Landlord for Medical Marijuana Dispensary Done in by Its Lease

A case from the Alameda County Superior court in California gives us a fascinating lesson on a very basic issue: Rely on a “standard lease” at your peril. I bet the plaintiffs in that case, landlords who leased commercial property to a medical marijuana dispensary, are ruing the day they used a canned lease. They lost their case.

Here’s the background. Possession, use, and sale of marijuana is a federal offense; but in California, the Compassionate Use Act gives patients and their suppliers immunity from state prosecution if they adhere to the provisions of the Act. In the California case, the landlord signed a lease with the Harborside collective many years before, allowing it to operate a dispensary. In recent years, the United States Attorneys in California began targeting cooperatives, on the grounds that they were in fact selling marijuana to just about anyone (no one can seriously dispute the ease of obtaining a medical marijuana card). The prosecutors cleverly used the cooperatives’ landlords as their hammer: The feds sent letters to the property owners, threatening civil forfeiture of their property if they continued to allow it to be used to further a federal crime. Many landlords sent eviction notices to their tenants, as did the Harborside landlord, but Harborside refused to move and the landlord was forced to file an eviction lawsuit.

The landlord lost—the case was dismissed. The eviction was based on a section of California law that provides for terminating a lease when the tenant has used the property for an “unlawful purpose.” (California Code of Civil Procedure §1161(4).) The court concluded that “unlawful purpose” must be understood solely with respect to state law, not federal law. Because the collective had complied with the provisions of the Compassionate Use Act, its activity was not “unlawful” under state law and the eviction could not be upheld under that section of the law.

The Harborside decision emphasized that the landlord was not basing its eviction on a breach of a private right of the landlord under the lease—namely, a clause prohibiting the tenant from disobeying all applicable laws. Of course, the landlord could hardly advance such a claim, because its own lease detailed the tenant’s anticipated use of the premises (as a dispensary).

Good residential leases specify grounds for termination, and explain that tenants must obey all applicable laws. Failure to obey all applicable laws is a ground for termination that is separate than using the property “for an illegal purpose.” The Harborside court wisely didn’t venture an opinion as to whether the case would have turned out differently had the basis for the suit been “failure to obey all applicable laws,” beyond pointing out the possibly fatal hurdle for the landlord of trying to argue this theory when the landlord knew full well at the outset what the tenant was about to do.

I’m sure you’re wondering—even if the landlord had no advance knowledge of his tenant’s use of the property, is there really any difference between “using the property for an illegal purpose” and “failing to obey all applicable laws?” Isn’t the issue the same—whose laws? We won’t know until a court decides this question.

But in the meantime—isn’t there a better way for a landlord to protect itself? Yes, and this gets us back to the drawbacks of that canned lease. The parties could have simply omitted the use clause, or simply described a “retail use” instead of giving specifics. That would have avoided the problem of having the landlord seek to evict based on behavior that he specifically approved of in the lease. The landlord could have insisted on the right to evict based on a violation of any law, federal included, and that would have been that. Not the best position to be in, as far as the tenants are concerned, but tenants in weak bargaining positions often agree to harsh terms and hold their breath. Conversely, landlords desperate to rent out their space might cut corners by using a canned lease form and renting to tenants whose activities are counter to federal law. Perhaps that’s what happened here.

When You Pay “Last Month’s Rent,” Have You Paid It All?

When tenants move in, landlords often collect a security deposit of one month’s rent, plus last month’s rent. Imagine the tenant who, three years and two rent hikes later, has given notice and has no intention of writing a check for last month’s rent. The landlord will insist that the tenant pay the difference between the current monthly rent and the amount the tenant  paid when he moved in. Who’s right?

Here’s an example of a fight that could have been easily avoided. When the landlord raised the rent, she could have asked for the increase for the last month’s rent, too. It was up to the landlord to take that step, and since she didn’t, the tenant could argue that she waived her right to top off the last month’s rent.

Unfortunately for the tenant, it’s going to be very easy for the landlord to get that money anyway—she’ll deduct it from the  security deposit, and the tenant will have to challenge that deduction in small claims court to get it back. Expect the landlord to argue that “last month’s rent” should be understood as standing for the rent at the end of the tenancy, whatever that is. But if that’s so, it’s up to the landlord to make sure that the last month’s rent is current.

Giants’ Lincecum Leaves a Mess

Disputes over security deposits are unfortunately common, with spats over the difference between normal wear and tear (which landlords cannot charge tenants for) and damage—that’s the tenant’s responsibility. “How clean is clean” is a perennial debate. Some states, like California, specify that rentals need be returned only as clean as they were when the rental began; others require landlords and tenants to complete an inventory at the start of the tenancy, so there’s at least a chance that the rental’s initial condition will be documented.

When landlords and tenants can’t agree on proposed deductions, the matter often ends up in court, with tenants suing for the return of their deposit. Landlords who face clean-up and replacement costs that exceed the deposit may file their own lawsuits for the balance. Because the amounts involved are rarely more than a few thousand dollars, the cases go to small claims court, where litigants are limited as to how much they can sue for.

Small claims won’t do for the San Francisco landlord who rented a furnished apartment to Giants’ pitcher Tim Lincecum last year. She’s suing the ace for losses due to damaged and stolen furnishings and property, describing destroyed “bedding, doors, carpet, pillows, kitchenware, linens, furniture, household appliances, art work, decorations, patio furniture, lights, lamps, and mirrors.” The owner claims that although the lease ended on March 1, 2011, Lincecum stayed on without paying rent through mid-May, racking up unpaid rent. The total claim: a whopping $350,000.

The landlord has a lawyer; Lincecum will doubtless lawyer-up soon. If the landlord has physical evidence to substantiate her claims, especially photos, it’s hard to imagine how her tenant will evade responsibility; and proving unpaid rent is simply a matter of showing residence plus no check.

Because going to trial will be pointless, this case should and doubtless will settle, unless the landlord’s figures are so inflated that Lincecum thinks he can defeat the claims on account of greed. That, however, would still involve the spectacle of a trial, with his private life and manners up for public scrutiny. I doubt he’d relish that.

What’s the lesson for the rest of us landlords & tenants? First, as soon as the lease expires but the tenant stays on, landlords should begin eviction proceedings. Even in tenant-friendly San Francisco, these cases move quickly when the tenant alleges no defense (such as, in a nonpayment eviction, a justifiable withholding of rent when landlords fail to maintain the property). A quick trip through the courts would probably have happened here—there’s no suggestion that Lincecum had a right to stay past the lease ending date.

The take-away for tenants is easier: To avoid being charged for pre-existing damage, be sure to inventory the condition of the rental at the outset (do a walk-through with your landlord, and have both of you sign-off on what you find). And obviously, if you damage something, pay for it.

No Harm, No Foul: Challenge to San Francisco’s Rent Control Ordinance Gets Tossed

In November of 2008, San Francisco voters passed Proposition M, which amended the City’s rent control ordinance by, among other things, making it illegal for landlords to try to get tenants to move out by offering them money, accompanied by threats or intimidation. A landlord’s association, joined by one landlord, sued the city in federal court, seeking to stop enforcement of the law by arguing in part that the measure restricted their free speech rights and failed to adequately describe the conduct that would be illegal. The trial court ruled in favor of the City; the association and landlord appealed to the Ninth Circuit Court of Appeals. The result: Victory for the City. The court dismissed the suit and even refused to give the association a second chance to get their complaint right. (Carrico et al v. City and County of San Francisco, 2011 DJDAR 13612.)

What’s the Problem?

Like many other rent control ordinances, the San Francisco law prohibits tenancy terminations unless they are based on one of the law’s enumerated “just causes,” or allowable reasons. These reasons include failure to pay rent, excessive damage, the owner’s need to move in, and so on. Just cause eviction protections are necessary in order to prevent landlords from terminating a tenancy in order to create a vacancy—and bumping the rent to market rates for the next tenant. Without just cause rules, the purpose of rent control could be easily avoided by landlord-initiated, constant tenant turnover.

Predictably, landlords saddled with long-term tenants or problematic tenants have looked for ways to oust these residents when none of the just cause reasons apply. Some landlords approach the problem in a business-like manner, offering buyouts that often amount to many thousands of dollars. Others use additional tactics, by threatening service cutbacks and lawsuits, or simply making life miserable, if the tenant won’t take the deal. Proposition M was intended to make such bad faith conduct a violation of the city’s ordinance.

The Landlords’ Complaint

The landlords’ association and the single landlord attacked Prop M on several fronts, most notably by arguing that it attempted to regulate their freedom of speech, and was unconstitutionally vague. The freedom of speech argument was tough—the ordinance regulated commercial speech, which enjoys less protection than speech that’s not connected with business. To pass muster, the City needed only show that it has a substantial interest in regulating the behavior at hand, and that the ordinance “materially advances” that interest in the narrowest manner possible. In short, the issue has to be really important, and scalpels, not sledge-hammers, are what’s needed. The trial judge sided with the City.

The second question of vagueness was also a loser for the landlords. The judge ruled that “bad faith” is a concept that’s generally understood and applied (many laws proscribe bad faith conduct, and they’re not overturned for that reason). Similarly, “threats,” “intimidation,” and “offers of payment” are understandable to a person of ordinary intelligence. The case was dismissed.

Adding Insult to Injury: This Case Should Never Have Been Allowed to Proceed

Appellate courts usually review the lower court’s decision, apply the law, and decide whether it was correct. They usually don’t bring up new arguments. But there’s one area of law that’s always fair game for discussion: Did the plaintiffs—the people bringing the lawsuit, in this case, the association and the single landlord—have the right to bring the lawsuit in the first place? This issue is known as “standing,” and it simply means that only those who have suffered actual or imminent harm as a result of the law can bring a lawsuit challenging it. Merely being subject to a law, and even feeling “chilled” by it, are not enough to confer standing.

Importantly, you don’t have to violate the law in order to have “suffered injury.” But if you haven’t violated the law yet, you do have to convince the judge that you’re about to, and that you’ll be harmed as a result. Here is where the landlords’ case fell apart—to show that they were about to be harmed by Prop M would have required the landlords to state that they intended to engage in rather unsavory behavior, and just needed to know “how much is too much.” They didn’t go there—but that was a fatal mistake.

The appellate court concluded that this failure to show actual or imminent harm should have doomed the case from the start. They vacated the lower court’s decision, and sent it back with instructions to dismiss it for lack of standing.

The Court Shouts

When cases fall apart, courts often give the parties a second chance to get it right. Complaints can be amended; cases can be dismissed “without prejudice,” which makes it possible to try again. Not here: The court’s decision ends with a remarkable, all-caps instruction: “VACATE AND REMAND WITH INSTRUCTIONS TO DISMISS FOR LACK OF JURISDICTION.” Ouch.

Who Has Benefited from Challenges to  Prop M?

Other challenges to Prop M have resulted in landlord victories. The proposition attempted to prohibit landlords from making repeated buy-out offers after the tenant has notified the landlord in writing that the tenant is no longer interested. A California state appellate court earlier invalidated that portion. Another section would have given San Francisco’s rent board the power to reduce rental payments to landlords who harass their tenants or coerce them to leave—that too was tossed, another win for landlords. (Larson v. City and County of San Francisco, 192 Cal.App.4th 1263 (2011).)

Standing Gets Its Day in Court

The question of standing—having the right to complain about a law—is also at the heart of the current legal tangle over Proposition 8, California’s anti-gay marriage law. In the same week that the rent control ordinance was issued, the California Supreme Court heard arguments on whether the backers of the proposition had standing to defend it in court (the state would normally defend a successful initiative, but both the governor and the attorney general refused to do so). Stay tuned for the results on that one.

The New York Times’ Ethicist Should Start with the Law

Skimming...OK for the beach, not for landlords

In the Sunday, June 19, 2011 edition of the New York Times Magazine, “The Ethicist” responded to a California reader’s question about his landlord’s behavior. The reader, a poor student, had rented a room in a house, “with plans to stay for a full year,” but the owner soon told him that he would stop paying the mortgage. A few months later, the house was sold and the new owner gave the student 30 days to move out. The student was irked at the thought that he’d been paying rent while the owner had not been paying his mortgage, and asked if, in this situation, it would have been ethical to withhold his rent.
Citing the student’s statement that “no formal lease was signed,” the Ethicist concluded that the student had “no guarantee of a full year’s stay.” She then addressed what she viewed as the ethical question, concluding that because the renter and owner had no specific understanding that the rent would be due only if the mortgage had been paid, the student “wouldn’t have had much of a case for freeloading. [The owner’s] dereliction could not have justified yours.” Both conclusions are legally wrong, and there’s really no need to even get to the ethics of the matter.

 

“No formal lease was signed”

Both the Ethicist and the student seemed to be assuming that to be enforceable, a year’s lese has to be “formal” and “signed.” This is not true. The term “formal” has no legal meaning. An oral lease is legal and enforceable for up to one year. If the owner knew of the student’s plans and agreed to them, or remained silent after hearing of the student’s assumption that the deal was for a year, they had a lease, period. True, it may be harder to prove that the parties intended the rental term to run for a year, but difficulty in proving what was agreed to is not the same as saying that the oral understanding, once the judge decides what was agreed to, cannot be enforced.

What good would it have done for the student to be able to prove he had a lease? Read on, the answer is below.

“He doesn’t pay the mortgage, but I pay the rent!?”

Next, the Ethicist concludes that the owner’s failure to pay the mortgage would not excuse the tenant’s obligation to pay rent. This is also not exactly true—if the landlord was “rent skimming,” the student may have been able to recoup that rent after the fact.

Rent skimming means using rent proceeds from residential property during the first year (or more) of owning the property without first applying that revenue to payments due on a mortgage or deed of trust. As you might imagine, the purpose is to protect the interest of the bank and the seller. States vary in the length of time that rent skimming prohibitions apply (in California, surprisingly, it’s only one year following purchase of the property). (Calif. Civil Code § 890 and following.)

When a tenant is injured by a purchasing landlord’s rent skimming, states typically provide for very specific remedies. California tenants who must leave their rentals prematurely due to a foreclosure sale resulting from rent skimming can sue for their actual damages, including their lost security deposit and moving expenses. If the landlord’s behavior was particularly outrageous, judges can award exemplary, or punitive damages, meant to punish such behavior. And they must award punitive damages if the landlord was already two or more months behind in his payments at the time the tenant rented the premises. In addition, multiple acts of rent skimming are criminal offenses.

There are some defenses to rent skimming. For example, depending on state law, a landlord can escape liability if he used the rental revenue to pay health care providers for necessary and unforeseen treatment of himself or his dependents, or if he used it to pay contractors to make the rental premises fit and habitable. California requires that these payments be made within 30 days of receiving the rent, and that the landlord had no other source of funds to make his payments.

About that Lease

Now then, assuming the tenant could have proved that he had a lease, how would that have helped him? It might have come in handy if he had pursued his rent skimming options. As a lease-holding tenant, the student could have argued that he had no alternative but to continue to honor his lease, although he suspected rent skimming. Even if he had been able to prove that the landlord skimmed, he could not have ended his lease on that basis–skimming does not constitute a breach by the landlord, enabling the tenant to walk away.

On the other hand, as a month-to-month tenant, which the Ethicist thought he was, the tenant could have given 30 days’ notice and ended the tenancy. Although staying on doesn’t destroy his right to seek rent skimming damages, it casts a bit of a shadow on his plea. Might he have stayed on in order to eventually sue the landlord? Probably not likely, but it’s always better, when claiming that someone did you wrong, to be able to show that you had no choice but to endure the situation.

“Cellphone rapist” and the Landlord’s Liability

The June 7, 2011 burglary and rape of a tenant in Oakland, California, filmed on the victim’s cellphone, bears many unfortunate resemblances to a common scenario: The criminal enters the home through a vulnerable door or window and assaults the resident. When it’s a homeowner who is assaulted, the question of responsibility for that easily breached door or window stops with the owner. Unless windows or doors were structurally unsound or installed improperly, a homeowner has only himself to blame for living with flimsy or broken items that facilitated the intruder’s access.

Not so when the home is rented. Landlords began learning in the mid-1990s that sloppiness with tenant security could lead to hefty judgments and insurance settlements. Texas was the first to pass a statewide law mandating locks and key control. Called the Texas Security Devices Act, it forced landlords to secure their premises.

California has similar codes and requirements. California Civil Code Section 1941.3 requires locks on specified doors and windows, and mandates deadbolts for exterior doors. Section 1941.1 requires doors and windows to be unbroken. Importantly, landlords’ obligations go beyond “the letter of the law”—in crime-plagued neighborhoods, especially for properties that have been the subject of criminal activities already, landlords must take reasonable steps to protect their tenants, a duty that goes beyond strict compliance with the codes. When landlords fail to follow the law, tenants may move out, withhold rent, and use repair-and-deduct to fix the problem themselves.

But when landlords fail to follow the law and a tenant is assaulted, the consequence to the landlord can be more serious than a case of rent withholding. If tenants can show that the landlord knew of the code violation or unreasonably insecure situation, that he failed to address it despite having a reasonable amount of time to do so, and that the assailant gained entry by means of the substandard door or window, the landlord may end up being partially responsible for the tenant’s injuries and losses.

The tenant who was assaulted in the Oakland case will have this standard to meet should she sue her landlord. Although she complained repeatedly to the landlord about conditions at the rental, according to the Bay Citizen, it’s not clear that she included the back door. So far, her description to SF Gate (“The door that [the assailant broke] was so flimsy I didn’t even hear the sound of it being kicked in….”) doesn’t establish that it lacked the legal requirements of an exterior door.

This tenant’s use of her phone camera to record the break-in was the result of thinking that the intruder was in fact a repairman, yet another in a long line of repairpersons who had been entering her home without notice, in violation of California law. Her landlord’s flagrant violation of California’s privacy statute is inexcusable, and no doubt it fans the public’s outrage. But the landlord’s callous disregard of tenant privacy, though exposing him to penalties for those violations, will not result in making him partially responsible for the break-in.

Screening Tenants, Even the French

 

Readers are doubtless familiar with the arrest of the head of the International Monetary Fund, Dominique Strauss-Kahn, for sexual assault on a housekeeper in a Manhattan hotel. Initially denied bail, Mr. Strauss-Kahn was eventually released on $1 million cash bail, with the condition that he be subject to house arrest. Because DSK, as he’s called in France, doesn’t have a house in the United States, he had to find one. He was about to become a renter.

DSK’s wife initially approached the Bristol Plaza, a very ritzy abode comprised of long-term rentals and “extended stay” guests—those who stay more than 30 days. The amenities are grand (“Daily maid service with fresh towels and quality linens!”). The price is steep (reported to be $13,000 per month for an apartment), but no matter—with a lease apparently in hand, the legal team headed confidently to court, prepared to spring their man to the Plaza. But unfortunately for DSK, the building’s residents were unwelcoming. The prospect of round-the-clock security details and swarming media hoards brought them out in force, complaining to the management. The deal was off.

So what happened here, and what lesson can less glamorous landlords take from this episode? Consider the very telling report in the New York Times:

“Mr. Taylor, one of Mr. Strauss-Kahn’s lawyers, said Mr. Strauss-Kahn could have insisted on staying in the Bristol Plaza, but his family decided to withdraw out of courtesy for tenants and the landlord, who he said had raised objections. (A spokesman for Howard Milstein, the chairman of Milstein Properties, which controls the building, said, “Howard is on the West Coast and not aware of this.)”

So it seems that a rental agreement was signed. How can it be that this landlord failed to appreciate the circumstances of the tenancy that it was about to create? Landlords in any state would be on solid ground to refuse to allow their properties to be turned into a private jail, even if the detainee isn’t notorious. The decision is especially curious when one realizes that the same hotel refused to house Bernard Madoff, another house-detainee, for fear of the same media circus and upset tenants. But sign it they did—and Howard, the man at the top, was on the West Coast, blissfully unaware.

Had DSK’s lawyers decided to insist on the deal, the Bristol might have had a hard time getting out from under this rental agreement. To legally void the contract, they’d need to show that they were misled, but management knew the circumstances (DSK’s wife rented two apartments, the second for use by the security detail), so they can hardly claim ignorance of the special arrangements surrounding this tenancy. DSK has enough legal troubles; he hardly needed a fight over a lease contract, so letting it go was clearly the smart thing to do. But a lesser luminary, disappointed at the loss of a fine place to stay, might have dug in. In exchange for agreeing to not move in, such a tenant might have insisted, for example, on the “benefit of his bargain”—the monetary value of the lost accommodations in case he was not able to procure similar digs.

Landlords, take note: Screen well, anticipate problem tenants and avoid them, and keep tabs on what’s happening at your properties.

Bedbugs: Maybe More Than Just Annoying

They come out at night to gorge on human blood, but can last a year between meals. A single female will lay 500 eggs in her lifetime. You’ll find them in sleazy digs with slobby tenants, as well as upscale apartments with conscientious landlords and fastidious residents. They’re expert hitchhikers who can catch a ride on your suitcase or clothing. No one really knows how to kill them. What are they? They’re 21st century bedbugs, and if they show up at your rental property or in your apartment, you’ll probably conclude that mold, asbestos, or even lead-based paint are benign by comparison.

Until a few days ago, it’s been reassuring to know that, unlike lead-based paint, asbestos, and some molds, bedbugs do not seriously harm your health. For sure, their bites are maddening and unsightly, and dealing with them will disrupt your life (or your landlording business) in a major way. And the psychological effects of living with bedbugs can be difficult. But you aren’t likely to get seriously sick. The Centers for Disease Control still tell us, “Bed bugs, a problem worldwide, are resurging, causing property loss, expense, and inconvenience. The good news is that bed bugs do not transmit disease. The best way to prevent bed bugs is regular inspection for signs of an infestation.”

Maybe not. In an advance electronic publication of an article slated to be published in Emerging Infections Diseases, researchers in Vancouver reported the discovery of particularly nasty bacterium on bedbugs who were taken from patients admitted to an inner-city hospital. The bugs were carrying methicillin-resistant Staphylococcus aureus (MRSA) and vancomycin-resistant Enterococcus faecium (VRE). These bacterium cause serious staph infections that are very resistant to antibiotics.

The study’s authors concluded that they may have discovered a new pathway, or vector, for the transmission of these bacterium. Much like the mosquito carries malaria, perhaps the bedbug carries the bacteria, dropping it off as it bites its human host. However, further study is needed to determine whether the bugs are simple transmitters, or have the staph infection themselves; and even whether the bugs infected the humans, or the other way around. The researchers also noted that their findings occurred in an area of dense, poor housing, whose residents already had a high incidence of MRSA infections.

The implications of this study for landlords and tenants are significant. A widespread bedbug infestation qualifies as a habitability problem, which, if not addressed, will enable tenants in many states to break their leases and leave without liability for future rent, or withhold rent until the problem is fixed, or take steps to deal with it themselves and deduct the cost from the rent.

But if bedbugs are proven to be vectors for staph infections on the order of MRSA, the implications for landlords and tenants are dramatic. Tenants may be facing more than annoyance and disruption when dealing with the bugs. Landlords who fail to respond to an infestation or utilize ineffective treatments risk exposing their tenants to a devastating infection. Sickened tenants would have a lot more to sue over than just the value of their ruined belongings or the cost of having to move.

Landlord “Fines” Guests for Smoking, Plus a Lesson Learned

I write a nationally-syndicated newspaper and website column, Rent It Right, in which I answer questions from landlords and tenants. For almost three years now, I’ve been writing about controversial topics like breaking a lease, who pays for bedbug eradication, and rent control. But no subject—even renting to registered sex offenders—has generated as many responses as did a recent column on a vacation rental landlord’s practice of “fining” guests $300 when they smoke in her no-smoking unit. The renters’ adult children had smoked while the parents were away one evening and “you could smell the smoke.”

My answer, which was legally correct, pointed out that “fines” are generally illegal in consumer contracts because they’re really a liquidated damages provision. Liquidated damages are allowed only in situations when it would be very hard to measure the consequences of misbehavior, and both parties to the contract specifically agree beforehand that this is so. Often, liquidated damages clauses must contain specific language in order to be enforceable. On the assumption that this rental contract had no such language, I wrote that the tenant stood a good chance of prevailing if he refused to pay it and had to defend himself in court.

Well. Several people begged to differ. No one challenged the legal analysis, but the writers (passionate non-smokers all) told me that paying $300 for breaking the smoking rule was actually a windfall for these tenants. The writers assumed that the smoke had permeated the furnishings and carpets to the extent that deep steam cleaning throughout would be needed. Arranging for and performing this type of cleaning would cost several hundred dollars or more, and would likely take the unit off the market, depriving the owner of future rents. In addition, some advised me that if the landlord didn’t do a thorough job, and subsequently rented to non-smokers, many such tenants would refuse to take the rental, resulting in more lost rent and damage to the landlord’s reputation. These writers advised me that having to pay only $300 was a good deal, and that rules-breaking renters should shut up and count themselves lucky. The final cut, however, was unjustified—practically everyone assumed I was a smoker, and “on their side.” Nope, never smoked.

But personal accusations aside, my correspondents’ points are all well taken. It’s a good lesson: Sometimes it pays to stop and think of the practical consequences of standing upon the letter of the law. But I’m not sure what the best advice is for owners who want to be compensated for smoke residue. If the tenants know the law and challenge the “fine,” they will likely win, and a judge may not allow the landlord to turn around and sue for actual—and higher—damages. Knowing this, landlords may decide to use a liquidated damages clause and hope that they’ll be dealing with tenants who either won’t know the law or who will willingly pay the amount. Three-hundred dollars might suffice when the smoking was minimal, but if the residue is extensive, it would not cover the real cost of removing it. But over the long run, hoping to collect $300 from all rules-breakers may be more cost-effective than individually suing tenants when the real cost of cleaning is higher.

Hopefully, the crow will be delicious.

 

Ohio Landlord’s Good Deed Turns Deadly

Ohio landlord Steven Snow had known the family for 20 years. Tammy McDaniel and her three kids needed a place to stay after Tammy’s break-up with her boyfriend; Steven had a vacant rental home that he was fixing up. Steven says that Tammy was at the house waiting for the electricity to be turned on; he lent her a generator to warm the place temporarily. But she stayed the night with her kids, and in the morning, Steven found all of them dead of carbon monoxide poisoning. The house did not have a carbon monoxide detector; Steven has been charged with four counts of reckless homicide.

Reckless homicide is the killing of another person by acting, according to Black’s Law Dictionary, “with conscious indifference toward that person’s life.” On either side of reckless homicide sit murder (which requires an intent to kill), and negligent homicide (death caused by careless acts, otherwise known as an accident and not a criminal offense).

Contacted to comment on the situation, a spokesman for the National Apartment Association, a lobbying group that represents about 50,000 apartment companies, referred to the increasing number of states and cities that require carbon monoxide detectors in multifamily rentals (Ohio is not among them). Landlords are concerned, the spokesman claimed, that they might be held liable for injuries or deaths that result from CO poisoning if a tenant had removed batteries or failed to notify a landlord of a malfunctioning device.

It’s unfortunate that the National Apartment Association used this tragedy to air their constituents’ worries about installing detectors in general, rather than focusing on what appears to have happened here. CO poisoning results from the unvented burning of fossil fuels, including gasoline. Running a generator inside a house is really no different than running a car in a closed garage. It’s hard to imagine how this escaped the landlord’s attention; even his intention to use the generator temporarily exposed the family to deadly fumes.

The spokesman’s stated fears–that tenants who remove batteries or fail to report broken monitors will still be able to hold landlords liable–are not relevant here. Death involving a disabled or malfunctioning device is not what happened at Steven Snow’s house. Mr. Snow is charged with recklessly placing a CO source in an unvented place, where he knew people would be.

Landlords can’t prevent tenants from foolishly removing batteries, or from failing to ask for repairs or replacements; nor can they inspect rental premises constantly. For these reasons, when landlords follow the law and install monitors as required, they will usually escape liability if the tenant disables the unit or carelessly fails to report a problem.

Requiring CO monitors in Ohio and other states that do not yet do so is a common sense move, akin to the widespread mandate for smoke detectors. We know these devices save lives; we also know that tenants who install them on their own risk deductions from their security deposits for “damage” to the walls or ceilings. Having to pay for installing a widely acknowledged safety device is not something we should expect of tenants. Landlords who fear that tenant sloppiness or meddling will make them liable for subsequent injuries or deaths need to be reassured by their lobbying group that this is not likely to happen.