landlord/tenant Q&A

LURLINE R. JOHNSON (R), ABR, CRB, CRS, GRI, RMP
Property Manager
Property Profi les, Inc.
Past President, Oahu Chapter
National Association of Residential Property Managers

After our Property Management Seminar we had a lot of short questions that went unanswered due to time constraints. We will dedicate the next few weeks to provide answers to those questions.

Q. Do we have to give a reason to the tenant why we are not renewing the lease?

A. Whether the tenant is on a fixed term lease or a month-to-month contract, you don’t have to give a reason why you are terminating the lease. You just let them know that you are either terminating the lease at the end of the term or giving a 45-day notice to end the contract.

Q. Do we have to evict? Can we just terminate their lease?

If they are on month to month and give 45 days’ notice?

A. You never have to evict but you may need to if the tenant doesn’t leave the property when asked. The process is that you give them a 5-day notice to pay or vacate – this is a 5-business day notice as opposed to calendar days.

Here is the scenario: Your tenant is late in making their payment. You have a 3-day grace period to pay the rent – so it is due on the 4th day of the month by 5 pm. Now that the payment hasn’t been received you give them their notice on the 5th day of the month. The fifth day is a Saturday and Monday is a holiday, so you can’t give you 5-day notice until Tuesday – which is the 8th of the month. You now have Tuesday, Wednesday, Thursday and Friday – which is 4 of the 5 days – 5th business day is now the 14th day of the month. You have lost half the month just giving notice to make the payment. At this time, you can start the eviction process. If you decide to just ask them to leave and hope that they do, you may be looking at least 30 days of no rent before they move out. They will need to find an alternative rental – and that could take them a few weeks to accomplish.

You need to make a business decision as to how long of a grace period you are willing to give your tenant – or none at all. You also must decide if you will go for an eviction once the correct notices are given or if you will just encourage the delinquent tenant to move out and hope that they do.

Q. Can you evict and file in court for the owner as a property manager or does it require the owner to file in court?

A. A property manager – as agent for the owner – can indeed file for the owner in court but will they want to? Will the property manager – who may not have had experience in small claims court – be able to have all the correct documentation and where-withal to be successful in court? How would the owner fare in this same situation? Is it a better business decision to hire an attorney who specializes in evictions to work on your behalf? Of course, the attorney comes with a price tag but the experience and ability they bring to the table may be what it takes to solve the situation. Again, this is a business decision that the owner of the property will need to make.

Q. Is the security deposit returned (if no balance owed by tenant) if tenant is evicted for illegal activity?

A. The security deposit is a fully refundable deposit. If the tenant doesn’t owe for any cleaning, damage, replacement of keys, etc., then the fact that they are evicted for some form of illegal activity doesn’t allow the property manager (or owner) to retain any portion of the security deposit.

If it is determined that property manager illegally retained any portion of the security deposit, then the Landlord Tenant Code states, in Section 44(h)(1)(2)(3) & (4) that: Legal action involving security deposit disputes may be undertaken by either party only in small claims court. In this type of small claims court action, lawyers are not allowed to represent either party. Where the court determines that the landlord:

A. Wrongfully and willfully retained all or part of the security deposit, it may award the tenant damages equal to three times the security deposit, or part thereof, plus the cost of the suit. B. Wrongfully retained all or part of the security deposit, it shall award the tenant damages equal to the portion of the security deposit, or part thereof, wrongfully retained plus the cost of the suit. C. Retained the security deposit lawfully, it shall award the landlord damages equal to the portion of the security deposit, or part thereof, in dispute plus the cost of the suit.