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Fair Housing Advocates Get Major Victory at U.S. Supreme Court

While everyone in America was focused on the U.S. Supreme Court’s historic marriage equality ruling, at the end of its Term, the Court also issued an important opinion under federal Fair Housing law.  In a 5-4 margin, the Court upheld the application of “disparate impact” theory of liability under the Fair Housing Act (“FHA”) in Texas Department of Housing & Community Affairs v. The Inclusive Communities Project, Inc

What is disparate impact theory you ask? Good question. In a disparate-impact claim, someone who alleges housing discrimination may establish liability, without proof of intentional discrimination, if an identified rental practice has a disproportionate effect on certain groups of individuals (i.e, minorities) and if the practice is not grounded in sound business considerations. Ok, now what does that mean in plain English?

Here’s an example. Let’s say you own several apartment buildings, and an upset tenant says that based on statistics for the last 5 years, you have evicted 75% more black tenants than white tenants, while the rate of nonpayment between racial classes have remain about the same. That’s a disparate impact claim. Surprising to most folks is that under a disparate impact theory, the claimant need not show some type of “smoking gun” evidence of direct racial discrimination, like something Donald Sterling would say, such as “we don’t like to rent to black folks.” If the claimant can back up his theory with statistical evidence, then he or she will have their day in court.

While accepting disparate impact as a viable Fair Housing claim, the Supreme Court imposed important limitations on the application of the theory “to protect potential defendants against abusive disparate-impact claims.” In particular, the Court held that a racial imbalance, without more, cannot sustain a claim, and directed lower courts to “examine with care” the claims at the pleadings stage. The Court emphasized the plaintiff’s burden to establish a “robust” causal connection between the challenged practice and the alleged disparities. Further, a defendant’s justification is “not contrary to the disparate-impact requirement, unless … artificial, arbitrary, and unnecessary.” Finally, “remedial orders” must “concentrate on the elimination of the offending practice” through “race-neutral means.”

Despite the limitation, this is a big win for fair housing advocates. Sec. 8 tenants, the MCAD and EEOC will have another powerful legal theory to use to crack down on discrimiminatory rental practices. Moreover, in the wake of the ruling, HUD just announced its the long-awaited Affirmatively Furthering Fair Housing (AFFH) rulewhich will provide maps and data on historic segregation that cities will need to use to assess their progress in reducing segregation, increasing housing choice and promoting inclusivity.

The lesson to take back from this ruling is to ensure you have policies in place to treat every applicant and tenant the same way across the board. The existence of written procedures, policies and manuals are helpful in defense of these types of claims. Saying you follow “Equal Housing Opportunity” is one thing; you have do actually do it.

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CFPB.pngCFPB Responds To Industry and Consumer Concerns On New Compliance Rules

The Consumer Financial Protection Bureau announced on Wednesday a proposal to delay the effective date of the TILA-RESPA Integrated Disclosure rule until Oct. 1. The rules were originally set to go into effect on Aug 1.

These new forms consolidate the TILA-RESPA and HUD-1 forms and are meant to give consumers more time to review the total costs of their mortgage. Of particular concern to the mortgage industry is the new rule’s requirement that the Closing Disclosure (new HUD-1) is due to borrowers three days before closing. These rules have thrown the mortgage industry into a frenzy as they try to comply by the deadline, and threatened to delay closings during the busy fall real estate market.

CFPB Director Richard Cordray said that “we further believe that the additional time included in the proposed effective date would better accommodate the interests of the many consumers and providers whose families will be busy with the transition to the new school year at that time.”

The required loan documentation consists of two new forms: the Loan Estimate and the Closing Disclosure to ensure compliance.

This is good news for the mortgage lenders and real estate conveyancers as we continue to work on achieving full compliance with the new forms and rules.

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Restricted-Access-Signs---Industrial-43894BBHPLYALU-baBy-Pass Housing Court For Expedited Superior Court Restraining Order Procedure

I recently handled an interesting case involving an unauthorized family member taking up residence in my client’s rental unit. My client, a doctor, owns a very nice condo unit in the Theatre District in Boston. He and his family live next door in the adjacent unit. The client signed a one year lease with a wealthy foreign national from Jordan, a middle aged lady. Per the lease, the tenant was the only authorized occupant for this 1BR unit. There was no discussion about family members being authorized occupants, and my client would not have agreed to it.

My client comes to find out that the tenant’s 20-something year old son, who attends a local college, has taken up residence in the unit. To make matters worse, the kid hosts several loud late night parties reeking of marijuana and cigarette smoke. My client is incensed, and to add insult to injury, he is fined several thousand dollars for noise and lease violations by the condo association. My client attempts to take action against tenant and son, but they hire a well known tenant’s rights attorney who stonewalls the two attorneys hired by the client. The client finally hires me.

Typically, this type of case would be filed as a standard eviction case in busy pro-tenant Boston Housing Court. The tenant’s attorney is also well known there. Accordingly, I needed to find a way to bypass Housing Court and take away this lawyer’s home court advantage.

So I came up with an creative approach. I filed a restraining order application in Superior Court to remove the son as an illegal trespasser. Although Superior Court typically handles major civil cases, it does share jurisdiction with the Housing Court over trespass cases requesting equitable relief. I served the interloper with a formal trespass notice, then filed the Superior Court application a few days later. The judge granted the move out order, after which my client and I had the pleasure of taking a victory walk down Tremont Street to serve the move out order. We were able to have the management company immediately change the locks and remove all the kid’s possessions. He is now permanently barred from entering the building. And the best part was that he left his wallet and passport in the unit! My client is now preparing the unit for rent to a better tenant. 

As the saying goes, “possession is 9/10ths of the law”!!!

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Tax-Information-about-Employees-and-Contractors-3SJC Issues Long Awaited Ruling That Agents Can Be Classified as Both Independent Contractors and Employees, But Leaves Questions

The Supreme Judicial Court has just released its long awaited opinion in Monell, et al. v. Boston Pads, LLC, (link here), ruling that Massachusetts real estate and rental agents can remain classified as independent contractors under the state’s real estate licensing and independent contractor law. The ruling keeps the traditional commission-only independent contractor brokerage office model in place, with brokers allowed to classify agents as 1099 independent contractors, without facing liability for not paying them salary, overtime or providing employee benefits. A collective deep breath should be heard throughout the entire Mass. real estate industry this morning.

Although the ruling determined that real estate agents are exempted from Massachusetts’s independent contractor law, the Court left open whether future plaintiff employees could build a case on other legal theories, and the Court deferred to the Legislature to enact a bill to address any murkiness which remains with the law.

Despite the question left behind by the justices, Gregory Vasil, CEO of the Greater Boston Real Estate Board told Banker and Tradesman said that, “We’re pleased with the outcome.” “It preserves the right of choice for our members. It doesn’t change the industry, it doesn’t change the status quo. It’s pretty clear you can have both independent contractors and employees.”

Corrine Fitzgerald, 2015 president of the Massachusetts Association of Realtors and broker-owner of Fitzgerald Real Estate in Greenfield, agreed, calling it a “good decision.”

Rental Agents Sue Jacob Realty For Overtime Wages

This lawsuit was brought by a group of disgruntled rental agents at Jacob Realty seeking to recoup lost overtime and minimum wages. As is customary in the industry, Jacob Realty classified the agents as independent contractors, paying them on a commission-only basis and making them responsible for payment of their own taxes and monthly desk fees. At the start of their employment, however, the agents signed non-disclosure, non-solicitation and non-compete agreements. They had to own day planners, obtain a cellphone with a “617” area code, adhere to a dress code, submit to mandatory office hours and to various disciplinary actions if they did not meet their productivity goals — requirements typically reserved for employees, not independent contractors.

Court Holds That Agents Can Be Classified Either as Independent Contractors or Employees

The SJC was tasked with balancing the independent contractor laws and the real estate licensing law — which in many critical aspects the Legislature left directly in conflict with each other. Justice Hines, writing for the Court, noted the difficulty in construing the two laws, stating that “the real estate licensing statute makes it impossible for a real estate salesperson to satisfy the three factors required to achieve independent contractor status, all of which must be satisfied to defeat the presumption of employee status.”

The Court ultimately concluded that a real estate agent could be classified as either an independent contractor or an employee, but that the agents at Jacob Realty were unable to demonstrate they were employees in this particular case. The Court, however left open for another case the ultimate questions as to whether all real estate agents should be classified as independent contractors. The justices said that “in light of the potential impact of that issue on the real estate industry as a whole and its significant ramifications for real estate salespersons’ access to the rights and benefits of employment, we think it prudent to leave that issue’s resolution to another day, when it has been fully briefed and argued. Should the Legislature be so inclined, it may wish to clarify how a real estate salesperson may gain employee status under the real estate licensing statute.”

This ruling is somewhat frustrating. The SJC punted on the major question that everyone in the industry has been waiting on for a year now. I love when that happens (insert sarcasm here). Whether the Legislature takes up this issue remains to be seen. In the meantime, brokers and office managers can sleep a little better tonight knowing that the chances they will be sued over employee classification has gone down considerably, but they still may be awoken someday with a nightmare in the hands of a creative plaintiff’s wage and hour attorney.

 

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gill08900Court Halts Eviction For Distressed Homeowner, Validity of Foreclosure In Question (Wells Fargo v. Cook, Mass. Appeals Court May 19, 2015)

In response to the foreclosure crisis, HUD enacted regulations requiring lenders to provide distressed borrowers with a meaningful opportunity to settle their FHA-insured mortgages and obtain a loan modification during a face-to-face interview. In an effort to accommodate the hundreds of Wells Fargo clients facing foreclosure in Massachusetts, the San Francisco based lender held a mass “homeowner’s workshop” at Gillette Stadium in August 2008.

Three months behind on their Mattapan mortgage, Nancy Cook and her daughter showed up to the stadium with a little over $10,000 in cash, in anticipation of signing a repayment plan. After waiting in a long line, Cook received a ticket and sat down with a bank representative. Despite HUD guidelines requiring that loan representative have actual authority to settle accounts and enter repayment plans, the Wells Fargo representative said that he was unable to accept any payments at the event. The counseling session lasted only 15 minutes, but the reprepresentative promised that Ms. Cook would receive a loan modification package in the mail.

Ms. Cook did receive a Special Forbearance Agreement in the mail, which she accepted, and made the first three payments under the agreement. When she went to make the fourth payment, Wells Fargo rejected it, claiming that Cook owed it $2000 more than the scheduled payment. Wells Fargo then issued a default notice, accelerated Cook’s debt, and foreclosed her home.

Several years after completing the foreclosure sale, Wells Fargo brought an eviction case against Cook and her daughter, who at this time were represented by lawyers from Harvard University Legal Aid. (The reason for the long delay is unclear). Boston Housing Court judge Marylou Muirhead ruled against Cook, clearing the way for her eviction.

On appeal, Appeals Court Justice Scott Kafker halted Cook’s eviction, ruling that the Housing Court judge should reconsider whether the Gillette Stadium mass counseling event complied with HUD guidelines. Justice Kafker noted that a reoccurring theme of the HUD rules is to provide personalized consideration for each homeowner. That apparently was not done, said the justice, or at least there is a dispute as to whether the mass Gillette Stadium event could satisfy that guideline.

Of particularly interest to the real estate conveyancing community, the Court held that if the lower court ultimately rules that the counseling session was insufficient, the lender could be found in noncompliance with the mortgage terms and foreclosure power of sale, and its foreclosure could be deemed defective and invalid. A court holding to this effect could potentially invalidate completed foreclosures of FHA insured mortgages over whether the lenders complied with the face-to-face meeting requirements of the HUD guidelines. Ensuring a lender’s compliance with HUD rules is not typically part of a title examiner’s scope of examination. Lenders would need to provide an affidavit certifying that all pre-foreclosure counseling requirements were complied with. Accordingly, this is yet another reason why obtaining an owner’s title insurance policy is a prudent choice for all buyers of foreclosed properties.

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MRHAI am honored to be one of four fantastic speakers at the Massachusetts Rental Housing Association (MRHA) Annual Meeting and Conference on Saturday, May 30, 9AM-1PM at the Embassy Suites, 550 Winter Street, Waltham, MA.

My presentation will be “War Stories from the Eviction Court Trenches.” I will retell some colorful stories from my career handling over 5,000 evictions throughout the Commonwealth, as well as talk about my thoughts for fixing the system going forward.

Other speakers include:

Jamie Williamson, Commissioner, Massachusetts Commission on Discrimination(MCAD)Fair Housing Laws and How to Avoid Lawsuits

We have all heard of the large penalties inflicted upon unsuspecting landlords who are not aware of fair housing  laws, protected classes of people and discrimination red flags. Ms. Williamson is a Commissioner of the Massachusetts Commission on Discrimination(MCAD) and her presentation is not to be missed.

Marcus Papajohn, Financial Planner, www.MarcusPapajohn.comThe Good, the Bad and the Ugly, Estate Planning for Landlords 

How do you plan your estate of  income properties? Whether your properties total $200,000 or $2,000,000, whether you are  25 years old or 52 years old or 82 years old, whether you have children or not, you are wise to have an estate plan. Mr. Papajohn is a financial planner who has worked with MRHA for many years.

Mark Leger, MRHA Legislative Chair

Do you charge late fees? Have you had the “free rent” trick played on you? If “survivors of domestic abuse” become a protected class, will you be able to evict them? Mr. Leger explains landlord bills before the Massachusetts legislature that will effect the way you conduct your rental property business.

Click here to Register for the Conference. 

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cls-6State House Hearing Set For May 12, 1pm, Joint Committee for Judiciary Hearing Room A-2 

For the last decade, Massachusetts landlords have been lobbying for a tenant rent escrow bill which would prevent tenants from using the infamous “free rent trick” in evictions. The free rent trick works like this:  Tenant stops paying rent for various reasons, such as economic hardship or by design. After receiving a 14 day notice to quit for non-payment of rent, the tenant will immediately call the board of health to get the owner cited for minor or cosmetic code violations such as a hole in a window screen. Under current Massachusetts law, any code violation cited, however minor, allows the tenant to withhold rent until the eviction case is resolved. What usually happens is that the tenant skips out of town or agrees to a move out but never pays the months of accrued unpaid rent, leaving the landlord stuck with thousands of lost income to pay their mortgage and expenses.

Even the liberal Boston Globe recently published a compelling piece on how the Massachusetts legal system unfairly penalizes small landlords in these situations.

Unlike most other states, there is no requirement in Massachusetts that the tenant post the withheld rent into some form of escrow account. There have been many instances where tenants have intentionally inflicted property damage to claim code violations or just made them up altogether.

Bill Would Level Playing Field Between Small Landlords and Tenants

Hopefully, this will finally be the year that the Legislature passes this much needed reform to curb tenant abuses of the eviction process. Three bills will be discussed, H.B. 1654H.B. 1663 and H.B. 1664. Landlords are urged to come and testify before the committee and otherwise support the bill by contacting their local representatives and senators.

A mandatory rent escrow law would require any tenant who exercises their right of rent withholding to pay the withheld rent into an escrow account until the unsafe conditions or code violations are repaired. After repairs are done, either the landlord and tenant agree on how the escrowed rent should be divided, or a judge orders a fair settlement. In most cases, the owner will get back most of the withheld escrowed rent. But the most important impact of a mandatory rent escrow law is that those nonpaying tenants who do not escrow can be promptly evicted for nonpayment of rent. Although nonpayment evictions will still take on average three months to resolve, much-longer-delayed evictions and the free rent trick will be stopped.

The bills will most benefit small landlords and owners-occupants of multi-family residences who rent out apartments. These property owners are typically on strict budgets, and any lost rent and attorneys’  fees will prevent them from paying their mortgages, real estate taxes and property expenses, potentially leading to default and foreclosure.

For more information on how you can support these bills, please contact the Massachusetts Rental Housing Association and the Massachusetts Small Property Owner’s Association.

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100316_photo_vetstein (2)-1Richard D. Vetstein, Esq. is a vocal advocate for Massachusetts landlord rights and can be reached at rvetstein@vetsteinlawgroup.com or 508-620-5352.

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Superman's_classic_poseLike Superman, A Use and Occupancy Agreement Can Save the Day, But Be Aware of the Risks!

Tom and Mary Ryan, and their two little kids, Abigail and Jake, are relocating from California to the Boston area so Tom can take a job with a local tech company in Burlington. They have already sold their California home, and have been living in a cramped rented condominium in Santa Monica for two months already. Their loan has hit some snags because Tom was out of work for half of 2013, and had some IRS issues, although he is on solid footing now with his new job. The closing is scheduled for the end of this week and they have their cross country movers booked and scheduled and their life is now packed in boxes. Just when they finish packing their last box, their loan officer calls with somber news. “Tom, unfortunately, our underwriting department is dealing with delays getting your tax transcripts from the IRS. We are going to have to push back the closing for about a week. I’m so sorry.” Canceling the movers will cost several thousand dollars, and they will have to cancel furniture shipments as well. To make matters worse, new tenants are supposed to move into Tom’s rented condo unit right after they leave.

While all characters appearing in this work are fictitious, and any resemblance to real persons, living or dead, is purely coincidental, Tom and Mary are in trouble. With the prevalence of back-to-back closings and unforeseen underwriting issues and title defects, these situations are not uncommon. And with new TRID closing disclosure rules coming online in August, which are bound to cause even more loan approval delays, we may be seeing more of these situations in the months to come.

Fortunately, there is a solution to this situation. The sellers are willing to let the Tom, Mary and family move into the home prior to the closing under a Use and Occupancy Agreement. This will enable the buyers to complete their move, move into the house, but before the actual closing. A use and occupancy agreement, however, is not without its risks and downside, which I will discuss below.

One of the most important aspects of a Use and Occupancy Agreement is what it is versus what it is not. The agreement should specify that it creates a mere license to occupy the premises, not a tenancy or a landlord-tenant relationship. This will make it easier to remove/evict the occupants if something goes wrong. In any event, if the sellers are forced to remove the occupants, they will still have to resort to judicial eviction proceedings, which in Massachusetts can potentially take several months. This alone is the biggest drawback of a Use and Occupancy Agreement. The seller should always put language in the agreement that the buyers will be responsible for all attorneys’ fees and costs in case of an eviction.

The parties have to agree on a rental rate, typically based on the fair market rent for the premises or the mortgage and carrying costs. Websites such as www.rentometer.com can give you an idea of what a fair rental rate should be. Your Realtor should give you guidance as well. The rent should be divided by 30 for a per diem basis. You can also charge penalty rent if the term is extended past the original deadline.

The sellers should also include general indemnification language providing that “during the period of occupancy, Buyers shall maintain the Premises in good, clean condition and shall not make nor suffer any strip or waste to the Premises, nor make nor suffer any unlawful or improper use of the Premises and Buyers agree to indemnify Sellers and save them harmless from all liability, loss or any damage arising from such additions, alterations, strip, waste or unlawful or improper use, any nuisance made or suffered on the Premises by Buyers, including their family, friends, relatives, invitees, visitors, agents, or servants, or from any carelessness, negligence or improper conduct of any person.”

Lastly, the buyers should do their pre-closing walk through before they move in under a Use and Occupancy, because once they move in, the home will be a mess for awhile. That way, everyone will be on the same page as far as the property condition goes on the date of move in.

Many attorneys advise clients never to agree to Use and Occupancy Agreements. I am not one of those attorneys. With any risk, it depends on the situation. The sellers need to be comfortable that any delays will be resolved favorably and quickly. Sellers also need to appreciate that despite any language in the agreement, it could take months to remove an occupant if things so south. As long as everyone understands the risks, a Use and Occupancy Agreement can be a life saver.

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10981956_10153123954712492_3979037511274380989_nReal estate professionals, you are cordially invited to a fabulous night of pampering at Metrowest’s hottest style salon, Beauty Parlr! Attendees will enjoy complimentary blow-outs by professional hair stylists, including Moroccan oil treatment, head massage and your choice of style.

Date: April 30, 2015
Time: 4pm-7pm
Venue: Beauty Parlr, 1 Watson Place, Building 3 Floor 3, Framingham, MA 01701

Wine, cosmos, cheese and nibbles will be provided, along with the latest in jewelry fashions for spring and summer. This event has limited space, so please RSVP to rvetstein@vetsteinlawgroup.com.

Due to limited space, you must reserve a blow-out appointment in advance: Please call Beauty PaRLR at 508-202-9538 or email info@beautyparlr.com. Limited space available, first come first serve basis.

A professional photographer will also be available for head shots (additional fee).

Sponsored by Attorney Richard Vetstein of the Vetstein Law Group, P.C.Bryan Brown of Guaranteed Rate, and Matt Naimoli and Zack Gould of G&N Insurance.

We hope to see you there!

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917BdkbVovL._UX250_Elizabeth Gerhman, a writer for the Boston Globe Magazine and owner of two rental units, is fed up with how the Massachusetts legal system favors tenants over landlords.

In her article Think It’s Tough to Rent? Try Being a Landlord, she describes that

“In just five years as a rental, the other [unit] — which has hardwood floors, granite countertops, and a $1,200 dishwasher — has been a nightmare, with tenants who bounced checks, didn’t pay their rent, and threatened to call the building inspector over, among other things, a loose toilet seat, a missing outlet cover, and, I’m not kidding, a bedroom that is allegedly 0.389 of an inch too small. The tenant who detailed these horrific, slum-like conditions also threatened to take me to court over some food that had spoiled when the refrigerator broke — which is what prompted the intimidation tactics in the first place.”

As landlord groups have been arguing for years, one of the major problems with the current system is that Massachusetts has no rent escrow law. Under the present system, a tenant can withhold months of rent for any cosmetic or minor problem with the unit until the eviction case is resolved, leaving the landlord unable to pay their mortgage. We call that the “free rent trick.” As Ms. Gerhman correctly points out, “with an average judgment of about three months’ rent, this can be a real hardship for house-poor landlords. And once a landlord does evict a tenant who owes back rent, he or she must pay to move the tenant’s belongings out of the apartment in addition to three months’ storage costs.” As I was quoted in the article, many landlords opt for “cash for keys” deals to avoid huge losses during an eviction.

A rent escrow law would require any tenant who withholds rent to simply pay it into an escrow account until the unsafe conditions or code violations are repaired and the eviction case is resolved. After repairs are done, either the landlord and tenant agree on how the escrowed rent should be divided, or a judge orders a fair settlement. The “free rent trick” would be gone and landlords less likely to get left holding the money bag.

Sounds fair? Tell that to your state legislators who have been sitting on rent escrow bills for over a decade.

New rent escrow bills return to the Legislature this session as House Bill 1654 sponsored by Rep. Chris Walsh and House Bill 1112 sponsored by Rep. Brad Jones. Both bills are expected to get hearings at the State House this spring. I will keep you posted.

Personally, I think a fair legislative compromise would be for landlord groups to support the Housing Court Expansion bill under the condition that a Rent Escrow Bill is passed along with it. That would be a win-win for both sides.

In the meantime, please email and call your local state rep and senator and tell him or her you are in favor of these bills. If you have any tenant horror stories, make sure you include those as well. Also, consider joining your local chapter of the Massachusetts Rental Housing Association or Masslandlords.net. Both organizations will be coordinating legislative efforts on the rent escrow bill and other landlord legislation. Lastly, please share this article and the Globe Magazine article on your Facebook pages, Twitter feeds and email blasts!

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Foreclosure2.jpgAbate v. Fremont Investment & Loan:  High Court Rules That “Try Title” Procedure Only Available After Foreclosure Auction Completed

After Deutsche Bank foreclosed his Newton home, Thomas Abate brought a lawsuit in the Land Court challenging the foreclosure under the “try title” procedure under General Laws chapter 240, sections 1-5. Seeking to invalidate the foreclosure, Mr. Abate utilized the popular defense of attacking the assignment of his mortgage from MERS (Mortgage Electronic Registration System) to Deutsche Bank. After several months of legal wrangling in the Land Court, Judge Robert Foster dismissed Abate’s challenges to the MERS assignment, and dismissed his try title claim. Abate then appealed to the SJC.

Prior to the SJC’s ruling, there was confusion in the foreclosure setting regarding the proper method to determine whether the property owner had legal standing to bring a try title case and whether the owner must bring the case before or after the foreclosure. Putting the proverbial nail in this particular foreclosure defense coffin, the SJC held that a borrower can only use the try title procedure after a foreclosure has been concluded, not before. The Court also ruled that lenders can seek to test borrowers’ legal theories and dismiss these claims very early in the proceeding on a motion to dismiss. The net result is a blow to foreclosure challengers — borrowers must wait until after a foreclosure is completed to bring a lawsuit; and it will be easier for lenders to dismiss claims challenging mortgage assignments and the foreclosures based on such assignments.

I asked preeminant foreclosure defense Attorney Glenn Russell for his thoughts on the ruling, and he said this:

Well from a homeowner’s perspective I have to say that I was hoping for a different outcome, however it’s not all bad. Bottom line, borrowers cannot use try title unless the auction happened, or they can make argument that there never was a legally valid mortgage, or one is trying to enforce a void mortgage, or one that has been discharged. The key thing is that a homeowner cannot bring a try title claim (standing under the “first step” of the try title action), unless the mortgage is foreclosed.

So after several key rulings in favor of foreclosure victims in the earlier part of the decade such as the seminal U.S. Bank v. Ibanez case, the SJC has issued several pro-lender decisions of recent vintage. Is this a sign of foreclosure fatigue or are the justices merely following the law? Maybe a bit of both…

With the economy improving as well, the net effect is likely to be less foreclosures and less legal challenges to them — which will only continue to boost an improving housing market.

A link to the Abate v. Fremont Investment & Loan (SJC-11638) opinion can be found here.

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NickCLRAttorney General’s Office Accused of Smearing Local Landlords In Press

A Craigslist rental ad posted online for merely 8 days turned into a complete nightmare for a Melrose father and son who claim that Attorney General Martha Coakley’s office ran roughshod over their rights and tried to smear their reputations in the local newspapers. After a five year legal saga, the landlords, Nicholas Keramaris (pictured right) and George Keramaris, fought back and won, convincing the Appeals Court to overturn a $38,000 civil penalty and attorneys’ fees assessed against them.

“Apartment Is Not De-Leaded”

The Keramaris family trust owns a 20 unit apartment building in Melrose. All of the units originally contained lead paint, and five of the apartments have been deleaded. One of the leaded units became available for rent, and Nicholas Keramaris, who is also an attorney, researched the lead paint laws prior to posting an advertisement on Craigslist stating “Note that this apartment is not de-leaded, and therefore it cannot be rented to families with children under six years old.”

A Melrose mother, who did not have a child under six and who did not attempt to rent the advertised apartment, filed a complaint with the MCAD about the ad. (This could have been a dummy renter employed to find fair housing violations). Once the landlords were notified of the complaint, they took the ad off Craigslist. It ran for a grand total of 8 days.

1379349493000-martha-coakleyAG’s Office Steps In

Attorney General Martha Coakley’s Office then stepped in and filed a civil action for discriminatory rental practices, seeking penalties and damages under the state Consumer Protection Act, Chapter 93A. According to the Keramaris family, “from the day that the Assistant Attorney General assumed responsibility over the case, he insisted on collection of steep penalties as a condition for settlement. Also, the Attorney General’s office publicly smeared us through repeated press releases while the case was pending. Our request for the Attorney General’s office to stop issuing negative press releases was described as a “non-starter” for settlement negotiations. Therefore, this very simple case, which involved a relatively benign violation, dragged on for almost five years.”

Award Struck Down

Despite the fact that the ad ran for only 8 days and no one was actually harmed, the Attorney General was able to persuade a Superior Court judge to assess an aware of nearly $38,000 in penalties and attorneys’ fees. Unwilling to accept this unjust result, the Keramaris family appealed and got the justice they deserved.

Employing some well needed common sense, the three judge appellate panel concluded that although the ad technically violated the lead paint discrimination statute, any harm done was minimal and did not rise to the egregious level of a Consumer Protection Act violation. In a rare ruling, the judges ruled that the lower court abused its discretion, finding that this was nothing but a good faith mistake by landlords who were not intentionally setting out to violate the law. The Appeals Court ultimately stuck down the entire award, leaving the Keramaris family with justice, albeit after 5 long years and I’m sure thousands in legal fees.

Where’s the Discretion?

I have handled numerous rental discrimination cases involving the Attorney General’s Office. The one thing I can say is that they often have a very one sided view of cases and suffer from tunnel vision. They also hardly ever exercise their discretion to back down. It’s usually all or nothing. I would like to see them try to see both sides of the coin in future cases and be more open to negotiated settlements. Maybe this ruling will encourage that. I won’t hold my breath though.

And lastly, I’m curious if the Attorney General will issue a press release announcing that the Appeals Court overturned this award? I doubt it.

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Vetstein Guest CardI was delighted to talk about recent legal issues surrounding home improvement contractors, including my best tips on selecting a contractor, on the Real Estate Radio Boston show hosted by Mortgage Banker Rick Scherer and Attorney Ali Alavi. Just click the Play button below to listen!

Tune into the show every Saturday night from 8pm-9pm on WBZ 1030 AM. They also have podcasts on the link above. It’s a fantastic show with very knowledgeable guests, and of course, great hosts in Rick and Ali.

This Saturday night it’s “Can’t Miss Radio” with Stan Humphries, the Chief Economist for Zillow. Tune in Saturday night 8pm on WBZ AM 1030.

Link to interview:  https://soundcloud.com/rich-vetstein/richard-vetstein-interview-real-estate-radio-boston-3215

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Predictions On the Spring Real Estate Market from a Panel of Local Experts

“There’s no curb appeal if there’s no curb!” — Rona Fischman, 4 Buyers Real Estate

We are less than a week away from March, which usually signals the beginning of the frenzied spring real estate market in Massachusetts. However, unless you’ve been hibernating with the bears up in Maine, there’s a slight problem. We have snow. Lots. Of. Darn. Snow. The winter has wrecked havoc with everything, and that includes the real estate market.

Boston Magazine is bullish on the spring market, but what do the real experts think? I put the questions to my network of experienced local Realtors and mortgage professionals. I asked them if the snow will push back the traditional start of the spring market? What are inventory levels in your area? Do you have sellers waiting for better weather before they list? Are buyers waiting or are they trudging thru the snow to view listings? Do your see the spring as a buyer or seller market? Loan officers, where do you see rates and products this spring?

Here’s what they said, and don’t forget to clink their websites for more info.

ali-corton“I’m seeing a very sluggish start to 2015. Snow, cold temps, ice dams and the general malaise that’s set in on our region are all factors. I hear buyers are getting preapprovals and a few select properties have received multiple offers. But, overall it’s been slow and until sellers get houses prepped for market the buyers will wait on the sidelines.” — Ali Corton, Realty Executives Boston West, Framingham

Inman_Sep14_600x-144054“Inventory is definitely down here in Cambridge & Somerville — today we have just 31 active singles/condos/multis in Cambridge, compared with 46 last year on 2/26. In Somerville, we have 27 active listings today, compared with 40 last year. Granted, even those 2014 figures are really pathetic, as we’ve been dealing with extremely low inventory for the past several years, but this year is an extreme case. Funny thing is, those agents who are putting their sellers’ homes on the market are seeing plenty of traffic at open houses and showings, receiving multiple offers, and getting record-high prices, so I don’t know why anyone is hesitating to list.” — Lara Gordon, Coldwell Banker, Cambridge/Somerville

danielsteamsidebar2“The market in Sudbury is certainly slower than a typical winter market, but there are plenty of buyers hoping to take advantage of low rates and opportunities with motivated sellers. Like with any market, homes in popular price points that are prepared and priced right, are selling quickly and in some cases, resulting in multiple offers. Buyers aren’t as hesitant to go through the process now as Sellers are. Sellers are hesitant for many reasons, lack of curb appeal – which in many cases, great curb appeal adds value to the house, the thought of buyers trudging through their houses with snow on shoes (even though it’s always requested to remove shoes), ice dam damage, the thought of moving when the desire to hibernate is much more appealing and last but certainly not least, the liability involved in having a house on the market when snow/ice/icicles can potentially cause harm can be scary for homeowners. The Spring market should be strong, with plenty of pent up demand and after the winter of ’15, more city buyers looking for a beautiful garage with a nice house attached!” — Gabrielle and Carole Daniels, Coldwell Banker Sudbury

heidi-zizza amyuliss2“Definitely slower right now than usual. The market reports are quiet. I think everyone is tired of the snow and I have properties with ice dams affecting closing dates etc… I think Spring is going to POP everyone is going to be excited about warm wetaher but expect some wet basements….The market is just stagnant. Sellers want to sell but feel as if their home is not ready to be shown. Buyers jump on MLS everyday looking for new listings but slim pickings. If we could only get them all on the same page.” Heidi Zizza and Amy Uliss, mdm Realty, Framingham

Rona.red-shirt“Inventory in the Somerville-Cambridge metro area has been low for two years. This February, it was very low. I am anticipating another seller’s market, but less drastically uneven in 2015, compared to 2014 and 2013. This winter is likely to push people to move. I anticipate that people who planned a move in the next 2-4 years may jump sooner. City dwellers who struggled to park and find places to pile snow are anxious for off-street parking and some land. Over-housed suburban residents will sell to right-size into managed condos (where someone else hounds the plow guy to get there.) Retirees may head for warmer climes sooner. We all complain; home owners can do something about it. I suspect that inventory levels will become more even by late spring. Sellers will delay putting their houses on the market until after the snow is melted and their roof and ceiling damage is repaired. I have heard of two transactions that fell through because of ceiling leaks. There could be more stories about this, since so many houses have sprung leaks.” — Rona Fischman, 4 Buyers Real Estate Cambridge

bcav.png“Will there ever be a better time to buy a home? Mortgage rates are very close to 2 year lows today, and I expect them to stay down in this range thru 2015.  I think we see the 30 year fixed traded in the 3.75% to 4.25% for most of 2015.  This is still at a historical low at 4.25%. Continued economic weakness overseas, Banks/Lenders closing loans quicker and lowering their fees contribute to low mortgage rates all year folks!” — Brian Cavanaugh, RMS Mortgage Boston

284083_1902949570525_2002933_n“I have a few buyers and we have been walking thru knee deep and higher snow just to see some of these homes, agent’s don’t shovel thier listings nor do their sellers. I had one agent tell me the door would be open only to get there and walk through waste deep snow to find the door was locked and we could’nt see the house. I have buyers looking but the lack of good homes currently on the market is frustrating.” Sherry Stone-Graham, Touchstone Partners, Chelmsford

1631571.jpg“Even though we’ve had a “delayed winter” by having bulk snowstorms pretty much all at once instead of spread out throughout the last few months, it has slowed the market down in Southborough and Westborough although it hasn’t halted it entirely. There are 25 houses in varying price bands in my hometown of Southborough to choose from, with about 20% of them being in the over $900,000 range and just about 16% being in the $350-400,000 band. Despite the snow and the varying inconveniences that come along with it, over the last 45 days there were still 11 houses that are pending sale, which in my opinion still a positive sign. Interestingly enough, in neighboring Westborough, although the population exceeds that of Southborough and the snowfall hasn’t been much different, there are currently only 13 houses actively for sale, although the same 45 day period there were 15 pending sales. The majority of the active Westborough listings are in the $1M+ range, with the second highest in the $700-800k range. Ten of those pending sales ranged from the $200,000-400,000 price point, which may show that there is a definite need for inventory in those price bands to balance out the market.” — Jennifer Juliano, Keller Williams, Southborough-Westborough

1003349_10152067454786102_1832678940_n“With Janet Yellin’s recent speech, we may see rates start to step up by June, 2015. Just recently the international and domestic markets played theme park as they see-sawed back and forth causing rates to jump between about 3/8 over the last 3 months. However, in comparison to 1 year ago today, rates are still about 1% lower. So, bring on the inventory consumers.” — Jeff Chalmers, contact_katherine-newGuaranteed Rate, Norfolk

“My sellers in Winchester, Arlington, Woburn, Stoneham, and Melrose are waiting until the snow is more manageable. Homeowners are extremely preoccupied (and rightly so) with protecting their current homes. The more immediate demand is for ice dam removal!” — Katherine Waters-Clark, Arlington

779_photo“There were a few days where it was impossible to show in Boston. Otherwise things haven’t really slowed too much! In addition The Spring market seems to be beginning early as I am seeing more and more listings hitting the market. All in all the Boston real estate market remains extremely strong!” — Craig Anne Lake, Luxury Residential Group LLC, Boston

1688078.jpg“Bristol, Plymouth and Norfolk counties, lots of buyer calls and showing through the snow. Open houses averaging 3-4 families, inventory extremely low, prices going up, new construction permitted but held back from snow, sellers asking me to call back in March/April to list. My prediction is a sellers market first half of year then based on inventory to demand we will see if it equals out. Right now we are doing print materials, polishing off the listing and buyer presentations and balancing with rest and entertainment because April 1 st the flood gates are going to open and you better be rested and in shape to work extremely hard building your inventory and business to bring you through next winter with no worries. REST, AIM. FIRE!” — Dan Gouveia, Keller-Williams, SouthCoast

10014301_10152691646478077_8626708505441128924_o“I am in the Franklin area and the snow has definitely pushed back potential sellers, but the buyers are out there! They are looking, going to Open Houses and acting now while rates are low and PMI just went down as well. My advice would be to clean off that snow and get your house on the market now while inventory is low.” — Amber Cadorette, Keller-Williams Franklin

1765406.jpg“I agree, buyers are definately out going to open houses even with the record breaking temps and snowfall! I think the prediction that interest rates will be increasing next year has a lot to do with it. Personally, I don’t feel sellers are waiting for spring to list their homes. I listed two properties today (Northbridge) and will be listing another (Needham) next week.” — Anita Bertone, Keller-Williams Wrentham

“Buyers are swarming anything new to the market priced well – I have had multiple offers on my recent listings. The snow is NOT stopping the buyers so sellers should not wait till Spring when inventory will be better whicimages.aspxh usually lessens the value of their home. Supply and Demand…Little Supply + High Demand = More $$$ in Seller’s pockets!” — Anne Silverman, Realty Executives Boston West

Thank you to all the contributors to this post, especially Gabrielle Daniels who came up with the creative title! I’m sure this will be a much-read and much-shared article in the coming months. Let’s hope that this Ice Age ends soon and we can start buying and selling homes!

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Case is Good Reminder to Ensure That Contractors Register With State

With the record amount of snow, roof leaks and interior damage just beginning to hit Bay State homeowners, this spring should be a record season for Massachusetts home improvement contractors. But, according to a recent court ruling, contractors who don’t register as a licensed Home Improvement Contractor (HIC) could face serious liability under the state Consumer Protection Act (Chapter 93A) in any dispute with a homeowner. The case is Groleau v. Russo-Gabriele (Mass. Superior Court, Judge Douglas Wilkins).  Such penalties could include up to triple damages and an award of the homeowner’s attorneys’ fees.

This case serves as a timely warning to both homeowners and contractors that contractors should always be registered with the state and that homeowners select a reputable, licensed professional for their projects. Below are my well-worn 10 Tips to Hiring A Home Improvement Contractor (published earlier on this Blog).

1. Pre-Construction Planning

Recognizing that even the most thought-out home improvement project tends to run up to 10% over budget, careful planning and budgeting before the work starts is paramount. There are almost always going to be contingencies and unknowns (like the mold in your walls that you never knew about) cropping up during construction so you need to allocate a sufficient reserve (10-15% should do) to cover these unknown risks. Once the budget is set, stick to it, even if it means foregoing that gorgeous Italian tumbled marble in the master bath. Also, come up with a written construction schedule.

2.  Interview At Least 2 (But Preferably 3) Contractors and Obtain Written, Detailed Estimates From Each

I cannot tell you how many times homeowners select the first contractor to whom they were referred without vetting them through a proper bidding process. Interview 2, but preferably 3, contractors, be with them when they walk through hour home, and more importantly, get written, detailed estimates from each contractor. This is also your best opportunity to negotiate the best price as you can play each contractor against each other. Be aware that the cheapest bid does not necessarily equate with the best work.

3.  Obtain 3 References And Check The Better Business Bureau

This is a critical, yet often overlooked piece of preventative maintenance. Most folks are referred to a home improvement contractor through a friend or family member, however, you should ask the contractor for at least 3 references. Call each of them, then ask each of them if they know anyone else who has worked with the contractor and call them too. (The contractor will always list their most “friendly” references). Ask them if the contractor performed quality work on time and within budget. Were there issues with scheduling, delivery of the correct materials, and the labor?  This is your opportunity to get the real scoop. Search the Better Business Bureau for any complaints about the contractor. The BBB has a good resource for spotting contractor rip-off artists.

4.  Check License/Registration Status Of Contractor 

You should always select a licensed and registered home improvement contractor. They are regulated by the state and using them entitles you to the protection of the Massachusetts Home Improvement Law and Contractor Guaranty Fund if there is a problem. There are 2 types of home improvement contractor licenses in Massachusetts. A Home Improvement Contractor (HIC) license covers most types of typical home improvement work, except for structural work. Structural work must be performed by a contractor holding a Construction Supervisor License (CSL). You can search for Massachusetts HIC or CLS licensed contractors here. The license search also discloses any complaints against the contractor.

5.  Sign A Written Construction Contract In Compliance With Massachusetts Home Improvement Law (General Laws Chapter 142A)

The Massachusetts Home Improvement Law provides the bare minimum of what is required to be in home improvement contracts over $1,000, but most contracts supplied by the contractor are non-compliant and terribly one-sided. Here’s what you need in your home improvement contract:

  • The home improvement contract must be written, dated, and signed by both parties. Make sure the contractor executes the agreement under the entity which is pulling the permits. Some contractors attempt to work  under another contractor’s company or worker’s compensation policy–this is a red flag. If the contractor is not incorporated but is a “dba” (unincorporated doing business as), he must sign individually. The contractor needs to list his license number as well.
  • The home improvement contract must provide the start date of the work and the date of “substantial completion.”
  • The home improvement contract must provide a detailed description of the work and materials involved.  I suggest incorporating that detailed estimate provided by the contractor discussed previously. (You can attach it as an exhibit or addendum to the end of the contract).
  • The contract must detail the scope of work, being as specific as possible. I cannot emphasize this enough.  Itemize the exact type of materials involved (Andersen windows, California paint, Italian ceramic tile, etc.), and work to be performed (full kitchen remodel with installation of new flooring, appliances, etc.). If you are not specific in the contract, and there’s a problem later, your claim will be severely weakened, if not dead on arrival.
  • The contract must provide the total contract amount and the timing of progress payments. Massachusetts law prohibits a contractor requiring an initial deposit of over 33% of the total contract price unless special materials are ordered.  Any contractor demanding over a 33% deposit should raise a huge red flag . (I recommend setting up payments into thirds, with the first payment due at the start of work, the second payment due halfway through the work, and the final payment due at the satisfactory completion of the work.)  The homeowner should always “holdback” up to 33% of the total cost until the work is done and done right.
  • There are other requirements mandated by the Home Improvement Law.

To be safe, I recommend having an attorney review the contract. Proposed contracts which do not comply with the Home Improvement Act are a red flag.

6.  Hold A Pre-Construction Meeting

Seems pretty obvious, but again frequently contractors jump into a job right after signing the contract without taking the take to meet again with the homeowner. Walk through the project again after the initial estimate. Discuss any changes and scheduling issues. Pin down the contractor as to exactly when the crew will be on the job. Talk about expectations for day end and clean up.

7.  Verify Sufficient Liability Insurance and Worker’s Compensation Insurance 

Obtain the contractor’s Worker’s Compensation Insurance Coverage sheet showing that it has worker’s compensation insurance in place as well as the coverage page for its Commercial General Liability (CGL) policy. Request that the contractor add you (and your spouse if you own the home jointly) as “additional insureds” on the policy with at least $1M in liability coverage in place. This should protect you if a worker injures himself on the project site.

8.  Ensure The Contractor Pulls All Permits 

Always have the contractor pull the building, plumbing and electrical permits. Owners who secure their own permits are ineligible for protection under the Home Improvement Law. If a contractor is reluctant to pull permits himself, it’s a red flag.

9.  Document All Changes In Writing

I cannot tell you how many times that after signing a comprehensive written agreement, homeowners and contractors alike change the work and increase the contract price orally without any written documentation. This is a huge No-No and will get the homeowner into trouble every time. Ask the contractor for a “change order” to fill out and sign, or create one yourself.  It should, at minimum, provide the original contract price, a detailed scope of the new work, its cost, and the updated total, signed and dated by both parties.

10.  Carefully Monitor The Project And Keep Lines Of Communication Open

Seems like common sense, but don’t go on vacation during a home improvement project, lest you arrive home to a mini-disaster. Keep a log of daily activity that you can match up with the project schedule. Another common complaint is when the construction crew inexplicably fails to show up when you expect and is instead at another project. This happens a lot at the end of the project when the contractor is focusing on the next job. Email or write the contractor and get his firm commitment to finish your job or else you will withhold final payment. If there are any issues or problems, the best way to cover yourself is to document them. Email works great here as it is not too formal yet more than adequate to memorialize the event. Create a final punch list for all incomplete items and withhold final payment until it is completed.

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I will be speaking at the upcoming Metrowest Resourceful Realtor Meeting on March 2, 2015 at John Harvard’s Brewhouse at Shoppers World, Framingham. Networking starts at 5:45PM with dinner and speakers starting at 6:30PM. Any licensed estate agent welcome.

I’ll be talking about the latest court rulings and legislation affecting Massachusetts real estate law, intermixed with a few colorful war stories from the front lines. Topics will include the status of the independent contractor office model, the new CFPB closing disclosures and settlement statements, and a rental housing update.

Also speaking is Sandy Krenz, a 30-year interior designer and consultant with Debsan Paint in Natick. She will talk about color and decorating trends.

RSVP to aimee.siers@commonmoves.com with your choice of dinner (see invite).

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ice-dam-2As we shovel out from the snowiest winter in history, the Greater Boston area will soon be facing a new and potentially more destructive situation — ice dams and roof collapses. This could be the worst winter ever for ice dams and roof issues due to the ridiculous amount of snow still stuck on our roofs. I’ll take a minute to go over the insurance issues and preventative measures you should be taking now.

Ice Dam Insurance Coverage – Massachusetts

Interior or exterior damage caused by an ice dam on your roof is typically covered by standard homeowner’s insurance policies. However, most policies will not cover ice dam or snow removal from your roof or anywhere else on your property. As with any insurance claim, call the claims department immediately and take photos of the damage.

Ice Dam Treatment & Prevention

The best way to deal with ice dams is to physically remove them from your roof. I’m not a fan of homeowners putting their spinal cords at risk by hopping on snow covered roofs, so my advice is to leave this to the professionals. Crews are out in full force clearing snow and chipping away at ice dams. Feel free to call my friend George Lonergan of Lonergan Construction in Framingham (Tel:  508-875-0052). Tell them Rich Vetstein sent you. Also, be aware of price gouging and scams.

In the short term, there are a couple things you can try.

  1. Try to remove snow from the roof but only if it can be done safely. A roof rake or push broom can be used but may cause damage to the shingles. There is an amazing new type of roof rake on the market called a Roof Razor which can be purchased here. If it’s not possible to remove the snow safely, call a professional like I did.
  2. Chisel grooves into the dam to allow the water behind it to drain off. This is a good emergency measure, especially if rain or a sudden thaw is coming. Be careful not to damage those shingles!
  3. Don’t laugh, but fill an old pair of your wife’s pantyhose with calcium chloride snow melt and lay it across the dam. I’m not kidding! It will help to melt the dam and also keep that area of the roof clear. DO NOT USE ROCK SALT! It will stain the roof and siding. It is best for small dams or prevention. It’s also a good idea to scrape the snow off the roof first.
  4. There are also ice melting pucks you can use. You can get them at Home Depot.

To prevent ice dams in the longer term, keeping warm air from escaping into the attic is the first course of action. More insulation and new shingles are a start.

Good luck with your roof!

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Winter Storm Minnesota

Shovel Early and Often!

This winter has been one of the snowiest on record, and there is another major snow event on the way. Judging from the astronomical number of recent clicks on this blog, it’s clear that people want to know all about Massachusetts snow removal law. The law underwent a monumental change back in 2010 with a Supreme Judicial Court decision overruling the 125 year old “Massachusetts Rule” which allowed property owners to leave “natural” accumulations of snow and avoid liability. Now, owners are under a legal duty to keep their property free from dangerous snow and ice. Moreover, cities and towns have been passing all types of new snow removal ordinances and by-laws regulating whether owners must shovel public/private sidewalks, and how long they have to clear snow.

It’s clear that it’s time to give you the most up-to-date information. So here is a fresh set of Frequently Asked Questions (and Answers) with links at the end to various city and town webpages on their snow removal policies. Good luck and stay safe!

I own a two family rental property with a driveway and one common walkway and entrance. Am I responsible for shoveling snow on the driveway and/or walkway?

The answer is yes. Under a 2010 Supreme Judicial Court ruling, all property owners (rental or owner occupied) can be held liable for failing to remove snow and ice from their property. The old rule was that owners didn’t have to remove “natural accumulations” of snow and ice, but the court overruled that in favor of a general obligation to keep property safe for all visitors and guests. There are also many local town and city ordinances which likewise obligate property owners to keep snow and ice off their property and sidewalks. I will discuss some of those below.

Can I use a lease which provides that the tenant is responsible for snow removal. Is that legal and will that protect me from liability?

It depends on your particular property. Landlords have the primary responsibility for snow removal at a rental property. Under the State Sanitary Code, property owners/landlords must keep all means of egress free from obstruction — that cannot be negotiated away. As for the removal of snow and ice, the Code provides that the landlord shall maintain all means of egress at all times in a safe, operable condition and shall keep all exterior stairways, fire escapes, egress balconies and bridges free of snow and ice. Again, those obligations cannot be negotiated away.

A landlord may require the tenant be responsible for snow and ice remove in a lease provision only where a dwelling has an independent means of egress, not shared with other occupants, and a written lease provides for same. On its face, this exception only applies to entrance-ways and not driveways or parking areas. I am not aware of a court ruling on this particular Code provision, but if I were a landlord I would not risk being on the wrong side of a “test case” where someone is injured badly.

So, in the example above with an owner occupied two family with one common entrance and driveway, that lease provision would be illegal.

Even if the tenant is responsible for snow removal under a legal lease provision, the landlord could still face personal injury liability for slip and falls on snow and ice under the SJC ruling.  A guest or visitor who is injured due to untreated snow or ice will likely sue both the property owner and the tenant. The property owner must ultimately ensure that the property is safe for visitors.

How soon do I have to shovel the snow before I get in trouble?

The City of Boston’s policy is to give businesses 3 hours to clean snow, and 6 hours to residents. In Worcester, it’s 12 hours to clear snow. Those are the minimums. As with any dangerous condition, my advice is to shovel and treat snow and ice early and often. Even a thin coating of black ice can cause someone to slip and fall and seriously hurt themselves. (Admit it if you’ve dumped on your rear end like I have!). If you are an out-of-town landlord, you must hire someone to shovel your snow.

Am I required to shovel the public sidewalk in front of my house/business after a storm?

In most Massachusetts towns and cities, the answer is yes. Check your local town ordinances for guidance. The cities of Boston, Cambridge, Somerville, Arlington, Belmont, Newton, Lynn, and Worcester (among others) all require property owners and businesses to clear municipal sidewalks in front of their residences or businesses. Fines are assessed against non-compliance. In Somerville, for example, if snow ceases to fall after sunrise (during daylight hours), property owners must shovel sidewalks by 10 p.m, and if snow ceases to fall after sunset (overnight), property owners must shovel sidewalks by 10 a.m. You can also be fined for shoveling snow onto the street, blocking a curb cut or putting snow on municipal owned property.

In some more residential towns, the local DPW will clear the sidewalks, but the default rule is that property owners are generally responsible for clearing their own sidewalks and driveways.

Will my homeowner’s or CGL insurance policy cover any injuries from slip and fall on snow/ice?

Yes, usually. The standard Massachusetts homeowners insurance policy and commercial general liability insurance policy (CGL) will have liability coverage for slip and falls on property. Make sure you have ample liability coverage of at least $500,000 to 1 Million. (You can never have enough insurance!). As with any insurance question, it’s best to contact your personal insurance agent.

I’m just a regular homeowner. What if the mailman or delivery person slips on my walkway?

You may be liable if you left dangerous snow and ice on your walkway. The new law applies to every property owner in Massachusetts, not just landlords. Get some Ice-melt and sand and spread on your walkway. If it re-freezes overnight into black ice, you will remain liable.

Helpful Links

Arlington Snow Info

Belmont Snow Ordinance

City of Boston Snow Center

Brookline Snow Alerts

Cambridge Snow Guide

Lawrence Winter Parking Rules

Lynn DPW Winter

Marlborough DPW

Medford Police Dept. Snow 

Needham MA Snow & Ice

Newton Snow Page

Quincy Snow Removal

Salem Snow Emergency Rules

City of Springfield Snow Rules

Somerville Snow Guide

Waltham Snow Policy

Wayland Snow Policy

Worcester Snow DPW

Winter Storm Precautions

  • Keep roads clear to allow plowing operations to proceed smoothly.
  • Use care around downed power lines. Assume a down wire is a live wire.
  • Check in with your neighbors, especially those that may need assistance.
  • Help dig out fire hydrants and storm drains in your neighborhood.
  • If you live on a corner, clear a path from the sidewalk to the street. If not precisely on the corner, as close to the corner as you can get.
  • Avoid parking too close to corners, allowing Public Safety vehicles and plows to maneuver safely.
  • Be aware of children playing in the streets, particularly climbing on or running out from behind large snowdrifts
  • Parents should remind their children to be aware of plowing operations and traffic.
  • Clear exhaust vents from Direct Vent Gas Furnace Systems to avoid carbon monoxide poisoning.
  • Never run an automobile until exhaust pipe has been cleared of snow.
  • Make sure backup generators are well ventilated.
  • Take your time shoveling. Avoid overexertion.
  • For homes heated by oil please be sure a safe route is available for delivery to your oil fill pipe.
  • Clear flat roofs and decks to prevent accumulation of snow/ice over the season.

 

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City Universities Providing ISD With Addresses of Student Apartments

In the coming weeks, some Boston college students living off-campus and their landlords may be greeted by city inspection officers at their doors. Shrugging off privacy concerns, pursuant to a new city ordinance, the city’s 31 local colleges and universities have sent the city’s Inspection Services Department the addresses of their students who live off-campus. Of the 25,000 addresses it received, ISD will pay visits to the 580 it deems to be suspect of violating zoning codes. Boston.com reporter Julie Xie in her article “City Will Inspect Off-Campus Student Apartments, And It’s Legal” reported this new development.

They’ll primarily be looking for issues related to overcrowding. There are over 45,000 undergraduate and graduate students living off-campus in Boston, according to The Boston Globe . A 2008 city ordinance prohibits more than four undergraduates living together in one apartment.

The city’s crackdown comes in the wake of BU senior Binland Lee’s tragic death in 2013 from a fire in her overcrowded Allston apartment. Flames blocked the staircase from the third floor — her only egress. Scofflaw landlords and poorly managed units unsafe for students were the subject of the Globe’s “Shadow Campus” investigation last year. Now, an ordinance requires colleges to provide a list of where students live off-campus every semester. Another requires private rental units to register their properties annually, and inspections are performed every five years.

There is no question that some Boston landlords catering to the huge undergraduate population have skirted the law, creating dangerous living spaces for far too long. Regardless of the issue of occupancy limits, landlords need to comply with the sanitary and building codes so they don’t create fire traps for housing.

However, I have always had issues with the legality of the 4 undergraduate rule. I’m quoted in the article as saying that the no-more-than-four rule has always been somewhat suspect, arbitrary, and tough to enforce. Though neighbors do complain about late-night parties and loud college students, not all undergrads are troublemakers.” “Undergrads are not a protected class under any discrimination laws, and they’re transient, so it’s not like they’re going to come up with a lobbyist or fight for their rights in that way,” I’m quoted. “Colleges don’t want to get in trouble and they know they won’t get much pushback from Boston’s student body.”

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1__1263399571_0444-300x199One of Largest Verdicts In A Condominium Dispute

In a David vs. Goliath case pitting a Demoulas family heir against an elderly Brandeis professor over a tony Back Bay townhouse, the Appeals Court has let stand a $1.85 Million jury verdict — one of the largest awards in a private condominium governance dispute. The case is also one of the first to successfully employ the Massachusetts Civil Rights Act in a private real estate dispute. With interest and an award attorneys fees of $1.9 Million, the judgment will swell close to $4 Million — providing a cautionary tale to condominium trustees who abuse their power for ulterior purposes. The case is Kettenbach v. Wodinsky, Mass. Appeals Court (Jan. 6, 2015), embedded below.

A Classic David vs. Goliath Tale

In 1996, Michael and Frances (Demoulas) Kettenbach bought a unit in the 5 unit townhouse located at 303 Commonwealth Avenue in the Back Bay. (Frances is the sister of Arthur T. Demoulas who was recently reinstated as CEO of Market Basket after a publicized family fight). With the goal to acquire all of the units and convert the building to a grand single family Back Bay residence, Kettenbach purchased three more units, leaving only the top floor unit owned by Jerome and Bernadette Wodinsky. The Wodinskys, who had owned their the fourth floor unit for over 30 years, didn’t want to sell.

According to the court’s ruling, Kettenbach enlisted Gary Crossen, a former prominent Boston attorney who was the Demoulas family’s trial lawyer in their epic family litigation in the 1990’s. When the Wodinsky’s made it clear they were not selling, Kettenbach and Crossen began to put the proverbial “squeeze” on them. Armed with the controlling interest in the condominium association, they summoned state inspectors to condemn the building elevator, leaving the 82 year old Wodinsky, who suffers emphysema, to make the daily climb up 86 stairs to his fourth floor unit. Instead of repairing the elevator, Kettenbach voted to replace it at a $275,000 price tag. When the roof leaked, rather than repair it, Kettenbach insisted on installing a new one – even though it was only 10 years old. He also completely replaced the building’s heating system and did a massive overhaul of the electrical system. The result was a $1 million special assessment, 20% of which Kettenbach attempted to impose on Wodinskys. Kettenbach also hired a private investigator who showed up at Mrs. Wodinsky’s workplace and threatened her with bankruptcy.

Staggering Jury Verdict

Not backing down, the Wodinskys sued, asserting claims under the little used Massachusetts Civil Rights Act, abuse of process, civil conspiracy, and the Consumer Protection Act, Chapter 93A. They won an early victory when a trial judge issued an injunction forcing Kettenbach to fix the elevator. The case went to trial in 2011 over 19 days, and the jury returned a whopping $1.85 Million verdict in the Wodinsky’s favor. Although the trial judge vacated the judgment on the Chapter 93A count, which would have given the Wodinsky’s triple damages, he left the judgment intact on all other claims. Both parties appealed.

Jury Verdict Upheld on Appeal

On appeal, Appeals Court Justice William Meade upheld the entire jury verdict and judgment, and awarded the Wodinsky’s their appellate attorneys’ fees and costs, which will balloon the judgment against Kettenbach to well over $4 Million and change. The justice held that there was ample evidence that:

Kettenbach and Crossen coerced, intimidated, and threatened the Wodinskys in an effort to force them out of their home. This evidence includes: the Kettenbachs’ active attempts to condemn and decommission the building’s only elevator; the excessive period of time during which the elevator was unusable, which forced the elderly Wodinskys to walk up and down four flights of stairs; Crossen and the Kettenbachs’ manipulation of the board’s voting process to the Wodinskys’ detriment; the Kettenbachs’ demand that the Wodinskys pay twenty percent of expensive, unneeded projects that were not lawfully voted upon by the board; the Kettenbachs’ instituting litigation against the Wodinskys to collect such payments while simultaneously forgiving the assessments of another owner who agreed to sell her unit; and the Kettenbachs’ hiring of a private investigator to visit Bernadette at her work place for the specific purpose of threatening the Wodinskys with bankruptcy.

Since a member of the Demoulas family is involved, you can bet that this case isn’t over yet, and that he will try to get the Supreme Judicial Court to hear this case. And he might be successful as this is a huge jury verdict and, as mentioned earlier, one of the largest involving the Massachusetts Civil Rights Act.

Expansion of Condominium Trustee Liability?

Although this was a particularly unique and egregious case, this ruling could be used to expand liability against condominium trustees to for state civil rights violations arising out of contentious governance and assessment disputes. I’m not so sure that the Mass. Civil Rights Act is the appropriate vehicle to address this sort of private claim, because I don’t see how it invokes traditional constitutional rights which the Act was intended to protect. The SJC will have to sort this out but if they don’t take this case, this ruling will be the law of the land. Either way, I will bet that we haven’t heard the end of this dispute.

Kettenbach v. Wodinsky

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