The Landlord-Tenant Relationship—It’s Personal

Andrew J. Street is a second-year commercial real estate associate at Friedlander Misler, PLLC in Washington, DC.

Every year, more than two million Americans must engage in the painful process of packing up all their belongings and searching for a new place to call home or to operate their business. Similarly, every year, landlords across America must engage in costly court proceedings to force tenants off their properties. There are many reasons why these evictions occur, ranging from a tenant’s failure to pay rent timely and fully to a vindictive landlord harping on minor lease violations. Beyond diagnosing the reasons for these evictions and identifying possible solutions, it is fundamental to understand that the nature of the landlord-tenant relationship is deeply personal.

While the landlord-tenant relationship is supposed to be a business relationship, in many ways it resembles a romantic relationship in that, due to its personal nature, it can easily become messy. It’s personal because of the parties’ substantial investment. A tenant invests both emotionally and financially because the property will either be a home or business. For a landlord, leasing a property is a major undertaking that opens the landlord to substantial liabilities. The parties’ individual investments place each in a very vulnerable position. Out of their vulnerability, they can take everything so personally if the relationship turns sour due to failed promises (e.g., not paying rent on time) or failure to meet expectations (e.g., not making repairs).

Additionally, the inherent power imbalance between the parties places a significant strain on the relationship. A landlord or tenant can easily have more bargaining chips than the other due to market conditions. If the property in the area is in high demand, then the landlord can exert certain concessions from the tenant. Alternatively, if the area is oversaturated with properties, the tenant may make certain demands of the landlord. Power imbalance can sometimes cause the parties to act illogically and out of a personal hurt, making the relationship messy.

For protection, and to mitigate the potential messiness of the landlord-tenant relationship, parties may employ the strategies below.

Read the Lease. It’s shocking the amount of people who fail to read their lease. While a term sheet or offer generally highlights the agreement’s key terms, with leases, the devil is in the details. Being unaware of the lease’s details will have parties believe they have rights or deserve a certain level of treatment, neither of which exist. When reviewing the lease: (i) highlight or underline every item stated in the offer or term sheet to ensure the lease reflects all the required items; and (ii) try to place each term into a category of either “helps me” or “hurts me.” After reviewing the lease, check the “hurts me” category for non-negotiables, and be prepared to suggest more favorable rephrasing for those terms. Being well-versed in the lease terms will keep both parties’ expectations in check and will motivate the parties to live up to their end of the bargain. This will save a lot of heartache and, importantly, will better allow for a tenant or landlord to advocate for changes in the lease.

Do Your Research. Before signing the lease, neither a tenant nor a landlord has a contractual obligation. However, there is an expectation for both parties that the relationship will move forward. Research the other party. Customarily, landlords will ask for credit ratings to ascertain whether a tenant can live up to the lease’s financial obligations. Both parties, however, should search for court proceedings involving the other party to understand if that party has difficulty upholding his or her end of a bargain, especially with respect to contractual obligations.

Know Your Rights. You do not need to be an expert in leasing to have a working knowledge of leasing rules and regulations. Many cities provide informational resources and layman explanations of local leasing laws. Some even require that landlords provide them to tenants at move-in (e.g., Seattle, Washington). Knowing the jurisdiction’s laws will force parties to be realistic about the extent of legal protections. Most importantly, parties will have the ability to demand the treatment they deserve. For example, New Yorkers can access local city rules via The Official Website of the City of New York or San Franciscans can got the City of San Francisco’s Rent Board website.

Be Solution-Oriented. When things turn badly, either party should always seek opportunities for a workable solution to an issue. If payment of rent is the issue, a smart tenant would seek out the landlord and proactively suggest a payment plan before the landlord has to get a court order for restitution. Alternatively, if a landlord can’t immediately repair the toilet, the landlord could suggest temporary partial rental abatement before the tenant sues for constructive eviction. Many people are more reasonable than you would expect once you start speaking to them. The key is to show up to work for a solution.

Admittedly, employing the foregoing will not save every landlord-tenant relationship. However, employing the following should give both parties a perspective that helps them respond based on the facts, rather than personal emotions. Understanding the lease terms, knowing the legal protections, and being willing to work proactively toward a solution can empower the landlord or tenant to behave not of personal antipathy, but to mitigate better the messiness inherent to the personal relationship. If all else fails, most jurisdictions have specialty courts to deal with landlord-tenant disputes. Those judges or arbitrators are specialized in the rights of both parties. Remember, the best outcomes come from person-to-person negotiations that often lead to win-win situations. It is personal after all.

Advertisement

Insurance Exclusive for ABA Members: Download your free Ebook today

 

  • TYL Topics

Get your copy of TYL In Focus

 

    

  • Subscribe to TYL

  • More Information

  • Contact Us

YLD Specialty Groups