Archive for category Rental Agreements

Newly revised Landlord-Tenant Law Forms Available at Wisconsin Legal Blank on April 2 and April 3, 2012.

Apr 2

Posted by Tristan R. Pettit, Esq. in Notices, Rental Agreements, Rental Documents | 4 Comments

Wisconsin’s Landlord Omnibus Law (Act 143) went into effect today – April 1, 2012.  As a result of the new law it was necessary for me to update many of the landlord-tenant law forms that are sold at Wisconisn Legal Blank.

 

As of Monday, April 2, 2012, the following revised forms will be available:

1.   Residential Rental Agreement  (Form #19)

-  Added language required in order for landlord to be able to dispose of tenant’s abandoned property immediately after they vacate.

-  Added language about any illegal clause in the rental agreement being severable from the n9on-illegal clauses.

-  Correction of some grammar and punctuation mistakes.

2.   Nonstandard Rental Provisions (Form #984)

-  Added langauge required in order for landlord to be able to dispose of tenant’s abandoned property immediately after they vacate.

-  Revised language as to when landlord must return security deposit or supply security deposit itemization letter when tenant vacates prior to end of lease term.

-  General revisions to the language of each nonstandard rental provision to comply better with the holding in the Tschantz case.

3.  Notice of Rent Increase in Month to Month Tenancies (Form #332)

-  Added langauge required in order for landlord to be able to dispose of tenant’s abandoned property immediately after they vacate.

4.  Residential Lease Renewal or Notice To Vacate (Form #970)

-  Added langauge required in order for landlord to be able to dispose of tenant’s abandoned property immediately after they vacate.

5.   Tenant Inspection Sheet (Check-In – Check-Out Form)

-   Revised the title of this form to comply with the title used in the new law.

NOTE:  It is now required that a landlord give this document to tenant’s upon occupancy.  So if you have not previously used this document you need to start doing so now.

 

As of Tuesday, April 3, 2012 the following revised forms will be available for purchase at Wisconsin Legal Blank

6.   5 Day Notice To Pay Rent or Vacate (Form #328)

-  Changed the word “may” to “shall” when advising the tenant that landlord is entitled to holdover damages of, at a minimum, double the daily rent for the holdover period.

-  Added a line for “Total Amount Due”

7.   5 Day Notice To Correct Breach or Vacate (Form #330)

-  Changed the word “may” to “shall” when advising the tenant that landlord is entitled toholdover damages of, at a minimum, double the daily rent for the holdover period.

8.  5 Day Notice To Vacate – Nuisance (Form #329)

-  Changed the word “may” to “shall” when advising the tenant that landlord is entitled toholdover damages of, at a minimum, double the daily rent for the holdover period.

9.   14 Day Notice To Vacate for Failure To Pay Rent (Form #768)

-  Changed the word “may” to “shall” when advising the tenant that landlord is entitled toholdover damages of, at a minimum, double the daily rent for the holdover period.

-  Added a line for “Total Amount Due”

10.   14 Day Notice To Vacate For Breach of Rental Agreement (Form #767)

-  Changed the word “may” to “shall” when advising the tenant that landlord is entitled toholdover damages of, at a minimum, double the daily rent for the holdover period.

11.   28 Day Notice Terminating Tenancy (Form #327)

-  Changed the word “may” to “shall” when advising the tenant that landlord is entitled toholdover damages of, at a minimum, double the daily rent for the holdover period.

12.  30 Day Notice To Correct Breach or Vacate (Form #325)

-  Changed the word “may” to “shall” when advising the tenant that landlord is entitled toholdover damages of, at a minimum, double the daily rent for the holdover period.

 

Sometime in the near future the following revised form will be available at Wisconsin Legal Blank:

13.   Rules & Regulations (Form #994)

-  Will inlcude major revisions including language, organization and format.

-  Will include revised language regarding a tenant’s responsibility for the actions of their guests, invitees and family members that will comply with the law and not run afoul of “Deadly Sin #8″ created by the new law.

 

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2011 Wisconsin Act 143 (Landlord Omnibus Law) Also Applies To Commercial Landlord-Tenant Law

Mar 29

Posted by Tristan R. Pettit, Esq. in ATCP 134, Attorney's Fees, Commercial L-T Law, Holdover Damages, Landlord Liability, Legislation, Property Management, Rental Agreements, Rental Documents, Security Deposit, State of Wisconsin | No Comments

While this blog primarily focuses on residential landlord-tenant law, on occasion I also touch on issues applicable to commercial landlord-tenant law.  This is one such instance.

Commercial landlord-tenant is more straightforward than residential in my opinion because commercial tenancies are less regulated than residential.  Typically what a commercial landlord and tenant agreed to and placed into their lease agreement is what governs.  The Wisconsin Administrative Code’s ATCP 134 does not apply to commercial leases and most of Chapter 704 of the Wisconsin Statutes does not apply to commercial leases unless (1) the parties had no written lease, or (2) the lease was silent as to certain issues (see sec. 704.03 and 704.05 respectively).

Well, that has all changed now with the passage of 2011 Wisconsin Act 143 which was signed into law last week and will take effect on March 31, 2012.

While almost all of the attention paid to the new law surrounded its effects on residential landlord-tenant law, the law also impacts the commercial arena as well.  I too was caught up in the effect Act 143 would have on residential landlords and missed the applicability of this new law to commercial landlords initially  — thanks to Bob Anderson of Legal Aid of Wisconsin for redirecting me : )

As I have mentioned in prior posts, this legislation was fast-tracked for some reason and rushing new laws through the legislative process is never a good thing.  In fact it is a recipe for disaster.

It appears that the legislators did not realize that Senate Bill 466 — the precursor to Act 143 — was written in such a way as to encompass commercial landlord-tenant law.  When it was brought to their attention, a quick amendment was made to exclude one portion of the new law (the section that makes a rental agreement void if it contains certain prohibited language) from the commercial arena, but apparently there was not enough time to deal with the other sections of the new law, which now will apply to both commercial and residential tenancies.

So what do we have?

The following provisions of Act 143 apply to both commercial landlord-tenant law as well as residential:

1.  Moratorium on evictions

2.  Severability of rental agreement provisions

3.  Disposition of abandoned property

4.  Requirement that landlords receive an award of holdover damages when appropriate

5.  Acceptance of past due rents

6.  Withholding from and return of security deposits

7.  Making any violation of chapter 704 a possible unfair trade practice

If you are unfamiliar with the above sections of the new law you should read my prior post summarizing the new law.

Number 1-5 above actually benefit commercial landlords.  However numbers 6 and 7 are problematic

By adding ATCP 134.06, which focuses on the withholding from and the return of security deposits, to chapter 704, the new law has now made these requirements applicable to commercial landlords as well.  Prior to Act 143 being passed, there was no law addressing what a commercial landlord could withhold from a commercial tenant’s security deposit, nor was there any law regarding when that security deposit (or an itemization as to how the security deposit was applied) had to be returned to the commercial tenant.  Well thanks to Act 143, now there is.

Act 143 allows a commercial landlord to only make deductions for the following items from a commercial tenant’s security deposit:

704.28 Withholding from and return of security deposits.  (1) Standard withholding provisions.  When a landlord returns a security deposit to a tenant after the tenant vacates the premises, the landlord may withhold from the full amount of the security deposit only amounts reasonably necessary to pay for any of the following:

(a)  Except as provided in sub. (3), tenant damage, waste, or neglect of the premises.

(b)  Unpaid rent for which the tenant is legally responsible, subject to s. 704.29.

(c)  Payment that the tenant owes under the rental agreement for utility service provided by the landlord but not included in the rent.

(d)  Payment that the tenant owes for direct utility service provided by a government-owned utility, to the extent that the landlord becomes liable for the tenant’s nonpayment.

(e)  Unpaid monthly municipal permit fees assessed against the tenant by a local unit of government under s. 66.0435 (3), to the extent that the landlord becomes liable for the tenant’s nonpayment.

(f)  Any other payment for a reason provided in a nonstandard rental provision document described in sub. (2).

So if a commercial landlord would now like to deduct anything other then the items listed in (a) – (e) above, then that landlord needs to start using a separate written document entitled “Nonstandard Rental Provisions” which must list the additional fees/costs that can be deducted from a commercial tenant’s security deposit.

Additionally, Act 143 now requires a commercial landlord to either (1) return the tenant’s security deposit to them, or (2) send them an itemization explaining how that security deposit was applied, within 21 days of the following:

(4) Timing for return.  A landlord shall deliver or mail to a tenant the full amount of any security deposit paid by the tenant, less any amounts that may be withheld under subs. (1) and (2), within 21 days after any of the following:

(a)  If the tenant vacates the premises on the termination date of the rental agreement, the date on which the rental agreement terminates.

(b)  If the tenant vacates the premises before the termination date of the rental agreement, the date on which the tenant’s rental agreement terminates or, if the landlord rerents the premises before the tenant’s rental agreement terminates, the date on which the new tenant’s tenancy begins.

(c)  If the tenant vacates the premises after the termination date of the rental agreement, the date on which the landlord learns that the tenant has vacated the premises.

(d)  If the tenant is evicted, the date on which a writ of restitution is executed or the date on which the landlord learns that the tenant has vacated the premises, whichever occurs first.

Commercial landlords never had to worry about that 21 day time frame before — now they do.  Needless to say it is much more difficult and time consuming to do a walkthrough of a giant commercial space and itemize any damages or cleaning charges than it is for a 500 square foot residential rental unit.  I’m not exactly sure how commercial landlords will be able to comply with this time frame, but they will need to find a way, or else they may have to to their tenant double damages and attorney’s fees.  Which leads me to the next concern . . .

Act 143 now makes any violation of chapter 704 a possible violation of unfair trade practices, which pursuant to sec. 100.20, Wis. Stats. allows a tenant to sue a landlord for double damages and attorney’s fees.  Prior to Act 143 a commercial landlord was not in this predicament because unfair trade practices were set forth in ATCP 134 which only applied to residential tenancies.  But now that Act 143 incorporates some provisions of ATCP 134 into chapter 704 — and chapter 704 applies to commercial landlord-tenant relations — things are different.

Here is the language of the new law:

704.95  Practices regulated by the department of agriculture, trade and consumer protection.  Practices in violation of this chapter may also constitute unfair methods of competition or unfair trade practices under s. 100.20.  However, the department of agriculture, trade and consumer protection may not issue an order or promulgate a rule under s. 100.20 that changes any right or duty under this chapter.

I guess the only positive is that the new law says “may constitute” instead of “shall constitute” however to a commercial landlord that never had to worry about anything they did constituting an unfair trade practice and subjecting themselves to being sued for double damages and attorney’s fees, I’m sure this will be of little consolation.

So not only will Act 143 require commercial landlords to make some modifications to the language in their leases, but it will require them to completely change how they run their commercial proeprty management businesses starting March 31, 2012 —- 2 DAYS FROM NOW!!!!!

 

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Landlord’s Omnibus Bill Signed Into Law – Read It Now

Mar 23

Posted by Tristan R. Pettit, Esq. in AASEW, ATCP 134, Legislation, Rental Agreements, Rental Documents, State of Wisconsin | 3 Comments

Governor Walker did sign the Landlord’s Omnibus Bill into law.

I appreciate the effort of everyone that called the Governor’s office asking him to veto the bill due to its deficiencies.

Here is a link to the new law.  Much easier to read than having to go back and forth between the orginal bill, the Substitute bill and the two amendments.

The two main concerns that I have with the law and which caused me to ask that the bill be vetoed. They are section 35M and section 36.

The AASEW has already spoken with Sen. Lassee’s office regarding these two major problems and I will keep you informed if and when anything is done about them.

And yes, I will be reviewing all of Wisconsin Legal Blank’s forms in the near future and making the necessary revisions – if needed – and will let you know when they will be available : )

Upon Further Reflection, I Think The Governor Should Veto The Landlord’s Omnibus Bill

Mar 21

Posted by Tristan R. Pettit, Esq. in Legislation, Notices, Rental Agreements, Rental Documents | 3 Comments

I spent several hours yesterday reviewing and thinking about the new Landlord’s Omnibus Bill that is to be signed into law today by Governor Walker at 4 pm.

I then spent hours of time trying to summarize the new law in yesterday’s blog post in an easy to read and understand format.

Since publishing the blog post yesterday I have a few more thoughts and concerns:

1.  AASEW Board member and friend Tim Ballering pointed out to me that he believes that the new law as written will allow for any violation of Chapter 704 to be considered an unfair trade practice, thus allowing a tenant to sue his/her landlord for double damages and attorney’s fees.

Here is the language at issue:

704.95 Practices regulated by the department of agriculture, trade and consumer protection.

Practices in violation of this chapter may also constitute unfair methods of competition or unfair trade practices under s. 100.20. However, the department of agriculture, trade and consumer protection may not issue an order or promulgate a rule under s. 100.20 that changes any right or duty arising under this chapter.

In my prior post I did anticipate that this would allow for tenant’s and attorney’s to make arguments that any violation of Chapter 704 was an unfair trade practice and that concerned me.  But after speaking with Tim and thinking about this in more deeply, and re-reading the new law – I think this is a major concern.  So is this law saying that if a landlord improperly drafts or serves a 5 day notice that s/he can be sued by the tenant for double damages and attorney’s fees?  YES.

I believe that this is such a major problem that I will be contacting Governor Walker’s office today before 4 pm and asking him to veto the bill.

2.  The addition of the 8th Deadly Sin really concerns me.  My friend and past Wisconsin Apartment Association President John Fischer succinctly addresses the problem with in an email that he sent to many in the industry which is reproduced below:

When the Housing Task force was looking at blight, blight went beyond just condition of the property, but it also went to criminal activity.

There has been a proposal that various apartment associations have been working on that would make it easier to evict a tenant for criminal activity.  There is a “Crime Free Lease” program that started out west that is very popular with landlords and law enforcement.  A few communities have started working on this program here in Wisconsin, but the biggest hurdle is that the key tool of this program is a “Crime Free Lease Addendum”.  The problem is that this addendum is unenforceable under Wisconsin’s current laws.

The new law that is being signed by Governor Walker at 4 PM this afternoon (I have been invited to this private signing, but I want nothing to do with this) makes a large number of massive changes to Wisconsin landlord-tenant law.  One of the most significant appears to be an answer to our attempts to allow for eviction for criminal activity.  The new law would basically render a lease void if the lease contained language that criminal activity on a property would be a breach of the lease.

So there you have it.  My take on this new law — as well as many others in the industry — is this new law will cause more harm then good.  This is what happens when you try to rush legislation — people do not have time to consider all of the different angles — so I am planning on contacting Governor Walker and ask him to veto SB 446.  I would ask that you consider doing the same.

Thank you to tim Ballering and John Fischer for their thoughts, opinions, and guidance.

 

Landlord’s Omnibus Bill — with Amendments — To Be Signed Into Law Today

Mar 20

Posted by Tristan R. Pettit, Esq. in ATCP 134, Legislation, Rental Agreements, Rental Documents, State of Wisconsin | 7 Comments

One of the biggest pieces of pro-Landlord legislation in quite some time was passed by the Wisconsin Senate and adopted by the Assembly recently and will be signed into law by Governor Walker today.  Unfortunately some of the pro-Landlord provisions were amended, diluted, or removed.

I am certainly not denouncing this new law.  Many aspects of it will be very helpful to landlords.  I just wish that more time had been allowed — the bill was fast-tracked — to allow for more discussion, thought and input and allowing for more notice.  For instance, many of us in the rental industry were given one day advance notice before the public hearing on the bill which prevented many of us from attending.

I will attempt to summarize the new law in this post.  As this new law plays out in the “real world” I am sure that I will be devoting additional blog posts to each provision in more detail.

The proposed effective date of this new law is March 31, 2012.  So many of us will need to make some additions and/or modifications to our rental documents prior to that date.

 

Bankground of Legislation

The Landlord’s mnibus bill (Senate Bill 466) was put on the “fast track” for reasons unknown to me.  It was introduced on February 13, 2012 by Senator Lassee.  A Substitute Amendement 1 was offered by Senator Lassee on February 29, 2012.  Senator Waangard then offered the first amendment to the Substitute Amendment on March 6th which was passed March 13th.  Senator Lassee then offered a second amendment to the Substitute Amendment on March 12th which was passed on March 13th.  The bill will be signed into law by Governor Walker today – March 21st.  Approximately one month from introduction to passage into law is very fast for the legislative process.

The key provisions of the new law are:

 

1.   Moratorium on Evictions

This provision of the original bill remained untouched by the Substitute Amendment and the two amendments to the Substitute Amendment.  The new law prohibits any municipality from imposing a moratorium on eviction actions.   If a municipality has a current ordinance that contradicts this new law it cannnot be enforced.

We now must hope that individual counties, courts, and commissioners adhere to this law.  While I don’t anticipate courts ignoring this new law, I do anticipate court’s continuing to use the “stay” provisions of sec. 799.44(3) to give tenants additional time to vacate during the holidays.  So while municipalities will no longer be allowed to impose moratoriums, courts can still prevent evictions during holidays, creating the same result.

 

2.   Severability of Rental Agreement Provisions

The original bill stated that any provision could be severed from the agreement.  So if a landlord inadvertantly included a provision that was found to be improper or retaliatory in nature it could be removed and the remainder of the agreement could be enforced.

The Substitute Amendment diluted the above considerably by adding that if a rental agreement contains one of the “7 Deadly Sins” set forth in ATCP 134.08, the inclusion of any of those provisions cannot be removed and will render the entire rental agreement void and therefore unenforceable.

Amendment 1 to the Substitute Amendment went a step further and added an 8th illegal provision that if included in a rental agreement will cause the rental agreement to be void.  The new illegal provision would include any language that allows a landlord to terminate a tenant’s tenancy if a crime is committed in or on the rental property, even if the tenant couldn’t reasonably have prevented the crime.

So in the end, the new law only allows the severability of certain rental provisions.  If your rental agreement contains one of the 7 prohibited provisions set forth in ATCP 134.08 or the new prohibited provision created by this new law, your rental agreement will still be be void and unenforceable.  Essentially, the new law takes the regulation ATCP 134.08 and codifies it into law.

More tragic is what the “8th Deady Sin” has most likely done to some other pro-Landlord legislation that I had hoped would become law — the “Crime-Free Lease Addendum” bill.  If you read my prior post on the Crime-Free Lease Addendum bill you will see that this 8th Deadly Sin language effectively decapitates this proposed bill.  This is a major disappointment as I believe that had the Crime-Free Lease Addendum bill been passed it would have been the most significant piece of pro-Landlord legislation in years.  Instead the “odds and ends” Landlord Omnibus bill seems to have killed it.  Hopefully, I am wrong and it can be resurrected.

 

3.   Dispostion of Tenant’s Abandoned Property

Once again, the original version of this bill was awesome.  It stated that any personal property left behind by a tenant could be considered abandoned and disposed of immediately in the landlord’s discretion.

The Substitute Amendment modified the original bill by adding that any medical prescriptions and/or medical equipment left behind by the tenant must be held by the Landlord for 7 days.  The Substitute Amendment also added that written notice must be sent to the tenant (and any secured party) prior to disposing of any titled vehicles or mobile homes deemed abandoned.  I could live with both of those modifications.

However, the amendments to the Substitute Amendment added language that will require landlords to jump through a few hoops.  The new law requires that a landlord provide written notice to the tenant at the time of entering into the rental agreement, and at each renewal of the rental agreement, informing the tenant that the landlord will not hold any property left by the tenant and that such property will be deemed abandoned and will be disposed of.  Failure to provide this written notice to the tenant requires a landlord hold the abandoned property fpr a period of time as set forth in sec. 704.05 (5), Wis. Stats.

Essentially landlords will now be required to add a new language to their rental agreements – and any renewal agreements – advising tenants that any property left behind will be considered abandoned and can be disposed of.  Looks like there will be a revised Rental Agreement being sold at Wisconsin Legal Blank Co., in the near future : )

 

4.   Information Check-In Form

This is one of the provisions of the original bill that I didn’t care for.  A landlord will now be required to provide a standardized information check in sheet to each tenant that contains an itemized description of the premises.  The Substitute Amendment merely added that this form must be given to the tenant at the time of occupancy rather than at the time of signing of the rental agreement.

As I understand this law, this does not just mean that the landlord can give his new tenant a blank Information Check-In form to fill in — which many landlords are already doing.  Rather it means that the landlord must completely and thoroughly fill out the Information Check-In form to adequately describe the condition of the rental unit and give it to the tenant.  So if you are not thorough in your description of the renal unit this document could be used against you by the tenant, after the tenancy has ended.  This new provision of the law will clearly cause additional work for landlords and I fear could harm the less detail-oriented landlords out there when pursuing a tenant for damages to the unit or withholding portions of the tenant’s security deposit for damages.

 

5.   Holdover Damages Are Mandated

The new law requires that landlords be awarded holdover damages.  If a tenant stays in the rental unit beyond his tenancy, the landlord is now legally entitled to – at a minimum – double the daily rent for the time period after the tenancy ended (i.e. the notice expired) until the tenant actually vacates the unit.

This is a positive change because current law (sec. 704.27) only states that a landlord “may” be awarded holdover damages — and some courts would not award landlords these damages.  The new law says that a court “shall” award a landlord holdover damages, at a minimum.

 

6.   Withholding From A Tenant’s Security Deposit

The new law has merely codified the provision of ATCP 134.06(3), which states that a landlord is allowed to withhold the following from a tenant’s security deposit: (a) Tenant damage, waste or neglect of the premises, (b) Unpaid rent for which the tenant is legally responsible, (c) Payment which the tenant owes under the rental agreement for utility service provided by the landlord but not included in the rent, (d) Payment which the tenant owes for direct utility service provided by a government-owned utility, to the extent that the landlord becomes liable for the tenant’s nonpayment, (e) Unpaid mobile home parking fees which a local unit of government has assessed against the tenant to the extent that the landlord becomes liable for the tenant’s nonpayment, (f) Other reasons authorized in the Nonstandard Rental Provisions.

The new law also adopts the portions of ATCP 134.06 which state that a landlord cannot withhold from a tenant’s security deposit for normal “wear and tear” or other losses which the tenant cannot reasonably be held responsible.

 

7.   Timing For Return of Security Deposit

The original bill indicated that in situations where the tenant broke the lease prior to the end of the term that the landlord need not return the security deposit or provide an accounting of how the security deposit was applied until 21 days after the lease term ended or within 21 days of a new tenant taking occupancy.  This langauge is a substantial improvement over current law as it allows a landlord to hold the security deposit until he is able to determine if any future rent will owed by the breaching tenant if the landlord cannot locate a new tenant to re-rent the property to.  I explain this issue in more detail in my earlier post on the Landlord’s Omnibus Bill.

The Substitute Amendment waters this down a bit.  The new law will now codifies ATCP 134.06(2)(a) and states that a landlord shall deliver or mail to a tenant the security deposit or itemization of how the security deposit was applied within 21 days after any of the following: (a) if the tenant vacates on the last day of the rental agreement, the date on which the rental agreement terminates, (b) if the tenant vacates before the end of the rental agreement, then the date on which the rental agreement terminates or, if the unit is re-rented before the end of the rental agreement, then the date on which the new tenancy begins, (c) if the tenant vacates after the last day of the rental agreement, the date on which the landlord learns that the tenant vacated, (d) if the tenant was evicted, the date on which the writ was executed or the date that the landlord learns that the tenant vacated.

So the new law kept the good part of the original bill but by codifying ATCP 134.06(2)(a) the landlord must return a tenant’s security deposit or send out the itemization of how the security deposit was applied earlier than when the original bill stated in situations where the tenant was evicted.

 

8.   Disclosure of Code Violations

The original bill required that a landlord disclose to any prospective tenant any uncorrected building code or housing code violations prior to the signing of a rental agreement, accepting of a security deposit or accepting of earnest money.

The second Amendment to the Substitute Amendment modified the original bill and as a result the new law requires a landlord to disclose to a new tenant any uncorrected building code or housing code violations if the landlord has actual knowledge of the violation (rather than if the landlord had received notice of the violation from a housing code enforcement agency as under the original bill).

Specifically the new law requires the disclosure to the new tenant if the following four conditions are met: (a) landlord has actual knowledge of the violation, (b) the violation affects the rental unit or a common area, (c) the violation presents a significant threat to the tenant’s health or safety, (d) the violation has not been corrected.

 

9.   Request for Repairs

The orginal bill required that a tenant first notify a landlord in writing of any repair or maintenance issue, and then allow adequate time for the landlord to address the issue, before reporting the problem to the building inspector, elected official, or housing code enforement agency.  The Substitute Amendment removed this provision in its entirety so the law has not changed — tenants are allowed to call whomever they want to complain about maintenance issues without any requirement that they first notify the landlord of the problem.

 

10.   Acceptance of Past Due Rent

The new law states that if a landlord has filed an eviction against a tenant and the landlord accepts past due rent from the tenant during the course of the eviction, that the court cannot dismiss the eviction solely based on the landlord’s acceptance of past due rent from the tenant.

I really like this provision of the new law becasue currently, many tenants and their attorneys argue that if an eviction is pending and a landlord accepts past due rent from a tenant, that the landlord’s acceptance of that rent has effectively “waived” the landlord’s right to proceed with the eviction.

 

11.   Tenant Remedies

The Substitute Amendment added that any violation of chapter 704, including the provisions of the new bill, may constitute an unfair trade practice which may allow the tenant to sue a landlord for double damages and attorney’s fees.

I don’t like this new provision of the law for one simple reason.  I believe it will be used by tenants and tenant’s attorneys to seek double damages and attorney’s fees whenever a landlord allegedly violates any provision of chapter 704, whether the violation is a true unfair trade practice violation or not.  Only the provisions of ATCP 134, which will be codified in ch. 704 under this new law, deal with unfair trade practices.  Nonetheless, I anticipate that we will see some very creative arguments by tenant’s and their attorneys as to why a tenant should be awarded double damages and attorney’s fees for violations of chapter 704 that are not unfair trade practice violations.

 

Now we will have to wait and see how this new law “plays out” in the real world of landlording.  Some of the key things everyone will need to address before March 31, 2012, when the law takes effect are:

1.  Make sure any rental agreement you enter into with a tenant after March 31, 2012, does not contain any language that would be in violation of the “8th Deadly Sin” which essentially means eliminating or modifying any language similar to that found in the Crime-Free Lease Addendum.

2.   Make sure to add language in your rental agreement, and any renewal documents, stating that any property left behind by the tenant will be considered to be abandoned and will be disposed of by the landlord without any further notice to tenant (except for medical prescriptions and medical devices, mobile homes and titled vehicles).

3.   Rename your Check-In / Check Out Sheet as “Information Check-In Sheet” and insure that you provide any new tenants with a completed copy of the form thoroughly documenting the condition of the rental unit.

4.   Disclose any code violations that you have actual knowledge of that may present a significant threat to the tenant’s health or safety before entering into a rental agreement or accepting a security deposit or earnest money.

Good Luck Everyone

ADDITION:  3/21/12 – Make sure you read my 3/21/12 post about why I now think this new law will actually hurt landlords more than help them

 

ADDED 4/11/12 — Here is the link to the new law.

 

ADDED 4/11/12 – Here is a link to an article I recently authored on the new law.

ADDED 4/11/12 – Here is a link to the newly revised Wisconsin Statutes Chapter 704 re: Landlord and Tenant

 

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You Will Not Want To Miss AASEW’s Fourth Annual Landlord Boot Camp on Saturday Feb. 25th

Jan 3

Posted by Tristan R. Pettit, Esq. in AASEW, City of Milwaukee, Collections, Credit Checks, De Novo Hearings, Earnest Money, Emergency Assistance, Evictions, Execution of Writ, Fair Housing / Discrimination, Holdover Damages, Landlord Liability, Late Fees, Lead-Based Paint, Milwaukee County, Mitigation of Damages / Re-Renting, Notices, Pets, Property Management, Protected Classes, Reasonable Accomodations, Reasonable Modifications, Rejecting Rental Applicants, Rental Agreements, Rental Documents, Right of Entry, Roommates, Screening Tenants, Security Deposit, Self-Help Evictions, Seminars, Small Claims Court, Smoke Detectors, State of Wisconsin, Tenant Damage, Untenantability, Walkthroughs | 2 Comments

Landlording can be pretty complex, with a seemingly never ending myriad of paperwork, rules, landlord-tenant laws and simple mistakes that can cost you thousands of dollars.

The Apartment Association of Southeastern Wisconsin’s Fourth Annual “Landlord Boot Camp” can help you navigate these treacherous waters and teach you how to run your properties with greater profit and less hassles.

I have given similar landlord-tenant law seminars to fellow attorneys, landlords, and property manager organizations throughout the state for other state-wide semianr companies that charge attendees $300-$400.  This is your opportunity to learn all of the same information at a huge discount through the Apartment Association.

 

Who:   Taught by Attorney Tristan R. Pettit (who drafts the landlord tenant forms for Wisconsin Legal Blank)

When:    Saturday, February 25th, 2012. 8:30 am – 5 pm

Where:   Clarion Hotel 5311 S. Howell Avenue, Milwaukee [Map]

Included:  100 plus page manual/outline to help you put what you learn into practice plus helpful forms.

Cost:  $159 for AASEW members and $249 for non-members.  If you are not a member of AASEW but are a member of another landlord/apartment association the cost to attend will be $199.

Specials: Not a member?  Pay just a dollar more and enjoy a 2012 AASEW membership.

Wisconsin landlord-tenant laws are constantly changing.  To help keep you up to date we offer prior attendees a $50 discount.

Sign up by going to the AASEW’s Landlord Boot Camp landing page where you can sign up online and pay via PayPal.

 

What you will learn at the Apartment Association’s 2012 Landlord Boot Camp

Landlord Boot Camp covers everything that you need to know about residential Landlord Tenant law in Wisconsin, including:

  1. How to properly screen prospective tenants.
  2. How to draft written screening criteria to assist you in the selection process and protect you from discrimination complaints.
  3. How to comply with both federal and state Fair Housing laws including how to handle with “reasonable modifications”  and “reasonable accommodations” requests.
  4. How to legally reject an applicant.
  5. What rental documents you should be using and why.
  6. When you should be using a 5-day notice versus a 14-day notice, 28-day notice, or 30-day notice and how to properly serve the notice on your tenant.
  7. Everything you wanted to know (and probably even more than you wanted to know) about the Residential Rental Practices (ATCP 134) and how to avoid having to pay double damages to your tenant for breaching ATCP 134.
  8. When you are legally allowed to enter your tenant’s apartment.
  9. How to properly draft an eviction summons and complaint.
  10. What to do to keep the commissioner from dismissing your eviction suit.
  11. What you can legally deduct from a security deposit.
  12. How to properly draft a security deposit transmittal / 21 day letter.
  13. How to handle pet damage.
  14. What to do with a tenant’s abandoned property and how this may affect whether or not you file an eviction suit.
  15. How to pursue your ex-tenant for damages to your rental property and past due rent (and whether it is even worth it to do so).

. . .  and much more.  There will also be time for questions and answers.

You get all this for less than you would pay for an hour of an attorney’s time.

Last year’s AASEW Landlord Boot Camp was filled to capacity and we even had to turn a few people away.  So call early to reserve your spot.

Call the Association at (414) 276-7378, email membership@apartmentassoc.org or go to our Landlord Boot Camp landing page to sign up online and reserve your spot.

Remember that “landlording” is a business — so take the time to educate yourself on how to better manage your business and avoid costly errors!

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Landlords Should Treat Tenant Roommates As One Person To Better Understand Joint and Several Liability and Resolve Tenant Disputes

Sep 22

Posted by Tristan R. Pettit, Esq. in Collections, Joint & Several Liability, Rental Agreements, Roommates, Security Deposit | 6 Comments

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.

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