Tenant Death: What California Landlords Need to Know

Jun 4, 2024

Attorney Edrin Shamtob from SNS Law Group recently joined a discussion with the Apartment Owners Association to discuss, “What does a California landlord do if a tenant dies?”

Transcript:
Welcome everybody! My name is Jeff Faller, president of the Apartment Owners Association, and today we are going to discuss death in a unit. This is good information to know—you wish it never happens, but it does. It happens to everybody, and I’m just glad that we all woke up this morning; not everybody did, right? So, it is a wonderful day, and we have things to be thankful for.

Apartment Owners Association

Our goal for you is to help you make and/or keep more money than you currently are making and keeping with the information that we provide. So, just trying to keep you up to date with all the different compliance issues and so much more—it’s so complex here in the state of California.

If you’ve never been a member before, we do have a money-back guarantee for your very first year, and you know it’s only $97, and you’re just going to be able to expense that anyway. But yeah, so we want to encourage you to join. There’s no per-unit fee either, and there are so many different benefits that we have.

We have a debt collection service, we have tenant screening reports—really, I haven’t found one where they have a live investigator report; I just haven’t found that. It’s so important for several different counties, big counties like L.A. County and a few others that just don’t show you the date of birth anymore, and it’s becoming increasingly more difficult to screen and really know who you’re dealing with.

Another thing we’re doing: we have the AOA trade show coming up on August 22nd. We will have over 20 different speakers and we’ll have over 150 different vendors that are there, and they’re all looking to help you manage your properties.

And before that, on the 27th, we do have a Bay Area Maximum Allowable Rent Increase livestream, so that’ll be something for you up in Northern California to attend. There’s also an event in August for those of you in Northern California. And then on July 11th, there’s an e-bike and e-scooter battery addendum that we’re going to be talking through. Lots of different things are going on.

Definitely like this video, subscribe, and set the notification bell because sometimes we are putting out information that’s not on a livestream. And if you are watching from the AOAusa.com website, you can get this information on YouTube at AOA USA—that’s our channel. So, you can get it there.

And some stuff you may have missed—probably that urgent update to California criminal reports. So, I highly, highly suggest watching that one. Go to the YouTube channel, or I believe it’s in your member account as well, so get that one. And then also another one on tenant screening about knowing your rights as a housing provider and what you can and can’t do. So anyway, lots of different things are there for you.

Guest Speaker: SNS Law Group

Today, our speaker is the Senior Attorney at SNS Law Group, and he brings over 10 years of experience in real estate law, business transactions, and corporate formation. He has a robust background in litigating various disputes for both plaintiffs and defendants, including breach of contract, fiduciary duty, partnership and shareholder issues, unfair business practices, and trade secret misappropriation.

And of course, the landlord-tenant stuff that many of you are tuned in for. His combined legal and financial expertise enable him to handle complex real estate, financial, and business disputes and provide insightful counsel on intricate business transactions. So, it’s really my pleasure to welcome Edrin Shamtob with us.

Edrin Shamtob, Esq.

Hi, Jeff. I’m doing great. Thank you so much. Always lovely to be here with you and the Apartment Association and all your members. I always look forward to the days where I could swing by and help update people on new areas of landlord-tenant laws and maybe some old areas of landlord-tenant laws that keep coming up and causing people problems. Try to give them some guideposts to help them out, deal with sticky situations.

You know, I’ve been on with you countless times at this point, and I think today’s topic is the most morbid of all. But it’s something that, actually, surprisingly, comes up quite a bit. You know, we represent a lot of landlords here, and deaths in units—both from the perspective of its impact on the tenancy itself and also future obligations of the landlord—it actually comes up a lot. So, I have a PowerPoint that’s hopefully a bit educational. I’m just going to share my screen here so your viewers can follow along.

SNS Law Group, LLP

My office focuses mainly on real estate litigation, a big part of that being landlord-tenant law. We also do some business litigation as well, but the primary focus is trying to represent and advance the interests of landlords, your members. So, let’s dive in.

Tenant Death in a Rental Unit

The topic is “Death in the Unit: What California Housing Providers Need to Know” about various aspects of situations where a tenant dies in a particular unit.

Sole Occupancy

I want to start out with a distinction between a situation where you have a death where the deceased tenant is the only resident in the unit, because that’s going to have an impact. If one person dies and they’re the only occupant versus one person dying and there are other occupants. So if you have a situation, you landlords out there, where the tenant is the only, sole occupant and that person unfortunately passes away in the unit, there are certain things that you should be aware of.

There’s a further distinction between whether the tenancy is in the middle of a term—meaning you executed a lease agreement with the tenant and you’re in the middle of that one-year term—versus a situation where the tenant is on a month-to-month. This is actually a pretty big distinction.

Month-to-Month Tenancy

Now, if the tenant passes away in the unit and the tenancy is month-to-month, it automatically results in the termination of the landlord-tenant relationship. There is no longer a tenant on the other side of the contract to perform obligations or to withhold possession of the property.

The most important aspect that you should be aware of if there is a sole deceased tenant in the unit and it’s a month-to-month situation is that the tenant’s estate has no claim to possession. The tenant’s children and heirs have no claim to possession. And this also applies to rent-controlled properties.

Let me tell you how it’s come up in my practice. I’ve had situations where, of course, most of my clients own properties that are RSO properties, that are rent stabilized properties, and those are valuable to the tenants because the rental values are depressed. What I’ve seen is, when a person passes away, and all of a sudden, a cousin, or a third child, or a mother or a father of the deceased comes out of the woodwork and tries to access the property and tries to gain possession.

They do so to fall into the low rents under the RSO. There is no legal obligation for the landlord in that type of situation, where the sole tenant who occupies the property has passed away, for there to be any continuance of the landlord-tenant relationship—none whatsoever. If you see other people trying to enter the unit to gain possession, you need to take immediate action to file an eviction action. Because if those people come in and somehow you start accepting rent, that’s going to create a new tenancy situation with those family members.

If someone passes away on a month-to-month tenancy, that terminates the rental contract and any further obligations.

Tenancy Is Not Month-to-Month

Now, if the tenancy is not month-to-month. That means if they’re in the middle of a one-year term. And the tenant passes away, that does not automatically terminate the lease agreement or the landlord-tenant relationship. What happens is that the estate of the deceased person fills the shoes of the deceased tenant.

Now, that doesn’t mean a representative of the estate can come in and start living in the property. What that means, and it’s actually a benefit for the landlord, is that the estate would continue having the monetary obligations under the lease agreement. So, if there are nine months left on the lease agreement and you’re charging the tenant three grand a month, the estate has an obligation to continue paying for the duration of the period of the lease. Of course, the landlord has a mitigation obligation, which means once the tenant passes away and you regain possession, you have an obligation to try to re-rent the property in order to mitigate the damages for the estate. But you can actually go after the estate for the balance of the rental period.

That’s the crux of what happens initially when the sole tenant passes away.

Now, if the tenant is not the only tenant—in other words, there are other occupants in the unit—before I start into that…

Steps Landlords Should Avoid When a Tenant Passes Away

These are the steps that a landlord should avoid taking right when the tenant passes away. I’ve had situations where my client, a landlord, has a deceased tenant and the person is unfortunately wheeled out of the property in an ambulance or something like that. The landlord goes in and changes the locks immediately.

Well, funny enough, that will constitute an illegal eviction—you’re not allowed to do that. The only time you can go in and reclaim possession is under one of three scenarios: Number one, the estate representative comes to you and says, “We’re removing any claim of possession that we have.” They send you something in writing saying they’re no longer interested in the property, the property’s yours. In that event, you can go in, change the locks, and re-rent the property to someone else.

If there’s no one to communicate with—which is usually the case because you don’t know if they have a trust, an estate representative, or any family members—and 30 days have passed since the last rent payment, you can issue a Notice of Belief of Abandonment. That’s available to you if the person has passed away. Of course, you can’t mail or personally serve the Notice of Belief of Abandonment because the tenant has passed away. So, what you should do is fill out the Notice of Belief of Abandonment and post it on the property. If you do that and wait the requisite number of days—off the top of my head, I think it’s 18 days—and you don’t hear anything from anyone, at that point, you have authorization to regain possession and change the locks.

Finally, you could file an eviction action and go to court and tell the judge and/or jury that the tenant has passed away, and on those grounds you’re seeking to reclaim possession of the property. Do not go in there and change the locks immediately after the tenant passes away. All of a sudden, you’re going to get hit with a lawsuit from a family member or an estate representative saying that you illegally evicted the deceased tenant. Don’t do that.

Impact of Death of an Existing Tenant(s)

If the deceased tenant is not the only tenant residing in the unit, the remaining tenancy continues without interruption—it’s as though nothing has really changed. The one material aspect that may change is that the remaining tenants are obligated to continue paying the full rent; they don’t get a discount because one of the occupants has passed away. But for all other intents and purposes, the tenancy continues without interruption as though that tenant has not passed away.

Personal Property

Personal property—I also see this come up a lot. What do you do with the tenant’s personal property if they pass away?

If you know they have an estate representative, an executor of the estate, you should make contact with that representative and arrange for them to come pick up the items. If you’re not aware of any representative or any family member, you can treat the property as abandoned and you have to follow the Notice of Abandonment procedures and the Notice to Reclaim Abandoned Property. That’s a notice on a piece of paper. You could probably find it on AOA’s website as well, where you fill it out.

You cannot personally serve this on the tenant because the tenant has passed away. What you have to do is post it on the property and wait the requisite number of days. If you don’t hear anything from anybody, you’re free to dispose of the personal property if the personal property is less than $700. If it’s less than $700, you can just junk it. If you reasonably believe that the property is worth more than $700, for instance, if they have expensive bicycles, computers, furniture, gold, cash, and so on, what you’re actually obligated to do, you have to auction the personal property off.

You can deduct the expenses you’ve absorbed to facilitate that auction, and you take the differential and pay it to the state of California. If they have a bunch of expensive things, do not junk those expensive things because you’re going to expose yourself to a lawsuit from the estate down the line.

Security Deposit

With respect to a security deposit, what do you do with the security deposit once the tenant passes away? The situation is conducted as though the tenant’s tenancy has just terminated. You follow the same security deposit itemization requirements as you would in a situation where the tenant vacates the property. You go in, assess for damage, and if there’s no money left over, you can actually bring a claim against the tenant’s estate in probate in order to get your money. Most of the time, that’s impractical; you’re not going to hire a lawyer to make a probate claim for a couple of thousand dollars.

Now, if there’s money left over after the deduction, you have to issue the balance of the security deposit to the estate representative. If you don’t, you could be on the hook for twice the amount of the security deposit under Civil Code Section 1950.5. So, make sure you’re accounting for the security deposit as you would under any other situation when a tenant vacates the property.

California Landlord Disclosure Requirements

Finally, what are your disclosure obligations? Suppose the tenant passed away in the unit. You’ve regained possession, changed the locks, and now you’re marketing the property for re-rental. If the tenant passed away in the unit—not in the common areas or on the sidewalk, but in the unit—you have an obligation to disclose that death to any prospective tenant for a period of three years after the death.

If you regain possession and it’s been a couple of months and you’re trying to re-rent it, you have an affirmative duty to disclose that death to any prospective tenant. After three years, you don’t have any affirmative obligation to make the disclosure, but if a prospective tenant asks you about it—asks, “Hey, has anyone died on this property in the past,” you have an obligation to be truthful. You can’t conceal that fact, because under California law, that fact is a material term, and you have to disclose all material terms to any prospective tenant.

I think that’s all I have on this subject. I hope you guys don’t have situations where your tenants pass away, but if you do, hopefully, the information I shared with you today will help guide you through the process of reclaiming possession and understanding your disclosure obligations.

Question and Answer

Jeff Faller
Great, look at that—10 minutes flat. Perfect. Thank you so much, Edrin. Short and sweet. If you have a question, now would be the time… if you have a specific question about this, you can put it into the chat. There’s the blue help button at the bottom; just put it in there. If you’re on YouTube or Facebook, go ahead and put the question in, and we can pick that up.

You guys are going to be at the AOA trade show, right, Edrin?

Edrin Shamtob
We are, we are. We’re always excited to be at the trade show. I hope I have a speaking spot. I really love speaking in person because I get to meet people, talk about their specific situations, and try to help educate them on new areas of law, and some sticking points

Jeff Faller
Yeah, I don’t know if people understand, you guys are there all day long. So, not only is there speaking, but you’re there where people can ask you questions and that’s just one of those perks of going to the trade show.

Adult Child Who Was a Minor When Unit Originally Rented

Q:
When referring to remaining tenants after a death, explain how to handle a now adult child who was a minor when the unit was originally rented.

A:
Edrin Shamtob
It’s an excellent question. I’ll assume a few things for the sake of the question. I’ll assume it’s an RSO property. I’ll assume that it’s an L.A. City RSO because different RSOs have different requirements for minor children who have reached the age of majority while residing in the unit.

So what the RSO says is that if there’s a minor child, even if they’re not a signatory to the lease agreement, if they’re classified as an occupant, or even even if they’re not classified as an occupant but they reside in the unit—they are tenants under the RSO.

So if the parent passes away and the minor child who is now an adult resides in the unit at the time of the death of the parent, the tendency continues. It does not result in the extinguishment of tenancy rights or landlord-tenant relationship. The tenancy continues as though the person didn’t pass away.

Now, of course, the child, the adult child in this situation, is going to be required to satisfy all of the obligations of the household including the rent payment obligation. But you cannot terminate the tenancy and you cannot get possession back for the death of the parent.

Auction vs. Estate Sale

Q:
Instead of an auction, can you have an estate sale?

A:
Edrin Shamtob
I think the statute requires an auction. Specifically, in the statute. So you have to follow the statute provisions. And it specifically states an auction, so I don’t think you can have an estate sale.

Clarify $700 Value of Personal Belongings

Q:
Is $700 for total of items or individual?

A:
Edrin Shamtob
It’s $700 for the total of all items combined together. Most of the time, I haven’t seen too many situations where the personal belongings exceeds a reasonable estimate of $700. But if it does, it’s for all collected personal belongings in the unit.

Family Access to Unit After a Death

Q:
If death of a tenant, if family contacts owner, do we have to let family in the unit while they sort out who will be authorized person?

Let’s say the family contacts the owner and they want access to the unit, do you give access before they have someone who is authorized?

A:
Edrin Shamtob
You do not. No. It’s actually an excellent question. You do not. What you tell them is that you need a letter, something official from the executor or the representative of the estate in order to let anyone into the unit to claim personal possessions or anything like that.

Because otherwise, you’d be exposing yourself to liability. Let’s say someone comes out and lies to you about being a family member and they go in there’s a ton of cash sitting in the unit and the person runs off with it. No, you have no obligation to grant them access unless you get something official from the executive or the representative of the estate and I would highly suggest against giving access.

Jeff Faller
All right, so no removing personal items there.

Section 8 and Death of a Tenant

Q:
Does Section 8 have any other requirements?
A:
Edrin Shamtob
No. Well, no, it falls under the same general principles that I talked about earlier. If the tenant is the only tenant, and it’s a month-to-month—which a lot of tenancies are—it’s going to result in termination of both the underlying lease agreement and it should also result in termination of the Section 8 agreement, or the HAP contract.

They’re not going to continue paying once they get notice of the occupant’s death.

Return Deposit to CA State or Estate?

Q:
Did you say that return deposit to California state or estate of the dead person?

A:
Edrin Shamtob
No, it’s a return to the estate. So the executor or the personal representative of the estate because the estate fills the shoes of the deceased tenant. So if you have a $3,000 security deposit, you go in there and you see there’s $2,000 of damage, there’s a $1,000 balance in the security deposit, you have to send it to the estate because that’s who fills the shoes of the deceased tenant.

SNS Law Group Serves Southern California

Q:
What area do you serve specifically

A:
Edrin Shamtob
We serve all of Southern California. So we run all the way from Ventura County, all the way up to Orange County. I should say down to Orange County. Our main focus is obviously LA, City of LA, County of LA, Santa Monica, but we do it all the way up and down Southern California.

Note from Tenant Regarding Belongings

Q:
I have an authorized note from the tenant that her son may remove her belongings when she dies. Is that okay?

A:
Edrin Shamtob
You have an authorized note, and I suspect, hopefully it’s notarized. It’s a complicated question because really what that is, it’s a will substitute, right? So instead of the tenant having a will that specifies the manner in which the personal belongings have to be distributed to potential beneficiaries and heirs—the answer is maybe.

If it satisfies the will requirements under the California statutes, the probate statutes, it may be sufficient, but I would say that the family member still has to give you something from the representative of the estate.

I suspect that that family member in your situation, the grandson, or the child, is going to be named as the executor, but it really depends on the validity of the authorization.

How to Find Out Who the Executor Is & Notice of Belief of Abandonment

Q:
How do we find out who is the executor?

A:
Edrin Shamtob
It’s an excellent question. Actually, the executor has an obligation, has a statutory obligation, to reach out to anyone who had dealings with the deceased. Particularly creditors. And in this situation, the landlord would be a creditor because they’re entitled to the rent payments. They have an obligation within 30 days of the death in order to issue personal representation letters to any creditors and landlords. So they should be getting in touch with you.

Now, if no one gets in touch with you, what you should do, you should follow the procedures for a Notice of Belief of Abandonment because in that situation, of course they’ve abandoned it, they’ve died. But if you follow those procedures, you could do the Notice of Belief of Abandonment, if you don’t hear anything back within the 18-day period then you’re allowed legally to go in there and reclaim possession without the need to file an eviction action.

It’s actually an expedited procedure. So you’ve got to follow the Notice of Belief of Abandonment procedures.

Jeff Faller
What are some things to help keep people from being duped on that? Because someone could come in and say that, saying that they’re the executor.

Edrin Shamtob
Typically it requires a court order. Someone can’t self-designate and we’re traveling a little bit into probate and state law and all of that, which is fine, I’ve done a ton of those cases too.

Usually what they do is that they have to file an application with the Superior Court in order to get confirmation of their designation as a personal representative. So they’ll go to court and they’ll take the will or the trust document and they’ll go to court and they’ll say, “I’m designated as a personal representative, give me an order confirming that I’m the personal representative.” And they should be able to give you that order.

Family Members Staying in the Home of the Deceased Tenant

Q:
If the deceased tenant has a family member staying in the home while they are ill and the family member stays after deceased, how do you recommend going about resolving the situation?

A:
Edrin Shamtob
They’re a caregiver. It’s a sticky situation. I’ve actually seen that happen probably half a dozen times. When they’re elderly, they’re sick, they’re old, and a caretaker—either a family member or a licensed nurse or something like that—comes in and starts residing with them.

I would immediately take the position, immediately take the position, that they have never been a tenant under California law, or the lease agreement, and they have to immediately vacate. Because what they’re going to try to do, and I’ve seen this before, they’re going to try to hunker down and establish tenancy rights.

The question of whether or not they’ve already established tenancy rights, that depends on what happened before the death. Did they notify you that this person was living there, did you accept rent with knowledge of their occupancy. If you did, if they disclosed it to you and you accepted rent, they might come in and say you waived it by acquiescence. That you basically said okay by accepting the rent and letting them stay there. So it really depends on what happened beforehand.

Now, if you have no knowledge whatsoever of the caretaker living there, I would immediately take the position that they’re an unauthorized occupant, they have no right to occupancy or tenancy, and file an eviction action to get rid of them.

What to Do with Deceased Tenant’s Pet

Q:
What to do if a tenant who passes away has a pet?

A:
Edrin Shamtob
I’ll tell you, the state is going to care for it. Because when you call the paramedics, or the police, or whoever you call if you discover that someone has passed away, they’ll remove the animal from the unit. That’s not your obligation to take care of the pet.

Closing Remarks

Jeff Faller
We really do appreciate you. I check on your reviews now and then and you’re still like all five stars last time I checked, which was like last month. So, keep up the good work.

Edrin Shamtob
We take a lot of complicated cases on and try to find creative solutions. I’m glad that we’ve been able to do some good work for your members. We’ve had a lot of AOA members over the last two years. We have not, and I could say this openly right now, we haven’t lost a single case.

Jeff Faller
Great, congratulations. I know you work extremely hard.

Edrin Shamtob
Thank you so much, I appreciate it.

Jeff Faller
Thank you everybody. We’ll be right back next week. We got a lot more good content coming up and I’m sure we’ll have Edrin back on too. Thanks everyone, have a great day.