February 2015

As seen in the December 2014 issue of Rental Housing, the publication of the East Bay Rental Housing Association.

“Do I have to allow an existing tenant to get a roommate? What if it is a studio apartment and he wants to get two roommates? Also, can I require applicants to pay an application fee and screen them?”

These are some very common and reasonable questions for any landlord. Since they are so distinct, I’ll break them down by topic.

Permissive Roommates

The question of roommates can turn into a very complex issue depending on the facts of a given tenancy. The short answer to the question is: no, you do not have to allow a tenant to get a roommate. As long as the apartment was only leased to one tenant there’s no one law saying you have to permit a second tenant (absent some extraordinary circumstances). Where the question can get complicated is when the tenant is replacing other tenants or sub- tenants.

There are a few preliminary issues with this question that need to be addressed—and many regular readers of this magazine will already know this issue—specifically, what does the lease say? Does the tenant already have a roommate he or she is replacing? And finally, what city is this property located in?

Let’s start at the end and work our way forward: If the tenant brings on a roommate without the landlord’s consent, the landlord’s remedy is to evict the tenant through the unlawful detainer process. One basis for a notice to evict is the breach of a material term of the lease. Many leases contain a provision forbidding assigning the lease or sub-letting. For example, the California Department of Consumer Affairs has a form lease which contains this provision:

6.  OCCUPANTS: Guest(s) staying over 15 days without the written
consent of OWNER shall be considered a breach of this agreement. ONLY 
the following individuals and/or animals, AND NO OTHERS shall occupy 
the subject residence for more than 15 days unless the expressed 
written consent of OWNER obtained in advance:
[  Tenant’s Name  ]

Provisions similar to this are common among most residential leases—in fact, you would have a hard time finding a written lease that did not state the names of the tenants and contain a provision barring the addition of other tenants. Terms like this are material because they are fundamental, substantial and significant terms of the lease. If your lease has a provision like this, you don’t have to permit a tenant to get a roommate. A tenant violating this term could be grounds for an unlawful detainer.

The substantial caveat is, if your tenant already had a roommate and wants to replace that roommate, you may have waived your right to enforce this provision of the lease. If an unauthorized roommate has lived in the unit for a significant period of time and you, as the landlord, knew about it and did nothing to enforce this provision, a court may decide that the term is not material since it has not been enforced and that you cannot deny your authorized tenant the ability to bring someone else in.

The same would apply to rent control jurisdictions with respect to the initial denial of permission. If you only have one tenant and he or she wants to add people to the lease, you are not required to permit the addition of new tenants. However, under various rent controlled jurisdictions, a tenant has rights with respect to replacing roommates, which includes a one-for-one replacement or a procedure for approving or rejecting replacement roommates. These matters can be complicated, especially if there is a rotating cast of tenants and the original tenant who signed the lease is no longer a resident. If you have one of these issues it is best to contact a lawyer to know your rights.

Application Fees and Screening

The short answer to your question regarding applicant fees is: yes, you can charge a fee. The fee for applications is governed by California Civil Code §1950.6. This law went into effect in 1996 and imposes a cap on the fee you can charge which readjusts every year. According to the California Apartment Association, the max fee is now $45.161 . This fee must be used for the actual costs incurred in gathering information about the tenant, which brings me to the second part of the question.

You, as a landlord, are absolutely allowed to screen the tenant. This usually takes the form of credit checks and an investigation into past landlord tenant relationships. Organizations such as the East Bay Rental Housing Association can help landlords screen tenants. One factor to consider is that there are certain guidelines when using a credit report as a basis for screening a tenant. For example, if you base your decision on a prospective tenant’s credit history you have to let the prospective tenant know of that decision in writing, the credit agency you used and you have to make available a copy of the credit report you obtained. (See CA Civil Code §1785.1, et seq.) Further information regarding the use of credit reports can be found on the Federal Trade Commission website at http://business.ftc.gov/documents/bus49-using- consumer-reports-what-landlords-need-know There are other issues that come into play when screening tenant—such as discrimination—but those are for another article.