral right to rescind buyout agreement for up to 45 days after agreement is signed
  • Creates significant liability for property owners if they enter buyout agreement
  • If a landlord misses any step in the document filing process they may now open themselves up to potential lawsuit from tenant, a nonprofit tenants' rights organization or the city attorney. 
  • If the landlord loses the case, they have to pay plaintiff's attorney fees. If the landlord wins the case, the plaintiff does not have to pay the landlord's attorney fees. 
If you are an apartment building owner in San Francisco and are working with a tenant regarding buyout or plan to in the near future I highly suggest consulting with a qualified attorney regarding this new legislation.