Liable for damages incurred for backing out before signing lease?

Question

This clause was in an application I filled out:

"If the Applicant cancels this application after three (3) calendar days, Applicant will be liable for damages based on per diem rent for the monthly amount for the apartment requested. Such damages will begin to accrue four (4) days after the date of this application. Such damages are those reasonably intended to compensate Landlord for holding the rental unit off the open market"

The apartment was being rented out until July 5th. I applied for the apartment May 30th. I learned a week after applying that cats were in the apartment. Due to my daughter's severe allergies, and not wanting to chance the idea of pet dander being in the ducts and/or the carpet, I chose to cancel. Am I liable for this per diem fee from the time of application until the day I was due to take over?

The security deposit and other fees were waived, I've only paid a non-refundable application fee.

David Faulkner · Answer

I'm not a lawyer either, but this doesn't seem right to me. The signed lease is the contract that would take the property off the market, and if you had signed that and then backed out than I would agree you could/would be liable for damages. But if all you filled out was an application, then what are you baking out of exactly? $3000 for five days is ridiculous, and I sure wouldn't pay it. I'd be very surprised if they would take you to small claims court over the matter, and if they did I would be further surprised if they won the case, even if you represented yourself without a lawyer. People can and do put anything they want into an application or any contract, that doesn't necessarily mean that it is legally enforceable.

Deanna McCormick · Answer

All you had was a approval to your application, doesn't even sound like you signed a holding fee agreement or security deposit agreement.

Get a copy of the application form you filled out.

download the landlord tenant laws for your state and review the application form for any wording that would apply.

In my opinion the landlord is NUTS... no signed lease.. and he can't collect double rent.. for any days the prior tenant was in the unit. although this shouldn't even be part of the action.

I'd write him a stiff hard point by point letter and say no harassment or have your lawyer do it. that you want a letter stating the matter is closed no further action will be taken by him and if he does not comply you will file a action with the Fair Housing department.

Account Closed · Answer

If they give you a bill in writing, what I'd do is take the bull by the horns and take them to small claims court over the bill.  Let a judge decide.

The reason for doing this, is to nip it in the bud before they can send anything to collections, or take you to court in a regular court, where you'd have to hire a lawyer.

Normally, small claims court fees are less than $100.  You can put the entire amount of the bill as the amount you're suing for, and write in "plus court fees and any punitive damages the court finds appropriate."

The court will also add your court fees to any settlement in your favor this way.

If you end up doing this, and they want to settle, be sure to get the settlement recorded at the clerk's office properly.  Don't agree to any settlement until you go to the clerk's office and find out how to do it right.  If you agree to settle and don't do the paperwork correctly, you can end up with a document filed that says it's settled - when it actually wasn't.  I almost found this out the hard way once, and am very grateful to a helpful and very adamant court clerk, advising me to do things right so I didn't get scr*wed.

Jessica G. · Answer

Thanks to all of you for your input! I intend to take this to small claims court if they send me a bill. Thank you!

JD Martin · Answer

If you haven't signed a lease I wouldn't worry 5 cents about it. They're not going to be able to hold you legally liable for anything without a signed contract to rent the apartment.

Jessica G. · Answer

I filled out the application on May 30th but wasn't scheduled to take possession of the property until July 12 due to the fact it was already rented out. (The previous tenants didn't move out until July 5th)

The per diem they are billing me for is dating back to May 30th. And they are charging about $70for 42 days. May 30- July 12.

The only thing I have paid at this point is a $32 application fee. The per diem they are billing me for hasn't been paid.

Jessica G. · Answer

Thanks. They want to charge almost $3000, which is pretty steep, but you are right, legal fees might be even steeper.

Corby Goade · Answer

I'm certainly not offering any legal advice, but if the landlord didn't disclose that information to you up front, I'd doubt you could be required to pay the "damages." However, if they ask you to pay them, it would probably much cheaper than hiring a lawyer to argue your point.

Liable for damages incurred for backing out before signing lease?

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