Temporary relief for Oregon small business commercial tenants

Oregon commercial eviction moratorium

Oregon commercial eviction moratorium

On April 1, 2020, Oregon Governor Kate Brown issued an executive order that effectively suspends for 90 days both non-residential and residential evictions based on nonpayment of rent statewide. The new order extends the March 22 temporary moratorium on residential evictions for nonpayment and adds new eviction protections for commercial tenants such as small businesses leasing production or office space.

Under the new order,1, neither commercial nor residential landlords may terminate any tenant’s lease for nonpayment or take any action such as filing, serving, delivering, or acting on any eviction notice or order. A commercial tenant’s right to possession of leased premises is protected, although non-essential businesses remain closed during the ongoing COVID-19 health emergency.

“Nonpayment” as used in the moratorium order means nonpayment of rent, late charges, utility charges, or any other service charge or fee. This definition applies regardless of how termination for failure to pay is described either in a lease or by a statute. For example, Oregon tenancy laws define termination by failure to pay rent as failure to pay within ten days of rent being due. They require rent to be paid in advance, and they impose responsibility to pay rent on every person in possession of the leased premises. The order suspends these along with any varying requirements contained in a particular lease.

Notice and Documentation
Commercial as well as residential tenants must notify the landlord as soon as reasonably possible if unable to pay full rent and make partial rent payments if financially able to do so. Commercial tenants must also provide documentation or other evidence that loss of income preventing payment is due to the COVID-19 pandemic or governmental restrictions imposed to mitigate the spread of COVID-19. Residential tenants are not required to provide such evidence.

The notice requirement should be easily handled by a written letter to the landlord. Exactly what will constitute acceptable documentation of COVID-19 being the cause of nonpayment remains to be seen. Some landlords may consider proof of loss of income sufficient if a previously operating business confirms closure during the period of nonpayment due to compliance with Oregon’s “Stay Home, Save Lives” order.2 Others could request financial records such as written income statements (which, in any event, may be needed for other economic relief during the ongoing crisis). If you are unsure about what to do about evidence or what to include in a commercial or residential notice letter, please feel free to schedule a call.

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1  Exec. Order 20-13 (Apr. 1, 2020).

2  Exec. Order 20-12 (Mar. 23, 2020).

Dane Johnson