A discussion of routine & complex issues which confront all types of shared ownership communities.

Condo and HOA Law Blog By Donna DiMaggio Berger, Esq.

Condo and HOA Law Blog By Donna DiMaggio Berger, Esq.
This blog covers every topic under the sun related to condominiums, cooperatives, HOAs, timeshares and mobile home communities from the unique perspective of attorney Donna DiMaggio Berger.

Wednesday, May 18, 2011

Should associations evict tenants who don't respond to demands for rent and how is it done?

Assuming that last year's statutory right to collect rent from tenants in delinquent properties(SB 1196) and this year's clarification that full rent can be demanded (HB 1195) withstand both TCR v. Windsor West and Cohn v. Grand type challenges, should associations be routinely evicting those tenants who do not heed their demand for rent?

To evict or not to evict?

First and foremost, when it comes to evicting tenants who don't tender rent to the association, the board must remember that evicting such tenants costs money and the eviction will not result in the association being paid. If the objective behind proceeding with an eviction is to set an example to other delinquent owners and tenants or to satisfy residents who are upset that there are tenants in delinquent properties that are not tendering rent to the association that is one thing. Also, if a tenant is disruptive or causing problems in the community, then the eviction can be a worthwile expdenditure of funds. However, if none of these non-economic factors come into play, the board may prefer to wait for the foreclosure process to ultimately remove the tenant(s) rather than to incur additional costs with a separate eviction action.

Now, if the board wants to set an example or remove a disruptive tenant, how does it go about evicting the tenant?

The specific process begins after a statutory demand for rent has been made. The eviction process commences with the service of a 3-day notice. That notice can be served by mail, posted on the property or served by a process server. Although service by process is not required, we usually serve the 3-day notice by process on both the tenant and the owner. The 3-day notice must specify the amount of the monthly rental rate and the exact amount of total rent owed to date. The association should have a copy of the lease to confirm the rental rate. A copy of the lesae also serves to establish that there is a tenancy (so that the tenants cannot try and claim that they are merely guests and not paying tenants) and further serves to identify all tenants.

If the association does not have a copy of the lease and does not know the rental rent, some will still proceed by listing the amount of the monthly maintenance instead of the amount of rent on the 3-day notice. This is a somewhat aggressive approach that could be challenged but my firm (and others) have successfully utilized such an approach.

If full payment to the association is not made within three business days after service of the 3-day notice, the association may file an eviction complaint. The complaint is served on the owner and tenant by service of process and those parties have 5 business days to file a response to the eviction complaint (this is a summary proceeding which is why the typical 20 days to respond to a lawsuit does not apply).

If the tenant wishes to challenge the eviction on any basis other than the claim that they have already paid the rent to the association, the tenant must deposit the amount of rents being demanded into the Court's Registry; failure to do so will result in a default. Since most tenants are unlikely to do this, most of these evictions are unopposed. If the tenant fails to answer the complaint and/or deposit the disputed rents, a default final judgment can be obtained (usually by mail and without the need for a hearing) and a Writ of Possession will be issued. The Writ of Possession is then sent to the Sheriff who will then contact the association manager (or whomever else is listed on the Writ) to make an appointment to serve the Writ and oversee the changing of the locks on the property's doors. Thereafter the association should immediately write the landlord/owner and advise that it has keys for the new lock that may be retrieved.

The entire process for an unopposed eviction typically takes 6 weeks depending on the availability of the process server and the judge and costs approximately $1,700 to $2,200 again depending on certain variables.

After having his or her tenant evicted for failing to tender rent to the association, the hope would be that the delinquent owner won't start the process all over again with a new, unwitting tenant but sadly, that is usually exactly what happens.

This work by Donna DiMaggio Berger, Esq. is licensed under a Creative Commons Attribution-NoDerivs 3.0 Generic License.

6 comments:

Louis said...

Yes, I really think they should evict them. Tenants should always respond to the demands for rent.

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Karl said...

I really think that business is business. If there's a deal involved, tenants should definitely respond.

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Chris said...

Both tenants and the property owners have their rights. If all legal effort have already been exhausted, yet the tenants fail to abide by the agreement, then the law must be implemented.

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Anonymous said...

I disagree completely with all of the above comments. The landlord is responsible for paying their HOA / Mortgage etc. not the tenant therefore why should the tenant pay off the landlords debt? I agree with the fact that most associations may not evict for the simple reason that it will cost them $2200 and they won't get there HOA fees anyways. From strictly a business decision that makes no sense.

Donna DiMaggio Berger, Esq. said...

The problem has been that investor owners continue to collect rent from paying tenants while refusing to pay their fair share of assessments to the association. The law was changed to allow associations to step in and collect that rent until the landlord/owner becomes current. From a tenant's perspective, it makes little difference if it is tendering that rent to the association or directly to the delinquent owner. The tenant still has rights under the terms of its lease and so long as the association is getting the rent, the tenant will most likely be able to continue enjoying the use of the common areas and amenities. The reason this is being done is to give delinquent landlords incentive to keep current on their assessments.

Anonymous said...

It should matter to the tenant as to who they pay. As a licensed property mananger, I still have to have money in the account to get repairs done for the tenant. I'm the tenant's best way to get emergency type repairs done quickly because contractually, I can use the rent money to maintain the property for the tenant. No rent, I'm limited and at the mercy of the property owner to pay directly for a repair or to wire funds immediately. The HOA is not going to do their repairs. Often times, these HOA board members(aka the tenant's neighbors)are mean and conspiring to get rid of certain types of renters. We've also heard from tenants that HOA management companies are mean sprited when tenants attempt to follow up on notices they post.

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