Posts Tagged Evictions

Next AASEW Meeting – The Ins & Outs of Evicting – March 18th

Mar 12

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

The next AASEW meeting will focus on the “The Ins & Outs of Evicting.”

The meeting will be held on Monday, March 18th, 2013 at 7:00 p.m. at the Best Western Hotel located at 1005 S. Moorland Road in Brookfield.

The speakers will be Attorney Tristan Pettit of Petrie & Stocking S.C. and Detective Jon Nilsen of the Milwaukee County Eviction Squad.

Atty. Pettit will discuss the top reasons that the courts dismiss landlord’s evictions and Det. Nilson will speak to us about how the execution of a writ of restitution works and what the Sheriff’s Department does to remove tenants that refuse to leave our rental properties after being ordered by the court to vacate.  Det. Nilsen will also tell us what we can do as landlords to provide the Sheriff’s Department with the necessary and vital information that they need in order to safely complete the eviction process.

Attorney Tristan Pettit focuses his practice on representing landlords and property management companies throughout SE Wisconsin.  Atty. Pettit is the presenter of the AASEW’s popular Landlord Boot Camp and also drafts the landlord-tenant forms that are sold by Wisconsin Legal Blank and used throughout the state.  Tristan is in eviction court in Milwaukee County every week representing many members of the Association and other landlords and property managers.

Detective Nilsen has been with the Milwaukee County Sheriff’s Department for 29 years and a Detective since 1995.  He has served in various capacities within the Sheriff’s Department including being a member of SWAT team for 14 years, the mounted unit, working as a bailiff in the courts, and patrolling the freeways. Since 1995 Detective Nilsen has worked with the eviction squad.

This meeting is free for current AASEW members and $25 for everyone else.

Hope that you all can make it.

 

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Accepting Past Due Rent After Termination of Tenancy: The New Law and Traps To Avoid

Jul 16

Posted by Tristan R. Pettit, Esq. in Act 143 (Landlord's Omnibus Law), Evictions, Legislation, Notices | 3 Comments

The Landlord’s Omnibus Law (Act 143) introduced a new statutory section to Chapter 799 regarding situations when a landlord accepts past due rent from a tenant after the tenant’s tenancy has been terminated.  Newly created sec. 799.40(1m) states as follows:

If a landlord commences an action under this section against a tenant whose tenancy has been terminated for failure to pay rent, the action under this section may NOT be dismissed solely because the landlord accepts past due rent from the tenant after the termination of the tenant’s tenancy.

On its face, this seems like a very helpful statute for landlords.

As a quick refresher, it is important to remember that a tenant’s tenancy can be terminated in many ways such as after the “cure” period passes after being properly served with a 5 day notice, 14 days after being properly served with a 14 day notice, or when a lease term ends.

Prior to sec. 799.40(1m) being created, tenant’s advocates argued — and some courts held — that if a landlord accepted past due rent from a tenant after the expiration of the tenant’s tenancy that the landlord entered into a new agreement with the tenant for a month to month tenancy, thus waiving the landlord’s right to proceed with an eviction action based on the prior notice.

I personally believe that such arguments are hogwash, but I will not digress, as that is not the purpose of this post.

Nonetheless, because this “waiver” argument was successfully raised in the past, I have always advised my clients to err on the side of caution and not accept past due rent after the tenant’s tenancy was terminated.  A landlord can refuse past due rent in one of two ways.  First, a landlord can simply refuse the tendered past due rent from the tenant or return the rent payment to the tenant.  This is always a difficult pill for landlords to swallow as they know that by returning the rent payment to the tenant that they will never see that money again.

Second, a landlord could hold the past due rent payment in escrow (not cashing the check or money order) and immediately write what I refer to as a “no waiver” letter and send to the tenant via certified and regular mail.  A “no waiver” letter simply advises the tenant that their past due rent payment is not being accepted as their tenancy has already been terminated.  The letter also should advise the tenant that it is the landlord’s intent to pursue the eviction of the tenant and that the landlord will hold the past due rent in escrow pending a determination by the eviction court as to who legally has the right to possess the rental property.  Finally, a “no waiver” letter should again remind the tenant that the payment they made is not being accepted.

Whenever I have drafted a “no waiver” letter for a client that has accepted past due rent from a tenant post tenancy, I never had a court hold that my landlord client waived his/her right to proceed with the eviction lawsuit.  As a result, my clients have become big fans of the “no waiver” letter.

With the creation of sec. 799.40(1m), it would seem that there is no longer a need for a landlord to send a “no waiver” letter or to return a past due rent payment to a tenant . . . or is there.  I would caution landlords against thinking that this newly created statute is the panacea that it appears to be.

Let me explain.

First, if you read the new law closely — which I don’t believe the drafters did or they would have remedied this oversight – it states that an eviction based on a tenant’s failure to pay rent, may not be dismissed solely because the landlord accepts past due rent after the termination of the tenant’s tenancy.

There are many basis for terminating a tenant’s tenancy besides just failure to pay rent.  Other reasons may include the expiration of a lease term or a breach of the rental agreement for something other than non-payment of rent (i.e. criminal activity, damage to the property, loud music, illegal guests etc).  The new law does not address what happens if a landlord accepts past due rent from a tenant and the tenant’s tenancy was terminated for somthing other than failure to pay rent.

So literally speaking, a court could still dismiss an eviction if a landlord accepts past due rent from a tenant who’s tenancy was terminated based on something other than failure to pay rent and not run afoul of the new law.  Ouch!  What about situations in which the tenant’s tenancy was terminated for failure to pay rent AND other reasons?  Does the new law applyin those situations?

A second concern with the new law arose recently in Milwaukee County.  Please note that this information was relayed to me by another person so I cannot 100% vouch that I have all the facts correct since I was not present when this happened.  What I was told was that a landlord’s eviction lawsuit, based upon a tenant’s failure to pay rent, was dismissed because the landlord accepted past due rent from the tenant after the termination of the tenant’s tenancy and failed to advise the tenant that it was the landlord’s intent to still proceed with the eviction of the tenant.  The court held that newly created sec. 799.40(1m) was not applicable in this situation because the landlord failed to advise the tenant of the fact that the landlord still intended to evict them.

Simply put, the new law is not as great as it appears — so be cautious when relying on it.  Know your judge.  Know your court commissioner.  Regardless of what the law says, if the court believes it says something else or is not applicable to your specific facts, you may not get the result that you were expecting.

So as a result of above, I am still advising my clients (despite sec. 799.40(1m) being the new law in town) that they should consider refusing to accept any past due rent from a tenant after the tenant’s tenancy has been terminated.  At the very least they should send a “no waiver” letter.

So proceed with caution.

 

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Revised Small Claims Summons Required To Be Used As of November 1, 2011

Oct 24

Posted by Tristan R. Pettit, Esq. in Evictions, Milwaukee County, Small Claims Court | 5 Comments

In a prior post I explained that the small claims jurisdictional limit was increased from $5,000 to $10,000 as of July 1, 2011.  This change has necessitated a revision to the mandatory small claims summons form that is required to be used when filing an eviction, replevin, and collection actions under $10,000 (as well as arbitrations confirmations and personal injury claims less than $5,000).

So far, the Clerk of Courts has been accepting filings using the old mandatory summons (1 page form) as well as the revised mandatory summons (2 page form).  However, as of November 1, 2011, they will only be accepting the new 2 page summons – SC-500.  Remeber that in Milwaukee County you are required to use the Summons that is written in both English and Spanish.  All mandatory small claims forms can be found here.

So if you still have some of the old forms available make sure you use them all up by October 31st.

Don’t have your eviction delayed because you are using an outdated form!

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FREE Landlord-Tenant Law Seminar – September 24th, 2011

Sep 14

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

I wanted to let you know about a FREE landlord-tenant law seminar that I will be presenting for the City of Milwaukee on Saturday, September 24, 2011.

The seminar will start at 9am and run through 11:30 am or so.  It will be held at the Anderson Building which is located at 4001 S. 6th Street – 3rd floor in Milwaukee.

I will be covering three main topics:

  1. Causes for Eviction (including the 5 day, 14 day, 28 day and 30 day notice and under what circumstances you can serve each one)
  2. Notices Terminating Tenancy (how to draft them properly and how to serve them legally)
  3. The Judicial Eviction Process (everything you need to know about how to draft and file an eviction lawsuit and what you will need to present to the court to
    prove your eviction as well as your collection of past-due rent, damages,
    holdover damages etc.)

If you are interested in attending this seminar pre-registration is required so you will need to contact Jeanne Hagner at (414)286-2954 or jhagne@milwaukee.gov

It is necessary that you register so that we can insure that there will be enough outlines and handouts for everyone.

I hope to see many of you there.

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A Legal Explanation To Landlords About Who Can Appear In Eviction Court on Behalf of a LLC and Why

Apr 21

Posted by Tristan R. Pettit, Esq. in Evictions, LLC's | 6 Comments

In the last few months I have been asked by many landlords why Milwaukee County will not allow members of an LLC to represent the LLC in eviction court.  I would like to address this issue with the hope that I can shed some light on this subject.

First, let’s deal with the elephant in the room which happens to be wearing a suit and carrying a briefcase (and writing this blog post that you are reading).  Yes, I am a lawyer.  Yes, I am hired by landlords to handle their evictions (among many other landlord-tenant law matters).  And, yes, I stand to gain more clients and generate more income, if courts do not allow a landlord to represent an LLC in legal matters.  All of this is very much true.

Despite this, I hope that those of you that have gotten to know me, also know that I take my role as the President of the AASEW very seriously.  Even if a specific policy hurts my wallet, if it will benefit members of the AASEW, then I will support it and advocate for it. 

The AASEW’s Board of Directors has discussed this issue at length since September of 2009, when Milwaukee County began its enforcement on non-lawyer’s representing LLC’s in eviction court.  After a thorough analysis, the Board determined that if this issue were to be pursued legally it would result in a loss.  The Board also realized, quite pragmatically, that such a loss would hurt landlords in counties outside of Milwaukee where LLC members are currently still being allowed to represent a LLC in court.

A good place to start discussion of this issue is with a review of basic business entity law.  The primary trait of any business entity, whether a corporation or a limited liability company (LLC), is its existence completely separate from its owners.  An owner, member, director, or officer of a business entity is distinct from the entity itself.  A business entity – and going forward I will refer only to the LLC – has its own separate legal existence.  It is this principle that protects a member of a LLC from liability for the actions, negligence, or debts of the LLC.  While a sole proprietor or general partner is liable for the debts and liabilities of the business to the full extent of the individual’s personal assets, that is not the case with a LLC.  It is this liability protection that makes a LLC a good vehicle for holding rental property.  It is this “separateness” that is pivotal to the analysis of this issue.

The liability protection that a member of an LLC receives from his/her personal assets is a huge benefit to the member.  It is because of this benefit, that there has been such a huge increase in the number of LLC’s being created lately.  However, as with everything in life, there is both a good and a bad side — a benefit and an inconvenience. 

In the case of Jadair v. U.S. Fire Insurance Co., 209 Wis. 2d 187, 562 N.W.2d 401 (1977), the Wisconsin Supreme Court held that “only lawyers can appear on behalf of, or perform legal services for corporations in legal proceedings before Wisconsin Courts.”  The Jadair Court’s reasoning, when boiled down to the basics, is that an individual cannot embrace the limited liability aspects of a business entity when it is beneficial to them and then at the same time avoid the consequences of that limited liability when it becomes inconvenient. 

On one hand, the benefit of a LLC is the limited liability to the individual member based on the underlying concept that the business entity is separate from the individual person.  On the other hand, the inconvenience of a LLC is that since it is a separate legal entity from its individual member/s, said individual/s cannot speak on behalf of the LLC in court because they are separate and distinct from the entity itself.

The Jadair case dealt specifically with corporations – not LLC’s.  Nonetheless, the similarities between a corporation and a LLC when it comes to the issue of limited liability are many.  It is important to note that the Jadair case also dealt with a large claims lawsuit – not a small claims matter such as an eviction.

There is a big difference between small claims civil procedure and large claims civil procedure. 

One major difference is that small claims court is much more relaxed when it comes to rules.  For instance, in small claims cases the rules of evidence are not applicable for the most part.  Additionally, small claims cases are usually completed in months instead of years like with large claims.  They are separate animals.

As such, sec. 799.06(2) of the Wisconsin Statutes, governing small claims court procedure, allows a full-time authorized employee of a business entity to appear in court on behalf of that entity.  This option is not available in large claims court.  In all large claims cases a business entity must be represented by an attorney.

In the past, Milwaukee County would ask a non-attorney that appeared in small claims court representing a LLC if they were a full-time employee.  If the individual answered “yes,” then that individual was allowed to represent the LLC in Milwaukee County small claims court.  This is still the normal operating procedure for many small claims courts outside of Milwaukee County.  Some counties require the full-time employee to complete an Affidavit of Full-Time Employee where the employee swears under oath (and penalty of perjury) that they are a full-time employee of the business entity.  Other counties are more lax and don’t require the affidavit.

The Jadair case has been around since 1977 and sec. 799.06(2) has been around even longer.  So there has been no change in the law.  Rather Milwaukee County began more aggressively enforcing the law that was already on the books regarding this issue in September of 2009

I am unsure why Milwaukee County decided to begin enforcing sec 799.06(2) in the fall of 2009.  For those conspiracy theorists out there, I can assure you that the lawyers did not lobby for this change.  Nonetheless, after posting notice of this enforcement change for several months, on September 1, 2009, Milwaukee County began to actively enforce sec. 799.06(2).  If an individual wanting to represent a LLC in small claims court cannot provide proof of full-time employee status, such as a W2 or paycheck, they are told that they needed to hire a lawyer going forward.

As many of you know, most LLC’s that hold rental property do not have any full-time employees.  Most LLC’s holding rental property are single member LLC’s.  Most members of an LLC do not receive a salary from the LLC thus they have no paycheck or W2 that they can provide to the court to prove that they are a full-time employee. 

Additionally, many landlords – to limit liability exposure even more – have opted to hold only one rental property in a single LLC.  Thus, an individual who has many rental properties and chooses to put them into separate LLC’s may be the sole member of many, many LLC’s.  So even if that person was a full-time employee of one LLC, s/he could not be a full-time employee of all of them.

Currently there is no Wisconsin appellate court decision that requires a lawyer to represent a LLC in court.  However, as alluded to earlier, the reasoning in Jadair, which held that a corporation must be represented by an attorney, would very likely be applicable to a LLC as well.  So any landlord that would decide to appeal a Milwaukee County decision on this issue would more than likely lose his/her appeal based on sec. 799.06(2) and the reasoning of the Jadair case.

Additionally, as I mentioned before, many counties are currently not enforcing sec. 799.06(2) with as much vigor as Milwaukee County has been doing.  As a result, many landlords outside of Milwaukee County are able to represent a LLC in court despite not being a lawyer.  While this is not legally correct, it is happening.  

It should be noted that Washington County has recently begun to enforce this statute as well and now requirs a LLC to hire an attorney if they do not have a full-time authorized employee of the LLC to appear on its behalf.  Eventually I assume that this trend will spread to other counties, as what happens in Milwaukee often ends up being followed elsewhere.

So to pursue this matter legally – since it would more than likely result in a loss — would also harm landlords outside of Milwaukee County because if the issue were to be appealed, and if the appellate decision were to be published, then all counties would be required to abide by the holding of the appellate court.

While I am well aware that the enforcement of sec. 799.06(2), Wis. Stats., causes a financial hardship for landlords that hold rental property in a LLC, I hope that the above explanation – at the very least – helps those affected to better understand the issues involved.

The end result is that if an individual landlord wants to be able to pursue his/her own evictions without hiring a lawyer, than s/he should hold his/her rental property in his/her individual name rather than in a LLC.  However, by doing so, a landlord will lose the liability protection afforded by holding rental property in a LLC or other business entity.  As the old saying goes, landlords will need to “pick their poison.”

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A De Novo Hearing Is A “Second Kick at the Cat”

Mar 9

Posted by Admin in De Novo Hearings, Tenant Damage | 2 Comments

Under Wisconsin law, a Court Commissioner cannot decide a contested eviction action — that must be decided by a judge.  However a court commissioner can preside over and decide a hearing on a landlord’s 2nd and 3rd causes for action for money damages.  Typically this includes claims for past due rent, physical damages to the rental property or holdover damages.

In Milwaukee County, due to the large number of cases,  if a tenant diputes the landlord’s claims for damages, the matter must first be heard by a Court Commissioner.  The Court Commissioner will issue a determination based on the evidence presented.  If either the landlord or the tenant does not agree with the decision of the Court Commissioner, either party has the aoutomatic right to request a de novo hearing before the circuit court judge. 

De novo literally translates to “anew;” “afresh;” or ”a second time.”

A de novo hearing is essentially a “do over”  — the parties have the opportunity to present their evidence over again to the judge.  They are not restricted to the evidence that they presented in the prior hearing before the court commissioner.  New evidence can be presented or old evidence can be removed.

De novo hearings are often referred to incorrectly as “appeals.”  A de novo hearing is an opportunity to redo your case.  An appeal is a review of a lower court’s decision for error.

A de novo hearing is a “second kick at the cat,” if you will.

NOTE:  I currently own a cat.  I have had cats as pets in the past.  I love cats.  By using the above phrase “a second kick at the cat” I am not suggesting or condoning the hurting of a cat.  No cat’s were harmed in the writing of this blog post.

Above is a video clip from a seminar that I presented last year about de novo hearings.

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New Rule In Milwaukee County Eviction Court Will Limit The Number of New Evictions to 80 Per Day

Mar 2

Posted by Tristan R. Pettit, Esq. in Evictions, Milwaukee County | 2 Comments

In an effort to eliminate the congestion in eviction court, Milwaukee County has imposed a limit of 80 new eviction cases per day.  In the past there have been days in which over 300 new eviction cases were scheduled to be heard in the same afternoon, which often became unmanageble.

This new limit only applies to new case filings for eviction cases (the 1st cause of action) for return of the property.  This new limit does not include evidentiary hearings, adjourned matters, or return dates for 2nd and 3rd causes of actions (for money damages).

I was informed that the Clerk of Courts will be keeping a running tally of eviction cases scheduled for each return date/initial appearance.  Once that tally reaches 80, no more cases will be allowed to be filed for that same return date.

While I understand the reasoning for this new policy, I do have some concerns.  I agree that eviction court can become unmanageable due to the high volume of cases.  Us “regulars”  to eviction court have had to spend much of our lives sitting and waiting in good ol’ room 400 of the Milwaukee County Courthouse due to the high volume.  Despite that I have always had my cases completed before 5 pm.

I work for several clients that have a high volume of evictions each month.  One client in particular easily has 40 evictions per month and has topped out at 66 evictions on more than one occassion.  In order to keep costs down for such clients I schedule all of that client’s evictions to be heard on the same day.  This limits the amount of fees that they client has to pay me and allows them to only spend one day per month in court. 

This new policy may prevent that client, and other landlords similarily situated, from having all of their cases heard on the same day — thus increasing their costs and encroaching on their valuable time.  Let’s face it evicting a tenant is a a money-loser to a landlord.  It is a necessary evil that they would like to keep to a minimum if at all possible.

Another foreseeable issue would be the landlord that has a smaller number of evictions each month – say 10 — who wants to have them all heard on one day in eviction court.  What will happen when s/he goes to file the evictions and is told that there are only 3 spots left for evictions on the day s/he wanted to appear in court?  That landlord weill either have to scheduled his/her 7 remaining evictions on a different day or choose to postpone all 10 evictions to another day in order to have them all heard at once.  The former option wil require the landlord to spend 2 days in eviction court.  the latter option will result in a non-paying tenant having additional time to live rent free.  Either option causes the landlord money.

So while I understand the motivation for this new rule I am not sure that it will benefit Milwaukee County landlords.  We will have to wait and see.

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