Hanlon Niemann Blog | A Freehold, New Jersey Law Firm

By Christopher J. Hanlon, Esq. an attorney protecting the rights of the landlord

Don’t assume knowledge of a violation of a lease provision will allow you to avoid eviction.  A recent NJ decision involving a commercial landlord and tenant is significant, in part, because it originates from the Appellate Division and therefore it is binding statewide.   The Court considered a judgment entered by the lower court for possession in favor of the landlord.   The lease specifically prohibited the tenant from assigning or subletting any portion of its space and the adjacent exterior parking space without the written consent of the landlord.   The landlord alleged that the tenant subleased part of its space to an unrelated third party business without its knowledge or consent.   The tenant alleged that the landlord knew that the third party was an unrelated business co-occupying the space since the beginning of the lease and therefore, was chargeable with knowledge of the lease and thereby waived the enforceability of the “no-subleasing or assignment” provision in the lease.  The Court ruled (based on the facts of the case), that the landlord was entitled to evict the tenant for a material breach of the lease by failing to get his permission to sublease or assign this space.  

This case stands for the proposition that if a lease requires that the tenant or landlord give notice or perform an affirmative obligation in writing, each side better be able to prove that written notice was given to other.

For more information on this decision, contact Christopher Hanlon toll free at (888) 800-7442 or e-mail him at chanlon@hnlawfirm.com.

New Jersey law is very biased against Landlords.  One unintended and innocent mistake can be devastating to you financially and result in a dismissal of your case.

1. When the Clerk or Judge calls the calendar of all matters scheduled, if the landlord is present in the courtroom and the tenant is not, the tenant will be “in default.” In that case, a judgment granting the landlord possession of the leased property may be entered against the tenant after the landlord has filed an affidavit proving a right to possession.  If the tenant is present in the courtroom and the landlord is not, the landlord’s complaint will be dismissed without prejudice, meaning it will have to be filed again without penalty.

2. In non-payment of rent cases, the tenant has the right to pay the full amount of rent into court (or with the clerk) by the close of the business day that the trial is set for. Then the case will be dismissed.

3. A landlord may not evict a tenant based upon failure to pay any attorneys’ fees, costs or late charges, unless there is a lease provision which states that such fees are collectible as rent. Even if the lease allows such charges to be collected, the amount due as rent may be limited by a rent control ordinance, or in the case of public or federally-assisted housing, by federal law.

4. A landlord may decide to settle a case before court, but the decision is entirely voluntary. Any settlement should be reduced to writing and filed with the court. This will protect both parties in the event of a breach by the other. Most Courts require that the terms of the agreement be “placed on the record,” in open court. This is for the protection of both parties as well. A settlement agreement should be placed “on the record” as a matter of course if there are complex terms, or if the tenant is agreeing to vacate. An experienced landlord attorney like Christopher J. Hanlon should be present to protect you during any settlement.

5. If the tenant wishes to challenge the allegations or accuracy of anything stated in the complaint, including the amount of rent due and owing, the tenant has a right to a trial before a judge.

6. The entry of a judgment for possession means that a landlord may request the court clerk issue a Warrant for Removal to a Court Constable and the tenant can be evicted.

7. If a judgment for possession is entered, a Warrant for Removal may not be issued until three days later. The Warrant for Removal authorizes a Special Civil Part Officer (Constable) to lock out the tenant three days after the Warrant has been served on the tenant. Service of the Warrant is generally accomplished by the Officer leaving a copy at the tenant’s apartment. The lock out may not occur on a weekend or on a judicial holiday. Also, weekends and holidays are not counted in calculating the number of days before the Warrant can be signed or issued. This means that the tenant will be locked out at a minimum of eight days from the day judgment of possession is entered.

8. If a judgment for possession is entered after a trial, or because a tenant did not appear in court, or because the tenant agreed with the landlord to the entry of a judgment, a tenant has the right to apply to the court for a hardship stay at any time up to ten (10) days after the Warrant for removal has been executed (door locked!) The court may grant or deny the stay and the landlord has a right to be heard at the hearing on the application. A stay of the judgment means that the tenant will not be removed for as long as the stay is in effect. The court may grant a stay for up to a maximum of 6 months. During the period of the stay, the tenant must pay all back rent, pay the future rent on time, not disturb the neighborhood, and not damage the property. After the stay is over, the tenant may be evicted by the landlord through the Constable without any further judicial action unless the Court grants an extension not to exceed 6 months from the date of judgment.

9. The Court provides a list of social service agencies that may be able to help tenants find other housing or provide grant monies.

10. If a landlord and tenant agree to an eviction, a consent judgment for possession must be prepared. When this happens, the landlord must also submit, in writing, a sworn statement that one of the causes for eviction authorized in the eviction statute has occurred. This sworn statement must be filed before the court will accept the consent judgment. The sworn statement must also state that all fees and charges sought by the landlord are allowed by federal, state and local law, as well as the lease.

Are you a New Jersey landlord?  Do you have an eviction that requires legal assistance?  Then contact Christopher J. Hanlon toll-free at (888) 800-7442 or e-mail him at chanlon@hnlawfirm.com today to protect your interests.

By Christopher J. Hanlon, Esq. an experienced attorney for Landlords.

Commercial Landlords: Four Important Questions to Ask When a Tenant Files for Bankruptcy

With the downturn in the residential and commercial real estate market, a number of commercial tenants are experiencing financial difficulties. In turn, this can lead to problems for commercial landlords, most importantly, the tenant staying current with lease payments. This may then lead to the tenant filing for bankruptcy protection. If your commercial tenant files for bankruptcy, it is wise to have a strategy in place to not only minimize the time of non-payment, but also maximize the ability to receive rents and damages allowed under the Bankruptcy Code. 

Following are four (4) questions for a commercial landlord to consider whenever a commercial tenant files for bankruptcy protection:
1.    Have You Filed a Proof of Claim(s)?  As soon as the tenant/debtor files for bankruptcy protection, commercial landlords should ensure their rights to payment(s) by filing appropriate proofs of claim.  It is advisable to review with your attorney the current account history and lease to ensure all fees are being accounted. Landlords may be able to file up to three (3) different types of claims:
    a.    Pre-petition Claim. Section 502 of the Bankruptcy Code provides that creditors are permitted to file a proof of claim for all pre-petition charges and assessments owed.  If a tenant files for bankruptcy, the landlord is permitted to file a proof of claim for all fees and charges incurred prior to the filing date;
    b.    Post-Petition Administrative Claim.  Section 503(b)(1) of the Bankruptcy Code provides a creditor a priority claim for all “actual, necessary costs and expenses of preserving the estate”.  If the tenant remains in the premises after the bankruptcy and does not reject the lease, the commercial landlord may be allowed payment  ahead of other creditors for amounts incurred during this period; and
     c.    Post-Rejection Damage Claim. Section 503(b)(7) of the Bankruptcy Code provides a commercial landlord the right to be paid for “post bankruptcy rejection” damages. If the tenant rejects the lease, certain damages incurred and the remainder of the lease may be permitted priority before payment of certain claims.
 2.    Is the Debtor/Tenant Assuming or Rejecting the Lease?  Landlords should inquire whether the debtor/tenant intends to assume or reject the lease.  Bankruptcy Code Section 365 provides that tenants are permitted to assume a commercial lease, as long as they cure all post-petition defaults. If they reject the lease, then the landlord may be able to proceed with an eviction action to remove the tenant. However, landlords should know that the Bankruptcy Code permits the debtor 120 days to decide whether to assume or reject the lease, with an additional 90 day extension.  All told, this can leave the landlord sitting around for more than 7 months without payment.  If you’re not being paid, it may be advisable to have the Bankruptcy Court allow you to proceed with an eviction action. 
 

3.    Should you File a Motion for Stay Relief to Proceed with an Eviction?   The debtor/tenant may not advise their intent to assume or reject the lease.  As noted, during this time, the debtor/tenant can use the premises without paying anything.  The landlord is permitted to file a motion for “Relief from the Automatic Stay”.  This Motion, if granted, permits the landlord to resume or commence with a state court eviction action.

4.    What to Do with Items Left by a Tenant?  If the debtor/tenant leaves equipment, inventory or equipment at the premises, can you just throw it away? Does anyone have an interest in the left over items, like the debtor/tenants’ bank?   Can you recover storage fees? When a tenant/debtor files for bankruptcy, these left over items may be part of the bankruptcy estate. Gaining proper approval from the Bankruptcy Court, before disposing of the left over “junk” is essential to limiting liability.  For instance, the left over property may be secured by a bank, financial institution or creditor. You may want to have a UCC Search conducted to ascertain whether any security interest exists.  If security interests are discovered, it is advisable to give notice to those entities, possibly through a motion with the Bankruptcy Court.

These are just a few of the questions a New Jersey landlord should ask when a debtor files for bankruptcy.  By asking these questions at the start of the bankruptcy, landlords can limit the loss or liability; as well ensure their right to payment through the Bankruptcy Code. For more information and assistance contact Christopher J. Hanlon, Esq. toll-free at (888)800-7442 or e-mail him chanlon@hnlawfirm.com.  Act today!

By Fredrick P. Niemann, Esq. a New Jersey Franchise Lawyer

Although the FTC-required disclosure documents are mandatory for first-time purchasers of a franchise, there are no required government disclosure documents that must be furnished to the buyer of an existing franchise business. The seller of the franchise is not required to provide the would-be buyer with the franchiser’s disclosure document.

You will want to very carefully study the terms of the existing franchise contract between the existing franchise and the franchiser. How long is its remaining term? Is the price reasonable? Will the operator compete with you afterwards? How does it compare with new franchises the franchiser sells to others? Will you be acceptable to the franchiser? Franchisers invariably have right to approve the transfer or sale of a franchise, or even to negotiate the right to buy back the franchise, and you don’t want to be a seller’s stalking horse.

An investment in a franchise is a substantial commitment of your money, your time, and your reputation. Our advice is to retain a lawyer to assist you in the process. It usually pays for itself many times over.

If you have any questions, contact Fredrick P. Niemann, Esq. toll free at (888) 800-7442 or e-mail him at fniemann@hnlawfirm.com.  He is happy to answer your inquiries.

Punitive Damages Okayed in Probate Dispute Case:

By Fredrick P. Niemann, Esq. a New Jersey Probate Dispute attorney

Our New Jersey Supreme Court has ruled under what circumstances punitive damages can be awarded against a fiduciary involved with Wills, Trusts, Probate proceedings and lifetime transfers.

 
A lawsuit was filed against a doctor who was alleged to have persuaded an elderly woman to transfer a large home in Spring Lake, New Jersey to him in lieu of the local Volunteer First Aide Squad who was the prior testamentary beneficiary under her Last Will and Testament.  In its analysis, the Court concluded that the remedy of punitive damages is limited to situations where an individual (who is essentially a stranger to the testator) gains access to him or her through undue influence and then carries out a scheme to place himself or herself in a position to seize control of the testator=s (decedents) assets through a lifetime transfer or a bequest under their Last Will and Testament.  Generally punitive damage awards filed in the Probate Division of the Superior Court must be in compliance with the New Jersey Punitive Damages Act.  This remedy will be infrequent and limited to circumstances in which the person who received the lifetime gift or bequest is an individual who otherwise cannot be punished through a lesser available remedy by the Probate Court. Because of the unique facts of this case, an award of compensatory damages and potentially punitive damages was available.   This decision is significant for the proposition that Executors, beneficiaries of lifetime and testamentary gifts when obtained through undue influence, suspicious circumstances, etc.  can be held personally liable for punitive damages.

 
If you have any questions, contact Fredrick P. Niemann, Esq. toll-free at (888) 800-7442, or e-mail him at fniemann@hnlawfirm.com.  He is happy to answer your inquiries.

By Fredrick P. Niemann, Esq. a New Jersey Contract attorney

Can an e-mail (s) become a contract?  Good question.  Many business men and women think e-mails cannot bind them to a “deal”, thinking that only a written or verbal agreement can form a contract.  New Jersey’s law review begs to differ.  Today a company cannot claim a contract has been formed by the mere exchange of an e-mail(s).   In some cases, they may be correct.

In real estate contracts and leasing deals, when broker’s exchange e-mails often they assume that a formal contract or lease will be prepared and additional negotiations will take place specifying all of the important terms.  But in New Jersey, the law treats an e-mail and their exchange just as it would any other offer and acceptance.  The courts look to the content of the e-mail.  If you have an offer and acceptance, and all of the material terms of a deal are contained in the e-mail, you may have a valid enforceable contract even if you intend to “formalize” the agreement in a paper lease.  E-mail exchanges can sometimes (but not always) create a binding contract even if the parties intend to memorialize their agreement in a subsequent writing.

To help minimize the likelihood of being dragged into a contract lawsuit because of an exchange of e-mail(s), or to help you prevail if you are called into court by a dissatisfied customer who wants to claim a deal, there are several practical steps you can take.  First, you should make it clear, in your e-mail exchange, that there is no agreement, whatsoever, until a formal written document is prepared and duly signed by both parties.  Second, consider adding to your e-mail signature a statement such as this; “To the extent this e-mail discusses the terms of a proposed contract, the e-mail is not intended to bind the party sending the e-mail or its principal to a contract, which contract is expressly understood to be formed only upon the subsequent negotiation of a formal written document, duly agreed-to and signed (via handwriting) by both respective parties”.

New Jersey contract law is just beginning to address the use of e-mail(s) as part of contracts.  The law is generally many years (if not a decade) behind technological advancements.  It is anticipated that as society continues to develop new technologies, like text messaging, the law will slowly evolve as well.

Contact me personally today to discuss your contract matter.  I am easy to talk to, very approachable and can offer you practical, legal ways to handle your concerns.  You can reach me toll free at (855) 376-5291 or e-mail me at fniemann@hnlawfirm.com.

By Fredrick P. Niemann, Esq. a New Jersey franchise lawyer

In New Jersey and throughout all 50 states, the franchise agreement is the cornerstone document of the franchise relationship. It is this document that is legally binding on both parties, laying out the rights and obligations of each party. You will always find attached to the FTC disclosure statement a sample franchise agreement or presented separately. Either way, under Federal law, you are entitled to receive it as a prospective franchisee five business days before signature. You should have it reviewed by a lawyer familiar with New Jersey franchise matters–especially since most agreements are extremely one-sided in favor of the franchiser. No one should enter into a franchise and expect to have a fairly written contract.

The agreement will contain provisions covering, in considerable detail, the obligations of the franchiser (the company) and franchisee (you) regarding operating the business; the training and operational support the franchiser will provide (and at what cost); your territory and any exclusivity; the initial duration of the franchise and any renewal rights; how much you must invest; how you must deal with things such as trademarks, patents and signs; what royalties and service fees you will pay; tax issues; what happens if you should want to sell or transfer the franchise; advertising policies; franchisee termination issues; settlement of disputes; by the company, operating practices, cancellation, and attorney fees.

There is no standard form of franchise agreement because the terms, conditions, and the methods of operations of various franchises vary widely depending on the type of business involved. For example, franchises for printing, employment agencies, and automotive products will differ from the franchises for fast food service, convenience stores, or clothing.

Contact me personally today to discuss your franchise matter.  I am easy to talk to, very approachable and can offer you practical, legal ways to handle your concerns.  You can reach me toll free at (855) 376-5291 or e-mail me at fniemann@hnlawfirm.com.

By Fredrick P. Niemann, Esq. an Employment Law Attorney

Wrongful termination, Wrongful dismissal, Employment Law, Discharge, Wrongful Discharge, Rights of Employee to Private Life, Employer, Employee

 Many employees do not realize that employers in New Jersey may have the right to regulate and prohibit personal lifestyle choices after work and during their private time unless the conduct falls within a clear cut constitutional privacy protection or meets a clear mandate of public policy protecting private lifestyle choices.  Generally, the prohibited conduct relates to extramarital affairs, romantic relationships among co-workers, free speech, smoking bans and other private lifestyle choices.    All employers and employees are cautioned that the scope of the prohibited conduct will be closely reviewed by the Courts in New Jersey.   New Jersey seems to follow (as customary) its own thoughts on permissible versus impermissible conduct. 

In a leading case, the Court has indicated that while an employer is free to discharge an employee at will, the general rule must yield when an employer Aacts contrary to public policy in accordance with the leading New Jersey case of Pierce vs. Ortho@.  
Questions about what may or may not be permissible versus dischargeable private behavior by an employer?  Contact Fredrick P. Niemann a New Jersey Employment lawyer who directs the firm’s employment related issues.  He can be reached toll-free at (888) 800-7442 or by e-mail at fniemann@hnlawfirm.com.

Contact me personally today to discuss your employment matter.  I am easy to talk to, very approachable and can offer you practical, legal ways to handle your concerns.  You can reach me toll free at (855) 376-5291 or e-mail me at fniemann@hnlawfirm.com.