Robin Vos’ Slumlord Bill May Pass today!

So, this is it, the bills destroying tenants rights, and tipping the scales in favor of unscrupulous landlords is headed for passage. It really sucks, because there are so many good landlords out there that probably wouldn’t do these types of things, but then there are others (supporters include the Realtors, Apartment Association for South Central Wisconsin, Robin Vos), who will take full advantage of the new laws. Here’s some descriptions of why the bill is so terrible. Right now, the Senate goes back into session today at 10:00 and the third reading of the bill is on their agenda, then it gets messaged to the assembly and they should wait 12 hour before they pass it, but who knows. Two nerve-wracking days left. (Summary of what the bill does is here.)

7 Reasons to Vote Against Senate Bill 466

1. The bill removes the deterrent against illegally keeping security deposits. Specifically, it eliminates automatic double damages, court costs and attorney’s fees for stolen security deposits. Some landlords make a practice of illegally withholding security deposits, especially in student areas. Now, they will be able to do so with impunity. Tenants will not pay $96 to get back $100 or $200 of a security deposit; unscrupulous landlords will have no incentive to return it.

2. It would allow commercial landlords to sell the inventory of small business owners and pocket the profits. Under the bill, landlords can sell or dispose of any property items belonging to residential or commercial tenants left on the premises after the tenancy is terminated or ended, whether or not the property is owned by a third-party or functions as security for a loan. Will businesses want to locate in Wisconsin with this kind of law on the books?

3. The bill is poorly drafted and has not been carefully reviewed; the version of the bill that came out of committee would have voided essentially all commercial real estate leases in Wisconsin. It was not until opponents of the bill pointed out this mistake that an amendment was put forth. Who knows what other unintended consequences will result from this legislation? One thing is sure: the numerous legal ambiguities and potential loopholes will keep lawyers and the courts busy for many years to come.

4. The bill encourages landlords to attempt to include illegal lease provisions. SB 466 forces courts to honor leases that might contain provisions that are repugnant to public policy. Under current law, courts have the ability to void leases that contain illegal provision. SB 466 restricts this authority to certain types of provisions.

5. The bill eliminates local control. SB 466 prohibits local “eviction moratoriums.” This will prevent municipalities from addressing local foreclosure issues and improper illegal eviction actions. In the hearing there was little said to support this provision. The one specific example mentioned was a past practice in Milwaukee to halt evictions on Christmas.

6. It allows landlords to rent units that have structural damages or lack heat or hot or running water without notifying the prospective tenant of these deficiencies. SB 466 eliminates clear, bright-line notice requirements and instead requires notice when a building code violation poses a “significant threat to the prospective tenant’s health or safety.”

7. The bill greatly reduces or eliminates DATCP’s authority to deal with landlord-tenant issues. SB 466 prohibits DATCP from issuing an order or rule that “changes” any right or duty under chapter 704. This type of limitation on agency authority is incredibly unusual, if not totally unprecedented. The legislature will be preventing DATCP from protecting the rights of both landlords and tenants with respect to future issues or conflicts.

Don’t like that one, try this one:

1. Tenants Will Not be Able to get Their Security Deposits Back, Because the Substitute Amendment Says Only that a Violation MAY be an Unfair Trade Practice – Under Current Law the Refusal to Return a Security Deposit IS an Unfair Trade Practice and the Tenant SHALL Recover Double Damages Plus Reasonable Attorney Fees.

Under the substitute amendment the tenant’s right to enforcement is eliminated. Not only does the substitute say may instead of shall, it says only that it may be an unfair trade practice. There is no automatic connection to the specific statute that guarantees a tenant double damages and reasonable attorney fees – s. 100.20 (5). A court could find that this is an unfair trade practice, and still not be able to provide relief for the tenant, because s. 100.20 (5) provides double damages and reasonable attorney fees FOR A RULE VIOLATION. The violation of this statutory provision is not a rule violation – it is a violation of a statute. There is nothing that automatically triggers s. 100.20 (5). We know from past experience that where tenants do not have any guaranteed enforcement for wrongful withholding, landlords will not return deposits.

This was the number one complaint against landlords when the DATCP code was written and remains among the top two or three complaints to this day. It was largely the reason for the code to be created. By putting this provision in the statutes, this bill will preclude DATCP from maintaining this provision in the code. As a result, the law that tenants shall receive double damages plus costs and reasonable attorney fees for violations will be eliminated. The only penalty or remedy that will remain is the obscure or oblique reference in the substitute amendment that a violation of this may be an unfair trade practice. This is only an indirect reference to double damages, costs and reasonable attorney fees at best. This is an oblique reference to an unfair trade practice and does not refer specifically to double damages plus reasonable attorney fees There will be no penalty for landlords who refuse to return security deposits. We will be right back to where we were 30 years ago when the code was created.

2. There will be No Enforcement for Landlords to Give Tenants Notice of Building Code Violations.

The substitute takes the provision out of DATCP code. Once the same provision as appears in code is put into the statutes, the administrative agency cannot continue same provision in code. Under current law, for a violation of DATCP code, the tenant shall recover double damages, together with costs and reasonable attorney fees. S. 100.20(5). Under this proposal the penalty is only that this may constitute an unfair trade practice. Even then, there is no assurance that the tenant is entitled to double damages, costs and reasonable attorney fees – because this is an oblique reference to an unfair trade practice and does not refer specifically to double damages plus reasonable attorney fees. Under this sub. there will be no penalty or remedy where a landlord refuses to notify the tenant of building code violations

3. Senate Amendment 1 and Senate Substitute Amendment 1 – Landlords Can Immediately Dispose of Tenants Property

The substitute amendment, like the original bill, allows landlords to immediately dispose of tenants property that has been left behind. Amendment 1 says that landlords cannot do this, and must follow current law, where they do not include a notice in the lease that they may dispose of property immediately. This amendment does not solve the problem, because these provisions will simply be made a part of form leases. The problem arises when the tenant has to quickly leave the premises, not when the lease is signed. No one is anticipating that tenants will be in this dilemma when the lease is signed. What the law should do is to give the tenants notice when the tenant leaves, or by law, say that the tenant has a certain number of days to pick up the property. Some distinction should be made where only a couple of items left behind, as opposed to where the unit is full of furniture, which can make it difficult to re rent. Otherwise, the landlord may immediately dispose of a tenant’s property after the tenant removes from the premises – no matter whether there was a medical emergency or otherwise. Under current law, the landlord must give the tenant some time to pick up the belongings. This section makes no exception, no matter what the cause or how few things the tenant has left behind. Suppose the tenant needs more than one trip to move the belongings. Does not matter. Landlord can throw things out on the street immediately.

4. The Landlord Can Dispose of the Tenants Property Notwithstanding the Rights of a Merchant to a Lien on Rented Property.

It does not matter if a merchant has a lien on furniture bought on time. The merchant’s lien is overridden by the landlord’s right to dispose of the property immediately. So, the merchant loses out and tenants will not be able to buy furniture on time, because merchants will not sell furniture to them on credit for fear of this result.

5. No Municipality or Local Court May Enforce a Short Term Moratorium on Evictions

The Milwaukee County court system has had a moratorium during Christmas. Otherwise never heard of such a thing. The law should not preempt local municipalities from local control over short term moratoriums. This is a function of calendaring cases by the courts. This is a matter of local control by the municipalities and by the courts. This could also be a violation of the separation of powers, by the legislature intruding on the role of the judiciary in scheduling cases.

6. Not Only are Tenants Enforcement Rights Eliminated by the Remedy Section of the Substitute Amendment – DATCP’s Ability to Adopt Administrative Rules is Compromised.

Not only does the remedy section make any remedy available to the tenant a weak reference to being an unfair trade practice, it also prohibits DATCP from issuing an order or rule that CHANGES any right or duty under this chapter (the whole landlord-tenant chapter)! The term “change” is not a legal term. The law is that an agency may adopt rules that do not conflict with statutes or which do not exceed the agency’s authority. This use of the word change could
include an act by the agency to construe a statute – which is what agencies do, under their authority to implement statutes. This could mean that DATCP would be unable to issue any order or rule that construes any statute under the entire landlord tenant chapter of the statutes! Literally taken, this would eliminate DATCP’s entire landlord tenant administrative code! This is because DATCP’s authority is only to construe the statutes in adopting an administrative
code. That is the same authority any agency has in implementing statutes. Any landlord will be able to challenge any DATCP rule in court on grounds that it CHANGES a statute, if this substitute amendment is enacted.

Here’s another:

After working at the Tenant Resource Center since 1991, I have no idea what the laws will be if AB561 passes. It is full of inconsistencies, items that are unclear and unintended or unstated consequences.

Example 1: How is this going to work?

“A landlord shall provide to a new residential tenant when the tenant commences his or her occupancy of the premises a standardized information check-in sheet that contains an itemized description of the condition of the premises at the time of check-in.”

The very next sentence reads.

“The tenant shall be given 7 days from the date the tenant commences his or her occupancy to complete the check-in sheet and return it to the landlord”

So, who fills in the check in sheet, the landlord or the tenant? If both, how does that work?

Example 2: What does this mean?
“704.95 Practices regulated by the department of agriculture, trade and consumer protection. Practices in violation of this chapter may also constitute unfair methods of competition or unfair trade practices under s. 100.20. However, the department of agriculture, trade and consumer protection may not issue and order or promulgate a rule under s. 100.20 that changes any right or duty arising from this chapter.”

Generally speaking, 704 says things like the tenant has the right to exclusive possession of the property. Then DATCP rules say that the landlord has to give 12 hours notice to enter. Would that kind of rule, since it changes a right (right to enter?) or duty, no longer be able to be promulgated? What kind of rules would they be able to promulgate? Only rules that are not mentioned in 704?

Example #3: What does “shall, at the landlord’s discretion” mean?
704.27 Damages for failure of tenant to vacate at end of lease or after notice. If a tenant remains in possession without consent of the tenant’s landlord after expiration of a lease or termination of a tenancy by notice given by either the landlord or the tenant, or after termination by valid agreement of the parties, the landlord may shall, at the landlord’s discretion, recover from the tenant damages suffered by the landlord because of the failure of the tenant to vacate within the time required. In absence of proof of greater damages, the landlord may shall recover as minimum damages twice the rental value apportioned on a daily basis for the time the tenant remains in possession

I can’t really rap my head around that. What are the courts supposed to do with that? Award double damages if the landlord asks for it?

There’s more, there is much more. This bill is terrible. Here‘s the best synopsis I have been able to come up with so far.

Wondering what you can do? Well, voodoo? Cross your fingers? Curse? Put a curse on the legislators? Scream? I don’t know. Try calling your legislators and let them know how you feel! (Find out who your legislators are and their contacts here) This bill is awful not just for tenants, but for landlords too. It’s going to make a mess out of current tenant landlord law that is working just fine, if anything, there are needs for greater protections for tenants and some thoughtful tweaking of items for landlords – but this is just a blatant power grab by some greedy landlords in power.

By the way, I guess it has become widely understood that this was Vos’ bill from the beginning, he was just hiding behind others because of previous criticisms on his bill about attorney’s fees.