Cross-reference: See this blog post – Can a residential tenant terminate a lease: (1) within 3, 5, 10 or some other number of days after signing the lease, (2) if the tenant loses his/her job, (3) gets a job transfer, (4) if there is crime in the area or (5) if they are the victim of a crime?
Without regard to whether the tenant needs to break the lease or merely wants to break the lease, this post discusses the duties of both the landlord and the tenant when a tenant breaks the lease.
Both the landlord and the tenant have a duty to “mitigate” (i.e., reduce and/or limit) damages. Some examples include: (1) the tenant leaving the rental property clean and “rent ready” when the tenant vacates, (2) allowing the landlord to post a “for rent” sign in the yard and/or window and allowing the landlord to show it to prospective tenants, and (3) finding a replacement tenant. Leaving the property clean and undamaged will reduce or eliminate the amount of time the rental unit is not available to be rented. Allowing the landlord to show the property may reduce or eliminate the amount of time the property is not rented. Remember, the tenant is obligated to pay rent until the end of the lease term, which includes the time it takes to clean, repair and re-rent the property. The tenant is also responsible for all the landlord’s expenses as a result of the breach of lease, such as advertising expense, real estate commissions, etc. On the other hand, the landlord also has a duty to mitigate damages. If the landlord is given advance notice that the tenant is vacating the property, the landlord must take “reasonable steps” to re-rent the property. Much litigation involves determining what is “reasonable,” but if the landlord takes no action (i.e., no sign, no advertising, no effort to clean and prepare the property for a new tenant), then the landlord has failed to mitigate damages and a court can (and should) deny the landlord rent for the period of time that the landlord took no action. Similarly, if the tenant can find a replacement tenant (i.e., via advertising, word-of-mouth, etc.) and the replacement tenant meets the landlord’s minimum requirements, then the landlord must either accept the replacement tenant or risk the chance that a judge will find that the landlord “unreasonably” withheld consent and, therefore, failed to mitigate damages. Both the landlord and the tenant should document efforts to mitigate damages. The landlord should keep a list of the steps taken to re-rent the property (i.e., ad in paper, sign in yard, list with broker, etc.), along with the cost thereof. The tenant should have the name and address of any potential tenants that the landlord “unreasonably” rejected. The tenant should take photographs and video of the property when the property is vacant and the tenant is leaving the property for the very last time; this is to rebut allegations by the landlord that the place required a lot of cleaning and/or repairs before it could be rented. And the tenant should either check, or have someone else check, to see if the landlord puts up a “for rent” sign after the tenant vacates (if hasn’t already been put up before the tenant vacates). If the tenant can document that the landlord did not put up a “for rent” sign (which is the absolute minimum that most judges will require), then the tenant has an excellent argument that the landlord failed to mitigate damages, which will reduce or eliminate the landlord’s damages.
