It’s The Law – Advice on troubleshooting evictions.

By HOWARD BOOKSTAFF, Hoover Slovacek LLP , HAA General Counsel

TROUBLESHOOTING EVICTIONS

Evictions are supposed to be a summary procedure that is inexpensive and speedy. So, what happened?

OVER THE PAST two years, the eviction process has been confusing, complicated, time consuming and frustrating. Delays in the eviction process have created problems for both landlords and residents. Residents have large (sometimes really large!) delinquencies. Eviction delays have prevented landlords from reletting units to mitigate their damages. Residents are faced with increased credit and rental history problems that will be difficult (or impossible) to overcome.

How did we get here? Several issues have contributed to our current environment:

• 30-day notice to vacate requirements for certain properties covered by the CARES Act and new HUD and Federal Housing Finance Agency requirements

• Supreme Court Emergency Orders that have given judges flexibility leading to delays in the eviction process

• Supreme Court Emergency Orders that have allowed judges to abate and dismiss cases while the parties wait for rental assistance that may or may not ever come.

• Judicial interpretations of the federal and state law, rules and orders.

Some delays can’t be avoided, but some can. To minimize unnecessary delays, it is more important than ever that an owner properly prepare for an eviction proceeding. Here are a few tips to allow you to navigate through some of the most common problems owners have faced:

1. Service of the Notice to Vacate

The Property Code requires that the notice to vacate be given in person or by mail at the premises in question. Notice in person may be by personal delivery to the resident or any person residing at the premises who is 16 years of age or older or personal delivery to the premises and affixing the notice to the inside of the main entry door. Notice by mail may be by regular mail, registered mail or certified mail, return receipt requested, to the premises.

As an alternative, the owner may deliver the notice by securely affixing the notice to the outside of the main entry door; however, this method of delivery should be considered in only certain limited circumstances. Outside delivery can only be done if: (i) the premises has no mailbox and a keyless bolting device, alarm system or dangerous animal prevents the owner from entering the premises; or (ii) the owner reasonably believes that harm will result from personal delivery to the resident or by affixing the notice to the inside of the main entry door. Additionally, the notice must be placed in a sealed envelope with the resident’s name, address and in all capital letters, the words “IMPORTANT DOCUMENT” (or substantially similar language) and must be mailed no later than 5 p.m. on the same day from the same county in which the premises is located.

Since notice on the outside of the door requires that certain specific additional action be taken, and is only available in limited circumstances, the best approach, if possible, is to affix the notice to the inside of the door. Even if someone opens the door, if you are not sure if it’s the resident, the safest approach is to affix the notice to the inside of the door.

2. Be sure that the date and the number of days’ notice is correct

The Property Code provides that the owner must give at least three days’ written notice to vacate before the owner files a forcible detainer suit unless the parties have contracted for a shorter or longer period in a written lease or agreement. The TAA lease provides for a 24hour notice to vacate. However, if your property is subject to the CARES Act or the applicable HUD or FHFA rules, you would be required to give a 30-day notice in nonpayment of rent cases. Be sure that the date on the notice and the date that the resident is required to vacate properly reflect the number of days’ notice you are required to give.

3. Content of the notice

Be sure that the notice is not a “pay or quit” notice stating that the resident can either pay or vacate. The Property Code provides that, if before the notice is given, the owner has given a written notice or reminder that rent is due and unpaid, the owner may include in the notice to vacate a demand that the resident pay the delinquent rent or vacate the premises by the date and time stated in the notice. In other words, under Texas law, if the notice contains a demand to pay rent or vacate, the notice would only be proper if there was a previous notice or reminder that rent is due and unpaid. To avoid having to give two notices in an eviction proceeding, it would be best to simply provide an unconditional notice (a notice that states what the default is and requires the resident to vacate).

4. Acceptance of partial payments during the eviction process

The issue of waiver is presented when an owner accepts a partial payment of rent during the eviction process, after the notice to vacate is given. It is your choice whether or not to accept a partial payment. If you don’t accept the payment, you have solidified the argument that you want to go forward with recovering possession of the unit because of the resident’s delinquency. If you accept a partial payment, you run the risk of an argument that you have waived (given up) your right to continue with the existing eviction process for nonpayment of rent.

As indicated, it is your choice whether to accept the partial payment. However, if you do, in order to put yourself in the best position to defend against a waiver argument, it would be beneficial to respond to the acceptance of the partial payment with a letter to the resident stating that you have accepted the payment as a partial payment only, the resident remains delinquent, and you intend to continue with the eviction process due to the outstanding delinquency.

By sending the letter, you will be able to show the judge that you were transparent with the resident, you had no intent of accepting the partial payment in exchange for giving up any rights in the pending eviction process and you did not have any intent of entering into a payment plan with the resident.

5. Be prepared to answer rental assistance questions

The COVID rental assistance programs have been designed to keep a resident housed. They have not primarily been designed to pay the resident’s delinquency. However, the programs keep residents housed by paying the delinquency.

Since the purpose of the programs have been to keep residents housed, it is unlikely that you would be able to accept rental assistance while you are also evicting a resident.

Pursuant to the Supreme Court’s Emergency Order regarding rental assistance, a judge must, if the owner has a pending application for rental assistance or the owner and resident both express an interest in participating in an available rental assistance program, abate the eviction action for 60 days and dismiss the case with prejudice if the action is not reinstated within those 60 days.

Before you get to trial in an eviction case, a choice should be made. Do you want to continue to engage in the rental assistance process, which may involve waiting for rental assistance that may or may not ever come, or do you want possession of your unit?

If you decide not to accept rental assistance and go forward with the eviction, it may be beneficial to email the applicable rental assistance agency before trial to advise the agency that you are going forward with an eviction process and do not want rental assistance for that resident. Whether or not the agency responds, your email may be beneficial to show the judge that you have withdrawn any application for rental assistance with respect to that resident. The email, coupled with your statement that you do not have an interest in participating in an available rental assistance program, may convince the judge that you want to go forward on the eviction process, rather than wait for rental assistance.

6. Be sure you are suing in the right name

The lease should be in the name of the owner of the property or the owner’s assumed named.

Your notice to vacate and eviction petition should mirror the name of the owner on your lease.

7. If you use an assumed name in your petition, be sure an assumed name certificate is properly filed

Most apartment communities are owned by a single asset entity. Texas has adopted the Assumed Business or Professional Name Act (“Act”). The Act provides that most organizational entities must file an assumed name certificate in the office of the Secretary of State if the entity regularly conducts business in Texas under an assumed name.

An entity’s failure to comply with the Act does not impair the validity of any contract or prevent the entity from defending any action or proceeding in any court, but the entity may not maintain any action or proceeding arising out of a contract in which an assumed name was used until an original, new or renewed certificate has been filed as required by the Act.

In other words, if you use an assumed name in your lease, but have not properly filed an assumed name certificate, you run the risk of delaying the eviction until you properly file the certificate.

8. Using fraudulent names

We have faced a number of issues in the apartment industry regarding identity fraud. If you are evicting a resident who has used a false identity, and you are aware of your resident’s real name, it would be beneficial for the notice to vacate and the petition to identify both the real and false name used by the resident. This will give you consistency between your lease, notice to vacate and eviction petition. To avoid confusion, you might consider identifying the person as “(the resident’s real name) also known as (the resident’s fake name).”

9. Be sure to bring your witnesses to court

Whether your eviction is remote or in person, be sure you have witnesses ready to present the evidence you need in your case. In a non-payment of rent case, you want to be able to prove that the lease was signed, the notice was delivered and the resident failed to pay rent. In other types of evictions, you would need to prove that the default occurred with credible evidence. If the only people in court are those that do not have personal knowledge of the default, you run the risk of losing the case.

10. If you make a deal, do it in writing

Many owners have made payment plans over the past couple of years. If you are relying on a resident’s agreement to make regular payments, the agreement should be in writing. The agreement should also reflect what happens if the resident fails to comply.

Once you get to the eviction process, if a resident claims that a payment agreement has been made, it would be beneficial to have that agreement in writing so that there will be no confusion or misunderstanding with respect to the rights and responsibilities of the parties.

Evictions have become confusing, complicated and time consuming. By being properly prepared and doing certain things before and during the eviction process, you may be able to avoid unnecessary problems and delays.

Welcome to the “new normal” and good luck!