Rental Collections

 

Collections can be handled in one of two ways. First, when someone is evicted, you can pursue past due rent and damages through a “Second Cause Hearing” (the first cause being the eviction). If no eviction took place, you can sue for damages in small claims Court. In either case, this is where you go to Court and present your case to the magistrate and request judgment in your favor.

You can obtain past due rent and damages to the premises at a Second Cause Hearing or Small Claims Hearing. Past due rent can be awarded. You cannot get the full lease amount unless the tenant stayed in the premises for the entire duration of the lease. You can only get rent for the months the tenant lived in the unit and the months the unit remained vacant while trying to re-lease it. There is a duty to use best efforts to re-let the premises. You can also obtain judgment for any damage to the premises. The damage must be beyond ordinary wear and tear and we must prove that in Court. Typically you prove this through pictures of the damage along with invoices and testimony of the property manager as to the condition of the premises. You cannot collect for labor that is self-performed. Therefore it makes sense to use a maintenance person to perform your repairs. After all the evidence is presented the Magistrate will make a decision as to whether the amount requested is truly damage above and beyond ordinary wear and tear.

If judgment is granted, you then have to obtain information to collect on the judgment. You do this by requesting a Judgment Debtor Examination.  The Court sends out notice of the Judgment Debtor Examination, and a Court date is scheduled. If the Defendant shows up for the hearing, you then question the Debtor regarding their assets and income. If they have non-exempted income or assets (for instance, social security income is exempt, as are other government assistance programs) they can be garnished via bank garnishment or wage garnishment. If there is no money in the bank account at the time of the garnishment, you have to try again. For this reason, wage garnishment is a better choice. You can garnish up to 25% of a Debtor’s take home pay per period.

Many times, a Defendant is uncollectible. This means they either only have exempted income or you do not have information on their income and assets at all (for instance, if they fail to appear at the Judgment Debtor Examination). For this reason, the only good time to actually pursue a Second Cause Hearing is when we know for sure ahead of time that the Defendant has garnishable income/assets and we have their bank account or employment information ahead of time. This is very rare. For that reason, the best avenue for most cases is to turn the debt over to a Collection Agency.

A collection agency will do everything including cold calling and reporting to credit bureaus to collect the debt.  A person may still be uncollectible, so the collection agency is not always successful.

 

Ohio Evictions – Set Out Procedure

Once you have your court date and a writ is issued, the tenant will either leave voluntarily or will stay, forcing your to physically set them out. Set Out Procedure is essentially you, the landlord, contacting the Bailiff the day after the 3rd or 7th day of the writ, and asking to schedule a time to set out the tenant. In Hamilton County, you are required to bring people/employees to help move the property out, and boxes and/or garbage bags to put belongings in. They are put in the front yard and it is the tenant’s responsibility to remove them from the property. The Bailiff simply facilitates the procedure. You, as the landlord, WILL DO THE PHYSICAL moving of the property. Keep this in mind when determining how many people you want to help you with the set out. The more people, the faster the process goes.

My Music Favorites: Radiohead

It has been a while since I wrote a music post. So here you go!

Radiohead has a ridiculous amount of amazing music out there. These are just a few of my very favorites.

This is a somewhat newer song, “Lotus Flower.” I LOVE the video. However, not everyone thinks Thom Yorke is the fantastic dancer that I do.

Now on to some older songs. My current favorite song is “Let Down.” No video here, just the audio (and that’s all you need!)

Another one of my current favorites is “Fake Plastic Trees.” Here is a live version.

A somewhat famous song amongst folks in the age range of 25-35 is “Exit Music (for a film),” which was featured in the 90’s remake of Romeo + Juliet with Leonardo Dicaprio and Claire Danes. One of the best songs made for a movie ever. It is quite beautiful.

A favorite of many musicians’ is “Street Spirit (Fade Out)”

Finally, I leave you with “True Love Waits.”

I hope you enjoyed these videos! I enjoyed researching and choosing which to share with you!

What are the Proper Ways to Serve the Three Day Notice to Vacate for Non-payment of Rent

I was in Court this week on the eviction docket. I saw a case get thrown out because the Owner of the premises did not serve the Three Day Notice To Vacate the Premises (which is required when evicting for non-payment of rent) pursuant to the statute.

The Statute states O.R.C. 1923.04:” by certified mail, return receipt requested, or by handing a written copy of the notice to the defendant in person, or by leaving it at the defendant’s usual place of abode or at the premises from which the defendant is sought to be evicted.”

Please note that each Court has local rules which must be complied with. In many instances, certified mail is not allowed by the local rules. This is why it is important to consult with an Attorney prior to taking any action.

Further, if your notice does not comply with this section, and you are evicting for non-payment of rent, your case will likely be thrown out, and you will have to serve a new notice to vacate, the proper way.

Simple Steps Property Managers Can Take to Save Money on Attorney’s Fees

These are just a few steps you can take to limit the amount of time you spend communicating to your Attorney on administrative needs, thereby saving you legal fees. There will always be times that you must contact your Attorney, and you should. However, you should save time and money on the issues that do not require the legal expertise of an attorney and contact your Attorney for the true legal advice you need. These tips are primarily focused on the preparation for Eviction and Actions for Money Damages. Most of these are administrative in nature, and are good procedures to put into place amongst your staff to ensure an efficient and cost effective case with your Attorney.

  1. Keep every record relating to the tenant and the property. Keep it one file, the tenant file. This will save you time so you don’t have to scramble to find something when you are ready to evict and sue a tenant for rent or damages.
  2. Take photos. Take them before and after the tenant moves. These photos will go a long way toward proving that the damages to the unit are more than just normal wear and tear (which is the standard used to determine if the damages are to be reimbursed to the landlord from the tenant.
  3. Keep invoices. Every repair you make, or someone else makes, keep invoices for. Know the method of determining the cost of labor and parts. These are all items you will have to prove in a case against a tenant for damages to the unit. The Judge WILL ask about these items.
  4. Keep track of everything having to do with the tenant. Any correspondences, notices to vacate, spreadsheets showing payments and debits, invoices, work orders, etc. You never know in a case what information might become relevant. It all depends upon the “defenses” the tenant decides to assert at trial. If you have all this information in writing, it will improve the quality of the evidence of your case.
  5. Keep a log of when rent is due and when rent is received. If you get into the habit of accepting late rent payments, the law states that you must write a letter giving 30 days for the tenant to start paying on time, stating that late payments will no longer be accepted before you can evict someone for non-payment of rent. Records of the payments as well as the thirty day notice letter will help you prove your case in Court in the event the tenant brings up the point that you have always accepted late payments.

As you can see, with a few good policies and procedures in place, you can save a lot of time, improve the quality of your legal case, and hopefully save you a little money along the way.

Why Your Company Needs an Attorney

Many folks today either use a website to organize their Company, register (incorporate) their Company with the Secretary of State, fill in the forms themselves, or fail to incorporate at all, operating as a sole proprietorship or partnership. These options may seem like a good alternative to an Attorney as well as a money-saving measure, but in reality a company is taking a huge risk by failing to hire an Attorney that could lead to legal trouble or cost the company a great deal of money in the future. This is why you need to hire an Attorney to advise your business. The following are just a few reasons a Company needs an Attorney.

1. Protection from personal liability for the debts and liabilities of the company.

Failing to incorporate or organize your Company with the Secretary of State leaves you with NO protection from personal liability for the debts and liabilities of the Company. Essentially you, the individual, and the Company, are the same person, and therefore, you, as an individual can be held responsible for the debts of the Company. This includes your personal assets such as your home and personal bank accounts.

Further, simply incorporating or organizing your company with the Secretary of State is not always enough to protect you from personal liability. Most protection comes via the Code of Regulations (Corporation) or Operating Agreement (LLC). If you fail to enact one of these documents, the default provisions of the Ohio Revised Code will apply to your Company. Many times these default provisions are not in line with how you want to run your business and do not provide the full spectrum of protection that is available for your Company.  Inadequate or nonexistent Regulations or Operating Agreements can leave the business owner open to personal liability for the debts and liabilities of the Company.

2. Keeping you compliant with the rules and regulations applicable to your specific line of business.

Many industry specific regulations and laws may require additional planning to ensure your Company is in compliance with these requirements. Many new or existing business owners are completely unaware of these requirements, and an experienced Attorney can help you navigate these potential legal pitfalls.

3. An Attorney is more than a Legal Advisor, an Attorney is a Counselor for all areas of your business.

While an Attorney’s first duty is to provide the very best and thorough legal planning and advice, an important aspect of being an Attorney is counseling clients in other areas. For instance, your Attorney may have industry specific knowledge of best practices and/or advice of what has worked for clients in the past regarding business management. An Attorney can provide you with a wide range of advice on the business of running your Company.

4. An Attorney can provide you with high quality referrals to other Professionals your business may need.

Your company does not just need an Attorney. You also need an Accountant, Banker, and other Professionals. Your Attorney can provide you with quality referrals to Professionals that the Attorney has already researched and worked with in the past. This is invaluable if you don’t personally know one of these Professionals.

5. Your Attorney can save you money in the future by providing you with sound legal advice and documents now.

Many new companies choose to save money now by not retaining an Attorney. However, you will likely save money by hiring an Attorney now who can help you avoid legal problems in the future. Once a legal issue arises, it can be far more expensive to deal with than had you protected your Company from the beginning. Hiring an Attorney is an investment in the future of your Company.

This is not an exhaustive list of the benefits and services an Attorney can offer. A quality, ongoing Attorney Client relationship can potentially save you from many legal issues in the future by addressing them before they arise.