LIEB BLOG

Legal Analysts

Showing posts with label Tenant. Show all posts
Showing posts with label Tenant. Show all posts

Tuesday, December 24, 2019

New Law: The Return of the Yellowstone Injunction

Commercial Real Estate , Eye on Real Estate
New Law: The Return of the Yellowstone Injunction
On December 20, 2019, A2554 was enacted to "[p]rohibit[] commercial leases from including a waiver of the right to a declaratory judgment action and states that the inclusion of such a waiver in a commercial lease shall be null and void as against public policy."

New Real Property Law section 235-h took effect immediately on signing.

Welcome back Yellowstone Injunctions - it's like you never left us in the commercial arena. Commercial tenants facing eviction should consult with an attorney to get an injunction immediately before they are evicted.

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Saturday, December 21, 2019

New Law: Prospective tenants can obtain history of gas & electric charges incurred

brokers , Eye on Real Estate
New Law: Prospective tenants can obtain history of gas & electric charges incurred
On December 20, 2019, Senate Bill S3585 became law.

This bill's purpose is that it "[r]equires gas and electric utility companies to make available to any landlord and lessor of residential rental premises, upon the request of a prospective tenant or lessor of a residential unit, information concerning gas and electric charges incurred from prior occupants of the dwelling."

The bill's justification explains that "[p]eople should have the right to inquire from a gas and electric company the amount of the bills being paid for heat and electric service by the prior customer before they move into a residence. They should not have to rely on a landlord or homeowner's word about how much it costs to heat a residence."

This new law, Public Serivce Law section 66-p, is effective on 4/18/2020.

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Tuesday, November 12, 2019

No Certificate of Occupancy? No Rent, No Eviction Proceeding

A1646 , Certificate of Occupancy
No Certificate of Occupancy? No Rent, No Eviction Proceeding
On November 6, 2019, Governor Andrew Cuomo signed Assembly Bill 1646 into law. Assembly Bill 1646 amends the Multiple Residence Law and adds a new Section 302-a. The Multiple Residence Law applies to buildings with three or more units outside New York City.

Effective immediately, the new law prohibits the recovery of rent AND the commencement of an action for possession of a dwelling based on nonpayment of rent if the dwelling or structure occupied for human habitation does not have a certificate of occupancy or is not in compliance with the existing certificate of occupancy pursuant to Multiple Residence Law § 302.

The dwelling may be caused to be vacated for any nuisance or if it is occupied by more families or persons than permitted or is erected or occupied contrary to law. Such dwelling cannot be occupied until it or its occupancy has been made to conform to law.

Apart from a landlord being prohibited from recovering rent and possession of the premises through a nonpayment eviction proceeding, landlords should also be aware that violations may also be fined up to $500 or imprisonment up to a period of one year, or both.

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Monday, April 04, 2016

New HUD Guidance - The Intersection of Disparate Impact Discrimination and Criminal Background Checks

Discrimination , Fair Housing
New HUD Guidance - The Intersection of Disparate Impact Discrimination and Criminal Background Checks
Last year, the Supreme Court ruled that disparate impact discrimination claims are cognizable under the Fair Housing Act. For a refresher, read my blog post about the decision here. In sum, landlords may be liable for discrimination if the effect of a facially neutral housing action has a disproportionate impact on a protected class.

Today, the office of general counsel to the U.S. Department of Housing and Urban Development issued a memorandum offering guidance regarding the potential discriminatory effects of taking an adverse housing action against a tenant based upon their criminal history. A link to the memorandum can be found here. The logline for this memorandum is that HUD believes taking an adverse housing action based upon criminal history may constitute discrimination on the basis of race or national origin because of its disparate impact on those protected classes.

The memorandum examines the three-step burden-shifting test a court would analyze in a claim brought by a tenant who alleges they were discriminated based upon their criminal history. The stated purpose of the memorandum is facially neutral, addressing “how the discriminatory effects and disparate treatment methods of proof apply in Fair Housing Act cases in which a housing provider justifies an adverse housing action… based on an individual’s criminal history.” The practical effect of the memorandum, however, is that HUD has armed plaintiff’s attorneys with a new theory of liability that all landlord’s should understand.

The three-step burden-shifting test requires that a plaintiff first prove that the complained of practice has a discriminatory effect. If the plaintiff is successful, the defendant must then prove that the challenged practice has a legally sufficient justification. Finally, if the defendant proves a legally sufficient justification, a plaintiff must then prove that there is a less discriminatory alternative available. The HUD memorandum examines each question and attempts to offer guidance in turn.

Discriminatory Effect

HUD submits that national statistics stand for the conclusion that “[n]ationally, racial and ethnic minorities face disproportionately high rates of arrest and incarceration. Without drawing its own conclusion, HUD posits that these statistics, along with other evidence, could provide sufficient proof for the legal position that taking an adverse housing action, such as refusing to enter or renew a lease based upon criminal history, has a disparate impact on African Americans or Hispanics.

Legally Sufficient Justification

If a plaintiff is successful in proving that an adverse housing action on the basis of criminal history has a discriminatory effect on racial or ethnic minorities, a defendant would then be compelled to provide a legally sufficient justification for the action. In analyzing this factor, HUD acknowledges that “resident safety and protecting property are often considered to be among the fundamental responsibilities of a housing provider”. However, HUD does push back by requiring that a defendant submit evidence supporting the conclusion that a policy of discriminating on the basis of criminal history furthers the stated purpose of protecting residents and property. That is, a landlord cannot blindly rely upon this justification in every situation. HUD suggests that landlords consider each potential tenant on a case by case basis instead of having a blanket policy of refusing to lease to anyone with a criminal history

For example, HUD submits that the existence of a prior arrest, which does not carry a subsequent conviction, “has very little, if any, probative value in showing that he has engaged in any misconduct. An arrest shows nothing more than that someone probably suspected the person apprehended of an offense.” HUD concludes that “because arrest records do not constitute proof of past unlawful conduct… the fact of an arrest is not a reliable basis upon which to assess the potential risk to resident safety or property posed by a particular individual.”

Moving further, HUD submits that even a criminal conviction does not automatically create a legally sufficient justification. “A housing provider that imposes a blanket prohibition on any person with any conviction record – no matter when the conviction occurred, what the underlying conduct entailed, or what the convicted person has done since then – will be unable to meet this burden [of proving a legally sufficient justification].” HUD suggests that a “housing provider must show that its policy accurately distinguishes between criminal conduct that indicates a demonstrable risk to resident safety and/or property and criminal conduct that does not.”

Less Discriminatory Alternative

If a landlord proves a legally sufficient justification for the challenged policy or act, the plaintiff may still prevail by proving that a less discriminatory alternative exists. Here, HUD offers no substantiated guidance but submits that the analysis must be performed on a case by case basis. The only suggestion proffered by HUD is that a landlord may consider delaying a criminal history investigation until after a tenant has already qualified financially.

Conclusion

In the end, HUD has taken an aggressive position that all landlords must remain cognizant of when making housing decisions. When forming a policy of utilizing criminal background checks, a landlord should ensure that their policy is “tailored to serve the housing provider’s substantial, legitimate, nondiscriminatory interest and take[s] into consideration such factors as the type of the crime and the length of the time since conviction.” A landlord who has no evidence that its policy or action is grounded in nondiscriminatory justification will be vulnerable to complaints. 

At the very least, HUD has made it clear that blanket prohibitions on any person with a criminal history will face legal challenges based upon the Supreme Court’s upholding of the disparate impact theory of discrimination.
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Monday, December 29, 2014

Tenants of Properties in Foreclosure May Be in Trouble in 2015

Dodd-Frank Act , H.R. 3543
Tenants of Properties in Foreclosure May Be in Trouble in 2015
According to the National Low Income Housing Coalition (NLIHC), tenants comprise 40% of the families facing foreclosure.  In the past, many tenants did not know their homes were in foreclosure until they were forced to move out with little to no notice after the foreclosure sale date. Landlords had incentive to keep the foreclosure a secret from their tenants so that they could collect rent in the meantime. As a result, tenants had little recourse and were among the families hurt most by foreclosure.

In 2009, the Protecting Tenants at Foreclosure Act was enacted in order to protect tenants of properties in foreclosure from being evicted from their homes without due notice. Under this Act, a tenant had the right to stay in the property until the end of his or her lease unless the new owner intended to live in the property. If the property were to be owner-occupied, a 90-day notice was required before the tenant could be evicted. Month-to-month tenants also required 90 days’ notice. No longer were tenants forced to move out within a few days of being given an eviction notice.

The Protecting Tenants at Foreclosure Act was set to expire on December 31, 2012 but Section 1484 of the Dodd-Frank Act extended it to December 31, 2014. Two bills, S.1761 and H.R. 3543, were introduced in 2013 to permanently extend the Protecting Tenants at Foreclosure Act. However, neither bill has been passed, and it is unlikely that they will be passed in the next 2 days. It is possible, however, that the bills can be enacted retroactively in 2015.

Without this Act, tenants will not have the same heightened protections during the foreclosure process. It is imperative that a bill is passed to ensure that tenants are given due notice after a foreclosure sale date.
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