The spread of Coronavirus (COVID-19) had a crippling impact on small businesses in the State of Maine. Most small businesses are lean with tight margins, to begin with. It doesn’t take much to disrupt normal day-to-day operations and feel the impact, especially on their bank accounts. Among those small businesses feeling the squeeze here in Maine, are those operating and maintaining rental properties.
During the COVID-19 lockdowns, when the State banned all evictions and tenants stopped paying rent, landlords were forced to confront the consequences. In April, Governor Mills took steps to keep tenants in their homes as the impact of COVID-19 continued to create financial hardships across the State.
Executive Order 40 FY 19/20
This order sought to protect some tenants against whom eviction actions had been taken prior to the impact of COVID-19 and all those following the Law Court’s ban on eviction matters effective March 18, 2020.
The concern was that tenants could not afford their rent due to the financial hardships brought about by COVID-19. In this blanket approach, the Governor’s Order was a lifeboat for those it intended to protect. It was also a loophole for others who began to live “rent-free.”
Although the Governor’s Order did not relieve a tenant of their legal obligation to pay rent, it created a pretext for some to avoid making payments altogether by blaming their missed rental payments on COVID-19. When, in fact, their financial circumstances never changed.
These included tenants who had not made payments prior to the financial downturn brought on by COVID-19 who essentially exploited the new executive order. As a result, landlords were left trying to make ends meet and continue with routine maintenance with no income to compensate for it.
The government’s goal has been aimed at preventing evictions and protecting those who struggle through the economic downturn has been admirable, to say the least. The repercussions have been felt by many of those who depend on rental income to support their businesses and families.
There is no question that more often than not, landlords are vilified as heartless corporations. The majority of the landlords in the State of Maine are small business owners. They utilize the income generated from these rental properties to feed their families and support their own financial obligations.
Phased Management Plan
In essence, when the Governor sought to protect tenants, the aim simply shifted the financial burden to those who she felt could financially endure through this challenging time. As time goes on, it has become apparent that some landlords struggle just as much, if not more than their tenants. In addition to the Governor’s actions, the Law Court also suspended eviction cases effective March 13, 2020.
That Order was later modified under the “Phased Management Plan” (the “Plan”) issued on May 27, 2020. The Plan provided that beginning in Phase 4 (August 3-September 4, 2020) the Court would lift the restriction on scheduling and hearing evictions. To that end, the Governor issued an additional Order dated July 30, 2020, effective August 3, 2020, which repealed and replaced Executive Order 40 FY 19/20.
The Good News?
Landlords can now proceed with evictions. Procedurally, eviction matters in Maine changed since the lockdown. The Governor’s most recent Order requires a landlord otherwise required to give a 30-day notice to quit to a tenant “at-will” (no lease) under 14 M.R.S. Sec. 6002, an additional 15 days, or 45 days total.
Additionally, the provision under 14 M.R.S. Sec. 6002 (1)(C) requiring a landlord to give a 7-day notice to a tenant for a rental arrearage is now extended to 30 days. The Law Court also now requires landlords to complete a Forcible Entry and Detainer Cares Act or Federal Program Verification along with the Complaint.
This certifies under oath that the property involved in the matter is not a “covered dwelling” or otherwise subject to federal moratoria on evictions. Following the filing of the Complaint and the Verification Form, instead of being automatically scheduled for a hearing, all eviction actions will now be scheduled for initial telephonic status conferences. Unless otherwise ordered by the court.
Michael Hockenbury, Esq.