Does Senate Bill 541 take away tenants' rights to a day in court or prevent landlords from being cheated?

Boston resident Dottie G. Guild spent three years and four months in court suing her landlord for the right to affordable housing.

Now, she says she is defending her right to be heard in court at all.

She joined dozens of people both supporting and rallying against Senate Bill 541 before Massachusetts' Joint Committee on Housing and Urban Development on Monday.

The two factions have much invested in SB 541, which would require tenants to put rent in escrow accounts if they claimed code violations by their landlords.

Currently, if a tenant files code violations, he is legally allowed to withhold rent until a judge orders him to pay (which occurs once the code violations have been resolved).

Landlords argue that the bill would rectify the current situation, in which tenants can go months without paying--and then skip town.

If SB 541 passes, even if tenants disappear, the landlords can access their accrued rents in the escrow account.

However, tenants argue that the bill would take away their voice in court, since it requires tenants to have the rent in the escrow account--before they can take their landlords to court on code violation charges.

Tenants point out that a landlord could suddenly raise the rent should the tenant claim a code violation. Under SB 541, until the tenant funneled this heightened rent into the escrow account, the tenant's case would not be heard.

The bill, tenants argue, could thus price them out of the court system.

Cheating the System?

Supporters of the bill contend that tenants are currently given the opportunity to live for months rent-free by charging that minor code violations make their abodes uninhabitable.

The bill would only affect these tenants, not the honest ones, they say.

Sen. Robert A. Bernstein (D-Worcester), told the joint committee that this leniency toward tenants discourages many would-be landlords in Worcester from entering the market.

"When a tenant enters into a lease, they agree to pay x number of dollars every month--they don't get a bye or a free pass whenever they feel there are code violations; they get a free pass or damages when violations are decided by a court," he said.

Cambridge resident Skip Schloming, a member of the Small Property Owners Association (SPOA), describes the bill as one that would "stop extortion by tenants."

Schloming says that current law allows fraudulent tenants to live free for months, at the risk of bankrupting property owners.

The problems usually involve tenants who use code violation charges to evade rent, Schloming says.

"Tenants will get an eviction notice for not paying rent, and, instead of paying or leaving, they'll call the housing inspector," he says.

According to Schloming, these tenants cite small code violations--or even create their own--and landlords are required to fix them.

In the interim, he said, the tenants legally can withhold their rent.

"The worst case is that the tenant won't even let us or the repairmen in," Schloming says. "And when we finally fix whatever the problem is, another one appears."

"If you have a tenant living rent-free for six, eight, 10 months, it's devastating for a property owner," he adds.

SPOA is a 3,000-member statewide organization which was first formed in Cambridge to oppose rent control, which Question 9, a statewide referendum, ended in 1994. It now represents the interests of property owners who own one to 20 rental units.

Convergent Interests

Schloming and other SPOA members argue that the interests of small property owners coincide with those of low-income tenants--but those who do not fraudulently use code violations.

"Small property owners provide 75 percent of the rental housing in the Commonwealth," Schloming says. "And most of that is at the affordable end of the market."

Richard C. Ferrington '52, a Cambridge landlord, is quick to point out that property owners do not view the battle of the bill as a war against tenants.

"Most people don't act this way," he says, referring to the many upstanding tenants he has served over the years.

"If you didn't care about your tenants, you wouldn't provide good housing when rents weren't high enough to cover expenses--and I did it," Farrington says.

SPOA President Lenore M. Schloming '59 contended at the Monday hearing that the law will better landlord-tenant relations.

"Living rent-free does not help solve tenants problems, they eventually will move out," she said, adding that other problems such as bad credit may follow them.

Further, she added, the weight it would place on tenants is less than that currently placed on landlords.

"This bill will encourage landlords and tenants to find solutions and avoid long vicious litigation which helps no one," Schloming said.

The Opposition

Despite the landlords' contentions that the bill would only penalize fraudulent tenants, tenants' rights advocates argue that the bill renders all tenants mute in court.

Rep. Jarrett T. Barrios '90 (D-Cambridge), responded to Schloming's remarks and the entire bill with some reservations at the Monday hearing.

"What you're doing with this legislation is taking the right away from the tenant to dispute the rent they're escrowing," he said.

"It seems a radical departure from what I know as justice in this country," he added.

Most tenants agree that SB 541 would make it economically infeasible for them to bring many cases to court.

"It's the only instance where people must pay to have their claims heard by court," says Cambridge tenant Kevin Bradley, a member of Cambridge's Eviction-Free Zone, a tenants' rights organization.

"Our reading of this bill is that if a tenant does not pay every cent the landlord claims is owed, then he won't get before a judge," said Annette Duke of the Massachusetts Law Reform Institute, arguing against the bill Monday.

"This bill removes the judges' ability to hear both sides," she said. "What they're doing with SB 541 is taking away the power to hear."

Bradley also says the bill puts the tenants at the mercy of the landlords.

"We will have to escrow not the contracted rent, but what the landlord wants," he says.

A Case in Point?

Dottie Guild's case seems to prove Bradley's contention.

Guild, a Boston artist, says she believes her right to trial--without an escrow fund to back her up--is the only reason she still has an apartment.

For several years prior to 1995, Guild and her partner were residents of The Piano Factory, a South End artists' commune which landlord Simeon Breuner had built from an abandoned piano factory.

"We were very multi-cultural, and--unlike most communes, which are limited to the visual arts--very multi-media," says Guild.

Guild is a comedy writer who is now writing a biography of her partner Niko, a watercolorist who died of brain cancer in 1993.

The pair had lived in middle-income units, but when Niko developed cancer, they had to move into low-income units, Guild says.

According to Guild, Breuner had received $3.5 million in federal funding for The Piano Factory, on the condition that he maintain at least 88 middle-income units and 44 low-income units.

The Piano Factory, however, became very popular. According to Guild, Breuner illegally cancelled the middle- and low-income leases, increasing the rents of those units by 1,000 percent.

Had SB 541 been in effect, Guild says the residents of The Piano Factory would have had to put up hundreds of thousands of dollars of rent at the increased rate in order to bring their landlord to court.

"We wouldn't have had a case--we would have had our hands tied," she says.

But because SB 541 was not law, they were able to have their case heard without putting the money into escrow.

The court ordered Breuner to maintain the middle- and low-income housing rates until 2014, and Guild is still a resident of The Piano Factory.

She worries that other tenants will not have their day in court.

"This law is so incredibly anti-democratic, I can't believe we're considering it," Guild adds.

Guild says many properties with state-mandated below-market rents exist throughout the state. Should SB 541 become law, she says, their tenants will not have the recourse she did should their landlords change the terms of the leases.

"This is going to be a crisis throughout the state. We just happened to be the first, like a canary in a coal mine," she says.

The Days to Come

Yet Skip Schloming contends that SB 541 would not prevent cases like Guild's from coming to court.

"All it does is require that you escrow your rent to use code violations as a defense," he says. "A tenant is always entitled to a hearing in eviction disputes."

Barrios, however, says he believes that tenants who do not escrow their rent will have no case if the bill is passed.

"Tenants are precluded from bringing their claims to court," he says.

Nevertheless, Schloming predicts that the bill will pass.

"I think we very successfully got our point across," Schloming says. "There were, especially from Barrios, some little doubts that I think we can easily address."

Barrios does not expect the joint committee to act on the bill until June. If approved, at that point it may go to another committee before moving on to the full House and Senate.