Ask a Maritime Attorney: Tenant Protection Laws and Covid-19

Question: I have lived aboard a small motor yacht in a marina in Northern California for more than five years. During that time, I paid my rent on time and complied with all of the marina rules, but there have been excessive increases in slip fees every year. The docks are now being replaced and they want to move me to a larger slip, which will of course increase my rent. To make matters worse, during this pandemic they started charging me for utilities. I was under the impression that tenants are protected while the state-wide “stay at home” orders are still in place. Can I sue the marina for violating these tenant protection laws?

Answer: Thank you for your question. I answered questions like this from readers of The Log for eleven years before taking a sabbatical in 2017, and as we all work through this Covid-19 pandemic it seems like a good time to take another look at the legal issues that often confront boaters. In this case, a marina tenancy dispute.

Marina slip rental agreements are maritime contracts that are subject to federal admiralty jurisdiction and federal law, which in this context tends to be very landlord friendly. The short answer to the reader’s question is that the protections that have been implemented during this pandemic period are for the most part directed at residential dwelling rentals and they do not protect a boat owner who rents a slip in a marina. So, he can’t sue the marina for raising his rent.

Notwithstanding the application of federal maritime law, state law may apply to aspects of a slip rental agreement, and certain state and non-maritime federal protections enacted during the pandemic may be relevant to a marina eviction. Let’s take a look at how the various programs may be relevant to a marina tenancy.

Under the recent Federal Coronavirus Aid, Relief, and Economic Security (CARES) Act, landlords with federally backed mortgages or who participate in federally assisted rental housing programs, can’t start eviction actions or collect fees or penalties from tenants based solely on non-payment of rent. These mortgages, however, are intended for small residential dwelling units and are not available for a large commercial property such as a marina, so the CARES Act offers no protection for marina tenants.

State law in California may be more helpful. On March 4, Gov. Gavin Newsom declared a California-wide state of emergency that automatically capped rent increases. Unfortunately, this order, like the federal CARES program, has no effect on a marina slip rental agreement which is subject to federal maritime jurisdiction.

We should note that a default of a maritime contract subject to federal maritime jurisdiction will give rise to a maritime lien against the vessel, which may be enforced by filing a lawsuit in federal court and having the boat seized, or arrested, by Federal Marshals. This is a very powerful tool for a marina operator, and it is not restricted by any of the rules enacted during the pandemic, but it is also very expensive and as such it is rarely used for a marina eviction. A marina operator may therefore, under normal circumstances, consider remedies available under state law for a cheaper alternative. A simple eviction, using the unlawful detainer tools that are available for the eviction of an apartment tenant, would be a lot cheaper than a federal law lien foreclosure proceeding. But these are not “normal” times. This is where a boat owner may in fact see some relief, thanks to the Judicial Council of California.

The Judicial Council of California is the rule-making arm of the California court system, and on April 6, it adopted an emergency rule which effectively placed a moratorium on evictions in California courts. The moratorium will remain in place until 90 days after Newsom declares the state of emergency to be over, and it prevents courts from issuing a summons in an eviction case or entering a default judgment, and court trials in pending cases are delayed for at least 60 days. In short, tenants must still pay rent, they but cannot be evicted during the freeze period for failing to pay rent.

The freeze on evictions was not implemented with boat owners or marina evictions in mind.  It was intended to provide relief to renters of residential real estate. But the emergency rule did not distinguish between different types of evictions. It simply put a stop to all eviction proceedings in state court unless the eviction is, for some reason, necessary to protect public health and safety. As such, marina operators find their hands tied in the same way as landlords in a residential real estate tenancy if they are pursuing an eviction order in state court.

So, a federal maritime lien foreclosure is too expensive, and a state court eviction proceeding is temporarily blocked under the pandemic protection rules. What’s left?

California’s “Boaters Lien Law,” codified in sections 500 through 509 the Harbors and Navigation Code, provides guidance for the eviction of a boat from a marina, but it is applicable only to DMV registered vessels. The law provides for a private lien sale to be conducted with the assistance and guidance of the Department of Motor Vehicles, and after the boat is sold the new owner will take possession.

The procedure set forth in the Boaters Lien Law is very effective for a marina with a delinquent owner of a DMV registered boat. However, since most boats that are over 35 feet in length are documented with the U.S. Coast Guard, the DMV procedure may not provide much help for a marina with larger boats in its slips.

It is evident from this discussion that marina evictions, which are always complicated, are especially troublesome during the current pandemic. The federal court procedure described above for the foreclosure of a maritime is expensive, but it may be the best option for a marina dealing with delinquent slip payments from owners of Coast Guard documented vessels. It is not subject to any of the pandemic protection rules and it involves a seizure of the boat by U.S. Marshals with no warning to the boat owner. Regardless, marinas and slip tenants should both seek experienced maritime legal counsel if they are confronted by these issues.

 

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