The CARES Act, enacted in response to the COVID-19 pandemic, introduced significant protections for tenants in federally subsidized housing. Section 4024(c)(1) of the Act provides that landlords may not require tenants in covered properties to vacate without providing a 30-day notice to vacate following the termination of the lease agreement due to rent defaults. This provision has raised critical questions about its application in conjunction with state-mandated shorter notice periods, such as Florida’s three-day notice to pay or vacate.
The recent cases of Newcastle Lake, LLC v. Donnell Carmichael, 28 Fla. L. Weekly Supp. 854a (Miami-Dade Cnty. 2020) and Denton Cove, LTD v. Gurges, 31 Fla. L. Weekly Supp. 549a (Franklin Cnty. 2024) serves as a pivotal example and provides clarity on this issue. This article explores how this case establishes the necessity of a distinct 30-day notice under the CARES Act, in addition to any shorter notice periods required by state law.
Which Properties Are Covered Under the Cares Act?
First, understand that under the CARES Act, the 30-day notice to vacate requirement applies to tenants living in covered dwellings within federally subsidized or federally backed housing. These include:
1. Federally Subsidized Housing Programs
- Public Housing (funded by HUD)
- Section 8 Housing Choice Voucher Program
- Section 8 Project-Based Rental Assistance
- Section 202 Supportive Housing for the Elderly
- Section 811 Supportive Housing for Persons with Disabilities
- Rural Development Housing (Section 515, Section 514/516, and Section 533/538 programs)
- Low-Income Housing Tax Credit (LIHTC) properties
2. Properties with Federally Backed Loans
- Multifamily properties (5+ units) with loans backed by:
- Fannie Mae (Federal National Mortgage Association)
- Freddie Mac (Federal Home Loan Mortgage Corporation)
- Federal Housing Administration (FHA)
- U.S. Department of Veterans Affairs (VA)
- U.S. Department of Agriculture (USDA)
When Must the 30 Day Notice to Vacate Be Delivered?
Under the CARES Act, the 30 Day Notice to Vacate must be delivered to the tenant at the same time as a notice to vacate. The statute states,
The lessor of a covered dwelling unit-
(1) may not require the tenant to vacate the covered dwelling unit before the date that is 30 days after the date on which the lessor provides the tenant with a notice to vacate.
Regarding a Notice to Pay situation, there is an issue here presented in the language of this statute, that is, whether the CARES Act notice must be delivered at the same time as the Notice to Pay as delivered or when the tenant has failed to “pay or vacate” as stated in the Notice to Pay.
There is no case law on this specific issue, so consult your legal counsel.
Keep in mind, in Florida, a tenant must be given an opportunity to pay back rent (known as the 3 Day Notice to Pay or Vacate) and to cure a curable violation (known as a 7 Day Notice to Cure). Under these situations, the Notice to Pay or the Notice to Cure, the tenant must first be given that opportunity to cure before the lease is terminated.
The Legal Question: Can Eviction Proceed After the State Notice Period?
Now back to the cases at issue.
The primary issue in these cases was whether a landlord could initiate eviction proceedings immediately after the expiration of the three-day notice to pay or vacate required under Florida law, provided the eviction itself did not occur before the end of the 30-day period mandated by the CARES Act.
The Court’s Decision: Newcastle Lake, LLC v. Donnell Carmichael
In this case, the court determined that:
- Section 4024(c)(1) of the CARES Act Requires a Separate 30-Day Notice: The court held that landlords of “covered dwellings” under the CARES Act must provide a 30-day notice to vacate to tenants in default. A “covered dwelling” is defined as any dwelling unit in a property participating in federal housing programs, such as the Section 8 Housing Choice Voucher program.
- Non-Compliance with the CARES Act Invalidates Eviction: Newcastle Lake, LLC had issued a three-day notice to pay or vacate, as required by Florida state law, but failed to issue the separate 30-day notice mandated by the CARES Act. The court found this omission to be a violation of federal law, leading to the dismissal of the eviction action.
Key Implications of Newcastle Lake, LLC v. Donnell Carmichael
This ruling highlights that the CARES Act imposes an independent federal requirement on landlords of covered properties, which supersedes conflicting or shorter state notice periods. Specifically:
- No Eviction Without a 30-Day Notice: The landlord must provide the tenant with a full 30-day notice to vacate, separate from the three-day notice to pay or vacate under state law. The 30-day period is not merely a delay on the enforcement of an eviction order; it is a distinct prerequisite for initiating eviction proceedings.
- Failure to Comply Leads to Dismissal: As demonstrated in this case, landlords who fail to issue the required 30-day notice cannot proceed with eviction, regardless of compliance with state law notice requirements.
Broader Significance
Newcastle Lake, LLC v. Donnell Carmichael is a definitive case addressing the intersection of state and federal eviction laws under the CARES Act. It clarifies that the Act’s protections are substantive and enforceable, ensuring tenants in covered properties are afforded an additional layer of security beyond state law.
For landlords, this case underscores the importance of adhering strictly to federal notice requirements. Issuing a three-day notice to pay or vacate under state law does not suffice for tenants in covered properties. Instead, a separate 30-day notice must follow, making it clear when the landlord intends for the tenant to vacate.
The Court’s Decision: Newcastle Lake, LLC v. Donnell Carmichael
The case of Denton Cove, Ltd v. Gurges is like Newcastle but provides more insights for landlords managing properties subject to the CARES Act. Below is a summary of the case, its implications, and lessons:
Case Summary:
- Background: Denton Cove, Ltd filed an eviction action against Courtney J. Gurges, a tenant in a public housing property covered by the CARES Act.
- Key Issue: The tenant argued that the landlord failed to provide the required 30-day notice to vacate as mandated by 15 U.S.C. 9058(c)(1) of the CARES Act, which remains in effect for “covered dwellings.”
- Court Rulings:
- The court denied the tenant’s motion to dismiss, recognizing the landlord’s statutory right to cure the notice deficiency by issuing a proper 30-day notice and amending the complaint.
- The tenant was ordered to deposit accrued and ongoing rent into the court’s registry. Failure to do so would waive all defenses to the eviction except payment but would not allow the landlord to execute a writ of possession before the expiration of the 30-day notice period.
- Even if defenses are waived for failure to pay rent into the registry, the CARES Act’s 30-day notice requirement remains enforceable, meaning no eviction can proceed until the notice period lapses.
Implications and Lessons for Landlords:
- CARES Act Compliance:
- The CARES Act’s 30-day notice to vacate remains applicable to “covered dwellings,” regardless of state law provisions or lease terms. Landlords must verify if their property qualifies as a “covered dwelling” under the Act and ensure compliance with its requirements.
- Notice Requirements:
- Before filing an eviction lawsuit, landlords must provide tenants with a 30-day notice to vacate. Failure to do so may result in delays, as courts are likely to allow landlords to cure such deficiencies before dismissing cases.
- Rent Payment and Tenant Defenses:
- Courts may require tenants to deposit rent into the registry to maintain defenses other than payment. However, this procedural step does not override the substantive 30-day notice requirement.
- Practical Strategy for Landlords:
- Ensure thorough knowledge of federal, state, and local laws applicable to the property.
- Address any notice defects promptly and amend complaints as necessary to comply with procedural requirements.
- Clearly document compliance with all statutory requirements to avoid procedural challenges and delays.
- Risk of Delays and Costs:
- Non-compliance with CARES Act requirements or state law can lead to delays in eviction proceedings, increased legal costs, and prolonged tenant occupancy without rental income.
- Tenant Protections vs. Landlord Rights:
- While landlords are protected against frivolous tenant defenses if rent is not deposited into the registry, substantive requirements like the 30-day notice cannot be bypassed.
Navigating CARES Act 30-Day Notice Rules for Evictions
These cases provide a critical precedent for courts and practitioners navigating the complexities of eviction under the CARES Act.
Newcastle Lake, LLC makes it evident that landlords must treat the CARES Act’s 30-day notice as a mandatory step in the eviction process (until this provision in the Act is repealed), distinct from and in addition to any shorter notice periods under state law. By failing to issue such notice, landlords risk dismissal of their eviction actions, as federal protections take precedence in covered properties.
The Denton Cove case underscores the importance of strict compliance with the CARES Act for landlords managing public or subsidized housing properties. Ensuring proper procedures are followed from the outset can save landlords from costly litigation and delays in evictions.