Phil Querin Q&A: Utility or Service Charge Payments

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October 16, 2017
Phil Querin
MHCO Legal Counsel
Querin Law

Question. To assess a tenant for a utility or service charge for any billing period using the billing method described in ORS 90.532 (1)(b)(C)(ii) or (c) of this section, I understand that the landlord is to give the tenant a written notice stating the amount of the utility or service charge they are to pay and the due date for making the payment. According to the statute, the due date may not be less than 14 days from the date of service of the notice. The amount of the charge is determined according to ORS 90.534 or 90.536. If the rental agreement allows delivery of notice of a utility or service charge by electronic means, for purposes of this subsection, written notice includes a communication that is transmitted in a manner that is electronic, as defined in ORS 84.004.

 

My problem is that rent is due seven days from the first of the month, yet the due date for utility charges cannot be less than 14 days. Any recommendations on how to reconcile this?

 

 

Answer. You are referring to ORS 90.532 (4) (Billing methods for utility or service charges; system maintenance; restriction on charging for water.) which provides:

 

(4) To assess a tenant for a utility or service charge for any billing period, the landlord shall give the tenant a written notice stating the amount of the utility or service charge that the tenant is to pay the landlord and the due date for making the payment. The due date may not be less than 14 days from the date of service of the notice.

 

However, this is the 2009 statute. You should be relying upon is subsection (6) of the 2015 version of ORS 90.532, which provides:

 

(6) To assess a tenant for a utility or service charge for any billing period using the billing method described in subsection (1)(b)(C)(ii) or (c) of this section, the landlord shall give the tenant a written notice stating the amount of the utility or service charge that the tenant is to pay the landlord and the due date for making the payment. The due date may not be before the date of service of the notice. The amount of the charge is determined as described in ORS 90.534 or 90.536. If the rental agreement allows delivery of notice of a utility or service charge by electronic means, for purposes of this subsection, “written notice” includes a communication that is transmitted in a manner that is electronic, as defined in ORS 84.004. If the landlord includes in the notice a statement of the rent due, the landlord shall separately and clearly state the amount of the rent and the amount of the utility or service charge.

 

 

 

To appreciate the differences, I’ve set out below a mark-up of the changes, showing how the 2015 statute differs from the 2009 law (grey text was stricken, and yellow text was added):

 

90.532 (4) (Billing methods for utility or service charges; system maintenance; restriction on charging for water.) provides:(6) To assess a tenant for a utility or service charge for any billing period using the billing method described in subsection (1)(b)(C)(ii) or (c) of this section, the landlord shall give the tenant a written notice stating the amount of the utility or service charge that the tenant is to pay the landlord and the due date for making the payment. The due date may not be less than 14 days from the date of service of the notice.before the date of service of the notice. The amount of the charge is determined as described in ORS 90.534 or 90.536. If the rental agreement allows delivery of notice of a utility or service charge by electronic means, for purposes of this subsection, “written notice” includes a communication that is transmitted in a manner that is electronic, as defined in ORS 84.004. If the landlord includes in the notice a statement of the rent due, the landlord shall separately and clearly state the amount of the rent and the amount of the utility or service charge.

 

So ORS 90.532 was amended in 2013. Per John VanLandingham[1], who participated in making the change, when the 14 day deadline for payment was deleted, it was recognized that the way for landlords to enforce nonpayment of a utility charge was through the 30-day, curable notice, under 90.630 (Termination by landlord).  MHCO member, Phil Taylor, led the push for this legislation. (See, HB 3482, chapter laws 443 2013). This is now clarified in the current ORS 90.532(7):

 

A utility or service charge is not rent or a fee. Nonpayment of a utility or service charge is not grounds for termination of a rental agreement for nonpayment of rent under ORS 90.394 (Termination of rental agreement for failure to pay rent), but is grounds for termination of a rental agreement for cause under ORS 90.630 (Termination by landlord). A landlord may not give a notice of termination of a rental agreement under ORS 90.630 (Termination by landlord) for nonpayment of a utility or service charge sooner than the eighth day, including the first day the utility or service charge is due, after the landlord gives the tenant the written notice stating the amount of the utility or service charge. (Emphasis added.)

 

Prior to these changes, the statutes were confusing as to when a utility charge was due, and when it was late, for purposes of issuing a termination notice. Now, the utility charge is due upon delivery of the bill.  If it is not paid by the 8th day after delivery, it is considered late, and a landlord can give a curable 30-day cause termination notice. The cause of the notice is non- payment of the utility charge, and the cure is payment.   

                     
Conclusion. The take-away here for readers is to always make sure you’re reviewing the latest statute. The best resources is the Oregon Legislature website: https://www.oregonlegislature. gov/bills_laws/Pages/ORS.aspx.  You will note that at the bottom of each statute is the legislat- ive history, i.e. the amendments that preceded it. This website also contains a link to the archives, i.e. the earlier versions of the statutes: https://www.oregonlegislature.gov /bills_ laws/ Pages/ORSarchive.aspx  

 


[1] John’s invaluable assistance is gratefully acknowledged in explaining the legislative history of these changes above.

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