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CHAPTER
25
LANDLORD AND
TENANT
I. OBJECTIVES
This chapter is designed to acquaint students with the legal doctrines and trends affecting
the
landlord-tenant relationship. After reading the chapter and attending class, a student should
be
able
to:
1. Recognize that the legal principles applicable to landlord-tenant relationships are drawn
from
property law, contract law, and the law of negligence and that they incorporate the
common·
law as well as legislative
enactments.
2. Describe and differentiate the four main types of
tenancies.
3. Understand the importance of a carefully drafted lease that makes clear the parties' rights
and
obligations and complies with any applicable provisions of state Law, including the statute
of
frauds.
4. List and discuss the primary rights, duties and liabilities of the
landlord.
5. List and discuss the primary rights, duties, and liabilities of the
tenant.
6. Describe the different ways that a lease may be terminated and identify the legal
principles
that apply to each method of
termination.
II. ANSWER TO
INTRODUCTORY PROBLEM
A. The first question following the hypothetical that appears at the beginning of the chapter
asks
whether an oral agreement can create an enforceable lease. As transfers of interests in
land,
leases are usually covered by the statute of frauds. In most states, a lease for a term of
more
than one year from the date it is made is unenforceable unless it is evidenced by a
suitable
writing signed by the party to be charged. A few
staies,however,
require leases to
be
evidenced by a writing only when they are for a term of more than three
years.
B. The second question asks whether the tenants' rights were violated when they were unable
to
take possession on the first day of the lease term. One of the
landlord's
obligations is
the
implied warranty of possession that guarantees the tenant's right to possess the property
for
the
term of the lease. This warranty would be violated if the tenant is unable to
take
possession
on the first day of the lease
term.
C. The third question asks what responsibility the landlord might have to a third-party who
was
injured on the premises. The answer to this question may vary from state to state.
However,
the trend is to impose on the landlord a duty to use reasonable care to carry out any duty
to
make
repairs-and
to hold the landlord liable for injuries sustained by a tenant or
third-party
if he/she had notice of a defect and a reasonable opportunity to make
repairs.
D. The fourth question asks whether the tenants have the right to claim constructive
eviction,
leave the premises and obtain their security deposit. Where the property is unsuitable
for
occupancy because of the
actions-or
failures of the
landlord-the
tenant would have
the
right to claim constructive eviction if he/she gives the landlord reasonable notice
and
opportunity to fix the problem and promptly vacates the premises if the problem is
not
remedied by the landlord. Where the tenant can properly claim constructive eviction,
the
landlord would be obligated to return the security
deposit.
Chapter 25 - Landlord and
Tenant
25-1
©
2016 by McGraw-Hill Education.
This is
proprietary material solely
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authorized instructor use.
Not
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for
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in
any
manner. This document may
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copied, scanned, duplicated, forwarded, distributed,
or
posted
on a
website,
in
whole
or
part.
E. The fifth question asks whether it would be ethical for the landlord to tell the students
he
would clean up the house knowing that he did not intend to do so. There is no
ethically
sound rationale for doing so on these
facts.
III SUGGESTIONS FOR LECTURE
PREPARATION:
A. h1troduction
1. Introduce the topic by noting the evolving changes in landlord-tenant law over the
last
three to four decades. These changes have been the legal response to the evolution from
a
primarily rural and agricultural society to a primarily urban and industrialized
society.
Point out that there are significant disparities in bargaining power, knowledge,
and
control between landlords and tenants. These factors, together with the huge numbers
of
tenants (who can be powerful allies for politicians), have led to increasing
legal
protection for
tenants.
2. Discuss the dual nature of the lease as both contract and conveyance of property.
Discuss
the various types of leasehold interests. You may want to bring in a copy of a form
lease
used in your locality and highlight the important
provisions.
B. Types
of Tenancies
1. Explain and give examples of the various types of tenancies. Discuss how each type
of
tenancy is
terminated.
a. Discuss the dangers of "holding over" after the termination of another
tenancy.
C. Landlord's Rights and
Duties
1. Note the right of the landlord to receive rent and to receive the return of the
leased
premises in as good a condition as it was at the beginning of the lease, ordinary wear
and
tear accepted. You might point out that most leases also provide that the tenant will
pay
any attorney's fees the landlord incurs in an effort to obtain past-due rent. Some
states,
however, hold such clauses unenforceable as violations of public
policy.
a. Discuss the role security deposits play with regard to unpaid rent and damage to
the
premises beyond ordinary wear and tear. Discuss modern statutes and ordinances
that
place limitations on security deposits and impose requirements on landlords
who
wish to retain all or part of a security deposit. If your jurisdiction has such a statute
or
ordinance, use it as an
example.
Example: Problem Case
#2
b. Note that when the tenant breaches the lease by abandoning the property and
ceasing
to pay rent, the landlord will often have a duty to mitigate damages by
making
reasonable attempts to re-rent the premises, rather than doing nothing and
letting
unpaid rent pile up month after month. However, not all states require landlords
to
mitigate
damages.
Example: Problem Case
#9.
2. Discuss the landlord's duty to comply with the Fair Housing Act. Explain the
statute's
prohibited bases of discrimination in connection with the rental of housing. Note
the
various ways in which the Fair Housing Act may be violated. Discuss the public
policy
concerns underlying the
statute.
a. Briefly note that state statutes and city ordinances sometimes prohibit landlords
from
discriminating on grounds that go beyond those set forth in the Fair Housing
Act.
3. Discuss the landlord's traditional duties: the implied warranty (or covenant) of
possession
and the implied warranty (covenant) of quiet enjoyment. Note that under traditional
law,
the landlord had no further duties once he had turned over control of the property to
the
tenant.
a. Point out that the warranty of quiet enjoyment means that the landlord does not
have
the right to enter leased property during the term of the lease unless there is an
emergency, a need for repairs to be conducted, or the parties have so
agreed.
Sometimes, the warranty of quiet enjoyment may be breached by the
landlord's
repeated failures to take reasonable action to eject, from the leased premises,
persons
who frequently come upon the premises and substantially interfere with the
tenant's
ability to enjoy the
property.
b. Define constructive eviction. Give some examples of breaches of duty that could
lead
to constructive eviction. Discuss the sort of proof the tenant must furnish to
establish
constructive eviction. Note that the tenant would have to have left the property
after
giving the landlord a reasonable chance to repair the breach. Discuss the
drawbacks
of constructive eviction, especially for the low-income residential tenant living in
an
area in which there is a shortage of affordable
housing.
Example: Problem Cases #3 and
4.
4. Discuss how and why the landlord's legal responsibility for the quality or condition
of
leased property has changed. Note how these changes have paralleled the caveat
venditor
trend in product liability
law.
a. Discuss the development and significance
of the
implied warranty of habitability as
it
applies to the rental of residential housing. Relate it to the development of the
same
warranty in the sale of housing and the implied warranty of merchantability in
the
sale of goods. Emphasize the continuing nature of the landlord's responsibility
under
this warranty: the property must be in habitable condition when rented and
the
landlord must maintain it in habitable condition during the term of the
lease.
1) Explain that trivial defects do not constitute a breach of warranty. Courts look
for
a defect that, under modern community standards, renders the property unsafe
or
unsuitable for
habitation.
2) Explain that a tenant must give a landlord notice of the defect and a
reasonable
opportunity to repair the defect before taking action under the implied
warranty.
3) Note that the warranty applies only to residential property.
It
does not apply
to
property leased for commercial
purposes.
4) Note that some states give this warranty a broader scope of applicability
then
other states
do.
5) Discuss the effect that housing codes have had in the development
and
application of this
warranty.
6) Discuss the remedies for breach of the warranty. Discuss which of these
remedies
are used in your state. Note that constructive eviction is
unnecessary.
Brooks v. Lewin Realty III, Inc. (page 704). Where a
tenant's
grandson was injured
as a result of his exposure to peeling, chipped and flaking lead paint and the
city's
housing code required that dwellings be kept in good repair, including free
of
peeling, chipped and flaking paint, the landlord could be held liable for the
tenant's
injuries whether or not it had actual knowledge of the housing code
violations.
Points for Discussion: Lay out the differences in the views of the majority on
the
court and those of the dissenter. What are the practical consequences for
landlords
and for tenants of the view of the law taken by the majority? Ask the students
which
view they agree
with-and
why they prefer that
view.
Examples: Problem cases #1 and
#4.
Ethics in Action: Disclosing Possible Hazards to Tenants (page 712). This
scenario
raises the question whether there is a duty to disclose a hidden danger to
individuals
who are affected by that danger. The presence of lead-based paint is not an
obvious
danger, and is one about which the landlord is likely to have greater knowledge
than
would the tenants. The presence of lead-based paint is a material fact. Knowledge
of
this danger may permit tenants to avoid serious harm. Thus, even though the
state
statute does not forbid the rental of such units, modern disclosure principles
would
probably require
disclosure.
b. Note that landlords who lease places of public accommodation may face
obligations
under Title III of the Americans with Disabilities Act, which was discussed
fairly
extensively in Chapter
24.
c. Discuss landlords' expanding tort liability. Note that landlords once were
immune
from liability for injuries occurring on the part of the property that was under
the
tenant's control, on the theory that the tenant had exclusive possession of
the
property. Discuss the exceptions to the no-liability rule that were developed
by
courts. Note that the trend today is against doing away with the complicated
system
of immunity and exceptions. Instead, the trend is toward placing responsibility on
landlords to use reasonable care in maintaining leased property. Courts have also
held
that landlords have the duty to use reasonable care to select other tenants
carefully
and to control
them.
Matthews v. Amberwood Associates Limited Partnership, Inc. (page 708) Where
the
landlord was aware of the presence of a vicious dog, a pit bull, in an apartment
where
the tenant had signed a lease agreeing, among other things, not to have any pets
on
the premises, a jury could find that the landlord had breached its duty of care to
a
visitor to the apartment whose son was killed by the animal because the
landlord
knew of the animal's presence and had the authority to do something about
it.
Points for Discussion: Note the strong dissent in this case with much
of the
dissenter's ire directed at the majority which, in the dissenter's view, had not
given
adequate attention to whether there was contributory negligence or a
superseding
cause that the jury should also have been allowed to consider. Ask the
students
which they think is the preferable view as to whether a landlord should have a
special
duty in cases like this to affirmatively protect a visitor to the
premises.
Example: Problem Case
#6.
1) Discuss
landlord's
attempts to eliminate tort liability to tenants by
including
exculpatory clauses in leases. Note the increasing tendency of courts
and
legislatures to disapprove of exculpatory clauses, at least when they appear in
leases of residential (as opposed to commercial)
property.
2) The proliferation of housing codes and other statutory regulation of landlords
is
likely to increase the use of the negligence per se theory as a basis of
liability
(see Chapter
7).
3) Point out that landlords today may be held liable when inadequate security
or
negligent maintenance of property facilitates criminal attacks on tenants
and
licensees by third parties. This can be a major concern for owners of property such
as
shopping malls or apartment buildings. (Chapter 24 contains further discussion
of
this
topic.
)
Tan v. Arne! Management Company (page 713). In this case the court found
that
the landlord had violated its duty to the tenant when the tenant was attacked
by
an assailant in the parking lot of an apartment complex. The court began
by
noting that to succeed in a negligence action, the plaintiff must show that: (1)
the
defendant owed the plaintiff a legal duty, (2) the defendant breached the
duty,
and (3) the breach proximately or legally caused (4) the plaintiff's damages
or
injuries. The scope of a landowner's duty to provide protection from
foreseeable
third-party criminal acts is determined in part by balancing the foreseeability
of
the harm against the burden of the duty imposed. The higher the burden to
be
imposed on the landowner, the higher the degree of foreseeability that is
required.
Example: Problem Case
#7.
D. Tenants' Rights and
Duties
1. Discuss the tenant's rights to exclusive possession and quiet enjoyment, noting that
these
rights are the flip sides of previously discussed duties of
landlords.
2. Discuss the obligation to pay rent. Point out that co-tenants have joint and
several
liability. Give an example of how this would work
if two
people leased an
apartment
together and one of them moved
out.
3. Discuss the tenant's duty not to commit waste or to do any act that would harm
the
landlord's reversion. Note the change in the law regarding whose obligation (landlord's
or
tenant's) it is to make
repairs.
4. Discuss the transfer
of leasehold
interests through assignments and subleases.
Distinguish
the two and show the practical effect of the distinction. Emphasize that a tenant
cannot
escape liability under the lease by assigning or subleasing. Note that leases may
prohibit
or limit assignment or
subleasing.
5. Note also that a tenant may be liable for harm suffered by a third party on
leased
property that is under his control
if
the injury was caused by the tenant's
negligence.
E. Termination of
Leaseholds
1. Discuss eviction. Note the typical procedures for eviction and the legal limits (such
as
forcible entry and detainer statutes) on the landlord's recovery of the leased
property.
Example: Problem Case
#8.
2. Note that tenancies may end by mutual agreement (agreement to
surrender
).
3. Discuss the consequences of a tenant's abandonment of leased property before
the
termination of the lease. Emphasize the trend toward placing the duty on the landlord
to
mitigate damages. This duty normally obligates the landlord to make reasonable efforts
to
re-rent the premises to someone else, instead of simply letting the breaching tenant's
past
due rent obligation continue to mount while the premises sit
unoccupied.
Sylva Shops Limited Partnership v. Hibbard (page 717). The court concluded that it
was
not against the public policy of the state of North Carolina to allow the parties to a
commercial lease contract away the landlord's duty to mitigate damages in the event of
a
default by a
tenant.
Points for Discussion: Ask the students to identify arguments in favor a rule that
landlord
s
must mitigate damages. Which arguments are stronger--those in favor of a mitigation
rule
or those in a favor of a no-duty-to-mitigate rule? Note that even if a landlord has no
legal
obligation to mitigate, the landlord might want to do so for practical reasons such
a
s
getting the rent payments flowing again sooner (if a replacement tenant can be found)
an
d
perhaps avoiding the need for potentially expensive
litigation.
Should commercial and residential landlords be treated differently in terms of
whether
there is a duty to mitigate damages? Why or why
not?
Example: Problem Case
#8.
IV. RECOMMENDED
REFERENCES:
A. David Hill, Landlord
and
Tenant
Law
in
a
Nutshell
(5
111
edition), West,
2010.
B. Janet Portman, Every
Tenant's
Legal
Guide (3d ed.
2002).
C. American Landlord Law: Everything U Need to Know About Landlord-Tenant
Law
(
McGraw-Hill
)
..
D. Susan Bright, Landlord-Tenant Law: Past, Present and Future
(2006).
