Overview of New Jersey Landlord/Tenant Law Bridge the Gap PREPARED FOR NYCLA CLE Institute 14 Vesey Street New York, NY 10007 PREPARED BY: EHRLICH PETRIELLO GUDIN & PLAZA, P.C. 60 PARK PLACE, SUITE 1016 NEWARK, NJ 07102-5504 TEL. 973-643-0040 FAX. 973-596-1781 WWW.EPGP-Law.com December 5, 2013
PLANNING AHEAD TO AVOID TENANCY PROBLEMS Planning ahead to avoid tenancy problems, and the ultimate need to engage in the eviction process begins long before one chooses to enter into a contract to lease a premises. Through the presentation of this program we intend to highlight critical issues faced by landlords and tenants engaged in the business and law of leasing in New Jersey. LEGAL REQUIREMENTS ~ PREMISE It is said that Landlord/Tenant law is Hyper Technical. That is because if there is any defect in form or procedure in a Plaintiff- Landlord s action for repossession of a rented premises, a Court must dismiss the action. It has been said, the failure of plaintiff to have scrupulously followed all notification procedures mandated by the Anti-Eviction Act requires that its complaints be dismissed. And, when dealing with tenants, landlords must turn square corners. Sacks Realty Co. v. Batch, 235 N.J.Super. 269, 561 A.2d 1216 N.J.Super.L.,1989. There are many filing and, lease language requirements, service of notice prerequisites, as well as other "dos" and "don ts" in connection with tenancy laws and procedure in New Jersey that are all usually critical to a case. 2
THE EVICTION ACTION "LANDLORD/TENANT" COURT The Landlord/Tenant court is a division of the Special Civil Part of the Superior Court of New Jersey. Each county in the State of New Jersey has a Landlord/Tenant Court that is empowered by statute to hear cases affecting tenancies within their county jurisdiction. The court's jurisdiction is limited to awarding "possession" of the premises to the landlord. That is, if a landlord is successful in bringing a case in the Landlord/Tenant Court, they will receive a "Judgment of Possession" which entitles them to evict the tenant from the demised (rented) premises. As a condition to commencing a case in the Landlord/Tenant Court, a landlord/tenant relationship must exist between the plaintiff (generally the landlord) and the defendant (generally the tenant.) If either party seeks any different form of relief, the tenancy judge has the power to transfer the case to a higher court which has more jurisdiction. Cases that are brought (or filed) in Landlord/Tenant Court are known as "summary dispossess" proceedings. They are so named after the New Jersey Court Rule that authorizes the commencement of the case. The Rule provides the defendant 3
shall "appear and state a defense" in lieu of providing a written answer, which is the usual way to respond to a plaintiff's Complaint. THE "PARTIES Generally, the landlord is the plaintiff and the tenant is the defendant. However, notwithstanding the foregoing, since judgments of possession may affect the rights of other persons occupying the rented premises, there has been a trend by certain judges, depending on what county you re in to have the landlord name all known adult occupants as defendants in the action for possession. The theory is that all those whose interests may be affected by an adverse judgment should be included in the action, so they are served with process and get notice. This would include all subtenants, undertenants, assignees, spouses, boyfriends/girlfriends, etc. COMMENCING THE CASE A summary dispossession action against a tenant is governed by one of the following statutes: - the Summary Dispossess Act (N.J.S.A. 2A:18-53) or - the Anti-Eviction Act (N.J.S.A. 2A:18-61.1) In my experience, the Anti-Eviction Act applies to well over 95% of the cases that are brought in tenancy court each day. The Anti-Eviction Act applies to (i) residential properties if the owner (landlord) does not live there or (ii) if the owner does live there and there are more than two other rental units. The Summary Dispossess Act applies to all other rental or residential properties including commercial tenancies. I have provided a copy of each of these acts on the following pages. 4
A tenant falling within the purview of the Anti-Eviction Act is said to have a "protected" tenancy. A landlord cannot terminate this type of tenancy without cause, i.e. one of the grounds provided for by the statute. Theoretically, a tenant can remain in the demised (rented) premises for as long as they want, so long as there is no violation of any provision in the Act. Hence, they are "protected" from the whims of a landlord. 2A:18-61.1. Removal of residential tenants; grounds No lessee or tenant or the assigns, under-tenants or legal representatives of such lessee or tenant may be removed by the Superior Court from any house, building, mobile home or land in a mobile home park or tenement leased for residential purposes, other than (1) owner-occupied premises with not more than two rental units or a hotel, motel or other guest house or part thereof rented to a transient guest or seasonal tenant; (2) a dwelling unit which is held in trust on behalf of a member of the immediate family of the person or persons establishing the trust, provided that the member of the immediate family on whose behalf the trust is established permanently occupies the unit; and (3) a dwelling unit which is permanently occupied by a member of the immediate family of the owner of that unit, provided, however, that exception (2) or (3) shall apply only in cases in which the member of the immediate family has a developmental disability, except upon establishment of one of the following grounds as good cause: a. The person fails to pay rent due and owing under the lease whether the same be oral or written. b. The person has continued to be, after written notice to cease, so disorderly as to destroy the peace and quiet of the occupants or other tenants living in said house or neighborhood. c. The person has willfully or by reason of gross negligence caused or allowed destruction, damage or injury to the premises. d. The person has continued, after written notice to cease, to substantially violate or breach any of the landlord's rules and regulations governing said premises, provided such rules and regulations are reasonable and have been accepted in writing by the tenant or made a part of the lease at the beginning of the lease term. e. (1) The person has continued, after written notice to cease, to substantially violate or breach any of the covenants or agreements contained in the lease for the premises where a right of reentry is reserved to the landlord in the lease for a violation of such covenant or agreement, provided that such covenant or agreement is reasonable and was contained in the lease at the beginning of the lease term. (2) In public housing under the control of a public housing authority or redevelopment agency, the person has substantially violated or breached any of the covenants or agreements contained in the lease for the premises pertaining to illegal uses of controlled dangerous substances, or other illegal activities, whether or not a right of reentry is reserved to the landlord in the lease for a violation of such covenant or agreement, provided that such covenant or agreement conforms to federal 5
guidelines regarding such lease provisions and was contained in the lease at the beginning of the lease term. f. The person has failed to pay rent after a valid notice to quit and notice of increase of said rent, provided the increase in rent is not unconscionable and complies with any and all other laws or municipal ordinances governing rent increases. g. The landlord or owner: (1) seeks to permanently board up or demolish the premises because he has been cited by local or State housing inspectors for substantial violations affecting the health and safety of tenants and it is economically unfeasible for the owner to eliminate the violations; (2) seeks to comply with local or State housing inspectors who have cited him for substantial violations affecting the health and safety of tenants and it is unfeasible to so comply without removing the tenant; simultaneously with service of notice of eviction pursuant to this clause, the landlord shall notify the Department of Community Affairs of the intention to institute proceedings and shall provide the department with such other information as it may require pursuant to rules and regulations. The department shall inform all parties and the court of its view with respect to the feasibility of compliance without removal of the tenant and may in its discretion appear and present evidence; (3) seeks to correct an illegal occupancy because he has been cited by local or State housing inspectors or zoning officers and it is unfeasible to correct such illegal occupancy without removing the tenant; or (4) is a governmental agency which seeks to permanently retire the premises from the rental market pursuant to a redevelopment or land clearance plan in a blighted area. In those cases where the tenant is being removed for any reason specified in this subsection, no warrant for possession shall be issued until P.L.1967, c. 79 (C.52:31B-1 et seq.) and P.L.1971, c. 362 (C.20:4-1 et seq.) have been complied with. h. The owner seeks to retire permanently the residential building or the mobile home park from residential use or use as a mobile home park, provided this subsection shall not apply to circumstances covered under subsection g. of this section. i. The landlord or owner proposes, at the termination of a lease, reasonable changes of substance in the terms and conditions of the lease, including specifically any change in the term thereof, which the tenant, after written notice, refuses to accept; provided that in cases where a tenant has received a notice of termination pursuant to subsection g. of section 3 of P.L.1974, c. 49 (C.2A:18-61.2), or has a protected tenancy status pursuant to section 9 of the "Senior Citizens and Disabled Protected Tenancy Act," P.L.1981, c. 226 (C.2A:18-61.30), or pursuant to the "Tenant Protection Act of 1992," P.L.1991, c. 509 (C.2A:18-61.40 et al.), the landlord or owner shall have the burden of proving that any change in the terms and conditions of the lease, rental or regulations both is reasonable and does not substantially reduce the rights and privileges to which the tenant was entitled prior to the conversion. j. The person, after written notice to cease, has habitually and without legal justification failed to pay rent which is due and owing. k. The landlord or owner of the building or mobile home park is converting from the rental market to a condominium, cooperative or fee simple ownership of two or more dwelling units or park sites, except as hereinafter provided in subsection l. of this section. Where the tenant is being removed 6
pursuant to this subsection, no warrant for possession shall be issued until this act has been complied with. No action for possession shall be brought pursuant to this subsection against a senior citizen tenant or disabled tenant with protected tenancy status pursuant to the "Senior Citizens and Disabled Protected Tenancy Act," P.L.1981, c. 226 (C.2A:18-61.22 et al.), or against a qualified tenant under the "Tenant Protection Act of 1992," P.L.1991, c. 509 (C.2A:18-61.40 et al.), as long as the agency has not terminated the protected tenancy status or the protected tenancy period has not expired. l. (1) The owner of a building or mobile home park, which is constructed as or being converted to a condominium, cooperative or fee simple ownership, seeks to evict a tenant or sublessee whose initial tenancy began after the master deed, agreement establishing the cooperative or subdivision plat was recorded, because the owner has contracted to sell the unit to a buyer who seeks to personally occupy it and the contract for sale calls for the unit to be vacant at the time of closing. However, no action shall be brought against a tenant under paragraph (1) of this subsection unless the tenant was given a statement in accordance with section 6 of P.L.1975, c. 311 (C.2A:18-61.9); (2) The owner of three or less condominium or cooperative units seeks to evict a tenant whose initial tenancy began by rental from an owner of three or less units after the master deed or agreement establishing the cooperative was recorded, because the owner seeks to personally occupy the unit, or has contracted to sell the unit to a buyer who seeks to personally occupy it and the contract for sale calls for the unit to be vacant at the time of closing; (3) The owner of a building of three residential units or less seeks to personally occupy a unit, or has contracted to sell the residential unit to a buyer who wishes to personally occupy it and the contract for sale calls for the unit to be vacant at the time of closing. m. The landlord or owner conditioned the tenancy upon and in consideration for the tenant's employment by the landlord or owner as superintendent, janitor or in some other capacity and such employment is being terminated. n. The person has been convicted of or pleaded guilty to, or if a juvenile, has been adjudicated delinquent on the basis of an act which if committed by an adult would constitute an offense under the "Comprehensive Drug Reform Act of 1987," N.J.S.2C:35-1 et al. involving the use, possession, manufacture, dispensing or distribution of a controlled dangerous substance, controlled dangerous substance analog or drug paraphernalia within the meaning of that act within or upon the leased premises or the building or complex of buildings and land appurtenant thereto, or the mobile home park, in which those premises are located, and has not in connection with his sentence for that offense either (1) successfully completed or (2) been admitted to and continued upon probation while completing, a drug rehabilitation program pursuant to N.J.S.2C:35-14; or, being the tenant or lessee of such leased premises, knowingly harbors or harbored therein a person who has been so convicted or has so pleaded, or otherwise permits or permitted such a person to occupy those premises for residential purposes, whether continuously or intermittently, except that this subsection shall not apply to a person harboring or permitting a juvenile to occupy the premises if the juvenile has been adjudicated delinquent upon the basis of an act which if committed by an adult would constitute the offense of use or possession under the said act. No action for removal may be brought pursuant to this subsection more than two years after the date of the adjudication or conviction or more than two years after the person's release from incarceration whichever is the later. o. The person has been convicted of or pleaded guilty to, or if a juvenile, has been adjudicated delinquent on the basis of an act which if committed by an adult would constitute an offense under 7
N.J.S.2C:12-1 or N.J.S.2C:12-3 involving assault, or terroristic threats against the landlord, a member of the landlord's family or an employee of the landlord; or, being the tenant or lessee of such leased premises, knowingly harbors or harbored therein a person who has been so convicted or has so pleaded, or otherwise permits or permitted such a person to occupy those premises for residential purposes, whether continuously or intermittently. No action for removal may be brought pursuant to this subsection more than two years after the adjudication or conviction or more than two years after the person's release from incarceration whichever is the later. p. The person has been found, by a preponderance of the evidence, liable in a civil action for removal commenced under this act for an offense under N.J.S.2C:20-1 et al. involving theft of property located on the leased premises from the landlord, the leased premises or other tenants residing in the leased premises, or N.J.S.2C:12-1 or N.J.S.2C:12-3 involving assault or terroristic threats against the landlord, a member of the landlord's family or an employee of the landlord, or under the "Comprehensive Drug Reform Act of 1987," N.J.S.2C:35-1 et al., involving the use, possession, manufacture, dispensing or distribution of a controlled dangerous substance, controlled dangerous substance analog or drug paraphernalia within the meaning of that act within or upon the leased premises or the building or complex of buildings and land appurtenant thereto, or the mobile home park, in which those premises are located, and has not in connection with his sentence for that offense either (1) successfully completed or (2) been admitted to and continued upon probation while completing a drug rehabilitation program pursuant to N.J.S.2C:35-14; or, being the tenant or lessee of such leased premises, knowingly harbors or harbored therein a person who committed such an offense, or otherwise permits or permitted such a person to occupy those premises for residential purposes, whether continuously or intermittently, except that this subsection shall not apply to a person who harbors or permits a juvenile to occupy the premises if the juvenile has been adjudicated delinquent upon the basis of an act which if committed by an adult would constitute the offense of use or possession under the said "Comprehensive Drug Reform Act of 1987." q. The person has been convicted of or pleaded guilty to, or if a juvenile, has been adjudicated delinquent on the basis of an act which if committed by an adult would constitute an offense under N.J.S.2C:20-1 et al. involving theft of property from the landlord, the leased premises or other tenants residing in the same building of complex; or being the tenant or lessee of such leased premises, knowingly harbors therein a person who has been so convicted or has so pleaded, or otherwise permits such a person to occupy those premises for residential purposes, whether continuously or intermittently. GROUNDS FOR EVICTION When a landlord is seeking to terminate a tenancy, it is important to select the proper statutory grounds. Under no circumstances may a tenant be legally "evicted" without meeting a statutory prerequisite. Note that the statute may require that one or more notices be served upon the tenant prior to proceeding with court action. With the exception of a tenant's non-payment of rent, or failure to pay rent after a reasonable increase (which requires a separate notice unto itself), a landlord is required to serve 8
notice upon a tenant prior to the institution of court action. N.J.S.A. 2A:18-61.2 provides the notice requirements. The concept of notice upon default is usually a term that commands significant attention in a commercial lease negotiation. If I am negotiating on behalf of a tenant I want the most liberal notice with opportunity to cure provision I can get. As landlords we must always be certain to refer to the lease agreement before commencing an action for possession to be sure we have complied with any notice conditions precedent for our failure to strictly adhere will result in a dismissal of our case and our delay in repossession. 2A:18-61.2. Removal of residential tenants; required notice; contents; service No judgment of possession shall be entered for any premises covered by section 2 of this act, (2A:18-61.1) except in the nonpayment of rent under subsection a. or f. of section 2, unless the landlord has made written demand and given written notice for delivery of possession of the premises. The following notice shall be required: a. For an action alleging disorderly conduct under subsection b. of section 2, or injury to the premises under subsection c. of section 2, or any grounds under subsection m., n., o. or p. of section 2, three days' notice prior to the institution of the action for possession; b. For an action alleging continued violation of rules and regulations under subsection d. of section 2, or substantial breach of covenant under subsection e. of section 2, or habitual failure to pay rent, one month's notice prior to the institution of the action for possession; c. For an action alleging any grounds under subsection g. of section 2, three months' notice prior to the institution of the action; d. For an action alleging permanent retirement under subsection h. of section 2, 18 months' notice prior to the institution of the action and, provided that, where there is a lease in effect, no action may be instituted until the lease expires; e. For an action alleging refusal of acceptance of reasonable lease changes under subsection i. of section 2, one month's notice prior to institution of action; f. For an action alleging any grounds under subsection l. of section 2, two months' notice prior to the institution of the action and, provided that where there is a written lease in effect no action shall be instituted until the lease expires; g. For an action alleging any grounds under subsection k. of section 2, three years' notice prior to 9
the institution of action, and provided that where there is a written lease in effect, no action shall be instituted until the lease expires. h. In public housing under the control of a public housing authority or redevelopment agency, for an action alleging substantial breach of contract under paragraph (2) of subsection e. of section 2, the period of notice required prior to the institution of an action for possession shall be in accordance with federal regulations pertaining to public housing leases. The notice in each of the foregoing instances shall specify in detail the cause of the termination of the tenancy and shall be served either personally upon the tenant or lessee or such person in possession by giving him a copy thereof, or by leaving a copy thereof at his usual place of abode with some member of his family above the age of 14 years, or by certified mail; if the certified letter is not claimed, notice shall be sent by regular mail. Case law provides that notices served upon a tenant, if not hand delivered, may be done by simultaneously mailing the notice by certified mail and regular mail. It is always a good practice to serve all notices by hand delivery and certified & regular mail. If a Notice becomes an exhibit or evidence at a trial, it will be critical to prove how it was served or delivered. The latest court mandated forms are found on the NJ Judiciary web site at: http://www.judiciary.state.nj.us/forms.htm 10
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AT TRIAL THE RETURN DATE After the court has served a copy of the Summons and Complaint upon the tenant, a court date (return date/ trial date) is scheduled. The landlord is generally notified of the date by post card. The tenant is notified on the Summons of the return date. On the return date, the court conducts a "calendar call" to determine which parties are present and prepared to proceed with a trial. If the landlord fails to appear, the case is dismissed "without prejudice," which means it can be re-filed without penalty. If the landlord appears and the tenant fails to appear, the court will enter a "default" against the tenant.* Thereafter a "judgment of possession" can be entered upon submission (within 30 days) of certain documents. As of November 1, 2001 NEW COURT RULES went into effect unifying the practice of obtaining judgments of possession throughout the state. *The exceptions to the automatic default rule are (1) if the tenant is an infant or incompetent person, or (2) the landlord acquired title to the premises from the tenant or gave the tenant an option to purchase. In these events, proof must be given in open court by the landlord in order to obtain a judgment of possession. 15
APPENDIX XI-T CERTIFICATION BY LANDLORD YOU MUST COMPLETE THIS PART: NAME OF LANDLORD OR ATTORNEY: ADDRESS & PHONE: Plaintiff : SUPERIOR COURT OF NEW JERSEY : LAW DIV., SPECIAL CIVIL PART vs. : COUNTY : LANDLORD-TENANT DIVISION Defendant : DOCKET #LT- YOU SHOULD COMPLETE PART A, PART B, OR BOTH, IF BOTH APPLY. CROSS OUT ANY PARAGRAPHS THAT DO NOT APPLY. PART C APPLIES TO ALL CERTIFICATIONS: A. [WHEN THE EVICTION IS BASED ON UNPAID RENT] 1. The tenant has failed to pay rent now due and owing in the amount of $ That amount consists of basic rent of $ late charges of $ legal fees relating to this action for eviction of $ filing fees and costs $ and other (specify) 2. All of the items listed above are included in the lease agreement as rent. 3. All of those items are permitted by applicable federal, state and local laws (including rent control or rent leveling, if applicable) to be included in the rent for the purposes of this action. B. [WHEN THE EVICTION IS BASED ON OTHER GROUNDS] 1. Eviction is sought because 2. I have attached a copy of all notices that have been served on the defendant. 3. The notices were served on the tenant(check one or more) by ordinary mail, by certified mail, personally, on the day of. 4. All of the facts stated in the notices are true. C. IN ALL CASES: 1. I have complied with the registration requirements of NJSA 46:8-27 et seq. 2. The tenant did not transfer ownership to me and I have not given the tenant an option to buy the property. 3. The tenant is not in the military service of the United States nor any of its allies, nor is the premises used for dwelling purposes of the spouse, a child or other dependent of a person in the military service of the United States. I, THE LANDLORD, CERTIFY THAT THE FOREGOING STATEMENTS MADE BY ME ARE TRUE. I AM AWARE THAT IF ANY OF THE FOREGOING STATEMENTS MADE BY ME ARE WILFULLY FALSE, I AM SUBJECT TO PUNISHMENT. LANDLORD DATE: [Note: Appendix XI-T adopted July 18, 2001 to be effective November 1, 2001.1] 16
APPENDIX XI-U CERTIFICATION BY LANDLORD'S ATTORNEY NAME OF ATTORNEY: ADDRESS & PHONE: Plaintiff : SUPERIOR COURT OF NEW JERSEY : LAW DIV., SPECIAL CIVIL PART : : COUNTY vs. : LANDLORD-TENANT DIVISION : : Certification by : Landlord s Attorney Defendant : DOCKET #LT- : 1. I am the attorney for the landlord in this matter and make this certification pursuant to rule 6:6-3(b) or Rule 6:64. 2. The landlord has asserted that the tenant has failed to pay rent now due and owing in this matter. 3. I have reviewed the applicable federal, state and local law and the written lease between the parties, and in my opinion the charges and fees sought, other than the base rent, are permitted to be included in the rent for purposes of this action. I certify that the foregoing statements made by me are true. I am aware that if any of the foregoing statements made by me are willfully false, I am subject to punishment. Date: [Note: Appendix XI-U adopted July 18, 2001 to be effective November 1, 2001.1 Signature & Printed name 17
APPENDIX XI-V CONSENT TO ENTER JUDGMENT (TENANT REMAINS) Plaintiff : SUPERIOR COURT OF NEW JERSEY : LAW DIV., SPECIAL CIVIL PART : : COUNTY vs. : LANDLORD-TENANT DIVISION : : Consent to Enter Judgment : Tenant to Stay in Possession Defendant : DOCKET #LT- THE TENANT AND LANDLORD HEREBY AGREE THAT: 1. The Tenant shall pay to the Landlord $ which the Tenant admits is now due and owing and AGREES TO THE IMMEDIATE ENTRY OF A JUDGMENT FOR POSSESSION. 2. The Tenant shall pay the amount shown in paragraph 1 as follows: a. $ immediately, which the Landlord admits receiving. b. The Tenant shall pay the rest of the amount shown in paragraph 1 as follows: 3. The Tenant also agrees to pay $ each month as required by the rental agreement, in addition to the payment required in paragraph 1,until this settlement agreement is over. 4. All payments made during the term of this agreement shall be applied first to the rents that become due after today, and then they shall be applied to pay the balance of the arrears stated in paragraph 1. If the Tenant makes all payments required in paragraph 2b of this agreement, the Landlord agrees not to request a warrant of removal. If the Tenant does not make all payments required in paragraph 2b of this agreement, the Tenant agrees that the Landlord, with notice to the tenant, may file a certification stating when and what the breach was and that a warrant of removal may then be issued by the clerk. THIS MEANS THAT IF THE TENANT FAILS TO MAKE ANY PAYMENT THAT IS REQUIRED IN PARAGRAPH 2b OF THIS AGREEMENT, THE TENANT MAY BE EVICTED AS PERMITTED BY LAW AFTER THE SERVICE OF THE WARRANT OF REMOVAL. 5. This agreement shall end when the Tenant has paid the full amount of rent stated in paragraph 1 and then the judgment shall be vacated and the complaint shall be dismissed. DATE: Landlord's Attorney Tenant's Attorney Landlord Tenant NOTE: THE CERTIFICATION BY LANDLORD AND THE CERTIFICATION OF LANDLORD'S ATTORNEY (IF THE LANDLORD HAS AN ATTORNEY) ARE ATTACHED HERETO. [Note: Appendix XI-V adopted July 18, 2001 to be effective November 1, 2001.] 18
APPENDIX XI-W CONSENT TO ENTER JUDGMENT FOR POSSESSION (TENANT VACATES) Plaintiff : SUPERIOR COURT OF NEW JERSEY : LAW DIV., SPECIAL CIVIL PART : : COUNTY vs. : LANDLORD-TENANT DIVISION : : Consent to Enter Judgment : Tenant Required to Vacate Defendant : DOCKET #LT- THE TENANT AND LANDLORD HEREBY AGREE THAT: 1. The Tenant AGREES TO THE IMMEDIATE ENTRY OF A JUDGMENT FOR POSSESSION. 2. Check one of the following: A. The Tenant shall pay no money, or B. The Tenant shall pay $, as follows: 3. A. If the Tenant does not make all payments required in paragraph 2 of this Agreement, the Tenant agrees that the Landlord, with notice to the tenant, can file a certification stating when and what the breach was and that a warrant of removal will then be issued by the clerk. B. EVEN IF THE TENANT DOES MAKE ALL PAYMENTS REQUIRED IN PARAGRAPH 2, THE TENANT STILL AGREES TO MOVE NO LATER THAN. IF THE TENANT DOES NOT MOVE BY THAT DATE, LANDLORD CAN HAVE THE TENANT EVICTED AS PERMITTED BY LAW. DATE: Landlord's Attorney Tenant's Attorney Landlord Tenant NOTE: THE CERTIFICATION BY LANDLORD AND THE CERTIFICATION OF LANDLORD'S ATTORNEY (IF THE LANDLORD HAS AN ATTORNEY) ARE ATTACHED HERETO. (Note: Appendix XI-W adopted July 18, 2001 to be effective November 1, 2001.] 19
SETTLING YOUR CASE IN COURT The courts look favorably upon settlements between parties. Whether it is between pro se litigants or attorneys, the court encourages settlement. Practices in the various counties of the state have shown that judges handle the filing and review of settlement agreements in a variety of manners. If you are unfamiliar with a particular court's practice, check with the judge's law clerk assigned to hear the case to ensure proper compliance with the filing requirements of a settlement agreement. Some counties require the parties to meet with a mediator if they cannot settle the issues between themselves. It used to be common practice that parties would settle their case before they went to court, since there was no requirement that the parties appear in court if they agreed on the terms of a settlement. Unless the parties have settled and agreed to dismiss the case prior to the trial date, it is best to appear in court to properly "process" the settlement since court rules require the courts to review agreements. In any event it is best to reduce any agreement to writing. It is important be cognizant of the steps one must follow if a tenant breaches an agreement when applying for a warrant. 20
THE CONTESTED CASE On the return date, if the landlord and tenant appear and cannot settle the issues (and have participated in mediation if required), the case will be heard by the court without a jury. The individuals that will provide testimony (evidence) to the court will be sworn or will have to affirm under the penalty of perjury, to tell the truth. The plaintiff begins and will have the burden of proving, by a preponderance of the credible evidence, each allegation contained in the complaint. Even though the Landlord/Tenant court is technically a division of the Superior Court, the Rules of procedure and evidence are relaxed, BUT NOT SUSPENDED! As a plaintiff/landlord, it is a boon to your case to BE PREPARED! When your case is presented to the court, you must be able to clearly articulate your proofs. If the parties are appearing pro se, most judges will begin questioning the parties to narrow the issues. As an attorney representing the landlord of the hypothetical ABC Park Apts., an examination of the witness may typically proceed as follows: Q. What is your relationship to ABC Park Apts.? Q. Where is ABC Park Apts. located? Q. Is the defendant a tenant at ABC Park Apts.? Q. What apartment does the defendant reside in? Q. Is that pursuant to a written lease agreement? Q. Did the tenant violate the agreement? Q. How did the tenant violate the agreement? If, for instance, the tenant failed to pay rent, the questions would continue: Q. What is the total rent due and owing? 21
Q. How did you arrive at that amount? Q. Is the property properly registered? Q. Is the tenant still in possession of the premises? Q. Are you seeking a judgment of possession? If the landlord is seeking to terminate the tenancy for cause other than non-payment, the questions may be modified as follows: Q. Has the tenant violated the lease? Q. What paragraph? Q. What did the tenant do that violated that provision? Q. Was a Notice to cease served upon the tenant? How? When? Q. Did the tenant cease the acts complained of? Q. Was a Notice to Quit served upon the tenant? How? When? The witness should always be able to identify all documents referred to in their testimony. After identification, each should be marked into evidence so the judge can refer to them. If you are a pro se litigant, simply provide the court with the answers to the foregoing questions. You will appear highly credible, make the court's job easier, and gain favor with the judge while on the way towards winning your case. If you attempt to introduce extraneous matters, you will lose credibility and hurt your case. For instance, if it is a non-payment of rent action, DO NOT begin telling the court about how the tenant has been disorderly, drug dealing, or committing "terroristic threats" against the landlord. Even though these are all valid grounds to evict under the Anti-Eviction Act, they are irrelevant in a non-payment of rent case. 22
COMMON DEFENSES TO EVICTION (1) HABITABILITY All leases of residential real property include an implied warranty of habitability. The seminal New Jersey Supreme Court decision is Marini v. Ireland, 56 N.J. 130 (1970) which involved the right to repair and deduct. In Marini, a tenant's toilet broke. Two days later she called a plumber who repaired the toilet. She then deducted from her rent the cost of the repair. The landlord subsequently sought to evict her for non-payment of rent. The court dismissed the Complaint and expanded the implied warranty of habitability by allowing the tenant the right to make repairs and deduct the cost from tenant's rent. Portions of the case read as follows: In a modern setting, the landlord should in a residential letting be held to an implied covenant against latent defects which is another manner of saying habitability and livability fitness. Actually it is a covenant that at the inception of the lease, there are no latent defects in facilities vital to the use of the premises for residential purposes because of faulty original construction or deterioration from age or normal usage. And further it is a covenant that these facilities will remain in usable condition during the entire term of the lease. In performance of this covenant the landlord is required to maintain those facilities in a condition which renders the property livable. In limiting the scope of the warranty, the court stated, "The nature of vital facilities and the extent and type of maintenance and repair required is limited and governed by the type of property rented and the amount of rent reserved." The tenant's right to repair and deduct was stated clearly: 23
If, therefore, after appropriate notice a landlord fails to make the repairs and replacements of vital facilities necessary to maintain the premises in a livable condition for a period of time adequate to accomplish such repair and replacements, the tenant may cause the same to be done and deduct the cost thereof from future rents. The tenant's recourse to such self-help must be preceded by timely and adequate notice to the landlord of the faulty condition in order to accord him the opportunity to make the necessary replacement or repair. If the tenant is unable to give such notice after a reasonable attempt, he may nonetheless proceed to repair or replace. If, on the return date of a non-payment of rent case, a tenant raises a "Marini" defense and has not effectuated the repairs, they must be prepared to deposit with the court all of the base rent which is due. The court will not require the tenant to pay late charges, legal charges, or the like if the court agrees to entertain the tenant's position. If the tenant is unable to "post" the base rent that is due, the court will generally not allow a Marini defense to proceed. If the tenant is prepared to post the rent, various things can happen. Generally, the court strives to have litigants resolve their differences between themselves. Towards that end, the court may direct the tenant to provide the landlord with a written list of items which the tenant claims is in need of repair. The tenant will then be required to deposit the rent that is due with the clerk of the court pending the repairs. If the repairs are made to the satisfaction of the tenant, (i) it can be agreed between the parties that the money on deposit be released to the landlord; or (ii) the tenant may request a Marini hearing to try to obtain an abatement in their rent for the period of time they claim the unit was uninhabitable. An abatement may be granted based upon a judge's appraisal of the diminution in the value of the use of the premises for the period the defect existed. 24
The tenant's Marini defense must directly affect the habitability of the premises. Potholes in the driveway or peeling paint on the outside of a house would not likely qualify. Failure to provide heat, hot water, plumbing or sewerage disposal renders the premises unsuitable for human habitation and clearly meets the Marini criteria. Some factors to be considered in determining whether defects affect habitability of premises (and thus can be considered in determining amount of rent abatement) are whether the condition violates applicable housing code or sanitary regulations, whether the condition affects vital facility, the effect of the condition on safety and sanitation, the duration of the condition, the age of the structure, the amount of rent, and whether the tenant waived the right to object to the condition or was responsible for the condition. C.F. Seabrook Co. v. Beck, 174 N.J. Super. 577, 417 A. 2d 89 (A.D. 1980). In Chess v. Muhammad, 179 N.J. Super. 75, 430 A. 2d 928 (A.D. 1981) the court held that tenants were not entitled to an abatement in a summary dispossess action for failure by the tenant to pay rent when the landlord repaired a defective condition within a reasonable time after learning of its existence. In another case on point, a court said the failure by a landlord in a multistoried building to supply heat, hot water, garbage disposal, or elevator service was a breach of implied covenant of habitability and could be considered in diminution of rent; but the malfunction of Venetian blinds, water leaks, wall cracks and lack of painting were primarily amenities and would not be considered in diminution of rent. Academy Spires, Inc. v. Brown, 111 N.J. Super. 477, 268 A. 2d 556 (1970). (2) RETALIATION OR REPRISAL New Jersey Statute 2A:42-10.10 provides that no landlord of residential premises, except owner occupied with not more than 2 rental units, shall serve a notice 25
to quit upon any tenant or institute any action against a tenant to recover possession of premises: a. As a reprisal for the tenant's efforts to secure or enforce any rights under the lease or contract, or under the laws of the State of New Jersey or its governmental subdivisions, or of the United States; or b. As a reprisal for the tenant's good faith complaint to a governmental authority of the landlord's alleged violation of any health or safety law, regulation, code or ordinance, or State law or regulation which has as its objective the regulation of premises used for dwelling purposes; or c. As a reprisal for the tenant's being an organizer of, a member of, or involve din any activities of, any lawful organization; or d. On account of the tenant's failure or refusal to comply with the terms of the tenancy as altered by the landlord, if the landlord shall have altered substantially the terms of the tenancy as a reprisal for any actions of the tenant set forth in subsection a, b and C. Substantial alteration shall include the refusal to renew a lease or to continue a tenancy of the tenant without cause. Under subsection b of this section the tenant shall originally bring his good faith complaint to the attention of the landlord or his agent and give the landlord a reasonable time to correct the violation before complaining to a governmental authority. A landlord shall be subject to a civil action by the tenant for damages and other appropriate relief, including injunctive and other equitable remedies, as may be determined by a court of competent jurisdiction in every case in which the landlord has violated this statute. (3) WAIVER The issue of wavier most commonly arises when tenants (i) have pets in violation of a lease or, (ii) pay rent habitually late in violation of a lease. The rule is that where a landlord has knowledge of a cause for forfeiture (eviction) and he continues to recognize the tenant and the existence of the lease, he waives the forfeiture. 26
In simple terms, if you have a right to evict a tenant on one of the statutory grounds for a summary dispossess action, and you delay exercising that right, it may be waived. Waiver is a question of fact, not law, for a court to determine. There are a number of court decisions on this issue. The clearest example of a landlord waiving its right to evict would be the acceptance of rent from a tenant after a court has entered a judgment of possession without first entering into a written consent judgment. If a landlord serves a Notice to Quit upon a tenant (which as you know should contain a demand for possession) and then accepts rent after the service of the notice, the landlord has waived its right to proceed against the tenant based on that notice. Burstein v. Liberty Bell Village, Inc., 120 N.J. Super. 54, 293 A.2d 283 (1972) I have seen landlords do this unknowingly. Tenants do not generally know the landlord is precluded from accepting the rent. Despite receiving a valid Notice to Quit, tenants may attempt to pay their rent in the usual manner. Whenever a Notice to Quit is served upon a tenant, a landlord should not accept rent. But all is not always lost, if the landlord receives and processes such a rent payment. If a landlord has served a Notice to Quit, and the tenant delivers payment to a landlord's representative, mails in the rent, or drops it into a lockbox of the landlord's designed for that purpose, the payment should be returned immediately. If the payment was negotiated (cashed), a landlord can mail one of its own checks back to the tenant with a brief explanatory letter. Otherwise, depending on the statutory section the tenant violated, a landlord may be able to serve a new Notice to Quit. A leading New Jersey case on waiver provided that where the sale of bus tickets had been engaged in by tenant for a long time to landlord s knowledge and during that time regular rent had been tendered and accepted, the landlord waived alleged 27
breaches of use covenant resulting from sale of tickets; equity and good conscience would require reasonable notice from the landlord to the tenant to discontinue the practice and from thenceforth to abide by use limitations of the lease and, unless such notice was served and bus tickets sold thereafter, equity should bar forfeiture of the lease on basis of the sale of tickets. Carteret Properties v. Variety Donuts, Inc., 49 N.J. 116, 228 A. 2d 674 (1967). (4) UNCONSCIONABILITY A tenant may raise the defense of unconscionability when a landlord seeks to impose new terms upon the tenant that did not previously exist. This is generally seen in the context of a rent increase that the tenant feels is unreasonable. In New Jersey, a number of municipalities have rent control ordinances, limiting the percentage a landlord may increase a tenant's rent. As another example, I argued and won a case in the Appellate Division of the Superior Court for a landlord who discontinued the use of a central "air conditioning" type system in a 50 unit apartment building. Some tenants refused to sign a renewal lease that did not obligate the landlord to provide this service. The tenants contended that an unconscionable lease change had been foisted upon them. The landlord contended that the change was out of necessity (the old system was damaging the building from leaky pipes in the walls), and the tenants were free to install their own air conditioners. The Appellate Division found that the lease was reasonable even though it did not obligate the landlord to provide a service as it had previously. 28
(5) BANKRUPTCY The filing of a petition in bankruptcy (Federal Court) stays any case in State Court, against the filing party. If a landlord seeks to pursue a tenant during the pendency of a tenant's bankruptcy proceedings, they must apply to the Bankruptcy court for permission to pursue the tenant in bankruptcy court, or ask the Bankruptcy court for permission to pursue the eviction action in State Court. Briefly, in bankruptcy, a lease must either be assumed or rejected. If it is assumed by the tenant, the landlord will be paid all rent that is due. If it is rejected by the tenant, the landlord has a right to take possession. In either event, if a tenant ceases paying rent, a landlord should move expeditiously after a bankruptcy filing by a tenant to vacate the Automatic Stay so that possession of the premises may be recovered. Section 311 of the Bankruptcy Reform Act of 2005 amends Code sec. 362(b) to provide that certain new exceptions from the automatic stay are established for landlords seeking to evict tenants. The first exception to the stay, Code sec. 362 (b)(22) allows the continuance of any eviction proceeding involving the debtor s residential property in which the landlord obtained a judgment of possession prior to the filing of the bankruptcy petition. 362(l) of the Code allows a tenant to deposit all of the rent that is due with the clerk of the court. This would enable a tenant to make an application for relief from the judgment of possession with the tenancy court. The second exception to the stay, Code sec. 362(b)(23) deals with evictions based on endangerment of the premises or illegal use of controlled dangerous substances at the rented premises. This section would apply if the eviction proceeding 29
was commenced before the filing of the bankruptcy case, or if the endangerment or illegal use occurred within 30 days before the bankruptcy filing. In either case, the landlord is required to file a certification with the bankruptcy court setting forth the facts the landlord alleges give rise to the exception, and the debtor would be able to contest the application. (6) TRANSFER TO SUPERIOR COURT I have included transfer to Superior Court under defenses, but it is more aptly entitled claim for off set. Because actions in the Landlord/Tenant court are summary proceedings, and the jurisdiction of the court is limited to awarding possession of the premises, the Rules of Court provide that a tenant may make a claim for relief which exceeds the Jurisdiction of the Special Civil Part by having the case transferred to the general jurisdiction of the Law Division. This procedure requires the tenant to file and serve a motion in the Landlord/Tenant Court. The leading case in New Jersey for the factors and standards considered on a removal motion is the 1970 case of Morroco v. Felton, 112 N.J. Super. 226. The recent trend in the landlord/tenant courts is away from favoring the transfer. That is, the tenancy court judges are retaining jurisdiction over the cases. Generally the judges allow the parties to engage in limited discovery which is otherwise not contemplated in the Court Rules of procedure in summary dispossess cases. (7) LANDLORD REGISTRATION ACT As explained in detail above, if a landlord fails to comply with the Landlord Registration Act, a judgment of possession may not enter. 30
(8) SECURITY DEPOSIT ACT If the landlord fails to notify the tenant of the location of the tenant's security deposit within 30 days after receipt, the tenant may elect to apply the deposit to the current rent due. See a detailed discussion of security deposits above. (9) RELOCATION ASSISTANCE When a landlord seeks to permanently board up or demolish the rented demised premises because of housing or health code violations, the Anti-Eviction Act, subsection (g) provides that no warrant of removal shall be issued until the Tenant Relocation Assistance Act (N.J.S.A. 52:31B1 and 20:4-1) provisions have been met. (10) PAYMENT OF RENT By far, the most common defense tenants raise to a landlord s allegation of non-payment of rent, is payment. The law provides: That if a tenant pays the outstanding rent together with the accrued costs of the proceedings, he may have the proceedings dismissed, Community Realty Management, Inc. v. Harris, 155 N.J. 212, 714 A.2d 282 (1998), and N.J.S.A. 2A:18-55. (11) No Right of Reentry Reserved When a landlord seeks to terminate a tenant s right to possession of demised premises based upon the breach of a lease covenant (or lease term) the lease must contain a reservation in the landlord to the right of reentry for such breach. Absent such a reservation of rights, the landlord s only recourse is to sue for money damages in a breach of contract case. (12) Requirements for an Attorney Unless the landlord is a sole proprietor or a partner in a general partnership, an attorney must be used to file the court papers AND appear in court on the landlord s behalf. If 31