New Bill Might Impact Commercial Property Owners

Filed under: Real Estate Law

In the past, California landlords and business owners have faced a high risk of being sued for accessibility violations of the Americans with Disabilities Act (ADA). Even though California is home to only 12 percent of the nation’s disabled population, 40 percent of ADA accessibility lawsuits are filed in our state. Were California landlords just that lax about following accessibility regulations? Or did the law allow for a high degree of ADA abuse claims? Some disabled persons made a cottage industry of searching businesses in minute detail for the slightest violation and filing quick strike lawsuits, in essence blackmailing owners for quick settlements.

Last month, Assembly Bill 2093 was approved as an extension of Senate Bill 1186, which was passed in 2012. The original bill required commercial landlords to disclose to prospective tenants their inspection status with a California Certified Access Specialist (CASp). AB 2093 expands upon that rule by specifying additional disclosure requirements.

If a property has been inspected by a CASp and meets current accessibility standards, the landlord must provide the prospective tenant with a copy of the current CASp certificate and inspection report. With tenants assured that the property is in compliance with ADA regulations, a future lawsuit is much less likely.

If the property has not been inspected by a CASp, commercial leasing agreements must state that the owner cannot prevent an inspection if requested by the tenant. The lease should also state that both parties must agree to the time and manner of inspection, payment of related fees, and the cost of making any repairs.

If the property has been inspected by a CASp but was not modified to meet ADA requirements, the landlord must provide the inspection report to the tenant at least 48 hours before the lease is executed. During this 48-hour period, the tenant can decide whether her or she wants to enter into the lease agreement and can negotiate with the landlord regarding any necessary modifications to the property.

AB 2093 also establishes landlord responsibility in the case of renovations required by ADA standards, unless the parties come to another agreement. This part of the bill is designed to encourage both landlords and tenants to deal with accessibility requirements proactively, rather than waiting until after a lawsuit has been filed.

Hopefully, the new bill provides the right incentives for property and business owners to negotiate ADA compliance issues upfront, so that many of these lawsuits can be avoided. With the new law taking effect on January 1, 2017, commercial property owners should contact our real estate attorneys with any questions regarding evaluating or revising their leasing forms.

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