I receive many calls from landlords who have questions and concerns involving issues involving their tenant roommates. While the problems are often factualy different the proper way to analyze the situation and arrive at a resolution to the problem, often depends on the same thing — something called “joint and several liability.”
Joint and several liability is a legal concept that, according to Black’s Law Dictionary, is defined as “the liability of copromisors of the same performance when each of them, individually, has the duty of fully performing the obligation. A liability is said to be joint and several when the creditor may demand payment or sue one or more of the parties to such liability seperately, or all of them together at his option.”
Confused yet? Let me try and explain joint and several liability more clearly than Mr. Black did.
Essentially joint and several liability means that each individual tenant is responsible for the full amount of the rent as well as any and all other obligations under the rental agreement.
I think it would be easier for landlords to comprehend the concept of joint and several liability if they would just think of and treat roommates as one person.
Here is an example:
A Landlord enters into a 12 month lease with Tenant A, Tenant B, and Tenant C. The monthly rent is $750. The security deposit is also $750.
The Landlord needs to remember that he has one lease with three tenants NOT three separate leases with one tenant. As such all three tenants are responsible for the full amount of rent. All three tenants are responsible for abiding by the rules and regulations. All three tenants are responsible for paying the security deposit. All three tenants are responsible for paying the full amount of any damages to the rental unit.
Instead of taking $250 from Tenant A, B, and C for rent (or the security deposit), the landlord should insist that rent be paid via one payment for the full amount. When landlords accept $250 from each tenant, the landlord is inadvertantly telling the three tenants that each of them is only responsible for 1/3 of the rent — that is wrong. Remember treat the roommates as one person – one person pays his entire rent not 1/3 of it.
I know many of you that have tenant roommates are thinking that there is nothing wrong with accepting three separate checks for $250 from your three tenants. You are correct, nothing is wrong, there is nothing wrong with doing that . . . AS LONG AS ALL OF THE TENANTS PAY RENT ALL OF THE TIME. But problems arise is when one tenant falls on hard times and doesn’t have the money to pay rent. It is at this point that the other two tenants start telling the landlord, “well we paid my portion of the rent so you can’t evict us.” WRONG.
Once again, think of roommates as one person. When you have one tenant (no roommates), that tenant is responsible for paying the entire amount of the rent – not just a portion of it. The same goes with roommates. One roommate is not just responsible for paying 1/3 of the rent. Under joint and several liability, that one tenant roommate is responsible for paying all of the rent if the other tenants don’t pay any rent. If Tenant A and Tenant B have no money to pay rent, then Tenant C better rise to the occasion and pay the full rent amount or else all three roommates can be evicted.
Tenant roommates do not understand the concept of joint and several liability. I believe it is in the landlord’s best interest to take the time to teach his tenant roommates about joint and several liability and how it specifically applies to them and their roommate situation. The best way to do demonstrate joint and several liability to your tenant roommates, after you have had the discussion with them, is to make them write one check for rent. I tell my roomate tenants that they must pay rent with one check. I don’t care who pays it but I will only accept one check for the full amount of rent. The tenants can fight amongst themselves as to how they divide up the rent amount or who owes what to whom. How they do that should not be the landlord’s concern. The landlord wants to impress upon his tenant roommates that he expects the full amount of rent each month and if they do that then they can remain as tenants. If not, then they will be evicted.
So while it may seem a bit much to refuse to take more then one rent check from tenant roommates, I believe by making the tenants understand that they are not responsible for just a “portion” of the rent, a landlord can avoid a lot of problems in the future.
Let’s turn our focus to tenant roommates and the security deposit. If a landlord makes the mistake of accepting $250 from each of his three tenant roommates to apply to the $750 total security deposit, I believe that the landlord is sending his new tenants the wrong message again. Whether he is aware of it or not, the landlord has unintentionally informed his tenants that each of them are only responsible for 1/3 of the security deposit and therefore only responsible for 1/3 of any damage to the unit.
How many times have you heard one tenant say that the hole in the wall was caused by the other roommate who came home drunk one night and put his fist through the drywall? And then the next comment out of that tenant’s mouth was, “so you should take the cost to repair that wall out of his portion of the security deposit.”
Each tenant is jointly and severally liable for paying the total amount of the security deposit and for the total amount of any damage caused to a rental property regardless of which tenant caused the damage. A tenant roommate is not just responsible for “his portion” of any damage. Under joint and several liability, if the cost to repair the wall is $500 then the landlord can keep $500 of the security deposit and the three roommates can fight over how to split up the remaining $250.
What if your tenant roommates cause major damage to the rental unit that goes well beyond the security deposit on hand. Let’s say the damages total $5,000. Under the concept of joint and several liability, a landlord can choose to sue all three of the tenants for the $5,000 or the landlord can choose to sue only two of them for the $5,000 (the two that are gainfully employed, for example) or the landlord could even opt to sue just one of the three roommates for the entire $5,000.
Assuming the landlord could prove his damages and meet his burden of proof, the court could rightfully enter a judgment of $5,000 against only Tenant A, if that is the only tenant that the landlord sued. This is true even if it was Tenant C that caused the actual damage. The landlord could then pursue and collect the entire $5,000 from Tenant A. It would then be up to Tenant A to sue either Tenant B or Tenant C, or both, if he so chooses.
Please note that joint and several liability does not allow a landlord to obtain a double or triple “windfall.” A landlord can’t sue each tenant individually for the full $5,000 and end up with three judgments totaling $15,000. This is why the most practical course of action is typically for the landlord to sue all three tenants for the entire $5,000 and then decide which tenant is more “collectible” (and often more responsible) and pursue the collection of the judgment against only that one tenant.
Now, let’s assume there is no damage to the rental unit after the three tenants move out and therefore the entire security deposit will end up being returned. How is the landlord to return the security deposit? Under Wisconsin law, specifically Wisconsin Administrative Code, ATCP 134.06(2)(d), a landlord is required to refund the entire security deposit in one “check, draft or money order made payable to all tenants who are parties to the rental agreement unless the tenants designate a payee in writing.” So under ATCP 134.06(2)(d), a landlord is required to treat the tenant roommates as one person – by sending them one check made payable to all three of them. If a landlord ended up writing three separate checks to each of the tenants for 1/3 of the security deposit each, that landlord would be violating Wisconsin law.
So, if a landlord treats his tenant roommate as one person, he will not only be adhering to the concept of joint and several liability, he will make his life as a landlord more simple. Landlords should not have to get involved in trying to determine which roommate did or didn’t pay “his portion of the rent” nor should a landlord be concerned with which roommate punched a hole in the drywall during a drunken rampage. It is not our job as landlords to be social workers and resolve disputes amongst roommates. Nor is it our job to be the judge or jury and determine which roommate was at fault. Fortunately, the concept of joint and several liability allows a landlord the ability to avoid all of that unnecessary drama.
NOTE: If the rental agreement you are currently using does not indicate that all tenants are ”jointly and severally liability” for all obligations under the rental agreement, then it is not a well-written rental agreement and is not worth the paper that it is written on. If that is the case, you should tear it up at the first possible legal opportunity — i.e. once the term ends if it is a lease or with 28 day’s notice if it is a month to month tenancy. You should then purchase and start using a rental agreement that states that all tenants are jointly and severally liable. I hear that the Rental Agreement sold at Wisconsin Legal Blank Company, Inc. is a very good one — someone told me that the author of it is pretty knowledgable about Landlord-Tenant Law.
#1 by Brian on September 23rd, 2011
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If you just happen to have stumbled across this blog, I would highly suggest you subscribe to it, especially if you are in Wisconsin. The wealth of information here is priceless! Thanks Tristan
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#2 by John H. (Dr. Rent) Fischer on September 26th, 2011
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I often teach classes in college towns, like Stevens Point where it is very common in student rentals to instead of doing one lease with 4 names, do four separate leases.
This is done for the convience of the renter… but it opens the door for tenants blaming co-tenants for specific damages.
Joint and Several liability is magic, its right up there with compounding interest… and it is a great tool to have available to you.
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#3 by Peter B. on December 20th, 2011
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Attorney Pettit,
Thank you for this post – it is very helpful for landlords like me who have many roommate tenancies. There is, however, one aspect of the security deposit disposition I am hoping you can clarify.
To which of the three tenants in your example would the landlord mail the refund check? What if all three provided the landlord with different forwarding addresses?
ATCP 134 is very clear that the check, draft or money order must be made payable to all three tenants, but it does not say which tenant a landlord should mail the check, draft or money order to.
Any thoughts you have on the subject will be greatly appreciated. Thank you.
#4 by Tristan R. Pettit, Esq. on December 22nd, 2011
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Peter — Great question. The law is silent on that issue . . . there is no statute, regulation or case that answers your question. What I have done, and what I have instructed my clients to do in these situations is as follows:
Make the check payable to all tenants named on the lease. Mail the check to the tenant who provided you with a forwarding address (if any) and enclose a transmittal letter to the roomate indicating that you are sending copies of this letter and the enclosed checks to the other roomates to their last known address (your rental property) or their forwarding address (if they gave you one). Any tenant that did not give you a forwarding address, make a photocopy of the check and the transmittal letter and send to them so that they know to which roommate you sent the check so they can contact him or her.
If they all gave you forwardiing addresses or none of them gave you a forwarding address then take your pick as to whom to send the actual refund check.
I think the key things to remember are:
1. The security deposit refund check should be made payable to all tenants
2. The security deposit refund check is mailed to one of the tenants within the required time period (21 days from the date of surrender).
3. You provide notice to the other tenants that you sent the refund check to Roommate X.
This now gives the tenants enough information to sort it out amongst themselves and you have complied with all regulations and laws.
#5 by Brian K on October 25th, 2012
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I avoid rommmate situations for all of the reasons raised in this blog. I am quite familiar with joint and several liability, but I don’t believe the courts are.
Since you brought up the rental agreement form available at Wisconsin Legal Blank, I have a question about it.
This form requires a 30 day notice of termination from the tenant for a month-to month agreement. Does requiring 30 days from the tenant then require 30 from the landlord? Or more properly, do the courts interpret this clause as requiring 30 from the landlord even though that is not in the form and the law requires 28.
In any event, I just noticed this clause in these forms and am now striking it. I like to be able to give a 28 day notice on the 1st or 2d and sometimes the 3d.
#6 by Tristan R. Pettit, Esq. on October 25th, 2012
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Really, I have had good luck with joint and several liability issues in the courts — never had a problem to date (knock on wood).
Yes, if you require a tenant to give you a 30 day notice (or 60 day notice or whatever) then you are required to give the same —- what is good for the goose is good for the gander.
Yes, some people prefer the 28 day notice. Other like the 30 day – since it is closer to an actual month. I personally use a 60 day notice. The law says that the notice must be “at least 28 days” — so you can choose what you want as long as it is clearly set forth in the lease.
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#7 by Susan A on April 12th, 2013
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Because I do not want to wait for for the rent payment until one of the co-tenants collects from their co-tenants, I state that it is not Owner’s concern on how the rent is proportioned between multiple co-renters. Each co-tenant is considered responsible for shortfalls in the full month’s rent, regardless of how many and whose individual checks are received by the landlord.
Does that work?
#8 by Tristan R. Pettit, Esq. on April 15th, 2013
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What you have in your lease is better than if you didnt address the issue. I still think the way I suggest it should be handled is legally the best way but I understand your practical concerns. Whether or not it your way will work will remain unknown until a court addresses your specific fact situation should an issue arise.
The reason that I prefer my method is also to teach tenants about joint and several liability.