California Legal Brief

The Rule of Colonial Manor, Inc. v. Vilma Reyes is that a landlord cannot enforce an unlawful detainer for rent that exceeds local rent control ceilings, even against a surviving spouse who becomes an implied tenant after the original tenant's death, under circumstances where the spouse was a long-term lawful occupant known to the landlord and Costa-Hawkins does not preempt local rent control protections for implied tenancies.

Appeal from judgment after court trial on stipulated facts in Superior Court, County of Los Angeles, Santa Monica.

Plaintiff Appellant was Colonial Manor, Inc. — the landlord who sought to increase rent from $666 to $3,500 per month after the original tenant's death and served a three-day notice demanding the increased rent.

Defendant Respondent was Vilma Reyes — the surviving spouse of the original tenant who continued occupying the rent-controlled unit after her husband's death and was served the three-day notice.

The suit sounded in unlawful detainer for failure to pay rent.

The key substantive facts leading to the suit were: Milton Reyes was the original tenant paying $666/month rent; defendant lived with Milton for at least one year before marrying him in February 2022; Milton died in September 2023; defendant continued occupying the premises; plaintiff served defendant a Notice of Change of Tenancy increasing rent to $3,500/month in November 2023; defendant was served a three-day notice to pay $3,500 or quit in March 2024; defendant did not pay the demanded amount; the Santa Monica Rent Control Charter Amendment (SMRCCA) set maximum allowable rent at $669/month.

The procedural result leading to the Appeal: The trial court entered judgment in favor of defendant for possession of the premises, ruling that defendant was a tenant (not subtenant), the SMRCCA was not preempted by Civil Code section 1954.53 (Costa-Hawkins), and the three-day notice overstated the lawful rent due.

The key question(s) on Appeal: 1. Whether the SMRCCA was preempted by Costa-Hawkins Act section 1954.53 2. Whether defendant was a subtenant subject to unlimited rent increases under Costa-Hawkins 3. Whether the rent increase and three-day notice were valid under the SMRCCA

The Appellate Court held that defendant became an implied at-will tenant through her long-term lawful occupancy known to the landlord, Costa-Hawkins section 1954.53(d)(2) applies only to subleases and assignments (not implied tenancies), the SMRCCA was not preempted by state law, and the three-day notice was fatally defective for overstating rent due under local rent control limits.

The case is inapplicable when the surviving occupant was not a lawful long-term resident known to the landlord, when there is an actual sublease or assignment agreement, when the occupant was not married to or related to the original tenant, or when local rent control ordinances do not contain similar spousal protection provisions.

The case leaves open whether landlords may evict occupants who resided without the landlord's knowledge or agreement and seek to remain after departure of all consented occupants, and the precise scope of Costa-Hawkins preemption in other factual scenarios involving unauthorized occupants.