More and more of my clients are becoming landlords as they try to stop the financial bleeding by renting houses that won’t sell and office space left vacant because business is down. Although rental income often justifies the added responsibilities and headaches of being a landlord, it’s important to handle tenants properly so that you can kick them out immediately if they become delinquent in paying their rent. This post explains how mishandling a delinquent tenant can inadvertently create a “tenancy at will” that allows him to delay the eviction process by 60 days.
The typical eviction process works quickly, like this: Tenant fails to pay rent when due. Landlord sends a notice of nonpayment or demand for payment required by the lease. When tenant fails to pay overdue rent, landlord declares tenant in default and immediately files a dispossessory action in court, which then issues a writ of possession that allows landlord to evict tenant immediately. In this typical scenario, the delinquent tenant is a “tenant at sufferance” because he occupies the rented premises without the landlord’s permission.
A landlord can throw a wrench into the works, however, if she takes any action which suggests that the delinquent tenant has permission to remain on the premises. Permission from the landlord changes the tenant’s status from a “tenant at sufferance” to a “tenant at will.” This matters because a “tenant at will” has a statutory right to receive 60 days’ notice from a landlord, before a landlord can evict him. Unfortunately for the landlord, this 60-day notice period applies even if the tenant is already behind on rent when the landlord gives the required notice, meaning the tenant will likely get two more months of free rent.
Although courts have not offered much guidance about exactly what acts by a landlord will convert a “tenancy at sufferance” into a “tenancy at will,” courts have made clear that it takes very little to convert a tenancy. Furthermore, cases show that a landlord can create a “tenancy at will” either expressly, through written or oral statements giving a tenant permission to be on the premises, or implicitly, through acts that merely imply that permission. Even a landlord’s acceptance of rent from a delinquent tenant can be seen as implicit permission to remain on the premises that creates a “tenancy at will,” such as where a landlord accepts rent from a delinquent tenant before filing a dispossessory action. (Cases indicate that, in most instances, a landlord can accept rent from a tenant after the filing of a dispossessory action, without creating a “tenancy at will.”)
The upshot of this is that a landlord must be very careful when interacting with a delinquent tenant, especially in regard to accepting payments or making concessions about the amount of rent owed. Because courts require little evidence to convert a tenancy into a “tenancy at will,” a savvy tenant can easily set a trap for an unwary landlord through communications which imply that the tenant has permission to remain on the premises. Even if such evidence is questionable, the mere possibility that a delinquent tenant can prove a “tenancy at will” in court can give the tenant substantial leverage in negotiating an exit plan with his landlord.
One recommended way to deal with any uncertainties surrounding delinquent tenants is immediately to file a dispossessory action and then attempt to negotiate a surrender of the premises with the tenant, as part of the dispossessory action. Any agreement reached will become the court’s order that resolves a dispossessory action. Such an order can be enforced by the court; it gives both landlord and tenant the ability to plan around a negotiated eviction date; and it allows the landlord to obtain a court ruling that the tenant is a “tenant at sufferance” and not a “tenant at will,” regardless of any payments to be made by the tenant or any concessions granted by the landlord.