The mortgage is due, the plumber wants to get paid, and your property manager needs a check for the monthly management fee. But your tenants are not paying their rent, and there is not a damn thing you can do about it. At least for now.
Minnesota and North Dakota have both, effectively, placed a temporary moratorium on evictions. There has been a lot of confusion over what that means, and what rights tenants and landlords have moving forward. There are some important distinctions between landlord-tenant law in Minnesota and North Dakota. But, at least, generally speaking, the implications of the ban on evictions is largely the same. Rent is still due and will continue to be due. Eviction actions, however, are on hold.
In North Dakota, the eviction process typically includes (1) service of a three-day notice of intent to evict; (2) issuance and service of a summons and complaint; and (3) a summary hearing in district court. Under the current moratorium, landlords may still issue a three-day notice of intention to evict, but in most cases, the courts will not issue a summons or set a time for a hearing. At this point, landlords will see two primary benefits of serving the three-day notice. First, it will cut a few days off the process when the courts do eventually open for evictions. Second, it makes sure your tenant knows that you are taking whatever problem may exist seriously. With a little luck, the three-day notice may be enough to spur action from your tenant and help avoid the eviction process altogether. Although in light of several articles recently run in the local media, landlords should also consider the possibility of negative press.
It is important to note that eviction hearings will not be scheduled in most cases. North Dakota’s Supreme Court did leave some wiggle room when putting the eviction moratorium in place. Specifically, the Court allowed parties to request an exception to the moratorium when a party has proper “cause” to do so. What does that mean? Nobody really knows and the court hasn’t issued extensive interpretations of the order. To this point, most requests for an exception to the moratorium are not based solely on a tenant’s inability to pay rent. Rather, they typically involve serious and on-going violence. One recent request to the Cass County District Court detailed an individual patrolling a small apartment complex as if it were a military base, and violently beating and intimidating his “friends” and neighbors. It seems this type of scenario is sufficient cause for the courts to allow an exception to the eviction moratorium – but simple failure to pay rent is unlikely to result in a hearing for the time being.
Absent an extreme situation, the courts are unlikely to be open for eviction proceedings any time soon. When they do open, scheduling will be a nightmare. If your tenants aren’t paying rent, now more than ever is the time to consider payment plans or other arrangements to help keep both the landlord and tenant afloat. It takes two to tango. If landlords and tenants are unwilling or unable to work together, the landlords will go without the revenue they need to care for their properties, and tenants will accumulate large debts, eventually resulting in eviction; a lose-lose scenario.
We are living in strange times. Cooperation and mutually beneficial agreements will not always be possible between landlords and tenants. But, to the extent an agreement might be possible, it should be explored. Don’t let great be the enemy of good.
Tyler Leverington is a business and litigation attorney at Ohnstad Twichell, who works hand in hand with clients in a host of industries including real estate, technology, manufacturing, media, and others. Call Tyler for all your business transactional and litigation needs.