Bayline September 09.indd - Bay Area Apartment Association

Legally Speaking, from page 10.
A. You may be right, but it won’t
do you any good. In legal terms, his
application is an offer to rent. Your
approval of his application is the acceptance
of that offer. The communication
of your acceptance to the applicant
is the last step to a binding contract.
Note that I said “communication”, not
“attempted communication”. If the
applicant withdraws his application
(offer) before communication of the
acceptance, there is no lease (contract).
You appear to have an insurmountable
proof problem in showing that the applicant
actually heard the voice mails
and knew that he was approved before
he put his withdrawal in the drop box.
Return the deposit.
Q. Our pet addendum requires a
non-refundable $200 pet deposit to
cover the expected wear and tear of a
pet on an apartment. A recently vacating
resident has demanded the return
of his pet deposit. While I agree that he
left his apartment very clean, I pointed
out that the pet deposit is shown as
non-refundable. The resident is threatening
a lawsuit. Is there any chance he
could win?
A. A “non-refundable deposit”
Bruce Melanson, Owner
BAAA member for 20 years
BAAA Associate of the Year 1991, 1993 & 2002
12 • September 2009 • Bayline
is an oxymoron. All deposits are by
definition refundable. This is your
lease language, and a judge is going to
construe it against you and in favor of
the tenant. (Contract ambiguities are
construed against the contract drafter.)
If the thirty days for your notice of
intent to claim against security deposit
has not run and you have any actual pet
damage, you can claim against the pet
deposit. Otherwise, return the deposit
and change your addendum language
to a “non-refundable pet fee”.
Q. I have a resident who constantly
pays her rent on the fi fteenth of the
month, without the late charge. She is
retired, and that is when her pension
check is direct deposited into her account.
Our lease clearly states that rent
is due on the fi rst with a late charge on
the fi fth. Out of the kindness of my
heart, I have been accepting her rent
without the late charge. My regional
indicated that if I keep missing my
accounts payable goal on the tenth of
the month, my job may be in jeopardy.
This month I posted a 3-Day Notice on
her door on the third of the month. I
received a letter from her lawyer indicating
that any attempt to enforce the
3-Day and require payment before the
fi fteenth of the month would be met by
a lawsuit on behalf of the tenant. Can’t
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this lawyer read the lease?
A. While it’s diffi cult (and sometimes
frightening) to guess what’s going
on in a lawyer’s mind, I’ll take a stab
at it. The lawyer is probably basing
his position on a legal concept called
“modifi cation by course of conduct.” It
holds that the terms of a written document
can be superseded by the course
of conduct of the parties. In layman’s
terms, the real deal is what you do, not
what you wrote. She paid late a number
of times, and you accepted it without
objection. Your actions modifi ed the
written due date from the fi rst to the
fi fteenth.
Depending on the length of time
over which you have permitted the late
payments, you may have permanently
modifi ed the lease. If you were accepting
late payments when you renewed
this lease, you have probably modifi ed
the lease to accept late payments. Your
lawyer can advise you based upon the
facts of the particular situation. If the
situation is correctable, you correct it
by giving the tenant reasonable notice
that future rent payments must be made
timely. I suggest two notices, at thirty
days and fi fteen days. I also suggest that
the tenant receive at least one warning
letter when and if she pays late again.
To avoid the course-of-conduct
argument, you should have sent the
tenant a letter that you were accepting
the late payment and waiving the late
charge as a resident relations courtesy.
The letter should have insisted on strict
compliance with the rent due date in
the future. Of course, this letter loses
its value when you send it every month
for six months. As a fi nal note, many
leases contain a provision that any failure
to insist on strict compliance with
the lease terms (rent due date) is not a
waiver of future lease performance. This
provision can be invoked in isolated
instances of lease noncompliance. It
is risky, and even foolhardy, to rely on
it to overcome the course-of-conduct
argument for repeated similar noncompliances.
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