Question:  All indications are that the 2023 legislature is going to revisit the rent increase formula currently in effect, and once passed it would likely become law immediately upon the Governor’s signature. How can landlords deal with having already issued a September 2022 90-day rent increase notice if the 2023 rent cap is legislatively reduced before the landlord’s previously-issued September 2022 increase goes into effect?

 

 

By:  Phil Querin, MHCO Legal Counsel

 

The Oregon Governor will sign HB 2001 on Wednesday, March 29, 2023; it makes significant changes to the Oregon Residential Landlord Tenant Act (“ORLTA”). Here is a summary of those provisions most likely to impact landlords and tenants in Oregon manufactured housing communities.

 

Nonpayment of Rent Notices. Prior to the Pandemic, landlords issued  72-hour or 144-hour notices for nonpayment of rent. During the Pandemic the Oregon Legislature extended those timeframes to 10-days and 13-days, respectively; they only recently returned to the 72/144 hour notices.

 

HB 2001 will permanently restore the longer 10-day and 13-day periods for nonpayment of rent notices. Note: This will not apply to week-to-week tenancies, which will continue to be terminated with a 72-hour notice of nonpayment.

 

“Nonpayment” Terminations. HB 2001 will be adding permanent language to ORLTA defining an entire class of terminations and evictions for nonpayment. These terminations for nonpayment will be subject to additional notice requirements and longer timelines in Eviction proceedings, whereas terminations for all other causes will remain the same.

 

Under HB 2001 “nonpayment” will be defined as “the nonpayment of a payment that is due to the landlord, including a payment of rent, late charges, utility or service charges or any other charge or fee described in the rental agreement” or in the following statutes:

 

• ORS 90.140 – defines types of payments a landlord may require or accept;
• ORS 90.302 – fees for landlord expenses;
• ORS 90.315 – utility or service payments (not in manufactured housing/floating homes);
• ORS 90.392 – for cause terminations;
• ORS 90.394 – failure to pay rent;
• ORS 90.560-90.584 – utility and service charges (manufactured housing/floating homes);
• ORS 90.630 – landlord termination (manufactured housing/floating homes);

 

These are the same statutes and categories that constituted “nonpayment” under the Covid regulations. They are not so much “changes”, but rather a return to the definition of “nonpayment” that was created back in the Spring of 2020. The important thing to note is that a termination based on tenant’s failure to pay rent, charges or fees under these statutes will be considered a “nonpayment” termination and therefore subject to  additional notice requirements and an extended eviction timeframe.

 

Tenant Notice: Nonpayment Eviction Resources. HB 2001 reintroduces the tenant notice requirement (the “Notice”) that must accompany terminations and evictions based on nonpayment. The Notice will be drafted, updated, translated, and maintained by the Judicial Department and Oregon Housing and Community Services. It contains a list of resources for tenants directing them where to apply for housing assistance and/or seek legal services in relation to a termination or eviction. The Notice must accompany:

 

• Any notice of termination for nonpayment; and
• Any summons for an eviction proceeding based on a termination for nonpayment whether served by the landlord or by a process server.

 

Failure to serve the Notice with a nonpayment-based termination notice and a summons will be grounds for the Court to dismiss an eviction complaint.

 

First Appearances and FED Trials. For an Eviction based on nonpayment under ORS 90.392 (for cause) or ORS 90.394 (failure to pay rent), the timelines for first appearance and trial in an FED are extended. First appearances will be set roughly 15 days after the initial filing for FED actions involving nonpayment under those statutes. Clerks will have the ability to extend that timeline by up to 7 days if a judge is unavailable on the 15th day or to accommodate the plaintiff’s schedule.

 

An FED trial for a nonpayment eviction, if necessary, will be scheduled no earlier than 15 days, and no later than 30 days, after the first appearance.

 

All other Evictions, not based on allegations of nonpayment under ORS 90.392 (for cause) or 90.394 (failure to pay rent), will be scheduled for first appearance within roughly 7 days of filing. Clerks will have the ability to extend that timeline by up to 7 days if a judge is unavailable or to accommodate the plaintiff’s schedule. Trials for all other Evictions will occur no later than 15 days after first appearance.

 

An Eviction Under ORS 90.630 (termination by MHP landlord) would be subject to a 7-day window for first appearance, but, if the underlying termination was based on nonpayment, the trial would be scheduled between 15-30 days after first appearance.

 

If, through no fault of the landlord, trial for any type of Eviction does not take place within the specified time frames (15-30 days for nonpayment; 15 days for all others) the court may require the tenant to tender rent to the court.[1]

 

Court Obligation to Dismiss. HB 2001 dictates a number of circumstances in which the court will be required to dismiss an Eviction complaint. Henceforth, dismissal will be warranted when:

 

• A landlord fails to provide the Tenant Notice in a nonpayment eviction (termination AND summons);
• A landlord causes a tenant not to tender rent, including by failing to “reasonably participate” in a rental assistance program;
• The tenant has tendered, or caused to be tendered through rental assistance or any other payment, the outstanding amount owed in the Nonpayment Notice;
  • If payment of the unpaid amount is received AFTER commencement of the FED action, tenant will not be entitled to prevailing party fees. Tenant may also be charged landlord’s filing fees.
• A landlord files an FED based on unlawful holding by force (ORS 105.115)before the expiration of (a) a fixed term tenancy or (b) the time period specified in the termination notice.
  • NOTE: HB 2001 also expands the definition of “holding by force” to mean refusing to pay rent within the time period required by an ORS 90.392 (for cause) or ORS 90.394 (failure to pay rent) notice. Previously, holding by force only applied to 90.394 (failure to pay rent).

 

Default Judgments at First Appearance. HB 2001 makes a modification to the process for a landlord receiving a default judgment at the first appearance. To obtain an order of default:

 

• The plaintiff (landlord or landlord’s representative) must appear and the defendant/tenant must fail to appear;
• The court must determine that the FED complaint complies with ORS 105.115 (unlawful holding by force) and ORS 105.124 (form of complaint);
• The landlord must testify under oath or submit an affidavit or declaration under penalty of perjury that:
  • Landlord does not have knowledge that the tenant has delivered possession; and
  • Landlord believes that the tenant remains in possession.

 

Sealing Eviction Records. The courts will be required to conduct an annual review of completed FED proceedings to determine which ones will remain on a tenant’s record. A judgment will be set aside and the record will be sealed in the following situations:

 

• A judgment was either not for a money award, or the money award  expired or had been satisfied/discharged; and
• Five years have passed since a judgment of restitution; or 12 months have passed since a stipulated judgment between landlord and tenant.

 

Once a record is sealed and set aside, a tenant will not be required to disclose the judgment. This record-sealing process is supposed to be conducted by the court on a regular basis, but it does not prevent a tenant from taking the initiative to apply for a set aside under ORS 105.163 (setting aside judgment). The court’s first review of old records must be completed by December 31, 2024.

 

What Now?!  HB 2001 does not contain any direction going forward, i.e., how landlords are to deal with terminations for nonpayment that are already in process. Accordingly, I’ve listed below my thoughts. Readers should check with their own legal counsel.

 

• If a notice of default (“NOD”) is going to be sent/delivered to the tenant tomorrow, March 29, 2023, when the Governor signs the Bill, it is safest to assume that regardless of the time of day, it should conform to the new law.
• If the 72/144 hour NOD has been delivered but not expired, the safest approach is to start over under the new law. You don’t want to do otherwise, then get into court and try to convince the Judge the eviction process had already “commenced” before the Governor signed the Bill. If in doubt, the court will generally default for the most tenant-favorable position. Why? Because judges don’t like to get reversed on appeal.
• If FED has already been filed in court, what timelines apply are likely up to the Judge.
• Similarly, if the tenant does not show up for an eviction based on an NOD sent before March 29, 2023, landlord should be prepared to possibly have to testify under oath or submit an affidavit or declaration as discussed above.

 

[1] Enforcing the duty to tender rent in for-cause evictions can have a filtering effect in separating good faith tenant claims vs. those interposed to avoid the payment of rent.

Question:  .  What is the landlord’s responsibility when it comes to trees falling on a tenant’s house. Does it make a difference if it is a hazard tree vs. not a hazard tree? What about roots crossing over a space and causing damage to the home on the tenant’s space or the neighbor’s space?

 

Question  A:  We have a Tenant who has refused to fix the water leaks within their mobile home. The park owner pays for the water and there have been significant cost increases due to the leaks. 

The Lease is the MHCO Lease from 2003 and states under Tenant Agreements F. Maintain the Home in accordance with conditions set forth in Paragraph 12.A(8)(a) through (e) which states in (d) all electrical, water, storm water drainage and sewage disposal systems in, on, or about the Home, are in operable and safe condition, and that the connections to those systems have been maintained.

What recourse do we have in this situation?

Question B:  We have a tenant whose sewage line is routinely blocked.  We have had a plumber our numerous times and unclogged resident’s sewage line.  We have repeatedly told this resident that they cannot put certain items in the toilet - and yet they continue to do so and block the sewage line.  Does this constitute grounds for eviction?  At what point is the resident responsible for the sewage line and the items they are putting in the toilet?Question B:  We have a tenant whose sewage line is routinely blocked.  We have had a plumber our numerous times and unclogged resident’s sewage line.  We have repeatedly told this resident that they cannot put certain items in the toilet - and yet they continue to do so and block the sewage line.  Does this constitute grounds for eviction?  At what point is the resident responsible for the sewage line and the items they are putting in the toilet?

 

 

By way of refresher, ORS 90.630 pertains to curable maintenance/appearance violations relating to residents’ spaces.  However, if the violation relates to the physical condition of the home’s exterior, ORS 90.632 applies, to address repair and/or remediation that can take more time to cure, either due to the weather, the amount or complexity of the work, or availability of qualified workers.

 

As a result, SB 277A, which became law on June 14, 2017 (“Effective Date”), will apply: (a) To rental agreements for fixed term tenancies – i.e. leases – entered into or renewed on or after the Effective Date; and, (b) To rental agreements for periodic tenancies – i.e. month-to-month tenancies – in effect on or after the Effective Date.

 

MHCO has significantly changed its current form No. 55 to address the changes in the new law. The major issue going forward is for managers and landlords to be able to recognize when to use Form No. 55 to address disrepair and deterioration conditions, versus Form No. 43C, which is appropriate for violations relating to maintenance and appearance of the space.