THE SKINNY: The new moratorium law brings back the automatic eviction stay, until January 15, 2021, based a tenant’s self-certification. This time around, though, a landlord has the clear right to challenge the self-certification in court. The new law also creates a “nuisance” exception to the stay. A tenant applying for Emergency Rental Assistance Program (“ERAP”) benefits is also entitled to an automatic stay until her application is determined or January 15, 2021, whichever is later. However, there is no mechanism for a landlord to challenge an ERAP stay (which seems constitutionally suspect, but maybe that’s just me). Landlords should be on the lookout for ERAP applications as they are required to notify courts whenever a tenant being evicted applies for such benefits.
On September 2, 2021, New York enacted a new moratorium law barring most residential and commercial evictions and foreclosures until January 15, 2022 (the “Law”).
The Law, effectively, reimposes the protections of the Tenant Safe Harbor Act ("TSHA"), the COVID-19 Emergency Eviction and Foreclosure Prevention Act ("CEEFPA") and the COVID-19 Emergency Protect Our Small Businesses Act ("CEPOSBA"), as well as modifying the act which established the COVID-19 ERAP. Sadly, the Law does not outlaw statutory, alphabet soup abbreviations.
In extending the protections of the TSHA, CEEFPA and the CEPOSBA, New York modified the hardship declaration process to expressly allow landlords to challenge the validity of a tenant’s declaration in court by motion. However, until a court finds a declaration invalid, the new automatic stay created by the Law prevents any evictions or foreclosures from going forward.
The Law carves out a nuisance exception to the automatic stay allowing landlords to commence an eviction if a tenant:
Landlords must submit verified allegations supporting the existence of one of these nuisances. However, those allegations are not enough to establish the nuisance and lift the automatic stay. Courts are requiring hearings to determine whether there is a hardship or a nuisance.
The Law also:
The Law does not address whether a landlord may refuse to accept ERAP benefits and, instead, seek to evict. Nor does the Law provide any procedure for landlords to challenge a tenant’s self-certified eligibility for ERAP benefits, while the application is pending, and any eviction is automatically stayed. As such, the ERAP automatic stay seems questionable on the same due process grounds cited by the U.S. Supreme Court in enjoining New York’s previous eviction moratorium.
In Chrysafis, et al. v. Marks, Slip Op. No. 21A8 (August 12, 2021), the Supreme Court barred the operation of the prior moratorium because it allowed tenants to self-certify their financial hardship, and, on that basis alone, trigger an automatic eviction stay. The Court stated that this “generally precludes a landlord from contesting that certification and denies the landlord a hearing. This scheme violates the Court’s longstanding teaching that ordinarily no man can be a judge of his own case consistent with the due process clause”.
Allowing an automatically stay based on a tenant’s ERAP application would, in my opinion, do precisely the same thing: deny a landlord her day in court based on nothing more than a tenant’s self-certification. In Chrysafis the Supreme Court said that this was a “no-no”. I think the automatic ERAP stay may well be found to be equally naughty (in the constitutional sense, of course). This seems particularly so given the due process concerns implicated by automatically staying evictions, thereby denying landlords any option to deal with a non-paying tenant, to accommodate the snail-like pace of processing ERAP applications. (Indeed, these inordinate processing delays was one of the prime rationales for the Law and reimposing the automatic stay.)
While the costumes change almost daily, the landlord-tenant review rolls on (to little applause, at least from the landlords in the audience).
This article is intended to be used for informational purposes only. Legal advice is neither implied by the author nor should be inferred by the reader. If you have specific legal questions, you should consult with your attorney.
Jeffrey Sculley, who may be reached at firstname.lastname@example.org, is an attorney and counselor at law focusing his practice on representing commercial and residential landlords; providing backroom human resource and employment support to businesses and not-for-profits; representing clients in appealing adverse trial-court and administrative decisions; logo and brand development and trademark protection; and representing clients in all types of administrative, regulatory and compliance matters, before governmental agencies and administrative hearing officers and law judges.
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The moratoria are set to expire on May 1, 2021. These bills would extend those protections until August 31, 2021.