UDR (NYSE:UDR) Throws Tenant Out on Street in Retaliation for Initiating Class-Action Lawsuit
June 22, 2009 — badbizfinder

UDR (NYSE:UDR) THROWS TENANT OUT ON THE STREET IN RETALIATION FOR INITIATING A CLASS-ACTION LAWSUIT AGAINST UDR ON BEHALF OF CA TENANTS

In First Week 128 UDR Tenants Have Joined CA Class-Action Lawsuit Against REIT / Landlord UDR Inc for Uninhabitability, Illegal Leases, Oppressive Rules, and Fraud

On June 8, a Class-Action Lawsuit against Colorado-based REIT / Landlord UDR, Inc., on behalf of its California tenants, was initiated by Bad Biz Finder. As of June 18, 2009, 128 Tenants have joined the action and the consumer advocate group has received calls for help from UDR tenants in Washington, D.C., Virginia and Texas. Future class-action suits will be initiated in these states once a settlement is reached in the present case.

INTRODUCTION

Bad Biz Finder, a consumer advocacy group founded in Fremont, California in 1982 is filing a Federal Class-Action Lawsuit against UDR, Inc. on behalf of tenants that currently reside or have resided in one of UDR’s 48 California apartment communities during the period beginning June 30, 2007 through the present. The group is also seeking support from California State Senators on behalf of their renter constituents and is presently in talks with Senator Tom Harman of the 35th District that houses nine (9) UDR apartment communities.

Although this action is based on California law, it must be brought as a federal action because the prospective award amount will easily exceed $5, 000, 000 and all potential class members reside in California, a state outside UDR, Inc.’s principal place of business and state of incorporation. UDR is publicly-traded on the New York Stock Exchange [NYSE:UDR], is incorporated in Maryland, headquartered in Colorado, and maintains a subsidiary operating limited partnership, United Dominion Realty, L.P., registered in Delaware, to manage its California apartment holdings.

GUTSY TENANT STANDS UP TO CORRUPT UDR AND ORANGE COUNTY SUPERIOR COURT JUDGES

A UDR tenant, Erin Baldwin, courageously brought these issues to the forefront beginning in November 2008 via her tenant support group and blog, “Tenant Advocates of California” before it was shut down without her permission. As a result of her efforts on behalf of California tenants, she has been the target of unconscionable civil harassment, severe oppression and retaliatory actions by UDR, its agents, the Orange County Superior Court system, and UDR’s attorneys, Todd A. Brisco and Cynthia S. Poer. Among these actions, UDR towed her car and then sold it without cause and last week illegally evicted her and left her homeless.

Baldwin has been the subject of malicious prosecution by UDR through 3 unlawful detainer complaints during the past six months. On each occasion she mounted a rigorous legal defense on her own behalf, used public transportation to file documents, go to the law library, and attend court hearings. Despite the fact that her defenses prevailed on the first two complaints, she lost her defense after having Commissioner Richard E. Pacheco removed from the case for his personal and improper relationship with UDR’s attorney, Todd A. Brisco.

Post-Pacheco Baldwin’s matter was assigned to a long list of “judicial officers” who all mocked, ridiculed, trivialized and ignored the important causes of action Baldwin brought before the court and denied her right to a jury trial or any trial whatsoever. They included Orange County Superior Court – Harbor Justice Center’s Judge Derek Johnson who granted UDR’s Motion for Summary Judgment stating that Baldwin’s evidence was not competent and there were no triable issues of fact. Up to that point, Baldwin had been stifled for 2 months by Pacheco on every Motion, Demurrer and cause of action she brought with the following explanation, ”We’re in the pleading stage and those issues are triable issues of fact which you must reserve for trial.”

Supervising Judge Matthew Anderson was assigned the case after Pacheco was removed but wouldn’t hear anything as his Bailiff stated, “he doesn’t hear motions or demurrers.” He should have intervened but did not. Neither did Presiding Judge Margaret Anderson whom Baldwin had requested assistance.

Next on the roster was Judge Craig E. Robison who humiliated and abused his power by requiring Baldwin to stand before the Court audience and read a Reply to her Opposition for Summary Judgment that UDR had handed her minutes before. Robison told her to stand there and read it and be prepared to argue it. When Baldwin objected, Robison’s bailiff came and stood behind Baldwin jiggling his handcuffs. Robison ruled against Baldwin’s request for continuance, wouldn’t even hear the Motion for Summary Judgment, and told Baldwin to get ready for trial the following Monday.

Baldwin didn’t sleep that weekend as she thoroughly prepared for a jury trial and showed up ready to plead her case. That’s when she met Judge Derek Johnson who granted Summary Judgment and the trial that Judge Craig E. Robison ordered her to prepare for, never happened. When Baldwin requested an explanation from Judge Derek Johnson he refused to explain his definition of “incompetent evidence”; rather, advised her to “look it up for her appeal.”

It turned out that “incompetent evidence” defined the fact that all evidence (including a grossly overstated 3-Day Notice, grossly overstated Notice to Perform, and the fact that UDR had intentionally used an expired fictitious business name belonging to the previous owner of the complex to contract with tenants) was outlined in a Memorandum of Points & Authorities instead of a Declaration. This fact had no bearing on the merits of the case; rather, was a rookie in pro per pleadings error.

Baldwin came back the following Monday ex parte to stay the eviction pending appeal and waited 7 hours to be heard by Judge Karen L. Robinson who claimed to have read the foot tall stack of legal documents in the case in 15 minutes before she heard Baldwin’s motion. At 4:45 p.m., Judge Robinson told Baldwin that the only way she could stay the eviction was if she paid $8, 000 in the next 15 minutes. That was not an option available to Baldwin since she had been unable to secure ongoing employment due to the fact that UDR had confiscated her means of transportation. Judge Robinson had become a black-robed collection agency for UDR.

Baldwin also brought the matter to the attention of Orange County Superior Court’s Presiding Judge Kim G. Dunning two weeks prior to the eviction, put her off constantly and turned a blind eye to UDR’s illegal and fraudulent conduct as well as the unconscionable and collusory conduct of the judges involved. Her best suggestion to Baldwin was to check out a list of homeless shelters for women.

Baldwin’s fight continued until June 16, 2009, when she was unexpectedly and forcibly removed from her apartment by the Orange County Sheriff’s office after being promised by Kelli Beltran of Superior Court Operations that she would review the case and stay the eviction until such time. Baldwin was scheduled to meet with Beltran at Harbor Justice Center on June 23, 2009 at 1:30 p.m.
Nonetheless, Baldwin was evicted by Orange County Sheriff, T.J. Miller and was told she had 15 days to collect all the contents of her apartment. Dwayne Roberts from Orange County Superior Court Operation left Baldwin a message and told her the meeting she had on calendar with Kelli Beltran was cancelled as no evidence of impropriety was found in her case.

Less than 3 days after the eviction, it was reported by Baldwin’s neighbor and class-action member that UDR entered the unit and packed all of Baldwin’s possessions and moved them offsite in an unscrupulous attempt to collect and destroy all evidence, computer files, and documentation Baldwin had assembled to make her case and form the Class-Action Lawsuit. Four security guards stood watch over Baldwin’s apartment for those intervening 3 days and harassed any tenant fitting Baldwin’s description about where they were going and who they were.

Upon eviction, Baldwin went to the public library to email all class action members to ensure them that even though she is without a home, the fight will continue. Erin Baldwin will continue to be the primary contact advocate for this action as she has spent the past 8 months researching the legal causes of action, gathering evidence, interviewing tenants, witnesses and local, county and state officials to support the Class-Action. She also has the full support of all sixteen Bad Biz Finder chapters throughout the state of California.

Bad Biz Finder and Tenant Advocates of California are now working as one to compel UDR to reimburse past and present tenants via compensatory and punitive damages resulting from UDR’s: (1) intentional violation of California law; (2) its utter disregard for basic habitability standards and human decency; (3) violations of the California Public Utilities Commission (CPUC); (4) regulatory violations of the Securities & Exchange Commission (SEC); and (5) intentional fraud by way of misrepresentation, concealment and omission of material facts vital to forming a valid and enforceable contract.

Any clause in a California Residential Lease Agreement RLA that asks a tenant to waive its rights under the law and to agree to the contrary is unenforceable. This is the driving force behind this class-action lawsuit as well as the fact that UDR has deliberately capitalized on its tenants’ ignorance of the law. (California Code of Civil Procedure section 1670.5(a) and California Civil Code section 1953.)

THE PRELIMINARY CAUSES OF ACTION

(1) UDR Charges “Early Lease Termination Liquidated Damages” Penalties in Violation of California Law

California Civil Code section 1671 states that liquidated damages clauses in California residential lease agreements are illegal. However, UDR requires that its tenants not only waive their legal right under this law but also requires them to agree to pay a liquidated damages penalty fee equal to 2-1/4 times their base rent for terminating their lease prior to the end of the lease period, regardless of the month in which they terminate. In essence, UDR’s objective is to convince its tenants that it will take at least 68 days (2-1/4 months) to re-rent the vacant apartment as well as all associated marketing charges to advertise the vacancy.

In 1978, liquidated damages clauses were deemed illegal in residential lease agreements because landlords were distorting the true legal purpose or these clauses: “To set a flat fee when it’s impossible to determine the monetary harm that could result from a breach of the contract.” This doesn’t apply to UDR. They know (within a slim margin) how long it’s going to take to fill a vacant apartment as they use these statistics everyday to project sales and calculate expenses. UDR, Inc. is a publicly-traded company on the New York Stock Exchange (NYSE:UDR) and it could not sustain such a position if its financial projections were a mystery.

In order for UDR to maintain its average 95% occupancy rate, it must fill a vacancy within 18 days. Therefore, 50 of the 68 days they’re charging tenants for an early move-out penalty results in UDR collecting double rent on that unit – a violation of the law. If it actually took UDR 68 days to fill a vacant apartment, that time frame would be three times longer than the industry standard and they could not compete in the already crowded and historically highly-competitive California marketplace – particularly in light of the overwhelming number of foreclosures in California forcing ex-homeowners into the rental market.

Also, California law states that liquidated damages may not be used as a penalty or fee provision as follows: “Where a liquidated damages clause is seen as a penalty rather than an effort to agree upon a reasonable amount of estimated damages, the clause will not be enforceable.

(2) UDR Charges Late Fees That Are Overstated Contrary To Recent California Case Law and Rulings Thereon

As a result of the precedent-setting case, Orozco v. Casimiro [(2004) 121 Cal.App.4th Supp. 7], California deemed “late fees” within rental agreements to also be within the definition of liquidated damages, therefore ruling them to be subject to strict guidelines. Of course, landlords can collect late fees. However, California law specifies the manner in which the fee is to be calculated.

California Civil Code section 3302 states that the late fee amount cannot exceed the standard interest rate of 10% of the base rent (noncompounded) or 1/3650th of the base rent. For example, if the base rent is $1, 700, the daily interest would be $.47 per day (3650 divided by 1700) with a maximum late fee charge of $14.10 for any given 30-day period. UDR charges a flat fee of $50.00 which, according to California law, is grossly exorbitant and as such, UDR tenants are entitled to a refund of the difference.

(3) UDR Intentionally Contracts with Tenants Using False Names to Obtain & Sustain a Legal Advantage Over Its Tenants Resulting In Significantly Diminished Tenant-Based Litigation

UDR fails to properly identify the legal name of “Landlord/Owner” in its California RLAs, rendering the RLA invalid. In contract law, there are three important elements: the offer, the acceptance and consideration. Therefore, UDR must use the legal name it has set up for doing business in California (as it is an out-of-state corporation) to contract with tenants in California.

For example, the legal name of one of its apartment complexes, Villa Venetia in Costa Mesa, is “UDR Villa Venetia Apartments, L.P However, UDR’s RLA for that property identifies the Landlord/Owner as “Villa Venetia This name is not only factually incorrect but it’s not even a valid legal entity. Rather, it’s an expired fictitious business name that belonged exclusively to Vista Del Lago, LLC, the former owner of Villa Venetia. According to the Orange County Recorder’s office, the name expired on August 20, 2006 and UDR has knowingly and fraudulently used it to contract with tenants since the date it purchased the property in 2004.

UDR may not make an offer to rent a prospective tenant an apartment under an invalid legal entity; the parties must be properly defined in order for an offer to be effective. A UDR tenant would not know whether the legal name is on the RLA or not. Therein lies the fraud mentioned above as UDR has intentionally misrepresented, concealed and omitted a significant material fact required to form a proper contract. The law states that fraud renders a contract void, ab initio, or “from the beginning.”

The fact that a tenant has accepted the terms and conditions under the RLA does not relieve UDR of liability because UDR and its agents knew when they presented the offer that is was improper. A similar set of facts applies to all California UDR properties and we believe it is a conscious attempt by UDR to prevent tenants from exercising their Constitutionally-guaranteed right to file a grievance in a court of competent jurisdiction. If a tenant assumes the name represented as Landlord/Owner on the RLA is the proper legal name and goes to file a Complaint, the Court will reject the pleading for not properly stating the parties.

In addition, UDR fails to state the name, address and telephone number of the Agent for Service of Process on the face of its RLAs as required by California Civil Code section 1962. This further prevents tenants from locating the proper person or company to whom a tenant-based complaint would be served. As an out-of-state Landlord, California law requires that it states the name, address and telephone number of its in-state Agent for Service of Process on the face of its RLA. UDR fails to do so and as well, fails to maintain a complete corporate record on the California Secretary of State website also required by law.

(4) UDR Illegally Profits From Its Ratio Utility Billing System (RUBS) in Violation of California Public Utilities Commission’s (CPUC)

Regulation Prohibiting A Non-Utility From “Selling” Energy Or Water
UDR defers the cost of utilities for common areas, vacant units during repair and cleaning, property lighting, leasing offices, water for landscaping, swimming pools, and Jacuzzis, as well as its public laundry facilities to its tenants through its Ratio Utility Billing System (RUBS). UDR does not have a logistical need to do so as there are a sufficient number of residential energy and water meters at each of its 48 properties so as not to require tenants pay its utilities through a pro-rated billing system.

In its California RLA, UDR sets forth a “RUBS” calculation that its tenants must agree is fair and equitable and by which they must rely to calculate their “fair share” of the pro-rated utilities. Unfortunately, it is incredibly vague, uncertain and unintelligible due to the fact that all the formula’s variables are outside the control and/or knowledge of its tenants:

“Total monthly utility cost for the community (minus an allowance for common area use if applicable [which is not applicable in the present case]) divided by the number of persons residing at the community times the number of persons residing in the Premises using the applicable ratio multiplier [1 person = 1; 2 persons = 1.6; 3 persons = 2.2; 4 persons = 2.6; 5 persons = 3; each additional person, add..4 to the multiplier.”

In addition, UDR maintains another double revenue stream by not only charging its tenants to source the energy and water being supplied to the onsite public laundry rooms but by also charging them to use the coin-operated machines.

(5) UDR Illegally Defers Injury Liability Via Its “Hold Harmless” Clauses in Violation of California Law and Fails to Maintain Habitable Premises

UDR’s California RLA contains several “hold harmless” clauses creating a perception of justifiable negligence in its failure to maintain habitable premises including, but not limited to, vector control, water quality, construction defects, as well as tenant and guest safety standards for security, apartment, garage and vehicle intrusion, sexual offenders, theft, and violence.

According to California Civil Code section 1668: “All contracts which have for their object, directly or indirectly, to exempt any one from responsibility for his own fraud, or willful injury to the person or property of another, or violation of law, whether willful or negligent, are against the policy of the law.

(6) UDR Withholds Security Deposit Sums Via Illegal Fees and Penalties Which Must Be Properly Defined as Landlord’s Operating Costs and Responsibility

UDR’s California RLA Paragraph 37, “Resident’s Other Liabilities contains the following language: “In addition to all other obligations of Resident and remedies of Landlord under this Lease and the law, and to the fullest extent lawful, Resident shall be liable to Landlord for charges including, but not limited to sixteen (16) items that constitute fees and penalties that may be deducted from a tenant’s security deposit.

These items include such things as the leasing agent’s time to let a repairman into an apartment unit, replacing dead or missing smoke detector batteries, reasonable administrative charges for Landlord’s time and inconvenience for eviction of Resident, special trips for trash removal and so on. UDR is attempting to defer its operating costs on to its tenants and said costs do not represent legally sufficient deductions from a tenant’s security deposit. (California Civil Code section 1950.5)

(7) UDR Illegally Evicts Its Tenants and Acts in Collusion with the Orange County Superior Court Judicial System

Tenants that have been or are presently in the process of being evicted under the terms and conditions of UDR’s California RLA have significant defenses against this eviction.

If the terms and conditions of the RLA are deemed illegal under California law, and UDR has not named itself as a proper plaintiff, then UDR will have difficulty evicting a tenant under those illegal terms and conditions.

NOTICE TO ALL UDR CALIFORNIA TENANTS

For further information please send a request to Erin Baldwin at mailto:[email protected] with your full name, telephone number and preferred email address.

Or, you may visit our blog at http://badbizfinder.wordpress.com, find the link to your complex on the left side of the home page and leave the same information there.

Please note that no comments of this type will be posted in a public forum as we respect your privacy and all records will be held in the strictest of confidence.

ABOUT BAD BIZ FINDER

Bad Biz Finder is a consumer advocacy organization based in Fremont, California with volunteer-run chapters all over the state. In March of 2009, we set up a southern California hub center in Orange County to handle the overwhelming demand we are facing with our present cause: CONSUMER PROTECTION FROM LOAN MODIFICATION AND RENTAL LANDLORD FRAUD.

Our mission is to offer consumers a source of unbiased facts vital to making informed decisions about issues facing them every day. We seek to educate consumers about unethical, illegal and unconscionable practices so that those who have been harmed have a remedy, and those who have not, are warned.

Our roots go back to the early 1980s when our founder began to vocalize the vulnerability of consumers and the companies, individuals and agencies that preyed on this vulnerability. Over the past three decades, Bad Biz Finder has championed hundreds of causes and has been an agent for positive change so that the so-called “little guy becomes “a giant” with purpose and power.

Due to constant and unnerving legal and personal threats against the organization and its volunteers, Bad Biz Finder chooses to remain anonymous. Over the past 30 years, we’ve moved locations, changed our name, added an army of volunteers and called upon consumer rights attorneys to better serve the public.

Bad Biz Finder is self-supporting and asks for nothing in return. We do not accept payment, donations, or gifts, as we must remain objective in order to be helpful to consumers. We encourage the consumers we help to “pay it forward, ” and reciprocate by helping someone else for free. Every single day our organization helps scared and hopeless consumers gain footing again, armed with facts that empower them, and for that we are proud.