Landlord sued for attempting to collect rent on foreclosed property

Posted on February 23rd, 2014 in evictions,Foreclosure by ohiolandlordtenant

Horton Properties, LLC and Sheryl and Richard Horton brought an eviction action against Thad Bailey and Todd Bradley in approximately July 2012. Eviction actions are typically relatively run of the mill affairs, and tenants rarely show up at court to fight them. Fewer still file an answer to an eviction complaint. Even fewer file a counterclaim against their landlords alleging that the landlords entered into rental agreements with the tenants; attempted to collect rents after doing so; undertook a systematic and ongoing campaign of harassment against the tenants demanding rent, demanding increased rent, and fraudulently collecting rents; and filing an eviction action against the tenants.

These all seem like perfectly legal practices for a landlord to engage in except that the tenants allege that the landlord engaged in them after the landlord had lost the property in foreclosure. You read that right. Horton Properties, LLC, Sheryl Horton and Richard Horton are alleged to have entered into lease agreements, collected rent, demanded rent, harassed tenants for rent, and filed evictions for property that they no longer legally owned.

The tenant’s counterclaim alleges that 3096 Northwest Boulevard in Upper Arlington, Ohio was/is the subject of foreclosure litigation in the Franklin County Common Pleas Court (Case no. 09CVE012529). A review of Franklin County Common Pleas Court records reveals that a default judgment in the foreclosure case was entered against Horton Properties, Sheryl Horton and Richard Horton on October 1, 2009 (almost three years prior to the eviction action being filed against the tenants by the Hortons).

A further review of the court record in the foreclosure case reveals that the court confirmed the sale of the property in question on April 26, 2012. According to that document, the sheriff’s sale occurred on February 10, 2012.

A timeline created from court records provides the following sequence of events:

Aug. 19, 2009 – Foreclosure action filed by US Bank v. the Hortons;
Oct. 1, 2009 – Court enters default judgment against the Hortons as they failed to defend;
Feb. 10, 2012 – Foreclosed property is finally sold at the last of several sheriff’s sales;
March 10, 2012 – Last day for Hortons to redeem the property;
April 26, 2012 – Common Pleas Court enters entry confirming sheriff’s sale;
July 2012 – Hortons file eviction action against tenants who were residing at foreclosed property.

It seems like a question would have been raised in the mind of a landlord on or about Oct. 1, 2009 concerning ownership of the rental property when the court entered default judgment against the landlord. If not, the numerous notices of sheriff’s sales may have been cause for concern. At the very least, the court’s confirmation of the sheriff’s sale might have given some pause to a landlord that perhaps this property no longer belonged to him and that filing an eviction action against tenants at the foreclosed property would have been a poor decision. Now the landlord faces counterclaims for unlawful evictions; harassment; fraudulently collecting rents; and more.

It seems like a rare case but tenants should attempt to determine whether a landlord truly owns the rental property in cases where a foreclosure action may be pending. If a court confirms a sheriff’s sale regarding the rental property, a landlord’s right to collect rent, perform evictions, enter into lease agreements, threaten eviction has been terminated. More importantly, a tenant may have grounds for a suit alleging fraud, engaging in an illegal self-help eviction, as well as harassment against the former landlord.

Award of Attorneys Fees Mandatory when Landlord Engages in Self Help Eviction on Residential Property

Posted on June 23rd, 2013 in evictions by Eric

Ohio law makes it illegal for a landlord to throw a residential tenant out of his or her apartment without going through the statutory eviction process as outlined in Ohio Revised Code section 1923.04. Thus R.C. 5321.15 provides:

(A) No landlord of residential premises shall initiate any act, including termination of utilities or services, exclusion from the premises, or threat of any unlawful act, against a tenant, or a tenant whose right to possession has terminated, for the purpose of recovering possession of residential premises, other than as provided in Chapters 1923., 5303., and 5321. Of the Revised Code.

(B) No landlord of residential premises shall seize the furnishings or possessions of a tenant, or of a tenant whose right to possession has terminated, for the purpose of recovering rent payments, other than in accordance with an order issued by a court of competent jurisdiction.

(C) A landlord who violates this section is liable in a civil action for all damages caused to a tenant, or to a tenant whose right to possession has terminated, together with reasonable attorney fees.

In the case of Gaitawe v. Mays, 2012 Ohio 4749, the trial court ruled that the landlords violated R.C. 5321.15, finding that they did not have legal authority to remove Defendant’s belongings or change the locks” to the house. But the trial court refused to grant the tenant’s request for attorney fees because it found that the tenant was not a particularly credible witness.

Ohio’s Second District Court of Appeals held that several Ohio appellate courts have found that when a landlord violates R.C. 5321.15(A) or (B), R.C. 5321.15(C) mandates the award of reasonable attorney fees:

“‘Pursuant to R.C. 5321.15(C), a landlord is liable for the necessary legal fees incurred by a tenant who seeks legal redress for a landlord’s violation of R.C. Chapter 5321.’” Crenshaw v. Rowland, 196 Ohio App.3d 717, 2011 Ohio 5942, 965 N.E.2d 341, ¶ 13 (6th Dist.), quoting Thomas v. Papadelis, 16 Ohio App.3d 359, 360, 16 Ohio B. 413, 476 N.E.2d 726 (9th Dist.1984). Accord, Filyo v. Cannon, Fifth Dist. No. 95 CA 1, 1995 Ohio App. LEXIS 6085, 1995 WL 776946 (Dec. 21, 1995); Ingram v. Glaser, 2d Dist. No. CA 12235, 1991 Ohio App. LEXIS 916, 1991 WL 30227 (Mar. 6, 1991).

In fact, even when a tenant has actually incurred no out-of-pocket attorney fees, the amount of fees determined to be proper should be awarded directly to the attorney or organization that provided the legal services. Lewis v. Romans, 70 Ohio App.2d 7, 433 N.E.2d 622 (1980).

The trial court also supported its decision not to award attorney fees to the tenant with the fact that the tenant provided no evidence at trial as to what her attorneys fees were. But the Second District Court of Appeals overruled that as well, stating that the the Ohio Supreme Court has held that “[a]ttorney fees awards made pursuant to R.C. 5321.16(C) are to be assessed as costs.” Christie v. GMS Management Co., Inc., 88 Ohio St.3d 376, 2000 Ohio 351, 726 N.E.2d 497 (2000), syllabus.

The Supreme Court reasoned that under common law attorney fees were in the nature of costs rather than damages. Id. at 378, citing Beacon Journal Publishing Co. v. Ohio Dept. Of Health, 51 Ohio St.3d 1, 3, 553 N.E.2d 1345 (1990). Furthermore when a statute authorizes the award of attorney fees, it does so by allowing the fees to be taxed as costs rather than awarding the fees as damages. Id., citing Beacon, at 3; Sorin v. Warrensville Hts. School Dist. Bd. of Edn., 46 Ohio St.2d 177, 179, 347 N.E.2d 527 (1976); State ex rel. Michaels v. Morse, 165 Ohio St. 599, 607, 138 N.E.2d 660 (1956). Finally, the Court noted that the legislature could have expressly stated that attorney fees are recoverable as damages, and absent express language to that effect, “we are unwilling to depart from our long-standing practice of treating statutorily authorized attorney fees as costs.” Id. We see no logical reason for attorney fees awarded in actions under R.C. 5321.15 to be handled differently than those awarded under R.C. 5321.16.

Because attorney fees are assessed as costs rather than as damages, a tenant is not required to offer evidence of the amount of those attorney fees at trial. Berlinger v. Suburban Apartment Management Co., 7 Ohio App.3d 122, 126, 7 Ohio B. 155, 454 N.E.2d 1367 (8th Dist.1982). Ohio’s Second District Court of Appeals concluded that an evidentiary hearing may be held to determine the reasonable amount of attorney fees to be awarded following a judgment finding that the tenant is entitled to attorney fees.

If my Tenant Complains at the Eviction Hearing about Needed Repairs, Will that be a Defense to My Eviction Action?

Posted on March 26th, 2013 in evictions by Eric

In Ohio, if the tenant is in breach of the lease agreement, especially for unpaid rent, there are very few defenses to a landlord’s cause of action for eviction. If the tenant complains at the hearing that the landlord is not fixing things around the rented premises, then most Magistrates or Judges are going to ask the tenant whether or not the tenant escrowed the rent under Ohio Revised Code Section 5321.07. Most tenants will answer this question in the negative, explaining that they did not know that this was a remedy available to them.

The Magistrate or Judge will then explain that the landlord’s failure to fix things around the apartment is not a defense to the eviction action, and that the proper thing for the tenant to have done was to escrow the rent money with the court pursuant to Ohio Revised Code Section 5321.05. If the tenant has no other defenses to the eviction, then the eviction should be able to proceed.

The only way that the landlord’s failure to fix things around the apartment could be seen as a defense to the eviction action would be if the failure to fix somehow made it impossible for the tenant to pay rent. The tenant could argue that since an eviction is an equitable remedy, the landlord must come to the court with “clean hands” meaning that his own conduct must not be the cause of the problem of which he complains. Perhaps the tenant complained to the landlord that the lock on the backdoor was old and was no longer working and that the home was insecure. Perhaps the tenant provides evidence that the landlord ignored this problem. Perhaps the tenant then provides evidence via a police report that someone slipped in through the backdoor while the tenant was at work and stole the tenant’s paycheck, checkbook, and $300.00 in cash from a drawer in the kitchen. A judge in Ohio could find that this is a defense to the eviction, because the landlord’s conduct in failing to fix the lock caused the problem of which the landlord now complains.

Tenants Still Responsible For Rent Through End of Lease Term After Eviction

Posted on March 19th, 2013 in evictions,Uncategorized by Eric

Ohio’s Twelfth District Court of Appeals reversed the Fairfield Municipal Court’s ruling in which the lower court did not award unpaid rent through the end of the lease term after the tenants were evicted for having an unauthorized dog on the property. The Twelfth District Court held that though courts in Ohio used to be split on the issue of whether or not the landlord’s filing of an eviction constituted an election of remedies (meaning that the landlord could not both evict and collect unpaid rent), this issue was settled in the year 2000 by the Ohio Supreme Court. In the case of Dennis v. Morgan (2000), 89 Ohio St.3d 417, the Ohio Supreme Court held that when a landlord issues a notice to vacate because of a lease violation or pursues eviction, the tenant who violated the terms of the lease is liable for the unpaid rents until either the expiration of the lease, or until the premises are re-rented.

The Twelfth District Court of Appeals did note however that the ruling in Dennis quoted above did not end the issues in the case before it. The landlord, upon having its lease breached, did still have a duty to mitigate its damages. This means that the landlord cannot just sit back in his easy chair, comfortable in the knowledge that there are still seven months to go on the lease agreement and that he will get that rent in a judgment against the tenant. Rather, the landlord in that situation would be wise to show the court evidence that he has been taking reasonable steps to re-rent the apartment to some new tenant.

The case above is Pinnacle Mgmt. v. Bell, 2012 Ohio 1595.

If you are a landlord and you need help with an eviction, you can call Eric E. Willison at 614.580.4316 or Andrew J. Ruzicho at 614.447.2365 or you can find more information about landlord tenant law at out website at www.ohiolandlordtenant.com.

How Long Does An Eviction Take in Ohio?

Posted on February 26th, 2013 in Eviction attorneys,evictions by Eric

The quick answer is about a month or perhaps less. The process starts with a breach of the lease agreement, and then goes on to the posting of the three day notice. After the three days are up, then the landlord can file the eviction with the court. The court will then set the matter for a hearing. That generally is set two to three weeks out from the date of filing.

At the hearing, the tenant may request a continuance, and will often be given one continuance of about a week. Once the hearing is held, and if the landlord wins possession at the hearing, the landlord will want to apply for a writ of restitution, and that will generally give the tenant a set number of days, as few as 3 or as much as 9 or 10 or even a few more, to get out.

If the tenant still is not out after the deadline shown on the writ, then the landlord will want to set up a praecipe for set out with the bailiff, and depending upon the bailiff’s schedule, that may take a few days.

So if you have a tenant who says he will tie you up in eviction court for six months getting him out, don’t argue with him, just get the eviction process rolling, either doing it yourself or by hiring an attorney.

If you need help with an eviction, you can call either Andy Ruzicho at 614.447.2365 or Eric E. Willison at 614.580.4316. Or you can visit our website at www.ohiolandlordtenant.com

Can I proceed with an eviction if I don’t have a written lease?

Posted on February 12th, 2013 in evictions by ohiolandlordtenant

A frequent question on this blog that arises is whether a landlord can proceed with an eviction if no written lease exists. Sometimes tenants move in and fail to sign a written lease left with them or in other instances, the parties proceed with just a verbal lease. Many landlords operate under the belief that they cannot evict the tenants without a written lease in place.

Landlords can proceed with an eviction without having a written lease as long as the tenants have breached the verbal lease in some manner. A basic verbal lease would be an agreement to rent the premises for a certain amount to be paid on or before a certain day of the month. If the tenants failed to pay rent according to the terms of that verbal lease agreement then the landlord can proceed with an eviction action even in the absence of a written lease.

While a written lease is often preferable, a landlord still has a legal right to proceed with an eviction in situations where only a verbal lease exists between the parties.

Ohio Eviction Notice Does Not Have to be Signed by Landlord

Posted on February 11th, 2013 in evictions,Ohio 3 day notice by ohiolandlordtenant

Tenants generally make the mistake when contesting evictions of seizing upon any discrepancy in the lease, eviction notice or other paperwork and attempting to use that as a defense. A popular notion is that if the landlord or property manager failed to sign the three day eviction notice then that somehow serves as a defense to the eviction. Ohio Revised Code section 1923.04 governs the Ohio eviction notice and there is no requirement within that section that the landlord sign the three day eviction notice for it to be effective. I often type in the landlord’s name at the bottom of the eviction notice in lieu of obtaining a signature.

1923.04 simply requires that -

A party desiring to commence an action under this chapter shall notify the adverse party to leave the premises, for the possession of which the action is about to be brought, three or more days before beginning the action, by certified mail, return receipt requested, or by handing a written copy of the notice to the defendant in person, or by leaving it at his usual place of abode or at the premises from which the defendant is sought to be evicted.

Every notice given under this section by a landlord to recover residential premises shall contain the following language printed or written in a conspicuous manner: “You are being asked to leave the premises. If you do not leave, an eviction action may be initiated against you. If you are in doubt regarding your legal rights and obligations as a tenant, it is recommended that you seek legal assistance.”

Those are the basic and legal requirement of the Ohio three day eviction notice.

Evictions and Oral and Written Leases

Posted on February 6th, 2013 in evictions,lease by Eric

Some tenants are under the mistaken impression that if they do not have a lease in writing, or if the lease in writing that they had with the landlord has expired, then they cannot be evicted. Some landlords wonder how they can evict someone if they do not have a written lease agreement with that person.

To clear up these misconceptions, you should know that a lease for residential rented premises can arise in three ways in Ohio. First, there can be the good old fashioned written lease agreement.

Second, the landlord and the tenant can have an oral lease agreement. The only difficulty with an oral lease agreement is that it is sometimes hard to prove its exact terms. But showing the court that the rent under the oral lease agreement was $500.00 per month and payable on the first of the month usually isn’t too hard because the landlord can often simply show the court the checks that the tenant has written in the past.

The third way for a lease agreement to arise is through implication. Let’s say that you had a written lease agreement that expired three years ago and the tenant went on paying you rent every month and you went on accepting it without protest. The actions of the parties would imply an offer, acceptance, and consideration, all the elements of a contract in the state of Ohio.

Civil Rule 10(d) does state that if you are suing on a written contract, you must either attach a copy of that contract to the lawsuit, or an explanation of why you are not doing so (perhaps you lost the lease agreement or your dog ate it). But so long as you explain in your eviction action that the lease is oral or arising by implication, then the fact that you don’t have a written lease will not stop you from evicting a tenant who has stopped paying rent.

Eviction on land installment contract requires 10 day notice

Posted on January 30th, 2013 in evictions,land contract by ohiolandlordtenant

Under Ohio law, a seller of property via a land installment contract can evict the buyer if the buyer has not paid in accordance with the terms of the contract for a period of five years or more from the date of the first payment or has not paid toward the purchase price a total sum equal to or in excess of twenty per cent thereof. If the buyer has paid in accordance with the terms of the contract for a period of five years or more or has paid 20% of the principal or more, then the seller has to proceed with a foreclosure action instead of an eviction action.

If, as a seller, you do meet the requirements for proceeding with an eviction, then proceeding with an eviction on a land contract is quite a bit different than doing so on a lease agreement. A seller cannot enforce the forfeiture of a buyer’s interest until 30 days after the buyer defaults in payment:

When the vendee of a land installment contract defaults in payment, forfeiture of the interest of the vendee under the contract may be enforced only after the expiration of thirty days from the date of the default. A vendee in default may, prior to the expiration of the thirty-day period, avoid the forfeiture of his interest under the contract by making all payments currently due under the contract and by paying any fees or charges for which he is liable under the contract. If such payments are made within the thirty-day period, forfeiture of the interest of the vendee shall not be enforced.

In other words, if a payment is due on the first and the buyer misses it, the seller cannot do anything until 30 days have passed. During that 30 day time period, the buyer can redeem his interest by paying what is currently due plus fees and charges as per the contract. If the seller waits 30 days and the buyer does not pay then the seller can/must post a 10 day notice on the property and not a 3 day notice. The 10 day notice must identify the property and the land contract; specify the terms and conditions of the contract that have been broken; must notify the buyer that the contract will stand forfeited unless the buyer performs the terms and conditions of the contract within ten days of the completed service of notice and notifies the buyer to leave the premises.

Sellers/landlords can fall into a trap by believing that a standard 3 day eviction notice will serve the purpose in cases involving land contracts.

Tenant’s Vacating Premises Requires Dismissal of Forcible Entry and Detainer Action

Posted on January 27th, 2013 in evictions by Eric

Courts in Ohio have two sorts of powers. They have legal power (the power to make rulings on who owes what to whom) and equitable powers (the power to tell someone to do or not do a thing and to punish the person who does not obey. In the case of an eviction, the Court is using its equitable powers, because the Court is ordering someone to vacate the rented premises.

But Courts of Equity will not make rulings where the issue becomes moot. If a tenant moves out of the apartment and tells this to the Court at the possession hearing, most judges will note on the record that the tenant testified he/she moved out and that any property left behind is abandoned and will dismiss the possession cause. As Ohio’s Tenth District Court of Appeals held in Pingue v. Soos, 1991 Ohio App. LEXIS 5863 (December 5, 1991) unreported.

“Defendants are correct in their assertions that the referee’s recommendation that a writ of restitution be issued is improper. In view of the finding that defendants are no longer in physical possession of the premises, there is no basis or reason for issuing a writ of restitution. Plaintiffs have been restored to possession of the premises. Any claim for eviction in forcible entry and detainer is moot.”