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Law360 (January 5, 2021, 4:59 PM EST) --
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| Ciaran Connelly |
The COVID-19 pandemic inspired state and local officials to issue a series of emergency orders, hastily passed legislation and overlapping ordinances that restricted landlords' right to evict their tenants. To comply with the law, landlords have had to carefully navigate these legal requirements to avoid the draconian consequences of violation.
And to make compliance even more difficult, new ordinances and orders are coming into effect all the time. For instance, Multnomah County extended its moratorium by six months, and the Oregon Legislature was called into a December special session considering yet another new regulatory regime.
As landlords attempt to navigate these shifting regulations, here are some considerations to keep in mind.
Examine the Scope of Current Eviction Moratoriums
First, a landlord must consider the scope and sources of eviction restrictions. Such restrictions can come from every state and local level, and even every branch of government.
At the federal level, the U.S. Centers for Disease Control and Prevention issued an order establishing an eviction moratorium. The CDC's order serves as a baseline, allowing for greater, but not lesser, levels of tenant protections at the state and local level.
In Oregon, Gov. Kate Brown and the Legislature have taken turns issuing executive orders and passing bills limiting evictions.
Generally, these moratoriums have prohibited no-cause evictions as well as evictions for nonpayment during defined emergency periods. The orders and bills have not, however, relieved tenants of their obligations to pay eventually. Nor have they eliminated a landlord's right to evict a tenant for causes other than nonpayment.
Most recently, these measures have created a grace period following expiration of the emergency, during which time a tenant must pay current rent, but cannot be evicted for nonpayment of rent that became due during the emergency.
The precise contours of these moratoriums are complicated and apply differently depending on whether the tenant is commercial or residential, and whether the residence is part of a single-family home or a multifamily unit. Landlords must understand the specific provisions that apply to a specific unit before pursuing eviction.
Early last year, the Oregon judicial branch also took steps to limit evictions. Oregon Supreme Court Chief Justice Martha Walters issued an order delaying all forcible entry and detainer first appearances until July.
While most county courts are once again hearing forcible entry and detainer actions, landlords should be aware that a new judicial order could limit their ability to enforce eviction rights even if eviction is permitted under legislation or executive orders.
Finally, a landlord must also consider local county and city ordinances that may limit their right to evict tenants. Multnomah County, for example, adopted a mandatory grace period long before the state Legislature did, and just extended its moratorium until July 2, 2021.
Understand the Stakes
A landlord who violates the eviction moratoriums faces stiff penalties and potential criminal liability. Violation of an emergency executive order, for example, is a misdemeanor.
State and local ordinances often allow tenants whose landlords attempt to violate the orders to recover three months' rent, plus actual damages and attorney fees. A landlord would do well, therefore, to be extremely cautious in pursuing any evictions while these moratoriums remain in effect.
A landlord may also be faced with difficult situations created by the pandemic itself. For example, a multifamily landlord may receive complaints from one tenant that another tenant is not observing mask mandates or other social gathering restrictions.
Or a commercial landlord may attempt to mandate masks only to have tenants claim that their customers are unable to comply. In such situations, a careful legal examination of lease provisions is warranted to determine what remedies — including potential for-cause eviction — may be available.
In addition, a landlord should keep in mind premoratorium provisions of Oregon law. For example, a landlord should know if accepting partial rent payments waives the landlord's rights under Oregon Revised Statutes Section 90.417. Recent legislation has provided a potential solution, but landlords should be sure to avoid unintended waiver.
Look for Potential Avenues of Relief
Landlords should be aware of potential avenues for relief other than eviction. A landlord should examine their insurance policies for potential coverage for lost rent or costs associated with complying with pandemic-related emergency orders.
Direct relief programs may provide help. Various rent assistance programs exist to help tenants pay rent. Landlords should be aware of these programs and consider helping their tenants apply.
Direct assistance to landlords may also be available: The Oregon Legislature created one such program during its December emergency session. Landlords should keep abreast of these programs and consider both the long- and short-term implications.
A landlord should consider negotiating directly with tenants to secure partial payment of rent in exchange for partial forgiveness.
Landlords who do so will need to carefully balance any proposed negotiated resolutions against the likely outcomes under the existing moratoriums and must also be careful to avoid unintentional waivers. When negotiating, landlords must be careful to stay within the bounds permitted by the eviction moratoriums.
A landlord might also seek relief from its lenders. Fannie Mae and Freddie Mac have programs in place to assist landlords. The Oregon Legislature passed H.B. 4204 earlier this year, which limited foreclosures and provided borrowers with certain relief.
Additional borrower-friendly legislation may be on the way. Even in the absence of legislation, however, a landlord's lender may be willing to forgive or forebear collection of some debt.
A landlord might pursue legal action to seek insurance coverage, relief from unfriendly lenders or even to challenge the eviction moratoriums directly under state or federal constitutional law. While such suits face significant challenges, they may nevertheless be worthwhile.
Conclusion
Oregon landlords should be careful to comply with the fast-evolving set of Oregon eviction moratoriums.
Landlords should document their moratorium- and pandemic-related losses to ensure they are able to take advantage of relief programs that may become available.
And finally, landlords should keep in mind that the moratoriums still allow evictions for causes other than nonpayment.
Ciaran P. A. Connelly is a partner at Ball Janik LLP.
The opinions expressed are those of the author(s) and do not necessarily reflect the views of the firm, its clients or Portfolio Media Inc., or any of its or their respective affiliates. This article is for general information purposes and is not intended to be and should not be taken as legal advice.
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