NJ Bill Takes Aim At Landlords Who ‘Hide Behind Corporate Veils’

NEW JERSEY — A proposed state law in New Jersey is taking aim at landlords who “hide behind corporate veils” to avoid renovating their buildings, its sponsors say.

On Monday, the Senate Community and Urban Affairs Committee cleared S-523 by a vote of 3-2. Read the full text here.

According to its sponsors, Sen. Teresa Ruiz (District 29) and Sen. Shirley Turner (District 15), if it becomes law, the bill would allow a court to hold a corporation, limited liability company (LLC) or other commercial entity liable for charges related to housing codes, building codes or health codes. It would also allow courts to hold them liable for charges related to the Hotel and Multiple Dwelling Law.

Ruiz and Turner added:

“When registering as a landlord, the bill would require those organized as any other legal or commercial entity to submit the name and address of a registered agent. In addition, a landlord organized as a LLC, or any other legal or commercial entity would be required to submit the name and address of the members of the LLC who possess at least a 10 percent interest in the business, and the officers and directors in the case of a corporation, when registering as a landlord … The entity could be held liable if they had been notified of charges and at least three charges remained unpaid for 13 months after they were due.”

“Sadly, there are bad actors around the state hiding behind LLCs to avoid taking responsibility for the conditions of the buildings they manage,” Ruiz said.

“At the detriment of residents and neighborhoods, they are able to skirt enforcement agencies and refuse to make much-needed renovations,” Ruiz said. “By closing this loophole, we can hold bad actors accountable and improve the living conditions of tenants around the state.”

Turner said that “safe, secure, and decent housing” shouldn’t be a luxury, yet many renters are living in deplorable conditions because landlords are neglecting their properties.

The senator accused some New Jersey landlords of “hiding behind a corporate veil” to avoid their responsibilities to maintain their properties.

“Making the landlord registration process more transparent will provide our municipalities with the tools they need to not only protect tenants, but also to eliminate existing blight and prevent further blight in our communities,” Turner said.

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