The California Legislature made many changes to California real estate law for 2019. The number of changes is undoubtedly substantial, but there is no need for you to know all of them, only the most important ones.

That’s why we made this article to summarize the most significant changes you need to know.

Disposal of Commercial Tenant’s Personal Property 

Landlords have the right to dispose of or keep the personal property of their tenants, once the lease was terminated and the property vacated.

The new law has changed the threshold value that decides whether the landlord may keep or throw out a tenant’s property. If there is a reason to believe the resale value of the property is less than the amount of one month’s rent or $2500 (whichever is greater), the landlord may keep or dispose of the property.

Commercial Property Abandonment

California already had a law which stated that the landlord could serve their tenant a ‘Notice of Belief of Abandonment’ after fourteen days of unpaid rent. This notice is given when there is a reasonable belief that the tenant has abandoned the property.

The law has been amended for 2019, and the time has been changed to only three consecutive days. Now every landlord may send the notice much sooner.

Additionally, the new code states that the notice can be delivered via overnight courier service.

Private Transfer Fees Limitations

The seller of real estate can impose private transfer fees on a buyer and any subsequent buyer when the property is transferred. However, recent changes prohibit the sellers from creating any new conditions and restrictions which place an obligation on the new owners to pay specific transfer fees. They may only do so when the fees are a direct benefit for the property, not the seller personally.

Naturally, existing transfer fees are not affected by changes in the law. However, any new fees can only be created if they provide a direct benefit for the property, according to federal law. In essence, a direct benefit is the maintenance and improvement of the property.

Additional Changes

Most commercial real estate transactions include general releases which often quote California code. The code in question is the one that deals with general releases, and it is located in the Civil Code Section 1542. The code has been altered, and both buyers and sellers of real estate need to know these changes. If they are going to quote the law, it will have to be the new version.

Here is the changed text:

A general release does not extend to claims that the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release and that, if known by him or her, would have materially affected his or her settlement with the debtor or released party.

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