Real Estate Tips |9 min read

5 Reasons Why Your Tenant Can (Rightfully) Sue You

A rental agreement is a legally binding contract between you and your tenants. That said, although many laws protect the rights of property owners, landlords must recognize that tenants have rights. Tenant rights protect renters against illegal landlord actions. As such, understanding some of the reasons tenants can sue landlords and how to avoid potential issues is crucial. Read along as we go over the top five reasons tenants can sue and how to de-escalate each situation.  

Top 5 Reasons Tenants Can Sue 

Tenants can sue landlords for a number of reasons. To avoid a lawsuit, landlords must treat tenants equally and respectfully and follow all landlord-tenant laws. Here are a few scenarios where a tenant may rightfully sue a landlord.  

  1. Wrongful Eviction 
  2. Disputes Over Security Deposits 
  3. Breach of Quiet Enjoyment 
  4. Safety or Livability Concerns 
  5. Violation of Tenant’s Consumer Report Rights 

Wrongful Eviction 

Although landlords are over 90% successful in winning lawful evictions, wrongful evictions are entirely different. Landlords can seek to evict a tenant from their rental property for a few reasons. For instance, an eviction is lawful if tenants stop paying rent, fail to move out at the end of a lease term, or disregard lease terms throughout their tenancy.  

However, there are some instances of wrongful evictions where a tenant may sue for costs and damages in a court of law. For example, some wrongful evictions may include retaliatory evictions, not following the correct procedures or privacy violations. If you want to learn more about the types of unlawful evictions, we’ll discuss these scenarios more in-depth later on in this article.  

Disputes Over Security Deposits 

Another reason tenants may sue landlords is over security deposit disputes. In fact, this is one of the most contended disputes between a landlord and a tenant. If a landlord doesn’t return the security deposit in time, a tenant has the right to sue for up to 3x the withheld money plus reasonable court fees.  

Luckily, there are several ways for landlords to avoid lawsuits over security deposits. The first step is to fully understand and recognize security deposit best practices. It’s crucial to charge a lawful amount for the deposit, conduct move-in, and move-out inspections, and always save receipts. We’ll discuss more regarding security deposits later in this article.  

Breach of Quiet Enjoyment 

Most state laws include an implied covenant or warranty built into every rental property lease agreement. This implied warranty entitles tenants to “quiet enjoyment” of the premises while leasing the home. As such, tenants are guaranteed the right to live peacefully without privacy violations or landlord harassment.  

If you breach your tenant’s right to quiet enjoyment of the property and your tenant feels compelled to leave, you may be responsible for all expenses related to a “constructive eviction.” For example, some behaviors that are prohibited include:  

  • Turning off the utilities 
  • Improper entry into the property 
  • Allowing others to enter the property without notice or consent 
  • Showing up at a tenant’s workplace to discuss landlord-tenant issues 
  • Violation of rights via gossip and rumors 

Safety or Livability Concerns 

If a landlord provides an uninhabitable residence, tenants can rightfully sue. Furthermore, most state laws dictate that all lease agreements have a statement guaranteeing a reasonable safe, and inhabitable property. There may be some inconveniences that a tenant wants a landlord to address quickly, like cosmetic defects or small maintenance repairs. However, these aren’t considered unlivable circumstances. 

Unlivable conditions are those that pose safety and health risks for tenants. For example, some unlivable circumstances include:  

  • Lack of light, electricity, heat, or water (not due to failure to pay utilities) 
  • Lead paint hazards not addressed by the landlords 
  • Severe rodent infestation 
  • Structural defects that pose a severe threat to the physical safety of tenants 
  • Lack of sewage disposal 

Violation of Tenant’s Consumer Report Rights 

As a landlord, violating the Federal Fair Credit Reporting Act could mean serious court time. Consumer reports are often used to screen potential tenants, and they also matter during eviction proceedings. That said, it’s crucial to note that many violations may occur while utilizing a tenant’s consumer report. Here are some common violations of tenant consumer report rights.  

  • Not reporting tenants to the credit bureau 
  • Requiring a co-signer when unnecessary 
  • Filing unnecessary or wrongful evictions 
  • Failure to send appropriate rejection letters explaining the reason for denial 
  • Requiring a higher security deposit amount for certain tenants 
  • Denying an application for unwarranted reasons  

Types of Wrongful Evictions 

Landlords must understand that an eviction is a legal process that must be followed to prevent a tenant from suing. That said, some instances of wrongful eviction where a tenant may hold legal grounds to sue include: 

  • Retaliatory Eviction 
  • Privacy Violations or Harassment 
  • Not Following State Procedures 

Retaliatory Eviction 

A retaliatory eviction may entail taking possession of your property, increasing rent, or decreasing a provided service to tenants who meet any of the following criteria:  

  • Tenants who file complaints with a Government Authority 
  • A renter involved in a Tenant’s Organization 
  • Someone who’s filed a lawsuit against the landlord for an unrelated issue 
  • A resident who’s notified the landlord about potential lead hazards 

Privacy Violations or Harassment 

If a tenant feels like you’ve violated their privacy or harassed them to the point of leaving the rental property, it’s a wrongful eviction. After all, if they didn’t do anything that warrants proper eviction measures, it’s unlawful to push them out of your rental home.  

For instance, showing up at a tenant’s place of work to discuss landlord-tenant issues is considered harassment. Violating a tenant’s rights via gossip is also harassment. If you enter the property or allow others to enter the property without proper notice or consent, it’s a privacy violation. As such, any of these behaviors are illegal and may cause a tenant to sue.  

Not Following State Procedures 

To file a proper eviction, there’s certain paperwork to fill out and guidelines to follow. Regardless of whether your reasons for eviction are valid, you can’t just kick your tenant out on the street. Wrongfully evicting a tenant is one of the main reasons tenants can sue you and charge for damages related to the eviction, court costs, attorney fees, and more.  

Without a proper court order, landlords may not:  

  • Change the locks to a property 
  • Cut off utilities to the home 
  • Move any tenant belongings out of the rental property 

Penalties of Wrongful Eviction 

If a tenant feels wrongfully evicted, they can take you to court. That said, if you didn’t follow the proper legal eviction proceedings, your tenant might have a case, and you may be charged. Additionally, a tenant can also file a civil claims against landlords that may include trespassing, assault, battery, or other offenses.  

Unfortunately, evictions are expensive. If you wrongfully evict a tenant, you could end up paying even more, including:  

  • Legal fees 
  • Court costs 
  • Damages – up to 3x actual damages or monthly rent costs 
  • Punitive damages – depending on state regulations 
  • Entire security deposit amount 
  • Jail time – In some states, some wrongful evictions are criminal offenses that may subject landlords to up to six months in jail.  

How to Avoid Disputes Over Security Deposits 

There are several ways for landlords to avoid disputes. If you want to avoid a security deposit dispute, follow these best practices. 

  1. Charge the Correct Amount- Charge your tenant a fair amount for the security deposit based on the current market and your property specifics. Some states only allow you to charge up to 2 months’ rent. You may think that undercharging a tenant can help rent your property more quickly. However, it may attract a financially unstable tenant.  
  2. Keep Accounts Separate- Don’t deposit the security deposit funds into your regular bank account. Instead, set up a separate account for deposits and keep the money there. That way, there’s no confusion about where the security deposit money is, and you don’t accidentally use it for personal finances.  
  3. Conduct Move-in and Move-out Inspections- Before a tenant moves in their belongings, have them inspect the property and mark the condition of each detail as they walk through. Then, when the lease is up, inspect the property again and take pictures of any damages caused by the tenant. That way, there’s no confusion about previous damages or security deposit deductions. 
  4. Know the Laws- Landlords generally have a specified amount of time to return their security deposit after a tenant moves out, usually around 30 to 45 days. Some laws govern how tenants receive notice of charges against the deposit and required receipts. So, knowing these laws as a landlord is crucial to avoid disputes with previous and future tenants. 
  5. Save All Receipts- If you need to deduct from a tenant’s security deposit, document every repair transaction by keeping the receipts. Then, you can show the reason for deductions and the exact amount it took to repair damages. This is crucial in ensuring your tenant can’t dispute the charges later.  

Best Ways for Landlords to Avoid a Lawsuit 

Avoiding a lawsuit doesn’t have to be difficult. Although nobody can predict what a tenant will do, there are several steps that landlords can take to avoid a lawsuit. Here are a few examples of best practices for landlords.  

  • Provide Safe and Habitable Housing- As a landlord, it’s your responsibility to provide safe and habitable housing. If your rental doesn’t meet these conditions, your tenant may bring you to court.  
  • Follow All Lease Terms- Just as you expect your tenants to follow lease terms, landlords must follow them too.  
  • Properly Handle Concerns- Safety or environmental hazards need proper treatments. Avoid potential lawsuits by acting quickly and professionally when safety hazards are brought to your attention.  
  • Address Maintenance Quickly- If tenants have maintenance concerns that go without repair, you could run into some problems. So, it’s best to address maintenance concerns promptly and use a qualified repair person to complete them.  
  • Consider Professional Property Management- If you want to ensure your rental is well-maintained and managed with care, consider hiring property management services in Northern Virginia. 

Protect Your Reputation and Your Investment 

At the end of the day, there are several reasons tenants can sue a landlord. However, most of them are avoidable. In fact, hiring rental property management is one of the best ways to keep your rentals compliant and managed properly.  

Bay Property Management Group offers comprehensive management services, including tenant screening, maintenance, eviction services, rent collection, and more. Contact BMG today if you need services in Baltimore, Philadelphia, Northern Virginia, or Washington DC.

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