As Reported by the Senate Judiciary--Civil Justice Committee

128th General Assembly
Regular Session
2009-2010
Sub. S. B. No. 13


Senator Miller, D. 

Cosponsors: Senators Morano, Turner, Smith 

A BILL
To amend section 2329.26 and to enact sections 1
121.086, 2703.10, 5321.20, 5321.21, 5321.22, 2
5321.23, and 5321.24 of the Revised Code to 3
require a landlord to notify tenants when a 4
foreclosure action is filed, to require the 5
Director of Commerce to prepare a publication to 6
assist owners and tenants of foreclosed 7
residential rental property, to require the 8
officer taking lands and tenements to notify the 9
owner of the property of the date, time, and place 10
of the sale of the foreclosed property, to 11
require landlords to notify tenants when a 12
property is foreclosed and when a sale is 13
scheduled, to provide for continuance of a rental 14
agreement after a foreclosure sale, to impose a 15
civil penalty upon the landlord if the landlord 16
fails to notify the tenants when a property is 17
foreclosed, and to provide civil remedies for a 18
tenant whose landlord violates the bill's 19
provisions.20


BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

       Section 1. That section 2329.26 be amended and sections 21
121.086, 2703.10, 5321.20, 5321.21, 5321.22, 5321.23, and 5321.24 22
of the Revised Code be enacted to read as follows:23

       Sec. 121.086.  The director of commerce shall prepare a 24
publication for distribution to owners and tenants of residential 25
rental properties that are the subject of foreclosure actions. The 26
publication shall include a list of available resources to assist 27
owners of residential rental properties to retain their property 28
and to assist tenants in obtaining assistance if relocation is 29
necessary. The director shall make the publication available to 30
clerks of courts of common pleas in this state for distribution 31
to owners and tenants of residential rental properties that are 32
undergoing foreclosure.33

       Sec. 2329.26.  (A) Lands and tenements taken in execution 34
shall not be sold until all of the following occur:35

       (1)(a) Except as otherwise provided in division (A)(1)(b) of 36
this section, the judgment creditor who seeks the sale ofofficer 37
taking the lands and tenements or the judgment creditor's attorney38
does both of the following:39

       (i) CausesAt least thirty-five days prior to the date of the 40
sale, whether or not there is a default judgment, causes a written 41
notice of the date, time, and place of the sale to be served in 42
accordance with the procedure in divisions (A) and (B) of Civil43
Rule 5 upon the judgment debtor and upon each other party to the 44
action in which the judgment giving rise to the execution was 45
rendered and includes with the written notice a statement that if 46
the property is residential rental property the judgment debtor 47
who is the owner of the property must comply with divisions (A)(5) 48
and (6) of section 5321.20 of the Revised Code;49

       (ii) At least seven calendar days prior to the date of the 50
sale, files with the clerk of the court that rendered the judgment 51
giving rise to the execution a copy of the written notice and 52
included statement described in division (A)(1)(a)(i) of this 53
section with proof of service endorsed on the copy in the form 54
described in division (D) of Civil Rule 5.55

       (b) Service of the written notice and included statement56
described in division (A)(1)(a)(i) of this section is not required 57
to be made upon any party who is in default for failure to appear 58
in the action in which the judgment giving rise to the execution 59
was rendered.60

       (2) The officer taking the lands and tenements gives public 61
notice of the date, time, and place of the sale for at least 62
three weeks before the day of sale by advertisement in a63
newspaper published in and of general circulation in the county. 64
The court ordering the sale may designate in the order of sale 65
the newspaper in which this public notice shall be published, and 66
this public notice is subject to division (A) of section 2329.2767
of the Revised Code.68

       (3) The officer taking the lands and tenements shall collect 69
the purchaser's information required by section 2329.271 of the 70
Revised Code.71

       (B) A sale of lands and tenements taken in execution may be 72
set aside in accordance with division (B) of section 2329.27 of 73
the Revised Code.74

       Sec. 2703.10.  (A) When a holder of a mortgage files a 75
complaint to initiate a foreclosure action on a residential rental76
property, along with the summons that is served on the owner of 77
the property, the clerk of the court of common pleas shall do all 78
of the following:79

        (1) Include a statement that if the property that is the 80
subject of the foreclosure action is residential rental property, 81
the owner of the property must comply with section 5321.20 of the 82
Revised Code;83

        (2) Include a description of the penalties for failing to 84
comply with section 5321.20 of the Revised Code;85

        (3) Include a notice that if the property that is the subject 86
of the foreclosure action is residential rental property the owner 87
of the property must indicate that fact in the owner's answer to 88
the complaint;89

       (4) Include a statement that the owner of the residential 90
rental property must include the names and addresses of the 91
tenants of the residential rental property in the owner's answer 92
to the complaint.93

       (B) When the owner of residential rental property files an 94
answer with the clerk of the court of common pleas to a complaint 95
to initiate a foreclosure action on the owner's residential rental 96
property, the owner shall indicate in the answer that the 97
property that is the subject of the foreclosure action is 98
residential rental property and shall provide the names and 99
addresses of the tenants of the residential rental property.100

       Sec. 5321.20.  (A) A landlord who is the owner of a 101
residential rental property that is the subject of a foreclosure 102
action shall do all of the following:103

       (1) Within sixty days after receiving a summons that 104
contains a notice of foreclosure, provide written notice of that 105
foreclosure to any tenant of the property and include in the 106
written notice a statement that the tenant may contact the Ohio 107
foreclosure prevention web site at savethedream.ohio.gov or at the 108
toll-free telephone number 1-888-404-4674 to obtain a copy of the 109
publication on foreclosure prepared by the director of the 110
department of commerce pursuant to section 121.08 of the Revised 111
Code;112

       (2) After providing the written notice described in division 113
(A)(1) of this section to any tenant of the property and within 114
sixty days after receiving a summons that contains a notice of 115
foreclosure, file an affidavit with the clerk of the court of 116
common pleas certifying that the landlord provided the written 117
notice described in division (A)(1) of this section to every 118
tenant of the property;119

       (3) Include a notice of the foreclosure in any written rental 120
agreement the landlord enters into after receiving the summons 121
with a notice of the foreclosure action;122

       (4) Provide a written notice of foreclosure to a tenant at 123
the time of any oral rental agreement the landlord enters into 124
after the landlord has received a summons with a notice of 125
foreclosure;126

       (5) Provide each tenant at the property with written notice 127
of the date, time, and place of the scheduled sale of the 128
foreclosed property at least twenty-one days before the date of 129
the sale at auction;130

       (6) After providing each tenant at the property with written 131
notice of the date, time, and place of the scheduled sale of the 132
foreclosed property, file an affidavit with the clerk of the 133
court of common pleas certifying that the landlord provided each 134
tenant at the property with that written notice.135

       (7) Not more than seven days after the confirmation of the 136
sale of the property subject to the foreclosure action if the 137
"Protecting Tenants at Foreclosure Act of 2009," Pub. L. No. 138
111-22 (2009) has been repealed or has expired, provides the 139
names of the tenants at the property who were not current on 140
their rental payments under the rental agreement as of the date 141
of the confirmation of sale to the successor in interest.142

       (B) Any written notice the landlord provides pursuant to this 143
section shall include a statement in substantially the following 144
form:145

       "This property is undergoing foreclosure. The case number for 146
this foreclosure action is ............... (case number). For more 147
information on this action, you should contact the .......... 148
(your county) County Court of Common Pleas, .......... 149
(address), at .......... (phone number) or ................ (web 150
site).151

       A sale at auction could occur as a result of this 152
foreclosure. Currently, [the sale of this property has been set 153
for .......... (time, date, and place)] or [no date for sale of 154
this property has been established]. Ohio law requires that I 155
provide you with written notice of the sale at least twenty-one 156
days before it takes place.157

       If there is a sale of this property at auction, your current 158
rental agreement will be subject to the "Protecting Tenants at 159
Foreclosure Act of 2009," Pub. L. No. 111-22 (2009). If the 160
"Protecting Tenants at Foreclosure Act of 2009" has expired or 161
been repealed on or before the date of the confirmation of sale 162
and if you are current on your rental payments under the rental 163
agreement on the date of the confirmation of sale, your current 164
rental agreement will convert to a month-to-month rental agreement 165
upon the sale of the property unless you and the successor in 166
interest mutually agree to a different termination date for the 167
rental agreement.168

        Note: With a month-to-month rental agreement, either the 169
tenant or the landlord may terminate the agreement by providing 170
written notice of termination to the other at least thirty days 171
prior to a date on which the rent payment normally is due. The 172
rental agreement then terminates on that rent payment date."173

       (C) If the landlord does not file as required by division 174
(A)(2) of this section the affidavit with the clerk of the court 175
of common pleas certifying that the landlord provided written 176
notice of the foreclosure action to the tenants, the clerk shall, 177
within seven days after the expiration of the sixty-day 178
requirement that the landlord provide written notice of the 179
foreclosure action to the tenants, send the written notice 180
described in division (B) of section 5321.20 of the Revised Code 181
to the tenants of the property.182

       (D) If the landlord does not file as required by division 183
(A)(6) of this section the affidavit with the clerk of the court 184
of common pleas certifying that the landlord provided written 185
notice of the date, time, and place of the scheduled sale of the 186
foreclosed property to the tenants at least twenty-one days 187
before the date of the sale at auction, the clerk of the court 188
of common pleas shall, no later than fourteen days before the 189
date of the sale at auction, notify the landlord of the 190
landlord's requirement to provide each tenant at the property 191
with written notice of the date, time, and place of the 192
scheduled sale of the foreclosed property and to provide the 193
clerk with an affidavit certifying that the landlord provided 194
that written notice.195

       Sec. 5321.21.  Any rental agreement for a residential rental 196
property that is the subject of a foreclosure action is subject to 197
the "Protecting Tenants at Foreclosure Act of 2009," Pub. L. No. 198
111-22 (2009). Upon the repeal or expiration of the "Protecting 199
Tenants at Foreclosure Act of 2009," any rental agreement for a 200
residential rental property that is the subject of a foreclosure 201
action shall convert to a month-to-month rental agreement upon a 202
court's approval of a sale at auction pursuant to section 2329.31 203
of the Revised Code if the tenant under the rental agreement is 204
current on the tenant's rental payments under the rental 205
agreement on the date of the confirmation of sale unless the 206
successor in interest and the tenant mutually agree to a 207
different termination date for the rental agreement. The initial 208
successor in interest in the property shall be subject to the 209
month-to-month rental agreement and shall be the landlord under 210
the month-to-month rental agreement or the alternative rental 211
agreement mutually agreed to by the successor in interest and the 212
tenant as provided in this section. The successor in interest has 213
the right to enter the property subject to division (A)(8) of 214
section 5321.04 of the Revised Code.215

       Sec. 5321.22. Within seven days after the confirmation of the 216
sale of the property subject to the foreclosure action pursuant to 217
section 2329.21 of the Revised Code, the owner of the property 218
subject to the foreclosure action shall forward to the successor 219
in interest all security deposits held by the owner of the 220
property on behalf of the tenants of the property. The successor 221
in interest shall return any deposit to a tenant when the rental 222
agreement ends in the same manner that this chapter provides for 223
tenancies that end pursuant to the terms of the rental agreement, 224
except that the successor in interest shall be obligated to return 225
a security deposit only to the extent that the security deposit 226
was forwarded to the successor in interest from the owner of the 227
property as provided for in this section.228

       Sec. 5321.23. (A) A tenant may recover reasonable attorney's 229
fees as well as the greater of actual damages or one month's rent 230
and obtain injunctive relief to enforce the rental agreement, or 231
both, if a landlord or a successor in interest violates section 232
5321.20, 5321.21, or 5321.22 of the Revised Code, fails to 233
provide a written notice that section 5321.20 of the Revised 234
Code requires, or fails to honor a rental agreement established 235
under section 5321.21 of the Revised Code.236

       (B) If the landlord fails to provide the tenants with the 237
written notice required under section 5321.20 of the Revised Code 238
and fails to file an affidavit with the clerk of the court of 239
common pleas certifying that the landlord provided the tenants 240
with that written notice, the court may impose upon the landlord 241
a civil penalty that equals the cost that the clerk incurs for 242
sending out the written notice in accordance with division (C) of 243
section 5321.20 of the Revised Code plus one hundred dollars per 244
rental unit, not to exceed one thousand dollars. The clerk shall 245
pay each collected civil penalty to the county treasurer for 246
deposit in the county treasury.247

       Sec. 5321.24. The rights and remedies provided for in 248
sections 5321.20, 5321.21, 5321.22, and 5321.23 of the Revised 249
Code are in addition to and do not preempt any other rights that 250
a tenant may be entitled to under any other provision of the 251
Revised Code. Upon the repeal or expiration of the "Protecting 252
Tenants at Foreclosure Act of 2009," Pub. L. No. 111-22 (2009), 253
nothing in this section shall prevent a successor in interest 254
from providing a thirty-day notice to terminate a month-to-month 255
rental agreement created under section 5321.21 of the Revised 256
Code on the first day that a rental payment is due following the 257
confirmation of sale.258

       Section 2. That existing section 2329.26 of the Revised Code 259
is hereby repealed.260