Evictions for Massachusetts Businesses: Get a Lawyer!

reversing-a-foreclosure

Massachusetts businesses in eviction proceedings have a unique requirement: they must be represented by a licensed attorney. This is true not just for eviction cases, but all civil actions (with the exception of small claims). Read on about this important topic.

Evictions for Massachusetts Businesses

A Massachusetts landlord is only entitled to represent themselves in an eviction if the tenancy is in their individual capacity. This is common for many small landlords, who own rental property individually, in their own name. These landlords are permitted to represent themselves in an eviction case.

If, however, the landlord is a business entity, such as a corporation or a limited liability company (“LLC”), the landlord must be represented by an attorney. This comes from a Supreme Judicial Court decision, which holds that such business entities cannot represent themselves in court. Most courts take the position that this requirement also applies to landlords organized as trusts.

Practical Implications

Another recent Supreme Judicial Court case, concerning who is entitled to bring an eviction, requires trial courts to take a careful look at the parties before them. If a corporation or LLC is appearing in an eviction case without an attorney, there is a strong chance that the court will dismiss the proceeding. For this reason, Massachusetts businesses should never take a chance of not having a lawyer in court. If there is any doubt about whether an attorney is needed for your eviction, speak to a lawyer before pursuing such a claim.

Landlords who are not business entities can represent themselves in court. Doing so, however, is not always a good idea. Massachusetts landlord-tenant law is complex, and if a matter proceeds to trial, most non-lawyers are unable to handle the procedural requirements for litigating a case. For this reason, hiring a competent attorney is a good idea.

Conclusion

If you need assistance with a Massachusetts eviction, contact me for a consultation.

What’s Required for a Foreclosure Default Notice? Massachusetts’s Highest Court Will Soon Clarify

foreclosure default notice

There is old saying for those living in New England: if you don’t like the weather, wait a few minutes. The same can be said about Massachusetts foreclosure law: if you don’t like a particular decision . . . wait a few minutes.

This is evident by a recent decision from the First Circuit Court of Appeals, that requests the Supreme Judicial Court to clarify the requirements for a foreclosure default notice, commonly known as “paragraph 22.” This comes from the Thompson decision, a ruling in favor of homeowners against a foreclosure sale that has been widely criticized by many in the real estate field. The full decision is below.

Background on Paragraph 22

The vast majority of homeowners in the United States have a mortgage agreement that uses a standard form. This standard form mortgage comes from Fannie Mae and Freddie Mac, and requires a lender to send a default notice prior to foreclosure. This requirement is generally found in paragraph 22 of this mortgage agreement.

This notice, among other things, requires specific disclosures to a homeowner prior to the start of foreclosure and provides the homeowner thirty days to pay the outstanding loan balance to avoid foreclosure.

In 2015, in a landmark court decision, the Supreme Judicial Court ruled in Pinti v. Emigrant Mortgage that lenders need to strictly comply with this foreclosure default notice requirement. Failure to include or correctly state one of the required disclosures in these notices can be grounds for setting aside a foreclosure.

The Thompson Decision

Earlier this year, the U.S. Court of Appeals for the First Circuit issued a decision applying the Pinti decision to an error in one of these paragraph 22 notices. In this decision, Thompson v. JPMorgan Chase Bank, the First Circuit ruled that the notice was defective because it mislead the borrower about when he could pay his outstanding loan balance to avoid foreclosure.

Importantly, the homeowner in Thompson never suffered any harm from this defect in his foreclosure default notice. The First Circuit suggested that any potential harm to a borrower in one of these notices was a violation of paragraph 22 and grounds for challenging a foreclosure’s validity.

Not surprisingly, many involved with Massachusetts real estate are concerned with the ramifications of this decision, and its impact on the foreclosure process. I, personally, have received many inquires about the ramifications of this decision; a sign that this area of Massachusetts foreclosure law remains in flux.

SJC to Review Requirements for a Foreclosure Default Notice

Thompson, importantly, was decided by a federal appeals court. The reason for this is that the case was brought into federal court from state court, which the law allows in certain circumstances.

The bank in Thompson asked for a reconsideration of this decision, which is rarely granted in appeals. The First Circuit declined to reconsider this decision, but instead, has asked the Supreme Judicial Court to clarify the law on foreclosure default notices and paragraph 22.

I, personally, have never heard of an appellate court doing this after issuing a decision. This is a good example of how Massachusetts foreclosure law continues to be an evolving area of law.

Conclusion

If you need assistance with a foreclosure matter, contact me for a consultation.

18-1559-2019-07-30

5 Things to Know About Massachusetts Land Court

Massachusetts has a unique forum for handling real estate disputes: Land Court. Land Court is a specialty court which handles a wide array of property issues, including Servicemembers’ Cases, boundary disputes, and other real property matters. Those involved with a real estate issue should be familiar with this court’s unique features.

1. No Jury Trials

No jury trials are allowed in Land Court. If you file a case in this court, your matter gets decided solely by a judge. This, in my opinion, is a great feature of Land Court for certain cases, such as adverse possession, which are best suited for a judge to decide, and not a jury.

Another feature of Land Court are judges with expertise in Massachusetts property law. It is a safe bet that the judge you are appearing before has heard a case of this type before, and has a solid background on the applicable law.

2. Assigned Judges for Cases

In most Massachusetts state courts, judges sit in different sessions at different periods of time. It is not uncommon in Superior Court, for example, to have a case heard by multiple judges for the duration of the lawsuit.

In Land Court, a single judge is assigned to each case. A benefit of this is that the judge will have familiarity with the history of the case throughout the proceedings. This is a huge benefit for complex and detailed matters.

3. Early Case Management Conferences

Upon the filing of a case, the court schedules a case management conference. This is an opportunity to meet with the judge and opposing party and make a plan for the case. Many times, this initial hearing can help pave the way forward to resolving the dispute.

4. Servicemembers’ Cases

Servicemembers’ cases are typically brought in Land Court. These cases are to determine whether a party is in the active military service, which provides some protections against foreclosure and other legal proceedings.

Such proceedings are often confused with an actual foreclosure sale itself. These cases, however, are only a prerequisite to a foreclosure sale. Unless the homeowner is in the active military service, the homeowner generally does not have a defense to one of these matters. Nonetheless, a homeowner who receives one of these notices should be proactive about addressing the oncoming foreclosure against their home.

5. Jurisdiction Over Registered Land

Land Court has exclusive jurisdiction over registered land. Registered land is a unique form of public land record keeping that is certified by the state. Land records for registered land are generally organized by certificates of title on the public land registries.

Land Court certifies such land records, and authorizes whether changes may be allowed to the property’s title. If your case involves registered land, more often than not, a Land Court proceeding will be necessary.

Conclusion

If you need assistance with a real estate matter, contact me for a consultation.

Starting An Eviction in Massachusetts

The process for starting an eviction in Massachusetts generally requires the sending of a notice to quit and the proper filing of a court summons. The ins and outs of these two requirements are much more detailed than can be covered in a single blog post. The use of an experienced landlord-tenant attorney for an eviction is highly recommended.

Here, I want to focus on a few things that landlords can do on their own to assist with starting an eviction case against a tenant.

Address Any Condition Issues in the Rental Unit

Landlords have a responsibility for maintaining a rental unit. Prior to starting an eviction, a landlord needs to ensure that any health or safety issues in the rental unit are addressed. This needs to be done regardless of the reasons why the landlord wishes to evict a tenant.

Starting an eviction when there are unaddressed conditions in a rental unit can be problematic, and sometimes fatal to the case. Best to address these matters before an eviction case begins.

Gather Together All Documents Relevant to the Tenancy

In an eviction case, like any other civil action, tenants have the right to request discovery, which is information relevant to the claims and defenses raised in the case. These generally consist of written questions and document requests.

A landlord can make this process easier (and save themselves legal fees) by getting together this information in advance. A good resource for this are the sample discovery requests that tenants often use in Massachusetts eviction cases. Not every one of these requests, of course, will be relevant to every eviction case. These sample requests, however, can give landlords an idea of what information will be required as part of their eviction case.

Speak to An Attorney Before Accepting Rent During an Eviction

Landlords need to be careful about accepting rent during an eviction. In certain cases, accepting rent can reinstate a tenancy and delay an eviction. Accepting rent in such cases needs to be done in a specific manner, which an attorney can assist with.

Be Professional With Your Tenants and Manage Expectations

Even under the best circumstances, evictions can be stressful. Landlords, however, should always remain professional with tenants. While it may be tempting to express anger with a tenant during an eviction, rarely do such confrontations help in the long run. Assume everything you say or write to a tenant will go before a judge or jury. Often, it is a good idea to let your attorney be the one to speak directly with your tenants during such a case.

Landlords also need to manage their expectations for an eviction. Evicting a tenant will not happen overnight, and there are parts of the process that cannot be avoided. Educate yourself about the eviction process, and be realistic about your goals in one of these cases.

Conclusion

If you need assistance with a landlord-tenant matter, contact me for a consultation.

Requirement #3 for a Massachusetts Variance: Substantial Detriment

Massachusetts variance

This is a three part blog series on the requirements for obtaining a variance under Massachusetts zoning law.  The first post concerned the first variance criterion: a showing that the property has unique conditions. The second post discussed the requirement of hardship. This final post discusses the final requirement: that the variance will not substantially harm public good or substantially derogate from the bylaw’s purpose.

Overview

Obtaining a Massachusetts variance requires a showing of three distinct requirements; all of which a petitioner must satisfy:

[O]wing to circumstances relating to the soil conditions, shape, or topography of such land or structures and especially affecting such land or structures but not affecting generally the zoning district in which it is located, a literal enforcement of the provisions of the ordinance or by-law would involve substantial hardship, financial or otherwise, to the petitioner or appellant, and that desirable relief may be granted without substantial detriment to the public good and without nullifying or substantially derogating from the intent or purpose of such ordinance or by-law.

G.L. c. 40A, § 10

This third requirement requires consideration of how the requested variance fits in with the local community and zoning ordinances. Even if a petitioner meets the first two variance requirements, the permit granting authority has discretion to deny a variance under this third criterion.

Practical Implications for a Massachusetts Variance

Compared to the first two variance requirements, there are not as many court decisions interpreting this criterion. Generally, if a petitioner can make a good case for the first two requirements, they can generally meet this final criterion.

Nonetheless, a party seeking a Massachusetts variance should not ignore this last requirement. Rather, they should make a case that their variance is keeping with the purpose of the zoning ordinances, and will not cause harm to anyone else. Obtaining the written support of those who are living in the vicinity of the property can often be helpful in making such an argument.

Conclusion

If you need assistance with a zoning matter, contact me for a consultation.

How Can a Landlord Increase Rent?

Help With A Security Deposit

Massachusetts landlords need to act carefully when attempting to increase rent from tenants. With the exception of landlords who rent to tenants whose rent is subsidized by certain state and federal housing vouchers, there are no limitations on the amount of rent that a landlord may collect from a tenant. There is, however, a process that landlords must use to increase rent from existing tenants.

Tenants with a Lease

A lease is a formal agreement for the rental of property for a definitive period of time. Leases are legally binding agreements that obligate a landlord to rent the premises at the agreed-upon rent. As such, until the end of a lease, a landlord cannot demand an increase in rent.

A landlord, of course, can ask for an increase in rent after the lease, either through offering a tenants a new lease or a month-to-month tenancy. Landlords, however, need to be careful in these situations. If a tenant refuses to sign a new lease or agree to a month-to-month tenancy with the increase in rent, a landlord’s continued acceptance of rent after the end of the lease will create a month-to-month tenancy (known as a tenancy at will). The prior terms of the lease (including the monthly rent) will stay the same. Which brings us to the next topic . . .

Tenants At Will

For a tenancy at will, either party can end the tenancy by giving the other side a full rental period notice (which is most often thirty days). A landlord with tenants at will, therefore, can increase rent for these tenants by giving them proper notice of the rental increase.

There is a informal and formal way to do this. Informally, a landlord can simply ask the tenant to pay an increase in rent. If a tenant does, a new tenancy is created. If you go with this option, be sure to have the tenant sign a written agreement. While a tenancy at will can be oral, it is rarely ever a good idea.

If the tenant refuses a landlord’s offer to increase the rent, the prior month-to-month agreement (and prior rent) stays in place.

The formal way to increase rent is to end the month-to-month tenancy with a notice to quit, and offer a new month-to-month tenancy with the increased rent. This way, if the tenant refuses to accept the higher rent, the landlord has the option of evicting the tenant.

Practical Implications

Although a landlord can ask for higher rent from tenants, doing so is not always the prudent choice. Good, reliable tenants are a huge advantage to a landlord. Keep this in mind when choosing whether to pursue a rental increase. Many landlords find that modest increases in rent each year avoids the hassle of asking for a significant increase in rent in a single year.

Landlords also need to be mindful of state law that prohibits retaliation against tenants. Landlords cannot increase rent to “punish” a tenant for raising a complaint about the conditions of the apartment or filing a grievance with the town or city’s inspectional services department. Doing so exposes a landlord to liability from a tenant.

Conclusion

If you need assistance with a landlord-tenant matter, contact me for a consultation.

Sherwin Law Firm Wins Real Estate Appeal

real estate appeal

I’m pleased to write that I won a real estate appeal before the Massachusetts Appeals Court last week. This case concerned a real estate contract dispute, concerning rescission (a request to cancel a legal agreement). I had previously won the trial and the other side appealed. The full decision is included below.

What is an Appeal?

All civil disputes begin in a trial court, where a party can file a lawsuit against another party and seek monetary damages or a court order. Most real estate disputes in Massachusetts typically begin in the Superior Court or Land Court.

If a party is not happy with the outcome of a case, they can pursue an appeal. An appeal is a legal proceeding that asks a appellate court to review the decision of a trial court. Appeals generally go before the Appeals Court or District Court Appellate Division (depending on the case). In some cases, an appeal can go directly to the Supreme Judicial Court, the highest court in Massachusetts.

Lessons for a Real Estate Appeal

In this real estate appeal, I was defending the trial court decision (known as being the “appellee”). An advantage of being the winning party in an appeal is that an appellate court can uphold a trial court decision for any reason supported by the trial record. This means that, even if the lower court got the reasons for its decision incorrect, its decision will still be affirmed if there is another basis for the decision.

For this reason, a large portion of my argument addressed the many reasons why a claim of rescission was improper in this case. The purpose was to give the Appeals Court as many reasons as possible for going my way. I’m pleased that the Court agreed with my argument and affirmed the lower court decision.

Conclusion

If you need assistance with a real estate appeal, contact me for a consultation.

Decision

Breach of a Lease in Massachusetts

Breach of a Lease

This week, I obtained a successful judgment on behalf of several tenants against their landlord for a breach of a lease. This is an important topic for landlords and tenants that I want to discuss here.

What is a Lease?

A lease is a contract for the rental of property. A landlord agrees to allow a tenant to take possession of property for a specific period of time, in exchange for rent. Most residential leases in Massachusetts are for a year, but can be longer.

As stated above, a lease is a contract: a legally binding agreement. Failure to comply with one of the terms of a lease can result in a breach of this agreement, which has legal consequences.

Although a lease is a legally binding agreement, there are certain limitations that a landlord may not include. Massachusetts law prohibits the waiver of many landlord-tenant laws aimed at protecting tenants, such as the security deposit law. This is in contrast to a commercial lease, where landlords have much more flexibility in the rental terms offered to a tenant.

Breach of a Lease by Tenants

The most common type of a breach of a lease by tenants is the failure to pay rent. In such a case, a landlord can pursue an eviction, and seek possession of the rental unit and any owed rent. If the tenant is no longer in possession of the rental unit, the landlord can still seek owed rent through a civil action.

Tenants can also breach a lease by failing to comply with one of the other lease terms, such as keeping the property clean and not making excessive noise. If the breach is severe enough, this can also be grounds for eviction.

Breach of a Lease by Landlords

Landlords, importantly, can also violate a lease. In my recent case, the landlord failed to provide amenities in the apartment that it agreed to do, under a written lease. The Court agreed that the landlord’s failure to do so was a lease violation, and entitled my clients to monetary damages.

This is a critical lesson for landlords: a lease works both ways. Just as a tenant must comply with their end of the bargain, so must a landlord. Failure to do so can result in penalties if brought before a court.

Conclusion

If you need assistance with a breach of a lease, contact me for a consultation.

Landlords and Vacated Property

Landlords and Vacated Property

As a landlord-tenant attorney, my goal is to keep clients out of the dog house (pun intended). That’s why I want to discuss a new requirement for landlords and vacated property: checking for abandoned animals.

Landlords and Vacated Property

This law applies to landlords whose rental properties are vacated as a result of an eviction proceeding. It is fairly new, and is not yet included in the Commonwealth of Massachusetts’s eviction laws, found online. The full text of the law can be found in the passed law, and is included below:

Not more than 3 days after a property owner or a lessor knew or should have known that a property has been vacated as a result of summary process, the property owner, lessor or a designee shall inspect the property for the presence of abandoned animals.

If the property owner, lessor or a designee encounters an abandoned animal under this section or section 4, the property owner, lessor or a designee shall immediately notify an animal control officer as defined in section 136A of chapter 140, a police officer or other authorized agent of the presence and condition of the animal.

The property owner, lessor or designee who encounters an abandoned animal pursuant to this section shall not be considered the owner, possessor or person having the charge or custody of the animal under section 77 of chapter 272.

For the purposes of this section, an animal shall be considered abandoned if it is found on or in a property vacated as a result of summary process.

If the property owner, lessor or a designee fails to comply with this section, the lessor or property owner shall be subject to a civil penalty of not more than $500 for a first offense and not more than $1,000 for a second or subsequent offense. Funds collected under this section shall be deposited into the Homeless Animal Prevention and Care Fund established in section 35WW of chapter 10.

G.L. c. 239, § 14

This law, notably, only applies to vacated properties after an eviction (known as a “summary process” case). The law defines an abandoned animal as one that is “found on or in” a vacated property. This suggests that landlords should also report abandoned animals that are in the vicinity of their rental properties.

Practical Implications

From my years of representing landlords, I doubt this law will have a major impact for most owners of rental property. Generally, after an eviction, most landlords can’t wait to get into their rental units and check on their property.

Nonetheless, this is an important, new requirement for landlords and vacated property that should be kept in mind following an eviction.

Besides animals, it is a good idea for landlords with vacated property to take a close look at their rental units for other potential issues, such as health and safety concerns.

Stopping Foreclosure in Massachusetts

Options for stopping foreclosure in Massachusetts generally depend on what part of the process the homeowner is in. Depending on the circumstances, a homeowner may be able to avoid a foreclosure and work out a permanent solution for saving their property.

Massachusetts Foreclosure Process

Massachusetts is a non-judicial foreclosure state. This means that a mortgagee can foreclose without going to court. Foreclosure occurs through a series of required notices and a public foreclosure sale.

Homeowners often confuse a Servicemembers’ case as a scheduled foreclosure sale. A Servicemembers’ case, which is often filed in Land Court, is a court proceeding to determine whether the homeowner is in the military service (active military service provides some foreclosure defense protections). A Servicemembers’ case is not a foreclosure sale, but it is a sign that the mortgagee is moving forward with the foreclosure process.

Stopping Foreclosure Through a Loan Modification Application

The submission of a loan modification application to a lender will generally put the brakes on a foreclosure sale. This, however, generally only occurs the first time the homeowner applies for this assistance. A lender may delay a foreclosure sale if the homeowner applies again for a loan modification, but this is not a guarantee.

The timing of a submitted loan modification application is highly relevant for stopping foreclosure. If a mortgagee has already scheduled a foreclosure sale, it is less likely that it will stop a sale if the borrower submits an application. However, the submission of an application before the scheduling of a foreclosure sale has a greater chance of stopping foreclosure.

Stopping Foreclosure Through a Court Order

Stopping foreclosure can also occur through a court order, namely, an injunction. An injunction is a court order that requires or prohibits a party from doing something. A court can issue an injunction prohibiting a mortgagee from moving forward with a foreclosure sale.

A court order is often necessary when a mortgagee has already scheduled a foreclosure sale. To stop a foreclosure, a homeowner will need to show that the mortgagee failed to comply with one of the many foreclosure requirements. A homeowner may also be able to stop a foreclosure on grounds that the mortgagee is acting unfairly, such as performing a foreclosure sale when a loan modification application is pending or when the homeowner is trying to sell the home.

Conclusion

If you need assistance with stopping foreclosure in Massachusetts, contact me for a consultation.