California Commercial Property Owners – Lease Updates Needed

  • February 9, 2017

On September 16, 2016, Governor Jerry Brown signed Assembly Bill 2093, which amended California Civil Code Section 1938 placing increased burden on commercial property owners when leasing their property.  Those who ignore or who are unaware of the amended statute are exposed to substantial financial risk for their non-compliance.

The law requires every rental agreement, signed on or after January 1, 2017 to advise the tenant in advance as to whether the subject premises has undergone an inspection by a Certified Access Specialist (CASp).  A CASp inspector inspects buildings and sites for compliance with applicable state and federal construction-related accessibility standards under the ADA and state equivalents.

Where property has undergone a CASp inspection and received a disability access inspection certificate, it is advisable to provide the appropriate notices and reports to the tenant within the specified timelines.  In the event the subject premises has not been issued a disability access inspection certificate, the commercial property owner is required to state the following on the lease form or rental agreement:

“A Certified Access Specialist (CASp) can inspect the subject premises and determine whether the subject premises comply with all of the applicable construction-related accessibility standards under state law. Although state law does not require a CASp inspection of the subject premises, the commercial property owner or lessor may not prohibit the lessee or tenant from obtaining a CASp inspection of the subject premises for the occupancy or potential occupancy of the lessee or tenant, if requested by the lessee or tenant. The parties shall mutually agree on the arrangements for the time and manner of the CASp inspection, the payment of the fee for the CASp inspection, and the cost of making any repairs necessary to correct violations of construction-related accessibility standards within the premises.”

Failure to comply with Civil Code Section 1938 may allow a commercial tenant to rescind the lease agreement.  Of greater concern may be the question of who must pay for the improvements required by the CASp inspection report.  Unless otherwise specifically agreed between the landlord and tenant, the presumption is that the commercial property owner shall pay for both the report and any required repairs set forth in the report.

The law requires different notices be provided from landlord to tenant based on whether there has been a CASp inspection and whether a disability access inspection certificate has been granted.  Additionally, if a CASp inspection or certificate has not been issued, landlords may wish to consider including specific in the lease agreement with regard to payment of costs regarding the inspection if one has not already taken place as well as the costs of bringing the property in compliance if it turns out not to be in compliance.

If you need more information or have any questions regarding how the new law may affect your business, do not hesitate to contact Incline Law Group, LLP for some clarity on the subject.