Commercial Tenant Can't Claim Breach of 'Warranty of Habitability'

May 19, 2021

What Happened: The tenant admitted to not paying its rent. The only question was whether it had a valid defense for not doing so. The tenant’s argument: The landlord violated its “warranty of habitability” by failing to fix the leaky roof. As the landlord pointed out, the lease the parties signed was a standard boilerplate form that didn’t say anything about a warranty of habitability. The warranty was implied, the tenant countered. The court disagreed and awarded the landlord $25,000 in unpaid and holdover rent. The tenant appealed.

What Happened: The tenant admitted to not paying its rent. The only question was whether it had a valid defense for not doing so. The tenant’s argument: The landlord violated its “warranty of habitability” by failing to fix the leaky roof. As the landlord pointed out, the lease the parties signed was a standard boilerplate form that didn’t say anything about a warranty of habitability. The warranty was implied, the tenant countered. The court disagreed and awarded the landlord $25,000 in unpaid and holdover rent. The tenant appealed.

Ruling: The California appeals court upheld the lower court’s ruling.

Reasoning: The first problem with the tenant’s defense was that, as is the case in most states, there’s no implied warranty of habitability in a commercial lease under California law. Implied warranties of habitability apply only to residential leases. And, the court continued, even if the defense did exist in a commercial eviction case it wouldn’t have done the tenant any good because the evidence showed that the leak it complained of happened in December 2019, one month after the landlord served the notice of eviction for not paying rent from July through October 2019.

  • Hawthorne Inv. v. Lam, 2021 Cal. App. Unpub. LEXIS 2385

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