What to Know Regarding the Moratorium on Evictions During COVID-19

What to Know Regarding the Moratorium on Evictions During COVID-19

One of the major concerns that tenants have had during COVID-19 is losing their property. Given the high unemployment rate since the beginning of the pandemic, many home and business owners may have wondered about the legal action that could be taken. Currently, there is a moratorium on evictions that should ease the mind of many. In New York, tenants are protected under an eviction moratorium, applied to residential and commercial real estate alike, that previously lasted until June 20th.

Recently, the moratorium in question was extended until August 20th, providing tenants with additional protection. In order for this protection to be effective, there are certain requirements. The non-payment of rent must be by someone eligible for unemployment (contact the New York State Department of Labor to determine your eligibility) or the individual must have suffered a “financial hardship” due to COVID-19. If this requirement is met, the tenant will be protected until August 20th.

Non-performance can be met with legal action. This can result in, among other events, emotional and mental anguish. For tenants that believe they are within their rights, there are a few events that can be argued in their defense:

Force Majeure – This is a common clause in real estate contracts. Essentially, it removes liability from a tenant in the event of an unforeseen external event beyond the party’s control prevented it from performing its contractual duties. Given that COVID-19 has been classified as a “pandemic,” therefore an event that couldn’t have been foreseen, it could fall under the force majeure umbrella. Courts, however, strictly construe such clauses.

Frustration of Purpose – This legal doctrine excuses one party’s non-performance after entering a contract. Frustration of purpose would apply when an unexpected change in circumstances makes one party’s performance to the other valueless. Thus, the purpose of establishing the contract would be frustrated.

Impossibility –Impossibility is a defense that excuses one party’s non-payment in the event of the contract’s subject matter’s destruction. In a lease, the subject matter would include the premises. For impossibility to be used, it must be the result of an unpredictable event, such as a natural disaster or, arguably, a worldwide pandemic.

While a real estate attorney can provide further insight to tenants, they will also help landlords better understand their rights. After June 20th, landlords can proceed with holdover actions or nonpayment actions if it can be determined that the tenant is not within the requirements for the extension until August 20. A problem, however, is that to start such an nonpayment proceeding, the landlord must file an affidavit, which is a notarized statement used in legal proceedings, from “a person with knowledge of the facts,” attesting that the requirements have been met.

Once this information is compiled, additional steps must be taken. One of the current hurdles is the court system. While courts are open for filing, they are currently unavailable to take on hearings for new eviction proceedings. Essentially, a landlord may not know when they will be able to have their day in court. It is likely that it will be months. A New York or Long Island real estate attorney can provide more insight on when courts will reopen for new hearings.

For additional information regarding eviction moratoriums, consult your local real estate attorney. They will be able to provide more insight into your rights, whether as a tenant or landlord, before helping you take the necessary steps to solve related legal matters. In the current pandemic, legal counsel is as important as ever.

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