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What does the latest court ruling on the eviction moratorium mean for landlords in 2022?

January 4, 2022 | by Trevor M. Torcello
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A State Supreme Court Judge dismissed a lawsuit last month brought by a group of landlords challenging the eviction moratorium that remains in place in New York.
 
Following an earlier legal challenge of the moratorium, a mechanism was put into place for landlords to challenge the validity of a tenant’s hardship claim.
 
Justice E. Jeannette Ogden dismissed the case on the basis that the landlords had not gone through the process of challenging any of the hardship claims their tenants had filed.
 
We represent a large number of landlords, and the biggest challenge we see, is that the mechanism by which the tenant can declare a hardship doesn’t require any verification. If they simply complete a form and assert they are facing a hardship, that is enough to satisfy the law. There are two components to claiming a hardship, and both place a difficult burden on the landlord in the event of a challenge.
 
The first, is a financial hardship. It is 2022 and we are heading toward year three of a global pandemic. A case could be made that every renter in New York is facing some level of financial hardship. You may have a tenant who has a job, but that doesn’t mean their income is sufficient to meet their financial obligations, ergo they have a hardship.
 
The second condition is even broader. A person can claim a hardship if there is a person living in the property that has an increased vulnerability to COVID-19. While there are obviously very serious conditions that put a person at higher risk, there are also more catch-all options that a much larger number of tenants can count themselves under. Also, challenging such a claim in court would be a daunting task for a landlord.
 
This leaves landlords rightfully wondering, what’s next? With no sign of the eviction moratorium coming to an end, and COVID-19 numbers on the rise, it is anyone’s guess when New York landlords can expect to resume receiving rent payments from delinquent tenants.
 
So where does this leave landlords? Unfortunately, it leaves them in the same tough spot they spent much of 2020 and all of 2021. With a lot of uncertainty, and a limited number of options. A few things for landlords to remember:
 
It is still possible to evict certain tenants: If the landlord files an affidavit with the court attesting to the fact that a tenant is, “persistently and unreasonably engaging in behavior that substantially infringes on the use and enjoyment of other tenants or occupants or causes a substantial safety hazard to others” there may be a case for eviction, even with the moratorium in place. In such a case, it is advisable to have consistent, well-documented actions on the part of your tenant, not just one-off incidents.
 
There may be an opportunity to recoup some back rent: The Emergency Rental Assistance Program (ERAP) is the state and federally-funded, $2.7 billion initiative aimed at assisting tenants and landlords in New York. Though the program has received plenty of criticism, it still has limited funding available, with plans to pump in $300 million in additional funds in the works.
 
Landlords can still pursue a monetary judgement for back rent: Though you may not be able to evict a delinquent tenant, landlords can still pursue a judgement from the court to collect back rent owed. This is important because such a judgement may allow for the garnishment of wages to pay the debt. Additionally, these types of judgements are enforceable for 20 years. Even if your tenant may not have the means to pay now, once things return to normal you will have an established, enforceable judgement in place.
 
This too shall pass: A common concern we hear from our clients is that the eviction moratorium will never end, and if it does, they will be left holding the bag. To the first point, it will end. Gov. Hochul extended the ban on evictions until January 15, 2022. It may even be extended again, but it will eventually end. And when it does, they will have to be some meaningful relief available for landlords.

That could come in many forms, but there is too much at stake for the legislature not to enact a plan to address the fact that once landlords are able to evict tenants for non-payment of rent, they will need to recoup at least some of the two years of rent they have lost out on. It may be hard to hear as we inch toward year three of COVID-19, but the best course of action at this point may be patience.
 
Trevor M. Torcello is a shareholder of Gross Shuman P.C. who focuses his practice in the areas of commercial real estate, business transactions, agribusiness and working with emerging businesses. He has extensive experience representing various parties in complex business transactions. He can be reached at 716.854.4300 ext. 227 or ttorcello@gross-shuman.com.