Real Estate

Landlords and Fair Debt Collection

Landlords must comply with Fair Debt Collection

A recent Federal Court of Appeals decision in New York held that individuals or companies who serve eviction notices must meet the requirements of the Fair Debt Collection Practices Act (FDCPA). Congress enacted the law with the following purpose:

To eliminate abusive debt collection practices by debt collectors, to ensure that those debt collectors who refrain from using abusive debt collection practices are not competitively disadvantaged, and to promote consistent state action to protect consumers against debt collection abuses.

The court in New York found that the notification concerning a dishonored or non-sufficient funds check was similar to one sent to a resident delinquent in payment of rent. While the decision in this case is not binding or controlling precedent in Arizona, it is possible that a similar activity could be brought in Arizona, specifically in regards to five-day notices for nonpayment of rent.

Given this possibility, management should consider possible revisions to rent-collecting procedures. If a third-party is preparing and serving the five-day notice for nonpayment of rent, it is important he or she adheres to the requirements of the act.

To discuss your landlord/tenant concerns, contact our office to speak with an experienced Arizona business law attorney.