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    Wednesday, July 17, 2019-12:26:10P.M.






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AG weighs in on Igisomar bill

ATTORNEY General Edward Manibusan has advised a Senate committee to consider the rights of tenants and landlords before passing a measure that would affect them.

Senate Bill 21-19, authored by Sen. Sixto Igisomar, proposes a six-month grace period before a rent agreement is terminated due to the destruction of property caused by typhoon.

Sixto Igisomar
Edward Manibusan

Chaired by Igisomar, the Senate Committee on Judiciary, Government, Law and Federal Relations Committee earlier sought the AG’s comment regarding the measure.

In his letter to Igisomar, Manibusan said “to avoid violating the Contracts Clauses of the Commonwealth Constitution, and the U.S. Constitution, S.B. 21-19 can only be applied prospectively, that is, to leases and apartment rental contracts that are not in existence at the time the bill takes effect.”

The AG said a retroactive application of the measure “would substantially impair leases that were in existence on the bill’s effective date.

In addition, the AG said the committee should consider how the bill would affect the rights of tenants and landlords under the “Restatement of the Law (Second) of Property,” a comprehensive collection of the law surrounding the landlord–tenant relationship that is often cited by the courts.

The AG said the CNMI Supreme Court itself has recognized that the “Restatement of the Law (Second) of Property” applies to the Commonwealth.

Igisomar’s bill, the AG added, “could…unintentionally alter [the] substantive rights of both landlords and tenants if it is not properly tailored.”

According to the bill, “the Legislature finds that in recent years, investors have shown keen interest in prime locations in the CNM, purchasing or leasing residential homes, commercial buildings, and apartment complexes. As a result of these business transactions, tenants were evicted at an untimely manner and forced to seek housing elsewhere while the new owner renovates or rebuilds the property resulting in a new monthly rent at a staggering rate.”

The bill added that the Legislature also “finds that the great devastation of Super Typhoon Soudelor greatly affected the demand and supply of residential housing units. The damaged housing resulted in evictions of tenants by landlord, especially those tenants without written rental contracts. The affected tenants were not even given a chance to request for temporary housing such as a tent provided by the Federal Emergency Management Agency…or the Red Cross.”

According to the bill, Super Typhoon Yutu “also wreaked havoc on the landlord-tenant relations. Many tenants were evicted involuntarily by landlords as a result of the rented homes being destroyed. In some cases, FEMA and the Small Business Administration assistance were impossible for many of our residents because landlords would not complete an affidavit for the tenant and in turn the landlord claimed the damages, leaving the tenant displaced. To make matters worse for the tenants, at a time when the CNMI was declared at a State of Major Disaster, the tenants were not allowed sufficient time to find suitable and affordable housing.”

The bill’s key provision states: “The landlord-tenant relationship shall not be terminated as a result of a destroyed dwelling due to a typhoon, sale or lease of the property by the owner, unless the landlord provides the tenant 6 months’ notice prior to terminating the landlord-tenant relationship. Provided however that the tenant may terminate the relationship anytime during the six-month period by giving a notice of not less than seven days to the landlord.”