Colorado’s “No. 1 Eviction Firm” sued over alleged unlawful fees

The Colorado Poverty Law Project has sued a prominent eviction firm in the Rocky Mountain State, along with three corporate landlords, alleging they illegally charged fees and court costs during evictions.

The class-action lawsuit claims that eviction firm Tschetter Sulzer, and landlords Cornerstone Apartment Services, Redpeak Properties, and Echelon Property Group implemented a deceptive scheme to extract unlawful fees, despite the tenants’ efforts to rectify their nonpayment of rent, the Denverite reported.

At the heart of the lawsuit is a Colorado law that grants tenants a 10-day grace period to address back rent before eviction proceedings are initiated. If tenants can pay their arrears before the case reaches court, they can avoid eviction. 

In those cases, landlords are prohibited from charging attorney’s fees, a provision that’s meant to prevent tenants from facing additional financial burdens that exacerbate housing insecurity.

The lawsuit argues that Tschetter Sulzer’s forms include stipulations requiring tenants to pay the entire outstanding amount to retain their housing, resulting in numerous tenants entering into such agreements. 

Courtney Woodruff, one of the plaintiffs in the case, emphasized the importance of adhering to the law. 

“It’s unfair for landlords to require tenants to pay attorney fees and costs unless the law actually allows it,” Woodruff told the outlet. 

The lawsuit has been filed as a class-action due to the widespread influence of Tschetter Sulzer in the state, encompassing three tenants from Denver and two from Adams County.

The suit alleges that Tschetter Sulzer takes advantage of tenants’ lack of legal representation and understanding of the eviction process, employing these disadvantages to illegally extract attorney fees and costs. 

While landlords often have legal representation during eviction proceedings, tenants typically lack the same resources and knowledge. As a result, they find themselves at a disadvantage, unaware of their rights and the fees they are being charged.

Evictions in Colorado have surged beyond pre-pandemic levels in the past year, leading to substantial profits for Tschetter Sulzer, which specializes in filing eviction lawsuits. 

The lawsuit claims that the firm employs standardized forms that require tenants to pay attorney fees and costs, a violation of state law. Tschetter Sulzer charged $283 for initiating an eviction and an hourly rate thereafter, while landlords marked up the fee by $300 to $500 without disclosure to the tenants, according to the outlet, citing the lawsuit.

The Colorado Poverty Law Project claims Tschetter Sulzer’s alleged practice makes it difficult, if not impossible, for tenants to rectify eviction cases and increases the likelihood of households being evicted.

The lawsuit comes at a time when states are grappling with their housing crises nationwide, with calls to build more housing in Connecticut and YIMBYs recently scoring victories in Washington and Vermont.

 — Ted Glanzer