Category Archives: 2017 Legislation

Summing Up the Session

The parking spaces around the Capitol are empty once more; the legislators have gone home. Which of the four bills concerning landlords and tenants were enacted? Let’s sum up.

Act 159 — Failure to Vacate
Supported by the Arkansas Realtors Association, this law revives the failure to vacate statute that three courts declared unconstitutional in 2015 and that about 25 Arkansas counties were already declining to enforce. The new act removes the most unconstitutional portions of the old law and restores it to its pre-2001 state. In that form, the Arkansas Supreme Court ruled it was constitutional, but the ruling was based on facts that are not true today (for example, the fact that tenants could present civil defenses, which the current law does not permit).

Here are the problems with Act 159. First, it does not give a judge the authority to actually evict a tenant. All the judge can do is fine the tenant between $1 and $25 each day the tenant remains on the premises. Thus, it will be perfectly lawful for a judge who finds a tenant guilty to fine the tenant $1 per day. Any eviction authorized under this statute will be an illegal eviction. The judge has no power to authorize the landlord to retake possession under this statute. Arkansas remains the only state to subject a tenant who essentially breaches a lease to criminal sanctions, with the potential for arrest, large criminal fines and jail time for nonpayment or failure to appear in court. We would not be surprised to see the new statute subjected to a lawsuit in the near future. Tenants, read the statute carefully. If you don’t pay your rent when it is due (even if it’s only a day late) this statute takes away the remainder of your lease term. If you then remain for more than ten days, under this statute you’re a criminal. Your landlord is benefiting from the free attorney services of a prosecuting attorney, but there’s no attorney for you. This statute subsidizes landlords at the expense of taxpayers and law enforcement services.

To repeat a comparison used elsewhere, it’s as though if, when you missed a mortgage payment, you immediately lost your ownership interest in your home and had to leave within ten days of when the bank sent you a notice. And if you weren’t out by then, you’d be hauled into criminal court and fined. This law is an embarrassment to the state of Arkansas. It would not be in our books were it not for the Arkansas Realtors Association and our legislature.

Senate Bill 600 — A Civil Eviction Procedure
Drafted late in the session by advocates for fair landlord-tenant laws, this bill would have given Arkansas a faster, simpler civil eviction procedure than the 19th-century unlawful detainer law currently on the books. It would give each party their day in court and would take place quickly, and would lessen a landlord’s need to hire an attorney. It did not make it out of committee. Do you know a realtor? Ask him or her why the Arkansas Realtors Association did not support this bill, and seems to be dead set against fair and balanced landlord-tenant laws in this state. Here’s a shout-out to the legislators who supported this bill.

House Bill 1166 — A Wolf in Sheep’s Clothing
This bill was supported by the Landlords Association of Arkansas. It was hard to tell whether the Arkansas Realtors Association supported it or not, as different people involved in advancing the legislation were getting conflicting information from the Association. HB1166 sailed through the House but ran aground in the Senate Insurance and Commerce Committee. This bill was a misrepresentation. Some of its proponents probably intended to  call it an implied warranty of habitability once it was enacted, but it was really, actually, nothing. It imposed very minimal requirements on landlords, with no consequences at all if the requirements were not met.  If a tenant complained and the landlord didn’t make the repair, the tenant could move out — that was the sole consequence. For several weeks, the bill even contained a provision that would harm tenants even more by denying them a right to damages that they currently have if certain conditions are met.

House Bill 2135 — A Real Implied Warranty of Habitability
This bill was the same as HB1486 from 2015, which was written in part by a landlord, and supported by the Landlords Association of Arkansas. It was introduced late in the session by advocates for fair landlord-tenant laws and died in committee.

It seems clear after this session that the most defiant obstacle to more fair and balanced landlord-tenant laws in Arkansas is the Arkansas Realtors Association. The Association seems not to care that our laws are a blot on Arkansas’s reputation because it is so out of line with other states.

 

 

 

Oppose HB1166! Update 3/6

House Bill 1166 filed by Rep. Laurie Rushing says that it creates “implied quality standards” for residential rental properties. Such standards come nowhere close to the bare minimum that all other states require. These standards also fall fall short of what good landlords routinely provide. So what’s missing? Here are just a few examples of the most glaring problems.

  • First, and most important, the bill does not require the rental property to be safe, structurally sound, or even livable.
  • The bill does not require landlords to comply with building and housing codes that materially affect health or safety.
  • The bill fails to provide for common areas to be kept safe and fit for use.
  • This bill only requires a landlord to supply heating and air conditioning if they worked at the beginning of the lease. This bill only requires landlords to supply electricity, water and sewage that complied with the code when they were installed. This bill only requires landlords to supply a “functioning roof and building envelope,” whatever that is.
  • This bill would do nothing to address problems such as a carbon monoxide leak, toxic black mold, broken door locks, or an infestation of rats or cockroaches.
  • A tenant’s sole remedy if a landlord doesn’t follow the law is to to ask for termination of the lease and move out. She cannot withhold rent to make repairs, seek damages from a court, make repairs and deduct them from the rent, or even ask a court to require the landlord to make repairs. All these other remedies are available to tenants in most states.
  • A landlord is free to retaliate against a tenant who complains to the landlord about the condition of the property or makes a report to housing code enforcement officials by increasing rent, decreasing services, or even evicting the tenant.
  • Oppose this bill! Contact your representative and ask him/her to oppose HB1166.

Cliff’s Notes for Landlord-Tenant Bills/Acts

Right now there are three landlord-tenant bills and one act, and activity is about to pick up.

You may recall that Arkansas enacted a criminal failure to vacate bill that is identical to the pre-2001 law. It is now Act 159.

In addition, Rep. Laurie Rushing has introduced a bill, HB1166, requiring “implied quality standards” of landlords. This bill sounds as though it will bring about more fairness, but it won’t. More information coming on the next post. This bill will come up Wednesday in the House Insurance and Commerce Committee. It will almost certainly pass, so its opponents will concentrate on the Senate. For now: read the post on 1166 to see why it is not a good idea.

SB600, introduced 3/3, and sponsored/cosponsored by Sen. Will Bond, Rep. Sarah Capp, and Rep. Warwick Sabin, is a streamlined, simplified, civil eviction bill that will make it easier for individual landlords and tenants to proceed pro se (without attorneys) and ensure both sides a hearing. This bill will create a fairer eviction procedure and will benefit both landlords and tenants!

HB2135, introduced 3/6, and sponsored/cosponsored by Reps. Greg Leding and Warwick Sabin, is an implied warranty of habitability that will provide habitable premises for tenants, give them remedies of lease termination or injunctions to force repairs, and prevent landlords from retaliating against tenants who exercise their rights. This, too, would be a significant improvement in Arkansas law.

A Civil Eviction Bill!

Please check out SB600, sponsored by Senator Will Bond and cosponsored by Representatives Capp and Sabin. The bill creates a streamlined civil eviction procedure, for possession only (landlords are free to sue in small claims court or circuit court for rent; most don’t). Landlords may only bring the action for nonpayment of rent–the grounds for virtually all evictions. Why is this bill so great?

First–It gives tenants the right to cure. If a tenant is late with rent the tenant has three days to pay. Neither the unlawful detainer statute nor the criminal failure to vacate statute give tenants a right to cure.

Second–These complaints can be filed either in circuit court or (if permission has been given by the Supreme Court) in district court. And the form of the complaint is so simple that no attorney will be needed (unless the landlord is an entity like an LLC).

Third–The bill requires the court to schedule the hearing within 21 days of the filing of the complaint. This is similar to the short time period of the current criminal failure to vacate statute and may be even faster in some cases.

Fourth–The tenant gets a real hearing! In an unlawful detainer action, if the tenant can’t understand the archaically-worded form and doesn’t respond, or doesn’t deposit the amount of rent the landlord claims is due into court, the tenant will be evicted. In a criminal failure to vacate hearing the tenant gets a hearing but usually has no right to tell her story, because all the judge asks is whether she has paid the rent and if not whether she is still on the premises. Unlike in unlawful detainer, the tenant can appear in court without having to file anything first.

One objection to unlawful detainer is that tenants could be billed for attorney’s fees. This will only be the case in this procedure if the tenant can’t prove they paid rent or doesn’t assert a defense–in other words, if the tenant is acting in bad faith.

This is a civil procedure, not a criminal one. If the tenant doesn’t appear, a default judgment will simply be issued, unlike in criminal failure to vacate where the judge will swear out a bench warrant, which will result in arrest. Any costs will be civil costs–they will not be criminal fines which carry severe consequences if they are not paid.

The new bill is fairer to both tenants and landlords. Once it has been assigned to a committee, we will post again.

SB25 is now Act 159

We take back our thanks to the governor for now! After being held in the governor’s office for a week, SB25 became Act 159 on Valentine’s Day. There is conflicting information as to whether the governor signed and we will update this post when we know. We would also include a link to the Act but it is not yet posted on the official General Assembly website, one week later after enactment.

We agree that Arkansas landlords need a quick, inexpensive eviction procedure. But it also needs to be fair. Act 150 is neither fair nor responsive to landlords’ needs. Let’s consider the act.

First, in a civil eviction proceeding, the judge issues an order evicting the tenant, and a writ of possession to law enforcement that authorizes it to physically remove a tenant and her belongings. Act 159 does not authorize a judge to issue an order of eviction, and the judge of a criminal proceeding doesn’t have any authority to evict anyone anyway. Act 150 does not authorize a judge to issue a writ of possession. Act 159 does not authorize a judge to permit the landlord to change the locks. Any  eviction of a tenant ordered by a judge under this act will be an illegal eviction.

Second, prosecutors and judges may still refuse to hear these cases. According to research carried out in 2012, 30% of Arkansas district courts did not hear failure to vacate cases. We will be surprised if those courts change what they are doing. If we were the judge and political pressure were brought to bear on us to enforce the law (because district court judges are elected), we would simply follow the letter of the statute–exactly what it says–and fine the tenant $1 per day. That adds up to a rent of $30 or $31 per month–not a bad deal! The statute calls for a fine of between $1 and $25 per day for every day the tenant remains on the premises. That is the only penalty allowed by the statute. Again, under this statute the judge has no authority to order the locks changed, the tenant to move out or a writ of possession to be served.

Third, in our opinion the law, declared unconstitutional in 2015 by three courts, is still unconstitutional even with the changes. Supporters of this bill argued (and the bill declares) that two courts declared it to be constitutional. Let’s look a little more closely at these two cases. The first one, Munson v. Gilliam, a 1976 federal Eighth Circuit Court of Appeals decision, ruled not on the constitutionality of the failure to vacate statute, but on whether an injunction could be justified. The question the court was answering was whether Little Rock could continue to prosecute failure to vacate cases while the statute was being litigated, or whether an injunction ordering the city to hold off would be enforced. The test in such a case was whether the tenants were likely to succeed, and whether failure to affirm the injunction would cause them irreparable harm. The court stated in what is called “dictum” its opinion that the statute was valid. But, and this is important, the prosecutor testified that landlords were “questioned extensively, under oath,” before a criminal information was prepared. That doesn’t happen in most courts today. The prosecutor or city attorney simply rubber-stamps what the landlord says. The court also said that tenants were allowed to raise civil defenses. That usually doesn’t happen either and even if it does, this law doesn’t allow it! The Munson court read words into the statute that aren’t there to reach its conclusion.

The later case, Duhon v. State, an Arkansas Supreme Court case, came right out and said that the Munson court did not declare the statute to be constitutional. Duhon repeats the same reason from Munson that a tenant can raise a civil defense and a court will hear it. Again, the statute doesn’t say that. Arkansas judges have been observed asking tenants only these two questions: are you still living there? And, have you paid the rent? The statute doesn’t allow the tenant to raise any other issues. A kind judge might allow this, but the statute does not. The law isn’t supposed to depend on kind judges to work.

The Arkansas Supreme Court has said that this law is in the public’s interest. Perhaps that was true thirty or forty or one hundred years ago, but it is not now. It is not in the public’s interest for landlords to be subsidized by taxpayers while tenants may end up victims of the criminal justice system for breaching a contract.

Despite the fact that one of this bill’s sponsors stated that this bill was not the best solution, and that a civil procedure would be better, none of the landlords’ groups has taken the time to draft one. However, a quick, inexpensive, fair civil procedure is in the works!  When we have more information we’ll post it.

On the Governor’s Desk–Feb. 9

SB 25, which preserves the crime of failure to vacate, is now on the governor’s desk. If signed, will it do all the Arkansas Realtors Association hopes it will do? We think not. Even before the existing law was declared unconstitutional, 1/3 of the counties did not permit landlords to file affidavits under this statute. It’s hard to believe they will reverse course. If signed, the law will not legally permit district court judges to order tenants to actually vacate premises. Therefore, any court-ordered evictions under this new law will be illegal. We may see more cases filed to set aside these illegal evictions. One judge has told us that if forced to hear these cases, he will fine tenants $1 per day and refuse to evict them or to allow landlords to change locks.  It may be that landlords don’t find their lives much easier than they were before.

What is needed? As lobbyists and attorneys for the Arkansas Realtors Association testified, if landlords sue under the current civil unlawful detainer statute, there is often a significant delay before cases are heard. Landlords must pay for the services of an attorney. If the tenant is found liable for unlawful detainer, the tenant will probably be saddled with significant court costs and attorney’s fees. On the other hand, the failure to vacate statute can cause a poor, down-on-her-luck tenant who fails to appear at the arraignment or fails to pay the fine to be hit with even larger criminal fines and even possible jail. And contrary to assertions of folks representing the Arkansas Realtors Association, numerous people have been jailed under the failure to vacate statute–records clearly show this. We guess these folks don’t write a letter to the realtors afterwards, and that’s why the realtors don’t know.

What is needed? A civil statute that allows tenants who have no money to pay to be evicted quickly, but allows tenants who have a legitimate complaint against the landlord their day in court. A civil statute that allows both parties to proceed without attorneys if they wish at the preliminary stages. Such a bill is being drafted now. Legislators paid lip service to the idea that a civil statute would be the best solution, but supported the failure to vacate statute because they said it was the only alternative available. What will they say when asked to sponsor or vote on a better civil statute? We’ll see.

In the meantime we see as in today’s  newspaper that the governor hasn’t yet signed the bill because he is reviewing the bill. Thank you, Governor Hutchinson. We hope you will ask why none of our legislators in the majority party are introducing a civil eviction bill. And we’re not even going to respond to Representative Laurie Rushing’s statement that “Arkansas is progressive” for being the only state that criminalizes failure to vacate. Her comment speaks for itself.

No Vote Yet, So Not Too Late–Feb. 7 the Day

The House did not get to landlord-tenant law today. We are told it was discussing blue and white lights on Christmas trees and the potential for confusion with law enforcement–but we’re sure that can’t be true.

SB 25 remains scheduled for a vote. The House convenes tomorrow at 1:30 according to the Meetings and Events Calendar. So, it’s not too late to contact your representative tonight!

An Email from the Realtors Association–and Our Response

Recently a realtor friend passed on this email to us. It’s true that not all realtors support the extreme anti-tenant position taken by the Arkansas Realtors Association. We have realtor friends who agree that Arkansas law is the most anti-tenant law in the United States. You may hear that the legislation proposed this session will correct this. It won’t. And we predict it will make life harder for landlords as well, because as it stands now, under the new failure to vacate statute a judge can’t even order a tenant to leave.

In the near future, we’ll write something for landlords. But for now, here is an email sent to all members of the Arkansas Realtors Association, the most powerful opponent of fair landlord-tenant laws in Arkansas. On Feb. 1 at the House committee hearing on SB 25, their counsel testified. Their lobbyist testified before the Senate committee last week. Our guess is they’ve spend thousands of dollars to deny tenants rights they have in every other state. Why? It’s a good question.

Word for word, this is the email in bold type. We’ve numbered the points. Our responses are in italics. Do you know any realtors? Are you a realtor yourself? Is your Association being candid about the state of the law, and what it is doing with your dues?

  1. The current single remedy eviction results from a Pulaski County court decision declaring a decades old statute unconstitutional.

Three circuit courts including Pulaski County have declared the failure to vacate statute, sought to be amended by SB 25, unconstitutional. Two have declared the entire statute to be unconstitutional, and one of the two held that it was unconstitutional in five different ways. In addition, more than 1/3 of state courts refuse to hear failure to vacate procedures. SB 25 seeks to amend this seriously flawed statute. A simplified civil remedy that is fair to both landlords and tenants makes sense over trying to revive and antiquated criminal statute that may still not pass judicial review and will leave landlords without a the best remedy for evicting violating tenants.

  1. Currently, landlords who have properties occupied by tenants that refuse to pay rent have only one available remedy, the civil eviction process.

The available civil process is the unlawful detainer statute, although some counties hear yet a third type of eviction case, found at Ark. Code Ann. 18-17-901 et seq. District courts do not have jurisdiction to hear this third type of case. Yet they continue to be heard. The point is, eviction law across the state of Arkansas is a mess. A streamlined civil procedure, fair to both landlords and tenants, is the only way to fix this. 

  1. These civil eviction actions must be filed in Circuit court, which have base filings fees of $150.00 per case, plus additional fees for service of process in most cases.

The base fee is actually $165 ($185 if an attorney is filing) and$35-$50 for service of process.

  1. Additionally, these civil eviction cases require some landlords to hire an attorney, an additional expense that will ultimately increase the cost of housing in Arkansas.

Correct. However, clogging the criminal justice system with landlord-tenant cases also inflicts a cost on taxpayers, and takes valuable time of prosecutors and judges who otherwise would be dealing with real crimes.

  1. Tenants who are in violation of the terms of their lease will have a civil judgment entered against them, and could have their wages and bank accounts garnished as a result of the action.

In fact, most tenants move out when the original notice is served, and so none of these outcomes come to pass. Most tenants are so poor that none of these outcomes would affect them in any meaningful way. And most landlords don’t pursue further measures anyway, once a tenant has left. But a criminal verdict can affect a tenant much more seriously. Failure to pay a criminal fine (which is what they would receive under SB 25) may lead to additional fines, court costs and restitution, and jail time. Criminal convictions may stay on a tenant’s record. 

  1. The municipal eviction process is much easier on both landlords and tenants. It is less costly and does not result in a civil judgment on the tenant’s record or the garnishment of their bank accounts and wages.  Most of the time, once the tenant is notified of the municipal eviction commencement suit they simply move out and the process stops, much easier on all parties.

First, let’s call this by its true name. It is a criminal procedure. Failure to pay rent on time by even one day, even only once, robs a tenant of her rental property—her place to live. She must move, and if the landlord gives her notice and she doesn’t, it’s a violation offense. A tenant who fails to make a criminal court date can be charged with Failure to Appear and be arrested. And the last sentence is misleading, because most of the time under the unlawful detainer statute, once the tenant is notified she simply moves out and the process stops.

 Why subject tenants to criminal charges, when no other state does this? Why rob the tenant of her place to live for one late rent payment? Nothing in the failure to vacate statute requires the landlord to accept a rent payment, even if it’s only one day late. There’s no “opportunity to cure” the breach of the lease.

The realtors’ explanation above, and the failure to vacate statute, assume the tenant is guilty. But to be fair and balanced, the law must protect the few tenants who are being taken advantage of by their landlord in the same way the law should protect landlords whose tenants who are taking advantage of them.

  1. Many landlords use their rental houses as a source of income. Failure to pay rent coupled with failure to vacate robs the landlord of his property.

This is true in every other state and yet in those states these actions are treated as a civil offense, breach of a lease, requiring a landlord to go to court to get a civil order requiring the tenant to leave. It is not “theft,” any more than paying a mortgage payment late is theft. Landlords should be encouraged to do a better job vetting tenants.  When the state is expected to pay for the cost of eviction, this provides landlords with no incentive to rent to responsible tenants.

Some landlords abuse the failure to vacate statute.  The way the process is set up, even if tenants are current on rent payments, or if the landlord has also violated the terms of the lease, the tenant does not get a chance to be heard.  

  1. It is in the best interests of the people of the State of Arkansas for property owners to continue to have remedies against tenants who fail to pay rent for a dwelling house or other building but refuse to surrender possession of the dwelling house or other building.

True, and the people already have a civil remedy (like every other state) in the unlawful detainer statute. Work is also in progress on a streamlined procedure that landlords and tenants can use without attorney assistance. It is not in the best interest of Arkansans to have a law that favors one group of people over another and treats tenants as though they are criminals.  The people of Arkansas deserve a law that gives everyone equal access to the courts an equal opportunity to present their case.  A law that treats breaching a civil contract as a crime does not do that. 

  1. Again, it is the intent of this legislation to amend Arkansas Code 18-16-101 so that the language is exactly the same as was previously in effect when 18-16-101 was upheld as constitutional in decision of the United States Circuit Court of Appeals, in Munson v. Gilliam, and the decision of the Arkansas Supreme Court in Duhon v. State.

Even if the law is passed and is taken back to the pre-2001 amendments, there is no guarantee that it will be found to be constitutional.  The law has evolved since the previous cases (Duhon and Munson) were decided. Munson did not hold the failure to vacate statute constitutional; it simply struck down an injunction. Duhon’s holding is based on different key facts. Failure to vacate cases are not tried the same way today in most courts.

Tell House to Vote NO on Senate Bill 25

Sample email:

RE: Please Vote NO on Senate Bill 25

Dear Representative ____________,

I am opposed to Senate Bill 25, which amends Arkansas’s failure to vacate statute.

If SB 25 is enacted, Arkansas will remain the only state to criminalize nonpayment of rent.  Our limited law enforcement resources should be used to fight crime, not to enforce civil contracts.  This statute effectively subsidizes landlords, who don’t have to hire attorneys to sue to evict. Taxpayers foot the bill for prosecuting attorneys who handle these cases. The bill causes a tenant who is just one day late with the rent to lose her housing, if her landlord wants her out and gives her a 10-day notice. If she doesn’t leave, she’s guilty of a criminal violation, resulting in a fine, and much more serious consequences if the fine is not paid. No other state has a law like this.

Civil contract disputes should be resolved by civil courts.  Arkansas already has a civil eviction law—the unlawful detainer statute—that allows a civil judge to issue a writ of possession.  For cases of nonpayment, a writ of possession can be ordered less than ten days from the date of the missed payment.  In contrast, a failure to vacate case cannot begin until at least eleven days after a missed payment.  Using civil courts for evictions is more efficient because the court can resolve all the issues between the landlord and tenant in one case. In a failure to vacate case, the tenant cannot raise any issues such as the landlord’s failure to keep promises.

SB 25 does not fix the problems with Arkansas’s eviction laws.  If enacted as written, SB 25 will likely face legal challenges that would leave Arkansas with a patchwork eviction system for another two years.  Two Arkansas judges have said that the existing failure to vacate statute is entirely unconstitutional.  Amending just one part of the statute will not fix this.  Adding a process for eviction to a criminal law may create new problems, because an eviction is not a criminal sanction.

I urge you to oppose this bill.  Thank you for your attention and consideration.

Very truly yours,
____________________