A Deep Dive Into Governor Evers’ Emergency Order #15 – Temporary Ban on Evictions and Foreclosures

Posted by Tristan R. Pettit, Esq. in COVID-19 / Comments

My office has received a lot of questions about Governor Evers’ Emergency Order regarding a temporary ban on evictions and foreclosures in the last few days. There appears to be a lot of misunderstanding or confusion over the Order so I will attempt to clarify the Order and answer many of the questions that I have received.

First off, it is important to keep in mind that all we know for certain is what the Order says.  If the Order doesn’t state something or doesn’t even address the topic then we do not know for certain.  Everything else is just educated guessing, wishful thinking, or mere argument and speculation.  For ease of reference, I will refer to each of the eleven (11) numbered paragraphs of the Order separately. 

Evers’ Order went into effect on March 27, 2020 and continues for 60 days.

1. Landlords are prohibited from serving any notice terminating tenancy for failure to pay rent.

This one is pretty straightforward.  During the 60 day period of this Order, landlords cannot serve a tenant with a 5 day notice or a 14 day notice for failure to pay rent. 

This section of the Order does not address whether or not a landlord can talk with a tenant about not paying their rent, send the tenant a rent invoice, or a letter advising the tenant that rent was not paid.  I am not suggesting that Landlords do any of the above, I am merely stating what the Order says and does not say, as those are the questions that I am being asked.  So nothing in the Order prohibits a landlord from communicating with a tenant about unpaid rent.  The Order does prohibit a Landlord from sending a tenant a notice for failure to pay rent.

2. Landlords are prohibited from serving any notice terminating tenancy unless the notice is accompanied by an affidavit attesting to the reasonable belief, and the basis thereof, that a failure to commence eviction proceedings will result in an imminent threat of serious physical harm to another person.

Translated this means that a landlord cannot serve a 5 day notice or 14 day notice for a non-rent (or behavioral) breach unless the breaching behavior is so severe that to not move forward with evicting the tenant will result in an imminent threat of serious physical harm to another person. 

The Order does not provide any examples of what situations would fall under this narrow exception.  I assume that a landlord could move forward with serving a non-rent notice on a tenant if there was physical abuse of a tenant by another tenant.  I suppose that a Landlord could also serve a non-rent notice on a tenant if the tenant physically injured or threatened to injure a property manager, leasing agent or maintenance person.

Please keep in mind that a court will scrutinize any notice served and filed under this narrow exception on a case by case basis.  Due to the severity of the pandemic and the overwhelming need to self-isolate, I believe that a Court will require that a pretty high hurdle be met before they will allow such an eviction to move forward.  For instance, does the use of the word “imminent” in the Order preclude a Landlord from serving a non-rent notice on a tenant if the abuser has already caused physical harm to another?  Or will it be assumed that if harm has already occurred that it will continue to occur will meet this narrow exception? We just don’t know the answer to these questions; each judge will be analyzing each specific scenario separately and on a case by case basis.

It is important to remember that if a landlord has a situation where it believes there is an imminent threat of serious physical harm to another person, that the landlord must be willing to put the basis for its belief into a personal affidavit which must be signed before a notary.  

It appears that this section of the Order would also preclude a Landlord from serving a 28 day notice for any reason or no reason at all on a month-to-month tenant because such a notice would not be based on a reasonable belief of imminent threat of serious physical harm.

The question that comes up quite frequently and has landlords uncertain is whether or not a landlord can send a tenant under a lease for a specific term, a notice of non-renewal if the lease ends within the 60 day period of the Order.  A notice of non-renewal does not really terminate a tenancy (the fact that the initial lease period ends is what terminates the tenancy) however, if the point of the Governor’s Order is to keep tenants in their apartments and not have them out looking for a new place to live, then serving a notice of non-renewal when the end of the term is within the 60 day period, would be contrary to that.  Again, I do not know this for certain.  What about if the lease ends after the 60 day period?  Can a landlord serve a notice of non-renewal during the Order if it won’t apply until after the Order expires?  Probably so, but we don’t know for sure.  Please read section 5 below for further analysis of this issue.  

3. Landlords are prohibited from commencing a civil action of eviction unless the following conditions are met:

a. The eviction action is not based on a failure to pay rent, and

b. The judicial action seeking eviction is accompanied by an affidavit attesting that the eviction is not based on a failure to pay rent and to a reasonable belief, and the basis thereof, that a failure to proceed with the eviction will result in an imminent threat of serious physical harm to another person.

This section of the Order is pretty much the same as #1 and #2 above except it addresses the filing of an eviction action rather than the service of a notice terminating tenancy.  The same issues and concerns raised above would apply under this section as well.

A major concern that is not addressed in the Order, is what happens to the pending eviction lawsuits that were filed and served prior to the commencement of the Governor’s Order?  This is not addressed so we don’t know for certain. It is however important to remember that prior to the Governor’s Order, the both the Wisconsin Supreme Court and the Chief Judge of various counties throughout Wisconsin, also issued temporary emergency orders and that those orders will need to be reviewed also.  To my knowledge these other Orders do not specifically answer that questions either.  We will have to wait and see what happens with the pending evictions.  Most likely they will be adjourned but what about the service of process requirements that landlords must comply with?

4. Landlords may not deliver a writ of restitution to the sheriff, nor may the sheriff act on eviction orders unless the following conditions are met:

a. The eviction was not based on a failure to pay rent, and

b. The writ or restitution is accompanies by an affidavit attesting that the eviction is not based on a failure to pay rent and to a reasonable belief, and the basis thereof, that a failure to process with the eviction will result in an imminent threat of serious physical harm to another person.

The section of the Governor’s Order prevents a landlord that has already been granted a judgment of eviction and issued a writ from filing that writ with the sheriff for execution, unless it falls under the same narrow exception mentioned earlier - a reasonable belief that failure to proceed would result in the imminent threat of serious physical harm to another person.

A common question of many landlords that I have spoken with is what will happen to the writs that were issued by the court but not yet filed with the sheriff, or the writs that were filed with the sheriff but not yet executed, since a writ is supposed to be valid for 30 days from the date that it was issued.  Are the non-filed writs and the non-executed writs all going to become void during the 60 days of the Governor’s Order?  Can all writs that fall into this category be “stayed” until after the Order expires?  It doesn’t seem equitable to require a landlord to file a new eviction and obtain a new judgment of eviction and a new writ, when all of those matters occurred prior to the Governor’s Order. 

5. Nothing in the above order shall be construed to affect the operation of Wis. Stat.  § 704.25.

Wis. Stat. §704.25 is entitled “Effect of holding over after expiration of lease; removal of tenant.”  This is the section of the Governor’s Order that I feel is the most unclear.  One interpretation of this section is that a landlord can still serve a notice of non-renewal and/or file an eviction against a tenant that has held over beyond the term of their tenancy.  Another interpretation could be that any tenant that becomes a holdover during the 60 day Order will still be responsible for any damages incurred by the landlord as a result of their holding over?  If I had to guess I would say, the latter interpretation is probably the view that a court would take.  But again, we don’t know for certain.

Wis. Stat. § 704.25(3)  specifically addresses what the terms of the tenancy are when a tenant holds over and basically states that if the holdover tenant offers rent, and the landlord accepts the rent, that a month to month tenancy is created under the same terms and conditions as the original lease.

It is my opinion that the above paragraph is what the Order is referring to when it states that nothing shall be construed to affect the operation of Wis. Stat. 704.25.  But we do not know for sure. 

6. Remote Notarization is permissible for purposes of this Order

This section is reasonable in light of the goal to self-isolate.

7. Mortgagees are prohibited from requesting from commencing a civil action to foreclose upon real estate.

8. Mortgagees are prohibited from requesting or scheduling a sheriff’s sale of the mortgaged premises.

9. Sheriffs may not conduct sheriff’s sales of mortgaged premises nor ma sheriffs act on any order of foreclosure or execute any writ of assistance related to foreclosure.

I am pleased that Governor Evers addressed one major concern of landlords in these three sections of the Order – what happens to the landlord that cannot meet its financial obligations because it is not receiving rent payment from its tenants as a result of COVID-19?  While it is true that it will be extremely difficult for tenants to pay their rent if they have lost their job or had their hours cut, a large majority of landlords rely on their tenants’ rent payments in order to pay their mortgage, utilities, taxes, insurance etc.

This section of the Order prevents the landlord’s lender from foreclosing against the landlord‘s rental property during this 60 day period. Hopefully we will see an additional order or possibly legislation giving such a reprieve for the payment of taxes, insurance, utilities etc.  We all have serious concerns about whether or not we, our families, and our businesses will survive this pandemic.  Without further assistance the smaller landlords out there, which includes the majority of landlords, will not survive.

10. Nothing in this Order shall be construed to affect the ability to commence a civil action to foreclose upon real estate under Section 846.102 of the Wisconsin Statutes.

I have not received any questions related to this section of the Order and don’t feel that comment is necessary.

11. No provision in this Order shall be construed as relieving an individual of their obligations to pay rent, make mortgage payments, or any other obligations an individual may have under a tenancy or mortgage.

This section is key and unfortunately it is being overlooked by many.  Tenants are still responsible for paying their rent.  If they don’t pay their rent and if they don’t otherwise enter into some form a rent deferment agreement with their landlord, the tenant can still be evicted after the Order expires for not paying rent during the Order.  The same applies to landlords.  You still need to pay any missed mortgage payments at some time or else suffer the consequences. 

I have no idea how long this pandemic will last, but it is pretty clear that it will continue for the near future, and in the meantime many will be unable to meet their financial obligations.  The effect on the housing market and affordable housing, which was already in short supply, is going to be catastrophic and difficult to even think about.

Since it will be a while before the courts are handling evictions again, I hope that everyone reading this, both landlords and tenants, realize that it would be in everyone’s best interests to work together and come up with solutions that can keep everyone afloat until such time that we can once again stand closer than 6 feet.

Stay safe, stay healthy, and look out for one another.

T