Filed 1/4/17




                          CERTIFIED FOR PUBLICATION

               IN THE APPELLATE DIVISION OF THE SUPERIOR COURT

                    STATE OF CALIFORNIA, COUNTY OF FRESNO




CANDY SCOTT,                   )         Sup. Ct. Appeal No. 2574
                               )
     Defendant and Appellant,  )         Sup. Ct. No. 15CECL09273
                               )
v.                             )
                               )
SHEIKH KAIUUM,                 )
                               )
     Plaintiff and Respondent. )
                               )
                               )
                               )
        APPEAL from a judgment of the Superior Court of Fresno

County, Lisa Gamoian, Judge.       Reversed.1

        Attorneys and Law Firms

        Central California Legal Services, Inc., Marcos Seguro, for

Defendant and Appellant.

        Law Offices of Daniel A. Bruce, Daniel A. Bruce, for

Plaintiff and Respondent.

        Opinion

        GARY D. HOFF, J.




1
  This opinion was originally issued by the court on December 7, 2016. It was
certified for publication on January ___, 2017, which is within the time that
the appellate division retained jurisdiction. This opinion has been certified
for publication in the Official Reports. It is being sent to the Fifth District
Court of Appeal to assist the Court of Appeal in deciding whether to order the
case transferred to the court on the court‟s own motion under Rules 8-1000 –
8.1018.
                                         I.


                                   Introduction

        In this appeal from an unlawful detainer judgment, appellant

Candy    Scott   (hereinafter      “appellant”)      contends       that   the   trial

court erroneously granted judgment in favor of respondent Sheikh

Kaiuum (hereinafter “respondent”). She argues that the respondent

was not allowed to evict her for failure to pay the full amount

due under her rental contract because she was the beneficiary of

subsidized rental payments under 42 U.S.C.A. 1937f, Section 8.

She contends that the Fresno County Housing Authority had ceased

making Section 8 payments on her behalf due to the respondent‟s

failure to maintain the property in a habitable condition, and

thus respondent should not have been allowed to declare her in

breach of the rental agreement.

        We agree that it was respondent‟s conduct, not appellant‟s,

that    caused   the    Housing    Authority    to    cease    making      Section   8

payments, and that respondent was not permitted by law to recover

the unpaid amounts from appellant, or to declare her to be in
breach of the lease when she failed to make the full payments.

Therefore, we will reverse the trial court‟s judgment.

                                         II.

                                        Facts

        On January 14, 2015, appellant and respondent entered into a

one-year residential rental agreement with rent set at the market

rate of $700 per month.           However, a portion of appellant‟s rent
was     subsidized     through    the   Federal      Section    8    program.        In

accordance with Section 8 regulations, respondent and the Fresno


                                         -2-
 County      Housing      Authority       entered        into     a   Housing      Assistance

Payment    Contract        (“HAP      contract”),        which    required      the       Housing

Authority to pay respondent $684 of appellant‟s $700 per month

rent each month starting on September 1, 2015.                          The HAP contract

prohibited respondent from charging appellant more than $16 per

month.
       On October 27, 2015, the Housing Authority sent respondent
and appellant a letter stating that the property had failed a
recent inspection, and listing multiple violations of the federal
habitability standards, all but one of which were deemed to be
caused by the owner.                  The letter warned that there would be
another inspection on November 17, 2015, and that, if the defects
were   not    cured       by    the    time   of     that      inspection,      the    Housing
Authority would abate all further Section 8 payments effective
December      1,    2015,       and     the   HAP     contract        would   be      canceled
effective December 17, 2015.
       On November 18, 2015, the Housing Authority sent respondent
another letter, stating that the property had failed the second
inspection,        that    the      Housing   Authority         would   abate      Section      8
payments to respondent effective December 1, 2015, and that the
HAP    contract      would       be    canceled     on    December      17,     2015      unless
repairs were made before the cancelation date.                                There was an
inspection report attached to the letter that listed multiple
separate violations in appellant‟s unit and the common areas of
the    complex,      all       of     which   were       all    determined      to     be     the
responsibility of respondent owner.                      The letter also informed the
respondent that it was “not permitted to recover monies from the
resident.”
       Nevertheless,           when    rent   came       due     on   December       1,     2015,

respondent demanded that appellant pay the entirety of the $700

                                              -3-
rent under the rental agreement.                 When rent became past due on

December 4, 2015, respondent served appellant with a three-day

notice   to   pay     or   quit,   again    demanding          the    full   $700    rental

payment.

      When    appellant     did    not   pay     rent     or    leave    the   premises,

respondent filed his complaint for unlawful detainer on December

16,   2015.     Appellant      filed     her     answer    on    December      21,    2015,

raising defenses based on lack of habitability and violation of

the agreement with the Housing Authority.                            Trial was set for

January 12, 2016.

      At the trial, Judge Lisa Gamoian found that respondent had

failed inspections due to substandard conditions at the unit, and

that the Housing Authority had given notice that Section 8 rent

would not be paid to respondent if the violations were not cured.

However, the court found that, because the deficiencies were not

cured by the deadline, the Section 8 contract had terminated and

thus appellant was required to pay the full amount of rent under

the rental agreement.          Therefore, the court granted the unlawful
detainer judgment in favor of respondent and against appellant.

The   court    also    ordered     appellant       to     pay    past    due   rent    and

holdover damages of $1,242.96.              Appellant then filed the present

timely appeal.

                                         III.

                                    Discussion

      Standard of Review:          There are no disputed issues of fact,

so we apply the de novo standard of review to the trial court‟s
construction of the relevant statutes and ordinances, as well as

to the court‟s determination that the complaint states a cause of

                                           -4-
action.      (Naylor v. Superior Court (2015) 236 Cal.App.4th Supp.

1, 6.)

         Principles of Unlawful Detainer and Section 8 Law:                        Under

Code of Civil Procedure section 1161, “A tenant for a term less

than     life     is    guilty     of   unlawful      detainer    by    continuing      in

possession without the landlord's permission after default in the

payment of rent pursuant to the lease or rental agreement, and

after a three-days' written notice stating the amount due and

requiring the payment or possession of the property, has been

served on the tenant and subtenant, if any.                      (Code Civ. Proc., §

1161,     subd.    (2).)”         (Smith-Chavez,      Stratton    &    Trembath,     Cal.

Practice Real Property Litigation (2016) § 18:9.)

         Also, “Section 1161 of the Code of Civil Procedure requires

that the three-day notice must state „the amount which is due.‟

It is settled law that this section incorporates the common law

view that in order to work a forfeiture of a lease for nonpayment

of rent the landlord must demand the precise sum due, and that a

demand in excess of the judgment will not support the judgment.”
(Werner v. Sargeant (1953) 121 Cal.App.2d 833, 837.)

         In addition, since appellant was renting the unit under the

federal Section 8 program,               the respondent had to comply with

federal statutes and regulations related to Section 8 before it

could evict appellant.              “[T]ermination proceedings under Section

8's existing housing program are left by Congress and HUD to

state     law”    and      “the   landlord    can    institute    unlawful       detainer

proceedings in state court.”                  (Gallman v. Pierce, 639 F.Supp.
472, 478 (N.D.Cal.1986).) The regulations regarding termination

of   a    Section      8   lease    agreement       provide   that     tenancy    may   be

                                             -5-
terminated      for    serious       violation      of   the    terms      of    the    lease,

“including but not limited to failure to pay rent.” (24 C.F.R. §

982.310(a).)
             However,        under     the   HUD    regulations,      “The       owner    must
maintain     the      unit     in    accordance      with      HQS   [Housing          Quality
Standards].”       (24 C.F.R. § 982.404, subd. (a)(1).)                     “If the owner
fails to maintain the dwelling unit in accordance with HQS, the
PHA   [Public      Housing     Authority]      must      take    prompt     and       vigorous
action to enforce the owner obligations.                        PHA remedies for such
breach of the HQS include termination, suspension or reduction of
housing assistance payments and termination of the HAP contract.”
(24 C.F.R. § 982.404, subd. (a)(2); see also 24 C.F.R. § 982.453,
subd. (b).)
      “The PHA must not make any housing assistance payments for a
dwelling   unit       that     fails    to   meet    the     HQS,    unless       the    owner
corrects the defect within the period specified by the PHA and
the PHA verifies the correction.”                    (24 C.F.R. § 982.404, subd.
(a)(3).)
      Also, “Any of the following actions by the owner... is a
breach of the HAP contract by the owner: (1) If the owner has
violated any obligation under the HAP contract for the dwelling
unit, including the owner's obligation to maintain the unit in
accordance with the HQS.”              (24 C.F.R. § 982.453, subd. (a)(1).)
      Moreover, “The family is not responsible for payment of the
portion of the rent to owner covered by the housing assistance
payment under the HAP contract between the owner and the PHA.”
(24 C.F.R. § 982.310, subd. (b)(1), emphasis added.)
      Furthermore,           “The    PHA[„s]       failure      to   pay        the    housing

assistance payment to the owner is not a violation of the lease

                                             -6-
between the tenant and the owner.                   During the term of the lease

the   owner    may    not     terminate      the     tenancy      of    the    family    for

nonpayment of the PHA housing assistance payment.”                            (24 C.F.R. §

982.310, subd. (b)(2), emphasis added.)

      Application:       We    find   that     the      trial    court‟s      decision    to

grant judgment in favor of respondent and evict appellant was in

error.     First of all, under the HAP contract and HUD regulations,

appellant was only obligated to pay $16 per month of rent, not

the full $700 market rate rent pursuant to the rental agreement.

Thus, to the extent that the three-day notice sought to recover

the   full     $700   in      rent    from    appellant,         the    notice     greatly

overstated the amount of rent due.                      As a result, the three-day

notice was inaccurate and could not form the basis of a valid

unlawful      detainer      claim,    nor     could      it     properly      support    any

subsequent     unlawful       detainer      judgment.           (Werner    v.    Sargeant,

supra, 121 Cal.App.2d at p. 837.)

      Also, the judgment was in violation of the HUD regulations

that prohibit the owner from collecting the unpaid rental subsidy
from the resident when the Housing Authority abates the subsidy

payment due to habitability standard violations by the owner.

“The family is not responsible for payment of the portion of the

rent to owner covered by the housing assistance payment under the

HAP   contract    between      the    owner       and   the     PHA.”      (24   C.F.R.    §

982.310, subd. (b)(1), emphasis added.)                       “The PHA failure to pay

the housing assistance payment to the owner is not a violation of

the lease between the tenant and the owner. During the term of
the lease the owner may not terminate the tenancy of the family



                                            -7-
for    nonpayment      of    the       PHA    housing      assistance     payment.”             (24

C.F.R. § 982.310, subd. (b)(2), emphasis added.)

       Yet here, the owner served a three-day notice to pay rent or

quit    after    the       Housing        Authority        abated      Section       8    subsidy

payments    to       the    owner       due    to   the    owner‟s      violation         of    the

habitability standards under Section 8.                        There is no dispute that

the abatement was due to multiple violations of the habitability

standards,      or    that       the    violations        were   solely       caused      by    the

owner, rather than the tenant.                        Under these circumstances, the

owner was not allowed to recover the unpaid amount of rent from

the resident, and the Housing Authority‟s letter clearly stated

as much.     Thus, the trial court should not have found the tenant

to be in violation of the lease terms or granted judgment in

favor of the owner.               Nor should the trial court have found the

tenant liable for the unpaid rental amounts, which were based on

the full market rate rather than the remaining balance of $16

that was the tenant‟s responsibility.

       It appears that the trial court believed that it was the
responsibility        of    both       the    owner    and     the    tenant    to       cure   the

defects    in    the       unit,       and    that,    since     the    HAP     contract        was

terminated for failure to cure the defects, therefore the tenant

was    liable    for       the     full       amount      of   rent     under    the       rental

agreement.       However, as discussed above, the Housing Authority

found that the violations were solely caused by the owner, not

the tenant.      As such, the owner had no right to seek the balance

of the unpaid subsidy payment from the tenant.
       In addition, the November 18, 2015 letter from the Housing

Authority made it clear that, while the Section 8 payments would

                                                -8-
be abated effective December 1, 2015, the HAP contract would not

be canceled until December 17, 2015.                  Thus, the HAP contract had

not yet been canceled at the time the three-day notice was served

on December 4, 2015, or even when the unlawful detainer complaint

was filed on December 16, 2015.                As a result, even assuming that

the owner could have properly recovered the full market rate rent

from the tenant after the HAP contract was canceled, which it

could not, here the three-day notice and complaint were filed

before the contract had been canceled.                     Consequently, the owner

was not entitled to recover the full market rate rent of $700 per

month from the tenant, and the court should not have granted

judgment based on the failure to pay the full rental amount.

       Allowing the owner to recover the unpaid balance of the

Section 8 subsidy from the tenant when the Housing Authority had

canceled the payments due to the owner‟s failure to cure the

habitability         violations      would    also    be   inconsistent         with   the

intent of Section 8, which is to make it possible for low-income

tenants to obtain affordable, safe, and decent housing.                          (See 42
U.S.C.   1937f,       subd.    (a).)      Permitting       a   landlord    to    evict   a

tenant for failure to pay the full market amount of rent because

the    landlord        failed       to   remedy      basic     violations        of    the

habitability standards of Section 8 would reward the landlord for

its   bad     behavior,       and   perhaps    even    create     an     incentive     for

landlords to refuse to correct defects with their properties.

       There is a dearth of California authorities addressing this

issue, but we note that other states have consistently held that
an    owner    who    refuses       to   correct     violations     of    habitability

standards are not allowed to then either collect the full amount

                                             -9-
of rent from their tenants, or evict them if they fail to pay

full market rate rents.     For example, in 1212 Grand Concourse LLC

v. Ynguil, 2010 WL 183762, 894 N.Y.S.2d 713, 27 Misc. 3d 205, a

New York court found that the landlords could not evict their

Section 8 tenants when it was the landlords‟ failure to cure the

defective conditions of the premises that had caused the HAP

contracts to be terminated.        (1212 Grand Concourse, supra, 27

Misc. 3d at pp. 212 – 213; see also Sunflower Park Apartments v.

Denise Johnson (1997) 23 Kan. App. 2d 862; Soliman v. Cepeda

(1993) 269 N.J. Super. 151, 636 A.2d 1057.)

       While this court is not bound by the decisions of courts in

other jurisdictions, we agree with their reasoning that it would

defeat the intent of Section 8 and the HUD regulations to allow

the respondent landlord to demand full rent payments from the

appellant when it was the respondent who allowed the property to

fall into such disrepair that it fell below minimum standards of

habitability under federal law.       It would give the landlord no

incentive to correct such unsafe and unsanitary conditions if the
landlord could simply demand full rental payments from the tenant

when   the   Housing   Authority   cuts   off   the   Section    8   subsidy

payments.    In fact, it would reward the landlord for its own bad

conduct to allow unlawful detainer actions to proceed in such

circumstances.

       Furthermore, the respondent was also not entitled to demand

payment of rent under California Law because the conditions of

the rental unit violated Civil Code section 1941.1.             Under Civil
Code section 1942.4,



                                   -10-
(a) A landlord of a dwelling may not demand rent, collect
rent, issue a notice of a rent increase, or issue a three-
day notice to pay rent or quit pursuant to subdivision (2)
of Section 1161 of the Code of Civil Procedure, if all of
the following conditions exist prior to the landlord's
demand or notice:

(1) The dwelling substantially lacks any of the affirmative
standard characteristics listed in Section 1941.1...

(2) A public officer or employee who is responsible for the
enforcement of any housing law, after inspecting the
premises, has notified the landlord or the landlord's agent
in writing of his or her obligations to abate the nuisance
or repair the substandard conditions.

(3) The conditions have existed and have not been abated 35
days beyond the date of service of the notice specified in
paragraph (2) and the delay is without good cause...

(4) The conditions were not caused by an act or omission of
the tenant or lessee in violation of Section 1929 or 1941.2.

(Civ. Code, § 1942.4.)


Also, under Civil Code section 1941.1,


(a) A dwelling shall be deemed untenantable for purposes of
Section 1941 if it substantially lacks any of the following
affirmative standard characteristics or is a residential
unit described in Section 17920.3 or 17920.10 of the Health
and Safety Code:

(1) Effective waterproofing and weather protection of roof
and exterior walls, including unbroken windows and doors.

(2) Plumbing or gas facilities that conformed to applicable
law in effect at the time of installation, maintained in
good working order.

...

(6) Building, grounds, and appurtenances at the time of the
commencement of the lease or rental agreement, and all areas
under control of the landlord, kept in every part clean,
sanitary, and free from all accumulations of debris, filth,
rubbish, garbage, rodents, and vermin.

                          -11-
        ...

        (8) Floors, stairways, and railings                  maintained        in    good
        repair. (Civ. Code, § 1941.1.)


        Here, the conditions of the unit as described in the notice

of abatement served on respondent showed that the unit fell below

the standards of section 1941.1.            The abatement letter contains a

list of violations present in the unit that respondent failed to

rectify, including exterior doors with missing trim, loose shower

head,     improperly       installed   water     heater,       roach    infestation,

garbage and debris in the common areas, hanging barbed wire on

the    carports,    protruding      nails   on   boarded       up   units,     damaged

stairs,       and various other health and safety violations.                         The

Housing Authority served respondent with notice of the violations

on October 27, 2015, and warned respondent to fix the violations

or Section 8 payments would be suspended and the HAP contract

terminated.       Respondent refused to repair the conditions despite

having more than 35 days in which to do so.                    Finally, the letter

from the Housing Authority clearly states that the conditions

were caused by respondent, not the tenant.

        Respondent did not deny any of these facts at trial, nor has

respondent filed any opposition to appellant‟s brief on appeal,

so    respondent    apparently      concedes     that    the    unsafe    conditions

existed, that they were caused by respondent, that it had notice

of    the     violations,     and   that    it    failed       to   correct         them.

Therefore,       because     respondent     failed      to     remedy    the    unsafe
conditions at the unit after receiving notice of the violations,

respondent had no right to collect any rent from appellant during


                                       -12-
the period in which the violations went uncorrected.   (Civil Code

§ 1942.4.)

     As a result, the trial court‟s order granting the unlawful

detainer judgment against appellant and awarding damages against

her based on unpaid rent was erroneous.




                               IV.

                           Disposition

     Accordingly, the judgment is hereby reversed, and the matter

is remanded to the trial court with instructions to enter a new

judgment denying all relief to respondent.   It is so ordered.

     Dated this __ day of January, 2017



                         _____________________________________
                         Hon. Gary D. Hoff, Judge

     WE CONCUR:


                         _____________________________________
                         Hon. Donald S. Black, Presiding Judge
                         Appellate Division of Fresno Superior
                         Court




                         _____________________________________
                         Hon. Rosemary McGuire, Judge




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