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Breaking Up Is Hard To Do!

-by Tia Politi, Property Manager at Acorn Property Management and rental owner

I like to tell tenants, “Who you choose to be roommates with is only slightly less important than who you choose to marry.” Platonic or romantic, relationships can fizzle, and what is normally a private matter between adults can become a landlord’s problem when relationships between tenants go south. In both cases, the roommate relationship creates not only personal entanglements, but legal ones as well. You can avoid choosing sides, but when their break-up drama impacts their tenancy, your involvement may be required.

In a month-to-month agreement, one or both tenants can simply give their 30-day notice and move out; however, if only one tenant is leaving, they may prevail upon you to give back whatever portion of the deposit they paid. The remaining tenant may insist that any damage in the home was caused by the other and is therefore not their responsibility. The good news for landlords in this situation is:  It’s not your problem! Inform your tenants politely yet firmly, that this is their problem to resolve. By law, with a month-to-month agreement, any deposit monies paid for the dwelling unit remain “with the property” until the last person on the agreement gives their notice and moves out – even if that person is not one of the original tenants. Likewise, any damages to the unit become the responsibility of the last person to give notice and vacate, no matter who actually caused the damage.

In a fixed-term lease, the situation is more complicated.  All tenants (and their co-signers) remain financially and legally responsible through the full lease term, whether they stay in the unit or voluntarily surrender their right of possession to their landlord or the remaining tenant(s). In other words, if one tenant wants to move out, you can’t force them to stay; however, you can continue to hold them liable in every way, unless you and the remaining tenant(s) agree, in writing, to release them from the contract. There can be good reasons for doing so and good reasons to decline.

I am dealing with a situation right now, where two men rented a two-bedroom campus apartment, but apparently did not know each other very well. One of the tenants started smoking pot in the unit and inviting his friends over for marathon video game sessions. The other tenant wanted to sleep and study and had done everything he could to get his roommate to get along, but in the end, he chose to move out rather than try to keep working on the situation. With multiple complaints from neighbors about pot smoking and loud music, we issued a Warning Notice followed by a 30/14 – a Notice of Termination with Cause. The behavior of the remaining tenant improved for a while, but here we are looking at evicting him for failure to pay rent and his continuing to smoke pot in the unit. If and when I go to court, I will only name the current occupant who still remains in the unit on the court action; however, because we declined the opportunity to release him from the lease, the departing tenant and his co-signer remain “jointly and severally liable” for any unpaid balance or damage to the unit, including eviction costs (if any) for his pathetic roommate. This may be a harsh lesson for the departed roommate which I call, “Paying Tuition in the School of Hard Knocks.”

In another situation, we have a group of three campus tenants, two of whom wish to renew their lease for another year and one of whom wishes to move out at the end of the lease term. Even though she wasn’t required to, the departing tenant agreed to sign a lease renewal with her remaining roomies for another year, but they have another applicant who we are currently screening who is planning to move in and take the departing tenant’s place. The departing tenant has also agreed to work out the return of her portion of the security deposit with the incoming tenant, so my job in this case is easy – add one tenant and remove another on the lease renewal. They will deal with the security deposit on their own, and we will release her from any claim for or responsibility to the new lease. The trick with this scenario is EVERYONE needs to agree in writing. And for the contract to be enforceable, it must comply with the rules of contract law: each party must be of legal age, or a legally emancipated minor; they must not be intoxicated; they must be mentally able to understand what they are agreeing to; and must not have signed the agreement under duress.

In the event that a departing tenant to a fixed-term lease is not okay with this scenario, you and the tenants will be faced with a few choices: 1) Refund the departing tenant’s portion of the deposit paid on move in, and allow the remaining tenants to find a new qualified roommate who will repay that portion of the deposit to you when all parties sign a new lease; 2) Collect a new deposit from the tenants who wish to remain as well as the ones who will be moving in. Then, when the current lease expires, do a walk through with both the departing and remaining tenants. Account for any visible damages and charge those to the current tenants’ deposit, refunding any remaining balance in the names of all the tenants within 31 days as the law requires. (Make sure that you receive a written acknowledgement from all parties to the new lease that there may have been items that were overlooked on the walk through but they are agreeing to be responsible for any hidden damage not discerned at that time, such as a carpet stain that was hidden by a couch.); 3) Have all of the tenants move out, do the work to turn the property, and reconcile their deposit issuing any refund in all their names. The remaining tenants can then move back in on a new lease. This is the cleanest option, but is a huge hassle for the remaining tenants.

We had a group of tenants in this situation where only one wanted out and insisted on the full return of her deposit, unless we were going to move everyone out and reconcile the whole thing. In the end, we and the remaining tenants elected to refund her portion of the deposit. The remaining tenants and the replacement tenant accepted that she wasn’t being charged for carpet cleaning, etc., but it did save us all a lot of hassle, so in that particular situation it worked for all concerned.

As with everything you agree to with tenants, put it in writing. Whatever you may think of attorneys specifically or generally, they didn’t pass the bar exam by being stupid, so remember two of their favorite sayings: “A verbal agreement is only worth the paper it is printed on.” And, “If it isn’t in writing, it never happened.”

This column offers general suggestions only and is no substitute for professional legal advice. Please consult an attorney for advice related to your specific situation.

Posted by: Acorn Property Management on June 14, 2016
Posted in: Uncategorized