LEGAL ALERT

The Rosenthal Act Being Used to Sue Businesses, Including Self Storage

The Rosenthal Fair Debt Collection Practices Act (Rosenthal Act)  was passed in in 2020 is now being used by some attorneys to file lawsuits against businesses that are non-compliant (similar to attorneys using ADA laws to file lawsuits).

Several lawsuits have been filed against California and Florida self storage businesses regarding the violation of the Rosenthal Act.

What is this law?

The Rosenthal Fair Debt Collection Practices Act (Rosenthal Act) is a California law that governs debt collection agency practices for personal debts—including how and when a debt collector may contact an individual about money allegedly owed. The primary difference between the Rosenthal Act and the federal Fair Debt Collection Practices Act is that the Rosenthal Act is broader, and applies to original creditors in addition to third-party collectors.

The Rosenthal Act simplifies the FDCPA and applies to any person who, as part of their ordinary course of business, engages in debt collection—which it broadly defines as "any practice or act in connection with the collection of consumer debts." The Rosenthal Act also covers those who write or sell forms, letters and other collection media intended to be used for debt collection. Attorneys must also comply.

Subject to limited exceptions, debt collectors (which may include your managers/employees) in California must comply with both the Rosenthal Fair Debt Collection Practices Act and the federal Fair Debt Collection Practices Act.

What does this law include?

The Rosenthal Act includes several requirements such as:

• Specific hours and methods for contacting debtor
• Language restrictions when attempting to collect a debt
• Avoid misrepresentation
• Forbidden to communicate with debtor’s employer or family
• Non-disclosure (confidential) of debtor and debt
• Notification of debt discharge to due bankruptcy or other issues

CSSA Recommendations

• Review your policy and practices for contacting past-due accounts
• Simple rule: Owners should immediately limit all electronic communications (text, email, robo-calls and/or phone calls) to reasonable business hours i.e. 8 AM- 8PM daily.
• Consult your attorney for further modifications to your debt-collection practices to avoid lawsuits

Steve Mirabito                                                                 Ross Hutchings

CSSA Legislative & Legal Chair                                    CSSA Executive Director

This Includes Self Storage

Attorney General Bonta Issues Consumer Alert on Price Gouging Following State of Emergency Declaration in Del Norte, Humboldt, and Mendocino Counties

Thursday, December 5, 2024

Contact: (916) 210-6000, agpressoffice@doj.ca.gov

OAKLAND – California Attorney General Rob Bonta today issued a consumer alert following the Governor’s declaration of a state of emergency in response to this morning’s 7.0 magnitude earthquake felt throughout Northern California. In today’s alert, Attorney General Bonta reminds all Californians that price gouging during a state of emergency is illegal under Penal Code Section 396. Californians who believe they have been the victim of price gouging should report it to their local authorities or to the Attorney General at oag.ca.gov/report. To view a list of all price gouging restrictions currently in effect as a result of proclamations by the Governor, please see here. 

“California’s price gouging law protects people impacted by an emergency from illegal price gouging on housing, gas, food, and other essential supplies,” said Attorney General Bonta. “If you see price gouging — or if you've been the victim of it — I encourage you to immediately file a complaint with my office online at oag.ca.gov/report or contact your local police department or sheriff’s office.”

California law generally prohibits charging a price that exceeds, by more than 10%, the price a seller charged for an item before a state or local declaration of emergency. For items a seller only began selling after an emergency declaration, the law generally prohibits charging a price that exceeds the seller's cost of the item by more than 50%. This law applies to those who sell food, emergency supplies, medical supplies, building materials, and gasoline. The law also applies to repair or reconstruction services, emergency cleanup services, transportation, freight and storage services, hotel accommodations, and rental housing. Exceptions to this prohibition exist if, for example, the price of labor, goods, or materials has increased for the business.

Violators of the price gouging statute are subject to criminal prosecution that can result in a one-year imprisonment in county jail and/or a fine of up to $10,000. Violators are also subject to civil enforcement actions including civil penalties of up to $2,500 per violation, injunctive relief, and mandatory restitution. The Attorney General and local district attorneys can enforce the statute.

Enforcing the Non-Monetary Default Remedy

New Law Makes it Easier to Dispose of Tenants Property

if They Fail to Vacate

On January 1, 2025, California self storage operators will have an easier time disposing of tenants property if they fail to vacate when removed from your facility for reasons other than lack of payment. Thanks to the work of SSA (our national self storage association) and our lobbyist, the self storage bill AB 1916 was passed and signed into law by Governor Newsom.

Quick Takeaways

• AB 1916 eliminates the need to file an unlawful detainer lawsuit when a tenant fails to remove his property following the termination or non-renewal of the tenant's rental agreement 
• Instead, AB 1916 provides a self-help process that does not require court involvement 
• This process requires that the operator send two notices to the tenant before, in most circumstances, advertising and conducting a sale of the property 
• AB 1916 also allows operators to amend their rental agreements by giving at least thirty (30) days' notice in writing to the tenant. If the tenant continues to store property at the facility after the date provided in the notice, the amended rental agreement is binding on the tenant even if not signed by the tenant 
• AB 1916 takes effect on January 1, 2025

Use this link for further information: https://www.dropbox.com/scl/fi/5b68dj0taf37rxivj0klx/AB-1916.pdf?rlkey=cft2phsr55qjcs96stwzi7bvp&st=oa7jzjxx&dl=0

Although this law will streamline the disposal of property as described above, it must be done correctly. To better help you understand how to do this, CSSA is hosting two (2) virtual seminars: December 17 and January 28. This seminar will include detailed description by attorney Carlos Kaslow, along with live Q & A session of steps needed to remove the tenant and their property.

Registration is open for each of these webinars:

• December 17, 2024 – https://californiaselfstorage.org/event-5921732
• January 28, 2025 –  https://californiaselfstorage.org/event-5971354

Also, CSSA has the NEW updated Lien Law Annotated Manual, which will include details about this new law. You can order your new manual online Here

CSSA and SSA are pleased to provide the California self storage industry with this new law which can help you effectively deal with troublesome tenants.

Please help us continue with our advocacy efforts on your behalf by donating to the CSSA Local Initiatives Fund: – 100% of these donations are used to help fight local initiatives that may be harmful to operating a self storage in that municipality.

Thank you,  

Ross Hutchings

Executive Director – California Self Storage Association

ross@californiaselfstorage.org

New Law Makes it Easier to Dispose of Tenants Property

if They Fail to Vacate

On January 1, 2025, California self storage operators will have an easier time disposing of tenants property if they fail to vacate when removed from your facility for reasons other than lack of payment. Thanks to the work of SSA (our national self storage association) and our lobbyist, the self storage bill AB 1916 was passed and signed into law by Governor Newsom.

Quick Takeaways

• AB 1916 eliminates the need to file an unlawful detainer lawsuit when a tenant fails to remove his property following the termination or non-renewal of the tenant’s rental agreement.

• Instead, AB 1916 provides a self-help process that does not require court involvement.

• This process requires that the operator send two notices to the tenant before, in most circumstances, advertising and conducting a sale of the property.

• AB 1916 also allows operators to amend their rental agreements by giving at least thirty (30) days’ notice in writing to the tenant. If the tenant continues to store property at the facility after the date provided in the notice, the amended rental agreement is binding on the tenant even if not signed by the tenant.

• AB 1916 takes effect on January 1, 2025.

Use this link for further information: 

https://www.dropbox.com/scl/fi/5b68dj0taf37rxivj0klx/AB-1916.pdf?rlkey=cft2phsr55qjcs96stwzi7bvp&st=oa7jzjxx&dl=0

Although this law will streamline the disposal of property as described above, it must be done correctly. To better help you understand how to do this, CSSA is hosting a virtual seminar on December 17, with descriptions by attorney Carlos Kaslow, along with live Q & A session. Registration is open for this session: https://californiaselfstorage.org/event-5921732

In addition, CSSA is purchasing an updated Lien Law Annotated manual, which will include details about this new law. These new manuals will be available for order by the end of this year.

Again, our thanks to SSA and lobbyist Naomi Padron for navigating this bill through the California legislature.

Ross Hutchings

Executive Director – California Self Storage Association

ross@californiaselfstorage.org