Leasing

apartment-balconySheehan v. Weaver: Strict Liability For Building Code Violations Does Not Apply To Residential Structures

I love being right.

Two years ago, Northeast Housing Court Judge David Kerman issued a controversial ruling that an owner of a mixed used building was “strictly liable” for a intoxicated tenant’s fall through a defective porch guardrail in the case of Sheehan v. Weaver. In my prior post on this troubling case, I said “given the concerning expansion of liability in this case, look for this ruling to get appealed. Judge Kerman is a well-respected judge, and this decision is a close call, but I think he went a bit too far outside the legislative intent behind the law.”

Well, that’s exactly what the Supreme Judicial Court said in its ruling today which should provide some relief for residential landlords and their liability insurers.

Faulty Porch Guardrail

The landlord, David Weaver, owned a building with three residential apartments located above a commercial establishment. None of the apartments were owner-occupied. After a night of drinking, one of Weaver’s residential tenants, William Sheehan, fell through a porch guardrail, several stories onto the asphalt pavement below, suffering serious injuries. The connection of the guardrail to its post gave way because it was defective and in violation of the Building Code.

After a four-day trial in the Housing Court, a jury found for the tenant on the negligence claim, awarding approximately $145,000 after a 40% reduction for the his own fault. The jury also found the landlord strictly liable, assessing $242,000 in damages. With the strict liability, the landlord was on the hook for the full $242,000 verdict without consideration of the tenant’s own fault. The case went up to the SJC on appeal.

Interpretation of Building Code Statute

The Massachusetts State Building Code provides for strict liability, that is, liability without any consideration of the comparative fault of the injured, for any personal injuries caused by a building code violation at any “place of assembly, theatre, special hall, public hall, factory, workshop, manufacturing establishment or building.” The SJC ultimately agreed with the landlord that the structure where the tenant was injured was not sufficiently commercial to be considered a “building” within the meaning of the Building Code’s strict liability provision. The court held that “what commercial and public structures listed in § 51 have in common is that they are places in which a large number of people gather for occupational, entertainment, or other purposes.”

What this means is that owners of residential rental property will no longer have to worry about getting hit with a substantial strict liability award for injuries caused by building code violations. However, this does not mean that property owners should not take care of their buildings. They must, and they can still get hit with lawsuits for injuries occurring on their property due to failure to repair or maintain the premises in good condition. Indeed, in this case, the final result is that the tenant’s award will be reduced by about $100,000 but the landlord’s insurance company will still be on the hook for a $145,000 judgment plus 12% interest.

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Decision Could Have Wide Impact Upon Marijuana Use By Tenants

The law on marijuana and rental housing remains clouded to say the least. And that’s no pun. This week on April 8th, the Supreme Judicial Court will consider the first of probably many cases dealing with marijuana use in rental housing. In this particular case, Boston Housing Authority v. Figgs (SJC 11532), the high court will assess whether a state housing authority may evict a subsidized tenant and terminate her federal housing benefits for the alleged possession of less than one ounce of marijuana — which is no longer a criminal offense in Massachusetts, but still a crime under federal law. With the decriminalization of small amounts of marijuana, the rollout of the medical marijuana dispensaries and the conflict with federal drug laws, this case may have wide-ranging impacts upon the relationships of landlords, tenants, housing authorities and even condominium owners and trustees over the use of marijuana, both recreationally and medicinally.

Oral arguments are available via live stream here. Legal briefs and filings in the case can be found here. A final opinion and ruling is expected this summer.

This case should also put the new Medical Marijuana Law into re-focus. Landlords have been increasingly anxious about how to manage and regulate tenants’ use of medical and recreational marijuana, if at all. The law not only grants qualified patients the right to obtain medical marijuana but it also allows patients the right to grow a two-month supply of marijuana at home if they cannot get to a marijuana dispensary because they are too sick or too broke. There is a bill in the Legislature granting landlords the right to prohibit medical marijuana on rental property without fear of being sued for disability discrimination.

I’ll be monitoring this new and dynamic area of the law. It will surely be a hot topic in the next couple of years.

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100316_photo_vetstein (2)-1Richard D. Vetstein, Esq. is an experience Massachusetts landlord tenant and real estate attorney. If you are concerned or have questions about the new Medical Marijuana Law, please contact him atinfo@vetsteinlawgroup.com.

 

 

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NIGHTCODE_CRR3The Massachusetts State Sanitary Code governs the minimal standards of fitness and conditions for human habitation of rental occupancy of property. Unfortunately, most landlords become familiar with the lengthy code only after tenants or the local Board of Health cites them for code violations. As a landlord-tenant attorney, I’ve created this comprehensive summary of the Massachusetts State Sanitary Code. Mind you, this does not cover every single provision,  just the important ones, in my opinion. Keep this handy guide on your nightstands in case you have insomnia! Seriously, this is important information for all rental property owners in Massachusetts.

Scope

The Massachusetts State Sanitary Code is found at 105 Code of Massachusetts Regulations 410, which can be downloaded by clicking here. The Sanitary Code applies to all rental properties in Massachusetts including owner-occupied multi-families, rooming houses and temporary housing. The only exceptions are dwellings located on a campground and civil defense shelters.

Kitchen and Bathroom Requirements

The Code provides that every rental unit where common cooking facilities are provided shall contain a kitchen sink, a stove and oven and space and proper facilities for the installation of a refrigerator. Each unit must include at least one toilet, one washbasin (which cannot be the kitchen sink) and one bathtub or shower in a separate bathroom. Privies and chemical toilets are prohibited except with Board of Health permission.

Potable Water

Landlords must provide “a supply of potable water sufficient in quantity and pressure to meet the ordinary needs of the occupant” either connected to town/city water or private well with Board of Health approval. The landlord may charge tenants for actual water usage if separately assessed and metered. Hot water must also be provided of not less than 110°F and no more than 130°F.

Heating

Landlords must provide for adequate heating in every habitable room of a rental unit including bathrooms. Portable space heaters and similar equipment are prohibited. Heating must be provided to no less than 68°F between 7AM and 11PM and at least 64°F between 11PM and 7AM, except between June 15 and September 15.

Natural Light and Lighting Fixtures

The Code requires at least one window in all rooms except the kitchen if less than 70 s.f. Lighting fixtures must be provided in all bathrooms. Two outlets must be provided in every habitable room, and sufficient lighting provided in all hallways, foyers, laundry rooms and the like. Buildings over ten units must have auxiliary emergency lighting. Screens must be provided for all windows on the first floor.

Maintenance Obligations

An oft-litigated area, the Code provides for maintenance obligations for both landlord and tenant. Landlords must maintain and repair whatever appliances he has installed in the unit. If a tenant has paid for and installed an appliance himself, however, he is responsible for maintaining it. Tenants are also responsible for the general cleanliness of toilets, sinks, showers, bathtubs, and kitchen appliances. So when the tenant claims there is mold in the bathroom, the landlord can argue that the tenant’s lack of cleanliness is the cause. Landlords must also exterminate any pest, insect or rodent infestation.

Asbestos and Lead Paint Materials

If there is asbestos material in the unit, the landlord must keep it in good repair, free of all defects, cracks and tears which would allow for the release of asbestos dust. Due to the liability exposure, it’s a good idea for any landlord to remove all asbestos materials. Lead paint is absolutely prohibited where children under 6 are occupying. See my previous posts on the Lead Paint Law for more info on this complex area.

Utility Metering

Owners must provide electric and gas service to tenants unless they are separately metered and billed to the unit and the lease provides for same. Separate water metering is permissible so long as the landlord gets written approval from the local Board of Health and complies with the metering requirements of General Laws chapter 186, section 22. For homes heated with oil, the owner must provide the oil unless it is provided through a separate oil tank servicing only that dwelling unit.

Minimum Square Footage

* 150 s.f. for the first occupant, and no less than 100 s.f. for each additional occupant
* Bedrooms — 70 s.f. for first occupant, 50 s.f. for each additional occupant
All ceilings must be no less than 7 feet.

Egress/Snow and Ice Removal

Property owners must keep all means of egress free from obstruction. As for the removal of snow and ice, the Code provides that the owner 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. A landlord may require the tenant be responsible for snow and ice remove only where a dwelling has an independent means of egress, not shared with other occupants, and a written lease provides for same. Otherwise, landlords are responsible for snow and ice removal. Even if the tenant is responsible, the landlord could still face liability for slip and falls on snow and ice under recent Massachusetts case law.

Locks

Owners must install locks for every door of a dwelling unit capable of being secured from unlawful entry. The main entry door of a three unit dwelling or more must be installed with a automatic locking mechanism.

Smoke/CO2 Detectors

Smoke and carbon monoxide detectors must be installed in accordance with the Mass. Fire Code.

Railings

Owners must provide safe handrails for every stairway, and a wall or guardrail on every open side of a stairway no less than 30 inches in height. For porches and balconies, a wall or guardrail at least 36 inches high must be provided. Between all guardrails and handrails, balusters at intervals of no more than 6 inches for pre-1997 construction, and at 4.5 inches for post 1997 construction must be provided.

Inspections and Code Violations

The Code provides that the local Board of Health or Inspector can inspect any unit upon the  oral or written complaint of an occupant. Inspections are supposed to take place within 24 hours of the complaint, but that rarely happens. The inspector will prepare a code violation form. Serious violations such as failure to provide heat or water must be corrected within 12 hours. Less serious violations should be corrected within 5 – 30 days depending on the type of violation. Violators have a right to a hearing before the board of health to contest any code violations.

Code violations are criminal proceedings and should not be ignored. Penalties can result in $500/day fines and even condemnation of the premises.

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100316_photo_vetstein (2)-1Richard D. Vetstein, Esq. is an experienced Massachusetts landlord-tenant attorney. If you have been cited for violations of the State Sanitary Code or have questions about it, please contact me at rvetstein@vetsteinlawgroup.com or 508-620-5352.

 

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eviction-notBill Would Curb Tenant Abuses of Eviction Process | State House Hearing Set For Feb. 25

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. This may finally be the year that the Legislature passes this much needed reform to curb tenant abuses of the eviction process. Two bills, H.B. 1131 and H.B. 1110, have made their way to public hearing at the State House for a February 25th hearing before the Joint Committee on Housing. Landlords are urged to come and testify before the committee and otherwise support the bill by contacting their local representatives and senators.

The bills are designed to reform tenant abuses of the rent withholding law, including the infamous “free rent trick.” 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.

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.

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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Where-are-you-from-512x273Innocent Small Talk Apparently Illegal, According to Boston Fair Housing Commission

The seemingly innocent question posed by a Boston rental agent to Gladys Linder when they were searching for an apartment was “Where are you from?”

“Venezuela,” she answered.

Gladys and her husband went on to find an apartment a month later without further incident. But she found the question about her national origin insulting and upsetting.

This is Massachusetts, and you know what came next.

Stokel filed a complaint with the Boston Fair Housing Commission, claiming that rental agent’s question was discriminatory and caused her to suffer fear, anxiety and sleeplessness over a three-year period.

Seriously?

Massachusetts General Laws Chapter 151B and the Boston Fair Housing Commission Regulations make it illegal for any licensed real estate broker “to cause to be made any written or oral inquiry or record concerning . . . national origin.”

Although this was the agent’s first discrimination complaint and there was no discriminatory impact on the tenants at all, the Commission found that the question itself was unlawful and issued one of the largest penalties I have seen in recent years — $10,000 in emotional distress damages, plus $44,000 in attorney’s fees and costs and a $7,500 civil penalty against the broker — a whopping $61,500 in total liability for this single question, not to mention the tens of thousands the agent had to pay for defense legal fees.

The ruling can be found here:  Linder v. Boston Fair Housing Commission, Mass. Appeals Court (Dec. 17, 2013).

Appeals Court Uses Some Much Needed Common Sense

The case went up on appeal, and fortunately the Massachusetts Appeals Court exercised some common sense and slashed the award, likely by more than half pending further proceedings. But the court let stand the commission’s ruling that the one innocuous question did indeed violate the discrimination laws. So the broker will remain on the hook for a sizable liability.

Honestly, I’m having a lot of trouble with this ruling. It appears that the broker was simply engaging in some harmless small talk by asking the applicant where she was from. There was no evidence that the broker refused to rent to her or took any other discriminatory action against them. What if the applicant had a Southern accent and said she was from Alabama? That’s not illegal discrimination, but since she is from another county, it makes the question unlawful discrimination? Unbelievable! This is one of those cases where the anti-discrimination laws result in a totally absurd result.

So thank you to the Boston Fair Housing Commission for making small talk illegal. Unfortunately, the lesson to be learned from this case for rental agents and Realtors: Don’t ask a client where they are from. I kid you not. Only in Massachusetts…

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100316_photo_vetstein-2.pngRichard D. Vetstein, Esq. is an experienced Massachusetts real estate attorney who often consults with Realtors and rental agents on their legal and ethical duties. He can be reached at info@vetsteinlawgroup.com.

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dive-warningLandlords Could Be Held Responsible for Tenant Paralyzed Jumping from Trampoline into Kiddie Pool

I don’t write a lot about premises liability in this blog, but this tragic case out of my hometown of Framingham may be a classic example of the saying that “hard cases make bad law.“ The Supreme Judicial Court has granted a new trial to a man paralyzed by jumping off a trampoline into a kiddie pool while playing with his small son. The case is Dos Santos v. Coleta (SJC – 11188). This is a case which will get all the tort-reformers screaming in protest, but it is evident that premises liability law in Massachusetts keeps on evolving and not in a good way for property owners.

The moral of this case for landlords and all homeowners is to not leave potentially dangerous contraptions in yards for tenants and kids to get injured on. Also, make sure you have liability insurance coverage for at least $1 Million, and look into getting an excess umbrella policy for up to $5 Million.

Summer Fun Goes Terribly Wrong

In the summer of 2005, Cleber Dos Santos lived with his wife and son in one unit of a two-family home in Framingham that he rented from the Coleta family. The landlords, who lived in the other unit, set up a trampoline immediately adjacent to an inflatable kiddie pool in the backyard. The landlord disregarded warnings printed on the side of the pool cautioning against jumping or diving into the pool. He knew that setting up the trampoline next to the pool might be dangerous but thought it would be “fun.”

The landlords moved to South Carolina on July 31, but they maintained ownership of the home and continued to rent the other unit to Dos Santos and his family. The landlords left the pool and trampoline in the backyard and understood that both items would continue to be used by their friends and family.

On the evening of August 2, 2005, Dos Santos, who had never before used the trampoline, came home from work and decided to play with his son on the trampoline while his wife recorded a video of them to send to their extended family in Brazil. He decided to entertain his son by flipping into the pool. He severely underrotated the flip, entered the water headfirst, and struck his head on the bottom of the pool. As a result of the impact, Dos Santos sustained a burst fracture of his C-5 vertebrae, and is permanently paralyzed from the upper chest down. He has been hospitalized ever since with medical bills exceeding $700,000.

SJC Clarifies Open and Obvious Danger Rule

Perhaps not surprisingly, the jury rendered a defense verdict on the basis that Dos Santos’ backflip from a trampoline into a kiddie pool was an “open and obvious” danger. But the SJC found the trial judge’s jury instructions lacking, holding that even if the jury believed that the danger present was open and obvious, the jury should have considered whether the absentee landlord should have removed or remedied the dangerous trampoline/pool setup from the backyard.

Having established that the existence of an open and obvious danger will not necessarily relieve a landowner of all duties to lawful entrants with regard to that danger, we set out to answer the following principal question: where the duty to warn has been negated, in what circumstances will the duty to remedy nevertheless exist–or, in other words, in what circumstances “can and should a landowner anticipate that the dangerous condition will cause physical harm to the lawful entrant notwithstanding its known or obvious danger”?

In plain English, Judge Cordy is basically saying that performing a backflip from a trampoline into a kiddie pool may be stupid and dangerous, but it’s also just as stupid and dangerous for a landlord to leave the deadly contraption out in the backyard for anyone to get injured on.

The justices ordered a new trial in the case, so this tragic 8 year legal saga will continue on. (Also remember that it appears that the landlords are covered by a liability insurance policy, the amount of which is unknown).

In sum, the SJC has now shown that Massachusetts premises liability law continues to shift towards even greater responsibility and liability for rental property owners.

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RDV-profile-picture-larger-150x150Richard Vetstein is an experienced Massachusetts landlord tenant attorney. You can contact him at info@vetsteinlawgroup.com or 508-620-5352.

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539w-1.jpgRuling Calls Into Question Boston Ordinance Prohibiting 5 or More Students In One Unit

Those screams you are hearing now on Comm. Ave. aren’t the students. They are the landlords who are undoubtedly rejoicing upon news that the Supreme Judicial Court just issued a major ruling in how student rentals occupancy limits  – indeed all rentals — will be treated by housing inspectors and licensing authorities. This is an important decision which may have far-ranging implications across the state and not just to student housing.

The closely watched case is City of Worcester v. College Hill Properties (download link to case herewhere the SJC has held that renting to 4 or more students in one apartment unit of a two and three family home is not a “lodging house” requiring a special license under the Massachusetts lodging housing law, provided that the apartment meets all other sanitary and building code square footage occupancy thresholds. The state code requires 150 s.f. of living space for the first occupancy and 100 s.f. for each additional person (3 occupants = 350 s.f. of living space), and 70 s.f. of bedroom space for the 1st person, plus 50 s.f. for additional person (120 s.f. for 2 persons in one bedroom). This decision applies state-wide and to every type of rental housing, including multi-families, buildings and townhouses.

The timing of the ruling is interesting in light of the recent fatal fire involving an overcrowded student apartment house in Allston and Mayor Menino’s recent rental property registration and inspection rules.

Court’s Reasoning: Apartments ≠ Lodging Houses

For history buffs, the opinion is fun to read as it traces the Lodging House Law back to the days of brothels, houses of ill-repute and tenements. Using a common-sense analysis, Justice Lenk reasoned that lodging houses, which are essentially temporary rentals of rooms without such amenities as a separate kitchens and bathrooms, are quite different from the modern day apartment units with its more expensive amenities. The court ruled that if an apartment satisfies the state sanitary and building code provisions for the amount of living/sleeping space, utilities, egress, etc., then it would be not be deemed a lodging house despite the number of unrelated occupants.

City of Boston Undergrad Student Rule On the Chopping Block?

In the City of Boston, a new zoning ordinance went into effect in 2008 prohibiting 5 or more undergraduate students from living in one apartment unit. I think it’s a fair statement to say that the College Hill ruling effectively overrules this ordinance.

The other impact of this ruling is we should see an push for even more increased density in apartment rental housing which is exactly what Mayor Menino and the City of Boston doesn’t want.

More Press Coverage:  Banker & Tradesman, Boston Globe, Worcester Telegram

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Richard D. Vetstein is an experienced Greater Boston landlord tenant attorney who represents rental property owners throughout Boston and Massachusetts. You can contact him at 508-620-5352 or at info@vetsteinlawgroup.com.

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Case Highlights Importance of Rent Acceleration Clause In Commercial Leases

In a decision underscoring the importance of careful commercial lease drafting, the Massachusetts Supreme Judicial Court has ruled that a commercial landlord must wait out a 12 year lease term to recover unpaid rent from a tenant who abandoned the premises in year 2 of the lease. We lawyers call this a Pyrrhic victory: “a victory offset by staggering losses.” The case is 275 Washington Street Corp. vs. Hudson River Int’l, LLC (SJC-11217). 

Practice Pointer: This case is an important reminder for all residential and commercial landlords to have their leases reviewed to ensure that they can recover all available lost rental damages. Contact me at info@vetsteinlawgroup.com for a lease review.

Facts: Dental Practice Goes South Quickly

The landlord and tenant, a dental practice, entered into a 12-year lease beginning in 2006 for medical office space located at 221-227 Washington Street in downtown Boston. Barely a year later, the dental practice went under and closed. In May 2008, the dentist told the landlord that he would not be making any further lease payments.

Fortunately, the landlord found a new tenant. A new 10 year lease was signed, covering the remainder of the dentist’s term, but at a lower rent. The landlord sued the dentist for the rent differential — some $1 Million Dollars.

Standard Indemnification Clause

The lease contained a standard default indemnification clause found in many older standard lease forms:

The LESSEE shall indemnify the LESSOR against all loss of rent and other payments which the LESSOR may incur by reason of such termination during the residue of the term.  If the LESSEE shall default, after reasonable notice thereof, in the observance or performance of any conditions or covenant on LESSEE’s part to be observed or performed under or by virtue of any of the provisions in any article of this lease, the LESSOR, without being under any obligation to do so and without thereby waiving such default, may remedy such default for the account and at the expense of the LESSEE.

Common Law Rule: Put It In The Lease

The SJC pointed out long standing Massachusetts common law “where the contract is a commercial lease, our common law does not provide ‘benefit of the bargain’ damages in the event of termination of the lease following a breach. Once a landlord terminates a lease, the tenant is no longer obligated to pay the rent, and, unless the lease otherwise so provides, the landlord is not entitled to posttermination damages.” This may be contrary to common understanding, but it’s the reason why lawyers have developed rent acceleration and liquidated damages provisions for commercial leases.

Despite the urging of the Real Estate Bar Association, which filed a friend-of-the-court brief, the SJC saw no need to alter the harsh common law simply because this particular landlord’s lease failed to provide a proper rent acceleration clause. Justice Gants didn’t mince his words in cautioning commercial landlords to use proper lease provisions:

 A landlord left without an adequate remedy following breach of the lease by a tenant has only itself to blame for entering into a lease that fails to provide such a remedy. We shall not disrupt the settled expectations of leasing parties in order to protect a landlord from the consequences of failing to insist on an adequate remedy in the negotiation of a commercial lease. Nor shall we invite uncertainty as to the availability and scope of a landlord’s remedy for “benefit of the bargain” damages where the contours of such a remedy are not delineated in the lease but left to be determined under the common law.

Solution: Rent Acceleration/Liquidated Damages Clause

The lease in this case appears to be of an older variety and did not contain a rent acceleration/liquidated damage clause. Such a clause provides that upon a rent default, all unpaid rent is due through the end of the lease term as liquidated damages. All commercial leases should contain this type of rent acceleration clause, and I would also recommend a provision enabling the landlord to recoup the cost of expensive tenant build outs where a tenant has defaulted early in the lease term. Contact me at info@vetsteinlawgroup.com for a lease review.

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Richard D. Vetstein, Esq.Richard D. Vetstein, Esq. is an experienced Massachusetts real estate attorney. For more information, please contact him at 508-620-5352 or info@vetsteinlawgroup.com.

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Update:  Registration Extended Until Aug. 31, 2013

The Boston City Council and Mayor Menino’s Office have passed a sweeping new rental property registration and inspection ordinance which is now effective for the year 2013. The new ordinance requires, among other things, that all rental property owners register with the Inspectional Services Department (ISD), and are subject to inspections every 5 years. Details of the new ordinance are summarized below.

Who is covered?

All rental property owners, regardless of state residence, must register their rental properties with ISD. This also includes condominium units which are rented out. Excluded from the inspection requirements (but not the registration requirements) are owner-occupied buildings containing no more than 6 units, licensed lodging houses, government owned or operated housing.

What are my registration obligations?

Landlords are required to register with ISD no later than July 1 of each year. A fee of $25/unit will be charged. All non-resident owners must designate a Boston-based resident agent to accept service of process on the owner’s behalf.  You can now register online at Cityofboston.gov or download an application from the same site. The City has also posted a Frequently Asked Questions Page here.

When will my rental property get inspected?

ISD will inspect rental properties at least once every 5 years. ISD intends to first inspect the “problem” properties which have a history of code violations. Landlords will receive a notice from ISD about the inspection. Landlords have the option of having an outside “authorized inspector” perform the inspection at the owner’s expense. Annual inspections conducted by the Boston Housing Authority (BHA) and similar government programs will be accepted by ISD. For most buildings, the inspection fee is $75 for the first two units, and $50/unit thereafter.

Are there any new signage requirements?

Yes. A sign of not less than 20 square inches must be posted adjacent to the building’s mailboxes or other conspicuous location. The sign must contain the contact information of the landlord and property manager, if any.

My property has been cited for violations in the past. Will this be a problem?

It could be. The new ordinance has a new classification for “Problem Property” if:

  • the police have been called to the property at least 4 times in one year; or
  • 4 or more noise complaints; or
  • 4 or more ISD complaints for unsanitary conditions/code violations

Problem Properties must be inspected every year and the owner must submit a management plan to address the issues.

How do I coordinate the inspection with my tenants?

A tenant is entitled to “reasonable advance notice” before an inspection. If access is denied, the landlord must notify ISD within 7 days, and if ISD verifies same, the landlord will be exempted from inspection for 1 year. Tenants are entitled to a copy of all inspection reports.

I am buying a rental property. By when does the new owner need to register?

ISD must be notified of the sale of any rental property 30 days after the closing, and the new owner must register with ISD within this 30 day window. Within 90 days of closing, the new owner must complete any pending inspection or submit an application for approval of an alternative inspection plan.

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Richard D. Vetstein is an experienced Greater Boston landlord tenant attorney who represents rental property owners throughout Boston and Massachusetts. You can contact him at 508-620-5352 or at info@vetsteinlawgroup.com.

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alg-domestic-violence-illustration-jpgUnder the new Massachusetts Domestic Violence Act recently signed into law, victims of sexual assault and stalking have the right to break their leases without significant financial penalty, have the landlord change their locks, and other important protections. The important provisions of the new law are as follows:

  • In order to break a lease, victims are required to provide notice to landlords that they were subject to a sexual assault or rape or under imminent threat of same within three (3) months of the incident
  • Landlords may request supporting documentation such as a police report or restraining order (which they must keep confidential).
  • Provided the tenant victim provides the proper notice, she will be relieve of financial liability for 30 days or one full rental period of rent, plus a return of any last month’s rent and security deposit.
  • The new law applies to anyone in the renter’s household.
  • Victims of sexual assault or stalking may require that the landlord change the unit’s locks within 48 hours at the tenant’s expense. If the landlord fails to act, the tenant may change the locks herself.
  • If the perpetrator of the sex crime or threat is a household member (i.e., spouse/boyfriend), the landlord may authorize the lock-out the perpetrator by changing the locks and withholding the new key.
  • Landlord’s who comply with the new law are generally absolved from liability to the perpetrator.
  • Noncompliance with the new law can result in damages equal to 3x the rental amount, plus payment of the tenant’s legal fees, which may be set off against any unpaid rent.

The bill, as finally passed, was signed off by both tenant and landlord industry groups, after several years of debate. A link to the new Massachusetts domestic violence law can be found here. 

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RDV-profile-picture-larger-150x150.jpgRichard D. Vetstein, Esq. is a Massachusetts real estate attorney who frequently advises landlords on their legal obligations under Massachusetts landlord and tenant law.

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Ice slip drink

Blizzard Warning Issued For 2/7/13

This post will provide you with frequently asked questions concerning Massachusetts snow and ice removal law.

I am a homeowner and rental property owner. Am I legally required to clear snow and ice after a storm?

The law now in Massachusetts is that all Massachusetts property owners and landlords are legally responsible for the removal of snow and ice from their property. In 2010, the Massachusetts Supreme Judicial Court overruled 125 years of legal precedent which protected property owners from “natural accumulations of ice and snow,” and announced this new rule. My prior post on the case can be read here. The rule applies across the board, to homeowners, landlords, commercial business owners, restaurants, everyone.

I am a landlord. How long do I have to shovel snow and ice on my rental property?

There is no clear cut answer to this question, and juries and courts will ultimately decide what is reasonable. The City of Boston’s policy is to give businesses 3 hours to clean snow, and 6 hours to residents. 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.

My lease states that the tenant is responsible for snow shoveling. Will that protect me from liability?

Probably not. A person 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. The landlord may bring a claim for contribution/indemnification against the tenant.

L_ice_meltI live in Boston, and I heard I have to shovel the public sidewalk in front of my house after a storm. Is that true?

Yes. On top of their added responsibilities, property owners in several Massachusetts communities, including Boston, Cambridge, Newton, Lynn, and Worcester, are required by local ordinances to clear municipal sidewalks in front of their residences or businesses. The City of Boston mandates clean sidewalks within 6 hours of a storm; Worcester is 12 hours.

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.

If you have additional questions, please ask them in the comment forms below!

Resources: City of Cambridge Snow Removal Policy, City of Boston Know Snow Fact Page

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RDV-profile-picture-larger-150x150.jpgRichard D. Vetstein, Esq. is an experienced Massachusetts real estate attorney who advises property owners and landlords as to liability issues. Please contact him at 508-620-5352 or at info@vetsteinlawgroup.com.

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School is back and summer is over. September 1 and the start of the new rental cycle is right around the corner. It’s time to review my best practices to get trouble-free, paying tenants in your Massachusetts rental property.

Screening Prospective Massachusetts Renters: What You Can and Cannot Ask

Landlords can legally ask prospective renters about the following:

  • income and current employment
  • prior landlord references
  • credit history
  • criminal history

Your rental application should include a full release of all credit history and CORI (Criminal Offender Registry Information). Use CORI information with caution, however, and offer the tenant an opportunity to explain any issues. Landlords should also check the Sex Offender Registry as they can be held liable for renting to a known offender. Use the rental application and other forms from the Greater Boston Real Estate Board.

Landlords cannot ask about the following:

  • race, color, national origin, ancestry, or gender
  • sexual orientation
  • age
  • marital status
  • religion
  • military/veteran status
  • disability, receipt of public assistance
  • children.

If you deny a renter’s application, it should be based on financial reasons, such as questionable credit, income or rental history. Stay away from reasons related to children, public assistance and the like. Be aware that this time of year the Massachusetts Commission Against Discrimination and Attorney General’s Office send out dummy rental applicants in an attempt to catch unwary landlords who deny housing for discriminatory reasons.

Students, especially undergraduates, often create problems for landlords. It’s important to meet with students personally before signing the lease and firmly explain a “no tolerance” policy against excessive noise, parties and misbehavior. Remember, under a two year old Boston zoning ordinance, no more than four (4) full time undergraduate students may live together in a single apartment.

Careful screening of tenants is far less expensive than the cost of evicting a problem tenant.

My Property Has Lead Paint. Can I Refuse To Rent to Tenants With Small Kids?

The answer is no, but many landlords do so (unlawfully) under the guise of financial reasons. The Attorney General has been cracking down on these practice:  Two Local Real Estate Firms Fined By Mass. Attorney General For Lead Paint Housing Discrimination.

Under the Massachusetts Lead Paint Law, whenever a child under six years of age comes to live in a rental property, the property owner has a responsibility to discover whether there is any lead paint on the property and to de-lead to protect the young children living there. A property owner or real estate agent cannot get around the legal requirements to disclose information about known lead hazards simply by refusing to rent to families with young children. They also cannot refuse to renew the lease of a pregnant woman or a family with young children just because a property may contain lead hazards. Landlords cannot refuse to rent simply because they do not want to spend the money to de-lead the property. Any of these acts is a violation of the Lead Law, the Consumer Protection Act, and various Massachusetts anti-discrimination statutes that can have serious penalties for a property owner or real estate agent.

For more information about Massachusetts rental screening, landlord-tenant law and evictions, please read these articles or contact me below. I would be happy to help you get good tenants.

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Richard D. Vetstein, Esq. is an experienced Massachusetts real estate and eviction attorney. For more information, please contact him at 508-620-5352 or info@vetsteinlawgroup.com.

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Renter’s Insurance Policy Raises Questions

I’ve recently become aware that some Massachusetts landlords are requiring that tenants procure their own policy of renter’s insurance as a condition of leasing. In fact, MSN Real Estate did a nice write up about the practice here. But I am also hearing about a dark side to this practice where some landlords have a kickback arrangement with the insurance provider where the landlord receives compensation for any policy taken out by a tenant.

Renter’s insurance is almost always a good idea, but under Massachusetts law, can a landlord require that a tenant get a policy (if the tenant doesn’t want one) and must it disclose a referral relationship with the insurance provider?

Landlords Should Be Careful About Renter’s Insurance Requirement

In light of recent court decisions, landlords should re-examine the legality of a mandatory renter’s insurance policy requirement.  In the recent Hermida v. Archstone class action ruling, which considered amenity fees under the Massachusetts security deposit statute, the court held that landlords can only charge first and last month’s rent, a security deposit, and a lost key fee at the beginning of a tenancy, and no other types of fees. Any other type of fee or financial obligation required to be paid by the tenant at the beginning of the lease could be deemed illegal under the Mass. Security Deposit law, Mass. Gen. Laws ch. 186, sec. 15B. Accordingly, landlord must be very careful about what and how much they charge tenants at the inception of leases, over and above the standard rent deposits and new key fee. At the very least, renter’s insurance should be optional, and any affiliate or kickback arrangement should be fully disclosed to the tenant. This still may not prevent a landlord from getting sued over a mandatory renter’s insurance requirement.

Renter’s Insurance Still Smart Choice

That said, I always recommend that tenants get their own renter’s insurance policy. It’s fairly inexpensive and provides protection to your personal belongings. Massachusetts law does provide for a minimum of $750 per unit for tenant relocation assistance due to fire displacement. However, that is not nearly enough for the average renter.

Has your landlord required that you purchase renter’s insurance? Have they disclosed any referral relationship? I’d like to hear from you. The practice may well be illegal.

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Richard D. Vetstein, Esq. is an experienced Massachusetts Real Estate Landlord Attorney. For further information you can contact him at info@vetsteinlawgroup.com.

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Another Expansion Of Massachusetts Landlord Liability

In yet another case demonstrating Massachusetts’ inhospitable legal environment towards residential landlords, Northeast Housing Court Judge David Kerman has ruled that an owner of a mixed used residential – commercial building is “strictly liable” for a drunk tenant’s fall through a defective porch guardrail. The 17-page ruling is Sheehan v. Weaver, and is embedded below. The imposition of strict liability, sometimes called absolute or no-fault liability, makes landlords 100% liable for the injuries of tenants where there is a building code violation, regardless of whether the tenant was equally at fault for the accident. This is a troubling ruling and another reason supporting the notion that Massachusetts is landlord unfriendly!

Faulty Porch Guardrail

The landlord, David Weaver, owned a building with three residential apartments located above a commercial establishment. None of the apartments were owner-occupied. One of Weaver’s residential tenants, William Sheehan, fell through a porch guardrail, several stories onto the asphalt pavement below, suffering serious injuries. There was evidence that Sheehan was intoxicated, however, the connection of the guardrail to its post gave way because it was defective and in violation of the Building Code.

After a four-day trial in the Housing Court, a jury found for the tenant on the negligence claim, awarding approximately $145,000 after a 40% reduction for the plaintiff’s own negligence. The jury also found the landlord strictly liable, assessing $242,000 in damages.

Building Code Violation At Issue

The Massachusetts State Building Code provides for strict (100%) liability for any personal injuries caused by any building code violation at any “place of assembly, theatre, special hall, public hall, factory, workshop, manufacturing establishment or building.” The landlord argued that the primarily residential structure was not sufficiently commercial to be considered a “building” within the meaning of the Building Code’s strict liability provision. But Judge David D. Kerman disagreed:

“[T]he structure in this case may well be at the outer margin of the class of structures that fall within the ambit of the term ‘building’ in the strict liability law,” wrote Kerman. “However, it is my opinion that the mixed residential-commercial four-unit non-owner-occupied structure in this case is ‘commercial’ and ‘public’ enough to fit within the term ‘building’ in section 51.”

The imposition of strict liability resulted in the landlord being hit with the full amount of the $242,000 judgment with no reduction for the tenant’s comparative negligence due to his intoxication. Ouch.

Commentary: Bad Decision

As I stated to Massachusetts Lawyers Weekly, this is a troubling ruling. The Building Code provision, passed in the late 1800′s, was clearly intended to cover structures with a distinctively commercial nature, i.e., “public hall, factory, workshop, manufacturing establishing or building.” The law was not intended to cover a predominantly residential apartment building with commercial/retail on the ground floor, in my opinion.

This ruling will now expand liability for residential developers who have built quite a number of mixed-use residential projects in the last few years. This decision can be read as providing strict liability for anyone injured due to any type of building code violation, however minor. Property managers and commercial insurers should be aware of this ruling, and ensure that there are no building code issues which could cause harm to tenants.

Given the concerning expansion of liability in this case, look for this ruling to get appealed. Judge Kerman is a well-respected judge, and this decision is a close call, but I think he went a bit too far outside the legislative intent behind the law.

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Richard D. Vetstein, Esq. is an experienced Massachusetts real estate attorney. For more information, please contact him at 508-620-5352 or info@vetsteinlawgroup.com.

Sheehan v. Weaver

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Update (5/3/13): SJC Upholds Ruling, Landlords Should Add Rent Acceleration Clause to Leases

Commercial Landlord Must Wait Out 12 Year Lease Term To Recover For Tenant’s Early Termination

In a decision which underscores the importance of careful commercial lease drafting, the Massachusetts Appeals Court has ruled that under a standard form default indemnity provision in a commercial lease, a commercial landlord must wait out the end of a 12 year lease term to recover unpaid rent from a tenant who abandoned the premises in Year 2 of the lease. The practice pointer here is to always have a current acceleration/liquidated damages clause in your commercial lease. See below for some form language.

The case is 275 Washington Street Corp.. vs. Hudson River Int’l, LLC (Mass. Appeals Court March 9, 2012), and is embedded below.

Dental Practice Goes South Quickly

The landlord and tenant entered into a 12-year lease beginning April 13, 2006, and ending April 16, 2018. The premises, located at 221-227 Washington Street in downtown Boston, were intended for use as a dental practice. Within a year of the lease commencement, the dental practice went under and closed. In May 2008, the dentist told the landlord that he would not be making any further lease payments.

Fortunately, the landlord found a new tenant. A new 10 year lease was signed, covering the remainder of the dentist’s term, but at a lower rent. The landlord sued the tenant for the rent differential.

Standard Indemnification Clause

The lease contained a standard default indemnification clause found in many older standard lease forms such as this:

The LESSEE shall indemnify the LESSOR against all loss of rent and other payments which the LESSOR may incur by reason of such termination during the residue of the term.  If the LESSEE shall default, after reasonable notice thereof, in the observance or performance of any conditions or covenant on LESSEE’s part to be observed or performed under or by virtue of any of the provisions in any article of this lease, the LESSOR, without being under any obligation to do so and without thereby waiving such default, may remedy such default for the account and at the expense of the LESSEE.

Indemnity Provision Lacking

The problem is that under Massachusetts law, recovery under an indemnity clause of a lease cannot be had until the specified term of the lease has ended. The reasoning underlying this legal tenet is that such liability is ultimately “contingent upon events thereafter occurring, because the full amount which the lessee eventually must pay for the remainder of the term cannot be wholly ascertained until the period ends.” Although somewhat reluctant, the Court was bound to follow the law in this instance:

We are cognizant of the concerns raised by this long-established rule barring recovery until the end of the original lease, given the possible intervention of factors, presently unknown, that make the determination of damages uncertain at the present. We also recognize the possibility that this rule, which forces this landlord to wait until 2018 to determine post-termination damages, may in effect make it impossible for the landlord to recover its true damages from this corporate tenant or guarantor, because of the protections afforded by legal processes, such as dissolution or bankruptcy. However, given the present state of the law and the specific terms of the contract to which parties of equal bargaining power agreed, we are constrained, nonetheless, to deny recovery to the landlord under the indemnification clause of this lease.

Time To Change The Old Law?

The Appeals Court, especially the concurring opinion of Justice Kantrowitz, suggested that the time may be ripe for the Supreme Judicial Court to re-examine and modernize the law in this area. So look for this case to possibly go up on appeal.

Solution: Acceleration/Liquidated Damages Clause

The lease in this case did not contain the more current acceleration/liquidated damage clause which provides that upon a rent default, all unpaid rent is automatically due through the end of the lease term as liquidated damages. I recommend language such as this to prevent what happened to the landlord in this case:

If LESSEE shall default in the payment of the security deposit, rent, taxes, substantial invoice from LESSOR or LESSOR’s agent for goods and/or services or other sum herein specified, and such default shall continue for ten (10) days after written notice hereof, and, because both parties agree that nonpayment of said sums when due is a substantial breach of the lease, and, because the payment of rent in monthly installments is for the sole benefit and convenience of LESSEE, then in addition to the foregoing remedies the entire balance of rent which is due hereunder shall become immediately due and payable as liquidated damages. The Parties acknowledge and agree that (i) the liquidated damages hereunder is the best estimate of such damages which would accrue to Lessor in the event of Lessee’s default hereunder; (ii) said deposit represents damages and not a penalty against Lessee.

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Richard D. Vetstein, Esq. is an experienced Massachusetts real estate attorney. For more information, please contact him at 508-620-5352 or info@vetsteinlawgroup.com.

275 Washington Street Corp v. Hudson River International LLC (Mass. App. Ct.)

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Federal Judge Rules $475 Apartment Amenity Use Fee Violates Massachusetts Security Deposit Law

Some large apartment owners, such as Archstone Properties, have been charging tenants a separate “amenity use fee” for use of the community pool, workout room, media center and other amenities, or a separate “move-in” fee or pet fee. The fees can be rather hefty; several hundred dollars in many cases. Well, a federal judge recently struck down these fees as illegal under the Massachusetts Security Deposit Law. What’s more, the judge has allowed a class action to proceed against Archstone Reading apartment complex which may be on the hook for thousands if not millions in refunds to tenants. Other apartment complexes may have legal exposure if they used similar amenity use fees.

Massachusetts Amenity Fee Class Action

The case is Hermida v. Archstone Properties (D. Mass. Nov. 29, 2011). The case arose out of a $475 amenity use fee charged by Archstone Properties in their Reading, Massachusetts apartment complex. The judge ruled that under Massachusetts law, landlords can only charge tenants for: (1) first month’s rent, (2) last month’s rent, (3) a security deposit, and (4) a key installation fee. The additional amenity use fee is illegal, Judge Young ruled, if it is required, not optional, and charged up front, i.e, a condition to renting. Judge Young also approved the case for class action status.

The class action attorney handling the case, Matthew Fogelman, Esq., is also investigating whether other apartment complexes and landlords have charged similar amenity use fees, move in fees and/or pet fees, for potential class actions against those apartment complexes. If you were ever charged a separate amenity use fee, move-in fee, or pet fee as part of your rental lease, please email me at info@vetsteinlawgroup.com and I will put you in contact with the case attorney. You could be entitled to a refund of several hundred dollars and possibly additional compensation.

Alert: Property managers are asking tenants to sign releases to get a refund of their amenity use fees. DO NOT SIGN ANY RELEASE OR WAIVER FORM UNTIL YOU HAVE CONSULTED WITH AN ATTORNEY. YOU COULD BE WAIVING YOUR RIGHT TO COLLECT THE MAXIMUM AMOUNT OF COMPENSATION.

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Richard D. Vetstein, Esq. is an experienced Massachusetts Real Estate Litigation Attorney who has litigated hundreds of cases in the Massachusetts Land and Superior Courts. For further information you can contact him at info@vetsteinlawgroup.com.

This post may be considered “attorney advertising.”

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brownstone1.jpgBuying a condominium unit can be more involved than buying a single family home. This is because you have to worry about both the unit itself and the condominium project as a whole.

10 Questions You Must Ask Before Purchasing A Condominium Unit

To borrow from a famous phrase, not all condominiums are created equally. Some condominiums are very well run; some are quite poorly run and underfunded. Buyers interested in purchasing a condominium unit must do their homework:  not only about the condition of the individual unit they are interested in purchasing, but on the financial health and governance of the condominium as a whole. Remember, you are buying into the entire project as much as you are the unit, and your decision will impact your daily living and your ability to re-sell.

Here are the 10 questions buyers should ask when deciding to purchase a condominium unit:

  1. What is the monthly condominium fee and what does it pay for? The monthly condominium fee can range quite dramatically from condominium to condominium. The fee is a by-product of the number of units, the annual expenses to maintain the common area, whether the condo is professionally managed or self-managed, the age and condition of the project, and other variables such as litigation. For budgeting and financing you need to know the monthly fee and exactly what you are getting for it.
  2. What are the condominium rules & regulations? Condominium rules can prohibit pets, your ability to rent out the unit, and perform renovations. Make sure you carefully review the rules and regulations before buying.  Needless to say, the buyer’s attorney should review and approval all condominium documents, including the master deed, declaration of trust/by-laws, covenants, unit deed and floor plans to ensure compliance with state condominium laws as well as Fannie Mae and FHA guidelines, as necessary.
  3. How much money is in the capital reserve account and how much is funded annually? The capital reserve fund is like an insurance policy for the inevitable capital repairs every building requires. As a general rule, the fund should contain at least 10% of the annual revenue budget, and in the case of older projects, even more. If the capital reserve account is poorly funded, there is a higher risk of a special assessment.  Get a copy of the last 2 years budget, the current reserve account funding level and any capital reserve study.
  4. Are there any contemplated or pending special assessments? Special assessments are one time fees for capital improvements payable by every unit owner. Some special assessments can run in the thousands, others like the Boston Harbor Towers $75 Million renovation project, in the millions. You need to be aware if you are buying a special assessment along with your unit.  It’s a good idea to ask for the last 2 years of condominium meeting minutes to check what’s been going on with the condomininium.
  5. Is there a professional management company or is the association self-managed? Usually, a professional management company, while an added cost, can add great value to a condominium with well run governance and management of common areas. But for smaller condominiums, self-management works just fine.
  6. Is the condominium involved in any pending legal actions? Legal disputes between owners, with developers or with the association can signal trouble and a poorly run organization. Legal action equals attorneys’ fees which are payable out of the condominium budget and could result in a special assessment.  In some states, you can run a search of the condominium association in the court database to check if they’ve been involved in recent lawsuits.
  7. How many units are owner occupied? A large percentage of renters can create unwanted noise and neighbor issues. It can also raise re-sale and financing  issues with the new Fannie Mae and FHA condominium regulations which limit owner-occupancy rates. If your buyer is using conventional financing, check if it is a Fannie Mae approved condo. If FHA financing, check if it’s an FHA approved condo. (Thanks mortgage specialist Lou Corcoran for the links)
  8. What is the condominium fee delinquency rate? Again, a signal of financial trouble, and Fannie Mae and FHA want to see the rate at 15% or less.
  9. Do unit owners have exclusive easements or right to use certain common areas such as porches, decks, storage spaces and parking spaces? Condominiums differ as to how they structure the “ownership” of certain amenities such as roof decks, porches, storage spaces and parking spaces. Sometimes, they are truly “deeded” with the unit, so the unit owner has sole responsibility for maintenance and repairs. Sometimes, they are common areas in which the unit owner has the exclusive right to use, but the maintenance and repair is left with the association.  Review the Master Deed and Unit Deed on this one.
  10. What Does The Master Insurance Policy Cover? The condominium should have up to $1M or more in coverage under their master condominium policy. For buyer’s own protection, they should always buy an individual HO-6 policy covering the interior and contents of the unit, because the master policy and condo by-laws may not cover all damage to their personal possessions and interior damage in case of a roof leak, water pipe burst or other problem arising from a common area element. Ask for a copy of the master insurance policy and don’t forget to check the fine print of the by-laws. Sometimes, there’s language that would hurt a unit owner in case of a common area casualty. Condominiums over 20 units should also have fidelity insurance to protect against embezzlement.

I posted this list on the Realtor ActiveRain website and it was the featured post, generating a slew of great comments from real estate brokers around the country.

Of course, a good real estate attorney will help buyers and their realtors with this “due diligence.” As part of our standard condominium representation, we will review the following condominium documents and issues:

  • Master Deed and amendments
  • Declaration of Trust/By-Laws, Rules & Regulations
  • HOA Covenants/Restrictions
  • Unit Deed and Floor Plans
  • Condominium Budget and Capital Reserve Fund
  • Fannie Mae/FHA Compliance Provisions
  • Condominium Annual and Special Meeting Minutes
  • Pending or Contemplated Special Assessments or Litigation

We will also build in provisions into your purchase and sale agreement to protect you in case there are unanticipated or undisclosed issues with the condominium which affect your willingness to move forward with the transaction. Happy condo hunting!

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istock_000008947813xsmall-300x223.jpgWith the impending influx of renters and students invading the Greater Boston area soon, let’s review some often asked questions concerning Massachusetts landlord tenant law to assist landlords in navigating the rental process.

Screening Prospective Tenants: What You Can and Cannot Ask?

Landlords can legally ask about a tenant’s income, current employment, prior landlord references, credit history, and criminal history. Your rental application should include a full release of all credit history and CORI (Criminal Offender Registry Information).  Use CORI information with a great deal of caution, however, and offer the tenant an opportunity to explain any issues. Landlords should also check the Sex Offender Registry as they can be held liable for renting to a known offender. Use the rental application and other forms from the Greater Boston Real Estate Board.

Under Massachusetts discrimination laws, a landlord cannot refuse to rent to a tenant on the basis of the tenant’s race, color, national origin, ancestry, gender, sexual orientation, age, marital status, religion, military/veteran status, disability, receipt of public assistance, and children. It’s best to stay away from asking about these topics.

Students, especially undergraduates, often create problems for landlords. Meet with students personally before signing the lease and firmly explain a “no tolerance” policy against excessive noise, parties and misbehavior.

Careful screening of tenants is far less expensive than the cost of evicting a problem tenant.

Security And Last Month’s Rent Deposits:  Should I Take One?

I advise landlords not to take security deposits because any misstep, however innocent, under the complex Massachusetts security deposit law can subject the landlord to far greater liability than the deposit. Among other requirements, the security deposit law provides:

  • a landlord must give the tenant a written receipt with information as to where the deposit is being held;
  • a landlord must hold a security deposit in a separate interest bearing account, and pay interest to the tenant yearly;
  • at the beginning of the tenancy, a landlord must provide the tenant with a written “statement of condition” of the rental unit detailing its condition and any damage;
  • the tenant may note any damage on the statement of condition
  • At the end of the tenancy, if the landlord desires to deduct repair costs from the security deposit, it must provide the tenant with written notification and copies of all estimates within 30 days of the tenant’s move-out.

Under the law, any slip-up on these requirements can subject the landlord to liability for 3 times the deposit plus the tenant’s attorneys’ fees. That’s why I advise my landlord clients that security deposits aren’t worth the money. If you need a deposit, take a last month’s deposit, the requirements of which can be found here in the Massachusetts last month’s deposit law.

Due to the high interest in security deposits, I wrote a full post on the topic.  Click on Massachusetts Security Deposits to view the article.

My Property Has Lead Paint, What Do I Do?

Under the Massachusetts Lead Paint Law, landlords (and real estate agents) must disclose to tenants the presence of known lead paint for property built before 1978. The property must be de-leaded if a child under 6 will live there. That means if a young couple moves into a unit, then has a baby, the landlord must de-lead the property. There is no way around de-leading other than risking a discrimination claim for not renting to families with small children which is illegal. (Of course, many landlords unlawfully reject families with children). Exposing children to lead paint puts a landlord at huge legal risk.  Financial aid and tax credits for de-leading are available to qualified property owners. For all Massachusetts rental property built before 1978, landlords must provide all tenants regardless of family composition with a Massachusetts Tenant Notification and Certification form, and all lead inspection reports and testing information, if available.

Can I Take A Finder’s Fee?

Only a licensed real estate broker can lawfully collect a finder’s fee for bringing together a landlord and a tenant.  Landlords who don’t work with brokers cannot charge a finder’s fee.

For more information, I recommend reading the Landlord’s Guide To the Law by the Massachusetts Attorney General’s Office.

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Richard D. Vetstein, Esq. is an experienced Massachusetts landlord tenant and eviction attorney. Please contact him with any questions.

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