Housing Court expansion: Better or worse for landlords?

Pro-tenant bias would
be spread statewide

Chief Justice Ralph Gants of the Massachusetts Supreme Judicial Court is the state’s top judge, and in a recent op-ed in the Boston Globe, he urges expansion of the Housing Court to the remaining 31% of state residents who can at present only go to a District Court when landlord-tenant conflicts arise. His statements make Housing Court sound like a wonderful place to be for landlords and tenants alike. Not quite so.

Since 69% of the state already has access to a Housing Court, it would seem only logical to extend it statewide. The problem is that landlords widely perceive this specialized court to be very pro-tenant. Those who now go to District Court with their eviction cases oppose the court’s expansion. District Court, they feel, gives them more sensible results. A number of factors are at play that give Housing court its pro-tenant bias.

Delays and more delays are the rule in Housing Court

Evictions for nonpayment are by far the most common kind of landlord-tenant issue that goes to court, and nonpaying tenants very often claim they are “withholding” their rent because of code violations, not because they don’t have the rent. As we all know, the tenant drags his or her feet and won’t let the landlord make repairs. The tenant even damages an apartment to keep code violations present. Why this behavior? As long as there are code violations, the tenant can’t be evicted and lives rent-free. What is happening is an abuse of the state’s rent withholding law. We call it the “free rent trick” because that phrase captures what is going on. We might more politely call it “rent withholding abuse.”

And what is the Housing Court’s role in this abuse? Any delay in court gives the tenant more free rent. Judge Gants praises Housing Court for solving code violation problems and claims of “dangerous conditions” in rental housing. These habitability issues certainly do come up in court, but resolving them speedily is not a virtue of Housing Court. In fact, the Court tolerates and even cooperates in allowing property to be damaged and the presence of code violations to be prolonged. Every delay in court allows this counterproductive tenant behavior. Landlords know this rent withholding abuse happens with the help of Housing Court, and that’s why they feel the Housing Court is biased against them.

Justice delayed is justice denied, as the saying goes

Delays are everywhere in Housing Court. One attorney itemized eight different ways tenants can delay eviction trials. To mention a few: Tenants often request “discovery,” a pretrial motion that requires only that the tenant check a box on a form, as they are advised to do by legal services lawyers. The motion compels the landlord to reveal evidence. Tenants do not really need this information, but it delays the trial for two more weeks – two more weeks of free rent. When the new trial date arrives, the tenant may come in without a lawyer and ask for more time to find one – two more weeks of delay and free rent.

Other delays occur. The tenant may not show up on the trial date, and instead of ruling for the landlord, the judge gives the tenant another delay and a new trial date – more free rent.

The tenant can simply beg for more time with various reasons or excuses (“I’m in the hospital that day”). The tenant’s word is taken as true – and yet more free rent.

The most egregious delay is when tenants ask for a jury trial. Simply checking a box on a form given to them by free legal services lawyers causes a two- to six-month delay. At this point, the Court often does acknowledge the harm of delays to landlords and will – but not always – order the tenant to escrow the rent, which ends the abuse.

No mention by Judge Gants of rent withholding abuse or costly delays

We property owners have been complaining about these delays for over 20 years. We have profiled many cases of tenants “robbing” their owners by abusing the state’s rent withholding law. We have urged passage of a rent escrow law to stop this abuse. Yet Judge Gants’ glowing description of Housing Court has no mention of this issue or of the need for Housing Court reform.

Escrowing the rent (paying the rent into a special account beyond the control of tenant or landlord) during all the delays of an eviction trial would give the tenant the due process rights of a trial, but the money in escrow would be available to pay the landlord the past-due rent that the judge orders in almost all cases at the end of the eviction trial. For decades, the tenant simply moves out, never paying the landlord the past-due rent ordered by the judge.

It’s a matter of fairness. If the tenant has the right to deductions from the rent for substandard conditions in an apartment, which rent withholding guarantees for the tenant, why shouldn’t landlords have a comparable right to ensure they are paid the much larger amount of the past-due rent owed by the tenant, which rent escrowing would guarantee?

A recent study of eviction cases in Massachusetts over 10 months in 2014 found that 14% of Housing Court cases lasted longer than 90 days, while only 5% of District Court cases lasted as long. In other words, landlords taking their eviction case to Housing Court had a one-in-seven chance of their case lasting more than three months, but only one chance in 20 in District Court, a clear suggestion that Housing Court has more delays. The longest Housing Court case was one year, three months, two weeks, and two days, and in the end the landlord “won” (the tenant left) but lost a substantial amount of rent.

Free lawyers for tenants, almost none for landlords

Another source of the Housing Court’s bias is the situation with free lawyers for tenants, which sounds reasonable but backfires against landlords. Tenants below a certain income level (verified simply by asking tenants to state their income) get tax-funded free lawyers, while owners with the same income level are denied free lawyers because they have “assets,” their properties. Tenants surely enjoy the benefits of those assets. To expect lower-income landlords to shell out $250 to $350 an hour for a lawyer is simply unfair. Consequently, many small private owners go into court without a lawyer, up against their tenant who has a free lawyer.

On eviction days (Thursdays), several free tenant lawyers deal with a long line of tenants, handing out easy-to-fill forms that usually create delays. Meanwhile, if lucky, only one lawyer (without forms) is available for landlords.

Tenant advocates and Judge Gants claim that 90% of tenants go into court without a lawyer, while 75% of landlords are represented by lawyers, making landlords appear wealthy. But this statistic is inaccurate. Most landlords with lawyers are lawyers for public housing owners – the city or nonprofit corporations – and most evictions on any court docket of eviction cases come from public housing. So in fact, most private landlords are small landlords who walk into court without a lawyer. And they get beaten in legal maneuvers by the tenant’s free lawyer.

Who are the judges? Whose side are they on?

Housing Court judges, we have heard, often come from legal services backgrounds, which likely gives them a pro-tenant bias. Governor Charlie Baker recently appointed Newton-based lawyer Maria Theophilis to be a Housing Court judge. The new appointee was formerly a lawyer for Greater Boston Legal Services. Only recently has she represented landlords in private practice.

Judge Jeffrey Winik, top judge in the Boston Housing Court, was a staff attorney at Greater Boston Legal Services. Housing Court judge Robert Fields began his career at Neighborhood Legal Services, which serves areas north of Boston. Judge Dina Fein spent 22 years as a lawyer at the same agency.

That’s four judges out of nine in all Housing Courts. Our online search found three judges who did not have any legal services background, and online biographies were not available for the others. Here, then, is another factor in Housing Court’s pro-tenant bias.

Housing Court mediation, wouldn’t it be unbiased?

Mediation, a special feature of Housing Court, is touted by Judge Gants as a speedy and reasonable way for landlord and tenant to come to a mutual agreement in an unbiased way. The problem with the Court’s mediators is that they operate in a pro-tenant environment. During mediation, the landlord is put in the position of accepting a pretty bad deal with a tenant in mediation or risk going to trial and getting a worse deal. Mediators often suggest to landlords that they are better off to agree to a mediated outcome even if it is pro-tenant, such as accepting less rent or no rent for a generously delayed move-out date.

For these various reasons, then, Housing Court has a pro-tenant bias. The root of the problem, however, is not so much the Housing Court itself, but our state’s rent withholding law and its abuse by tenants. If a rent escrow law were passed, the situation is likely to improve noticeably, perhaps even substantially.

What Boston CAN do: tenant displacement and creating lower-rent units

Tenant advocates raise a legitimate concern about tenant displacement. Tenants already challenged by poverty undoubtedly suffer further when required to make an involuntary relocation. But the picture that these advocates draw – “corporate developers” who buy rundown properties, evict the tenants, do major rehabs, and sell the properties as condos at high prices to new residents – does not justify slapping a ban on rehabs and condo conversions in 67% of Boston’s rental housing units.

“Flipping,” as the condo conversion process is called, probably happens in less than 5% of the city’s rental properties. No statistics on this issue have been presented, despite pressure for a major new housing policy. But “something must be done,” as Councillor Frank Baker said at the March 14 hearing on the topic of just-cause eviction.

Direct assistance to tenants facing eviction

So what CAN Boston do? For tenants being evicted, the city needs targeted approaches through the mayor’s new Office of Housing Stability. We would suggest the following kinds of direct assistance to tenants facing eviction.

1) Help in negotiating with a landlord about impending eviction: more time to find suitable new housing rather than under the rush of a 30-day notice, or some help in changing tenant behavior if noise, damage, late rent payment, or similar problems are the real concerns.

2) Relocation assistance The recent, well-received book “Evicted,” by Harvard professor Matthew Desmond, says that when tenants are asked where they would go if they were evicted, they say “to a new home,” but when actually being evicted, they haven’t a clue where to go. The Office of Housing Stability could be an excellent source of information for tenants being evicted, to help them find better, more appropriate places to move to, but also close to public transportation and where good neighbors live, including others from their original neighborhood.

3) Psychological counseling. Since relocation can be very demanding psychologically on tenants, some sort of counseling by social workers could help keep self-esteem up and provide guidance on job-seeking in a new location, maintaining social contacts, and developing new relationships.

4) Tenant rights information. We mention this information because it would undoubtedly be insisted upon by tenant advocates. But it should be made clear to tenants that a history of rent withholding and contesting eviction puts a bad mark on a tenant’s application for new housing. Trying to remain in housing in opposition to the landlord must also put a considerable psychological burden on tenants facing relocation. Any such effort fostered by tenant advocates has these unfortunate drawbacks.

The basic idea here is targeted intervention, not a crude system of eviction controls applied to most rental housing.

Increasing the supply of lower-rent apartments for today’s households

A longer-term solution is to reshape existing housing. America’s households today are much smaller. In 1890 when many existing two-family homes and triple deckers were built, a quarter of all households had 7 or more persons (!) and a third of households had 3 or 4 persons. Today, over a quarter have just 1 person and a third have 2 persons. Quite a big change. With zoning changes, however, this existing housing, or some of it, can be adapted to create smaller, lower-rent, so-called “accessory” or “in-law” housing units. Cambridge has already started to rezone for accessory apartments. The new Office for Housing Stability could champion the needed zoning reform.

Basements and attics all across the city have unused spaces, sometimes already converted illegally into lower-rent, smaller units, sometimes lacking two means of egress and with other safety issues. Existing units can be legalized, and new units in these spaces can be built cheaply, because all the infrastructure – water, sewer, electricity, walls, floors, and roofs – is already in place. Little or no change in historic exteriors is required.

Backyards all across the city can be used for “in-law” cottages. Again, much infrastructure is already in place.

Subdividing triple-decker apartments and other large apartments to create two smaller units again uses existing infrastructure. Owners are willing and able to install these smaller units without government subsidies.

Subdividing bedrooms with pre-fabricated temporary dividers would create low-cost private rooms for students and young professionals. Marriott Hotels are championing single-room “residences” for smart young professionals.

Best practices for owners of existing housing Especially for owners in lower-rent neighborhoods, condo conversion is not the only option. The Office for Housing Stability could develop a list of “best practices” in remodeling for the least cost: sprucing up existing features instead of replacing them, prioritizing capital improvements to preserve housing for the long run, tolerating minor or cosmetic blemishes, and similar approaches to keep costs – and rents – down.