Landlord has right to recoup lost rent after deal is voided

By KELLY KLEIN

Last update: December 18, 2008 - 3:58 PM

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Q A tenant signed a one-year lease agreement seven weeks prior to the move-in date. In the beginning of the moving month, the tenant arrived to pick up the key and started looking for different reasons to not move into the unit.

He requested his money back -- one month rent plus damage deposit -- and informed us that he will not be moving in. We had a vacancy for one month and are trying to advertise the property.

What can we deduct from the money we received from tenant? How about charges for showing and advertisement? What is the amount that is allowed for these expenses? Can I deduct mileage, gas and my personal time that I spend during this month looking for a new tenant?

How much time do we have to send this money back to the tenant?

A You are allowed to deduct the amount you are out of pocket as a result of the early termination. Therefore, you are permitted to recoup the lost rent, as well as the cost of advertising and showing the unit.

There is no amount designated as "correct" under Minnesota Law for these amounts, but the amounts actually incurred are always considered the appropriate sum.

Whether you can deduct your personal time and travel expenses is up in the air. The main question is whether these are expenses that a tenant would naturally expect to be incurred. Unless the tenant had some special knowledge that you might incur such costs, I think it is unlikely that a court would consider them reasonable.

You should return any and all amounts, along with a written itemized statement as to any amounts withheld, within 21 days from the termination of the tenancy.

Technically, a landlord need not mitigate, or reduce damages, by renting out the unit. It is not a completely closed question that you may not collect for the entire lease, since the tenant agreed to pay whether they lived there or not.

While most courts are against a landlord collecting from a former tenant as well as an existing tenant at the same time, you may consider mentioning that you were kind enough not to charge the tenant for the entire 12 months when you send your letter.

Kelly Klein is a Minneapolis attorney. Do not rely on advice in this column regarding a legal situation until you consult a qualified attorney; information provided by readers is not confidential; participation in this column does not create an attorney/client relationship, and no such relationship is created without a retainer agreement with Klein. If you have questions concerning renting, you can e-mail her at kklein@kleinpa.com, post your questions at www.startribune.com/kellyklein or write in care of Star Tribune, 425 Portland Av. S., Minneapolis, MN 55488.

Read past columns and study rental data at startribune.com/rent.

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