On Monday April 6, 2020, Governor Ducey issued Executive Order 2020-21, granting a welcome reprieve to small businesses facing eviction during the COVID-19 pandemic. Governor Ducey’s order requires courts suspend commercial evictions for small businesses, unless the court determines that failing to evict would be contrary to the interests of justice. This includes suspension of lock outs, notices to vacate, and any other action attempting to inhibit the operations of a small business. Small businesses generally include those with 500 employees or less.
In addition to suspending evictions, Governor Ducey ordered commercial landlords to consider rent deferrals or adjusting rent payments for commercial tenants unable to pay rent due to the financial hardships caused by COVID-19. Landlords were also encouraged to work with tenants to waive late fees, penalties, interest on late rent payments, and to consider developing rent payment plans, but are not required to do so.
Commercial tenants seeking a delay in eviction should notify their landlord in writing of their financial difficulties and attach any supporting documentation, while also acknowledging their contractual obligations under the lease. Those receiving assistance from a public program designed to assist businesses impacted by COVID-19 must apply a portion of those funds to past or currently due rent payments.
It should be noted, the Executive Order does not forgive the required payments and only suspends eviction through the end of May.
Also remember that residential evictions have also generally been suspended until July 23, 2020.
If you are facing eviction or have a tenant that is not paying and have questions about your options, reach out to an attorney at Mesch Clark Rothschild in our Debtor-Creditor practice group.
