What can I legally fine tenants for?

Question

I know, that Subject question sounds kind of nasty, but I'm really a pretty nice landlord. However, I have some ongoing issues with some tenants, and I'm wondering if I can add a fine to their lease. (I'm in California.)

I know it's legal to charge a fine for late rent, but can I charge a fine for other lease infractions that I don't deem serious enough (yet) to kick the tenants out? In particular, given that my Pet Agreement states that the tenant will quickly and safely dispose of all pet waste, may I legally add a $25 fine for each time I catch them leaving pet waste on the ground?

(This is, by the way, a multifamily property with no private yards, so any pet waste becomes everyone's problem--and these folks really like to write their own rules on the matter.)

Thanks for any enlightenment you can offer--and happy holiday!

Account Closed · Answer

Hi Carol,  Hey, it was a great beer!  A new brewery opened up in Crescent City - Seaquake Brewery and their opening day was yesterday.  They were slammed!  Hope they're successful.  They fixed up a dilapidated old huge fish market that was all boarded up.  So nice to see it be transformed into a hip, classy place.

Well, as with any tenant issues like fees, etc., they would have to be savvy and actually sue you over it.  Most don't.  But, if you wanted to do things by the book, then yeah, the late fees are supposed to reflect your actual cost.

Back to your original question - I haven't been able to find anything about fining tenants in CA specifically.  I do know that if it's not in the lease, you couldn't do it anyway, even if it's legal to put it in the lease.

But, in CA, you couldn't tack on fines to the rent owed if you were to evict for nonpayment of rent.  You can only list rent owed on the eviction in CA.  And, you're restricted as to what you can deduct out of the security deposit, which would not include fines.

So, collecting them would be an issue anyway.  And if you sued them for fines owed, it's my opinion you'd have to justify the fines as they would relate to actual damage.  They'd be, basically, a liquidated damages clause - which are normally reserved for situations that you both agree would cause damage - but it's too hard to determine an actual amount.  So, of course, there would have to be some damage (which could be physical damage to the property or money out of your pocket somehow).

So, I'm guessing I read some paper on the above, and it was therefore recommended not to put fines in your leases.  But, my old brain can't remember where I read it :-)

Account Closed · Answer

Great book, isn't it?  The Nolo books are the best law books out there, in my opinion, because they're written in a way that's easy to read and understand.  Hmmm, I guess I learned about the CA laws on fines somewhere else.

The way CA law handles fines, is that it says that you can't collect any non-refundable fees of any kind, no matter what you call them.  Any money you collect must be refundable, and will be considered part of the deposit.  So, it's probably under the security deposit law section.

You might also find a reference to late fees - which will say that they must reflect your actual out of pocket losses, and can't be used as a penalty.

Here's the CA Dept of Consumer Affairs web page that explains that late fees must be reasonable and reflect your out of pocket expenses - that they can't be used as a penalty:

http://www.dca.ca.gov/publications/landlordbook/li...

If I can find a better resource later, I'll post it.  But, hey, it's time for a beer!  On my way to have a beer with a friend at the 4th of July bash :-)  Happy 4th!

Account Closed · Answer

Carol, get this book.  It's easy to read, has all the forms you will ever need in CA, including great contracts.  I like their contracts better than the CA Apt. Assoc. contracts.  it was my bible while managing 25 units for 8 years in Santa Clara:

http://www.nolo.com/products/the-california-landlo...

When I got the link for you, I saw that they're having a 40% off sale for the 4th of July weekend.

As far as fines - in CA, you can only legally get away with fines that are your actual out-of pocket expenses.  For anything.  So, if your tenant balks at a fine and decides to bring it up in court, whether that be over a security deposit or an eviction, etc. they will win, unless you can show the judge that your fines reflect actual out-of-pocket losses.

As far as tenants who want dogs who have not been responsible in the past - why?  Why would you want to keep these tenants?  Why would you think they'd behave differently?

I liked month to month agreements.  If a tenant becomes a problem, you just give them notice.  You don't have to give them a reason in CA, unless you're dealing with rent control.

You're not required to keep any tenants.  So, I think you need to re-think your attitude regarding the tenants who want a pet but who have been bad about cleaning up after a pet in the past.

How I'd handle them is - Nope, no new dog.  And I'd probably give them notice to move at the end of their lease, and I'd never sign another lease with them again.  Month to month only.

It just makes way more sense to find tenants who aren't problems, rather than try to come up with fines, etc., to try and make bad tenants into good ones.

Carol Venolia · Answer

Thank you so much, @Sue Kelly! I do have that Nolo book, but I wasn't successful in finding information about fines in it, so I really appreciate the input that a fine must represent actual out-of-pocket expenses. I suppose I could hire a poop-scooper and add that expense to the rent, but, yeah, these folks find ways to make trouble no matter what.

My lease is a six-month lease that automatically rolls over into a month-to-month lease when the six months are up--and they've been there for a year and a half. So that's not a problem.

Thanks again for the info and the encouragement!

Account Closed · Answer

I have no great respect for attorneys.  Just make sure to take with you to the attorney meeting, the actual laws that are relevant.  They'll probably say they have to get back to you and look busy, to save face, but hopefully, their egos will at least allow them to actually look at the laws.

Best of everything to you :-)

Account Closed · Answer

What a twit!  You could give them a 3 day notice to cure or quit.   Then, offer them the option of signing a new lease.  The new lease will require two months rent for deposit (assuming you don't have 2 months rent already).  This would not be a separate pet fee or pet deposit, (which can limit how you can use it) but would max out your regular security deposit per what's allowed by law.  Nope, it's not a pet fee.  Either the dog is out in 3 days, or we have a brand new lease with brand new terms - in 3 days, which will include 2X rent security deposit, which is your requirement for tenants who have pets.

She's probably thinking she'll get out of a pet fee, since they're not legal.  But, asking for two months rent deposit is perfectly legal.  That's what I'm thinking I'd do.

In fact, I think I'd change the length of the lease, too.  Maybe make it a month to month.

Let's turn the "control" tables around on this little know-it-all :-)

Henish Pulickal · Answer

I have a rental with a rooftop near the beach that is perfect for parties.  My only rule for the renters is "don't piss off my neighbors," which I've explained to them means, no noise outside after 10PM.  Could I charge a fine if they are partying outside after 10pm?  Rent is $4,500/month, so the fee would have to be significant, like $500.

Carol Venolia · Answer

Thanks, @Sam Shueh! Unpleasant stuff!

Sam Shueh · Answer

If the pets are there. Make a lease to include them and charge a $50 deposit or let them vacate.  I have a home the unauthorized puppy urinated through the sub-floor.  The tenant was 1 month late. I just let them go, after a Xmas extension.

Since then I have replaced the carpet.Two carpeting 5 years later. But it still smells.

Carol Venolia · Answer

LOL, thanks for the tips, @Sue Kelly!

What can I legally fine tenants for?

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