Los Angeles Landlords Win A Major Battle Against The Unconstitutional Systematic Code Enforcement Program

Dated: 04/03/2019

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If you own rental units in the City of Los Angeles, you are probably familiar with the cumbersome inspection process called the Systematic Code Enforcement Program (SCEP).

 

The ostensible purpose if this program is to ensure that tenants who reside in rental units in have “safe, livable space, that meets requirements set forth in the California Health and Safety Code”. 

 

Under this program, the Housing Community Investment Department inspects the interior and exterior of rental properties approximately every 4 years to ensure compliance with state and local health and safety codes.

 

The city is looking for “substandard” conditions. Common things they look for are peeling paint, water damage, broken locks, worn out cabinets, ripped carpeting, cracked tiles, lack of smoke and carbon monoxide detectors, lack of security lighting, broken doors, exposed or unsafe electrical wiring, and any other structural defects that the inspector notices. They also check for things like unpermitted structures, any unapproved use, garage conversions, unpermitted bathrooms, apartments that have been divided up, and lack of a proper heating system in a unit.

 

Inspectors almost always find something wrong. Tenants are also often happy to point out any deficiencies in their unit to the inspector. Once the inspection is complete the inspector will itemize needed corrections and mail you a laundry list of required repairs along with a re-inspection date where they come back out to verify the repairs are complete. And don’t forget, the owner has to pull and pay for permits for any repairs that require them (like electrical) so that adds to your cost and hassle.

 

The initial inspection and the first two re-inspections are covered by the $43.32 SCEP fee, which as the Los Angeles Municipal Code states, is imposed on landlords, and can be passed through to the tenants, to pay for these inspections.  Any additional inspections that are required are paid for by the landlord, at a cost of $201.50 per inspection.

 

Many rental property owners feel that this is an intrusive income-generating endeavor to fill the city’s coffers.  The SCEP fees alone that are charged to landlords and tenants, which again are imposed specifically to pay for these inspections and nothing else, generates some experts say approximately $29 million per year. 

 

These needless inspections can be very problematic and costly to rental property owners. As an apartment broker in L.A., I have seen many of my clients caught up in the system.  This results in them having to fork over thousands of dollars for repairs, permits, and re-inspection fees to satisfy the whims of a city inspector, most of which are unqualified to do these kinds of inspections. The most vulnerable owners are senior citizens, owners who may not speak English fluently, and owners who may have health, emotional, or other mental issues.

 

As a broker for 34 years, I have known many rental property owners that were ensnared in the Systematic Code Enforcement Program.  It is usually the elderly or health challenged owners who have had the most problems.  One of my clients was a Vietnam Vet with PSTD on medication and the challenge of dealing with the bureaucracy almost put him in the hospital.

 

As if all of that is not enough, the city has the power to arrest owners or even tenants, as per the Los Angeles Municipal Code section below.

 

Description: ookmarkSEC. 161.410.  ARREST AUTHORITY.

   (Title and Section amended by Ord. No. 185,644, Eff. 7/6/18.)

 

   A.   Arrest Authority and Immunity.  In the performance of his or her duty, the General Manager shall have the power, authority and immunity of a public officer or employee as set forth in California Penal Code Section 836.5 and to make arrests without a warrant whenever he or she has reasonable cause to believe that the person to be arrested has committed a misdemeanor or an infraction in his or her presence in violation of an ordinance or statute which the employee has the duty to enforce, including: Sections 12.21 A.1.(a), 12.21 A.4.(m), 12.21 A.8., 12.21 C.1.(g), 80.01.191.109.1, 91.310.4, 91.610391.610991.8102.291.8104, and 91.8603.1.1 of this Code, or a violation of California Penal Code Sections 556 or 556.1.

 

   B.   Written Notice to Appear.  In accordance with Section 11.06(b) of this Code, in cases where a person is arrested pursuant to this Article and does not demand to be taken before a magistrate, the public officer or employee making the arrest shall prepare a written notice to appear and shall release the person on his or her promise to appear as prescribed by California Penal Code Sections 853.5 and 853.6.  If the person signs the written notice to appear, thereby promising to appear, he or she shall not be taken into physical custody.

 

The city means business and they have police powers to enforce their regulations. Until recently, owners and tenants did not have the right to refuse SCEP inspections without being subject to criminal penalties and fines.  This results in all consent to these inspections, or searches if you will, being coerced, and invalid.

 

Fortunately, many owners and even tenants are fighting back against what they believe is an unconstitutional law. On February 22, 2017, a class action lawsuit was filed against the city.  There are class representatives for landlords and tenants who have had to endure these unconstitutional inspections or searches, which violate their Fourth Amendment rights, and have had to literally fund the violation of their rights by paying the SCEP fees.  This has resulted in the City being unjustly enriched to the tune of hundreds of millions of dollars over the course of the program, which was enacted in the early 2000’s.

 

Here is what the plaintiffs are asserting in their suit:

 

All SCEP inspections violated the Fourth Amendment because all consent to such inspections is coerced through threats of criminal penalties and fines under the Los Angeles Municipal Code.

 

Additionally, because the inspectors are vested with full police power and can search for evidence of any crime, the searches are not just part of an administrative scheme, and therefore violate the Fourth Amendment under well-established case law.

 

Finally, the City was failing to provide a landlord or tenant with pre-compliance review before a neutral decision maker if consent to the inspection is denied.  When a landlord or tenant refused to allow the inspection or search of their home, the could be fined and deemed guilty of a misdemeanor violation.   

 

Due to the lawsuit that was filed in 2017, the City has amended its municipal code to provide for pre-compliance review when entry is denied, and before any penalties can be imposed.  However, the lower court failed to award the Plaintiffs, which include all landlords and tenants who have paid the SCEP fees to fund the unconstitutional searches, a refund of those SCEP fees.  Therefore, the case is going up on appeal to the 9th Circuit in attempt to prevent the City from being unjustly enriched from the millions of dollars it’s has collected to fund the inspections that violated each and every landlord and tenant’s constitutional rights, who have been subject to them. 

 

Ordinance 185644 amended the existing code to allow rental property owners and their tenants the right to object to a city inspector entering their premises.

 

Here is the pertinent language regarding the right to object to inspections contained in the new ordinance Sec. 161.601 Part C. Download a copy of the entire amendment here http://freepdfhosting.com/68d1127fc1.pdf

 

 

SEC. 161.601. RIGHT OF ENTRY

 

Part C            Right to Object to an Inspection - The property owner/landlord and tenant may object to the inspection notice by seeking pre-compliance judicial review.

 

Part C1          Pre-compliance judicial review shall be sought at least ten calendar days before the inspection date provided on the inspection notice in any Court of competent jurisdiction located in the City of Los Angeles.

 

Part C2          A person seeking pre-compliance judicial review of an inspection notice shall follow the applicable rules of court, including, but not limited to, the time for providing notice to the Department and content and service of the notice.

 

Part D                        Inspection Warrant –

 

Part D1          If consent to conduct an inspection is refused or cannot be obtained, the General Manager shall secure entry to inspect the premises by getting an inspection warrant under California Code of Civil Procedure Sections 1822.50 through 1822.57.

 

Part D2          A notice that an inspection warrant has been obtained shall be served by the General Manager on the property owner/landlord or tenant at least five calendar days before the warrant is set to be executed, unless the judge finds that immediate execution is reasonably necessary in the circumstances shown.

 

Part D3          The notice that an inspection warrant has been issued shall include the name of the judicial officer who issued the warrant and his/her address or department

 

Part D4          Before the date the warrant is set to be executed, the property owner/landlord or tenant may seek judicial review of the inspection warrant before the judicial officer who issued the warrant.

 

Part E             Exigent Circumstances

Notwithstanding the foregoing, if the General Manager has reasonable cause to believe that a residential rental property, building, unit, structure, or common area subject to this Article is so hazardous, unsafe or dangerous as to require immediate inspection to safeguard the public health or safety, the General Manager shall have the right to immediately enter and inspect the premises by use of any reasonable means to effect entry.

 

 

What this means in layman’s terms is that you and or the tenant can object to granting access to the city inspector.  Most tenants do not want to open their door to some nosy inspector banging around their unit.  It’s a hassle for them especially if they work during the day.

 

By refusing access, you force the city to obtain an “administrative warrant”. From the www.definitions.uslegal.com website:

 

“An Administrative warrant is a warrant issued by a judge upon application of an administrative agency.

 

For example, a warrant for an administrative search. Administrative agencies with enforcement power often seek administrative warrants to check for contraband or other evidence of non-compliance with the law”.

 

Will the city actually go through the process of getting a judge to actually sign an administrative warrant in order to inspect your building?  Who really knows at this point?  But common sense says that they won't have the money, time, or manpower to spend resources to do this especially if owners refuse en mass to not cooperate with these unconstitutional inspections

 

Here is the new language that now appears on the new SCEP inspection notices the city sends out:

PRE-COMPLIANCE JUDICIAL REVIEW AND RIGHT TO REFUSE ENTRY: You have a right to seek pre-compliance judicial review of this inspection notice without threat of imposition of any fine or penalty and/or refuse entry into the premises for this inspection in absence of an inspection warrant issued by a judge. Refer to the LAMC Section 161.60] for more information.

You can download a sample copy of the updated City Inspection notice with the new verbiage here: http://freepdfhosting.com/70434a1b34.pdf.

 

You can download a copy of the lawsuit here: http://freepdfhosting.com/57cd4028e1.pdf

 

Note from Derrick Ruiz Real Estate Broker

 

What should you do when you receive an inspection notice from the city?  Well I plan on objecting to the inspection and will refuse access.  Let them get an administrative warrant.  Perhaps they will forget about it and go on to the next owner who is ignorant to the changes in the muni code.  I can't blame owners for not knowing this.  It’s not the like the city is going out of their way to not publicize the changes in the code.  I’m sure they will just continue to bully people like always and hope they next owner they contact has no clue that they can object to these inspections.  This is the main reason I’m writing this article. To educate my fellow Los Angeles landlords as well as tenants that they have rights and they do not have to bend down to the lazy overpaid bureaucrats at city hall.  We pay enough in taxes, fines, parking tickets, and other useless revenue generating schemes.  No more intrusive SCEP inspections that can lead to thousands in repairs, fines, lost rent, and other expenses.

 

Feel free to contact me at derrick.ruiz@exprealty.com or www.losangelesrealestatehelp.com or 310-308-3174. I welcome your comments, questions, or corrections to this article.

 

This article is provided for informational purposes only and is not intended to be legal advice. Please consult legal counsel for advice on your own personal situation. 2019 all right reserved. This article not to be posted without attribution to author.

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Derrick Ruiz CalBRE 00919713

Yes I am a rare creature, a native Angeleno! I was born in the small L.A. suburb of Montebello and could not imagine living anywhere but Southern California. LA is truly home for me. I am a second ge....

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