Five Or More Take-Aways From A Single Mailbox (Rule)

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There must be a backstory to the case Ruminations will look at today. But, first, we’ll ramble a little, touching on this ‘n that.

There’s a common law rule called the “mailbox rule” or if you are on the eastern side of the Atlantic in another English-speaking county, the “posting rule.” [The United States and Great Britain – two nations separated by a common language. Credit: George Bernard Shaw.] The rule says that, absent some other bar, an offer is accepted when it is presented to the postal service, put in the hands of a postal worker or placed in a mail box). Basically, absent saying otherwise, an offeror is deemed to have “appointed” the postal service as its agent for receipt of an acceptance. The risk of receipt is thus placed on the offeror. This rule applies in other situations, one of which is relevant to today’s story.

This is a good place to remind all readers to carefully review the Ruminations disclaimer at the bottom of the blog page. Today, our disclaimer clearly means that no reader should try to learn the law from our description of the “mailbox rule.” Our description is just a starting point for understanding its extent and, more importantly, its limitations. That having been said, don’t ignore that the rule exists.

Today, we’ll tell a story that came to our attention by way of a court decision out of a California court. So, here’s another tidbit. Most of us in the United States live in states that rely on “common law.” That’s law derived from custom and judicial precedent, beginning with British case law from before we became an independent nation. California was not an English colony; its law is derived from that in Spain. Spain’s law was based on a civil code; it was written. Judge-made law is less relied upon. In civil code states, statutes are King. So, in California, you wouldn’t have to research court decisions to see if there is a mailbox rule. All you’d need to do is look at California Civil Code section 1476, reading as follows:

If a creditor, or any one of two or more joint creditors, at any time directs the debtor to perform his obligation in a particular manner, the obligation is extinguished by performance in that manner, even though the creditor does not receive the benefit of such performance.

What’s the common link between this particular code provision and our explanation of the common law “mailbox rule”? We think it is that both rely on the same principle. When the intended recipient tells someone, by statute (the civil code) directly or impliedly (by common law), to mail an acceptance or a payment to a particular person or enterprise, that effectively treats the “receiver,” in our story, the postal service” as if it were the ultimate party. In our story, the landlord “appointed” the postal service as its agent to receive the rent. Yes, when a landlord authorizes payment by mail, the payment is deemed received when it goes into the mailbox or is delivered to a post office. It doesn’t have to arrive. It just has to be mailed. A lease may say otherwise. The lease in today’s story did not.

All right, we’ve stalled long enough and it’s now time to tell the story. Please don’t be disappointed that it concerns a residential tenancy. There are still lessons to be learned, even beyond the existence of the “mailbox rule” and beyond learning that some states are common law jurisdictions and others are civil code jurisdictions. As to the last point, if you are thinking that your form lease or something copied from the internet will receive the same judicial reception in all 50 states (and in the other United States jurisdictions), you haven’t yet absorbed that civil code jurisdictions only look like common law ones. Yes, the general laws are very similar, but there really are devils lurking in the details, and those details are the ones you might really care about, such as “remedies.” [By remedies, think: eviction and other things that have to do with protecting people from harsh results.]

A landlord asked the court to evict a tenant. It alleged that the most recent monthly rent payment, the one for September, had not been received even after it sent a (statutory) three-day notice to “pay or quit” to its tenant. That notice was delivered on the fifth day of the month (rent being due on the first day). So, if the notice was valid, the tenant could either pay up or move out by September 8.

In the court proceeding that followed, both the landlord and its tenant agreed that the landlord’s instructions were that rent was to be paid by money order and had to be mailed to a post office box.

Testimony was uncontroverted that the tenant bought a postal money order on August 31(there was a receipt). Further, the tenant presented the actual envelope used to send the rent. It was in unsealed condition and had a yellow sticker from the postal service stating that the envelope was undeliverable. [The court’s opinion gives no clue as to why it was “undeliverable,” but we assume that if it was misaddressed, the opinion would have told us whether that mattered.]

Of interest, but probably not a factor in the court’s decision, was that after receipt of the three-day notice, the tenant, without success, tried to contact its landlord five or six times by telephone. When contact was finally made after September 8, the landlord revealed it “had not yet had a chance to check the post office box.”

To sum up the landlord’s position, we’ll quote the landlord itself: “[We] never agreed that the mailing of the rent would constitute payment, whether the check was received or not.”

The court ruled in favor of the tenant. Applying the California Civil Code provision we cited (mimicking the “mailbox rule”), this is how the court put it: “When a creditor directs a debtor to mail payment, it is deemed that the payment is made when it is deposited in the mail. Otherwise, the payment is not effective until received by the creditor.” In fact, California case law informs us that, “[I]f the creditor [here, the landlord] directs the debtor [here, the tenant] to send him money by mail, the loss of the money in the mail is at the risk of the creditor [i.e., landlord].”

That’s pretty simple. The law would seem clear. So, did the landlord have any “equal and opposite” or, more significantly, dispositive, “law” to throw back at the court? Well, it tried. The landlord pointed to California Uniform Commercial Code section 3310 [a/k/a – UCC section 3-310]. We’re not going to quote it because it is somewhat lengthy and readers without a background in “reading” the UCC (that’s shorthand for the Code) may be befuddled. So, if you want to see it for yourself, just click: HERE.

The UCC, by its terms, appears to pre-empt (overrule) any other statute that would contradict or be inconsistent with the UCC. We say, “appears,” because, as we have written many times, reading agreements or statutes in a vacuum is pretty dangerous. One needs to “know” the entire body of law, not just be able to read one or even a few provisions without the benefit of context. In this case, the court rejected the landlord’s argument that the UCC overrode California’s form of the “mailbox rule.” [The court pointed to the official comments to the UCC, ample prior case law, and a public policy to the effect that laws written specifically to protect a class of people (here, being those who mail payments in response to a creditors requirement that payments be mailed) are hard to override by way of a general statement in another law.]

So, that’s yet another take-away from today’s posting: Don’t think you can cherry-pick a statute or a provision from a lease or mortgage or other agreement and “know” that you will “win.” And, Ruminations will go out on a limb by (strongly) suggesting that you think twice when an attorney tells you that you’ve got a “loser,” and not think yourself vindicated when you find an attorney who promises to get you a victory. Don’t blindly take any such advice, favorable or not. Find out “WHY” each attorney thinks as she or he does. One of them will turn out to be wrong. We have a natural inclination to believe the opinion that favors us, but is that the way decisions should be made?

As simple a story as today’s blog posting tells, here’s yet another nugget. Let’s look at our leases (and other agreements) to see what they say about “how” payments or notices are to be made. Do those agreements effectively say that posting the payment or posting the notice makes the payment or notice effective even if not received? And, that includes provisions that say mailings are deemed effective three business days later. [Readers might be interested in a prior blog posting, seen by clicking: HERE.]

Oh, yes, we promised to tell you the backstory. So, here goes (as best as we can speculate).

Readers already know this was a residential tenancy and that the “three-day notice” went out on the fifth day of the month. Here is some additional information. The rent was only $523.98 per month. September’s rent was the only “unpaid” rent. The tenant had always mailed money orders. There was no reference to a pattern of unpaid rent (though, we admit, there might have been a history, intentionally left unsaid by the court).

Oh, one more point. This was a 30+ year tenant, not one who just moved into the property.

To us, that adds up to a landlord who wasn’t interested in receiving its agreed-upon rent. It was interested in NOT receiving rent from a low-rent (probably rent-protected), very long-term tenant. It was willing to pay an attorney to take this matter to an appellate court against a tenant represented by a legal services organization. For those readers who don’t know, tenant legal service organizations are very, very good. They really, really know the law, much better than most private law firms.

We don’t fault parties who make a calculation that, despite long odds, the possibility of a favorable outcome makes a significant expenditure worthwhile. [For more about that, click HERE for an earlier blog posting.] Perhaps, this landlord knew it was facing long odds and decided the time and money was worth spending. But, more often, no such analysis is made. Parties want what they want, when they want it, and will hire someone who promises them “success.” If not “promises,” then gets them to “believe” that a favorable outcome is near-certain.

Here’s another take-away for today, the fifth or sixth from a simple landlord-tenant dispute – pretext doesn’t work very often. Today’s story is an example of that principle. It couldn’t have been that the landlord wanted to evict its 3- year tenant because the rent didn’t arrive by the fifth day of the month. The tenant clearly had the rent in hand. It paid the money to the postal service before the month in question. The landlord could just have said, “Mail it again.” Sure, the “returned” envelope didn’t show up for weeks because that’s how returned mail works. But, when it showed up back at the tenant’s mailbox, the landlord could have been gracious, accepted the sealed envelope, and withdrawn its eviction action. Instead, it went on to lose in the lower court and then unsuccessfully appeal that decision. Judges aren’t stupid. They know what’s going on. Timewise, the dispute was about the rent for September, 2015, and the appellate court filed its opinion 19 months later. For those who want to see the actual appellate court decision, just click: HERE.

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  1. George Vaill says:

    WOW! Another opportunity for me to be happy that I never went to law school. Life is confusing enough without all this gobbledygook. Not sure how you brainiacs go even one day without your heads exploding in a ball of fire.

    I’m not competent to comment on the content of this Rumination as to the legal aspects. However, I’ll put something out there that is (somewhat) related to the practical aspects of “notice” delivery. First, to the degree that, in any given (lease) situation (and for any reason that the “mailbox rule” may not apply), “proof” associated with the giving and receiving of “notice” seems to me to be pretty important. Therefore, I reject the idea that any legal addressee can safely rely upon a “notice” that is to be “hand delivered” or delivered “in person” to someone sitting at a reception desk (as is commonly stated in lease “notice” provisions), as sometimes those who are at the front desk to whom such a notice might be “delivered” are less than studious when it comes to assuring control over and prompt and effective delivery of such a notice to the addressee. The phone rings, people get distracted, and the notice gets lost in the shuffle of other paperwork on the desk. Tick Tock! Timely response required is not met. Trouble ensues. It might seem to some to be a minor point. But official notices usually address serious issues, too serious in my mind to be allowed subject to potential carelessness.

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