Chapter 25 Landlord Tenant Law Ran Cai, Marta Tlalka, Carmen McGee, Sally Yang, Tommy Lee, April Noel Young, Ivy Pierce, Bryce Jones—Edited by Nic Schworer & Shelby Pieper Landlord tenant law regulates the relationship between the landlord ( lessor) and a tenant (lessee). Some states have adopted the provisions of Uniform Residential Landlord and Tenant Act (URLA) as their main guidance regarding the responsibilities and rights of both the landlord and the tenant, these states include Alaska, Arizona, Florida, Hawaii, Iowa, Kansas, Kentucky, Montana, Nebraska, New Mexico, Oregon, Rhode Island, South Carolina, Tennessee, Virginia. However, in other states the relationship is subject to state statutes and local ordinances, codes, and case law. The most important aspects of landlord tenant law include nonfreehold interests, types of tenancies, landlord warranties, repairs, subleases and security deposits. I. Non-freehold Interests (Leasing/Renting) A person can have two types of interests in a real property: freehold and non-freehold, latter known as leasehold. Freehold interest occurs when a buyer is purchasing property. The buyer is the owner and he has exclusive rights to the property. Freehold interest can be passed on as inheritance. Lease and rent agreements create a non-freehold interest in the property. The nonfreehold interest entitles the tenant to the possession of the property for a specific period of time that the landlord and the tenant agreed. The tenant buys, usually by paying rent, the right to use the property for a period of time. At the end of the lease agreement the property reverts back to the landlord. The non-freehold interest in a property is not inheritable. II. Types Of Tenancies Four types of tenancies result from a lease agreement. They are determined by the duration of the tenant’s rights in the property. These four types of tenancy are tenancy for years, tenancy from year to year, tenancy at will, and tenancy at sufferance. A. Tenancy For Years Under a tenancy for years lease, there is an arrangement between the landlord and the tenant stating that the property is leased or rented for a specific period of time. Tenancy for years must have a definite beginning and a definite ending. It actually can be less than a year (for example, 2 weeks). Chapter 25 Landlord Tenant Law Page 1 For example: the landlord leases a commercial warehouse to tenant from January 1, 2007 to January 1, 2010, a period of three years. During the three-year period, the tenant has the right to possess the warehouse and he gets all the benefits resulting from conducting business on the property. During the leasing period, the tenant is required to pay rent according to the terms of the rental agreement. The tenant also has the responsibility to keep the rental property clean and to properly dispose trash. The tenant should not deliberately or negligently allow damages to the property. If the tenant dies during the leasing term, the remainder of the term will pass to the tenant’s personal representative according to a will or to the laws of descent and distribution, because the tenant has the right to possess the property during this term. B. Tenancy From Period To Period Tenancy from period to period has an indefinite duration. A tenancy is valid until one of the parties gives notice of termination. Either party in the previous example is able to terminate the tenancy by providing a notice of at least one month (for a full pay period) in advance. For example, a tenant leases a unit in an apartment complex and agrees that rent of $1,000 per month, will be paid before the ninth day of each month. Then the tenant might possess the property for an undefined period as long as he pays rent each month before the ninth. This tenancy is also called tenancy from month to month. C. Tenancy At Will The arrangement of tenancy at will implies that the tenant occupies property with the permission of the landlord for an unspecified period of time, usually for free. This type of tenancy happens “at the will” of both parties. The notice of termination can be given by either the landlord or the tenant at any time. However, there may be some statutory requirements for the landlord to give notice before terminating the lease even though the lease is at will. This type Chapter 25 Landlord Tenant Law Page 2 of tenancy is common if the tenant does not pay rent in any specific intervals. Tenancy at will is not assignable to other parties. D. Tenancy At Sufferance A tenancy at sufferance occurs when a tenant continues to retain the occupation or possession of the land without the landlord's permission after the expiration of lease. It ends when the tenant is either evicted or is allowed to stay by the landlord. The tenant at sufferance is a trespasser who has wrongful possession of the property. In some states, the landlord may have the right to charge double rent during tenancy at sufferance. However, if the landlord agrees to it such as by accepting rent from the tenant, tenancy at sufferance can turn into tenancy for years or tenancy from period to period. Eviction must occur through a court order. III. Landlord Warranties Whenever the landlord leases property, the landlord gives certain warranties to the tenant; these warranties are automatic and created by law; they do not need to be included in a lease. The warranties are the duties and responsibilities of the landlord to the tenant at the inception and during the life of the lease. A. Warranty Of Possession The landlord provides a warranty to convey the possession of the premises to the tenant. The landlord guarantees that the tenant has the exclusive right to use the property during the term of the lease. Under this warranty, the tenant should be able to access the property at the first day of the lease and retain possession until the termination of the lease agreement. It is the landlord’s responsibility to make sure previous tenants have vacated the premises before the new tenant moves in. If the previous tenants have not vacated, the landlord has the right to remove them from the property through a court-ordered eviction. The landlord is also responsible for breach of warranty if the tenant does not have possession of the property for the entire term of the lease. B. Warranty Of Quiet Enjoyment The landlord guarantees not to interfere with the tenant’s rights to use and enjoy the property during the time of the lease. This means that the landlord cannot disturb the tenant by entering the property without the tenant’s permission, unless there is an emergency that threatens the property. The landlord usually must give notice to the tenant before entering the property in a non-urgent situation. If the landlord breaches the warranty of quiet enjoyment, the tenant can claim constructive eviction. Constructive eviction occurs when the tenant cannot live and enjoy the property due to the actions of the landlord. In this case, the tenant has been “constructively evicted” because he does not have full rights and possession of the property. Chapter 25 Landlord Tenant Law Page 3 When constructive eviction occurs the tenant can either send a written notice to the landlord allowing the landlord a reasonable amount of time to correct the situation or abandon the property within a reasonable period of time after the breach of warranty. If the tenant leaves the property the tenant is usually not liable for the rent due thereafter and could sue the landlord for damages. For example, if Marta rents property from Ran and Ran continuously enters the property without notifying Marta, Marta can claim constructive eviction. Because Ran violated the warranty of quiet enjoyment, she constructively evicted Marta. C. Warranty of Habitability Warranty of habitability forces the landlord to make sure that the leased premises are fit for ordinary residential purposes. The warranty applies to only residential property. The landlord has to warrant that the unit has adequate weatherproofing as well as heat, water and electricity. In general the property has to be clean, sanitary, and structurally safe. According to this warranty, the landlord must make the property habitable and make any necessary repairs to maintain the property standards. The landlord is also requires to comply with the local housing codes. IV. Common Areas Keeping common areas safe is the responsibility of the landlord rather than tenants. Common areas include hallways, entryways, lobbies, stairs, elevators, yards, porches, meeting rooms and any other rooms designated for the common use of tenants. The landlord is responsible to keep the common areas safe and in good condition at all times during the term of the lease. If the landlord fails to keep the common areas safe, he or she will face the potential financial liabilities. Even if the tenant’s injury is caused by the poor quality of the work done by repairman hired by the landlord, the landlord is still liable. The landlord can be sued for damages resulting from his or her personal negligence or those that he or she hires. A landlord’s general defense in a personal-injury case is that he or she acted in a prudent and reasonable manner. The landlord can avoid negligence charges if he or she can prove that he or she did everything a reasonable person would do in similar circumstances. Several things the landlord can do to avoid potential liabilities include frequent inspections of the property, informing the tenants of any possible problems and posting proper warning signs. Chapter 25 Landlord Tenant Law Page 4 V. Difference Between Assignment Of Lease And Sublease Both the tenant and the landlord can transfer their interest in the leased property. Transfer of the landlord’s interest usually happens when the landlord decides to sell the leased property. The tenant can also transfer his or her interest by either assigning the lease or subleasing, providing there are no clauses in the lease agreement that prevent the transfer. In most states, if lease is silent and there is no state law forbidding it, you can either assign or sublease. 1. Assignment In general, a lease is an assignable contract if the rights and obligations of a tenant or a landlord under the lease can be assigned to another person. A tenant, in this case an assignor, can transfer all rights of using the property to an assignee. The assignee then becomes liable to the tenant for the lease. The assignment does not relieve the assignor from his or her contractual obligation, unless specifically released by the landlord. If the assignee does not perform the contractual duties, both the assignor and assignee can be liable to the landlord. If the landlord releases the assignor, then only the assignee is liable unless novation. Assignment may not always be an available option for a tenant. There may be stipulations in a lease agreement that prevent the tenant from assigning the lease. The landlord can also assign the lease to another entity that would then obtain the same rights and responsibilities under the lease. For example, if landlord decides to sell his leased property, he would assign the remainder of the lease to the new owner. The new owner then would have the right to collect rent as well as all other rights and obligations associated with the lease. 2. Sublease A sublease occurs when the tenant wishes to temporarily transfer the rights of the property to another person. Subleasing transfers some, but not all, of the tenant’s rights under the lease. This could involve transferring some but not all of the remaining time of the lease or transferring less than all of the space or rooms. When subleasing, the tenant contracts with another person to allow some rights to the property. Under this new contract, the person subleasing is liable to the tenant but has no contractual relationship with the landlord. Only the tenant remains liable to the landlord for the lease and any problems caused by the person subleasing. Most ads for subleases are technically assignments of the lease. Chapter 25 Landlord Tenant Law Page 5 Under Missouri law1, before subleasing or assigning a lease, for most residential leases a tenant has to obtain permission from the landlord. The landlord approval has to be in writing. The landlord has the right to charge the tenant double rent if the tenant does not have a written approval from the landlord. In most states, prohibiting an assignment or a sublease does not prohibit the other. In Missouri, you cannot do either without the landlord’s permission because of a statute. VI. Repairs In general, the landlord is responsible for all major repairs.. The tenant is only responsible if the damages are caused by the tenant beyond normal wear and tear. There are several things that the tenant can do if the landlord refuses to conduct repairs to the property after being notified by tenant. Failure to make repairs may constitute a breach of implied warranty of habitability. Therefore the tenant can sue the landlord for damages. In extreme cases the tenant may terminate the lease. This occurs when the property becomes unsafe because of lack of repairs. The tenant can break the lease if the breach of the warranty of habitability is severe. In certain cases the tenant may also be able to conduct the repair and deduct the cost from the rent. Different guidance exists under the Uniform Residential Landlord and Tenant Act and state statutes regarding this matter. Under the Uniform Residential Landlord and Tenant Act, the tenant2 can repair minor defects and subtract the cost from the rent if the landlord fails to maintain premises and the reasonable cost is less than $100, or an amount equal to one-half the periodic rent, whichever is greater. The tenant must notify the landlord of his or her intention to correct the condition at the landlord’s expense and give the landlord reasonable time to do the repairs before the tenant corrects the condition. A tenant may not repair at the landlord's expense if the condition was caused by the deliberate or negligent act or omission of the tenant, a member of his family, or other persons occupying the premises with the tenant’s consent. Missouri Revised Statutes3 provide very limited situations in which tenant can subtract cost of repairs from rent. The cost can only be subtracted only if the landlord does not make the necessary repair after receiving the notice of violation of the city code and if all of the following conditions are met and the tenant: has lived on the premised for six consecutive months, is not in violation of any lease agreements, has paid all the rent, has notified the landlord and allowed fourteen days for the response, and has a confirmation that the problem violates city housing code. 1 Missouri Revised Statutes Section 441.030 Uniform Residential Landlord and Tenant Act Section 4.103 3 Missouri Revised Statutes Section 441.234 2 Chapter 25 Landlord Tenant Law Page 6 VII. Duty To Return Deposit A. Security deposit Apart from collecting rent, the landlord has the right to require the tenant to make an upfront security deposit. The rules related to security deposits may differ slightly between the Uniform Residential Landlord and Tenant Act and other state and local laws. For example, under the Uniform Residential Landlord and Tenant Act4 the deposit cannot exceed the amount of one month rent while according to Missouri Statutes,5 the landlord can require up to the equivalent of two months’ rent as a security deposit. B. Return Of Deposit The landlord has the duty to return the deposit when the lease is terminated unless the tenant did not pay all the rent or there is damage to the property that is beyond the normal wear and tear. The damages considered beyond normal wear and tear can include but is not limited to anything that goes beyond just a regular use of the property. The landlord can also withhold the deposit to compensate loses related to other contractual breach by the tenant. When returning the deposit to the tenant, the landlord has to provide a written statement regarding the amount of deposit and the amounts that were withheld. In Missouri, the deposit has to be returned within 30 days after the termination of the lease. If the landlord wrongfully withholds full or a portion of the deposit, the tenant can recover damages up to twice the amount wrongfully withheld if the judge thinks that is justified. For example, some minor marks on the wall and few nail holes would most likely be considered normal wear and tear. However, large holes in the wall could be considered significant damage to the property and the landlord may deduct the cost of repairs from the security deposit. 4 5 Universal Residential Landlord and Tenant Act – URLTA §2.101 Missouri Revised Statutes Section 535.300 Chapter 25 Landlord Tenant Law Page 7 For example, let’s assume the lease agreement states that tenant should give notice to landlord two month before moving out. If tenant give the notice less than two months in advance, the landlord is entitled to withhold portion of the security deposit. VIII. Kirksville Housing Code The City of Kirksville does not have a specific rental inspection program for landlords and tenants. Complaints from tenants or landlords are to be settled with inspections or contact with the responsible party. The Building Code may force the landlord to repair properties which are in dispute. In Kirksville, the housing code requires the properties in the city to maintain clean appearance. Excessive trash, high grass or weeds around the property constitute a violation of the code as well as unlicensed vehicles and storage of household items on the premises. Housing code also requires the landlord to install carbon monoxide detectors in units that are supplied with gas. The Codes Department in Kirksville also provides tips for identifying good rental housing. There are three top priorities and four lower priorities. The three top priorities include window/door security and emergency exits, emergency equipment available, and adequate electrical system. The four lower priorities include general condition, the landlord’s reputation, past utility bills for reference, and plumbing & fixtures. The Codes Department also provides The Smart Renter’s Checklist, which is attached below. The checklist should be a primary source of information when dealing with rental property. IX. 1997 Missouri Provisions County courts are authorized to order the quick removal of tenants involved in drugrelated criminal activity or violence, even when there is no arrest. Prior written notice is not required to remove a tenant. A landlord is guilty of forcible entry if they willfully interrupt utility service, unless it is done for health and safety reasons. Occupancy is limited to two persons per bedroom except for children born during the lease period. Chapter 25 Landlord Tenant Law Page 8 A. Eviction A landlord may not evict a tenant without a court order. The landlord may begin eviction proceedings if a tenant: damages property, fails to pay rent, violates the terms of the lease, injures the lessor or another tenant, allows drug-related criminal activity on the premises, fails to vacate at the end of the lease term, or gambles illegally on the property. The tenant will receive a notice that an eviction lawsuit has been filed and will have the opportunity to be heard in court before any eviction. B. Discrimination Landlords cannot refuse to sell, rent, sublease or otherwise make housing available based on a renter’s race, color, religion, sex, disability, familial status, or national origin. Landlords also cannot charge some individuals higher rent or falsely state that housing is not available for discriminatory reasons. X. Small Claims Court If a tenant cannot resolve financial claims with the landlord, it is possible to go to court without hiring a lawyer. In Missouri, one can sue for up to $3000 in small claims court. At trial, the judge largely acts as the lawyer for both sides and does much of the questioning. The judge makes a decision without a jury. The documents used to start the process are available from a court clerk at the county court house. The court can also help in the collection process. Decision can be appealed to a higher court (circuit court). The appeal (unlike most appeals) is a new trial. XI. Other Tips for Renters Check with former and current tenants to find out about the landlord. o Ex: How well they respond when things must be fixed. Or if they are flexible if you are a couple days late on rent, etc. Go through apartment with the landlord and look for problems so that you will not be blamed for them later. Sign the list with your landlord. o Ex: Any dents/holes in walls, stains, structural damage, etc. o Take pictures of any problems for proof you did not create them before signing lease. Landlords and tenants should become familiar with the booklet which is published by the Missouri Attorney General titled Missouri’s Landlord-Tenant Law; this 20 page booklet, found at http://ago.mo.gov/publications/landlordtenant.htm, contains information on the rights and Chapter 25 Landlord Tenant Law Page 9 responsibilities of landlords and tenants. The following is an excerpt from Missouri’s Landlord Tenant Law. Duties for Tenants: Pay rent on time Use reasonable care and not damage property Properly dispose of garbage Refrain from taking additional occupants or subleasing without the landlord’s written permission Duties for Landlords: Make property habitable before tenants move in Make and pay for repairs due to ordinary wear and tear Refrain from turning off a tenant’s water, electricity or gas Provide written notice to tenants when ownership of the property is transferred to a new landlord Not unlawfully discriminate Chapter 25 Landlord Tenant Law Page 10 Chapter 25 Landlord Tenant Law Page 11 References Kirksville Housing Code. Accessed < http://www.kirksvillecity.com/content/72/156/208/default.aspx> on March 20, 2009. Missouri Revised Statutes. Accessed < http://www.moga.mo.gov/statutesearch/ > on March 18, 2009. Strauss, Steven D. Landlord and Tenant. W.W Norton & Company, 1998. Universal Residential Landlord and Tenant Act. Accessed <http://www.law.upenn.edu/bll/archives/ulc/fnact99/1970s/urlta72.htm> on March 18, 2009. The Office of Missouri Attorney General. Missouri’s Landlord-Tenant Law. The rights and responsibilities of landlord and tenant. December 2008. Accessed <http://ago.mo.gov/publications/landlordtenant.pdf> on March 18, 2009. Uniform Residential Landlord & Tenant Act. Accessed <http://www.lectlaw.com/files/lat03.htm> on October 25, 2009 Chapter 25 Landlord Tenant Law Page 12