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Is this breach of contract?

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  • Is this breach of contract?

    A family who signed last year around this time signed for a 2-year lease until 7/2021. In the contract, it indicated that the only way out of the 2-year contract would be moving due to job relocation. However, the family has now given us a 60-day notice saying they will move out this July 7/2020 because they have purchased their own home. Is this a breach of contract? Their job did not change so technically speaking, they are suspending the contract for a different reason. Is there something we should/could do about this? The tenants have been fantastic (minimal hassle, always pays rent ahead of time, good people). We would really like them to stay but don’t know how to go about this situation. Any advice is appreciated!

  • #2
    The problem is assume it is a breach, you now need to enforce it by demanding specific performance, payment according to the lease or a settlement.
    Easiest is deal directly, next would be an attorney.
    Hopefully some direct owners chime in.

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    • #3
      The way it reads, certainly sounds like a breach. But like
      Tim said, enforcing is the issue. And is it worth it? What does your contract, if specified, mention regarding penalties/compensation? Or are you looking to collect the balance of rent for the remaining contract term?

      Me? I'd say:

      I'd really thought you'd want to stick out your contract to avoid any penalties or fees. But if you think it's worth it, then we'll work out the costs.
      $1 saved = >$1 earned. ✓

      Comment


      • #4
        As a practical matter, for a residential lease the landlord almost certainly has a duty to mitigate. (You need to market the property and find a new tenant promptly.) It’s unlikely that a judge will keep your tenants on the hook for another full year of rent payments. If they damaged the property, sure, they ought to pay.

        You need to market the property and find new tenants. If you were charging below market rent you might make more money. If you were charging market rate rent you should be able to find another tenant within 60 days, especially during the height of the summer moving season. If you were charging above market rate rent, this kind of bites for you, but a judge won’t find that you’re entitled to another full year of above market rents.

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        • #5
          I find it rude that they decided to do this without discussing and coming up with an acceptable plan in advance but that aside they would need to assist with finding a new tenant immediately. In the past my tenants who wanted to break a lease showed the property themselves and were quite helpful in securing a new tenant. I made it clear the prospective tenant would be vetted for credit, rental history, income etc. If the property stays fully rented I'd say no harm no foul however if not at the very least I would keep their security deposit as non-payment of rent due to the breach in contract. Personally although I'm not a lawyer I can't imagine why a court case wouldn't favor you in this instance but whether it would be worth the hassle and strife is another story. Good luck.

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          • #6
            It's definitely a breach of contract but I'm not sure how far I'd go to enforce it. I'd probably just let them know, ask for them to be helpful in getting it rented out, then thank them for being good renters and forget about it.

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            • #7
              We were also thinking it’s most likely not worth the time and effort to litigate. Besides, the court almost always sided with tenants. We are charging market rate rent and a new tenant would occupy the space around mid-July. The current family has already sent us a check for the totality of June and July rent (they always like to pay early). We won’t keep their security deposit since they have been very good tenants. In exchange, maybe they could help us find some new tenants. From prior experiences, what’s a good way to ask them for help in regards to finding a new tenant?

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              • #8
                Don't do that. Just market yourself and move on. If you are unable to find a tenant for a few months after they move out you could come after them for that difference. You could come after them for the additional costs of showing the property again, as well. But is it worth it?

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                • #9
                  I think they understand they're breaking the contract, which is why they paid through July. You basically have 70 days to find a new tenant. Just let them know that you will be showing the property to prospective tenants and you'll give them x many hours notice.

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                  • #10
                    Originally posted by Brains428 View Post
                    I think they understand they're breaking the contract, which is why they paid through July. You basically have 70 days to find a new tenant. Just let them know that you will be showing the property to prospective tenants and you'll give them x many hours notice.
                    Agree. I don't have any rental properties but it sounds like they're giving you plenty of notice, not just ghosting off one day with a note on the door..

                    Comment


                    • #11
                      I agree with your purposed approach. I suggest saying something along the lines of: as you are terminating your lease early, we would appreciate your assistance in helping find another tenant. We will need to be showing the property and would appreciate your flexibility in allowing prospective tenants to view the property and keeping it in show worthy condition. Up to your discretion if you add something about wanting to rent it promptly so they are not liable for additional months.

                      If you have a significant delay in renting it out you can ask the former tenant to pay those months. You could pursue a small claims court case for the lost rent if they refuse. If you are considering this I would keep records of your attempts to rent it out and evidence that you are asking market rate. Obviously it would be up to you if it is worth doing so.

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                      • #12
                        Originally posted by CordMcNally View Post
                        It's definitely a breach of contract but I'm not sure how far I'd go to enforce it. I'd probably just let them know, ask for them to be helpful in getting it rented out, then thank them for being good renters and forget about it.
                        Same approach. A reasonable compromise is find new renters. If you actually make best efforts, you would be ethnically correct in requesting to be made whole. They would have skin in the game. No vacancy or loss, no problem. Actually, some places put a sublease option with approval for this purpose. Good tenants can give you good referrals as well.

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                        • #13
                          I would call them out on it but I wouldn’t pursue it any further than that. I wouldn’t do it in a confrontational way but I think something needs to be said.

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                          • #14
                            Originally posted by childay View Post
                            Agree. I don't have any rental properties but it sounds like they're giving you plenty of notice, not just ghosting off one day with a note on the door..
                            But giving notice to break a contract without options or agreement of both parties doesn't make it ok.

                            Comment


                            • #15
                              I would only release them from the lease contingent on the unit being rented.

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