Mutual Termination Agreement

9 Replies

First off, I'm new to the BP community and I just wanted to say and give a slight intro about myself.  My wife and I have been landlords for 16 years and now have three properties simply because we just converted our homes to rentals each time we moved.  In all the years we've been landlords we've never had any issues with our tenants and have had great working relationships with them.  We've always gone above and beyond to take care of our tenants and hoping in return they would do the same and fortunately for us they have. 

We now have a tenant that moved into one of our properties in November and who have been headaches since the walk through when we handled the keys over to them.  We did a proper screening just like we have with all our other tenants but these tenants completely did a 180 on us the moment the received the rental.  I won't go into the details of every issue but I am sure we have gone above and beyond and have taken care of even the most minor issue(or non issue) in a timely manner.  Especially with this latest issue.

I won't go into all the details because I could write a novel with it, but basically they threatened with lawsuits, our lawyer doesn't think they have a case but advised to offer them their some money(rent) just to get them out because it will most like be cheaper than going through lawsuit.  We swallowed our pride and offered them May's rent back and they leave withing 7 days as long as they sign a mutual general release.  They refused and are working on getting everything finalized on their estimates for damage and hotel stays away from the home.  There's no way that their new counter will be anywhere near reasonable once they finally get it to us.   A lawsuit at this point is inevitable so we have rescinded our offer that they wouldn't have accepted anyways and are not both agreeing to work on a termination of lease to get them out by May 31 so they're not responsible for rent and we won't have to start the eviction and they can sue us in which case, USAA will take over for us and we won't have to spend even more money on the lawyer that we're currently working with.

The new terms will be that we give them back only their security deposit less damages and we'll send it to them as soon as they pay the last water bill and they will vacate by May 30.  I wanna make sure we don't mess this up and having it cost us later but this is the best and simplest termination I could find:

  

Mutual Termination of Lease Agreement

For good and valuable consideration,___________________, landlords, and _________________________, tenants, agree to amend and terminate the lease/rental agreement presently in force and dated _____________________. Said lease/rental agreement for the property located at__________________________________, shall become null and void, once consideration has been given and terms and consideration are complied with, as described below, and this document is executed by all parties. Terms of Consideration:

In this mutual termination, both landlord and tenant agree to the disposition of deposits and financial responsibilities in the following manner:

Landlord will return security deposit by June 6, 2018 less damages caused by tenants, missing items and outstanding utilities/water bills.



We'll fill in the terms later but do you think this is good enough?  What would you add or delete?  Any suggestion helps.

Thanks,

Ko Saynourath

I wish you would share the details of what they are claiming, but I suppose it doesn't matter.

This agreement looks good except I don't understand why you would return the deposit so quickly. I think your state allows 30 days to return the deposit or notify them of how it was spent. I would only state "Landlord will return the security deposit in accordance with Colorado law."

Not an attorney, this agreement simply terminates the lease but there is nothing in there that prohibits them from suing for supposed damages/costs/whatever that occurred during the lease.

I'm guessing you need some type of hold harmless or something stating both parties fully release each other from any issues/cost/breaches/etc resulting from the lease/occupancy that occurred during the lease period.

Nathan-  Here's a quick description.  Sump pump in laundry room in basement failed on March 30.  Replaced immediately, new one failed a month later and replaced again with a better one recommended by plumber.  Vinyl floors got when from small flood.  After second failure, tenants worried about mold because of vinyl floors holding moisture underneath.  Ordered  mold test immediately so as not to upset tenants since they're frustrated about the flooding even though no damage done to their property.  Mold  air sample test came back low, more mold outside than inside.  However, black mold was found behind washing machine on drywall that was behind slightly peeling vinyl baseboards.  Mold tester recommended remediation for the mold that was found but didn't express any concerns about the level of mold being a concern but I ordered the remediation right away since insurance is paying for water damage due to sump pump failure.   Tenants flipped their lids, called and cussed out the testers claiming they're fudging numbers and evidence and ordered their own mold test which also came back low.  Remediation company ordered asbestos testing on drywall and flooring to be removed as required by law. While getting samples being collected from asbestos testing, noticed more vinyl baseboards and flooring being pulled up by tenant therefore advised by our lawyer to hire a industrial hygienist to do more thorough testing that will hold better in case of lawsuit that tenants have threatened. Those results won't be ready until next Tuesday and remediation is set to begin the same day.

Tenants still upset and "constructively evicted" themselves due to failure of landlord to remediate the mold and breaching warranty of habitability despite the fact that we have been doing everything we can in a timely manner and can only go as fast as the process will allow.  Tenants have also claimed that since mid April they have been having symptoms such as burning nostrils, burning eyes, coughing, sore throat, headaches, earaches.  They claim her mother who helps babysit also experience these symptoms and her father who was visiting from California also experiencing symptoms.  They're even going as far as to say the moment they step into the house they can immediately feel the difference in the air quality and these symptoms occur right away.  They also claim just by standing outside and peaking inside with the window open that they can feel the difference in the air quality also.  All this despite our air tests and theirs came back really low for mold.  They also claim the house reeks of mold.  We've had 5 different people come to do tests and estimates who have not experienced any symptoms even though they claim their whole family has had symptoms and that their symptoms start the moment they step into the house and they magically feel better as soon as they leave the house.  

We have everything documented from texts, emails, receipts that have shown we have done everything we can to get this remediated asap yet.  All the texts and mails they've sent have been threatening and they have been working harddigging up stuff and trying to paint us as evil landlords that don't care about their health and safety regardless of the evidence has shown otherwise.  

Now we just want them out so we can start showing prospective tenants the property as soon and remediation and rebuild is complete.  Since they're refusing our proposal of May's rent andthe mutual general release that releases both parties from any future lawsuits, we just want them out by June so we can get new tenants and not to have to evict them which will only extend the time we can get new tenants.  We'll deal with their lawsuit later if they can convince a lawyer to take their case.  

@Ko Saynourath mold is terrible because the media has dramatically exaggerated the entire issue. Most mold is not dangerous and - as you pointed out - it's everywhere, even in the air outside. Most people won't even have a problem with mold other than the smell. It usually only affects those with pre-existing respiratory issues.

The law does not require you to snap your fingers and make the issue disappear immediately. It requires you to act quickly and responsibly, which it sounds you are doing. You've had it tested, you are remediating the problem above and beyond what was probably recommended. I'm not an attorney but if what you are telling me is true, you should have no problem defending yourself. Besides, most tenants only threaten to sue but they'll never actually go through with it, particularly if you have all the evidence to back up you claim.

I agree with @Wayne Brooks that your Mutual Termination should include a statement that the tenant accepts the early termination and waives their right to sue at a future date.

Nathan-

I agree with you said but they are so unreasonable and they constantly contradict themselves.  The female tenant does say she has asthma and she rarely has to use her inhaler until now.  I suppose that could make her more susceptible but the two different air tests have already come back really low for black mold.  The claim of all their family members getting sick and that they experience  symptoms the moment they step in the house and they can feel it in the air is pure bs.  I want to take them seriously but history has shown they are overly dramatic and make a big deal about everything. They're really trying to nail us for not taking this serious and are doing nothing about it. I'm not worried about their threats at all but at this point I'm just worried about my wife. The stress and anxiety is taking a toll on her.

I'll wait to for the report and  results of the tests that the the industrial hygienist is doing.  He's basically a forensics expert which takes the whole environment into account versus just an air and swab test that the others have performed.   So far he doesn't seem concerned though.  

As far as the agreement, the 'mutual general release' was the agreement that our lawyer advised us to offer them which basically includes everything Wayne suggested.  They rejected that already even with us offering to give them back May's rent.  Judging by their words, my opionion is that more from us and that's why they rejected it.  Now we're doing this new mutual termination agreement on our own without the lawyer since his fees are adding up fast but just wanted to make sure we're not doing anything wrong.  We're  just trying to get them out asap so we can we can move on and they can  be legally released from their obligation to pay rent since they've already moved out but are still bound by terms of the lease.  Our insurance company USAA says they can't give us legal advice now but once we get sued, they will take our case and defend us. 

Sorry you are going through this.  It's always so interesting when a tenant claims how a house is making them sick and/or is unliveable, yadda, yadda...but then doesn't vacate the premises asap.

Just an update and a few questions.

First, thanks for replying to this thread.  

The tenants agreed to a termination  on May 31 with a return of their deposit once cleaning and damages are deducted if need be.  In our draft to them we had the final walk through at 16:00 but they didn't agree and wanted it at 23:59 since they're paying for the full day.  Seems like a power trip move to me but whatever, we signed the termination just to get them out of there.  Afterwards  I told them we can meet at midnight(knowing well that they'd never go for it) for the walk through or else 8 am.  Well the girl refuses to go into the house because it's too dangerous for her and the boyfriend has to work and they'll get back to me about the time.  

This weekend they started moving out but aren't completed yet.  I went to to the rental again this morning to let the remediators start the work and they told me they should be done tomorrow and then 48 more hours of letting the machines run to clear any mold in the air.  And like everyone else, they stated that the rest of the house outside of the contained basement can be used which means they can come move the rest of their stuff.  I let the tenants know this and they went on again about how hazardous it was in the house and that doctors and their hygienist said they can't be in the house until it's clear of mold in there.  Which is funny because when we signed the termination last week, he came out of the house without his hazmat suit and the neighbor also told me he was in the house all day without the suit moving furniture into the detached garage.  He was also in  the house all weekend moving but all of a sudden can't go back into the house because it's too hazardous.  

So basically the question I have is what can I charge them for us to clean the house?  I'm anticipating them not having the house clean by the end of the lease and I don't want or trust them back in the house.  There's nowhere in our lease that states the cost we would charge if we have to clean it ourselves.  We've eaten a lot of cost already because of these tenants and will most likely have no rent collected for a big portion of June.   We would rather clean it ourselves rather than hiring cleaners to come in to and just charge them for our time to clean the house.  Would it be wise to just hire cleaners and deduct it from their deposit or clean it themselves and charge them for the time it takes us to clean it ourselves?  I'm also not sure they're gonna do a final walk through before the lease expires.  If they request one after the lease expires, do I have to give it to the?  The moment their lease expires, I want to get in there and clean right away to get the house back on the rental market?

They are pulling your chain. Treat them like you would anyone else. If they stay longer than agreed, charge them for it. If they don't clean, charge them for it. If they scratch a wall or dent the door, charge them for it.

I manage over 300 rentals and get at least one tenant a year trying to pull the "mold card" on me. It's a ruse to get out of a lease, nothing more. One of them complained it was making her daughter cough constantly, but then we discovered the mom was chain-smoking in the house.

Cut off all communication except in writing. Inspect the property without them present so you can go through in detail and not be distracted. Charge them for every penny owed. They don't have any evidence to support their claims in court so you shouldn't have anything to worry about.

Thanks again, Nathan.  I've been assertive but polite with them but they just don't don't want to work with me.  I know they don't have a good case and they're just yanking my chain but they keep threatening lawsuit.  I've always had good relationships with past tenants and this is new to us so we're just a little worried and probably for no good reason but still can't help it.

As far as them using mold to get out of the lease, I'm perplexed as to why they wouldn't take back May's rent that we offered plus deposit and sign the mutual general release but instead they agreed to just a plain termination without getting anything back but deposit.  Only answer I can come up with is that they really think a lawyer is going to take their case or perhaps try to get us in small claims court. 

We've been communicating only in email and text for the past couple of weeks and have only talked to them when twice in person at the house.  We've saved all emails and backed up all texts.  All of which have shown them to be unreasonable jerks.  I did some more research and it looks like in Colorado you can charge them a reasonable amount for the time it takes us to clean and repair which we definitely will do and if they're not ready for a final walk through(which apparently we aren't required to do) then they don't get one after May 31.  I do like your idea about doing an inspection without them present though.