Removing an Expired Mechanics Lien

A contractor who files a mechanics lien on a property generally only has 90 days to foreclose upon it from the time a contractor records the mechanics lien on the property. If a contractor fails to foreclose on the mechanics lien during that period, the mechanics lien expires. Often times, a mechanics lien is still recorded on a property long after they have expired and do not reappear until the property owner attempt to sell or refinance the property. Generally, when there is a cloud on title, a quiet title action is required to remove the cloud; however, with regards to mechanics liens, there is a simplified procedure to remove the cloud.

California Code Section 8460 addresses how to remove expired mechanics liens from your property. It allows a property owner to file a petition for an expedited process to remove the lien from the property. However, prior to filing the Petition, an owner must notify the contractor, subcontractor, or whoever placed the lien on the property of the lien and demand that the lien be released. If the subcontractor agrees to release the lien, it is important to record a release in order to clear title. If the person ignores the demand or refuses to release it, then a petition must be filed with the court.

A hearing date must be scheduled within 30 days after filing the Petition, and the party who recorded the mechanics lien must be served with notice of the Petition and the hearing. This method would much quicker than having to file a quiet title action. Further, it avoids a full civil lawsuit and allows a more expeditious method to remove the lien. If the contractor fails to remove the expired lien on his own, a judge will grant a judgment to remove the lien and award the property owner his attorneys’ fees and costs. for filing the action.

If you have questions regarding removing a cloud on title, please contact Anthony at 818-839-5220.

Five Items Needed By Singles in Estate Planning

Interestingly enough, for the first time in the United States, there are more people who are single than married.  A common misconception that typically singles make is that they do not need to plan their estates until they are married or sometime in the future. Everyone should have some type of estate planning done as to protect themselves and also to protect their assets in case of incapacity or death.

People who are single should definitely be concerned with estate planning, especially in the even of an incapacitation, mainly because they do not have a spouse to make medical or financial decisions in the case of an incapacitation. This is where a durable power of attorney would definitely be of help. Also, disability and long term insurance care should be a major concern for single people due to them not having a spouse to rely on for expenses due to an incapacity or injury.  If a single person does not have a will or plan established then in the case of an incapacitation, the persons family members or friends will have to go to court to have a person in charge of making financial and medical decisions for said person and this will take up a lot of time and a great deal of money, especially if there is an objection to the person who wants to be in charge of the decision making.

Single people should also be very concerned with what will happen to their assets if they do not have an estate plan created for them. Typically there would be a great deal of taxes and costs incurred by the heirs and also the heirs would have to go through a great deal of trouble and time to have a chance or inheriting any assets.

The Five Documents that a single person needs for a good estate plan are as follows:

1. A Will – To have a public record of what is to happen of assets and to carry out specific intent.

2. A Living Will – To have all specific health care needs and wishes to be known in case of incapacity or death.

3. A Revocable Trust – A document that entails what is to happen of assets but instead of being a public record it is private.

4. Health Care Power of Attorney- Allows a certain person to make medical decisions for you if you are unable to do so.

5. Power of Attorney – One of the most important aspects of a single person’s estate plan because the power of attorney basically puts another person in charge of decision making for you, in financial aspects, if you are unable to do so.

With the above five documents, a single person would have a good estate plan that covers most of the important aspects that a single person should be thinking about. Please contact Attorney Anthony Marinaccio at 818-839-5220 for more information regarding estate planning.


Five Costly Mistakes in Estate Planning to Avoid

In the late 1990’s it was estimated that about only sixty one percent of Americans, fifty five years or older had a will or trust established. Recently that number has surprisingly declined to about fifty four percent of Americans having a will or trust in place. Some may have a misconception that not creating a will, or creating a will very late in one’s life may be acceptable, but as many experts have deduced, this is a very wrong way to look about a will or trust. Not having a will, trust or any type of estate planning done as soon as possible will most likely be very costly to you and your loved ones that will have to take care of the estate left to them.


First Mistake – Too young to have an estate plan, or no need for an estate plan because not enough assets to safeguard


Life is not a very predictable thing, and in case of an emergency, the last thing a person wants to do is try to figure out what to do in regards to estate plans and guardianship of minor children. A quick example of this may be that if you become incapacitated and do not have a set estate plan, a family member or friend has to go to court to make medical and financial decisions for you, and if another family member or friend objects then the process could take a long time. The process would not only be long and detrimental to you because you are incapacitated, but also cost a couple of thousand dollars for just the process of choosing your decision maker.


Another very major issue with not having an estate plan established, is that if you do pass away, you do not have any control or decision capability of who becomes the legal guardian of your minor children. This process may also take a great deal of time, be very costly and worst of all, your minor children might end up with a family that would not have been your choice.


A very common misconception in estate planning is that because a couple is newly married and does not have a great deal of assets that if one was to become incapacitated or pass away, the surviving spouse receives everything and it is a very simple process. This is the exact opposite of what happens when there is a death and no estate plan in place, especially if there are no beneficiaries named on bank, brokerage, life insurance, retirement and other financial accounts. The fine print in the documents that correlate to those accounts take place and many will be surprised that the spouse is not the first on the list to receive the monies that they believe is owed to them. A simple estate plan could help with this problem, and alleviate the problems that arise in the passing away of a spouse.


The cost of having a will or trust made and the time it takes to have the estate plan made would be very small compared to the loss of money, time and hassle, and all the types of taxes one would incur by not having a type of estate plan established prior to any incapacitation. Some may think that they are too young to care about an estate plan, but the fact is that surprises in life do happen, and having at least a simple estate plan would help in those situations, and if no surprises occur, then you are still safe in the long run and there is no downside of having an estate plan established too early. Meeting with an estate planning lawyer to just discuss options for an estate plan is a very good starting point, because everyone is going to need a specific will or trust for their specific needs.


Second Mistake – Joint ownership problems


Another very common mistake that people make after a death or divorce is to add their child, relative or friend to the bank accounts, the property titles, the title of other assets so that if they are to pass away, the third person is to be in full control of the asset. This may seem like a good idea at first, especially if the person is a trustworthy individual, but the fact is that as soon as their name is added to whichever asset, that asset becomes also theirs fully. One may trust another person to not do malicious things, but typically people forget that even if the person is trustworthy, if that third person is involved in a lawsuit, divorce or bankruptcy, the assets that their name is on could be at risk.


A very common way to ensure this does not happen with your bank accounts is to fill out a payable-on-death form which a bank typically would have, which basically means that the account is not to have the name of the trusted third party until the passing away of the original owner of the bank account. There are forms like these for other types of assets which are called beneficiary forms which combined with other forms are a good way to ensure protection of assets, but the fact is that a simple written will is a much better way of taking care of the estate plan rather than having dozens of forms which may have fine print and complicate things.

Third Mistake- What a Will does not do for you


A common mistake that people believe in is that a will has the final decision of where assets are placed after a death. If there is a 401(k), an IRA account, payable-on-death forms, named beneficiary forms or other types of these forms, these are the final deciding factors on where assets are placed after a death. Many people forget who is named beneficiary on certain assets and forget to update certain ones or even create certain ones.


Keeping in mind to update all forms named above and to make sure that whoever is named on these documents is correct is a very useful thing to do every couple of years. This is basically a do it yourself type of estate planning, but having a will established can help with the gaps and areas that do not have these types of forms, or do have these types of forms but one may have forgotten to fill one out. Estate planning is a complex thing to do to make sure that every angle is covered, and having a will definitely sets a nice base for safety.


Fourth Mistake – Asset Disbursement


In the event of a death and assets being given to a child, relative or third person, the person that is receiving the assets must obviously be a trustworthy person to make sure that they not treat the inheritance as a gift and spend all of it, ruin business or just do a bad job of financial decision making. Having a will or trust established can allow for sets of rules and instructions on how the assets should be dispersed and also the time frames of how the assets should be delivered.


The beneficiary forms, payable-on-death forms, and all these types of forms typically do not include very specific directions and instructions on payments made to the beneficiary. It is beneficial to have a will or trust established because firstly the person on the receiving end could be more responsible if the assets are given to them in payments, and also, if the person is involved in a divorce, bankruptcy, or lawsuit, the assets would not fully be in risk, because the assets would not fully be in their possession.


Fifth Mistake – Over Complicating the Estate Plan


The federal estate gift tax exemption is about $5.43 million dollars currently, and has been going up every year due to inflation. Spouses may combine these gift tax exemptions to give away $10.86 million dollars without the receiving end owing federal taxes.


When these tax exemption limits were lower, many married couples had complex estate plans to try and save as much money as they could by not having to pay taxes. Bypass trusts were a very common way to try and exempt their heirs from paying taxes on the gifts that they received.


Currently one does not really need to have a bypass trust set up in order to be exempt from large amounts of taxes by using both spouses exemptions, but in certain occasions, a bypass trust may be beneficial to safeguard assets from creditors.


If you have questions regarding Estate Planning, please contact Anthony at 818-839-5220.


Section 8 Tenancies in Non-Rent Control Apartment Units

LAist recently posted an article regarding a landlord in in the Mid-City area of Los Angeles evicting all Section 8 tenants in an apartment building. Under Section 8 guidelines, a landlord is only required to serve a tenant with a 90 Day Notice to Quit stating that the landlord does not want to work with the Section 8 program.

A landlord in Los Angeles is allowed to terminate Section 8 tenancies when the apartment building is not subject to the Los Angeles Rent Stabilization Ordinance. As a tenant in a non-rent control building, there are much fewer protections against evictions. The Section 8 tenants being evicted under this situation would not be entitled to relocation fees under the Los Angeles Rent Stabilization Ordinance.

Generally, an apartment building is not subject to Los Angeles’ rent control if the certificate of occupancy for the building was issued after 1978. Tenants in non-rent control buildings in Los Angeles can receive 3o or 60 Day Notices to Quit unlike tenants in rent-control units.

The article is “New Landlord Doesn’t Feel Like Housing Poor People Anymore, Tenants Say.” For more information regarding evictions of Section 8 tenants, please contact Anthony Marinaccio at 818-839-5220.

Q & A Regarding Ellis Act Evictions

89.3 KPCC recently posted a questions and answer article regarding tenant’s rights under the Ellis Act. The article is informative for both landlords and tenants because it outlines what occurs during an eviction under the Ellis Act in the City of Los Angeles. The article is relevant for owners and tenants in units subject to the Los Angeles Rent Stabilization.

I generally find that tenants have few rights to stay or “fight” the eviction under the Ellis Act; however, they would be entitled to certain relocation benefits and time frames to move. These issues are important as evictions under the Ellis Act are becoming more prevalent as landlords purchase properties to develop into condominiums, single family homes, or other non-rental uses.

The KPCC article is Renter FAQ: What to do if you get an eviction notice under the Ellis Act. Please contact Attorney Anthony Marinaccio at 818-839-5220 for more information.

Evictions Based Upon Airbnb Violations on the Rise

Although this article discusses Airbnb violations in San Francisco, the issues regarding when a tenant rents a unit on Airbnb is the same in San Francisco or in Los Angeles (or anywhere in California). The article is “Airbnb Violations Now Being Used More Often Than the Ellis Act in SF.” Most leases contain a clause that a tenant cannot sublease or assign a lease without the landlord’s permission. When a tenant rents the unit or  a space within the unit on Airbnb, essentially the tenant is subleasing the unit.

A sublease is a separate rental agreement between the original tenant and a new tenant who moves in temporarily or who moves in with the original tenant. The new tenant would be called a “subtenant” and the original tenant can be called a “sublessor.”

Under a sublease, the original tenant is still responsible to the landlord to pay the rent and is responsible for violations of the rental agreement even if the subtenant is the one causing the breach. A subtenant has no contractual relationship with the landlord, meaning that a landlord cannot evict a subtenant alone.

There are certain issues that arise when subleasing a unit. First, most leases do not allow subleasing without the landlord’s permission. Landlords are becoming more aware that tenants are renting their units on Airbnb, which could be a breach of the rental agreement.

Further, if you are subleasing, it is important that the tenant be in good standing with the landlord. For example, a subtenant who pays a sublessor can still be evicted by a landlord if the sublessor is not paying the landlord the rent. There are defenses and issues that may arise in this situation, but essentially if a sublessor breaches the lease by not paying the rent, all of the residents in a unit can be evicted.

If you are looking to evict a tenant based upon a violation of the lease or in a situation involving a violation of the rental agreement, please contact Attorney Anthony Marinaccio at 818-839-5220.


Ellis Act Evictions on the Rise in Los Angeles

KPCC is confirming that evictions under the Ellis Act are on the rise in Los Angeles. The Ellis Act allows landlords to get out of the rental business. It is usually used for condominium conversions and demolishing old units to make new condo units.

In Los Angeles, in addition to the provisions of Government Code Sections 7060-7060.7, the Los Angeles Rent Stabilization Ordinance (“LARSO”) also addresses the process for landlords wanting to evict tenants under the Ellis Act. I have written on the Ellis Act before and the many articles can be found here.

Under the LARSO, tenants are required to get a 120 Day Notice to Vacate, are entitled to relocation, and if they are disabled or elderly can elect to stay in the unit for up to one year. It is important to understand these provisions prior to starting the development process.

KPCC’s article “Ellis Act evictions in L.A. on the rise” provides some of the background on why these evictions are becoming popular and why we may see more in the future as housing prices increase.

Dying without a Will in California

If a resident of California passes away without having an executing a will or revocable living trust, California has an entire set of laws in the Probate Code, known as “intestacy” to determine who will get your estate. The intestate laws have a series of questions to be answered do determine who can inherit the estate.

Whether or not the person is married is the first major question.

Persons Not Married At Death (Includes Single Persons, Divorced Persons, and Widows/Widowers)

If the person was not married the estate is inherited as follows:

1. If there were children in the same generation, they take equal shares of the estate.

2. If there were no children, grandchildren, great-grandchildren, etc; then the estate will be inherited by the parents of the deceased.

3. If the deceased does not have any living parents then the estate is given to the brothers or sisters of the deceased. If the brothers or sisters have passed away and had an “issue,” the issue will be able to inherit whatever amount would have been inherited if the brother or sister had been alive.

4. If there are no brothers or sisters the grandparents shall inherit the estate of the deceased.

5. If there are no living grandparents, the issue of the grandparents shall inherit the estate. This may entail the deceased aunts or uncles, and if there are no aunts or uncles then the decedent’s cousins may be entitled to the estate.

6. If there are no cousins then according to the Probate Code 6402, the estate shall be given to the next of kin in equal degree.

Persons Who Are Married At Death

If the person was married at death, then there are two sets of questions to ask to determine who will get that person’s estate.

First, the main question is whether the deceased owned community property, separate property or a mix of both types of property. A simple definition of community property is the assets and earnings that the deceased had earned during the time of the marriage and the separate property is the assets that were brought into the marriage in the beginning.  California has very diverse definitions of these and separate property and community properties may be intertwined and mixed together to provide some benefits. The following are the steps and rules that are to be followed;

1. The community property of the deceased shall go to the spouse, once a spousal property petition is established.

2. The separate property of the deceased shall be distributed as follows;

A. The spouse is entitled to the separate property if the deceased is not survived by parents, brothers or sisters, or children of a brother or sister that have passed away.

B. The spouse is entitled to half of the separate property if the deceased had only one child or had an issue of a child that had passed away.

C. The spouse is entitled to half of the separate property if the deceased had left no issue, but had left parents or an issue of the parents.

D. The spouse is entitled to one third of the separate property if the deceased had left more than one child.

E. The spouse is entitled to one third of the separate property if the deceased had left one child and the issue of one or more children.

F. The spouse is entitled to one third of the separate property if the deceased had left two or more issues of children.

These are the default rules if you do not have a will or revocable living trust in place. The intestacy laws show how important a will can be if you want your estate to go to people who are not listed in article (i.e., non-spouses, friends, distant relatives). Please contact Attorney Anthony Marinaccio at 818-839-5220 for more information.

Holding Title as Joint Tenants

Joint Tenancy is a type of ownership of real estate by two or more persons in which each owns an undivided interest in the whole property. Joint tenancy is often touted as one method of estate planning; however, there are consequences you may not be aware of that could not make it the best option available.

When a joint tenant dies, the interest in the property is then vested into the interest of the surviving joint tenant or joint tenants. Simply put, if one of two joint tenants passes away, the second party of the joint tenancy gains all the percentage of interest of the party who passed away and has one hundred percent of the property.

In order for the property to pass the surviving joint tenant, the surviving joint tenant would be required to record an Affidavit of Death of Joint Tenant with a copy of the deceased joint tenant’s death certificate. It avoids probate and trust administration, and is a relatively short and easy process to acquire property after a death.

A joint tenant cannot pass on the property through a will or revocable living trust, so there are no other options as to who will receive the property except to the surviving joint tenants.

One of the main drawbacks in owning a property in joint tenancy is that any joint tenant can file a partition action to force the sale of the property. Further, if a joint tenant has a judgment against him or her, that judgment can attach to the property.

I generally do not recommend using joint tenancy as an estate planning tool but to draft a will and revocable living trust because ultimately it gives you control during your lifetime without relinquishing that control to another. Further, if there is a dispute between you and your joint tenants, any joint tenant can file a partition lawsuit and require that the property be sold, even if you live on the property.

Please contact Attorney Anthony Marinaccio at 818-839-5220 for more information regarding joint tenancy properties.

Attorneys’ Fees Provisions in Rental Agreements

The California Court of Appeal recently found that provisions in a residential lease that allow for attorneys’ fees may be recovered in the case of a declaratory relief and intentional interference with prospective economic advantage claim. Burien LLC v. James A. Wiley provides some insight on the recovery of attorney’s fees in accordance with rent control in Los Angeles. This case actually stems from the same case I discussed several months ago that involved raising the rent on a condominium conversion that can be found here. The issue that the Court had to review was not the substance of whether a landlord could raise the rent; rather, it was whether a tenant could seek attorneys’ fees in the action.

In 1981, James W. Wiley (“Tenant”) had leased a unit in a building subject to the Los Angeles Rent Stabilization Ordinance (“LARSO”). In 2011, the Landlord purchased the property where the Tenant lived and sent a notice to the tenants that the rent would increase from $1,401 to $3,000 a month. If the building was not subject to the LARSO, the Landlord could have been within his rights to raise the rent to that level; however, the LARSO controls how much a Landlord can raise the rent on a tenant annually.

First, the Los Angeles Housing Department (“LAHD”) sent a letter to the Landlord stating that the rent increase violated the Los Angeles Rent Stabilization Ordinance (LARSO). Ignoring this letter, the Landlord filed a complaint in the instant action against the Tenant for declaratory relief and intentional interference with prospective economic advantage. The Complaint alleged that the two parties were having a dispute on the correct rental rate and sought resolution as to the amount of rent that could be charged.

The Landlord believed that his rental rate increase did not violate the LARSO, while the Tenant believed that it did in fact violate the LARSO. The Landlord also wanted to recover costs of the suit, compensatory damages, and further relief as the court deemed fit. In response, the Tenant sought a dismissal of the action with prejudice, recovery of the cost of suit and recovery of attorneys’ fees. The trial court found in favor of the Tenant due to the property not being an exempt from the LARSO, and thereafter the Landlord appealed. The appellate court also found in favor of the Tenant and affirmed the judgment.

After winning on appeal, the Tenant filed a motion seeking the recovery of the attorney’s fees of about $17,000 on the basis of the attorney fees provision in his rental agreement. Upon examination of the rental agreement the trial court found for the Landlord stating that the attorney fees provision was too broad.

On appeal it was found that the rental agreement entailed recovery for attorney fees if the Landlord brings action on the account of the lessee’s failure to pay the rent. When the Landlord increased the rent, believing that his increase would not be affected by the LARSO, and the Tenant failed to pay, the collection of the rent was Burien’s cause for action. The action brought for declaratory relief was brought to enforce the payment of the increase in the rent and for the damages caused.

The Court concluded that the attorney fees provision in the rental agreement applied to the instant action and the matter was remanded for the Tenant to be reimbursed for the attorney fees. The Court relied upon Civil Code Section 1717 which states, “In any action on a contract, where the contract specifically provides that attorney’s fees and costs, which are incurred to enforce that contract, shall be awarded either to one of the parties or to the prevailing party, then the party who is determined to be the party prevailing on the contract, whether he or she is the party specified in the contract or not, shall be entitled to reasonable attorney’s fees in addition to other costs.”

Civil Code Section 1717 can be applied when the recovery sought in the action was declaratory and as long as the action had a contract involved.

Attorneys’ fees provisions in rental agreements are an important tool for landlords and tenants. They are important to review to determine and there may be reasons why a landlord may or may not want an attorneys’ fee provision in a rental agreement. Further, there are methods to cap attorneys’ fees to avoid the outcome of this case where the Landlord was required to pay over $17,000 in attorneys’ fees for the tenant’s attorney.

Please contact Attorney Anthony Marinaccio at 818-839-5220 for more information regarding these issues on landlord-tenant matters.

Glendale Attorney; Real Estate Law; Business Law; Estate Planning