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Dealing With Equitable Defenses

| Jun 5, 2020 | Firm News |

June Landlord just called my office to ask about her case.  She told me that she had a Section 8 tenant who has lived in her apartment for 6 years.  Tom Tenant has 2 children and a run of bad luck.  Tom’s portion of the monthly rent is $300.00 and he is now behind three month’s rent and owes $900.00.  On top of this Tom Tenant now has a legal aid attorney who has filed papers with the court claiming a special defense.  Namely – Tom Tenant alleges that he can make the landlord whole, he has nowhere to go and that equity should prevent his loss of the apartment.  June wants to know what equity is and how it could possibly keep her from obtaining her apartment back?

Equity, while not a new legal defense, has become a common defense alleged by tenants.  In particular, the tenant often claims that unusual circumstances have intervened to make payment of rent on time and in full difficult or impossible.  Additionally, the tenant often claims that he will lose a valuable subsidy if evicted and that if he is permitted to stay the landlord will be reimbursed or made whole, in a relatively short period of time.  Lastly, the tenant often states that the loss to the landlord (meaning waiting for her money) is outweighed by the loss to the tenant (losing his housing and his subsidy) and that therefore the court should exercise its equitable powers and fashion a remedy to permit the tenant to remain in the premises, provided payment is made.

As the courts have dealt with these equitable defenses, the law of equity has evolved.  In particular, the courts have looked at a number of factors in weighing an equitable defense claim:  1.  The delay in payment to the landlord must have been slight and reasonable; 2.  The loss caused little or no damage to the landlord; 3.  The loss to the landlord was due to inadvertence or negligence and not gross or willful; 4.  If the court did not grant relief to the tenant it would result in such hardship to the tenant as to make it unconscionable to enforce literally the conditions of the lease; 5.  Whether in the absence of equitable relief, a party will suffer a loss wholly disproportionate to the injury to the other party; 6.  Whether the injury to the landlord is reparable (i.e. payment of money); 7.  The tenant seeking equity must have clean hands; 8.  The tenant must be in good faith in curing or attempting to cure the default or there is a good faith dispute over the meaning of a lease; and, 9.  If the tenant cannot make a full tender to the landlord of the arrearage, then there must be a good reason to believe that the landlord will be made whole with reasonable protection to the landlord.

In June’s case against Tom Tenant, she should be prepared to address each of the nine elements cited above in order to convince the court that the equities should weigh in her favor.  June needs to keep in mind, that, in order to assess and argue each of the elements discussed in this article, she will need to be sure to elicit evidence from Tom Tenant that is favorable to her case and impairs the defendant’s equity claim.  Also, June should be sure to put forth evidence before the court that can be used to tilt the scales of justice in  her favor.  For instance, June should testify about the fact that it has been three months since she received any rent and how it is making it hard to pay her bills and how the tenant has made no effort to make her whole in a prompt manner.  This type of evidence will help to show the court how the default has hurt June.

Obviously, when dealing with a complex defense, such as equity, it is a daunting task for any landlord representing herself before the court, and qualified legal counsel is always encouraged.