On my friend Tristan Pettit’s blog (http://petriestocking.com/blog/), he talked about one of my favoriteWisconsin statutes, WI SS 704.27. This is the rule that allows landlords to charge a tenant double rent when they are still in the rental unit without the landlord’s permission. Many tenants believe this rule only goes into effect if they are in the unit past the lease end date, however it also applies when a 5-Day or 14-Day notice are given and the tenant has not vacated by the appropriate date (assuming they have not cured the problem in the case of a 5-Day.)
In the comment section of Attorney Pettit’s blog, I made a brief reference as to how I use this statute to settle many of my small claims actions for damages without a trial. I figured it was unfair to just leave that teaser hanging, so here is how I use this to avoid the time and stress of an actual trial.
To my knowledge, 5-Day and 14-Day notices don’t have an expiration date, per se. On my properties, rent is due on the first day of the month, but not considered late unless it is still unpaid after the 5th day of the month. That means on July 6th is when my 5-Day notices for rent payment go out. Figuring in time for delivering the notice, they will have a July 13th deadline for curing the default (or paying the rent owed).
Assuming the rent hasn’t been paid by the 13th, the “tenancy” would legally end, “tenancy” being the fancy legal term for the tenant’s right to live in and occupy the property.
I will take a quick side street here to point out something that is often misunderstood when it comes to renting. There are basically two parts to an agreement to rent a property. Part one is the tenant gets the right to use and occupy the property. The second part is a contractual agreement that obligates that the tenant pay rent to the landlord and fulfill other obligations as may be set forth in the contract. It is VERY important that those two things be treated as separate items. Because (inWisconsinanyway), you can terminate one without terminating the other. They both apply, but they are not tied together. If a tenant breaches the agreement, they can lose the right to use and occupy the property, but that will NOT change their obligations to pay rent or do other things they agreed to in the contract. That right to occupy the property is the “tenancy”.
So, with the notice I was talking about, when the tenant did not cure the default on July 13th, their “tenancy” ended, their right to be in the property ended. (The other terms of the rental agreement are still in play, only the tenant’s right to occupy ends.) on July 14th then, if the tenant is still in the property, they are there without the landlord’s consent; they are there past their tenancy. Once they are there past the ending of their tenancy, two things happen. First, the double rent provision as covered in WI SS 704.27 come into play. Second, the landlord now has the legal right to start an eviction action. (The first step in the eviction is for the tenant to be in the property past the end of their tenancy, without terminating their tenancy, an eviction cannot legally proceed.)
So, on July 14th I have the right to start and eviction action in court. I have the RIGHT, but NOT the OBLIGATION. This is when I start using 704.27 as tool to help avoid a trial for money damages. There are times when I will file the eviction on July 14th. However, if I know I will not be able to fill the unit quickly (let’s say I have 3-4 of that style of rental unit); and the tenant is really not causing issues with other tenants; I will take my time in filing for that eviction action.
Often, I will give them until some time in the following month, maybe even two months later. Once I have delivered that 5-Day in July, if they don’t pay August either, I will NOT issue a new 5-Day, because as long as they have not cured the default, that notice I gave them in July is still in play.
So, the rest of July comes and goes with no rental payment. August comes and still nothing. So… about mid-August I decide to do something and file for my eviction. On my summons and complaint, I am going to list July’s rent, my late fee that was established per the lease, and August rent and the August late fee. Because I know that by filing in mid-August, I am not even going to get a court date until early September, I will also go ahead and list on the summons the double rent for July 14th through the end of July, and I will list the entire month of August.
By delaying a while before filing the eviction action, that double rent really starts to add up. Let’s say that the rent was $500 per month. I did the 5-Day notice in July, and waited until mid August to file for eviction. My court date was September 5th, and it was finally September 15th before the writ was executed. Assuming it was a month-to-month agreement, the July 5-Day notice triggers an end date for the contract of August 31st.
Let’s say that the tenant has a $100 unpaid water bill, and has $300 in damages you know you can prove easily (holes in doors and things like that), and another $300 in damages that are going to be hard to win in court because you will have to prove they are not wear and tear (cleaning issues, repainting from heavy smoke stains, etc.). There was also a $500 security deposit on the account.
So… when you go to court for your damages hearing (assuming you are in a county that you are able to split the eviction action into two trials), here is your basic pleading:
July Rent $500.00
July Late Fee $ 25.00
August Rent $500.00
August Late Fee $ 25.00
July Double Rent $290.32 ($500 / 31 days x 18 days, 7/14 to 7/31)
August Double Rent $500.00 ($500 / 31 days x 31 days, 8/1 to 8/15)
September Holdover $250.00 (Contract End 8/31, Writ Executed 9/15)
Sept. Double Rent $250.00 ($500 / 30 days x 15 days, 9/1 to 9/15)
Physical Damages $300.00 (these would be itemized on the pleadings)
Water Bill $100.00
Other Damages $300.00 (these would also be itemized)
Less Security Deposit -500.00
So, based on this example, my total pleadings will be $2,540.32 (not including court costs). Of course, when I show up in court, the tenant is in shock with that $2,500+ number and so they are determined to fight it tooth and nail. After all, they think they owe July and August Rent, and take off the deposit, they should only owe me $500 or so. Okay, $600 with the water bill.
In many jurisdictions, before your actual trial, they make you try to come up with a settlement. That is the case here inMarathonCounty. This is where waiting that month to evict combined with 704.27’s double damages play in my favor.
When discussing it in the hall, the tenant of course is complaining about all of those damages that you know are border line. So before the tenant gets too far in their argument, I agree to take all of it, all $300, off the amount I am seeking. We are now down to a settlement amount of about $2,200.
Now they start coming after me for some of the $300 in real damages. Here is where I start to educate them on 704.27 and how it works. I point out that if they want to go to trial to fight that $300, that is the kind of stuff that is easy to prove and show them my pictures and written estimates to repair. However, if they look, over $1,000 of what I am pleading for are double damages for the rent being late. They already testified for the rent being late in the eviction part of the proceedings. So, if we go to trial, even if I only get half of my $300, I will still get all of my $1,000. On the other hand, if they do a stipulated dismissal, I will make half of that double rent go away, or about $500. When the facts are presented correctly and they have a chance to think about it, that $1,700 is looking pretty good. I might even be really nice and call it $1,500.
The tenant is thrilled because they are getting away with $1,500 on a court case where I wanted $2,500 – they fought for their rights and got $1,000 knocked off. I am happy because I got July rent covered with the deposit, I got paid for August Rent, I got all $600 in damages, I got my $100 water bill, and $300 for September still. So, I got all of my out-of-pocket costs covered, without a trial.
And, the stipulated dismissal will list the full $2,500 amount. It will say something like the tenant pays $100 per month for 15 months and the case is dismissed, but if they miss a payment, I get a full judgment for $2,500 (less what they paid).
I oversimplified this thing because I didn’t address how I handled court costs (which by this time are probably pushing $350 if there were two people on the lease), but it might give you some idea on how the double rent allowed under WI 704.27 can help turn more time consuming and stressful court trials into out of court settlements, which both the tenants and the courts prefer.