There will inevitably come a time in the landlord/tenant relationship where the manager wishes to end the tenancy at either the end of the lease term or at some later time, if the tenancy has become month-to- month. Successfully terminating the tenancy will depend upon the terms of the lease and the proper timing and service of the Notice of Non-renewal. Failure to non-renew properly can result in an unwanted extension of the tenancy. An improperly served or timed Notice of Non-renewal does not cure itself by the passage of time and thus becomes void to the resident’s favor. Just as the resident has a right to leave after the expiration of a lease, the manager also has a right to make a resident leave at the expiration of the lease. In this article, we will examine non-renewing a resident at lease end and non-renewing the month-to-month resident.
NON-RENEWING A RESIDENT AT LEASE END
DO YOU NEED A REASON TO NON-RENEW AT LEASE END? A manager can non-renew a resident for any reason or no reason at all, as long as the non-renewal is not based upon any illegal, discriminatory or retaliatory reason. A manager is not required to provide the resident with the reason for the non-renewal. It is imperative that if there is a reason for the non-renewal, that the manager has this well documented in the manager’s files. Often a resident who is non-renewed claims that the non-renewal was based upon race, handicap, familial status or almost any other reason related to their status as a protected class. In the event the resident files a discrimination lawsuit, a complaint with HUD or the local fair housing office, the manager will be required to provide proof that the non-renewal was not based upon an illegal discriminatory reason, but was rather based upon some valid business decision or due to the resident’s noncompliance with the lease or Florida law.
DO YOU NEED TO PROVIDE A RESIDENT WITH NOTICE OF NON-RENEWAL PRIOR TO LEASE END? If the lease is silent as to any notice requirements at the end of the lease term, the lease will automatically end at the lease ending date, the manager shall have the right to immediately file an eviction action, and the resident will be considered a holdover resident, thus owing double rent for each day the resident remains on the premises. No notice at all from the manager is legally or contractually required in this instance. Although it may not be required by the lease and is certainly not required by Florida law, we highly recommend that the manager give a Notice of Non-renewal to the resident at least 30 days prior to the end of the lease. This will help prevent any misunderstandings or the possibility that the resident may have forgotten that the lease is ending and may be expecting that it will continue if the manager does not advise otherwise.
HOW MUCH NOTICE SHOULD BE GIVEN PRIOR TO LEASE END? If the lease requires notice by the manager prior to lease end, as many leases do, this must be strictly followed per the lease terms, otherwise the lease will automatically convert into a month-to-month tenancy. In some cases the lease is silent as to notice requirements by the manager but does have a notice requirement on the resident. In this case we recommend that the manager follow the same notice requirement that is imposed on the resident. If you are asking the resident to give you 30 days’ written notice prior to the lease end, you should give the resident at least 30 days’ written notice.
NON-RENEWING THE MONTH TO MONTH TENANCY
WHAT IS A MONTH-TO-MONTH TENANCY? A month-to-month tenancy occurs when a resident is residing on the premises after the lease has expired, or if there was never a lease in the first place. Since we highly recommend against a manager failing using a lease agreement of some sort, and there are sales tax ramifications of moving a resident into a property without a lease, we will deal here with cases where the lease has expired and has become a month-to-month tenancy. The lease becomes a month-to-month tenancy when the manager allows the resident to continue to reside on the premises after the lease expires, collecting the rent from the resident and basically carrying on business as usual, with the only difference being that the lease has expired. All the same terms and conditions of the lease still will apply, and it is not required that the manager charge or collect sales tax when the lease becomes month-to-month.
CAN THE MANAGER CHARGE THE RESIDENT MORE RENT WHEN THE TENANCY BECOMES MONTH-TO-MONTH? The law is not clear whether the manager can arbitrarily raise the rent on the resident and force the resident to pay the higher amount on a month-to-month tenancy. The manager will probably be safe in giving the resident 30 days written notice that the rent will be increasing, but should make it clear that the month-to-month tenancy is terminating and the manager is offering a new month to month tenancy at a higher rent amount. Here, by the resident staying on the premises, there is an implicit agreement that rent will be at the higher amount. Many leases contain a clause which states that in the event the lease becomes a month-to-month tenancy and the resident remains on the premises with the consent of the manager, the rent will increase by a specified amount. This is highly recommended, as it will increase the rent and/or encourage the resident to sign a new lease or renew a lease with you.
DO YOU NEED A REASON TO NON-RENEW A MONTH-TO-MONTH TENANCY? A manager can non-renew a resident who is on a month-to-month tenancy for any reason or no reason at all, as long as the non-renewal is not based upon any illegal discriminatory reason. See the discussion above regarding non-renewing a resident at lease end. All the same reasons apply.
HOW MUCH NOTICE NEEDS TO BE GIVEN TO NON-RENEW A MONTH-TO-MONTH TENANCY? If the resident is remaining on the premises under a month-to-month tenancy, and the lease has expired, either party may terminate the tenancy by giving the other no less than 15 days’ notice prior to the beginning of the next monthly rental period IF AND ONLY IF the expired lease agreement does not require a different notice period. This is extremely important!! The lease agreement which the resident signed and is not expired often has a clause which states that either party must give a particular number of days notice to terminate the tenancy after it becomes month-to-month. If this is the case, the manager will be held to the notice requirement in the lease agreement, while the resident simply needs to give no less than 15 days notice to the manager. Here we have an apparent conflict with the lease terms and Florida law. Why should not the resident be bound to the lease terms? This is an example where the resident has a clear right under the law to terminate their month-to-month tenancy by giving no less than the 15 days notice. The lease cannot take this right away from them.
WHAT DOES “AT LEAST 15 DAYS NOTICE PRIOR TO THE BEGINNING OF THE NEXT MONTHLY RENTAL PERIOD” MEAN? The manager or the resident must give the notice at least 15 days before the beginning of a monthly rental period. If the rent period begins on the first day of the month and either party gives 15 days’ notice on the first day of the month stating they will be out on the 15th day of the month, the notice is NO GOOD. The resident will owe rent for the entire month, even if the resident vacates on the 15th. If the notice came from the manager, the notice will be invalid, and the resident can remain on the premises as until the manager give proper notice. If the rental payment period begins on the first day of the month, either party must give the notice no later than the 13th, 14th, 15th, or 16th of the month in order for the notice to be valid, and as mentioned previously, the manager may have to give even more notice if the lease requires the manager to do so.
SUPPOSE YOU ARE HOLDING A LAST MONTH’S RENT AND DECIDE TO NON-RENEW A MONTH-TO-MONTH TENANCY? If you are holding a last month’s rent, when you serve your Notice of Non-renewal, you need to state to the resident in writing that you are applying the last month’s rent to the last month of the tenancy. For example, if you are holding a last month’s rent, you cannot accept rent from the resident in June and then serve them a Notice of Non- renewal on June 1st stating that they must vacate on June 30th. Your acceptance of June’s rent implies that they can stay until the end of June, and your holding another month’s rent implies that you are not going to make them move at the end of June!
SERVICE OF NOTICE OF NON-RENEWAL. Serving a Notice of Non-renewal incorrectly will result in a nullity of a notice, and the tenancy will continue as if no notice was given. Shorting a notice by a few days will not mean that the manager simply has to wait those few additional days and the resident will then have to vacate. The manager will be at square one. Florida law does not state how a notice must be served, so the lease must be examined. If the lease requires that the manager gives the resident 30 days’ notice prior to the end of the lease term, that notice must be actually received by the resident no less than 30 days prior to the ending date. A common mistake is for the manager to mail the notice without giving the required 5 business days for mailing, or just sending the notice by certified mail believing that this is a sure way to prove that the resident got notice, only to realize that the resident failed to pick up or refused the certified mail. We recommend that a Notice of Non-renewal be served multiple ways, including mail, only if time permits and hand- delivery or posting on the premises in the resident’s absence. First and foremost, the notice must be served in accordance with the lease. Sometimes a resident will fail to put a notice in writing, and the manager will then seek to take advantage of this and try to prove that since proper notice was not given, the resident owes an additional month’s rent. Most judges feel that if the resident can prove that they put you on notice, then the requirement of written notice is not as important. If a resident gives you verbal notice that they are leaving, follow this up with a confirmatory letter stating, “This will confirm our conversation whereby you have indicated that you are vacating the premises on (insert date). The manager should also then serve a Notice of Non-renewal to the resident just to be safe.
SUPPOSE THE RESIDENT REQUESTS MORE TIME? We see more problems develop when the manager and resident come to some sort of agreement but fail to memorialize this agreement in writing. If the resident requests more time, the manager and resident should sign a document whereby the manager agrees to the new vacating date and the resident agrees to vacate at that time. If the resident is going to be paying for this privilege, all this should be spelled out. NEVER MAKE VERBAL AGREEMENTS ON EXTENSIONS.
WHAT HAPPENS WHEN THE RESIDENT FAILS TO MOVE? Would it not be nice if people did what they said they were going to do when they said they were going to do it? If the resident fails to move at the expiration of the Notice of Non-renewal, the manager has some choices. The manager can file an eviction immediately, wait to see if the resident will move or give the resident an extension. If the resident has not vacated, the manager should immediately contact the resident to see what the resident’s intentions are. It may be the case that the resident is almost out or just needs a couple days. The manager may want to wait it out. If the resident needs an extension, we recommend that the resident sign an Agreement To Vacate. Never assume that just because the resident is supposed to be out or says he or she will be out, that the manager now has a right to take possession of the premises. The only way the manager can take possession of the premises, even after a Notice of Non-renewal has expired is by surrender, abandonment or eviction. Always call your attorney if you have any doubt whatsoever that the resident may not be completely out.
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- THE CURABLE NONCOMPLIANCE EXAMINED PART 2
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