Author: Lawrence D. Wood, Legal Asssistance Foundation of Metropolitan Chicago
Last updated: December 2004
If you are representing the defendant in a forcible action and she has a strong defense, you may be able to resolve the case by filing a dispositive motion. But if that is not an option, and you and your client are concerned about the risks involved in proceeding to trial, you may want to negotiate a settlement agreement.
All settlements involve compromise. "No party obtains what he alleges to be equitably his. Parties agree to accept less than their full claim in lieu [sic] of foregoing litigation." Sheffield Poly-Glaz, Inc. v. Humboldt Glass Co., 42 Ill. App. 3d 865, 356 N.E.2d 837, 842 (1st Dist. 1976). To negotiate a favorable settlement on your client's behalf, you must understand what she can and cannot afford to give up.
If your client lives in public housing or a Section 8 project-based development --and thus enjoys both an automatically renewing lease agreement and a rental subsidy that is tied to her unit -- she cannot afford to vacate the premises, regardless of what the plaintiff is offering in return. But if your client lives in private housing, it may be in her interest to offer the plaintiff possession of the premises in exchange for either an extended period of time within which to move or some other benefit. Similarly, if your client has a Section 8 Voucher, she may be willing to vacate the premises because she can move without losing her rental assistance.
Because settlement strategies vary so much depending on the kind of housing involved, this section addresses each housing type separately. It then concludes with a short review of the more important issues.
Tenants who live in public housing or Section 8 developments enjoy automatically renewing lease agreements that cannot be terminated except for good cause, and valuable rental subsidies that run with the premises. These tenants are by definition poor -- they would not otherwise qualify for subsidized housing -- so when threatened with eviction they face the loss of the only decent housing they can afford.
If you are trying to negotiate a settlement on behalf of such a tenant, you should advise her against offering to vacate the premises in exchange for some benefit that will almost certainly be much less valuable than her subsidized tenancy and endless lease agreement. What you can advise her to offer depends on the grounds for eviction.
If your client is facing eviction for nonpayment of rent, remind the plaintiff that litigation is expensive, and that even if he wins at trial he cannot recover the costs of litigation (or unpaid rent) from a defendant who is financially eligible for subsidized housing and therefore almost certainly judgment-proof. (If you are representing a tenant who lives in Chicago, point out that a local housing ordinance actually prohibits forcible judges from awarding attorneys' fees to prevailing plaintiffs. See, Residential Landlord and Tenant Ordinance, Municipal Code of Chicago, Title 5, Chapter 12, at 5-12-180). Suggest to the plaintiff that he settle the case by allowing your client to stay in the premises and satisfy her debt over time. (If it seems necessary and your client can afford it, offer to reimburse the plaintiff for his court costs or even a portion of his attorneys' fees.) If you are able to negotiate such a settlement, draft an agreed order that clearly sets forth the terms of a payment plan and dismisses the underlying forcible action with leave to reinstate if your client fails to comply with this plan. To see a sample of such an order, click here.
If your client is facing eviction because she committed some other material lease violation -- anything from making too much noise to engaging in criminal drug-related activity -- you may want to advise her to offer to go on "probation" for some period of time. If the plaintiff accepts this offer, draft an agreed order that dismisses the underlying action with leave to reinstate if your client commits another material lease violation within the next six months or year. The order should clearly provide that, if the case is reinstated, the plaintiff may not rely at trial on any incident that occurred prior to the date on which the order is entered. If the case you are settling is set to go before a jury, the plaintiff may want the dismissal order to provide that, if the case is reinstated, your client will waive her right to a jury trial. Whether you advise your client to waive this right depends on the strength of your negotiating position, but you should never waive your client's right to conduct discovery. The plaintiff may also suggest that your client agree to let him accept rent that accrues after the order is entered without prejudice. Resist this suggestion, because you will want to preserve your client's right to raise a waiver defense if the plaintiff accepts rent that accrues after he learns your client has committed another lease violation. Finally, make sure the order authorizes your client to raise any germane affirmative defense if the case is reinstated. To see a sample order, click here.
If your client is facing eviction because her household member or guest committed a material lease violation, and you cannot resolve the matter any other way, you may want to advise her to settle the matter by offering to bar the offending party from her apartment. If the plaintiff accepts this offer, draft an agreed order that dismisses the underlying action with leave to reinstate if your client permits the offending party to enter the premises. (Using the word "permit" is important because it confirms that your client cannot be evicted unless she knowingly allows the barred person back into her apartment.) To see a sample of such an order, click here.
The Section 8 Housing Choice Voucher Program is a tenant-based rental assistance program. Participants are issued a voucher and given an opportunity to enter the private housing market in search of an apartment. Once the tenant has located a unit, a local housing agency charged with administering the Section 8 Program ensures it meets housing quality standards (HQS), and determines whether the total rent is reasonable. If the unit passes inspection, the tenant enters into a lease agreement with the owner, and the owner enters into a contract with the housing agency. The tenant then pays a reduced rent equal to no less than 30% and no more than 40% of her adjusted gross income, and the housing agency pays the owner a monthly subsidy equal to the difference between the tenant's contribution and the total rent.
The initial term of the lease agreement between the tenant and the owner must last at least one year, but may be terminated without good cause (and upon 30-days' written notice) at the end of the initial term or any successive term. When the lease is terminated, the housing agency issues moving papers to the tenant, who then re-enters the private housing market in search of another apartment.
Compared to tenants who live in public housing or Section 8 project-based developments, a voucher-holder does not have nearly as strong an interest in preserving her tenancy because her lease agreement may be terminated without good cause, and she can move without losing her rental assistance. She may, therefore, want to offer the landlord exactly what he is seeking -- possession of the premises -- in exchange for some benefit, such as enough time to locate another suitable apartment. (Moving papers remain in effect for six months, and it often takes that long to locate and move into a unit that meets HQS and has a reasonable rent.)
There is another reason why a voucher-holder may want to move voluntarily. The federal regulations governing the Section 8 Voucher Program provide that the housing agency "must terminate program assistance for a family evicted from housing assisted under the program for serious violation of the lease." See 24 C.F.R. 982.552(b)(2) (emphasis added). Accordingly, if your client is facing eviction for a "serious violation of the lease" -- a vague term that may include seemingly insignificant breaches -- and the plaintiff prevails on a dispositive motion or at trial, your client will lose not only her apartment but her rental assistance.
Assume your client is willing to settle the case by vacating the premises voluntarily. Because of the federal regulation discussed above, you must exercise care when drafting the order that sets forth the terms of your agreement. If the order awards the plaintiff possession of the premises, include a specific finding that your client has not committed a "serious violation of the lease" as that term is defined in the applicable federal regulation. (To see a sample of such an order, click here.) Or, instead of awarding the landlord possession of the premises, continue the case to some date following the day on which your client agrees to move. Then draft an order which states that, if your client has moved by the next court date, the case will be dismissed with prejudice. (To see a sample of such an order, click here.) The second example is preferable because the entry of a judgment for possession will harm your client's credit.
Most forcible defendants live in private (i.e., unsubsidized) housing. Like Section 8 Voucher-Holders, they do not have that strong an interest in preserving their tenancies, and may therefore be willing to vacate the premises in exchange for an extended period of time within which to move, or money, or both. If you are able to negotiate such a settlement, the plaintiff will probably suggest entering a judgment for possession against your client and staying enforcement of the judgment for some agreed-upon period of time. Resist this suggestion. The entry of the judgment will harm your client's credit and potentially affect her future attempts to find rental housing. Offer instead to continue the case to some date following the day on which your client agrees to move. Then draft an order which states that, if your client has moved by the next court date, the case will be dismissed with prejudice. To see a sample of such an order, click here.
The following list functions as a review of some of the more important points discussed above:
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