california fraud lease
Roommate Got Their Name off the Lease by Misleading
<p>This is a major edit of a question which had number of ambiguities. Hopefully, the edits will clear the ambiguities.</p>
<p>So, A, B, and C were co-tenants on a lease in an apartment in California and A, B, and C used to pay the rent together to a landlord. And co-tenant A wanted to move out of the place. So A convinced B and C that if as co-tenants A,B, and C sign the new lease identical to the original without A's name on it (effectively &quot;removing&quot; A from the lease), A would in exchange, provide postdated checks to the landlord for the next three months of &quot;A's portion&quot; of the rent, plus the lease change agreement fee. So B and C signed the new lease without A on it.</p>
<p>Note that here, A's agreement to pay &quot;A's portion&quot; (which technically isn't spelled out in the lease) of the rent was only communicated to B and C, and not the landlord. In fact, for the lease change, the landlord did not inquire nor care about who will pay how much - just that the rent for the place were to be paid by somebody (including possibly those outside the lease).</p>
<p>Soon after A moved out, B and C found out that A in fact, asked the landlord to give A back the postdated checks, and B and C are the only ones obligated to pay the upcoming rent.</p>
<p>So in summary, what's remaining are 1) the new lease which is identical but without A on it, and 2) rental obligations of B and C (which are now increased), and 3) some traces of A saying that A will pay to the landlord &quot;A's portion&quot; of the rent after the lease change.</p>
<p>From some of the answers to the original question, there seem to be contract between A and (B and C) for paying &quot;A's portion&quot; of the rent, and another contract, the new lease between (B and C) and the landlord.</p>
<p>What legal actions do B and C have against A? And which actions are likely to succeed?</p>

<h2>B and C have a contract with A</h2>
<p>In return for paying 3 months rent, B and C will remove A from the lease. This has all the required elements to be a <a href="https://law.stackexchange.com/q/6263/344">contract</a>.</p>
<p>B and C have fulfilled their obligations and A hasn’t. B &amp; C could sue A for damages.</p>
<p>They would need to prove that there was such an agreement and that they agreement was a legally binding contract. Is this agreement written down? Was it witnessed by impartial third parties? What evidence of this agreement do you actually have? If A says they agreed to X, yet B &amp; C say they agreed to Y: what evidence exists to show who is right and who is wrong?</p>
<p>Failing to fulfill the obligations of a contract is not fraud. For there to be fraud, B &amp; C would have to prove that A never intended to comply by the terms of the agreement. Given that the terms of the agreement are somewhat ambiguous, this would be very difficult. This seems to be more of a case where [Hanlon's Razor]: &quot;Never attribute to malice that which is adequately explained by stupidity.&quot; That is, A's actions are more likely to be the result of a misunderstanding (by A, or B &amp; C, or both) than a deliberate plan of deception.</p>
<p>The landlord is not involved - they removed A from the lease at the request of A, B &amp; C; they’ve done what they’re required to do.</p>

<p>have (jointly) entered into an agreement with A. In this agreement, B&amp;C agree to request the Landlord (L) to modify the lease so as to omit A and make only B&amp;C (and L of course) parties to the modified lease, at the same total rent. They also agree to sign and accept the modified lease. A agrees to pay a part of the rent for a period of three months, via post-dated checks, when the modified lease would not require him to pay this.  This is a contract, whether it is written or not. (Apparently it is not written.) L is not a party to this contract.</p>
<p>When A  retrieves his post-dated checks from L, s/he breaches this contract. (If he does not make payment by the agreed date, A even more clearly  and seriously breaches it.) B&amp;C have a cause of action for this breach against A. If they prove the statements in the original question, they should get the full amount of A's agreed payment, plus any additional amounts caused by the breach, such as court costs, perhaps legal fees, and interest if B&amp;C had to borrow to make their rent payment. In short they should be put in the same financial position that they would have been in had A kept the agreement.</p>
<p>@Iñaki Viggers says this is also fraud on the part of A. If A intened, when the agreem,ent was made, to reneg on the agreement by reclaiming the checks, and did not intend to pay the agreed amounts, that would indeed be fraud. But if A agreed in good faith, but only later decided not to pay, that weould be an intentional breach of contract, but not fraud. Proving fraud might be hsrd, while proving breach of contract should be much easier. Proof of fraud would entitle B&amp;C to additional damages.</p>
<p>It has  been suggested that B&amp;C can rescind their agreement with A, therby putting A back on the lease.  But since L is not a party to this contract, L cannot be required to retract the modified lease. If I am correct about this, B&amp;C have done an irrevocable act, and thus cannot rescind, but must seek damages or equitable relief instead.  (For L to be a party, there would need to be facts not stated in the question, such as L being notified that the agreement was conditioned on A's post-dated payment, and L's agreement to accept this.)</p>
<p>In any case, it should be noted that most leases with multiple tenants make all tenants &quot;<em>jointly and severally liable</em>&quot; for the total rent. If this is true here, L could proceed against B&amp;C or either one of them, for the entire rent, even if A had remained on the lease, and might well do so if A had moved away, particularly if A had moved out of state. Thus the position of B&amp;C is not seriously improved by putting A back on the lease, even if it were possible to do so. The lease is unlikely to recognize any individual &quot;share&quot; of the rent that is less than the total rent.</p>

<p>Get all your text messages, emails, etc. together and explain the situation to someone new using those documents as the evidence of each element of your agreement with A. If you can demonstrate the actual terms of your agreement that everyone acted upon using these writings and only filling in gaps that are not material (vital) to your dispute, then you can win in small claims court. Its possible you will get a judgment against A if you can show the judge that A committed to something, even though you didn't have the foresight to use a real contract. Collecting on a judgement may pose a new challenge. It may be enough to just remind your friend that if you were to file a lawsuit the case could get on their credit reports, background checks, etc. and that you intend to collect on the judgment and would be able to do so for the rest of their life.</p>
<p>In 20 years this will seem petty and insignificant and its more important how you treat people in life than who owes who what so keep that in mind and don't let this get the best of you. If money is tight, California renters are currently protected by the Covid-19 Tenant Relief Act of 2020 <a href="https://leginfo.legislature.ca.gov/faces/codes_displayText.xhtml?lawCode=CCP&amp;division=&amp;title=3.&amp;part=3.&amp;chapter=5.&amp;article=" rel="nofollow noreferrer">Code of Civil Procedure section 1179.01</a></p>

<blockquote>
<p>What legal actions do B and C have against A?</p>
</blockquote>
<p>Your description sounds in claims of fraud (provided that B and C incurred <em>actual</em> losses), and, in the alternative, breach of contract. At the very least, B and C are entitled to (1) rescinding their contract with A, (2) rescinding the modification of the lease, and (3) recovering from any losses incurred so far as a result of A's course of conduct.</p>
<p>Although there is no <em>written</em> contract between A and B&amp;C, the sequence of events evidences the existence of a contract. Modification of a joint lease, A's moving out, and A's retrieval of his postdated checks don't typically happen just by chance.</p>
<p>It seems hard for A to persuasively explain why he issued postdated checks at once, especially if (?) it was not A's habit to do so. Likewise, the issuance and amount of the postdated checks defeat A's possible allegation that pure and sole kindness prompted B and C to release A from their contract with the landlord.</p>
<p>A's retrieval of his postdated checks is tantamount to rescinding his contract with B and C, since A is withdrawing the consideration that was required of him. Equivalently, the contract is voidable by B and C because it was made on the basic assumption --and indeed the obvious presumption-- that A would not approach the landlord unbeknownst to B and C to upset the agreed exchange of performances. See <a href="http://www.oneclubofjusticides.com/p/restatement-second-contracts.html" rel="nofollow noreferrer">Restatement (Second) of Contracts</a> at §153. Either way entitles B and C to the conclusion that the modified lease is null and void.</p>
<p>Your description also suggests the legal theory of fraud and the availability of treble (or even higher) damages. See <a href="https://www.leagle.com/decision/200410314calrptr3d89197" rel="nofollow noreferrer"><em>Bardis v. Oates</em>, 14 Cal.Rptr.3d 89, 106, 108 (2004)</a> &quot;<em>California typically imposes treble damages penalties for fraudulent and bad faith conduct</em>&quot;. Regardless of the availability of common law fraud under California law, A's conduct is tantamount to &quot;writing a dishonored check without good faith dispute as to the debt&quot;. See <em>Id. at 106</em> and <a href="https://leginfo.legislature.ca.gov/faces/codes_displayText.xhtml?lawCode=CIV&amp;division=3.&amp;title=&amp;part=3.&amp;chapter=&amp;article=" rel="nofollow noreferrer">section 1719(2) of California Civil Code</a>.</p>
<p>Intent is an element of fraud. See <a href="https://www.leagle.com/decision/1995123610cal4th122611231" rel="nofollow noreferrer"><em>Alliance Mortgage Co. v. Rothwell</em>, 10 Cal.4th 1226, 1239 (1995)</a>. My understanding is that A sought retrieval of his postdated checks <em>after</em> the lease was modified and/or in a way calculated to prevent B and C from advising the landlord not to return the postdated checks to A. If so, that timing makes it relatively easy to establish A's intent to defraud.</p>
<p>It is unclear from your description whether the element of <em>resulting damages</em> (see element (5) in <em>Alliance Mortgage</em>) has already materialized. If it has not, B and C should still pursue A's honoring of the contract. Although allowing losses to incur for the purpose of accruing treble damages sounds tempting, doing so is likely to backfire because it would constitute <em>invited error</em>, thereby defeating the otherwise meritorious claims B and C might have.</p>
