As we head into the 11th month of the eviction moratorium in Illinois, tenants’ delinquencies are skyrocketing. With no end in sight to the current situation, landlords are searching for alternatives to recover unpaid rent.
In response to the financial hardship caused by the COVID-19 pandemic, property owners have provided tenants with a variety of options including deferred rent, payment plans, and penalty-free lease breaks. Unfortunately, some tenants are happy to ride the wave of rent-free living, ignore their landlord’s offers, and ultimately leave landlords feeling that they have no method of recouping the desperately needed funds.
However, in lieu of eviction, many landlords are now filing breach of contract cases for unpaid rent.
What is a breach of contract?
The goal of a breach of contract lawsuit is to obtain a money judgment against the tenant for:
- unpaid rent
- other charges due under the lease including utilities, parking fees, and repair costs
Although breach of contract will not result in an eviction order, the parties may work out a settlement during the case under which a reduced judgment is entered in exchange for possession. With a money judgment in place, the landlord can pursue future wage and bank garnishment to recoup the delinquency more quickly.
Less hoops, more options
When filing a breach of contract case, the landlord will not be required to serve the Illinois Housing Development Authority (IHDA) Tenant Declaration, wait 5 days, and then serve a 5 Day Notice.
In Chicago, there is no 7-day negotiation period before filing for breach of contract. You simply turn the delinquency over and the case gets filed.
Moreover, Chicago properties can add their attorneys’ fees to the amount of judgment and recover both their court costs and their attorneys’ fees (assuming your lease allows for recovery of fees).
In addition, we have found that tenants who are financially capable of paying rent (and simply choose not to) immediately come up with the money to pay their balance when they are faced with the possibility that a money judgment will appear on their credit.
Finally, you are not barred from filing an eviction against the same tenant for a future delinquency.
The eviction cannot cover the same months of non-payment that are covered by the breach of contract judgment. However, you have every right to file an eviction for the new delinquency if:
- if you proceed with breach of contract now
- obtain a money judgment
- and the tenant defaults again
As the coronavirus impact continues to affect Illinois rental properties and legislation narrows legal solutions, landlords should consider eviction alternatives.
A breach of contract lawsuit is a viable option to obtain a money judgment for unpaid rent, demand payment through the courts, and possibly even negotiate possession as part of a settlement.
Our law firm has handled breach of contract lawsuits efficiently for over 30 years so do not hesitate to contact us with any additional questions. KSN can be reached by calling 855-537-0500 or by visiting ksnlaw.com.
Since 1983, KSN has been a legal resource for landlords, property managers, and property owners. We have four office locations, serving hundreds of clients and thousands of communities throughout Illinois, Indiana, and Wisconsin. Our attorneys are also licensed in Arizona, Florida, and Missouri.
This article is made available by the lawyer or law firm publisher for educational purposes only as well as to give you general information and a general understanding of the law, not to provide specific legal advice. By reading this article you understand that there is no attorney client relationship between you and the article author. This article should not be used as a substitute for competent legal advice from a licensed professional attorney in your state. © 2021 Kovitz Shifrin Nesbit, A Professional Corporation.