Can I sue my Ex-Property manager for gross negligence?

General Landlording & Rental Properties
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Can I sue my Ex-Property manager for gross negligence?

Glenda Barden
Member since 2018 · 12 posts · 1 vote

I had a property manager fail to get a signature on the lease of every person over 18 living in my rental property. I have an email sent to me by the owner of the property management company asking me if I wanted anyone else on the lease and I replied, "Yes, I would like everyone living in the house over 18 on the lease". 


Before we were able to get them out of the house, the tenants failed to pay 5 months rent, they left unpaid utility bills, they had a tree cut down and they caused over $10,000.00 worth of damage to my house.

I tried to sue all 3 of the adults in the house, but I was only able to go after the 1 person who actually signed the lease, although all 3 of them are listed as tenants and the other 2 are listed as occupants as well.

Because the property manager did not get their signatures as I had requested,

1. Can I sue my Ex-Property manager for gross negligence?

2. Can I sue them for the portion of monies owed to me by the 2 people they did not get signatures from?

3.  Can I sue the property management company and the 1 Ex Tenant who signed the lease each for half cost of lawsuit?

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Russell BrazilBusiness Member
Moderator
Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
7y

Anyone can sue anyone for just about any reason. That does not mean that people are successful in that pursuit. There is no way anyone would be able to provide you with an idea of whether you would be successful in your suit with the information you have provided.

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  • Christopher Phillips
    Real Estate Agent · Garden City, NY · Member since 2016 · 3k+ posts · 1k+ votes
    7y

    @Glenda Barden

    Welcome to BP.

    You should speak with a local lawyer about it.

    Did you get a signed copy of the lease and review the signatures? Most prop managers will forward you the final copy once it's signed by the tenants.

    1Reply
  • Russell BrazilBusiness Member
    Moderator
    Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
    7y

    Anyone can sue anyone for just about any reason. That does not mean that people are successful in that pursuit. There is no way anyone would be able to provide you with an idea of whether you would be successful in your suit with the information you have provided.

    [email protected]301-893-4635Podcast Guest on Show #192
    District Invest Group545 Reviews
    WebsiteView Page
    5Reply
  • Bill Cassell
    Springfield Missouri · Member since 2018 · 7 posts · 5 votes
    7y

    I'm not an attorney But I have had my fair share of lawsuits  Just like Russel said above anyone can sue anyone for anything. but you are looking at a 10k-15k loss   it will cost more money to sue them than that. if they are good at being sued it will take up to 2 years to finish the suet and you might just loose, then you would have spent 20k + on top of your lost rent and damages.  and I agree with Russell   

    (There is no way anyone would be able to provide you with an idea of whether you would be successful in your suit)

    As mad as I would be about this. I probably would not file a law suit.  

    3Reply
  • Matt K.
    Walnut Creek, CA · Member since 2015 · 3k+ posts · 2k+ votes
    7y

    What's the contract say...

    0Reply
  • Glenda Barden
    OP
    Member since 2018 · 12 posts · 1 vote
    7y
    Originally posted by @Christopher Phillips:

    @Glenda Barden

    Welcome to BP.

    You should speak with a local lawyer about it.

    Did you get a signed copy of the lease and review the signatures? Most prop managers will forward you the final copy once it's signed by the tenants.

    Yes, I got a copy of the lease, however, it lists all the adults as tenants as well as occupants.  But only one of them signed the lease.  I really didn't know if they all had to sign because all their names are listed on the lease as tenants.  I didn't know anything about making sure all their signatures were on there or if it would be an issue now because I left all that up to my property manager.

    0Reply
  • Glenda Barden
    OP
    Member since 2018 · 12 posts · 1 vote
    7y
    Originally posted by @Matt K.:

    What's the contract say...

     Which contract?  

    0Reply
  • Matt K.
    Walnut Creek, CA · Member since 2015 · 3k+ posts · 2k+ votes
    7y

    All the ones you signed

    0Reply
  • Christopher Phillips
    Real Estate Agent · Garden City, NY · Member since 2016 · 3k+ posts · 1k+ votes
    7y

    @Glenda Barden

    it's still your responsibility to check. All of the people that sign should be at the bottom of the lease and any addendum sheets.

    Did you speak to your insurance company about covering for the physical damage?

    0Reply
  • Glenda Barden
    OP
    Member since 2018 · 12 posts · 1 vote
    7y
    Originally posted by @Matt K.:

    All the ones you signed

    Well I signed an agreement with the property manager for them to manage my property.  It's a basic management agreement between me the home owner and the property management company.  

    Is there something specific it might say that could make a difference to sue or not?

    0Reply
  • Glenda Barden
    OP
    Member since 2018 · 12 posts · 1 vote
    7y
    Originally posted by @Christopher Phillips:

    @Glenda Barden

    it's still your responsibility to check. All of the people that sign should be at the bottom of the lease and any addendum sheets.

    Did you speak to your insurance company about covering for the physical damage?

     I really didn't think to double check after they asked me what I wanted and I told them what to do

    Here's part of the email they sent me:

    1.Will anyone else be named on the lease? (spouse or children?) Yes, I would like eveyone over 18 to be on the lease

    I mean I really thought I was good to go with this company that has been doing this for years, but they really dropped the ball, right?

    Well, I didn't get my insurance company involved in this, I had a move out inspection and I had the work they noted done.

    0Reply
  • Glenda Barden
    OP
    Member since 2018 · 12 posts · 1 vote
    7y

    Also, when I asked them why they didn't have all 3 of the adults sign the lease, I was told, " I had it on a sticky note that only one of them was going to be held responsible for paying the rent, however, we switched to a paperless system and now I can't find the note".  But, I haven't told them about this email that I found from them yet.

    0Reply
  • Christopher Phillips
    Real Estate Agent · Garden City, NY · Member since 2016 · 3k+ posts · 1k+ votes
    7y

    @Glenda Barden

    that's what insurance is for...

    You have to check those things. If the tenants were trying to dodge the issue and only one person signed, that was your opportunity to hold them to their word.

    You countersigned and they moved in. At that point it's hard to claw it back.

    At the end of the day, only the person that signed is financial responsible for the rent and damage. If the other people were the ones that caused the damage, then the tenant would have to go after them.

    1Reply
  • Glenda Barden
    OP
    Member since 2018 · 12 posts · 1 vote
    7y

    Well, the lease was between the property management company and the tenants, I did not sign it. Because I have a contract with the property management company giving them that authority.

    However, to be clear you're saying that the property managenent company has no responsibilities in failing to get all signatures as I had requested and entrusted them to have my best interest?

    0Reply
  • Christopher Phillips
    Real Estate Agent · Garden City, NY · Member since 2016 · 3k+ posts · 1k+ votes
    7y
    @Glenda Barden You shouldn’t have given them that level of authority. I still review and sign all leases electronically that my property managers send me.
    0Reply
  • Sam Shueh
    Real Estate Agent · Cupertino, CA · Member since 2016 · 4k+ posts · 1k+ votes
    7y

    Lawyer office visit. 

    1Reply
  • Jason BottPro Member
    Insurance Agent · Nationwide · Member since 2014 · 2k+ posts · 1k+ votes
    7y
    Originally posted by @Glenda Barden:

    Well, the lease was between the property management company and the tenants, I did not sign it. Because I have a contract with the property management company giving them that authority.

    However, to be clear you're saying that the property managenent company has no responsibilities in failing to get all signatures as I had requested and entrusted them to have my best interest?

    Glenda, if this PM has an Errors and Omissions (E&O) policy, this may be covered. Ask them if they have a policy, and if they do, file a claim against that policy.

    Having an E&O policy is not required, so many PM's don't carry one.

    2Reply
  • Ray Johnson
    Irvine, CA · Member since 2016 · 545 posts · 614 votes
    7y

    @Glenda Barden I would at least get an attorney consultation.

    While I'm not a lawyer I would point out that there's a difference between having all parties over the age of 18 listed on the lease and having all parties over the age of 18 qualify and sign for the lease of the property. The difference is if the other adults were qualified and had their income used, credit checks, background checks, they were listed on the renters insurance, etc.. that would be a sign that they are actually on the lease and can be held responsible, If they're just listed on the lease like people do when notifying a landlord that a child resides in the property, that means nothing except notifying you that they are residing in the property at the authorization of the tenant and responsible for the lease.

    Like others have stated proving this misinterpretation between you and the PM may be hard to prove in a lawsuit, take a look at how you articulated the ask in your correspondence to the PM, Did you ask for all parties over 18 to be listed on the lease (which it appears they did) or did you ask the PM to qualify and get signatures for all adults over 18 leasing the property? How the ask was articulated will make a big difference.

    1Reply
  • Glenda Barden
    OP
    Member since 2018 · 12 posts · 1 vote
    7y
    Originally posted by @Christopher Phillips:
    @Glenda Barden

    You shouldn’t have given them that level of authority.

    I still review and sign all leases electronically that my property managers send me.

    Thanks for your information.  However, I didn't know that I should have paid them the fee they asked for but, I still had to second guess their professionalism at the same time.  I didn't know how to be a landlord that's why I sort the help of a company I thought would be able to do that for me.  Can you understand that?

    1Reply
  • Stanley Bronstein
    Attorney, CPA, Broker & Author · Scottsdale, AZ · Member since 2018 · 532 posts · 488 votes
    7y

    @Glenda Barden It's not really a question of whether or not you can sue?  It's a question of how strong your case is, what it would cost to file and carry out the suit, whether or not you would be likely to win, how much would you likely recover and whether or not you'd be likely to collect it if you win your lawsuit?

    All I can say is that when you start factoring in the costs of your time, legal fees, brain damage, etc., it's' quite often not worth the trouble. However, that's for you to decide.

    1Reply
  • Christopher Phillips
    Real Estate Agent · Garden City, NY · Member since 2016 · 3k+ posts · 1k+ votes
    7y

    @Glenda Barden

    I totally understand it.

    0Reply
  • Karen Rittenhouse
    Flipper/Rehabber · Greensboro, NC · Member since 2010 · 623 posts · 615 votes
    7y

    @Glenda Barden - Yes, you can sue. The attorney will probably want a retainer fee. Many charge $5000 to start a lawsuit. Check around for a good real estate litigator. Most attorneys will advise you, very few actually go to court.

    If you get to court, expenses will go up. If you win, you will be way behind in expenses. The court may award you court costs, meaning your expenses need to be paid by those you sued. This process will probably take at least 18 months.

    When (if) you win, you will be responsible to collect the winnings from the tenants and the property management company. Good luck with that. Courts do not collect your winnings for you.

    One thing you'll learn as a property owner and a landlord is that you never want to get to court. Even if you win, you really don't.

    I suggest you take everything you learned from this experience and move on to another property management company. It's always important to manage your own properties starting out so you know what to expect from any companies you hire and you can follow up to see that your processes are being followed.

    I'm sorry this happened to you. Learn from it and put it behind you.

    4Reply
  • Stanley Bronstein
    Attorney, CPA, Broker & Author · Scottsdale, AZ · Member since 2018 · 532 posts · 488 votes
    7y

    @Karen Rittenhouse gives good advice.  However, telling the property manager you are considering filing a lawsuit will SOMETIMES get their attention and you can negotiate from there.

    2Reply
  • John T.
    Rental Property Investor · Central U. S. A. · Member since 2013 · 296 posts · 149 votes
    7y

    @Glenda Barden Since every State has different laws, you should change you profile to display at least the State in which your property is located.  That might encourage people who are familiar with your State's laws to respond to your comments.

    0Reply
  • Glenda Barden
    OP
    Member since 2018 · 12 posts · 1 vote
    7y
    Originally posted by @John T.:

    @Glenda Barden Since every State has different laws, you should change you profile to display at least the State in which your property is located.  That might encourage people who are familiar with your State's laws to respond to your comments.

     That's a good idea. Thanks.

    0Reply
  • Glenda Barden
    OP
    Member since 2018 · 12 posts · 1 vote
    7y
    Originally posted by @Karen Rittenhouse:

    @Glenda Barden - Yes, you can sue. The attorney will probably want a retainer fee. Many charge $5000 to start a lawsuit. Check around for a good real estate litigator. Most attorneys will advise you, very few actually go to court.

    If you get to court, expenses will go up. If you win, you will be way behind in expenses. The court may award you court costs, meaning your expenses need to be paid by those you sued. This process will probably take at least 18 months.

    When (if) you win, you will be responsible to collect the winnings from the tenants and the property management company. Good luck with that. Courts do not collect your winnings for you.

    One thing you'll learn as a property owner and a landlord is that you never want to get to court. Even if you win, you really don't.

    I suggest you take everything you learned from this experience and move on to another property management company. It's always important to manage your own properties starting out so you know what to expect from any companies you hire and you can follow up to see that your processes are being followed.

    I'm sorry this happened to you. Learn from it and put it behind you.

     Thank you for your time and insight.

    0Reply
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