Small property owners and small businesspeople: a call for fairness

Issue August 2015 August 2015 By Jordana Roubicek Greenman

Since publishing an article last year about the trials and tribulations of the small landlord, I believe the problems addressed in that article persist. In a consumer-friendly state like the commonwealth of Massachusetts, the laws (i.e., statutes, court rules and the cases interpreting them) weigh heavily in favor of tenants. The core issue is the basic human requirement for shelter that should be considered in seeking common ground for preventing or at least reducing homelessness. Homelessness is a serious social and political problem that permeates our economy. Despite the severity of the issue, too often it is the small property owner who is targeted for its cure. Thus, the right of a small property owner to rightfully obtain possession of his or her own property due to tenant behavior or business necessity is frequently thwarted by actions that on the surface are intended to protect the rights of individuals who lack means.

When moving into a residential rental property, an individual agrees to pay the owner a set amount each month in exchange for the right to continue to occupy that property for a contracted period of time. The difficulty of resolving disputes between property owners and their residential tenants in Massachusetts results in an economic necessity for the owner to pay an outgoing tenant money as incentive to leave at the end of the contract in order to avoid being mired in a legal battle to obtain possession of his or her own property. Such a result was certainly not the intention of the statutes, court rules and the cases interpreting them. However, the use of such tactics has become common practice.

I was recently involved in a case in which the owner needed to raise the rent to market value -- an amount the tenant could not pay. This particular case involved both disabilities and the receiving of government benefits. After commencing suit, the landlords were accused of discrimination, negligence, infliction of emotional distress and alleged inspection violations. Although such accusations would never have been made had the landlord not sought to collect a higher rent, these otherwise valid tactics are often successfully used to indefinitely postpone an eviction, regardless of the legitimacy of the claims to a specific fact pattern and regardless of the very real need some small landlords may have to gain possession of their property. Even if owners agree to pay "cash for keys," a tenant often remains in a position to dictate other, often overreaching, terms.

It is a common practice for tenants to allege violations of the Sanitary Code to fight evictions. While the tenants may refuse to allow inspections to ensure there are no cracks in walls, loose tiles or an infinite number of other miniscule conditions, tenants rarely inform their landlords about such needs for repair before facing eviction. As soon as they are served, however, the war is on -- frequently with the pre-printed forms made available by pro bono legal services groups. Although such matters do not legally constitute a defense to an eviction unless reported to the landlord or the local board of health prior to a notice to quit served by the landlord, there is never hesitation to try to obfuscate the issues, including raising such facts as the tenant being disabled, over 60 and/or that a disabled person is living with them. The raising of any of these issues can result in an automatic stay for between six and 12 months. Although the legal services are performing the services for which they were rightly established, our society in general and the current system of resolving landlord-tenant disputes turns completely ignores the plight of small landlord and the responsibility of a tenant to conform to his or her responsibilities. Not only does this approach fail to appropriately deal with the problem of homelessness, it puts the small landlords in jeopardy of losing their property or being forced into bankruptcy, or both.

Another big hurdle arises in cases involving "cause" to evict. Among the basic responsibilities of a landlord is the responsibility to act when the rights of one tenant are violated by the actions of another tenant. However, even if a landlord fulfills the duty to commence an action against the "problem tenant" for eviction or otherwise, the aggrieved tenant is often unwilling to provide the necessary corroboration in an attempt to avoid potential conflict or even threatened harm.

Until these issues are rectified by legislative and/or regulatory action, property owner decisions about whether to take on a tenant, and the terms and conditions of the tenancies, will be subject to laws as they are written and enforced in court decisions. The small landlord, unfortunately, often has little or no ability to financially survive many typical outcomes. Nothing will change unless there are concerted efforts to educate landlords and the landlord bar, as well as to encourage them to begin a dialogue with lawmakers.

I recently accepted a mentoring position promoted by the Massachusetts Bar Association with respect to landlord-tenant matters. I will also be leading a two-part workshop for landlords with the Metropolitan Boston Housing Partnership this September. In my role as a mentor, I have been able to help fellow attorneys advise their clients on eviction matters as well as issues designed to prevent the need for an eviction (e.g., following all of the required steps prior to signing a lease with a tenant).

Being a landlord in Massachusetts carries risks, responsibilities and the availability of capital. Unless a landlord is willing to dedicate the time, effort and money to understand the laws and regulations, the landlord is likely to be at a severe disadvantage if a court action may ensue. In my practice, I continue to offer affordable fee structures and assistance on various levels, allowing landlords to obtain the advice and zealous advocacy they need, while also educating them in an effort to prevent further financial losses. I cannot stress enough the importance for a Massachusetts landlord to have trusted professionals (lawyers, accountants, brokers) to call. The economic viability of small landlords who want to offer the valuable commodity of rental housing will be more sustainable when they can take advantage of the advice of the services that should be provided by people whose jobs are to know, understand and apply the law, as well as to utilize it to avoid the serious and avoidable pitfalls of residential rental property.