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Law Offices of Ronald W. Rutz
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November 15, 2004: Verbal vs. Written Leases

Q: Why canÕt I find some place to rent without having to sign a long-term lease? I donÕt want to commit to pay for twelve months when I may only be here nine months or less.

A: Landlord/tenant complaints about each other seem to surface daily. But letÕs examine whether an unwritten lease is in your best interest.

Yes, you can have a binding oral lease, at least if the term is for a year or less. But the persistent problem is knowing and proving the terms of that lease. Without something in writing, in order to determine lease provisions, it is basically one sideÕs word against the other.

In the absence of proof to the contrary, statutes and case law have filled in many of the standard provisions of an oral lease if there is disagreement. So the first major problem with an unwritten lease is to know what each partyÕs rights and responsibilities are, because what your obligations are may differ significantly from what you assume.

But the most important problem is the fragility of an oral lease. Either side can terminate the lease by giving proper notice. The time required for the notice depends upon how rent is paid. If monthly payments are made, then notice to terminate by either side must be given more than ten days (not three) prior to the time when the next rent payment is due.

I had oral subtenants move out after giving notice on the 22nd of the month with rent due at the end of the month (the 30th). Since the notice was not received before the 20th, I could have insisted on the next rent payment even if they moved. (These particular subtenants were also under the mistaken belief that without a written lease, other breaches of their oral lease would not be enforced because "next time get it in writing" was their arrogant response.) Other enforceable breaches on their part could have been pursued by me because it was in writing -- statutes and case law. The bottom line, however, is that signing a lease gives a lessee more security and certainty as to rights and responsibilities.

If you are concerned about liability for rent payments if your plans change and you move, there are several solutions. Insert a lease provision, if possible, that you can break the lease by making one more additional rent payment (but also get your deposit back). Do not make the mistake thinking that you can just walk away and leave your deposit behind as payment for leaving early. Usually such a tenant will sadly discover that he or she is still liable.

There is also a more problematic choice. In contracts there are two conflicting lines of legal principles Š enforce the terms of the agreement as written vs. do what is equitable (fair, just, common sense, etc.). There is a legal maximum that the landlord needs to mitigate damages and therefore cannot automatically receive all of the remaining rent payments. Thus, it is possible to break your lease, pay something for that act, but not be liable for the remaining amounts.

Success depends upon the legal outlook of the Court. Some are strict constructionists and will hold each party to "what was agreed to." Other courts will apply equitable maxims that appear to benefit the party who may not be conforming to the exact letter of the lease. I have appeared before both kinds of Courts, so if possible try to learn which way your Court would lean. If you are lucky, you could be held to pay something, but not all. If you are before a "strict constructionist" Court, "damages" will be awarded based upon the terms of the lease.

A quick checklist of common problems to be covered by the lease are the number of tenants permitted, pets, damage deposits (including issues such as whether interest is paid, number of days the landlord has to return the deposit, what if one of the signees to the lease leaves before the end of the term and demands his or her part of the deposit, etc.), subleasing, landlord access to the premises, required duties such as lawn watering, defaults and enforcement, etc.).

In your case, I believe you can have your lease reviewed by someone at CSU. For non- CS4 tenants, do let your attorney review the document. You may not get everything you want (or the rent may be higher for a nonstandard arrangement), but as with so much in life, if it is important enough to you, put in the time and effort necessary to make it happen.

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