Landlords can reduce the chance of being sued by their tenants if they take certain precautions. Below is a list of four common lawsuits against landlords and advice for preventing or mitigating such lawsuits.
1. Slip and Falls Lawsuits
Now matter how careful a landlord may be in maintaining their properties, a tenant, guest, or customer may slip and fall at the landlord’s property and sustain an injury. Even if not the fault of the landlord, an aggressive lawyer could attempt to file a lawsuit asserting that the landlord was responsible in some shape or form.
There are several ways landlords can mitigate their damages from any slip and fall lawsuit. First, holding the real estate in a limited liability company will protect member’s personal assets. If the LLC is the owner of the property, the LLC is the proper named defendant – not any individual members. This serves to protect the member’s individual assets if there is any such lawsuit and possible judgment.
Second, make sure to maintain proper insurance coverage. This way, if the landlord is sued, insurance coverage will pay for the cost of an attorney to defend the lawsuit and provide coverage for any settlement or judgment. This is a significant protection since legal defense can become costly. Be sure to review any exceptions from coverage with counsel to make sure there are no surprises if you need to make a claim. For example, exceptions that exclude certain types of injuries or accidents may be a reason to choose another insurance carrier.
Accordingly, LLCs and proper insurance coverage are ways landlords can mitigate their damages if they are sued for a slip and fall lawsuit.
2. Failing to Perform Maintenance and Repairs
If a landlord fails to perform its maintenance and repair obligations under the lease, this could result in a tenant filing a lawsuit against the landlord or withholding rent. Therefore, it is essential for any landlord to timely and properly perform such repairs without delay. It is also a good idea to include a provision in the lease that allows the landlord to make any repairs that tenant is responsible for if the tenant fails to make such repairs and charge the tenant for such repair. This will allow landlords to prevent a small problem from turning into a much larger problem. Hiring a competent management company may be a good option for landlords to delegate maintaining their properties to professionals experienced in property management.
3. Failing to Timely Return Security Deposit
Many landlords do not realize that there is statutory timeframe that the landlord must either (i) return the security deposit; or (ii) provide an itemization of the repairs deducted from the deposit with the remainder of the deposit (if any). The landlord has 30 days after lease termination (or 15 days from written notice of tenant’s forwarding address, whichever later) to send the security deposit and/or itemization of damages. If the landlord does not comply with this time frame, a tenant can sue for double the damages of the original security deposit. Therefore, it is important to timely return the deposit or provide an itemization of the deductions for damage to the property.
4. Improper Entry
Under what circumstances a landlord has the right to enter the tenant’s leased space can become a point of contention. By statute, the Landlord is permitted to enter in the event of an emergency, which is typically fire, flood, or other dangerous condition. However, if the landlord wants to reserve the right to enter to make repairs, inspect, or show the property to perspective tenants and buyers, it is a good idea to clearly spell this out in the lease. This will mitigate the potential for a legal dispute in the future.