Major changes are coming to the multi-family property industry today. Governor Phil Murphy is set to sign Assembly Bill A3859. This bill prohibits lockouts during a Governor-declared State of Emergency. Once signed into law, multi-family properties owners can expect the Governor Murphy to immediately impose a lockout moratorium. It is important the landlords and tenants understand what A3859 prohibits and what it does not.
1. Eviction Actions Can Be Still Initiated: A3859 does not prevent landlords from filing eviction actions. Instead, it stays the enforcement of a judgment of possession (no lockout) until the State of Emergency lapses. Technically, A3859 requires that the Governor issue an order triggering the moratorium—but this is a near certainty.
2. The Moratorium is Not Indefinite: A3859 allows the Court to proceed with a lockout “in the interest of justice.” While this term is not defined, we can expect that eviction cases for causes other than nonpayment (damage to apartment, assault on landlord–to name two) may be enforced in the “interest of justice.” Non-payment of rent cases are the most likely to be affected. The overwhelming majority of these cases will not proceed to lockout during the State of Emergency. Unless some exceptional circumstances are present (for example, a large pre-Coronavirus panic balance; a property on the brink of insolvency and similar exceptional consequences), landlords and tenants should expect that any pending or to-be-initiated nonpayment case, will be subject to the moratorium.