HUD Issues New Rule On “Discriminatory Effect” a.k.a Disparate Impact

Feb 20

Posted by Tristan R. Pettit, Esq. in AASEW, Fair Housing / Discrimination, Legislation, Protected Classes, Screening Tenants | No Comments

HUD has issued a new Fair Housing “disparate impact” rule that may cause problems for landlords during the screening process.  The new rule creates a new provision entitled “Prohibiting Discriminatory Effects” which defines “discriminatory effect” as situations in which a facially neutral (i.e. not discriminatory) housing practice can become discriminatory if it actually or predictably has an effect on a group of persons that are members of a protected class.

The concern is whether or not this new rule will restrict landlord’s use of criminal background checks on prospective tenants.  Recently Pepsi Co. agreed to pay $3.13 Million to resolve allegations of hiring discrimination against African-Americans based on Pepsi’s use of the African-American’s arrest records.

This recent settlement when read in conjunction with HUD’s new rule causes concern regarding whether it will be considered discriminatory to use a person’s criminal arrest or conviction as a basis for rejecting a rental applicant when such use would result in members of a protected class being rejected as tenants.  For more on this issue and
please read Tim Ballering’s blog post entitled ‘Will Criminal Background Checks For Screening Be Restricted By Proposed Federal Rule?”

In light of this concern, the AASEW’s Executive Committee submitted the following comments to HUD:

The Apartment Association of Southeastern WI, Inc. is a trade association representing approximately 575 owners and managers of rental housing in the Metro Milwaukee area.

Our organization supports Fair Housing as well as community efforts to reduce the effects of crime within the neighborhoods that our members own and manage rental housing.

We are concerned that this proposed rule will restrict the  legitimate and necessary use of criminal arrest and conviction records in screening tenants to exclude those who will cause disruption and harm to other occupants, the neighborhoods those properties are located in, and to our properties.

Many communities in southeastern Wisconsin have “Nuisance Property Ordinances” that hold owners accountable for the misdeeds of their tenants.  For example Milwaukee’s Nuisance Ordinance does not require the conviction, nor the arrest of the tenant or their invitees, rather simply repeat law enforcement activity will trigger the enforcement provisions of that ordinance.

As part of your proposed rule property owners need “bright line” guidance, establishing what background screening criteria and methods will remain acceptable under this proposed rule as well as protections from potentially conflicting local requirements.

It would be inequitable, causing unnecessary costs and harm to property owners if such guidance is not provided in advance of the implementation and enforcement of this proposed rule.

Hopefully additional guidance will be provided.  If and when it is I will be sure to provide everyone an update.

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CCAP Committee’s Recomendation To Change Wisconsin’s Expungment Laws Shot Down

Feb 14

Posted by Tristan R. Pettit, Esq. in CCAP, Legislation, Screening Tenants | 2 Comments

Last year Wisconsin’s Joint Legislative Council created a Special Committee On The Review of Records Access of Circuit Court Documents – what I affectionately referred
to as the CCAP Committee.  Landlords were very fortunate that in the end the committee made no recommendations to change or alter information on CCAP or limit its access by landlords or any other group.  The committee’s sole recommendation was to call for the liberalization of Wisconsin’s criminal expungement statute.

The proposed bill, if passed would have done the following:

1.  Defined what is meant for a court to expunge a court record (and yes, this did include removing any reference to the conviction from CCAP)

2.  Clarified that an expunged record may not be considered for employment or housing matters.

3.  Stated that a person may petition the circuit court at any time to expunge the following:

-  any court record of a person who was under the age of 25 at the time the crime was committed and who was found guilty of a forfeiture, misdemeanor, and certain (lessor) felonies, that are punishable by up to 6 years in prison.

- any court record of a person charged with an offense punishable by a forfeiture, misdemeanor, or felony in which all charges were dismissed or for which the defendant was acquitted AND the court determines that the person will benefit by the expungement and that society will not be harmed by the expungement.

So as you can see, the proposed bill would have negatively affected landlords in the screening process and if passed would mean that a landlord would find no record of the applicant having ever been charged and convicted of crime x, y or z (or charged and acquitted or charged and the later dismissal of the case), if the applicant had applied for and received an expungement.

It also would have meant that even if the landlord somehow learned of the conviction (or acquittal or dismissal) and the later expungement, that the landlord could not use that information when making a decision on whether or not to rent to that individual.

Furthermore, it would have meant that a landlord would be precluded from inquiring as to the existence of any expunged record from a rental applicant whether that question
be on the rental application itself or verbally when talking to the applicant.

Thankfully we do not have to worry about this proposed bill being passed as it never even got introduced.  In a notice dated January 20, 2012, the Director of the committee wrote to the members of the committee to inform them that their recommended bill was not approved for introduction by the Joint Legislative Council by a vote of 13 to 6.  While a petition can be circulated to have the matter reconsidered, I have not heard of that happening.

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Last Chance To Sign Up For AASEW’s Landlord Boot Camp 2012

Feb 7

Posted by Tristan R. Pettit, Esq. in AASEW, Seminars | No Comments

Hi Everyone:

We have had a very good response to our ads for the AASEW’s 4th Annual Landlord Boot Camp.  So much so that seats are quickly running out . . . or we may need to consider adding a second seminar shortly after the first.

If you are interested in attending this year’s Boot Camp on Saturday, Feb, 25th, I would strongly suggest that you register here.

I will be presenting this all-day seminar (8:30 am – 5:30 pm) at the Clarion Hotel located at 5311 S. Howell Avenue.

I will be teaching you everything you need to know legally to be a residential landlord or property manager.

Here are what past attendees said about Landlord Boot Camp.

We will cover topics such as:

-       How to screen applicants

-       How to avoid discrimination issues and better understand fair housing laws

-       How to draft legal screening criteria

-       How to legally reject an applicant

-       How to spot an applicant that is “fronting” for another applicant that won’t qualify to rent from you

-       What rental documents you should be using and why

-       The Residential Rental Practices (Wisconsin Administrative Code ATCP 134) and what can happen to you if you violate any of these 21 regulations.

-       What are the “7 Deadly Sins” and why you cannot include them in your rental agreement

-       What is the best way to evict a tenant and how to accomplish this

-       What are the different choices a landlord has when deciding what type of notice to serve a tenant

-       How to serve a tenant a notice so that service cannot be attacked in court

-       How to navigate your way through the judicial eviction process

-       What evidence you must present at an eviction trial to prevail

-       What to do with a tenant’s abandoned property

-       How to draft a legal security deposit transmittal letter

-       How to collect for past due rent and damage from an ex-tenant (or should you even bother pursuing this)

. . .  and much more.

All attendees will also receive a 100 page + manual (with lots of sample forms) to refer to in your business when the seminar has faded from your memory : )

Attendees will also receive a free lunch on the day of the seminar.

Cost is $159 for members of the AASEW, $249 for non-AASEW members (you can join the AASEW for an additional $1), $199 for members of any landlord or apartment association.  Past attendees will receive a discount for attending again.

Register online or by calling the AASEW at 414-276-7378.

I hope to see all of you there!!!!

 

T

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Landlords & Wisconsin’s New CCW Law

Jan 30

Posted by Tristan R. Pettit, Esq. in CCW, Landlord Liability | 1 Comment

As I’m sure many of you are aware, Wisconsin has a new Carrying Concealed Weapon (CCW) law.  Wisconsin Act 35 was signed into law on July 8, 2011 and took effect on November 1, 2011.

Since the new law was published, I have received several calls from landlords and property management companies asking me how this new law will affect them.  Since the question has come up repeatedly I thought I would do a post on it.

If you have any questions about the CCW law generally the best resource I can direct you is a document that was published by the Wisconsin Department of Justice in August 1, 2011 entitled “Wisconsin’s New Carrying Concealed Weapon Law: Questions and Answers“   If you are interested in learning how the new law applies to employers generally (not just landlords) you should read Petrie & Stocking’s Talking Workplace Law Blog posts on the subject here and here.

The Basics:

1.   The law allows individuals to carry a concealed weapon upon their person in most locations as long as they have applied for and received a permit to do so.

2.  The types of weapon that can be carried include: handguns, an electric weapon as defined in Wis. Stat. § 941.295(1c)(a), a billy club, and a knife other than a switchblade.  See Wis. Stats. § 175.60(1)(j). A handgun does NOT include a machine gun, short barreled rifle or short barreled shotgun.  See Wis. Stat. § 175.60(1)(bm)

2.   The law provides immunity to owners of property who do not prohibit the carrying of concealed weapons on their property.  So if you allow concealed carry on your property by others you will not be held liable for any consequences arising from that decision.  Wis. Stat. § 175.60(21)(b).

3.   The law also permits owners to prohibit persons from carrying concealed weapons on their property.

4.   Prohibiting concealed carry on your property strips you of the immunity mentioned above.

5.   If you wish to prohibit concealed carry on your property you must post signs that are (a) at least 5 inches by 7 inches, (b) state that concealed weapons are not allowed in the building or on the premises, (c) specify the area where the prohibition applies if the prohibition only applies to a portion of the property, (d) place the signs on or near all entrances to the building.

So How Does The New Law Affect Landlords?:

An owner of rental property must decide whether or not they wish to prohibit the carrying of concealed weapons in their rental property and on the property grounds.  Second, if they do wish to prohibit concealed carry they must determine if the prohibition will apply to the entire building or just certain portions of the building.  Third, they must post the required signage.

If you prohibit concealed carry in your rental property, and proper notice has been posted, then it is against the law for anyone to enter, or remain in the common areas of the building or on the grounds of the building after being asked to leave, while carrying a concealed weapon.

IT IS IMPORTANT TO NOTE that Wisconsin’s new CCW law does not address a tenant’s right to keep a weapon in his/her rental unit.  The CCW law only deals with carrying a concealed weapon in public places such as the common areas of the apartment building.  So even if the landlord posts signs preventing concealed carry in the apartment building, that does not prevent a tenant from keeping a weapon in his/her unit.  A tenant has the right to keep a weapon in his/her rental unit just the same as a homeowner has the right to keep a weapon in his/her single family home.  So if a landlord does not want a tenant to be able to keep a weapon in their rental unit than such language must be included in the tenant’s rental agreement.

Also, even if a landlord prohibits concealed carry in the rental property, that prohibition does not apply to the apartment’s parking lots.  A tenant is  allowed to keep a weapon in his/her vehicle if parked in the apartment complex’s parking lot.

Many Unanswered Questions:

Wisconsin’s new CCW law leaves many questions unanswered.

One question that immediately came to my mind is what will happen in those situations in which a landlord prohibits concealed carry in the apartment complex but has failed to include a lease provision prohibiting a tenant from keeping a weapon in the tenant’s rental unit?  The tenant has a right to keep a gun in his rental unit but how can he get the gun to and from his unit without violating the CCW prohibition since, depending on the layout of the apartment complex, the tenant will have to walk through a common area such as a hallway or lobby?  Which “right” trumps in this situation?

Taking a more broad perspective of the law, there are even more important questions that remain unanswered, such as:

-   How broad will the immunity provided under the new law extend?

-  If a landlord decides to prohibit concealed carry in his rental property is he opening himself up to increased liability exposure?

-  If a landlord prohibits concealed carry in his rental properties, does s/he now have a broader duty to protect his tenants or their visitors from someone that may enter the rental property with a weapon and ignores the CCW prohibitied posting?  Does the landlord have an obligation to actively attempt to enforce his no CCW policy?  If so, how should he enforce it?  Does he have to post an employee at every entrance to ask people who enter if they are “packing heat”?  Does he have to frisk people upon entering the apartment building?  If a tenant is injured by another person who ignores the CCW prohibited sign will the landlord be liable to the tenant?

We will not learn the answers to these questions until the DOJ provides additional guidance or until lawsuits are filed, trial court and juries make decisions, and appellate courts either affirm the trial court’s decision or not.

For additional factual scenarios and unanswered questions raised by Wisconsin’s new CCW law I reccomend a magazine article entitled “Concealed Weapons Questions and Answers” written by Attorney Josh Johanningmeier published in the Wisconsin Independant Agent magazine.

 

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Q&A: What A Landlord Should Do If Tenant Gives An Improper 28 Day Notice

Jan 17

Posted by Tristan R. Pettit, Esq. in Notices | 7 Comments

Every now and then I like to highlight a question or comment that I receive on this blog that I think is especially educational.  I recently received a great question from Peter which I have decided to reproduce as a blog post so that more people can view it and become better educated on the topic.

This specific question has to do with a month to month tenancy in which the tenant has served the landlord with an improper 28 day notice as the termination date does not coincide with the end of a rental period (i.e. end of the month) as required under Wisconsin Statute sec. 704.19.

Attorney Pettit,

This may be a little off subject, but I was hoping you could explain what a landlord’s responsibility is when a tenant serves their landlord with a notice terminating their tenancy, but specifies an inaccurate termination date in the notice.

For example: a periodic tenant serves a 28 day notice to their landlord on 04-01-2012 terminating their tenancy on 05-05-2012. The notice was served with the proper length of time under Stat. 704.19(3), but it did not terminate the tenancy at the end of a rental period as required by Stat. 704.19(2)(b)1.

I know Stat. 704.19(5) says that such a notice would be valid, but would not be effective until the first date which could have been properly specified – i.e. May 31, 2012. My concern is the second-to-last sentence in Stat. 704.19(5) that says the party to whom the notice was served may “elect to treat the date specified in the notice as the legally effective date.”

Does that sentence mean the landlord has an obligation to inform the tenant that the termination date in their notice was inaccurate and will not be effective until May 31? If the landlord does not inform the tenant that the termination date in their notice was ineffective, could that be construed as the landlord’s “election” to treat the inaccurate date as the legally effective date?

There is no explanation in the chapter which describes what constitutes an “election” in this circumstance and that sentence seemingly creates an enormous loophole through which tenants can escape their responsibility to give a proper notice to vacate. Any thoughts or information you have on this matter are greatly appreciated. Thank you.

—–

Peter – Thanks for your question.  Plese feel free to call me Tristan : )

You have cited the proper Wisconsin Statute that is applicable for this issue – 704.19.  Sec. 704.19 is really the only guidance that we have on the issue.  I am not aware of any caselaw interpreting 704.19 in Wisconsin.

I interpret the statute to mean that you, the landlord, can choose to accept the defective notice as it is and relieve the tenant for responsibility for rent after 5-5-12.  If you do not want to accept the defective notice and relieve the tenant of responsibility as of 5-5 then I think it would be necessary to point out the tenant’s error to the tenant, preferably in writing, to avoid an “waiver” argument that might be made by the tenant.

Each court (each judge, each court commissioner) is able to interpret the statute and the term “election” as they wish and to determine if you, the landlord, waived your right to the entire month’s rent by failing to bring the tenant’s error in the notice to his/her attention.

I don’t know whether or not a court would decide that if you failed to bring the defective notice to the tenant’s attention that you waived your right to collect the full month’s rent.  But sxperiencing how tenant-friendly many Wisconsin courts are, I wouldn’t want to take the chance.  To be safe – and to “CYA” — I would assume that a tenant might make the “waiver” argument and that a court could might make a ruling that because you did not bring this discrepency to the tenant’s attention, that you waived your right to the full rent amount for May 2012.

From a practical standpoint, if I received an improper 28 day notice from a tenant, I would call the tenant  and politely explain to them why the notice was improper and what the legal ramifications are — that they are “on the hook” for all of May’s rent.  I would then follow that telephone call with a letter memorializing the discussion and explaining why the tenant’s 28 day notice was improper– explaining that the 28 day notice must coincide with the end of a rent paying period per 704.19(2)(b)(1).

Next, I would include in my letter that had the notice been drafted properly, that the tenant would be responsible for rent through the last day of the month – May 31st.  I would then tell the tenant that you will treat the notice as effective on the last day of the month and remind them that while they can leave before the last day of the May that they are responsible for the full month’s rent.

I would then wait and see what the tenant does.

Hopefully, after your explanation and showing them the statute, the tenant  will understand that they made a mistake and pay you the entire month’s rent.

If the tenant doesn’t pay you any rent or only pays rent for 5 days of May, you should “5 day” them and then decide if you want to retain a portion of their security deposit to cover the rent that they are legally responsible for paying or if you would prefer to return the security deposit (to avoid any potential chance of the tenant being awarded double damages and attorney’s fees) and sue them in a small claims (non-eviction) action for the rent they owe.  There are pros and cons to either option and I am not suggesting one over the other but as I see it those are the two options that you have.

Thank you for your great question.

 

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Don’t Miss AASEW’s January “Town Hall” Membership Meeting on January 16, 2012 at 7 PM

Jan 13

Posted by Tristan R. Pettit, Esq. in AASEW | 1 Comment

January’s Apartment Association Meeting will be held this coming Monday, January 16, 2012 at 7 pm at the Best Western Hotel located at 1005 S. Moorland Road in Brookfield.

We will be hosting a “Town Hall” style meeting at which you can pose any and all of your property management or landlord-tenant law questions. Both Stacy Hegg of Wellston Properties and Atty. Tristan Pettit will be panel members.
Please bring yourself, a friend, and your questions to our meeting.

We have many new and exciting things in store for the AASEW in 2012.  If you haven’t been to a meeting in awhile please come and join us!!!!

See the Association page for the more details

http://apartmentassoc.org

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You Will Not Want To Miss AASEW’s Fourth Annual Landlord Boot Camp on Saturday Feb. 25th

Jan 3

Posted by Tristan R. Pettit, Esq. in AASEW, City of Milwaukee, Collections, Credit Checks, De Novo Hearings, Earnest Money, Emergency Assistance, Evictions, Execution of Writ, Fair Housing / Discrimination, Holdover Damages, Landlord Liability, Late Fees, Lead-Based Paint, Milwaukee County, Mitigation of Damages / Re-Renting, Notices, Pets, Property Management, Protected Classes, Reasonable Accomodations, Reasonable Modifications, Rejecting Rental Applicants, Rental Agreements, Rental Documents, Right of Entry, Roommates, Screening Tenants, Security Deposit, Self-Help Evictions, Seminars, Small Claims Court, Smoke Detectors, State of Wisconsin, Tenant Damage, Untenantability, Walkthroughs | 2 Comments

Landlording can be pretty complex, with a seemingly never ending myriad of paperwork, rules, landlord-tenant laws and simple mistakes that can cost you thousands of dollars.

The Apartment Association of Southeastern Wisconsin’s Fourth Annual “Landlord Boot Camp” can help you navigate these treacherous waters and teach you how to run your properties with greater profit and less hassles.

I have given similar landlord-tenant law seminars to fellow attorneys, landlords, and property manager organizations throughout the state for other state-wide semianr companies that charge attendees $300-$400.  This is your opportunity to learn all of the same information at a huge discount through the Apartment Association.

 

Who:   Taught by Attorney Tristan R. Pettit (who drafts the landlord tenant forms for Wisconsin Legal Blank)

When:    Saturday, February 25th, 2012. 8:30 am – 5 pm

Where:   Clarion Hotel 5311 S. Howell Avenue, Milwaukee [Map]

Included:  100 plus page manual/outline to help you put what you learn into practice plus helpful forms.

Cost:  $159 for AASEW members and $249 for non-members.  If you are not a member of AASEW but are a member of another landlord/apartment association the cost to attend will be $199.

Specials: Not a member?  Pay just a dollar more and enjoy a 2012 AASEW membership.

Wisconsin landlord-tenant laws are constantly changing.  To help keep you up to date we offer prior attendees a $50 discount.

Sign up by going to the AASEW’s Landlord Boot Camp landing page where you can sign up online and pay via PayPal.

 

What you will learn at the Apartment Association’s 2012 Landlord Boot Camp

Landlord Boot Camp covers everything that you need to know about residential Landlord Tenant law in Wisconsin, including:

  1. How to properly screen prospective tenants.
  2. How to draft written screening criteria to assist you in the selection process and protect you from discrimination complaints.
  3. How to comply with both federal and state Fair Housing laws including how to handle with “reasonable modifications”  and “reasonable accommodations” requests.
  4. How to legally reject an applicant.
  5. What rental documents you should be using and why.
  6. When you should be using a 5-day notice versus a 14-day notice, 28-day notice, or 30-day notice and how to properly serve the notice on your tenant.
  7. Everything you wanted to know (and probably even more than you wanted to know) about the Residential Rental Practices (ATCP 134) and how to avoid having to pay double damages to your tenant for breaching ATCP 134.
  8. When you are legally allowed to enter your tenant’s apartment.
  9. How to properly draft an eviction summons and complaint.
  10. What to do to keep the commissioner from dismissing your eviction suit.
  11. What you can legally deduct from a security deposit.
  12. How to properly draft a security deposit transmittal / 21 day letter.
  13. How to handle pet damage.
  14. What to do with a tenant’s abandoned property and how this may affect whether or not you file an eviction suit.
  15. How to pursue your ex-tenant for damages to your rental property and past due rent (and whether it is even worth it to do so).

. . .  and much more.  There will also be time for questions and answers.

You get all this for less than you would pay for an hour of an attorney’s time.

Last year’s AASEW Landlord Boot Camp was filled to capacity and we even had to turn a few people away.  So call early to reserve your spot.

Call the Association at (414) 276-7378, email membership@apartmentassoc.org or go to our Landlord Boot Camp landing page to sign up online and reserve your spot.

Remember that “landlording” is a business — so take the time to educate yourself on how to better manage your business and avoid costly errors!

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