Bill > S280

Introduced Session

This bill would codify and expand upon the court-created doctrine of the implied warranty of habitability in order to enhance the use of the doctrine as a defense to residential eviction proceedings. This will help prevent the eviction of unsophisticated tenants and help ensure that rental housing in our State meets reasonable standards of habitability. Tenants have the right to safe, sanitary, and decent housing. New Jersey courts recognize that residential leases carry an "implied warranty of habitability." This means that a landlord has a duty to maintain the rental unit and keep it fit for residential purposes throughout the entire term of the lease and that the landlord must repair damage to vital facilities. If the landlord breaches the landlord's obligation of maintaining the property at an adequate standard of habitability, a tenant may withhold the rent or a portion of the rent to be used as a set-off, because of the deficient condition. If the landlord institutes an eviction proceeding for non-payment of rent, the tenant is entitled to use the landlord's breach of the obligation to provide a habitable residence as a defense and justification for the set-off (deduction of rental payment). An eviction is an actual expulsion of a tenant out of the premises. A landlord must have good cause to evict a tenant. There are several grounds for a good cause eviction. If a tenant fails to pay rent, the landlord may immediately take legal action to have the tenant evicted. Although a tenant may assert a breach of the implied warranty of habitability as a defense in a landlord's eviction action for non-payment of rent, the defense is rarely raised. Under the bill, a tenant may assert a breach of the implied warranty of habitability as a defense or set-off in a landlord's eviction action for non-payment of rent withheld. A tenant may assert a breach of the implied warranty of habitability with regard to any condition which commenced during the twelve months immediately preceding the filing of the eviction action, provided that the landlord had received prior actual or constructive notice of the condition. If a tenant proves a breach, the court would reduce the tenant's rental obligation to the reasonable rental value of the property in its defective condition, and the tenant would be entitled to an offset in the amount of the cost of all repairs made by the tenant which the landlord was obligated but failed to make. The rent reduction would be retroactive and continue prospectively until the landlord corrects the breach. Additionally, the bill provides that a tenant who asserts a breach of the implied warranty of habitability as a defense or set-off would not be required to immediately deposit outstanding rent with the court. Instead, the bill sets forth a process, which would include: a code enforcement official's inspection of the premises for the existence of code violations and defective conditions, and the preparation of a report identifying code violations and defective conditions, and documenting the extent to which the health or safety of residents are impaired or threatened by the condition of the premises. After the court's review of the report, and after providing the parties notice and an opportunity for a plenary hearing on the issue of breach of the implied warranty of habitability, the court would determine if a breach has occurred. If the court determines that a breach of the implied warranty of habitability has occurred, the court would:· order the reduction or return, as the case may be, of the rent claimed due for the months under consideration; · establish a reasonable payment schedule for the payment of the rental balance found due and owing; · specify each item of work, each action, or both, that a landlord must perform to remedy the breach;· establish a schedule for the commencement and completion of each item of work, each action, or both, necessary to remedy the breach; and order the landlord to commence and complete the specified items of work and actions in accordance with the established schedule;· order the tenant to deposit with the court all or a portion of prospective rental payments that will become due during the pendency of the schedule established for the commencement and completion of work, along with all or a portion of any rental payments which become due pursuant to a payment schedule established pursuant to the bill;· provide for the remedies available to either party should the payment schedule not be met without good cause;· transmit a copy of the code enforcement official's report, and other relevant information, to the Department of Community Affairs; and to any agency that administers a State or federal housing subsidy with regard to the residential property that is the subject of the action. The bill also empowers the court to compel the landlord to deposit with the court all or part of any State or federal housing subsidy which the landlord receives in relation to the residential property that is the subject of the action. The court would control disbursement of amounts deposited with the court to ensure the amounts are expended for the sole purpose of: providing and maintaining basic utilities and services to the tenants, including but not limited to water, heat, gas, electricity, and security; and completing each item of work, and undertaking each action, necessary to remedy a breach or breaches of the implied warranty of habitability. The court would institute appropriate controls to protect against fraudulent use of these amounts, which may include: requiring inspections and reports by code enforcement officials; requiring the landlord to submit documentation, such as estimates and receipts from contractors, to the court; and allowing tenants to review and comment on submitted documentation and the progress of work. The bill provides that if the court determines that some or all of the conditions that may justify the appointment of an administrator pursuant to P.L.1971, c.224 (C.2A:42-85 et seq.) or a receiver pursuant to P.L.2003, c.295 (C.2A:42-114 et al.) are present in the matter before it, the court must transfer the matter to the appropriate division of the Superior Court for expedited proceedings in accordance with the provisions of the applicable statute. If a matter is transferred to an administrator or receiver, control over the disbursement of amounts deposited with the court would be transferred to the administrator or receiver. Finally, the bill specifies that any agreement by a tenant or a prospective tenant of a dwelling waiving or modifying protections or rights related to the implied warranty of habitability are void as contrary to public policy.

AI Summary

Committee Categories

Brian Stack (D)*, 

Introduced in the Senate, Referred to Senate Community and Urban Affairs Committee (on 01/09/2024)

Official Document