Articles in This Edition:

• Go on the OFFENSIVE with sex offenders.

• Accommodating the "stip" tenant during tough economic times.

• The privilege is yours - exercise it.

• Evaluating your attorney's performance.

Go on the OFFENSIVE with sex offenders.

The phone rings…it’s the police department.  Sgt. Smith tells you that a sex offender recently moved into your property and properly registered this address with the State.  The department now would like your help letting everyone in the community know of the offender’s presence.  Sgt. Smith asks you to distribute flyers around your property because there is a registered sex offender living in apartment 25.

Don’t think this doesn’t happen just because you haven’t received the call…yet.  You will.  Ask your peers if it really happens.  Then, make sure you are prepared to handle the call when it comes.  Better yet, do what you can now to reduce the likelihood that it will happen in the first place.

There are three main scenarios where we are seeing this happen: 

• First, an existing resident has an offender move in, with our without your approval, who then registers their new apartment with the State. 

• Second, you have a lease with an organization or company that does not allow you to screen the actual occupants the “tenant” puts in the unit. 

• Lastly, and probably the most avoidable, is a poor screening effort that allows an offender in as a tenant under the lease.

So, let’s talk about avoiding or reducing the likelihood of getting this call first  Not allowing an offender to move into your community under the lease is as easy as ensuring your screening efforts, whether conducted by your staff or by a third party vendor, include a complete check of the Sex Offender Registry, not just criminal history.  While such crimes should appear on the criminal background screen, it is well worth the additional time or money, which should be minimal, to verify that your applicant is not on the list.

Screening all occupants who will live in your community under a “corporate” lease must be part of your policy and procedures.  In fact, it should also be part of your lease.  We have seen leases that actually prevent the property owner or manager from screening unit occupants.  Sometimes the “corporation” will not sign the lease if the occupants will be screened.  This situation should be a huge red flag concerning the lease you are about to sign.  There are advocates and sympathizers who assist sex offenders in finding places to live when they are released from prison.  Since the offenders face many hurdles getting a lease in their own name, the advocates form companies that will obtain a “corporate” lease and place the offenders in the units they have secured.  If you do not want sex offenders on your property, don’t sign these leases or insist that you be able to screen every proposed occupant before the person moves in.

Preventing an existing resident from allowing an offender to move in is as difficult as keeping their mother-in-law out of the unit.  It requires diligence on the part of you and your staff in ensuring the authorized resident does not allow unauthorized occupants.  We’ve given seminars where the entire conversation concerned strategies for unauthorized occupants.  All of those strategies apply here, with one small advantage.  If you learn of the offender on your property because Sgt. Smith called, your proof of unauthorized occupants is only a Google search away.  An offender who registers their address on your property has made proving they live there a whole lot easier.

Now, you get the call…what do you do?  Politely decline to assist the police in their information campaign.  You will get arrested and sued if you assist in any way.  If the police push the issue with you, ask them for a phone number so that you may call them back and immediately contact your landlord attorney.  Besides helping you with the call, your landlord attorney can help you set up the proper way to not only handle the call, but the situation you just discovered from the Sgt. Smith.   [TOP]

Accommodating the "stip" tenant during
tough economic times.

These are tough economic times for landlords and tenants.  Many commercial and residential landlords are experiencing increased vacancies.  In addition, while commercial tenants are experiencing declining business revenues, many residential tenants are losing hours at work (or their job entirely) - undermining both groups’ ability to deal with unexpected expenses when it’s time to pay the landlord.  This situation often leads to a clash of business objectives – a clash that may cause the landlord to ask – do you evict the tenant or allow him/her extra time to pay? 

This question is particularly acute for landlords who have already been to court with a tenant on a nonpayment of rent case, and the tenant is now under a stipulated judgment (commonly referred to as a “stip”) requiring monthly use & occupancy and/or arrearage payments on-time and in-full.  We are increasingly receiving the following questions from landlords regarding whether they can be flexible in enforcing the stip’s payment terms without losing the stip’s long-term benefits: 

Question: Do I “amend” the stip if I allow the tenant an extra day or two to make the payment required?

Answer:  No.  You are simply giving the tenant the chance to remain in their apartment and get back into compliance with the stip, rather than face an affidavit of noncompliance and possible eviction.

Question: Can I still pursue an affidavit of noncompliance and seek to evict if the tenants do not make their next payment on time and in full?

Question: If I allow extra time to make a payment, does the tenant gain the ability to reopen the case and go back to court? 

Answer: No.  Keep in mind that a tenant can always file a motion to open judgment, regardless of what you do or do not do, so do not let that worry you.  While possible, the tenant faces slim odds for getting the judgment opened due to their failure to comply with it.  Either way, if you have a solid, broad legal fees clause in your lease, the tenant will be responsible for all of your attorney’s fees and costs experienced in dealing with the motion to open judgment, which will also act as a deterrent to the tenant pursuing this route. 

A landlord can face risk in this situation by consistently failing to act against the tenant for stip violations over an extended period.  For example, if the landlord allows the tenant to pay late every month of the stip, the landlord will probably face challenges in court if the landlord seeks to enforce the stip against a tenant for late payment in the stip’s final month.  In theory, it should not matter.  However, as with any situation involving judges at the trial court level, there is an element of practicality that the landlord must consider, because the only option to address an adverse ruling from the trial court judge is an expensive and time-consuming appeal. 

In summary, landlords retain their flexibility to enforce the stip just as they have the flexibility to enforce the lease against the tenant.  Nonetheless, landlords should save their flexibility under a stip for the “good” tenants – those who have historically paid on time and in full, and ran into some unexpected problem that led them to court and, later, led to a delay in a stip-required payment.   

The privilege is yours - exercise it.

One of the most important things you can do when engaging an attorney is share information.  Since we are nearing the end of football season, I’ll use a football analogy… 

You are the coach.  Your attorney is the quarterback.  The offense heads out onto the field with a single purpose – score a touchdown to win the game.  The team lines up.  The quarterback yells the cadence.  The ball is snapped and the entire offense goes into an orchestrated array of maneuvers.  The linemen are blocking.  The receivers are finding weaknesses in your opponent’s secondary.  Your running back is staring at a hole in the line he could drive a herd of cattle through.  There’s only one problem.  You didn’t tell your quarterback what the play was.  And worse, nobody is telling him that coming up from behind is an unblocked defensive end.  Your quarterback may be able to pull off a successful play, but the question is whether he will get blind-sided first.

Your attorney will serve your interests and achieve your goals most effectively if they know more about what’s going to happen in court than your opponent - whether a tenant or someone else.  Now, as for the court process, they should have that pretty much sewed up.  Getting you around the courthouse efficiently is one reason you hire them.  The details of the situation at your property, both with the tenant and in the office, are where you come in.  You have information about what is going on with the tenant.  For example, let’s take the tenant who is continually playing loud music and disturbing everyone around them.  How many people have complained?  How many have complained in writing?  How many are willing to testify in court about the disturbance to the neighbors?  How many times has this tenant created this nuisance in the past?  All of these things are important to know and may be somewhat obvious.

Here are some other things that may not be so obvious: 

• The problem tenant has been complaining about the noise from another tenant for two months.

• The problem tenant has been without heat and hot water for a couple days because the company you hired to fix the problem claims the parts they need are on backorder. 

• The problem tenant has been in your office every other day for the last two months disturbing your ability to get through your workday and taking an inordinate amount of your time.  Your maintenance personnel tell you the tenant refuses to allow them to enter the unit at the scheduled appointment every time they show to complete a work order.

And, here are some things you might otherwise believe are absolutely irrelevant to addressing the tenant’s noise problem: 

• Your company has just put the property on the market for sale. 

• Your company is under fire in a Midwestern state for your policy on lease termination clauses. 

• Your company is refinancing its mortgage on the property and you are under a great deal of pressure to keep the occupancy above 96% and get the A/R way down.

Probably the most important reason to keep your landlord attorney informed of these things is so they cannot be used as distractions by the tenant when they come to court.  Now, attorneys are trained to let this information run off their backs and respond as though they knew it all along.  But, really knowing these things up front allows your attorney to prepare for the tenant’s efforts to sidetrack the mediators and the judges with irrelevant issues.  It allows your attorney to have answers to the obvious, inevitable questions that are legally unimportant but which the human court personnel will indulge if for no other reason than just out of curiosity.

And, perhaps the best side benefit of keeping your attorney informed is that they can help you spot potential problems that may arise before they get too costly to address.  Take the tenant who is abusing their right to visit your office.  Your lease provides you with some protection from this sort of behavior by your tenants and you can take a proactive position if the same or other tenants continue disturbing you.  Or, if your lease does not include such provision or the lease is inadequate in helping you manage the distractions, your attorney can help you explore your options for addressing the situation.  They won’t even know there is a problem unless you tell them.

Finally, sharing all of this information with your attorney has no downside risk.  Everything you discuss with your attorney is protected by law and cannot be revealed by your attorney without your permission.  You have heard of the concept of attorney-client privilege.  Well, this is attorney-client privilege in action.  You share the information with your attorney and, if you don’t want them to, they cannot share it with anyone else…period.  The idea is to allow you to discuss the beneficial (as well as detrimental) aspects of your situation with your attorney without fear that any of the information will get into the wrong hands.  If you so decide, your attorney must take the information you share with them to the grave.  If they don’t, they can lose their license to practice law.

So, as you can see, the privilege is yours.  Exercise it.  Share all the information you have so you can take better advantage of the professional you hired to assist you with your legal needs.    Then, helping you will be their privilege as well.   [TOP]

Evaluating your attorney's performance.

Our Not-So-Quick Tip from the December 2009 issue on effectively communicating with your attorney brought feedback from landlords regarding the challenges that they face with their attorney, particularly regarding the attorney’s performance.  These landlords saw the central importance of communication with their attorneys and subscribed to the seven (7) principles described last month, but they were not experiencing the business results that they wanted from their “legal matters.”  These landlords asked that we include an article in this month’s newsletter regarding how to evaluate their attorney’s performance. 

Landlords should first establish firmly in their mind the roles that attorney and client each play, and then evaluate the attorney’s communication-interaction with the landlord based on those roles.  In short, the attorney must be the attorney, and the landlord must be the client – neither can (or should) play both roles. 

The attorney should be the landlord’s trusted advisor - acting as a guide through the legal landscape in any given situation - and steadfast advocate, seeking to accomplish the landlord’s business goals and objectives.  The landlord’s role as client is to participate fully in the communication processes with the attorney to enable the attorney to provide informed advice and guidance and to execute the client’s decisions. 

Here are common issues that arise in the attorney-client relationship based on communication (or the lack thereof) between the attorney and the landlord, which often results from role-confusion: 

• The attorney does not ask you about the background to the issue(s) about which you are seeking advice.  This can expose you unnecessarily to other legal liability or expenses.  For example, if the attorney moves forward with an eviction case against a disabled tenant who had asked for an unresolved “reasonable accommodation” on the issue involved, you are now exposed to a fair housing or discrimination complaint by that tenant.

• The attorney does not ask you to define the goals or objectives (what you want to accomplish), and either acts on his/her own or tells you what to do.  This reverses the roles – the landlord is the business representative and decision-maker, while the attorney exists to evaluate the situation, present options, assist the landlord in making a decision, and carry out the landlord’s decision(s) in the legal arena.

• The attorney does not describe the options or strategies available to you.  This often reflects an attorney who is uncomfortable with handling difficult situations or matters that fall outside the “normal” case, and forces the client to accept a sub-optimal result.

• The attorney does not communicate with you about the status of the matter.  This undermines your ability to manage your business and tenant-relationships, and erodes (rather than enhances) both.

• The attorney acts beyond his/her authority without your permission.  The most egregious example of this behavior is when the attorney changes the terms of settlement with the tenant (after obtaining the court judgment that you wanted) without your informed consent or agreement.  This is terribly destructive for the landlord for many reasons, particularly because it implies to that tenant (and all the other tenants who hear about it) that the lawyer is in charge, and not the landlord.

Remember, as the landlord, you can only play the role of client – you cannot also be the lawyer.  If you follow the seven (7) principles of communication in last month’s newsletter, but are experiencing these issues, it is time to find a new lawyer.    [TOP]
 

DISCLAIMER:
The reading of this newsletter does not form an attorney-client relationship. The contents of this newsletter are for informational purposes only and do not constitute legal advice. Nothing in this newsletter is intended to imply or predict the outcome of any legal matter that you may be considering or be involved in. The Landlord Law Firm makes no warranties of any kind regarding the information contained in this newsletter.