Advice on collecting rent from previous owner

[Ben Welch]

Hey BP! I’m looking for some advice on a recent buy and hold purchase in Memphis. On March 3rd, I closed on 8 units (4 duplexes next to each other) after a long negotiation process. Our first offer contained a special stipulation that read “Rent to be pro-rated at closing” even though the contract also has a prorations clause. When the seller countered our offer they left that special stipulation out. I didn’t think much of it because we still had the prorations clause in the contract. The closing agent then told us that we would need to collect March rents after closing and that she would not be prorating any rents. I should have pushed back on this but didn’t unfortunately – lesson learned.

Rent for March is about $3,100 and the seller had already collected by the time we closed. The seller’s argument is that since the special stipulation was added then removed, that means the standard prorations clause no longer applies. I don’t agree with that logic. I am considering taking the seller to small claims court but am out of state so it would not be very easy.

Has anybody dealt with this before or have any thoughts on whether my interpretation of the contract is correct?