LANDLORD RIGHTS & COVID-19
COVID-19 has been a crisis for everybody in many ways. In the realm of landlord-tenant law, its impacts have been major.
Due to the widespread economic dislocation and unemployment caused by the shutdown and quarantine, Governor Murphy has created a yearlong Eviction Moratorium, in order to protect those tenants who have been displaced and impoverished as a result of the Pandemic. As a result, all eviction trials have been temporarily suspended within the State of New Jersey.
As a result, many landlords (especially small mom & pop, and individual proprietors unaffiliated with large property management corporations) are in a panic. They are stuck paying mortgages (with interest) as well as property taxes and utility bills on properties that are basically frozen in limbo. While it is ethically permissible for economically devastated tenants to benefit from the Moratorium, it is unacceptable for other tenants (who remain gainfully employed) to game the system in order to not pay rent. Unfortunately, we are seeing this situation far too often.
Fortunately, the Court system has created a path forward for hurting landlords, so that they can save their hurting properties and damaged finances.
On July 14th, 2020, the N.J. Supreme Court carved out an exception from the Governor’s broad COVID-19 Eviction Moratorium. This Order did the following things:
Landlords are now permitted to file eviction complaints, but the trials will be postponed until such time as the Court sees fit (when the epidemic is over);
Landlords’ Complaints will NOT be dismissed in the meantime due to “lack of prosecution” or “lack of service” (which would normally impact eviction complaints that linger in the system without a set trial date or service of process;
Permitting Landlords to file evictions in limited circumstances through the filing of an ORDER TO SHOW CAUSE.
ORDER TO SHOW CAUSE
According to the July 14th, 2020 Order by the N.J. Supreme Court, landlords are still permitted to file eviction complaints, and have eviction trials, provided they do so within the context of an ORDER TO SHOW CAUSE.
An Order to Show Cause is a special type of complaint that is filed in emergency situations. It gets the Plaintiff in front of the Judge very fast, and often grants relief in an expedited basis. However, Landlords CANNOT use this type of complaint if their only issue is non-payment of rent. Indeed, the Supreme Court expressly prohibits Orders to Show Cause from being filed in non-payment cases.
While the grounds for filing an Order to Show Cause are broad, the Court has given us guidance as to what kinds of issues would qualify for emergency treatment. For example, they are permitting such evictions when the landlord can show that there has been violence against other tenants, criminal activity, extreme damage to residence, or death of a tenant resulting in the vacancy of the rental unit, or any other ground that would permit eviction to take place “in the interests of justice” under Executive Order 106.
If you are a landlord and have non-paying tenants or squatters living in a residential rental property, you may be able to take advantage of these relaxed rules in order to salvage your home and your finances.
COMMERCIAL PROPERTY & COMMERCIAL EVICTIONS
The N.J. Supreme Court has also clarified the path-forward for Commercial Landlords, who have also suffered greatly under the current Eviction Moratorium. In its Order of February 5th, 2021, the N.J. Supreme Court stated that Commercial Evictions could take place in the following circumstances:
Must be pursuant to an Order to Show Cause, rather than a normal eviction complaint (as with residential evictions, listed above)
If for Non-Payment of Rent, the Landlord Must show that said non-payment threatens the landlord’s capacity to continue their business (as in the case of a pending foreclosure or tax lien);
If the situation in #2 does not apply, then the Landlord must be able to show that there is an emergency or “emergent” circumstances, such as violence against other tenants, criminal activity, extreme damage to residence, or death of a tenant resulting in the vacancy of the rental unit
An additional emergency situation that will be considered by the court will be when there’s a permanent closure of a business that results in the vacancy of the commercial unit.
LAWSUITS
Another option that both commercial and residential landlords have at their disposal is to use the lawsuit mechanism of the court system to lock-in a judgment for a set amount of money. Our firm has had great success with this tactic against working tenants who have suffered little to no negative repercussions from COVID-19. Here, the landlord files a lawsuit for the total amount of rent currently due. As the tenant is living in, or doing business in the rental unit, acquiring service of process is relatively easy. As the agreement between the parties is purely contractual, these cases are relatively straight-forward affairs, provided that the landlord is living up to their side of the contract and is not violating any laws, or the implied covenants of habitability or quiet enjoyment. If the amount due is a substantial sum, then a Judgment by the Court, and recording same with Trenton, provides our clients with a certain degree of security against being taken advantage of by working, non-impoverished tenants. Of course, if the tenant truly isn’t working and has been legitimately and grievously harmed by the Pandemic, then your likelihood of prevailing here is greatly diminished (and rightly so). In such a case, your best bet might be to seek alternative forms of relief through your bank, lender, or pertinent agencies of county or state government.
Regardless of your unique circumstances, you are not “out of luck,” and without recourse. The law still provides major avenue of relief for many landlords. If you are a landlord and are facing financial ruin or devastation as a result of the eviction-moratorium then contact my office today at 856-873-3730 for a Free Consultation.