On January 22nd, after more than a year of debate in City Council, Philadelphia Mayor Jim Kenney signed into law an ordinance that seeks to provide greater protections from evictions to certain residential tenants in the City of Philadelphia. The ordinance amends Section 9-804 of The Philadelphia Code (“Unfair Rental Practices”) by creating additional requirements that residential landlords must meet before they can evict certain groups of tenants.
The changes to the ordinance prohibit evictions, notices to vacate, notices of non-renewal and/or notices to terminate a lease “of less than one year” without “good cause.” The ordinance provides nine specific instances that qualify as “good cause” to evict a tenant:
• Habitual non-payment or habitual late payment of rent;
• Breach of or non-compliance with a material term of the lease;
• Nuisance activity that substantially interferes with other tenants’ use of the property;
• Causing substantial deterioration of the property beyond normal wear and tear;
• After receiving written notice, the tenant refuses the landlord access for purposes such as inspecting for damage or assessing the need for repairs;
• Refusal to execute an extension of a written lease on materially similar terms;
• The landlord or a member of the landlord’s immediate family is going to move into the unit;
• Refusal to accept a proposed rent increase or other lease under certain circumstances; or
• The renovation of the unit under certain circumstances.
In the event the landlord believes good cause exists for termination of a lease, the Ordinance obligates the landlord to notify the tenant in writing before terminating the lease. From there, the tenant may challenge the landlord’s determination of good cause by filing a complaint in Municipal Court or with the Fair Housing Commission within 15 days of receipt of the notice of good cause. Importantly, a landlord’s claim of “good cause” is presumed true if supported by video or photographic evidence or a corroborating police report.
Because the amendment to the ordinance does not create any additional defined terms other than “good cause,” landlords should look to the Landlord Tenant Act of 1951(68 P.S. §250.512) and related case law for additional guidance. For example, while state law may allow a landlord to give a tenant a notice to vacate and institute eviction proceedings upon the tenant’s first failure to timely pay rent, a first offense may not qualify as “habitual” non-payment or late payment of rent under the Philadelphia Code’s Good Cause Eviction provisions.
Careful attention also should be given to whether the requirements of this ordinance apply to holdover tenancies. Generally, a tenant may not have a right to stay beyond the initial term of the lease. However, many leases, including those based on the National Apartment Association form, automatically convert the lease term to month to month at the expiration of the initial term unless one of the parties affirmatively opts out. In this circumstance and/or where a landlord provides notice to a holdover tenant that it is extending the lease on a monthly basis, the landlord may be exposing itself to the argument that it created a new lease with a term of less than one year and is now subject to the additional requirements of the amended Ordinance. To avoid this interpretation, landlords should consult counsel and may consider adding language in holdover clauses of leases of at least one year specifically stating that a holdover will result in an extension of the original lease, to pre-empt a conclusion that there is a new lease term.
In summary, while the “good cause” ordinance does increase protections for tenants in Philadelphia, landlords still have the ability to evict tenants for several reasons, provided that they comply with the notice requirements. While the question of whether an eviction is for “good cause” is fact-specific, the situations that give rise to “good cause” should be familiar to everyone active in multi-unit residential housing in Philadelphia County. The ordinance becomes effective on April 22nd.
If you have any questions or would like to discuss these issues, you can call Grant Phelan at 215.569.2096, firstname.lastname@example.org, or Brett Peanasky at 215.569.4292, email@example.com. Mr. Phelan is a Partner in the firm’s Litigation Department and devotes part of his practice to the resolution of real estate disputes. Mr. Peanasky is member of the firm’s Land Use Group and devotes the majority of his practice to counseling land owners concerning real estate development.
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