Disclosure of Disability Access Compliance in Commercial Property Leases in Effect January 2017

Beginning January 1, 2017, revisions to current California law will expand the disclosure requirements and the responsibilities of landlords and rights of tenants regarding the compliance of commercial real property with disability access laws. We encourage all of our existing and prospective clients to discuss the new law with us if they are planning to enter into a new lease of California commercial real estate on or after January 1, 2017, whether as landlord or as tenant. Current Law Presently, California Civil Code Section 1938 requires commercial landlords to state in every lease executed on or after July 1, 2013, whether the property being leased has been inspected by a Certified Access Specialist (CASp) and, if so, whether or not the property meets all applicable construction-related accessibility standards. What is CASp Certification? Places of public accommodation — including most California businesses open to the public — must comply with federal and state laws governing accessibility to persons with disabilities. Failure to comply with these standards can expose landlords and tenants to expensive and burdensome lawsuits by individuals with disabilities who experience hardship as a result of the non-compliance. These types of lawsuits are particularly prevalent in California because of state laws that allow private individuals to sue for substantial damages in addition to the injunctive relief (meaning court orders to correct the violations) available under the federal Americans with Disabilities Act. The damages ordinarily include minimum statutory damages of $4,000 per incident, per plaintiff. California’s CASp program provides a system under which landlords and tenants may have their commercial properties inspected for violations of disability access requirements by a licensed CASp and certified as compliant if found to be so by the CASp. If the CASp finds a property to be non-compliant, then the landlord or tenant may remedy any violations found to exist. Although the CASp program is voluntary, by undertaking a CASp inspection landlords and tenants are entitled to certain protections if sued for disability access violations. For example, minimum statutory damages can be greatly reduced and the defendant may ask for a stay of the lawsuit pending a mediation session with the court. This can greatly reduce the overall cost and burden of litigation. The New Law Effective January 1, 2017, the State of California has expanded Civil Code Section 1938 in several ways: If the property being leased has been CASp inspected and, to the knowledge of the landlord the property has not been altered since the inspection in a way that impacts accessibility compliance (meaning the report remains accurate), then the landlord must provide the tenant with a copy of the CASp report prior to execution of the lease. The tenant must first, however, agree to keep the report confidential except as necessary to complete the necessary repairs and corrections that the tenant agrees to make. The new law creates a presumption that any repairs and modifications needed to correct identified violations are the responsibility of the landlord, unless the parties agree otherwise. If the landlord does not give the prospective tenant an opportunity to review any existing CASp report at least 48 hours prior to execution of the lease, then the prospective tenant may rescind the lease for 72 hours after the lease is signed. If the property has been CASp inspected and found to be compliant, then the landlord must provide a copy of the CASp compliance certificate obtained from the inspector and a copy of the report within 7 days after execution of the lease. If a CASp compliance certificate has not been issued for the property, then the lease must include certain language. Contact us today to learn more.