INHERITING THE BAD LEASE

A property manager will often inherit leases from the prior management company. These leases are usually store bought leases, a lease out of a self help guide or something the manager printed out from an internet site. The manager files an eviction a month later only to realize that the lease required all notices to be sent by certified mail. Surprise! The manager now has to start over again. Can this have been avoided? Yes, but it takes some work and knowledge of what to look for. An odd notice service clause is just one of many things to look for when inheriting a lease agreement. Many leases are from other states or written by Florida attorneys who do not concentrate in landlord/tenant law. The first thing a manager should do upon inheriting a lease is to sit down and examine the lease line by line. While no one likes to read a lease agreement, this is a necessity, not an option. The clauses in a lease agreement often conflict with Florida law or can impose additional burdensome obligations.

Who are the residents? Confirm who the residents are in the property. While the lease may list one party, a completely different party may be living on the premises and paying rent. They may indeed be your residents. An eviction cannot be filed unless the names of the residents are known.

Notice serving: Under the Landlord/Tenant Act, the usual default notices, such as the Three Day Notice and Seven Day Notices, do not need to be served by certified mail or any form of mailing for that matter. The only notice which must be sent certified mail is the Notice of Intention to Impose Claim on Security Deposit as per Florida Statutes 83.49. Some leases have clauses requiring the mailing of notices by regular or certified mail. A typical manager is accustomed to serving a notice by posting on the premises or hand delivery as allowed by Florida law and does not think to mail a notice. An eviction is filed, only to have the case dismissed, and if there is an attorney representing the resident, a substantial attorney’s fee award may be given to the resident. How did this silly mailing requirement even get in the lease in the first place? Most likely because it seemed like a good idea to the lease drafter. Many attorneys feel that certified mail is the proper way to get an important notice to an individual, but the experienced manager knows that this is probably the worst way, as we have no control over when or even if the resident picks the notice up. Look at the inherited lease carefully before serving any notices.

How long to cure a default? A common clause in many leases deals with the amount of time the resident has to cure a default. Often there is a spot for the manager to fill in the number of days. While sometimes the section is left completely blank, other times bizarre numbers of days are inserted in the default section. We routinely see 7 to 30 days as being the amount of time given the resident to cure a default. What does this mean? The resident may have 7 to 30 days to pay rent, and the manager cannot give the resident a traditional Three Day Notice. The default clause is often buried in the inherited lease and can be missed.

Arbitration or Mediation Clauses: Florida law does not require arbitration or mediation in landlord/tenant law cases, but a clause inserted in a lease could trigger these procedures. While this might not be such a bad thing for a security deposit dispute, does this mean that potentially you will have to go to arbitration or mediation for an eviction case? These potentially dangerous clauses are sometimes found in the store bought, out of state or even Florida attorney prepared lease!

Security Deposit Timing Procedures: Many old leases state that the manager has 15 days to make a claim on a security deposit but we all know that the law now says we have 30 days. So, what is it, 15 days per the lease contract or 30 days per present law? We recommend that if the lease references the old statute and requires the claim letter to be sent in 15 days, make the claim in 15 days. A clause like this is easy to overlook.

Abandoned Property: Prior to the Florida law change, a manager was required to follow Florida Statutes 715 when dealing with a resident’s abandoned personal property. This statute requires that the resident be sent a notice and property held by the manager for a specific period of time before disposition. Disposition procedures under this statute depends upon the value of the property. This burdensome procedure can be avoided if the lease has certain specific wording regarding the non-liability of the manager as it pertains to abandoned property. Without this specific wording, the manager must follow the abandoned property procedures as outlined in Florida Statutes 715. A manager can easily run afoul of the law if the inherited lease does not have the abandoned property wording provided in Florida Statute 83.67.

General lease clauses: Is the rent on the lease the same as what the resident is paying? Are there other agreements out there? Is the lease old and expired? Are there blanks in important sections of the lease? Take your time and examine every clause thoroughly.

The Expired Lease: You inherited an expired lease. Can you force the resident to sign a new one? No, but you can give the resident a Notice of Non-Renewal as a way to either make them leave or sign a new lease. If they refuse to leave or sign, you simply evict them. How many days’ notice do you need to give to non-renew the resident? Who knows? You must look at the lease!!