CLARK BARS UPDATE - SEPTEMBER 2nd 2020
Clark & Walker, P.C. - Attorneys at Law
Date: September 2, 2020
COVID-19 - CDC SEEKS TO TEMPORARILY HALT ALL FINANCIAL EVICTIONS IN THE UNITED STATES
By: Christopher R. Walker
Dear Client(s):
At 4:15 p.m. today, September 1, 2020, the U.S. Centers for Disease Control and Prevention (CDC) filed an
order in the Federal Register to temporarily halt residential evictions to prevent the further spread of COVID-19 (hereinafter “Order”). The order provides that “a landlord, owners of a residential property, or other person with a legal right to pursue eviction or possession action” may not “evict” a covered person from any residential property from the date of the order through December 31, 2020 for matters related to non-payment of rent. For the purposes of the Order “other person” includes corporations, companies, associations, firms, partnerships, societies, and joint stock companies, as well as individuals.”
Pursuant to the Order, the CDC believes the continuation of evictions will lead to the further spread of COVID-19 based on skewed reports concerning the number of people at risk of eviction and flawed logic that evictions lead to homelessness. As this matter has been overly politicized, the administration is seeking to appease the masses with this order which allows tenants to stop paying their rent without consequence for the duration of the order.
The Order provides that a “Covered person” may avoid their eviction from their dwelling for the non payment of rent provided they meet the following criteria:
1. The individual has used best efforts to obtain all available government assistance for rent or housing;
2. The individual either (i) expects to earn no more than $99,000 in annual income for Calendar Year 2020 (or no more than $198,000 if filing a joint tax return), (ii) was not required to report any income in 2019 to the U.S. Internal Revenue Service, or (iii) received an Economic Impact Payment (stimulus check) pursuant to Section 2201 of the CARES Act.;
3. The individual is unable to pay the full rent or make a full housing payment due to substantial loss of household income, loss of compensable hours of work or wages, a lay-off, or extraordinary out-of-pocket medical expenses (defined as exceeding 7.5% of one’s adjusted gross income for the year);
4. The individual is using best efforts to make timely partial payments that are as close to the full payment as the individual’s circumstances may permit, taking into account other nondiscretionary expenses; and
5. Eviction would likely render the individual homeless or force the individual to move into and live in close quarters in a new congregate or shared living setting because the individual has no other available housing options.
A tenant seeking to invoke the relief authorized in the Order a tenant must file an attestation with their landlord in the form similar to the form provided for in the Order. If a tenant meets the criteria set forth above a landlord cannot “evict” the tenant from the dwelling unit for non-payment of rent. The administration has warned renters could be "prosecuted, go to jail, or pay a fine" if they lie or mislead in their declarations.
At this time, there is little to no guidance on this Order. The Order appears to grossly offend the constitution and seems to be a far reaching overstep by the Executive Branch into the duties constitutionally delegated to the Legislative Branch. While we anticipate there will be litigation over this in the foreseeable future we are left with trying to interpret this Order and act in compliance with is onerous terms. With that said, we have come up with the following preliminary guidance:
1. Landlords with right to commence eviction proceedings should do so. This means file your eviction cases for your non-payment of rent cases;
2. If your tenant provides you with the attestation required by the Order you must stop all proceedings and contact your legal counsel;
3. Do no proceed with the issuance of a writ of restitution if the tenant provides any form that purports to be an attestation under the Order.
Please remember, the Order relates only to a temporary halt on the commencement of evictions for non-payment of rent and, unlike the CARES Act, applies to all landlords equally. The guidance listed above is our preliminary response to the Order and may change as this matter further develops and/or guidance is provided by the CDC.
If you have any questions or concerns you should immediately reach out to your legal counsel.
Clark & Walker, P.C. - Attorneys at Law
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