California landlords doing business in cities with strict rent control laws have found a way to get around such laws and capitalize on the tight housing market. As of 1998 California landlords have simply relied on the utility of the Ellis Act, which has been in the California law books since 1986 and prohibits government agencies from interfering with a landlord's decision to evict tenants and withdraw rental units from the market. For example, in San Francisco, a city with strict rent control laws, 205 buildings were Ellised from July 1998 to June 1999; a jump from 1995, when only 5 buildings were Ellised. The recent trend of Ellis evictions raises several legal issues about a landlord's right to go out of business pursuant to the Ellis Act. Judicial review of the Ellis Act focuses mainly on the intent of the Ellis Act and its effect on local ordinances.
Hugo E. Castillo,
How California Can Harmonize A Tenant's State Rights and A Landlord's Right To Go Out Of Business Pursuant To The Ellis Act, 31 Golden Gate U. L. Rev.