2019 Year-End Report

December 19th, 2019 | By: Matthew I. Paletz, Esq.

---

INDUSTRY NEWS

---

Michigan Proposal 1:

As we noted last year, Proposal 1 passed in the fall of 2018 which permits the recreational use of marijuana throughout the state. The sale of marijuana recently took effect on December 1^st, so properties may run across more tenants seeking to use marijuana regularly. Our blog earlier this year outlined the options of a landlord in such a case; feel free to see our link for a summary at https://www.paletzlaw.com/2019/04/29/a-growing-concern-what-michigan-landlords-need-to-know-about-recreational-marihuana/ or contact our Firm if assistance is needed.

Rent Control:

This past year, California joined Oregon in enacting statewide rent control. These measures will likely become more common in the upcoming years, given the affordable housing crisis. This is despite many economic studies having shown that rent control is not a long-term solution, and it could even have the effect of providing tenants with substandard housing. Politicians often view it as a quick-fix remedy that may garner support for their agendas as a whole, as it carries well on social media given that this type of reporting does not fully analyze the drawbacks of rent control. However, there have been efforts by landlords to combat the increase in regulations, specifically in New York City where landlords are arguing that rent control constitutes an unjustifiable taking of property.

Late Fees:

A few years ago, our Firm successfully overturned a Michigan district court’s prohibition on the collection of utilities within a landlord-tenant possessory action. Recently, we had similar success with a district court where the entire judiciary was not permitting late fees. After diligent appeals and dialogue with the judiciary, the majority at that particular district court now do permit late fees to be awarded to a landlord. Regardless of a judge’s often longstanding position on an issue, we will not be deterred from advocating on behalf of landlords and pushing for fairness.

Additional Lease Clauses:

Based on the continual changes in how the law is interpreted, we always recommend periodically reviewing your leasing documents to see if any changes are necessary. As it relates to social media, landlords are using it more frequently as a means to highlight their properties. In light of this, one such clause to consider for inclusion is a term where the tenant would give consent to allow their image to be used in social media. For example, if a landlord is highlighting a summer party that they did for their tenants, they may post some pictures of the event on Instagram.

 

 

---

FAIR HOUSING

---

Legal Aid: 

Legal Aid organizations, who often raise specious fair housing defenses, are receiving increased funding on the national level. Further, the State of Michigan is looking at new ways to offer representation and service to tenants who may qualify for assistance. There are also some movements to allow every tenant in a landlord-tenant case the right to an attorney provided by the court. As such, the nature of landlord-tenant cases will likely shift considerably throughout the next decade in light of increased tenant representation. So, operators should take this into account when evaluating their legal budgetary needs.

Advertising: 

If you’re advertising on social media, which many landlords now do given the high amount of Millennial and Generation Z renters who use social media frequently, you should be mindful that the same guidelines that apply to traditional print advertising will also apply to social media. Furthermore, some social media apps have algorithms that post ads only to certain individuals based on their preferences. For example, earlier this year, Facebook was severely penalized by HUD for its methods in advertising on its platform. Therefore, the specific wording and imagery in your advertising may be more important than ever to avoid potential fair housing liability.

2020 Presidential Election:

As noted above, affordable housing will likely be a key topic as the 2020 race continues. The current executive administration in Washington D.C., and specifically Ben Carson at HUD, has proven to be a stronger advocate for landlords than its predecessor. For example, Dr. Carson has sought to redefine disparate impact and has considered updating guidance regarding assistance animals. However, if there is a change in the HUD Secretary as a result of the election, it could result in more aggressive tenant-friendly guidelines being implemented, similar to those in the middle of the 2010s.

 

 

---

LOOKING AHEAD

---

Trusted Resource:

In a time where properties and personnel are continually shifting at a fast pace, Paletz Law continues to be a constant piece of our clients’ operations. We provide key legal analysis to help our clients make better informed decisions. Additionally, with more frequent employee turnover throughout organizations, we continue to be a trusted resource for our clients to bridge the information gaps between departments.

Territory:

Paletz Law continues to cover more ground. This year, we filed in 100 district courts in Michigan, as well as several in Ohio, ranging from the Toledo area in the north all the way down to the Cincinnati area in the south. For states we are not licensed in, we continue to serve as a project manager and general counsel on our clients’ behalf across their portfolios in coordinating efforts with their legal teams. This works to promote uniformity throughout their operations and practices.

The Next Ten:

This past decade has seen some troubling developments from a legal perspective as it relates to the rights of landlords and their economic freedoms. We anticipate that the next decade may bring more of these developments, and with them, a continued assault on principles that have allowed landlords to operate in ways that best serve their communities. Landlords need and deserve to be heard too, and we will continue to champion the good that landlords do in order to create stronger communities. Thus, having an Innovative Landlord Advocate on your side is now more important than ever.

PaletzTrack Mobile:

For those using our PaletzTrack software platform, many can attest to our mobile version as well. Feel free to use the QR code to the left on your smart phone that will take you to our mobile site, or go to m.paletztrack.com. You can then add it to your phone’s home screen, and then use your PaletzTrack login. If you do not have access to it, but are interested in using it, please let our office know. In the next year, we will continue to explore ways to integrate with our clients to serve their needs. Whether you use Yardi, Rent Manager, ManageAmerica, MRI, RealPage, or any other rental management software, we are here as a technological partner to serve your needs.

At Paletz Law, we pride ourselves on being Innovative Landlord Advocates. We wish you all a great start to the 2020s.