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Evicting a Commercial Tenant: Medical Marijuana Dispensaries
In recent letters sent to landlords of medical marijuana dispensaries, the Drug Enforcement Agency (DEA) has informed landlords that the sale of medicinal marijuana is illegal under federal law. The DEA asserted its right to confiscate the landlord’s property, in accordance with the law of civil forfeiture.
Can landlords evict medical marijuana dispensaries based solely on the DEA letter? Pot clubs are “commercial tenants,” not private residents. In business agreements between “merchants,” the law assumes that both parties are sophisticated, such that they should know about the contracts they sign. So, if no provision is included in the lease about illegal activity, the landlord may not have an obvious reason for eviction.
An eviction is a state proceeding. Under California law, medical marijuana dispensaries are legal, but under federal law, they are not. However, a California court would probably authorize an eviction in this case, since a raid by the DEA could have profound effects on the landlord’s property. For example, in 2007, the DEA closed an Oakland pot club, confiscated the landlord’s property worth almost $400,000, and he was sent to federal prison.
On the other hand, a California court may be hesitant to undermine the authority of state law allowing medical marijuana dispensaries. Despite the DEA’s letters, to date no landlord keeping a “low profile” has had his property forfeited. The court may consider whether the DEA has the resources to do so. The DEA has only charged people with direct involvement in the cultivation and sale of marijuana, and those who made large profits. In the case above, the landlord knew of the illegal activity, and even “controlled and directed” it at certain times.
An attorney for a medical marijuana dispensary landlord without an illegal activity clause in the commercial lease may advise the landlord to apply for a “writ of possession” at the superior court.
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