The Conference Room--Answers to Questions on N.C. Law

Eviction

Landlords have a streamlined process in North Carolina to evict tenants who have breached their lease. This is called summary ejectment. After the tenant has breached the lease by failing to pay rent or otherwise, and after the tenant has failed to fix the problem pursuant to a grace period or period to cure, if any, in the lease, the landlord will provide a “notice to vacate,” either in writing or orally demanding that the tenant vacate the property. If the tenant leaves, it does not mean the landlord gives up any right he has to get back rent. Depending on the type of lease and the reason for eviction, the time of notice will vary. For the breach of a residential lease for failure to pay rent, 10 days’ notice is required.   

After the notice period has ended, the landlord may go to court and file for a Summary Ejectment, usually on a form from the clerk of court. The complaint states why the landlord wants the tenant to move out and when and where the court hearing will be held.

The complaint must be served on the tenant.  This is usually done by the sheriff or by certified mail, return receipt requested. Delivery may be in person or by tacking the papers on the tenant's door.  If delivery is by tacking the papers on the door, and if the tenant does not go to the hearing, the landlord cannot get a judgment against the tenant for rent owed. 

Unless there are other reasons from eviction than non-payment of rent, the tenant can stop the process by a “tender of rent” or paying the owed rent at or before the hearing.  

In the summary eviction process, as well as any other small claims court action, either party has a right to appeal. The landlord or tenant has 10 days after the magistrate judge’s decision to file an appeal or the judgment becomes permanent. For low income tenants, the filing fee for the appeal may be waived; however, there still may be a fee for the sheriff to deliver the notice of appeal to the landlord. The appeal will be heard in district court, which is harder to navigate by parties without an attorney than the small claims court. Even if an appeal is filed, the tenant is under an obligation to pay rent as it becomes due, however, it should be paid to the clerk of court rather than directly to the landlord.  

If the tenant appeals, about two months later, he will get a notice of the date of the district court (appeal) hearing. That hearing is similar to the small claims court hearing in that the judge will hear the facts of the case from both sides and make a decision. The district court judge can ignore nearly anything the magistrate court decided. After the district court hearing, the losing party has the opportunity to file another appeal with the North Carolina Court of Appeals. This step is seldom taken since the Court of Appeals will not consider the facts, only if the district court judge made an error of law.  

If the tenant does not file for an appeal, or the tenant appeals but fails to pay the rent as it becomes due to the clerk of court, then the tenant has 10 days after the magistrate judge’s ruling to move out. If the tenant has lost an appeal, he has 30 days to move out. If the tenant has not moved out before the applicable deadline, the landlord can get a writ of possession directing the sheriff to remove the tenant and padlock the property. The sheriff will give the tenant notice of the date and time when he intends to remove you from the property, usually 2-3 days after obtaining the writ.

After the eviction and the padlocking, the tenant has 10 days to contact the landlord and arrange to move any personal items that remain. The landlord only has to give the tenant one chance to get his or her belongings.  If the belongings are still there after the 10 day period, the landlord may dispose of them as he wishes.

 -Bradley A. Coxe is a practicing attorney in Wilmington, NC who practices in Personal Injury, Car Accidents, Medical Malpractice, Contract and Real Estate disputes, and all forms of Civil Litigation.  Please contact him at (910) 772-1678.

 

Snakes on a Plaintiff

I had a call today from a residential tenant with problem—She found a copperhead snake in her back yard. Now this being North Carolina, which happens to have the distinction as having the highest rate of venomous snake bites in the country, I didn’t see much of an issue. She told me the wildlife removal expert she had called told her the same thing, until he realized that he had removed 17 poisonous snakes from her neighbor’s house a few years before.

The Residential Rental Agreement Act in North Carolina provides for rights and duties of landlords and tenants. The landlord is required to repair or remedy “any imminently dangerous condition” on the premises and the tenant is allowed to recover from the landlord any payments for such repairs that he had to make. The yard of a rental home is included in the leased premises. The statute lists a number of items that constitute an “imminently dangerous condition.” While a rat infestation and mosquito infestation are included, a snake infestation is not.

However, the statute does include the duty to do whatever is necessary to put and keep the premises in a “fit and habitable condition.” Where one or a few snakes would likely not render a premises as unfit, particularly if they remain outside in the yard, at a certain point, depending on the number, location, and danger of the snakes, the infestation could rise to be sufficient to trigger the landlord’s duty to remedy the situation. (Like this house for example)     

My advice to her? Get the wildlife specialist to get rid of the snakes and do what is possible to prevent them from coming back. Then ask the landlord to pay for the treatment. If he refuses, she may have to file a lawsuit. However, unless the health department tells her to move out and condemns the property, she can’t move out or refuse to pay rent without breaching the lease.  

-Bradley A. Coxe is a practicing attorney in Wilmington, NC who practices in Personal Injury, Car Accidents, Medical Malpractice, Contract and Real Estate disputes, and all forms of Civil Litigation.  Please contact him at (910) 772-1678.

Two Tenants, One Apartment.

I recently competed a semi-famous one-act play entitled "Box and Cox."  The play is a 19th century farce about two men. Cox works all day as a hatter, and Box works all night as a printer. An enterprising landlord, Mr. Bouncer, decides to rent them the same room without telling them. This works remarkable well, until Cox gets a rare day off and finds Box in “his” room. How would this play out under modern North Carolina landlord/tenant law?

In North Carolina, in every residential lease, there is a promise that the tenant will have undisturbed use and enjoyment of real property. Known as a covenant for quiet enjoyment, this promise is implied in a lease, even if it is not expressly written into the lease. Mrs. Bouncer would have breached this covenant of quiet enjoyment as to both Box and Cox. Both parties would have a cause of action against Bouncer. Assume that Box signed his lease before Cox. Box would therefore have the legal right to the room. He could also recover any monetary damages against Bouncer he may have suffered, including increased utility fees, personal items (coal, sugar, candles and Lucifer matches, according to the script) that were consumed unknowingly by Cox. He could also sue for a return of some of his rent. A “rent abatement” action allows the wronged tenant the difference between the rent actually paid, and the market value of what was actually received. If Bouncer had leased to two tenants who knew they would be sharing, how much less would those hypothetical renters have paid? The one thing that Box could not do (unless Bouncer agreed to it) would be to break the lease and move out. Only where the landlord actually physically removes or blocks access to the premises (eviction) or where the circumstances make it impossible to remain on the premises (constructive eviction) could he legally break the lease.

Cox would have a claim for monetary damages against Bouncer, but couldn’t get the actual room (what the law calls “specific performance”). In addition to a recover for the same types of monetary damages that Box would enjoy, Cox’s monetary damages could also include the difference between the cost of a comparable room and Bouncer’s room, moving and relocation expenses.

--Bradley A. Coxe is a practicing attorney in Wilmington, NC with Hodges & Coxe PC who specializes in Personal Injury, Medical Malpractice, Homeowner's Associations, Contract and Real Estate disputes and all forms of Civil Litigation.  Please contact him at (910) 772-1678.

Tenant's Rights in Foreclosures

English: Foreclosure signs, Mortgage crisis, (Photo credit: Wikipedia)

With the downturn of the economy, and the burst of the housing bubble, large numbers of landlords find themselves unable to meet their mortgage payments and their rental property goes into foreclosure. If you a a tenant, with a valid lease on the foreclosed property, what rights do you have?

The “Protecting Tenants at Foreclosure Act of 2009” provides federal law on the matter of tenants’ rights at foreclosure and is applicable until December 31, 2014 at which point it will expire.  There is also North Carolina state law which applies in specific circumstances to tenants’ rights at foreclosure. 

When there is foreclosure of a residential property, such as a home or apartment complex, there are several protections in place for the tenant of the property.  Federal law allows the tenant to remain in the residence through the remainder of the lease term even though the property has been foreclosed and sold.  There are two exceptions to this general rule.  First, if the purchaser of the foreclosed property will use the property as his primary residence, he may terminate the lease after providing a ninety (90) days notice to the tenant.  This would require the tenant to be off of the property ninety (90) days after the notice is provided to him.  The second exception applies when there is no lease between the tenant and the owner of the foreclosed property or the lease is described as being terminable at the will of either party, meaning that at any point during the tenancy either party (landlord or tenant) can choose to end the lease.  As with the first exception, when there is no lease or the lease is terminable at will, the purchaser of the property must give ninety (90) days notice to the tenant prior to terminating the tenancy. 

The above exceptions apply so long as three requirements are satisfied.  The mortgagor (former owner of the property) or his child, spouse, or parent cannot be the tenant on the foreclosed property.  The lease for the property must have been created by a transaction in which both parties were acting independently and have no relationship to each other.  Lastly, the rent being paid for the tenancy of the property cannot be significantly less than the fair market rental value for the property.  If these requirements are satisfied then the lease or tenancy is considered bona fide, meaning it was made in good faith without deceit or fraud.

Furthermore, the federal law speaks directly about tenants of Section 8 housing rights at foreclosure.  Section 8 provides housing assistance to low income families by paying a portion of rent and utility bills, allowing the families to obtain an adequate place to live.  If the tenant is a Section 8 tenant as described in the United States Housing Act of 1937 (42 U.S.C. 1437f(o)(7)), the tenant may only be evicted if the purchaser of the property will occupy the property as his primary residence.  Again, it is required that the tenant must be given ninety (90) days notice before eviction can take place.

 In addition to the federal law regarding a tenant’s right at foreclosure, North Carolina General Statute § 42-45.2 applies when the lease or tenancy is not bona fide as described above or the tenancy is not a result of Section 8 housing.

 When North Carolina law applies to a tenant’s rights at foreclosure, it is necessary to know if the residential property contains less than fifteen (15) rental units or fifteen (15) or more rental units.  If the property contains less than fifteen (15) units, the tenant can, upon notice of foreclosure sale, terminate his lease by giving the landlord written notice of termination at least ten (10) days after the notice of sale.  Also, if the property contains less than fifteen (15) rental units and the tenant does not terminate his lease, the tenant must be given ten (10) days notice prior to eviction.  Alternatively, if the property contains fifteen (15) or more rental units, tenants must be given thirty (30) days notice prior to eviction.

In most circumstances it is likely that the federal “Protecting Tenants at Foreclosure Act of 2009” will apply giving tenants the option to remain on the property until the end of their lease term or providing ninety (90) days notice when either of the two exceptions apply.  The North Carolina statute which provides less notice to tenants prior to eviction will only apply when the federal law is not applicable because the tenancy or lease is not bona fide or there is not a Section 8 tenancy.

--Bradley A. Coxe is a practicing attorney in Wilmington, NC with Hodges & Coxe PC who specializes in Personal Injury, Medical Malpractice, Homeowner's Associations, Contract and Real Estate disputes and all forms of Civil Litigation.  Please contact him at (910) 772-1678. 

Rights of a Landlord and Duties of a Tenant

In an earlier post, I discussed the Rights of a Tenant and Duties of a Landlord for residential rentals under North Carolina law. Today I thought I would discuss the flip side. If you are the landlord, what rights to you have and if you are a tenant, what are your duties? (These rules are for residential leases, commercial leases have different rules).

Again, as before, the controlling document is the lease agreement. In general however, the tenant has the following duties and responsibilities:

1. Pay the rent on time under the terms of the lease. Remember, this is a separate duty of the tenant and therefore the tenant can’t refuse to honor this duty even if the landlord neglects their duties.

2. Keep the property clean and safe. Do normal household maintenance. Take out the garbage, keep the plumbing clean, keep the yard maintained, etc.

3. Cause no damage to the property or allow a guest to cause damage.

4. Replace the batteries as needed in a battery-operated smoke detector and notify the landlord if it needs to be repaired or replaced.

5. If you decide to move out, give your landlord notice. Many leases will provide for the correct notice of termination. Keep in mind that the notice requirement is for the end of the lease term, not a way to terminate in the middle. For example, if you have a one year lease, from January to January, and you see a 30 day notice requirement in your lease, that doesn’t mean you can give 30 days notice in March and move out in April without breaking the lease. That type of notice requirement means that in December you have to give notice that you will move out in January. If not, you may automatically have the lease renewed for another month or even year. If the lease doesn’t specify notice, North Carolina law states that proper notice is: 2 days if you rent weekly; 7 days if you rent monthly, (“month to month”); 30 days if your lease is for a year (even if you have to pay rent monthly); and 30 days if you own a mobile home and rent the lot. There is no law specifying the type of notice required, but it is always better to put it in writing so that you have a written record if questions come up later.

A landlord has the following rights:

1. To rent the property for whatever amount you choose, although you cannot raise rent during the term of the lease and you must give proper notice if you change the rent at the end of the term.

2. You can rent to whomever you choose, and refuse to rent to whomever you choose, except you cannot refuse to rent on the basis of race, color, religion, ancestry, sex, country of birth, handicap or family status (for example in most circumstance you cannot refuse to rent to someone with children).

3. You can reserve the right to enter, inspect and make repairs on or show the rental property at reasonable times and in a reasonable manner.

4. You have the right to have the property returned at the end of the term undamaged except for ordinary wear and tear.

5. You can charge a late fee on any rental payment five days or more late, of $15 or 5% of the payment, whichever is more. You can only impose one late charge per pay period and you can’t deduct a subsequent rental payment so as to cause the subsequent rental payment to be in default.

6. You are entitled to keep any improvement affixed to the property such as carpet, light fixtures, shutters, trees, etc.

7. You can charge a security deposit equal to two weeks rent for a week to week lease; one and a half month’s rent for a month to month lease; and up to two months’ rent for a longer term. The landlord must deposit the security deposit in a bank or obtain a bond to secure repayment. If the tenant breaches the lease the security deposit can be used to repay rent owed, damage to the property, legal fees for eviction and liens created. If the tenant leaves without breaching the lease, the security deposit must be returned in 30 days in full or provide an itemized statement of any damage or injury together with the balance of the deposit. The landlord cannot withhold amounts from the security deposit for normal wear and tear. If the landlord withholds the security deposit without authority, he can be sued for the amount by the former tenant for the deposit amount and attorney fees.

8. A landlord can evict tenants for a breach of the lease by a special court proceeding called summary ejectment. A landlord cannot use self-help such as cutting off utilities or changing the locks. Summary ejectment takes place in Magistrate's Court. The Clerk of Court should have the special magistrate court forms you can use for an ejectment. An accelerated ejectment procedure is available if criminal activity (such as drug trafficking) has occurred at the residence.

--Bradley A. Coxe is a practicing attorney in Wilmington, NC who specializes in Personal Injury, Medical Malpractice, Contract and Real Estate disputes and all forms of Civil Litigation.    

Rights of a Renter and Duties of a Landlord

Almost 1 million people in North Carolina are renting their house or apartment.  Even though they are not the owners of where they live, it is their home.  As such, it is very important to them.  As somebody who has a home, but doesn’t own that home, what rights do they have?   

Your lease is the most important document to set forth both yours and your landlord’s rights and duties.  Several of the rights and duties I will discuss can be varied by that written agreement.  When you have a question, the first thing you do is pick up the lease and read it.  Generally however, the lease will assign certain duties to the landlord and certain duties to you, the tenant.  The landlord must:

1. Make any repairs needed to keep the place fit and safe.
2. Keep the plumbing, heating, and electrical equipment in good and safe working order.
3. Provide a smoke alarm.
4. Obey local housing codes.  In my hometown, that would be Wilmington NC.
5. Notify you if he sells the property.  (Unless your lease says otherwise, you are not required to leave if the property is sold.  The new owner takes ownership subject to the tenant’s rights from the lease).
6.  Notify you in writing of any complaints she has about your treatment of the property.
7.  Leave you alone.  Generally, a tenant has the right to treat the property as their own.  Unless there is specific language in the lease, a tenant has the power to allow or refuse the landlord or anyone else from coming on the property, just as if she owned it. 

What do you do if the landlord doesn’t follow these rules?  First, try and get it settled out of court.  Write your landlord a letter describing the problem in detail, ask him to make repairs, and ask for a response in a reasonable amount of time.  If it is an emergency or you have to have something quickly repaired to prevent further damage to the property, go ahead and do it and forward the landlord the invoice.  YOU CANNOT WITHHOLD RENT.  If you do, you will be in breach of the lease and the landlord can evict you and sue you for damages.  However, you can agree with the landlord on a lesser amount of rent if the problem is not resolved or will take some time to fix.  Any agreement you make with the landlord, get it in writing.  As PT Barnum once said, “a verbal contract isn’t worth the paper it’s printed on.” 

If you and your landlord cannot get the matter resolved, you can bring a claim against a landlord in court.  If the damages claimed for a breach of the landlord’s duties are less than $5000 you should bring the claim in small claims court.  For most breaches of a landlord’s duty, the damages are the difference between what you agreed to pay in rent without the defect and a fair rental value with the defect.  This is also called rent abatement.  For example, if your air conditioning breaks, you should only have to pay the reasonable rent for a property without air conditioning, instead of the full amount that you agreed to with air conditioning.  You do NOT have the right to simply end the lease.  If however, the defect is so severe that you are unable to remain on the property and are forced to move out, for example, one our Hurricane visitors blows the entire roof off the house, and the walls are threatening to cave in, you would have an action for any damages you suffered under a type of wrongful eviction called constructive eviction.   

If a tenant is wrongfully evicted, either through the property being unlivable or the landlord not using the proper court process to evict (called “summary ejectment”) you would have a claim for damages suffered.   These damages may include moving costs and the difference between the rent you were supposed to pay and the housing expense at your new home during the time that the lease was supposed to run.  Also, while rare, it is possible, if the landlord’s conduct or the problem is bad enough, that the court could award a tenant with three times their actual damages for an “unfair and deceptive trade practice.”  A landlord may also be liable for personal injury to a tenant or her guests if they are injured by a hidden defect that the landlord caused, knew about, or should have known about.  Finally, if the landlord refuses to return your security deposit, you can bring a claim.  Keep in mind however, that the landlord is entitled to take from the security deposit any rent you owe, damage other than normal wear and tear you’ve caused to the property, costs of finding a new tenant if you leave before your lease ends, and any court costs if you have been evicted in court.