After a landlord has had her rental property returned through an eviction action or the tenant vacating of their own accord, a landlord has the option of pursuing the ex-tenant for money damages. I have explained in previous posts, that a typical eviction lawsuit includes three causes of actions against the tenant. First, return of the rental property (“eviction”). Second, a claim for past due rent and other fees allowed under the rental agreement. Third, physical damages to the rental property and holdover damages.
When it comes to the third claim, I often see landlords pursue physical damages to the unit (and cleaning charges) and fail to even consider pursuing holdover damages. This is often because the landlord is not aware that holdover damages exist and/or she is unfamiliar with them. Hopefully this blog post will rectify that situation.
Holdover damages are allowed per sec. 704.27,Wis. Stats., which states that if a tenant remains in possession of the rental unit without the consent of the landlord after expiration of the lease or termination of the tenancy, the landlord may recover damages from the tenant for the tenant’s failure to vacate the unit within the time required.
Sec. 704.27 further states that, in absence of proof of greater damages, the landlord may recover a minimum damages amount for the tenant’s holdover of twice the rental value apportioned on a daily basis.
A tenant becomes a “holdover” tenant once their tenancy has been terminated and they remain living in the rental premises without the landlord’s consent. A tenancy is terminated under any number of scenarios. For example:
1. A tenancy terminates when when a 5 day notice for failure to pay rent has been properly served on the tenant and 5 days have passed and the tenant has failed to cure the breach or vacate the rental unit.
2. A tenancy also is terminated when a 14 day notice to vacate due to breach has been properly served on the tenant and the tenant fails to vacate at the end of the 14 days.
3. A tenenacy terminates when a tenant is under a month to month tenancy and has been properly served with a 28 day notice and the tenant fails to vacate.
4. A tenency terminates if a lease expires, no renewal has occurred, and the tenant remains living in the rental unit.
Under all of the above situations, the tenant has now become a “holdover tenant” which entitles a landlord to “holdover damages.”
Holdover damages are much more easy to prove up in court than physical damages. All a landlord needs to do to prove holdover damages is to establish the date that the tenancy terminated and the date that the tenant actually vacated the rental unit. The rest is just simple math — calculating the daily rent for the period of the holdover.
When pursuing physical damages to a rental unit, a landlord must prove the following:
1. That the unit was not previously damaged prior to the tenant moving in — this is often done via photographs, video, testimony, or a check-in check-out sheet, or a combination of any of the above).
2. That the damages were caused by the tenant or the tenant’s guests or invitees.
3. That the damages are actually “damages” and not merely normal “wear and tear.”
Maybe you have experienced this yourself, but I have noticed that tenants are readily willing to admit that they did not pay rent, but they will fight you tooth and nail if you argue that they damaged your rental property or failed to clean it prior to vacating. Once a tenant learns that you intend to pursue them for damages and cleaning costs, out come the multitude of excuses, such as . . . I didnt’ break that door, my brother did that when he was drunk, you should sue him . . . that urine soaked carpeting was like that when I moved in 5 years ago, must’ve been the prior tenant’s cat that used the carpeting as a litter box (even though the carpet is still physically wet 5 years later) . . . etc. etc.
Since tenants often take issue when a landlord pursues them for physical damages, the landlord is often forced to go through with an evidentiary hearing in order to obtain her judgment. Add to that, the fact that a tenant has the right, at no additional cost, to request a de novo review of the hearing if they do not like the result, and a landlord can expend a lot of time and money pursuing her damage judgment.
Since most tenants are often “uncollectible” it often does not make practical sense for a landlord to go forward. She will only lose time and money . . . both of which will never be recovered. Whetehr or not to pursue money damages against a tenant at all is a decision that only the landlord can make based on their specific situation.
When a landlord pursues holdover damages against a tenant there seems to be fewer requests on the tenant’s part for a damage hearing. Oftentimes, the court commissioner will explain to the tenant what holdover damages are and that they are “statutory” in nature and thus only require that one factual issue be determined – when the tenant vacated the rental unit.
This is not to say that a tenant won’t still request a hearing if a landlord pursues only holdover damages against them. They still might (although the frequency of the request is much less than when a landlord pursues physical damages, in my opinion). And they certinaly may request a hearing if the landlord pursues both holdover damages and physical damages against them. Nonetheless, even if an ex-tenant does request a hearing, the time spent prepping for the hearing to prove holdover damages, and the exhibits necessary to be introduced at such a hearing, are much less involved than for a damage seeking physical damages
So while tenants may not like holdover damages, the law provides for them and a landlord has every right to avail herself of them.
ADDED 8/2/11 at 5:53 pm — It should be noted that in Milwaukee County I have been told repeatedly that landlords cannot seek both physical damages to the rental unit and holdover damages against a tenant. In Milwaukee County, the courts have indicated that it is their interpretationof sec. 704.27 that a landlord may only recover holdover damages if the landlord cannot prove greater physical damages to the unit. I believe this interpretation of the statute to be incorrect. I believe — just as the commentor below has stated — that a landlord is entitled to holdover damages of twice the rental value apportioned on a daily value as a minimum for the tenatn’s holdover unless she can prove greater damages for the holdover. Physical damages should be treated separately. The language “in absence of greater damages” set forth in sec. 704.27 is not referring to physical damages at all. Nonetheless, a landlord should be prepared that they may be told to choose to elect either holdover damages or physical damages in Milwaukee County.
The Vincenti v. Stewart, 107 Wis. 2d 651, 321 N.W. 2d 340 (Ct. App. 1982) further addresses this issue. the Court of Appeals refers to the Committee Comments to sec. 704.27, at pages 654-655 of its decision, and explains that the recovery of twice the rental value only establishes a minimum damages amount for a tenent holding over. The Court explains that in some circumstances greater damages can be proven as a result of the tenant’s holdover. It is clear in from the Vincenti opinion that the “greater damages” language refers to greater damages due to the tenant’s holdover only and NOT greater damages in general (i.e. physical damages to the unit).
#1 by John H. (Dr Rent) Fischer on August 2nd, 2011
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Tristan my friend,
What is this no double dipping nonsense.
It was always my understanding that you get double rent unless you can prove greater damages caused by the holdover (for example, maybe that holdover caused you issues with the tenant who was going to move in). Physical damages to the property were completely different from holdover damages… and if the physical damages were caused by waste (that intentional fist hole in the door), those could also be doubled under 844.19.
I use the holdover damages to negotiate stipulated dismissals, which is a long story in and of itself.
#2 by Tristan R. Pettit, Esq. on August 2nd, 2011
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Hi John – In Milwaukee County the courts interpret the statute differently than you and I do.
They interpret the phrase “in absence of proof of greater damages” language to mean if you have physical damages greater than the holdover damage amount then you cannot get the holdover damages.
In fact there was one court commissioner who believed that the language of sec. 704.27 prevented a landlord from getting holdover damages at all if there was rent owed that was greater than the holdover damages — he felt that actual rent owed were damages that prevented a landlord from getting holdover damages.
I personally agree with your interpretation of the statute John — but the powers that be in Milwaukee County do not.
I should add a caveat to my blog on this point however – thanks for bringing it up.
#3 by Jeff on August 3rd, 2011
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These judges don’t realize there burning innocent people with that stand. The first line in the statute states it’s specific to damages caused by holdover, which is normally damages to the new tenant that were on the hook for. I don’t understand how they get around that. It’s a penalty. It has a sting by design to prevent damage to a totally innocent new occupants and get them out in a timely fashion.
#4 by John H. (Dr Rent) Fischer on August 4th, 2011
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Jeff,
I don’t think you are going to get much disagreement here.
What it comes down to is something that I tell all of my students in my Landlord-Tenant law classes. I explain that I am going to teach them the rules as they are written. However, they need to understand that what the rules are and what judges personally interpret the rules to be are often two very different things.
I encourage landlords to talk to other landlords who have gone through the process to see how their specific court will treat a specific issue.
Unless someone gets burned and takes it through the appellate process to get a published opinion, we must deal with this low level legislating from the bench. Often, the time and especially the cost to appeal on an issue such as this simply isn’t worth it.
#5 by Tristan R. Pettit, Esq. on August 4th, 2011
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Well said, John!!
I wish we could get a blunch of landlords together on some of these issues to spread out the cost and appeal them so we could have some appellate caselaw to cite to in the future.
T
#6 by Shawn on August 8th, 2011
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Am I correct in assuming that you’re referring to law abiding landlords, and not absentee or slum landlords with your interpretation of the law? The cost for a tenant whose been a victim in such cases can be just as high and as non-collectable as the tenants you speak of in your scenario. Maybe you should also include the “excuses” poor landlords come up with in these instances as well because all tenants are not as poorly educated or mannered as your post suggests.
I am glad you are here and do what you do as we’ve learned a lot as tenants from reading your blog. It has helped us deal with our absentee landlord and to prepare for a legal battle with regards to our security deposit even after exiting via the terms of our 1 year lease and cleaning the rental unit to make sure it was in the same condition we received it in.
Cheers….I hope Milwaukee County sorts out these issues so that honest Landlords and Tenants are treated properly.
#7 by Tristan R. Pettit, Esq. on August 9th, 2011
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Shawn — Thank you for your comments. No, your assumption would be incorrect. The same law applies to everyone. So the holdover damages statute that I refer to in my post applies to all landlords where the tenant holds over — even the “slumlords” as you refer to them. The law should apply equally to everyone, not just to those people that one person — in this case you — think is “correct” or “in the right.”
I appreciate your suggestion of writing a post on excuses that landlords make, but I will politely decline. My intended audience is landlords and property managers — so it would not make a lot of sense for me to attack my audience. There are enough blogs out there where tenants rant about their landlord to fill that niche.
As mentioned above, tenants such as yourself are not my intended audience, but I am happy to learn that you have become more educated from reading my blog. Education helps everyone. Please remember that my blog is not intended to give legal advise, so I would reccomend that you retain a lawyer to assist you if you intend to move forward with your alleged claims.
Take care and thanks for reading
T
#8 by Peter B. on September 30th, 2011
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Good Evening Attorney Pettit,
Thank you for this post and for all of your posts. My colleagues and I are very appreciative of your efforts to clarify the confusion inherent in landlord-tenant relationships.
I hope that you can clear up some confusion I have regarding double damages. Is a landlord entitled to double rent as damages for the days a tenant holds over in ADDITION to the monthly rental? Or is the landlord only entitled to collect rent for the days the tenant holds over at double its rate?
For example, if a tenant paying $600/mo rent gives a proper notice to move, effective March 31 (the end of the lease term), but does not move out until April 5, is the landlord entitled to April’s rent of $600 plus $100 in damages for holding over? Or is the landlord only entitled to to $200 ($20/day doubled x 5 days) for the 5-day holdover?
I’m not sure If my interpretation of Statute 704 that damages and rent are separate is correct. Am I correct in thinking that if a tenant is living in an apartment in April, then they owe the full rent for April and double rent for the several days as a penalty for not moving out when they were supposed to? Any thoughts you have on the subject would be greatly appreciated. Thank you.
Peter B.
#9 by Tristan R. Pettit, Esq. on October 4th, 2011
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Peter — thanks for your kind words. With regard to your question on double damages, my reading of the statute allows you to sue and recover for double rent from the period that the tenant became a holdover tenant (after the expiration of the notice) until they vacate. So for instance if a 5 day notice was served in person on a tenant on October 5th they would have until 10-10 to vacate. As of 10-11 they are a holdover tenant ant incurring double rent until the day they vacate. So let’s say that the tenant remains in the unit until 10-31. You would be entitled to all of your rent for October plus double the rent apportioned on a daily basis from 10-11 through 10-31 (holdover damages) when they vacated. If the tenant’s lease ran through November, and you were unable to re-rent the unit for that month, then the tenant would also be on the hook for November’s rent but not holdover damages for November because the tenant vacated on 10-31.
Regarding your example: The tenant becomes a holdover tenant as of 4-1 and you are entitled to holdover damages from 4-1 through 4-5. Whether or not you are entitled to all of April’s rent in addition is dependant on if you were able to re-rent the unit for any portion of the month and if you made reasonable efforts to re-rent the unit for the tenant. Assuming that you did make reasonable efforts to rerent and could not re-rent for April, then the tenant should be responsible for all of April’s rent plus holdover damages only from 4-1 through 4-5.
The tenant could be held responsible for more than holdover damages however if you incurred greater damages as a result of the tenant’s holdover. For example, lets say that youy had the unit re-rented for 4-1 and the new tenant couldn’t move in on 4-1 and decided to sue you to void the lease – since you coulnd’t honor the move-in date – and sue you for damages incurred such a the cost of a motel room etc., and demand her security deposit back and her April’s rent back. Now your damages as a result of the tenant’s holdover would be greater than double daily rent and you could sue the tenant for your actual damages as a result of losing that new tenant and the amount the new tenant is suing you for for breaching the lease because she couldn’t move in as promised
#10 by John Rohner on February 24th, 2012
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Just came from a meeting with a Milwaukee court commisioner where she rejected my holdover damages.
I had done a 14-day notice, and two weeks after the lease termnation got an eviction from the judge with a stipulated tenant-to-be-out-by date two weeks later. The tenant had been in arrears 1.5 months by the time he left.
The commisioner seemed a little confused when I pressed, but she seemed to say that it could only be done with a 5-day notice, and possibly you can’t do a stipulation either. Like the stipuation meant I approved of the tenant remaining (my thought). Next time a judge offers this stipulation, I’ll ask him about this–he’ll probably say can’t give legal advice, however.
#11 by Tristan R. Pettit, Esq. on February 24th, 2012
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John – I’m sorry to hear about your recent experience. Entering into a stipulated dismissal does not waive your right to collect holdover damages. I have not had problems getting holdover damages from any of the court commissioners in Milwaukee County for my clients, so I wonder if there was something else at play — dont know as I don’t know all of the facts.
I am aware of 1 commissioner that says in a month to month tenancy you can either get holdover damages or the additional month rent for failure to give notice to vacate (assuming a 30 day notice was required) but not both. I think this is an incorrect interpretation of the law but it is something that we have to deal with. So possibly that was your situation.
T
#12 by Peter B. on April 12th, 2012
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Good Afternoon Tristan,
A friend of mine was recently in court and he told me that the commissioner in his case interpreted Statute 704 to read that a landlord is only entitled to holdover damages, and not a full month’s rent, if a tenant does not vacate at the end of their lease term. This tenant’s lease ended on 8-31, but the tenant held over until 9-5. The commissioner decided that the landlord was only entitled to $200 for the holdover, and not $600 for all of September’s rent even though there was no disputation that the landlord complied with the statute and tried to re-rent the unit, but was unsuccessful.
I know the commissioner’s interpretation is wrong, but I do not know which section of Statute 704 covers the issue of rent for the month during a holdover. 704.25(1) provides for the recovery of “damages” if a tenant holds over, but does not address rent; 704.25(2) covers the creation of a periodic tenancy after a holdover but requires the landlord to “elect” to do so by accepting rent or manifesting an intent to allow the tenant to stay; and 704.27 only addresses damages.
Do you know which section of 704 covers whether a landlord is entitled to rent when a tenant holds over? Is there any case law which covers this issue? Any information you have on this subject will be greatly appreciated. Thank you.
#13 by Tristan R. Pettit, Esq. on April 12th, 2012
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Peter – I have come across one comissioner who refuses to give a landlord both the full month rent and holdover damages in a month to month tenancy. I believe a few other commissioners follow this also.
I disagree with that interpretation as well but not much you can do other than request that it be transferred to the judge and make your argument to the judge.
There is not a statute or regulation or case law exactly on point on this issue that I am aware of. You are already aware of the holdover damages statute. As to the monthly rent, the argument is really one of common sense. If the tenant was in the unit for even one day the entire month’s rent is owed subject to your duty to mitigate. If tenant’s broke the agreement and moved out or was evicted, tenant remains responsible for full rent subject to your duty to mitigate.
The holdover damages statute is in addition to the above regular rent damage but there is not a case where the court comes out to and says that — because a landlord hasnt appealed the issue due to the time and costs involved to do so.
So the key in my opinionn is whether you are dealing with a lease or m2m. If m2m you may be out of luck but you can try arguing to the judge.
#14 by caroline on January 29th, 2013
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Is a tenant liable for holdover damages if the landlord was not charging rent and the property has been foreclosed on due to lack of payment while the tenant is living on the property?
#15 by Tristan R. Pettit, Esq. on January 31st, 2013
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Caroline — I cannot give legal advice via this blog but I can address the issues you write about generally
Holdover damages apply to the period from when the lease ended or the notice terminated tenancy expired through the date that the tenant vacated. The landlord is entitled to double the rent apportioned on a daily basis for that period.
If no rent was ever charged of the tenant —- i.e. tenant at will — then double daily rent of $0 is still $0.
A landlord still owns the property even if a foreclosure has been filed. The landlord remains the owner until such time as the Court confrims the Sheriff’s sale. Until that date, the landlord is still entitled to rent even if s/he is not paying it to the lender.