Is it worth your while to sue your tenant for rent arrears or other costs?
There are many ways in which a tenant can breach the terms of the lease, triggering the eviction process, but by far the most common is non-payment of rent. While you may succeed in evicting the non-paying tenant, eviction itself may not result in settlement of the outstanding debt. To recover your rental arrears, you may have to take to the courts and sue your tenant.
Why you might sue your tenant
Unpaid rent is the most obvious and the most common cause for litigation, but there are several other reasons why you might need to bring court action against your tenant or former tenant. Here is a fairly comprehensive list of grounds for a lawsuit, but there could be others.
- Unpaid rent: By law, if your tenant fails to pay the rent on time, you must notify them of your intention to cancel the lease and give them 20 working days to rectify the breach. If they fail to do so, then you can apply to the court for an eviction notice. Remember only the Sheriff can evict a tenant. However, you can sue them for the unpaid rent.
- Unpaid utility bills: If the tenant vacates the property, either via eviction or lease cancellation, any outstanding utility bills in the tenant’s name can be recovered. The first option is the security deposit. However, this may be inadequate to cover the amount owing.
- Damage to the property: Inspection of the property at the beginning and end of the lease is a vital step you must not overlook. You will only be able to claim that a tenant has caused damage to your property if you have conducted a thorough inspection and compared the moving-out state with the condition of the unit on entry. If the tenant has indeed caused damage, you can deduct the cost from the security deposit. If this is insufficient (and it will be if there is also unpaid rent), you can take your tenant to court.
- Unapproved alterations: The scope your tenant has for making alterations to the property will be dictated by the lease. However, any building alterations must be approved by you as the landlord. If the tenant has carried out work without your approval, you can sue the tenant for the cost of restoration.
- Tenant owes more than security deposit amount: If, for any of the reasons above, the security deposit has been exhausted and you are still owed money, you can take to litigation to recover the rest.
- Recovery of lost rent if your tenant does a flit: If your tenant moves out before expiry of the lease, you are entitled to any rent they failed to pay as well as the remaining rent due on the lease. This is effectively lost income to you and they have a legal obligation to honour the lease if they did not terminate it through the proper channels.
- Cost of finding a new tenant: If your tenant moves out early without your agreement, you may need to find a new tenant urgently, if you rely on the income from the property. You may be able to claim compensation for the cost of advertising and credit checking new tenants.
- Expenses incurred in storing or disposing of abandoned property: As discussed in Abandoned Personal Property: What Should a Landlord Do?, you cannot dispose of a tenant’s property immediately. Therefore, if you incur storage costs and/or ultimately have to pay for disposal, you can sue the tenant for this cost.
- Tenant used the property for illegal activity: If you discover that your tenant used your property for an illegal activity, you can sue them to recover damages. However, unless the police have been involved, your suspicions may be difficult to prove.
- Keeping a pet against the terms of the lease: If your lease stipulates “no pets”, but the tenant has kept an animal on the property, you can sue for damages (this is a breach of the lease agreement) as well as for any damage actually caused by the pet (dirty walls, stained carpets, etc.). As above, the security deposit may cover the damage; then again it may not. But you will need proof, e.g. photographs of the pet. It may be difficult to claim that a dog caused a stain if you do not have evidence of a pet on the premises.
- Any other breaches of the lease: If the tenant has broken any other clause of the lease, resulting in financial loss or emotional or physical harm to you, you may need to claim compensation through the courts.
Lawsuits are expensive, time-consuming, and stressful. If there is any other option for recovering money you are owed, a good eviction lawyer will usually advise you not to sue. However, there are potential positive outcomes from litigation that are worth bearing in mind.
- Firstly, it is sometimes sufficient to threaten to sue. Often, on receipt of a court summons, the respondent will suddenly become very willing to negotiate and you will wind up settling out of court. They may know they will lose, or they may just want to keep their name off the court records. Their negotiation may seek a compromise and you may not succeed in recovering all your costs, but this may be a price worth paying to bring the matter to a close and avoid the hassle of a court case.
- On the other hand, sometimes taking a tenant to court is the only way to recover your money, particularly where there is a dispute over damages. Without the force of the law, it may be difficult ever to see the money owed to you. In the case of damages, the entry and exit inspection reports, with photos, are essential to your case.
- You may also wish to claim for additional damages. For example, in the case of #6 above, where a tenant vacates the property before the expiry of the lease, you can sue them for the rent remaining on the lease and possibly the cost of finding a new tenant.
- If there is a risk that your tenant may malign your reputation as a landlord, even if you have acted entirely within the law, suing your tenant and winning is legal proof of your upstanding position.
- Finally, your case against a trouble-making tenant will be on the record, should they ever try to sue you in future. A successful lawsuit is evidence that you have followed proper procedures and upheld all the laws regarding rental housing.
Of course, no action is without risk. We’ve outlined the benefits of litigation, but you should be aware of the risks as well.
- Obviously, you might not win! Even if you feel you are in the right, there is no guarantee that you will win. Of course, a good eviction attorney will make sure you are fully prepared and have all your evidence in order, thus improving your odds. But it’s all down to the judge on the day.
- Winning doesn’t automatically mean you will be paid. The tenant will have a court judgment against them, but collecting the money is another matter!
- Litigation is costly, whether you win or lose. There is the court fee to pay, and the cost of an eviction attorney. You could represent yourself, but your chance of success is much greater with expert legal representation.
- This is less likely, but you might provoke your tenant into a countersuit. If you lose, you might wind up having to pay out money to your tenant in court costs and legal fees. Again, if you engage the services of an experienced eviction lawyer, this is unlikely, but you should be aware of the risk.
Let Cape Town eviction lawyers help
If your tenants have left you high and dry and you need to recover money owed to you, either through the courts or out of court, contact Eviction Lawyer Cape Town, now also in Johannesburg and Durban. We are experts in eviction law and will ensure that you follow the proper procedures. We have an excellent track record in helping landlords and, with us on your side, the probability of getting your money back is excellent. Call Simon on 086 099 5146 or email email@example.com for a confidential discussion today.