As we explained previously, the pandemic relief bill that has been approved by both Houses of Congress, but still awaits the President’s signature, contains good and bad for our nation’s market-rate residential landlords. From the article:

  • It extends the CDC eviction moratorium through January 31, 2021 (and it is expected to be extended further from there under the Biden Administration).
  • Tenants can qualify for up to 15 months of federal rental assistance.
  • The criteria for qualification are not clear as of yet.
  • This assistance partly will cover months of unpaid back rent, rewarding landlords who have not evicted during the COVID-19 pandemic. A landlord cannot get back rent if the tenant has already left.
  • Rental assistance money will be distributed by states and cities.
  • Renters will apply for the help, and the money will be sent directly to their landlords. If a landlord doesn’t cooperate, the tenant can access the funds directly.
  • Renters looking for assistance can call 211 or go to the website www.211.org. It’s a confidential referral and information help line and web site.

So, the landscape will be changing soon very significantly in the relationship between landlord and tenant in the affordable housing sphere.

We will post more detail as it becomes available.

Contact Chris Finney (513.943.6655) if you have questions.

Entertain us, if you will, as we serve as Jacob Marley to landlords in visiting the ghosts of eviction moratoriums, past, present and future.

After months of experience with the eviction moratorium imposed by the Centers for Disease Control, we now know that most residential evictions — even those for non-payment of rent — can proceed per normal procedures, at least until new regulations are issued and the moratorium never applied to eviction for issues other than non-payment (e.g., criminal activity and damaging the premises,)

The past

As reported here, the Centers for Disease Control on Friday, September 4, 2020 imposed a residential eviction moratorium for non-payment of rent in certain limited circumstances through the end of the year due to the impact of COVID-19. That relief required the tenant to certify that 1) the individual has used best efforts to obtain government assistance for the payment of rent, 2) the individual falls below the above-income thresholds ($99,000 for individuals and $198,000 for those filing jointly), 3) the individual can’t pay rent due to loss of income or medical expenses, 4) the individual is using best efforts to pay the rent or as much of it as he can, and 5) eviction would render the individual homeless.

And as we report here, the CDC clarified that Order, allowing for more vigorous actions by landlords pursuing eviction: Cross examination of a tenant who claims he has met the criteria, allowing commencement and pursuit of an eviction action even if the set out is not until after the first of the year, and imposing criminal penalties upon tenants making false certifications.

The present

Our experience in recent evictions is that many tenants cannot stand up under cross examination as to the CDC certifications: They usually have paid no rent at all, which hardly ever complies with the CDC “best efforts” criteria, and it is unlikely the eviction will result in homelessness for the vast majority of tenants.

In Hamilton County, before conducting the forcible entry and detainer hearing, the Magistrate has a separate evidentiary hearing on whether the CDC criteria are met — including allowing a landlord to cross examine a tenant — and then, when the tenant fails to meet this burden, allows the eviction hearing to proceed. In all, the takes an extra  5-10 minutes to try an eviction case and we have not yet failed to exceed the CDC standards.

The future

Add to all of this the fact that an eviction commenced today won’t result in a set out until well into January. Thus, the moratorium no longer has any application to new evictions being filed.

Finally, we don’t know either how the Trump administration will address the regulations after their year-end expiration until his term ends on January 19th, or how the new Biden administration will address the issue thereafter. For both Presidents, the issues are difficult: Millions of tenants are facing severe financial hardship as a result of the COVID-19 crisis, but on the other hand, landlords have to pay bank loans, real estate taxes, building repairs, and for insurance. Many can’t meet their obligations if tenants are not paying their rent. Then, if they start en masse to default on mortgage loans, it could destabilizing banks as in 2007-08. These are not easy issues for anyone.

So, the next few weeks and months will determine a new course for landlord-tenant legal relationships. Stay tuned for more updates, and contact Chris Finney (513.943.6655) with any Ohio or Kentucky eviction issues you may have.

A Realtor recently posed this question to me:

How often are the agents getting sued when/if a client falls at someone’s house during a showing? To me it seems unlikely but recently in a CE course they tried to scare us.

My answer follows:

Liability generally is fault-based: Did you do something negligent to endanger a client? The standard is the normal “standard of care” a buyer expects from his Realtor. If the Realtor has that duty, fails to adhere to it, and someone is injured as a result, then liability may ensue.

  • Does a Realtor have a duty to-pre-inspect for hazards on and about a property? To turn on lights, to check for loose floor boards, to smooth edges of carpet that have curled? To make sure a buyer does not stick their hand in the electrical panel?

I never have heard of a scenario in which the Realtor was accused of negligence of this type, but I assure you if someone is seriously hurt, the Plaintiff’s attorney will sue everyone involved and attempt to say you “fell below the expected standard of care.”

So, prudence would call for everyone (Realtors, lawyers, appraisers, contractors, investors) to each have commercial general liability insurance against these types of risks. For Ohio real estate salesmen, this insurance would typically be maintained by his broker, and that coverage would extend to the agent. Each agent should not need to obtain his own coverage.

It is generally not expensive, but it is helpful to have.

Beyond that, there are certain special coverages that are advisable: Errors and omission insurance (sort of malpractice insurance for real estate brokers and agents), fiduciary coverage in case your employees steal from you or steal client funds (or property), and auto liability coverage, which is auto insurance for those engaged in commerce on your behalf (driving to and from appointments, getting signatures on contracts or delivering contracts, delivering keys, etc.).

For every business owner and individual, we recommend selecting a qualified insurance agent, and sit with him as the business is created, and as it grows over time, to discuss the amounts, deductibles, and types of insurance to maintain. Someday, you may be very happy that you did.

 

The COVID-19 pandemic crisis has spurred a second suspension of jury trials in Hamilton County, this one “until further notice.”

This applies to to both civil and criminal jury trials. As far as other proceedings (from conferences with the Judge to non-jury trials), it is “hit or miss” and each case and each Judge may have a different schedule. However, our experience is that things are proceeding, if slower than normal.

Read more on WLWT.Com here.

 

The Centers for Disease Control and Prevention on Friday clarified the nationwide eviction moratorium that it had issued on September 4, 2020, lasting through the end of the year. That clarification (“Frequently Asked Questions”) is linked here.

Some important points from the FAQ:

  • The Order does not prevent owners from commencing eviction proceedings so long as the actual eviction (which we interpret to mean the set out) does not take place until January. As we see it, this means that evictions can proceed to writ, but the set out must wait until January.
  • As set forth in this blog entry, the protection to a tenant under the eviction moratorium is trigged when the tenant signs a CDC form that certifies all of the following (every adult residing in the unit must sign the form for the moratorium to take effect).
    • The individual has used best efforts to obtain government assistance for the payment of rent.
    • The individual falls below the above-income thresholds.
    • The individual can’t pay rent due to loss of income or medical expenses.
    • The individual is using best efforts to pay the rent or as much of it as he can.
    • Eviction would render the individual homeless.
  • An owner may cross examine (or perhaps conduct discovery as the Court would allow) as to the truthfulness of those certifications. Previously, the rule was ambiguous on this point, leading to inconsistent application throughout the thousands of jurisdictions handling executions in the nation.
  • Landlord are not required to inform tenants of their rights under the CDC Order.
  • The clarification reiterates that (a) tenants still owe their rent and (b) tenants have a duty to make partial rent payments as they are able.
  • The clarification reiterates the criminal penalties for tenants making material misrepresentations on the CDC form.

Friday’s FAQ pronouncement tilts the effect of the moratorium in favor of landlords. Given that the set out in Ohio typically is six-to-eight weeks after the start of the process (the 3-day notice), the real delay in recovering possession of a landlord’s property from a non-paying tenant is now under 30 days.

The scope of the moratorium is limited to situations where the default is solely the non-payment of rent. Our firm has successfully worked with landlords who need to recover possession of their property from hold over tenants, squatters, those causing physical damage to property, those involving illegal use and sale of drugs, too many occupants and other lease violations.

Please call our experienced landlord/tenant litigators if you have questions. Contact Julie Gugino (513.943.5669) for more information.

 

As many in the Ohio real estate, title and finance industries are aware, this firm along with the firm of Markovits, Stock and Demarco are co-counsel to several Plaintiffs challenging a long-running real estate scam that has ensnared hundreds of victims in the greater Cincinnati marketplace.

The Complaint alleges causes of action under Civil RICO, Civil Conspiracy, Breach of Fiduciary Duty by both the various Build Realty companies, First Title and Pat Connors, Negligence against First Title and Pat Connors, Unjust Enrichment, and a declaration that the various schemes designed to avoid the statutory right of redemption and the right of a borrower to excess proceeds under a lending arrangement are illegal, and that the trusts themselves are illegal and contrary to public policy.

The defendants in the proposed Amended Complaint include:

  • Build Realty, Inc.
  • First Title Agency, Inc.
  • Edgar Construction, LLC
  • Cincy Construction, LLC
  • McGregor , First Title, LLC
  • Cowtown Holdings, LLC
  • Build SWO, LLC
  • Greenleaf Support Services, LLC
  • Gary Bailey as Trustee and individually
  • George Triantafilou, as trustee and individually
  • Robert Scott Whiteside
  • G2 Technologies, LLC
  • GT Financial, LLC
  • Five Mile Capital Partners, LLC
  • Smith Graham & Co., Investment Advisors, L.P.
  • Pat Connors

A copy of the proposed form of Amended Complaint is here and below.

It appears this case will soon be moving forward before Federal District Court Judge Cole.

We will endeavor to keep victims updated by means of this blog as developments occur.

If you have questions, it’s best to email Christopher P. Finney. You may also call him at 513-720-2996.

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Ohio’s largest hotel and convention center, Kalahari Park in Sandusky

In a second State Court win against the arbitrary and unconstitutional shut-down Orders of Dr. Amy Acton and Governor Mike DeWine, the 1851 Center for Constitutional Law (Maurice Thompson) and Finney Law Firm (Christopher Finney and Julie Gugino) today obtained a Preliminary Injunction for the re-opening of Kalahari Water Park and Convention Center in Sandusky, Ohio.

Read the Order here and below. More on this will follow.

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As is reported here by Jennifer Baker of Fox 19, today Finney Law Firm filed suit against Dr. Amy Action, former director of the Ohio Department of Health, to allow planned summer music festivals to proceed.

Read the story here.

David Nethers of Fox 8 in Cleveland also has the story here.

Read the Complaint here.

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