Tenants want to counter sue for damage they did not report

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Tenants want to counter sue for damage they did not report

Real Estate Investor · Fenton, MI · Member since 2008 · 946 posts · 153 votes

After my tenants finally left we found extensive damage to the floor from their dog urinating on it plus scratches from moving furniture etc. The damages exceed their deposit and I have sent them a letter stating we are keeping the entire deposit and they owe us about $3000.00. I do not think they are disputing us keeping the deposit, but they do not want to pay anything above that. I received a letter from their lawyer stating that if we sue them they are going to counter-sue us for damages they claim occurred to their property that has “black mold” from being stored in the basement. When they stayed there they never complained verbally or in written form as our lese requires about mold in the basement or any damage to their property. The lawyer claims they have pictures.

When they were there they crushed the gutter downspouts when they mowed the lawn and they had a tremendous amount of clutter in the basement. I never saw the basement flood, but there were some humidity problems in the basement. What do you all think of their lawyer’s threat?

As always, thank you to all who give their learned advice.

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Rental Property Investor · Northern, CA · Member since 2012 · 5k+ posts · 5k+ votes

Sounds like they are trying to scare you into not coming after them for what they owe.

See this reply in the discussion

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Kyle J.
Rental Property Investor · Northern, CA · Member since 2012 · 5k+ posts · 5k+ votes
13y
Sounds like they are trying to scare you into not coming after them for what they owe.
1 Reply
Account Closed
Property Manager · Big Bear Lake, CA · Member since 2013 · 585 posts · 330 votes
13y
Lawyers always start out by sending a letter trying to scare you off. Since your lease states that they have to notify you in writing of problems in the home, ask them to show you proof of that writing.

I would take them to small claims court for the $3000, or whatever the limit is in your state. No lawyers are involved. If they counter sue you, just make sure you have before and after pics of the damage.
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Ace A.
Las Vegas, NV · Member since 2012 · 75 posts · 3 votes
13y
If they didn't complained verbally or in written form about the mold, that shouldn't be an issue. If anything, I would think you could come after them for the mold issue on top of the others since they were negligence.

Like Kyle Said, I think they are just trying to scare you. Hedging their bet by paying an attorney $100 to write you a letter instead of paying you $3000.

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Joel OwensBusiness Member
Moderator
Real Estate Broker · Canton, GA · Member since 2010 · 15k+ posts · 11k+ votes
13y
Hi Steve,

Before you pursue the tenant you need to know "How collectible are they even if you win a judgment ??"

The attorney will take money from you all day long to send paper back and forth.

Most judgments are worthless. The question is how much time do you want to put in and disrupt your life for the anticipated return??

Many investors just move on from these types of instances and it's all a crap shoot when you go to court what judge you will get and how sympathetic they will be to you the landlord or the former tenant. I have brought all the facts before a judge and they gave me everything against the tenant and another time the judge felt sympathetic for the tenant even though they had no leg to stand on.
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Mark Forest
OP
Real Estate Investor · Fenton, MI · Member since 2008 · 946 posts · 153 votes
13y
Originally posted by Joel Owens:
Hi Steve,
Before you pursue the tenant you need to know "How collectible are they even if you win a judgment ??"

This particular house was very nice and the rent was the highest I charge so they both have decent jobs, and I know where they work.

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Jon K.
Member since 2011 · 798 posts · 216 votes
13y
Originally posted by Michelle L:
Lawyers always start out by sending a letter trying to scare you off. Since your lease states that they have to notify you in writing of problems in the home, ask them to show you proof of that writing.
I would take them to small claims court for the $3000, or whatever the limit is in your state. No lawyers are involved. If they counter sue you, just make sure you have before and after pics of the damage.

They've lawyered up already. I would too.

It does sound like the lawyer is trying to scare you off. I would want proof that they notified you of mold in the basement.
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Mark Forest
OP
Real Estate Investor · Fenton, MI · Member since 2008 · 946 posts · 153 votes
13y
Originally posted by Jon K.:
Originally posted by Michelle L:
It does sound like the lawyer is trying to scare you off. I would want proof that they notified you of mold in the basement.

They never did send me anything on that. Actually ANY time something was broken we discoveed it.
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Rob K.
Investor · Southeast, MI · Member since 2012 · 2k+ posts · 1k+ votes
13y
Is there any mold in the basement currently? If not, what "pictures" could they have?

Often times in a basement, you will get a mildew on the walls. The black mold is usally on drywall or the wooden ceiling. It only grows on organic materials and needs lots of water.

Also, there are thousands of different types of mold and only a handful are harmful.
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Mark Forest
OP
Real Estate Investor · Fenton, MI · Member since 2008 · 946 posts · 153 votes
13y
Originally posted by Rob K:
Is there any mold in the basement currently? If not, what "pictures" could they have?

That is a good point Rob. The basement is mostly finished tile. For all I know they spilled water on their own property. In their dumpster I saw pieces of cardboard with black stuff on it.

By the way, they moved out 5-17-13 and I sent them the letter about 20 days later saying I was keeping their deposit plus they owed me more and they had seven days to respond. Their attorney answered me after the seven days. I am just wondering how long I have to sue them. Is it still 40 days from move out even though the deposit does not seem to be an issue?
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Mike Franco
Los Angeles, CA · Member since 2013 · 555 posts · 261 votes
13y
That black mold defense is so silly. I chuckle every time I hear it.

I would respond in jest to the attorney with pictures of typical bathroom shower wall mold, and ask him if he would countersue based on shower mold.

In california, if they want to claim black mold, they have the burden of getting it tested for black mold by a licensed lab at their expense.

PICTURES are not sufficient.

Tell the attorney to "bring it on."
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Nicole A.Pro Member
Rental Property Investor · Baltimore County Maryland and Tampa Florida · Member since 2013 · 2k+ posts · 2k+ votes
13y
Bringing this topic "back to life" with a somewhat related question...

If your LLC has a Promissory Note with an individual and that individual has flat out refused to pay and told you they won't pay, when the LLC goes to small claims court, must all members of the LLC attend?
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Matthew Paul
Severna Park, MD · Member since 2013 · 7k+ posts · 7k+ votes
13y
I may be wrong , but I believe that any corporation must be represented by an attorney ,not the person or people who own the corporation .
1 Reply
Nicole A.Pro Member
Rental Property Investor · Baltimore County Maryland and Tampa Florida · Member since 2013 · 2k+ posts · 2k+ votes
13y
Possibly in some states, but I'm fairly certain I read that it's not required in MD...and this info came from the state site. I'm just not sure if they require all members to go to court or if just one person from the LLC will suffice.
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Steven Hamilton IIPro Member
Accountant, Enrolled Agent · Grayslake, IL · Member since 2011 · 5k+ posts · 2k+ votes
13y
Originally posted by Matthew Paul:
I may be wrong , but I believe that any corporation must be represented by an attorney ,not the person or people who own the corporation .

@Matthew Paul ,

That is true for some states; however, not true for all.
[email protected]224-381-2660
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Stephen Masek
Investor · Mission Viejo, CA · Member since 2012 · 627 posts · 204 votes
13y
In which state? Can you just go to small claims court, where no lawyers are allowed?
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Nicole A.Pro Member
Rental Property Investor · Baltimore County Maryland and Tampa Florida · Member since 2013 · 2k+ posts · 2k+ votes
13y
No lawyers "allowed"? Doubt that....? It's an option to have one. In MD I'm pretty sure you don't need a lawyer for small claims (even as a business).
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Account Closed
Dallas, TX · Member since 2013 · 4k+ posts · 744 votes
13y
In Texas no lawyers allowed in small claims court.

Joe Gore
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Account Closed
Dallas, TX · Member since 2013 · 4k+ posts · 744 votes
13y
Steve,

The only thing you need to worry about if they have pictures of the black mold or their friends show up as witness that they saw the black mold it could cost you more then the little old deposit you are keeping. If they went to a doctor and the doctor said they are sick from mold it will cost you big time. I suggest you move on and be happy they are no longer there.

Joe Gore
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Tina McNeely
Dallas, TX · Member since 2013 · 2 posts · 0 votes
13y
Originally posted by Joe Gore:
In Texas no lawyers allowed in small claims court.

Joe Gore

I'm sorry, but that's just not correct. "Small Claims Courts" are now known as Justice Courts. They've changed things to be a lot more casual and to allow for more common sense rulings, in order to prevent individuals from getting run over by lawyers using "tricks" but companies or people may still hire attorneys to represent them.

The new rules:

RULE 500.4. REPRESENTATION IN JUSTICE COURT CASES

(a) Representation of an Individual. An individual may:

(I) represent himself or herself;

(2) be represented by an authorized agent in an eviction case; or

(3) be represented by an attorney.

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Mark Forest
OP
Real Estate Investor · Fenton, MI · Member since 2008 · 946 posts · 153 votes
13y
Small claims court is almost useless if your opponent has a lawyer. They can simply say they want representation and the judge will adjourn it to a regular court where it will be you and your attorney verses theirs. Of course you will have to pay your lawyer big dollars to do this.
1 Reply
Nicole A.Pro Member
Rental Property Investor · Baltimore County Maryland and Tampa Florida · Member since 2013 · 2k+ posts · 2k+ votes
13y
It's frustrating because it's so easy for people to screw you over and not pay rent or not pay a small Promissory Note. There's no reason for people to be honest unless they're truly a good person...

I have a small Promissory Note with former renters and they basically said "do you really think we're paying that"? I could go to court, out of principle...and to try and recoup some of my money, but at the same time, it's a small amount to fight for...it's just so angering.

It's like we're just pretending that these contracts mean anything.
1 Reply
Mark Forest
OP
Real Estate Investor · Fenton, MI · Member since 2008 · 946 posts · 153 votes
13y
Originally posted by Nicole Williamson:
It's like we're just pretending that these contracts mean anything.

That is exactly right. The same is true of adding particular clauses to leases. The tenants will still do what they want because the courts do not hold them accountable. Judges often act like written agreements mean nothing.
1 Reply
Matthew Paul
Severna Park, MD · Member since 2013 · 7k+ posts · 7k+ votes
13y
Tell them you will 1099 them for the money owed . Then tell them that you have contacted the IRS and the amount owed plus fees will be deducted from their tax return automatically . And that they will probably have to refile their taxes .

It works every time . Just have on a good poker face .
0 Reply
Account Closed
Dallas, TX · Member since 2013 · 4k+ posts · 744 votes
13y
Matthew,

What you are saying can cut both ways the tenant can 1099 the landlord for the deposit owed.

Joe Gore
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Steven Hamilton IIPro Member
Accountant, Enrolled Agent · Grayslake, IL · Member since 2011 · 5k+ posts · 2k+ votes
13y
Originally posted by Joe Gore:
Matthew,
What you are saying can cut both ways the tenant can 1099 the landlord for the deposit owed.
Joe Gore

@Account Closed ,

@Matthew Paul ,

You can threaten it yes; however, you have no financial reason to 1099 them. If a tenant were to 1099 you(which would be stupidity on their party). 1. they shouldn't have your EIN/SSN to 1099 you 2. Most aren't savvy enough to do that.

If a tenant were to do that, all you would have to do is show the IRS your contract and the bad relationship with the tenant leaving by using written documentation and it should be a slam dunk.
[email protected]224-381-2660
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