Section 5-12-080 of the Chicago Residential Landlord Tenant Ordinance sets forth the requirements a that Chicago landlords covered by the ordinance must follow. Among these are the requirement to provide a receipt for a deposit; to keep the deposit in a segregated account; to pay interest on the deposit; to return the deposit within a prescribed time period or to properly deduct from that deposit; and to properly transfer the deposit upon a change of ownership of the property.
Section 5-12-080(f) provides:
"If the landlord or landlord's agent fails to comply with any provision of Section 5-12-080 (a) - (e), the tenant shall be awarded damages in an amount equal to two times the security deposit plus interest at a rate determined in accordance with Section 5-12-081. This subsection does not preclude the tenant from recovering other damages to which he may be entitled under this chapter."
Thus, in addition to the regular damages a tenant can recover for a landlord's violation of the ordinance, a tenant can also recover a penalty of two times the deposit as a penalty. (As an aside, the ordinance also provides elsewhere that a prevailing tenant can recover attorney's fees and court costs from the landlord)
I have found that when a landlord violates the ordinance, he or she usually does it in a big way. That is, if the landlord fails to return a deposit, it is also likely that the landlord did not provide a receipt for the deposit, that the landlord probably commingled the deposit and that the landlord likely violated many of the other requirements of the CRLTO.
Accordingly, many tenant's attorneys will bring a multiple count complaint against a landlord for various violations of the CRLTO. Until recently, these attorneys would plead for (and sometimes get) a penalty for each and every violation of Section 080 of the ordinance.
In the middle of 2006, a case was decided by the Illinois Appellate Court, KRAWCZYK v LIVADITIS, that clarified the situation. In that case, the Court followed two prior appellate decisions and determined that "the payment of a security deposit is a singular event and the RLTO does not specify double damages for "each" violation of 5-12-080".
Thus, a landlord can only be penalized once for violating Section 080 of the ordinance, regardless of the number of counts against the landlord. Following the KRAWCZYK ruling, a landlord who commingles a security deposit, does not provide a receipt for a deposit and fails to pay interest on the deposit will only be charged with a single penalty of two times the deposit (in addition to any other legal damages).
I am not sure I agree with the court's reasoning in this case. Frankly, the application of a single penalty actually encourages a landlord to violate the ordinance. Because ordinance violations cannot be cured, the penalty has a chilling effect on landlords becoming compliant.
For example, a landlord who commingles (and thus, has violated the ordinance and now owes two times as a penalty if sued) has no incentive to later segregate the account (except to segregate it and hope the statute of limitations passes) and even less incentive to pay interest or follow any of the other requirements of Section 080 because no matter what the landlord does, the landlord is on the hook for a penalty capped at two times the deposit.
Regardless of my belief that the decision has a chilling effect on landlord compliance, I am amazed at the number of tenant's attorneys who try to bull landlords with multiple claim counts and wild assertions that they are due the penalty for each violation. I recently spoke with another attorney dealing with a four count complaint. The tenant's attorney offered the landlord's attorney to settle the case, based on a security deposit approximately $1000, for about $10,000 claiming that he was entitled to eight times the deposit if he prevailed on all of the counts. Either this tenant's attorney is not very smart or he is smart like a fox. Landlords need to be careful of traps like this one.
If the landlord's attorney merely stipulated to the violation, he likely would pay no more than $3000 plus some interest and some minimal attorneys fees. Some deal!
Friday, September 21, 2007
Sunday, September 16, 2007
Major changes to evictions in Cook County
Evictions in Cook County are never fun and are never fast - just ask any landlord. Until this year, the Sheriff typically enforced a court order for possession in about three weeks. Currently, the timeframe for removing a tenant in Cook County is more like six to ten weeks. Within the last few months, I have had the unfortunate opportunity to witness some serious delays in the enforcement of orders for possession by the Sheriff of Cook County.
In at least two cases, my clients have reported that despite thier presence to meet and "greet" the Sheriff (Having a "greeter" on behalf of the landlord is a requirement of the Sheriff in the enforcement of the order for possession obtained in an eviction order), the Sheriff did not appear to enforce the order. Upon checking into the situation, in both cases, the Sheriff indicated that he was present to enforce the orders and no one was at the property to meet him, so the evictions were called off. That means we need to pay an additional fee and get back at the end of the line. To add insult to injury, the landlords took time from work and were present at the property all day! It is possible that the Sheriff is telling the truth (ie. the landlord was present and the sheriff was present and they were unable to recognize each other). Unfortunately, there is no way to coordinate this process with the Sheriff. The Sheriff's eviction desk is of no help (they can tell you what happened the day after it happens, but they do not coordinate "just in time evictions"), so the system is, at best, handicapped.
In another recent case, the Sheriff called to indicated he would be out to evict the tenant "tomorrow". On the morning of that expected eviction, the Sheriff called my office to tell me that the eviction was cancelled and that the Sheriff would handle the eviction "tomorrow". After spending half a day at the building on the prior date, my client sat at the property on the new eviction date from 8am to 2pm (the time period provided by the Sheriff). The Sheriff never appeared. As one would expect, the landlord was fairly upset. When I followed up with the Sheriff's office the next day, they indicated that they were unable to make all of the evictions scheduled that day and that they would reschedule it "some time in the future". The Sheriff had no further information. Unfortunately, a short time after the two failed dates, the eviction order became "stale" (too much time had elapsed between the entry of the order and enforcement). The expiration was, in large part, due to the fact that the Sheriff failed to enforce the order in a timely fashion. I must admit that the tenant added some time with some fairly frivilous motions to extend their stay. As a result, the landlord had to motion the court to extend the court order, give notice to the tenant (adding to the landlord's expense in attorney fees and costs and providing yet another opportunity for the tenant to delay or stall the process) and the order could then be re-placed with the Sheriff (and we would get back in line at the beginning to wait again).
Luckily for us, the tenant got tired of waiting for her things to be thrown on the street and decided to leave on her own.
The current delays for the enforcement of an eviction are akin to those that occur in the winter months as a result of inclement weather and the Holiday moratoreum (extremely long). I don't fault the Sheriff for this as I suspect that the volume of evictions is overwealming considering the state of the economy.
As of July 19, 2007, the Sheriff has implemented a new procedure, I suspect, to increase the number of evictions that can be performed in a day and to reduce the current backlog of evictions. Prior to the new procedure, the Sheriff actually moved the tenant's property from an apartment as part of the eviction.
Effective August 06, 2007 the Cook County Sheriff’s Office will no longer arrange moving services for evictions. Landlords are now responsible for making arrangements to have the tenant's personal property removed from the real property after the Sheriff has enforced the Order for Possession and tendered possession of the real property to the plaintiff. In conjunction with the change, the cost of an eviction has decreased from a deposite of $225 to $60.
Despite my hope that the new rule will reduce the long wait for Sheriff enforcement, I suspect that landlords will now face a slew of new problems relating to the actual eviction of their tenants.
Two problems come to mind immediately.
First, the landord will have to deal with the problem of actualling moving the property. Likely, this will require the landlord to employ a professional moving company or some form of paid movers. I assume that the professionals will charge a greater amount than the Sheriff had charged, thereby increasing the landlord's eviction costs. The landlord will also have to determine when and where to actually remove the property. Should the landlord wait 24 hours? Should the landlord do it immediately? Should the landlord store the property and give the tenant an opportunity to retrieve the property? Should the landlord move the property to the curb or ally? A spokesman for the Sheriff recently indicated that once the eviction is processed by a Sheriff's officer, the landlord is free to move the property to the curb or ally regardless of weather conditions or other circumstances.
Second, landlords may have to deal with the recently dispossessed tenant's claims of property damage or theft by the landlords. It is easy for a tenant to claim that he or she had an expensive television and lots of cash among the tenant's possessions and can claim that the landlord stole those items or broke them while transporting them to the curb. Because the Sheriff will not be present, tenants and landlords could be prone to physical confrontation over the tenant's personal property.
I don't know how these issues will shake out, but I am certain that until some procedure is formalized, landlords and tenants will get into further disputes.
In at least two cases, my clients have reported that despite thier presence to meet and "greet" the Sheriff (Having a "greeter" on behalf of the landlord is a requirement of the Sheriff in the enforcement of the order for possession obtained in an eviction order), the Sheriff did not appear to enforce the order. Upon checking into the situation, in both cases, the Sheriff indicated that he was present to enforce the orders and no one was at the property to meet him, so the evictions were called off. That means we need to pay an additional fee and get back at the end of the line. To add insult to injury, the landlords took time from work and were present at the property all day! It is possible that the Sheriff is telling the truth (ie. the landlord was present and the sheriff was present and they were unable to recognize each other). Unfortunately, there is no way to coordinate this process with the Sheriff. The Sheriff's eviction desk is of no help (they can tell you what happened the day after it happens, but they do not coordinate "just in time evictions"), so the system is, at best, handicapped.
In another recent case, the Sheriff called to indicated he would be out to evict the tenant "tomorrow". On the morning of that expected eviction, the Sheriff called my office to tell me that the eviction was cancelled and that the Sheriff would handle the eviction "tomorrow". After spending half a day at the building on the prior date, my client sat at the property on the new eviction date from 8am to 2pm (the time period provided by the Sheriff). The Sheriff never appeared. As one would expect, the landlord was fairly upset. When I followed up with the Sheriff's office the next day, they indicated that they were unable to make all of the evictions scheduled that day and that they would reschedule it "some time in the future". The Sheriff had no further information. Unfortunately, a short time after the two failed dates, the eviction order became "stale" (too much time had elapsed between the entry of the order and enforcement). The expiration was, in large part, due to the fact that the Sheriff failed to enforce the order in a timely fashion. I must admit that the tenant added some time with some fairly frivilous motions to extend their stay. As a result, the landlord had to motion the court to extend the court order, give notice to the tenant (adding to the landlord's expense in attorney fees and costs and providing yet another opportunity for the tenant to delay or stall the process) and the order could then be re-placed with the Sheriff (and we would get back in line at the beginning to wait again).
Luckily for us, the tenant got tired of waiting for her things to be thrown on the street and decided to leave on her own.
The current delays for the enforcement of an eviction are akin to those that occur in the winter months as a result of inclement weather and the Holiday moratoreum (extremely long). I don't fault the Sheriff for this as I suspect that the volume of evictions is overwealming considering the state of the economy.
As of July 19, 2007, the Sheriff has implemented a new procedure, I suspect, to increase the number of evictions that can be performed in a day and to reduce the current backlog of evictions. Prior to the new procedure, the Sheriff actually moved the tenant's property from an apartment as part of the eviction.
Effective August 06, 2007 the Cook County Sheriff’s Office will no longer arrange moving services for evictions. Landlords are now responsible for making arrangements to have the tenant's personal property removed from the real property after the Sheriff has enforced the Order for Possession and tendered possession of the real property to the plaintiff. In conjunction with the change, the cost of an eviction has decreased from a deposite of $225 to $60.
Despite my hope that the new rule will reduce the long wait for Sheriff enforcement, I suspect that landlords will now face a slew of new problems relating to the actual eviction of their tenants.
Two problems come to mind immediately.
First, the landord will have to deal with the problem of actualling moving the property. Likely, this will require the landlord to employ a professional moving company or some form of paid movers. I assume that the professionals will charge a greater amount than the Sheriff had charged, thereby increasing the landlord's eviction costs. The landlord will also have to determine when and where to actually remove the property. Should the landlord wait 24 hours? Should the landlord do it immediately? Should the landlord store the property and give the tenant an opportunity to retrieve the property? Should the landlord move the property to the curb or ally? A spokesman for the Sheriff recently indicated that once the eviction is processed by a Sheriff's officer, the landlord is free to move the property to the curb or ally regardless of weather conditions or other circumstances.
Second, landlords may have to deal with the recently dispossessed tenant's claims of property damage or theft by the landlords. It is easy for a tenant to claim that he or she had an expensive television and lots of cash among the tenant's possessions and can claim that the landlord stole those items or broke them while transporting them to the curb. Because the Sheriff will not be present, tenants and landlords could be prone to physical confrontation over the tenant's personal property.
I don't know how these issues will shake out, but I am certain that until some procedure is formalized, landlords and tenants will get into further disputes.
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