Even at that, good luck telling an eviction court "Yes, I was using illegal drugs, but it doesn't say I can't in my lease."

we are in line with the courts to evict our tenant.

It was assumed that the split structure was a function of being late in the market cycle, if that is the case do you think these deals will become less common and this practice will revert to kore traditional deals?

When that eviction restriction is lifted the courts are going to packed with eviction cases.  

The house needs to be safe, functional and pleasant for the tenants.

Bide my time and wait until the stay-at-home orders are lifted in your state and muni.You really have no leverage until the court is hearing evictions so you might as well get what you can.

Be nice about the whole thing because it will help you in court later on (if it goes there...hopefully not).

I would then take them to court for the balance.

Then refine your knowledge with questions.Look for a state that is affordable, has reasonable laws and courts that fairly support Landlords, and a growing job market.

However, if you are trying to keep the "corporate veil" from being "pierced", I would think a lawyer would tear you apart in court with the quit claim strategy.