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Maglies v. Estate of Guy

193 N.J. 108, 936 A.2d 414 (2007)

LEASES — Where a functional residential co-tenant can show that he or she has been continuously in residence and has been a substantial contributor toward the satisfaction of the tenancy’s financial obligations he or she is entitled to invoke the provisions of New Jersey’s Anti-Eviction Act if his or her contribution was acknowledged and acquiesced by the landlord.

A tenant who lived in an apartment and received Section 8 public assistance for housing obtained permission from her landlord for her daughter to move into the apartment. The daughter also received Section 8 assistance. The daughter’s Section 8 assistance payments were later incorporated into the lease with the landlord’s consent. Following the mother’s death, the landlord refused to accept Section 8 voucher payments from the daughter because she was not the named tenant on the lease. The landlord had concerns over the daughter’s ability to function as a head of household and about the presence of the daughter’s child in the apartment. The landlord gave the daughter the opportunity to apply for a new tenancy which required the running of a credit check. She refused to apply as a new tenant and subsequently the landlord attempted to lock her out of the apartment. The daughter obtained a restraining order against the landlord which kept her from being locked out pending an order of possession. The landlord then brought a summary dispossess action against the mother’s estate for non-payment of rent. The daughter intervened in the action, claiming that she had a right of possession in the premises and that the landlord could not refuse her rent payments.

The lower court held that the daughter could remain in the apartment and that the landlord could not refuse her payments. It found that the daughter had lived in the apartment for more than four years with the landlord’s consent and that as a surviving member of the deceased tenant’s family at the time of her mother’s passing, the daughter’s occupancy rights could not be terminated. On an appeal brought by the landlord, who argued the daughter was merely an “occupant,” the Appellate Division found that the federal law covering Section 8 allowed the landlord to choose his tenants and that he had the right to screen the daughter for credit worthiness and fitness as a tenant before entering into a lease with her. The lower court also found that the daughter might have had the right to succeed to her mother’s voucher subsidies, but that she did not have the right to succeed to her mother’s tenancy and did not enjoy the protections of anti-eviction statutes.

The matter eventually reached the Supreme Court. It held that after a lease between a landlord and a Section 8 tenant is executed, state law governs matters concerning the continued right of possession. The Court pointed out that it was not bound by the landlord’s definition of the daughter as merely an occupant and that according to long-held legal principles, the judiciary looks beyond labels and makes determinations based on the true nature of the transactions or relationships involved. The Court also pointed out that the purpose of New Jersey’s anti-eviction statutes is to prevent dislocating responsible, rent-paying tenants. The Court additionally pointed out that the landlord had benefited from the presence of the daughter because she was an additional financial contributor and helped strengthen the tenancy’s fiscal health. It held that if the daughter could prove that she substantially contributed to the tenancy’s financial obligations and was continuously in residence with the landlord’s consent, she was entitled to the protections of anti-eviction statutes as the functional equivalent of a co-tenant. On that basis the Court reversed the lower court’s decision and remanded the matter for a factual finding using the stated criteria. The Court pointed out that its decision applied specifically to the facts and circumstances involved in the matter and that the daughter’s continued occupancy remained subject to New Jersey’s anti-eviction statutes which allow evictions for non-payment of rent or other good cause. Dissenting opinions raised concerns that the majority decision created life-long possessory rights and also misapplied federal law. Concern that the lease, as a contract, was remade by the Court was also raised in the dissenting opinions.

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