A Sublease Violation Costs Tenant it’s Lease; Court Allows Eviction

HNW Real Estate, Landlord/Tenant, and Zoning

Don’t assume knowledge of a violation of a lease provision will allow you to avoid eviction.  A recent NJ decision involving a commercial landlord and tenant is significant, in part, because it originates from the Appellate Division and therefore it is binding statewide.   The Court considered a judgment entered by the lower court for possession in favor of the landlord.   The lease specifically prohibited the tenant from assigning or subletting any portion of its space and the adjacent exterior parking space without the written consent of the landlord.   The landlord alleged that the tenant subleased part of its space to an unrelated third party business without its knowledge or consent.   The tenant alleged that the landlord knew that the third …

Foreclosing Bank Denied Legal Fees and Costs

HNW Real Estate, Landlord/Tenant, and Zoning

In a foreclosure, a plaintiff cannot recover counsel fees against a homeowner or borrower in foreclosure actions prior to filing the foreclosure complaint.   A recent decision has been rendered by the Appellate Division clarifying when a foreclosing plaintiff can recover counsel fees in a foreclosure action.   The New Jersey Appellate Division of the Superior Court ruled that the Fair Foreclosure Act which references the New Jersey Rules is a specific limitation on the amount of attorney’s fees a lender can recover.   New Jersey court rules bar the recovery of any amount of attorneys fees unless a Court rule expressly permits those fees.   It was clear to the Court that attorney’s fees to the lender are permitted only when the lender …

Landlord’s Beware: Commercial Tenant Failure to Obtain Municipal Permits Not Grounds For Eviction

HNW Real Estate, Landlord/Tenant, and Zoning

The New Jersey Appellate Division in an unpublished decision, Cesar S. Arredondo v. Nersy Pujols, Docket No. A-5459-05T25459-05T2, ruled that breaches of both of a lease provision and a New Jersey statute for failing to obtain municipal permits before commencing construction work were NOT grounds for evicting a commercial tenant.  Although very fact specific to a landlord with apparently “unclean hands”, this decision highlights pitfalls that can beset a landlord in the New Jersey eviction process. Cannot Evict for “Minor” Breaches (No Permits, No Insurance, Sidewalk Sales, Etc.) The Appellate Division agreed with the trial court on the insurance issue and the landlord’s inconsistent testimony.  However, the Appellate Division held that the breach was “not material” to warrant the tenant’s …

Tenant Filing for Bankruptcy? Take Action Now to Protect your Rent.

HNW Real Estate, Landlord/Tenant, and Zoning

Experienced, no nonsense attorneys for Landlords. Commercial Landlords: Four Important Questions to Ask When a Tenant Files for Bankruptcy With the recent downturn in the market, a number of commercial tenants are experiencing financial difficulties. In turn, this can lead to problems for commercial landlords, most importantly, the tenant staying current with lease payments. This may then lead to the tenant filing for bankruptcy protection. If your commercial tenant files for bankruptcy, it is wise to have a strategy in place to not only minimize the time of non-payment, but also maximize the ability to receive rents and damages allowed under the Bankruptcy Code.  Following are four (4) questions for commercial landlords to review with an attorney  whenever a commercial …

Landlord’s Beware: Commercial Tenant Failure to Obtain Municipal Permits Not Grounds For Eviction

HNW Real Estate, Landlord/Tenant, and Zoning

The New Jersey Appellate Division in an unpublished decision, Cesar S. Arredondo v. Nersy Pujols, Docket No. A-5459-05T25459-05T2, ruled that breaches of both of a lease provision and a New Jersey statute for failing to obtain municipal permits before commencing construction work were NOT grounds for evicting a commercial tenant.  Although very fact specific to a landlord with apparently “unclean hands”, this decision highlights pitfalls that can beset a landlord in the New Jersey eviction process. Cannot Evict for “Minor” Breaches (No Permits, No Insurance, Sidewalk Sales, Etc.) The Appellate Division agreed with the trial court on the insurance issue and the landlord’s inconsistent testimony.  However, the Appellate Division held that the breach was “not material” to warrant the tenant’s …

Grounds for Eviction

HNW Real Estate, Landlord/Tenant, and Zoning

When a landlord is seeking to terminate a residential tenancy, it is important to select the proper statutory grounds under which to proceed. Under no circumstances may a tenant be legally “evicted” without meeting a statutory prerequisite. Note that the statute may require that one or more notices be served upon the tenant prior to proceeding with court action. With the exception of a tenant’s non-payment of rent, or failure to pay rent after a reasonable increase (which requires a separate notice unto itself), a landlord is required to serve notice upon a tenant prior to the institution of court action. N.J.S.A. 2A:18-61.2 provides the notice requirements. I have set forth below the text of the statute that describes the …

Commercial Landlords: Four Important Questions to Ask When a Tenant Files for Bankruptcy

HNW Real Estate, Landlord/Tenant, and Zoning

With the recent downturn in the market, a number of commercial tenants are experiencing financial difficulties. In turn, this can lead to problems for commercial landlords, most importantly, the tenant staying current with lease payments. This may then lead to the tenant filing for bankruptcy protection. If your commercial tenant files for bankruptcy, it is wise to have a strategy in place to not only minimize the time of non-payment, but also maximize the ability to receive rents and damages allowed under the Bankruptcy Code.  Following are four (4) questions for commercial landlords to review with an attorney  whenever a commercial tenant files for bankruptcy protection: 1.    Have You Filed a Proof of Claim(s)?  As soon as the tenant/debtor files …

Short Sales When Loans Exceed the Value of a Home

HNW Real Estate, Landlord/Tenant, and Zoning

What is a short sale?  This is a term which is being used with increasing frequency in today’s real estate market. A short sale is when the proceeds from the sale of a home are not sufficient to fully pay off all outstanding debts which are secured by the property (mortgages) after first deducting the homeowner’s costs of selling the property.  In such instances, the selling homeowner can either bring funds to closing to make up the difference, or obtain approval from his mortgage holders to accept a reduced amount to satisfy his outstanding loans.  Unless a homeowner is able to pay off all of the mortgages which are secured by his property, the homeowner will not be able to …

As a Landlord, Here are 10 Things to Know When Going to Tenancy Court

HNW Real Estate, Landlord/Tenant, and Zoning

New Jersey law is very biased against Landlords.  One innocent mistake can be devastating to you financially. 1. When the Clerk or Judge calls the list of all matters scheduled, if the landlord is present in the courtroom and the tenant is not, the tenant will be “in default.” In that case, a judgment granting the landlord possession of the leased property may be entered against the tenant after the landlord has filed an affidavit proving a right to possession.  If the tenant is present in the courtroom and the landlord is not, the landlord’s complaint will be dismissed without prejudice, meaning it may be filed again without penalty. 2. In non-payment of rent cases, the tenant has the right to pay …

More Year End Tax Changes

HNW Real Estate, Landlord/Tenant, and Zoning

Besides cancellation-of-debt relief, the Mortgage Forgiveness Debt Relief Act of 2007 has other provisions that might prove helpful to you. More time for surviving spouses You can exclude $250,000 worth of gains from the sale of your home.  Married couples filing jointly get an even better break:  They can exclude up to $500,000 of gains as long as both spouses occupied the house as a principal residence for at least two years (730 days) of the five years preceding the sale. That sounds fine, but what if a hypothetical Beth Williams died in late 2007, and her widower Bob decides he wants to sell the big house in which they lived.  Under federal law, as an unmarried surviving spouse, Bob …