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House.jpgAs real estate taxes skyrocket, many taxpayers have begun to look for ways to reduce their tax payments. One common method of accomplishing this is filing a tax appeal. However, since tax appeal procedure affords relief to very few taxpayers, the decision of whether to file an appeal will require a cursory understanding of how the process works.

Real Estate Taxes are calculated by multiplying your municipality’s tax rate by your property’s assessment. Your tax rate cannot be appealed; however, your assessment can be. Your tax appeal must, therefore, be based upon proofs that the municipality has over-assessed your property. In most cases, the taxpayer’s opinion should be supported by an independent appraisal. For appeals filed in 2011, the date of valuation should be October 1, 2010. In most cases, your appraiser’s report should be restricted to comparable sales that occurred in your municipality during the year 2010.

With property values decreasing over the past few years, over-assessment is most likely to occur in a municipality that conducted its last revaluation of its properties at or near the height of the real estate market. According to some experts, the New Jersey Real Estate Market reached its peak during September of 2006. Since then, property values have plummeted. Over-assessment of your property will result in higher real taxes. In these cases, a tax appeal is crucial.

In many municipalities, however, the assessments are still much lower than the actual property values. This is in part due to the fact that some municipalities infrequently conduct revaluations. Those under-assessed municipalities will therefore operate under the sometimes faulty assumption that all of their properties are under assessed by the same ratio and will increase their tax rates accordingly.

However, there are cases when a property is assessed at a much higher ratio than the other properties in town. When this occurs, the aggrieved taxpayer can also file an appeal, but the rules are slightly different. When a taxpayer argues that his property is assessed at a higher ratio than the rest of the municipality, the rules require that the property owner furnish evidence that his or her assessment exceeds the average ratio by at least 15%.

The tax appeal procedure begins with an application which is generally due on April 1st. Filing fees for the application range between $5 and $150 depending upon the assessed value of the property. While property owners may represent themselves in the tax appeal proceeding, the applicant must have an appraiser at the hearing in all cases where an appraisal will be offered as evidence.
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Apartment.jpgAll New Jersey Residential Evictions other than those brought for non-payment of rent require a landlord to first provide the tenant with notice(s) prior to filing the action with the Court. There are two types of notices under the Statute – the Notice to Cease and the Notice to Quit. In all cases, the Notice to Quit will be required. In the many cases, the Notice to Cease is also required. In this week’s article, we will detail these requirements along with the requisite timing for each.

Notice to Cease

The first Notice is the Notice to Cease. It is a warning notice, which alerts the tenant to the fact that he or she may be in violation and that such violation must immediately stop. Contrary to popular belief, the Anti-Eviction Act does not establish any minimum time requirement for the Notice to Cease. Instead, the law only requires that the time period given to the tenant must be reasonable in light of the violation alleged. For instance, in cases where the Notice to Cease requires an action on the part of the tenant, such as removing a pet or an extra occupant, the landlord should allow the tenant some time to cure the violation. Other causes for eviction, such as disorderly conduct, that can be cured relatively fast, do not require the landlord to give the tenant any time to cure.

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In this week’s article, we will discuss two scenarios in which New Jersey tenants who are experiencing habitability problems are permitted to withhold rent.

Method I – Repairing and Deducting The matter of Marini v. Ireland involved a tenant whose toilet broke. When the tenant complained to the landlord that the toilet was no longer working, the landlord refused to fix it. The tenant hired a plumber to fix the toilet, and he deducted the plumber’s bill from his rent. The landlord filed an eviction action based upon the unpaid portion of the rent. The Court ruled in favor of the tenant. Consequently, the matter of Marini v. Ireland set the standard for tenants who wish to withhold or deduct from their rent.

Method II – Withholding All Rent and Requesting a Hearing For many tenants, whose habitability problems are too expensive to resolve, the remedy of deducting and repairing is not a viable option. Therefore, the process of withholding all rents and requesting a Habitability Hearing has become much more common. While the process of withholding rent has its origins in the matter of Berzito v. Gambino, the Habitability Hearing that follows is generally referred to as a Marini Hearing.

As a practical matter, a Court will not address a tenant’s Habitability concern absent an eviction complaint by the landlord. Therefore, tenants who want to take advantage of this remedy must first begin withholding their rent. Soon thereafter, the Landlord will usually start an eviction action against the tenant. On the day of Court, the tenant will need to notify the Judge or the Court staff that he is requesting a Marini Hearing. In order to protect Landlords and to prevent tenants from filing false claims to avoid paying their rents, the Courts require tenants who are requesting a Marini Hearing to first post all unpaid rents with the Court. The tenant must also file with the Court a list of all Habitability Issues that will be addressed at trial. A copy of this list must also be served upon the landlord. The Marini Hearing is generally conducted a few weeks after the original Court date. In the event that additional rent becomes due prior to the Marini Hearing, the tenant must also post that amount with the Court. Consequently, since the Marini Hearing is preceded by the posting of all rents, a Judgment for possession cannot be entered against the tenant, regardless of the result of the Marini Hearing.

A tenant who is able to prove that habitability problems exist in the rented premises can expect to have a certain percentage of the posted funds returned back to him or her. However, absent extraordinary circumstances, the amount of rent returned to the tenant by the Court following a successful Marini Hearing is generally small (usually less that 25% of the total amount of rent posted). The Landlord will then be entitled to the balance of the rents that are posted. Courts very often make the return of this amount contingent upon the landlord first remedying the defects that have been found to exist within the rented premises. Please also note that for tenants who receive Section 8 housing assistance, the percentage of the abatement is based only upon the tenant’s portion of the rent, since only the tenant’s portion is posted with the Court.
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