Bill Text: NJ S4361 | 2026-2027 | Regular Session | Introduced
Bill Title: Amends rent receivership statute to provide that court shall appoint receiver under certain conditions; establishes mandatory appointment requirement.
Sponsorship: Partisan Bill (Democrat 1)
Status: (Introduced) 2026-05-28 - Introduced in the Senate, Referred to Senate Community and Urban Affairs Committee [S4361 Detail]
Download: New_Jersey-2026-S4361-Introduced.html
Sponsored by:
Senator ANGELA V. MCKNIGHT
District 31 (Hudson)
SYNOPSIS
Amends rent receivership statute to provide that court shall appoint receiver under certain conditions; establishes mandatory appointment requirement.
CURRENT VERSION OF TEXT
As introduced.
An Act concerning certain landlord-tenant actions and amending P.L.2003, c.295.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. Section 4 of P.L.2003, c.295 (C.2A:42-117) is amended to read as follows:
4. a. A summary action or otherwise to appoint a receiver to take charge and manage a building may be brought by a party in interest or qualified entity in the Superior Court in the county in which the building is situated. Any receiver so appointed shall be under the direction and control of the court and shall have full power over the property and may, upon appointment and subject to the provisions of P.L.2003, c.295 (C.2A:42-114 et al.), commence and maintain proceedings for the conservation, protection or disposal of the building, or any part thereof, as the court may deem proper.
b. A [building shall be eligible for receivership if it] court shall appoint a receiver for a building if the building meets one of the following criteria:
[a.] (1) The building is in violation of any State or municipal code to such an extent as to endanger the health and safety of the tenants as of the date of the filing of the complaint with the court, and the violation or violations have persisted, unabated, for at least 90 days preceding the date of the filing of the complaint with the court; or
[b.] (2) The building is the site of a clear and convincing pattern of recurrent code violations, which may be shown by proofs that the building has been cited for such violations at least four separate times within the 12 months preceding the date of the filing of the complaint with the court, or six separate times in the two years prior to the date of the filing of the complaint with the court and the owner has failed to take action as set forth in section 9 of P.L.2003, c.295 (C.2A:42-122).
c. A court, upon determining that the conditions set forth in [subsection a. or] paragraph (1) or (2) of subsection b. of this section exist, [based upon evidence provided by the plaintiff,] shall appoint a receiver, with such powers as are herein authorized or which, in the court's determination, are necessary to remove or remedy the condition or conditions that are a serious threat to the life, health or safety of the building's tenants or occupants.
(cf: P.L.2003, c.295, s.4)
2. Section 9 of P.L.2003, c.295 (C.2A:42-122) is amended to read as follows:
9. a. If the owner opposes the relief sought in the complaint brought under subsection b. of section 4 of P.L.2003, c.295 (C.2A:42-117) and demonstrates by a preponderance of the evidence that repairs were made in timely fashion to each of the violations cited, that the repairs were made to an appropriate standard of workmanship and materials, and that the overall level of maintenance and provision of services to the building is of adequate standard, notwithstanding any provision of P.L.2003, c.295 (C.2A:42-114 et al.) to the contrary, the court may dismiss the complaint.
b. If the complaint is brought by a tenant of the building which is the subject of the complaint and that tenant is in default of any material obligation under New Jersey landlord-tenant law, the court may dismiss the complaint.
c. If the court finds that the preponderance of the violations that are the basis of a complaint brought under subsection b. of section 4 of P.L.2003, c.295 (C.2A:42-117) are of a minor nature and do not impair the health, safety or general welfare of the tenants or neighbors of the property, the court may dismiss the complaint.
d. Within 10 days of filing the complaint, the plaintiff shall file a notice of lis pendens with the county recording officer of the county within which the building is located.
(cf: P.L.2003, c.295, s.9)
3. Section 10 of P.L.2003, c.295 (C.2A:42-123) is amended to read as follows:
10. a. If the court determines, after its summary hearing pursuant to section 4 of P.L.2003, c.295 (C.2A:42-117), that the grounds for relief set forth pursuant to section 5 of P.L.2003, c.295 (C.2A:42-118) have been established, the court [may] shall appoint a receiver and grant such other relief as may be determined to be necessary and appropriate. The court shall select as the receiver the mortgageholder, lienholder or a qualified entity, as defined pursuant to section 3 of P.L.2003, c.295 (C.2A:42-116). If the court cannot identify a receiver, the court [may] shall appoint any party who, in the judgment of the court, may not have registered with the department pursuant to section 31 of P.L.2003, c.295 (C.2A:42-142), but otherwise fulfills the qualifications of a qualified entity.
b. [If] Notwithstanding any provision of P.L.2003, c.295 (C.2A:42-114 et al.) to the contrary, if the court determines, after its summary hearing, that the grounds for relief set forth pursuant to section 5 of P.L.2003, c.295 (C.2A:42-118) have been established, but the owner presents a plan in writing to the court demonstrating that the conditions leading to the filing of the complaint will be abated within a reasonable period, which plan is found by the court to be reasonable, then the court may enter an order providing that in the event the conditions are not abated by a specific date, including the completion of specific remedial activities by specific dates, or if the conditions recur within a specific period established by the court, then an order granting the relief as requested in the complaint shall be granted.
The court may require the owner to post a bond in such amount that the court, in consultation with the party bringing the complaint and the public officer, determines to be reasonable, which shall be forfeit if the owner fails to meet the conditions of the order.
c. Any sums advanced or incurred by a mortgage holder or lienholder acting as receiver pursuant to this section for the purpose of making improvements to the property, including court costs and reasonable attorneys fees, may be added to the unpaid balance due said mortgage holder or lienholder subject to interest at the same rate set forth in the note or security agreement.
d. Nothing in this section shall be deemed to relieve the owner of the building of any obligation the owner or any other person may have for the payment of taxes or other municipal liens and charges, or mortgages or liens to any party, whether those taxes, charges or liens are incurred before or after the appointment of the receiver.
e. The appointment of a receiver shall not suspend any obligation the owner may have as of the date of the appointment of the receiver for payment of any operating or maintenance expense associated with the building, whether or not billed at the time of appointment. Any such expenses incurred after the appointment of the receiver shall be the responsibility of the receiver.
(cf: P.L.2003, c.295, s.10)
4. This act shall take effect immediately.
STATEMENT
This bill amends the rent receivership statute to require the court to appoint a receiver under certain conditions.
Under current law, a tenant or a housing inspector may file a complaint seeking repairs of property. The statute provides that, based on evidence provided by the plaintiff, a building "shall be eligible for" rent receivership upon a determination by the court that the building is in violation of housing codes so as to endanger health or safety or is the site of a clear and convincing pattern of recurrent code violations. However, other statutory language states that the court "shall" order a rent receivership in the same circumstances. Under a receivership, the tenants deposit their rent monies with a court-appointed administrator. These monies are used to make the repairs under the supervision of the administrator.
This bill would amend current law to provide that the court "shall appoint a receiver" under these conditions, with limited exception. The bill also deletes the language concerning "evidence provided by the plaintiff." The intent of this deletion is to clarify that the court is not restricted to considering only the plaintiff's evidence when determining whether to appoint a receiver.
Under the bill, the court would be required to appoint a receiver upon a determination that a building is in violation of housing codes so as to endanger health or safety or the building is the site of a clear and convincing pattern of recurrent code violations. If the court cannot identify a receiver, the court would be required to appoint an alternative qualified party.
The bill relates to a recommendation by the New Jersey Law Revision Commission, "Final Report Concerning the Interpretation of N.J.S.2A:42-117 of New Jersey's Receivership Act," issued October 20, 2022.
