Taking a tenant to small claims court (Part 1)

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The question always seems to come up among landlords, "Should I take a tenant to court for (fill in the blank) or because they left owing me $ for (fill in the blank)?" 

Generally, I say it depends on the amount, how much your time is worth, and whether or not you think you'll actually be able to collect anything even if you win.  In almost every case, I choose to let it go because my tenants usually leave on good terms, most of what they owe (if anything) is largely offset by their security deposit, and anything still left owing is not worth my time chasing.  It's basically just a business decision.

However, that all changed recently with one tenant in particular who left owing about 2 months worth of rent ($2,300).  I was actually prepared to let that go.....right up until I saw the inside of the house after they left and the damage they left behind. 

Before they moved in, this was a fully remodeled house with everything in perfect condition.  Here are a couple "BEFORE" photos showing the kitchen and one of the clean bedrooms:

Now here are a few "AFTER" photos showing parts of the same kitchen and bedroom (notice the large hole kicked in the cabinet and the bullet hole in the side of the fridge):

Now I don't mind normal wear-and-tear or even a little above normal wear-and-tear (like holes in the drywall) because I'm pretty handy and most of that stuff is pretty easy/inexpensive for me to fix.  But I draw the line at intentional damage/vandalism like you see in the photos above.  So in this case, I chose to file a small claims case against the tenant.  It's the first time I've ever had to do it, but I figured I would do it (if nothing else) for the principle of the matter and it'd be a good learning experience.  Plus, I believed I could actually collect a judgment from this tenant since I know where they work and should be able to obtain a wage garnishment.

Long story short, I had my small claims hearing today and the tenant didn't show.  I was actually hoping they would because I was so well-prepared that I knew I'd win anyway.  But nevertheless, I still had to present my case to the judge and in the end I won a judgment for just under $6,000. 

I have to wait 30 days in which the tenant has a chance to appeal the verdict (though they have no grounds in this case), and then I plan to go back to court and obtain an order for a wage garnishment.  I'll post a "Part 2" to this story after I do that to let you know how it turns out and if I'm able to collect anything.  So stay tuned.  :)

Any thoughts/comments/questions are welcomed.

wow that is terrible. Looks like he intentionally vandalized your property. Did you not get along with this particular tenant? Did he violate the lease? Why was he so far behind in rent?

Keep us posted I'm curious to what ends up happening.

Good luck.

Dang, @Kyle J. , that's some violence done to your wonderful work! Just want to say that I really like your reasoning--both about why you don't usually take a nasty tenant to small claims court, and why you chose to do so now. Congrats on getting the judgment, and I look forward to Part 2.

Btw, I have a lot of tolerance for tenant foibles; I've been reflecting a lot lately on the follies of my own youth. But I really hate violence, to persons or property. Whew.

@Alex Alaniz   I actually did get along with this tenant.  Even after this happened we still spoke cordially.  It was a single mom and her teenage sons who lived in the house.  The sons, unfortunately, ended up getting involved with gang members and I believe it was the sons and/or their friends who did the damage.   But I even got along with the sons.  I have personally served the mom and the sons 3-day notices before when they were behind on rent during the years they lived in the house, and I would often have friendly conversations about what was going on in their lives even right after I handed them the notices.  I think we both just realized it was business and never took it personally (at least I know I didn't).  Anyway, they always got caught up on rent and paid the late fees, but in the end I think it just became too much to catch up on.  She still has a good job though with a large employer in my area so that's why I believe I shouldn't have too much trouble getting her wages garnished.

@Carol Venolia Thanks for the kinds words.  Back when I was younger and a renter, I always left places better than when I moved in.  Like the time I rented a place that only had 1 working telephone jack and 3 non-working ones when I moved in.  Remember when people used landlines? :)  Lol.  Anyway, I complained to the landlord about the non-working ones and was told that they are legally only required to provide 1 working one, which is true but not a very good stance to take in my opinion.  So I ended up fixing the wiring myself so ALL of the jacks worked and that's how it was when I moved out.  But I understand that not all (or even most) tenants take care of their home as well as I did when I was a renter.  That's why I'm generally pretty lenient, but like I said I have to draw the line at what I consider intentional (and even malicious) damage such as I found in this home.

a picture says a thousand words.. A picture with a bullet hole even more.....I think this was a rather strong case as you document it well. Plus, I think the tenant would have some explaining over the shooting of a gun in your house....much less the damage...they may not ever want to show their face to contest this as the story behind that bullet hole could lead to far worse than a civil judgment ....

Kyle, thanks for sharing this!  In 10+ years of being a landlord, I have yet to evict someone or go to small claims court, BUT I worry that it is just a matter of time, before it's my turn.  I am always gathering information, so that I am prepared, if need be.  

I look forward to reading Part 2 of this story.

By the way, with all of the social media these days, couldn't you post these pictures and publicly shame this person?  You know, expose them for the trash that they are.  

Best wishes!  

@James R. I also haven't had to evict a tenant yet.  Even this one.  It was close, but I ended up convincing her to leave without going through an eviction. 

As for publicly shaming her, I don't think I'll go that route.  I want to keep it professional and use the methods that are already available to me (i.e. small claims, wage garnishment, reporting the debt to the credit bureaus, etc). 

Plus, I don't want her to lose her job.  I need her to have that so I can actually collect on my judgment.  :) 

I took a former tenant to Small Claims Court recently, he had ruined the carpet in the unit and so damaged the walls that it had to be completely repainted as well as all the flooring replaced. The tenant voluntarily paid $2,000 and I got a default judgment for the balance of the damages which was just under $4,500. The tenant trades used cars and is an entrepreneur, so there are no wages to garnish. So I handed the account over to a collections agency that had given a presentation to my local landlord's group a few years ago. They are working on the account right now.

@Kyle J. I had the same attitude as did you, most tenants left little damage and what damage there was did not seem worth going after (no damage deposits in Ontario I am afraid). But I am emboldened by this experience. The entire process took three trips to the Court House, two to file papers and one for an assessment hearing once the tenant was noted in default. My out of pocket costs were $170. My potential upside is recovery of $4,500. That is not bad for what I would estimate as 10-12 hours work (including preparation of plaintiff's claim form, photographs, etc.) I have set a dollar limit of $500 for myself. If the damages are less than $500 I will cover them myself. If the damages are greater than that then I will sue them. I have done it once and can do it again.

Kyle's experience and my own shows that it is possible to obtain relief from small claims court, and that you can represent yourself. The law firm I had used for the eviction wanted $1,500 to take a small claims case to trial. I handled it myself simply for the cost of filing fees. The judge was very reasonable and even assisted - when he asked me what my costs were I said the $170 filing fees, then he pointed out he was allowed to award costs for inconvenience and lost time So I claimed and was awarded a further $300. My impression is that the courts are quite familiar with tenant damages cases.

Landlords have two common methods of redress:

  • Unlawful Detainer
  • Small Claims

The UD is the eviction path and you can claim past due rents, the true goal is possession.

Small Claims is all about money damages and winning is not difficult - - actually collecting the court costs and you claimed amount is rare.  You get the hollow moral victory, but nothing in your pocket.  Of course you can assign the debt to a debt collection agency and get round two of moral victories with the harassment they create, but that too is hollow.

Originally posted by @J Beard:

Small Claims is all about money damages and winning is not difficult - - actually collecting the court costs and you claimed amount is rare.  You get the hollow moral victory, but nothing in your pocket.  Of course you can assign the debt to a debt collection agency and get round two of moral victories with the harassment they create, but that too is hollow.

I agree that in many cases collecting a judgment from a tenant who may have no assets, or even a job, can be difficult if not impossible. However,  that is one of the reasons I look for tenants from the very beginning who at least have good, stable jobs with reputable employers (i.e. as opposed to someone who has an unstable work history or who gets paid in cash or under the table) because I am always planning for the future and the possibility that I may one day have to collect on a judgment. And this is an example of when that paid off because, although this particular tenant has no assets to speak of, she does have a good job with a large employer who I have no doubt will honor a wage garnishment order from the court. 

But I get your point about these victories often being hollow. 

Although my experience so far has been similar to what @Stephen E. posted above, in that I paid a small price to file the case ($75 court filing fee plus a fee to a process server) and take a chance on winning, and for that I ultimately got a judgment of almost $6,000 that I intend to collect on.  I'd say that is a pretty good return (assuming I do in fact collect). 

Again, as I mentioned in the initial post, it's just one of those things where you have to consider all the factors involved and decide if it's the right decision for you and your individual circumstance.  In this case, I decided it was worth it.

If the tenant has been employed for a long period it should be easy to collect the judgment unless the tenant changes jobs. After you serve notice on the employer for garnishment of wages you should start receiving checks in a month or so. If the tenant does not earn much the checks will be small but they should continue until the judgment is paid or the tenant leaves their job. It is quite satisfying opening those checks when they come.

Does your insurance cover vandalism? This is probably not enough damage to warrant filing a claim (and having your premiums increase) but that is sometimes also an option depending on your policy. You would, most likely, have to file a police report to make the claim.

Originally posted by @Jeff Rabinowitz :

If the tenant has been employed for a long period it should be easy to collect the judgment unless the tenant changes jobs. After you serve notice on the employer for garnishment of wages you should start receiving checks in a month or so. If the tenant does not earn much the checks will be small but they should continue until the judgment is paid or the tenant leaves their job. It is quite satisfying opening those checks when they come.

Does your insurance cover vandalism? This is probably not enough damage to warrant filing a claim (and having your premiums increase) but that is sometimes also an option depending on your policy. You would, most likely, have to file a police report to make the claim.

Good to know about the timeline to start receiving checks once I start the wage garnishment process.  Honestly, I don't care if the checks are big or small, just that I receive them.  :)

My insurance does cover vandalism, but - as you pointed out - the actual damages wouldn't be worth me filing a claim and having my premiums increase.  Especially when I expect to be made whole after this judgment against the tenant is collected.  Also, I'm really happy with my insurance agent/company.  I get great rates and my agent was actually able to get them to make an exception to their normal limit on the number of rental properties (since I own more than they typically insure for one client) because I have a good claims record (i.e. no claims ever for any property), so I wouldn't want to risk potentially having my policy cancelled or the limit on the number of properties re-instated. 

Awesome work! I have been struggling with taking our past tenants to SCC, but one of the roommates was on disability so I can't collect from her anyway. Great work on getting that judgement. That is not right.

Originally posted by @Jacqueline Carrington :

Could you send to a collection agency that way it shows as a debt and impacts their credit as well?

Yes, I could turn it over to a collection agency.  (You actually don't even need a judgment to do that.)  However, collection agencies usually take a percentage as their fee (though there are flat fee services available), and in this case I believe I should be able to collect all of it myself through the wage garnishment process so I don't want to give up part of it to a collection agency.  Though, if the tenant ended up quitting her job or moving out of state like @Jerry Rien mentioned, then I would likely consider the collection route at that point.

Glad Kyle got a judgement.  Next step is to get paid.

With my properties I put into place a tenant management strategy system I developed several years ago.  A piece of the strategy is to send tenants Thanksgiving cards with a small gift certificate.   This trains there subconscious mind to take care of my property.

Frank

Just FYI for anyone following along, I finally starting collecting on this judgment and received my first check from the wage garnishment process.  I wrote more about it here: https://www.biggerpockets.com/forums/52/topics/295592-finally-collected-on-a-small-claims-judgment-against-an-ex-tenant