As a landlord, can you be held liable for the actions of your tenants?
Lawyers will agree — you can be held liable for the inappropriate behavior of whomever you may rent your property to.
Common sense would tell you that your tenants are responsible for their own behavior — after all, they’re adults and they know that actions have consequences — and for the most part, that’s true.
For example, if a neighbor calls the police on your tenant for disturbing the peace, your tenant may be punished with a warning or a fine (in most cases) or even get arrested and go to prison (in extreme cases). But if a problem like this repeats itself and you, as the landlord, do not do anything about it, the neighbors may ultimately take you to court and demand compensation from you. This is because you, as the owner of the rental property, have control over who lives in it. The court will not accept an explanation like “but I live off-site and have no influence on the tenant’s behavior”.
Take a walk in the neighbors’ shoes
Why would neighbors even think to sue the landlord rather than the tenant?
… probably because they tried every other reasonable method to resolve their problems and they are left with no other option.
Imagine if you have to deal with the inappropriate (or even illegal) behavior, noises, smells, littering or destruction of common property (e.g. a common stairwell) caused by a neighbor. Say, for example, they are party animals and they don’t care that you or anyone else may have to go to work the next morning. Day after day you can’t get any sleep and your home and professional life suffers…
If your attempts to talk to the neighbors and even intervention from the police does not ultimately stop them from doing inappropriate things, then you could feel totally powerless.
If your neighbor’s landlord also didn’t want to do anything about it, you yourself might come to the conclusion that suing the landlord isn’t a bad idea.
A court can order the tenant to be removed from the property. It can require you to pay compensation to the neighbors, and in the worst cases, the government could even confiscate your property.
Therefore, complaints from neighbors should under no circumstances be taken lightly. But don’t worry, you will likely have plenty of warning signs before you actually get sued. Here are some ways to handle the situation before things get bad.
How should you respond to problems reported by neighbors?
Remember, even the most mistreated neighbors usually won’t go to court right away. First, they will try to talk to the nuisance tenant and/or complain to you (the owner) about them. They might also call the police.
Regardless of how you hear the complaint, you should not ignore it.
When dealing with this situation, also keep in mind that it might be in your best interest to take your neighbors’ side of the argument, because while your tenant will likely be a temporary part of your life, your neighbors will probably be around for as long as you own the property.
Here’s a very basic and general outline of the steps you can take:
- Talk to tenants — In many cases, your tenants may just be oblivious to the fact that they are causing a disturbance. They may not realize they’re being too loud, or to them it’s normal. In these situations, a firm but friendly warning can make everything right.
- Inform them in writing — a reminder sent online via a letter in the mail is evidence that you attempted to solve the problem. If you do end up in court (heaven forbid), you will have hard evidence that you did not ignore the problem. Do not underestimate the risk of being sued. It is not unheard of for landlords to have to pay damages in the mid to high 5 figures. It might even be safe to say that these occurrences are on the rise!
- Termination of the tenancy agreement — if a nuisance tenant just does not want to change their ways, even if they always pay their rent on time and in full, you can (and probably should) evict them. This is a last resort, and you should obviously only evict a tenant if you absolutely need to. You will need to have plenty of evidence that the tenant disturbs the peace, such such as police reports from neighbors and police officers’ notes from their interventions.