New Jersey Assembly Bill A892

New Jersey 2024-2025 Regular Session

• Introduced: 1/9/24
• Refer: 1/9/24

Caption

Expands liability of certain individuals associated with limited liability companies and other commercial entities, when acting as residential landlord.

Impact

The primary impact of A892 on state laws involves amending existing statutes related to landlord registration and making it easier for courts to enforce compliance among landlords associated with LLCs and corporations. The bill specifies that a minimum of three unpaid charges must exist for the liability to be invoked, alongside proper notice to the implicated parties. This creates potential liability for individuals involved in the management or ownership of properties that fail to meet code requirements, reinforcing the concept that responsibility lies with those who operate these businesses.

Summary

Assembly Bill A892 seeks to expand the liability of individuals associated with limited liability companies (LLCs) and other commercial entities operating as residential landlords. The bill proposes that members of member-managed LLCs, managers of manager-managed LLCs, and corporate directors and officers can be held jointly and severally liable for certain housing, building, and health code charges, provided specific conditions are met. This shift is aimed at enhancing accountability in residential property management, addressing concerns over ongoing violations by landlords while providing a mechanism for municipalities to collect owed charges more effectively.

Contention

Notable points of contention surrounding A892 revolve around the implications it might have on LLCs and corporations operating in the residential rental market. Supporters assert that the bill will encourage better compliance and maintenance of residential properties, benefitting tenants and communities. Conversely, critics may argue that the bill poses a risk of discouraging entrepreneurship in the property market due to increased personal liability for business owners. The enforcement provisions, including the allowance for unpaid charges to convert into liens against properties after specific time frames, may also lead to concerns around aggressive enforcement practices by municipalities.