With occupancy rates slowly rebounding and rental rates still low, many Sacramento commercial landlords are closely watching the bottom line. This is especially true when valuable resources must be spent to evict a non-paying tenant. To save the cost of a paying a registered process server, property managers and landlords will often decide to personally serve, or serve by mail, a pay or quit notice. Unfortunately, this cost saving method often causes the landlord more expense in the end.
Pay or quit notices are only valid and enforceable if the landlord strictly complies with California Code of Civil Procedure section 1162. Absent strict compliance, a landlord is not entitled to possession of the premises. With respect to service of a pay or quit notice, the burden is on the landlord to prove service of a pay or quit notice. Many a landlord’s unlawful detainer action has been defeated by a tenant claiming (truthfully or not) that they never received the pay or quit notice; despite the landlord producing at trial an affidavit of service signed by an employee of the property manager or, an often illegible, signed return receipt. (See Liebovich v. Shahrokhkhany (1997) 56 Cal.App.4th 511). If the landlord used a registered process server, however, the tenant’s mere claim that they never received the notice will fall on deaf ears.
Recently, in Palm Property Investments, LLC v. Yadegar (2011) 194 Cal. App. 4th 1419, a California appellate court specifically held that a proof of service of a pay or quit notice by a registered process server is valid, admissible proof of service of the pay or quit notice. In Palm, the tenant asserted in their verified answer to the complaint that they never received the pay or quit notice. The trial court refused to admit the proof of service signed by a registered process server as evidence of service. On the basis of lack of service, the trial court found for the tenant and dismissed the landlord’s unlawful detainer. The appellate court overruled the trial court’s finding that the process server’s proof of service was inadmissible. The appellate court noted that an affidavit of service signed by a landlord or employee of the property management company is inadmissible proof of service of the pay or quit notice. But, Evidence Code section 647 specifically states that a proof of service signed by a registered process server creates a presumption that service is valid. The court, therefore, held that the proof of service signed by the registered process server should have been admitted by the trial court as proof of valid service of the pay or quit notice.
The lesson learned from the Palm Property case – landlords should always spend the money to have the pay or quit notice served by a registered process server. The cost of the registered process server is far less than the cost of an unlawful detainer trial that is dismissed for lack of proof of valid service of a pay or quit notice.