Legal Question in Real Estate Law in California
I hired a local property mgmt firm to find a renter for an apartment I own. They did this same service for me last year with great satisfaction. The contract I signed provides an initial $500 fee and then 6% of the first years lease upon successful execution of a lease. They do the ads, showings, credit screens and lease execution. Over the past four days someone saw the place on Friday and expressed great interest. The propert mgmt firm told me of this on Friday � I gave them a price I was willing to go down to. On Sat morning I got a text from the current tenant saying the prospective tenant had come back to look at the apartment again and was very interested but was unable to get ahold of the property mgmt firm. Upon receiving this text I called the property management firm on Sat morning and did not get an answer - so I left a voice message and also sent an email. Then I called the prospective renter and explained that I was interested in having her rent assuming the price and credit was acceptable - she verbally confirmed the agreed on a rental price. I told her that she still needed to work with the property management firm to do the credit check, fill out the deposit and lease agreement. And if she was not able to get ahold of the property management firm by mid to late Sat afternoon to please call me back. The prospective tenant texted me and left me a voice message at 3:30 on Sat saying she still had not gotten ahold of the property mgmt firm and needed to make a decision in the next hour. Upon getting these messages I called the Property management firm again and again got voice mail. But 2 minutes later the property management firm called me back. I explained the situation and the property management firm said they would call the prospective tenant immediately. Approximately an hour later I got a call back from the property mgmt firm telling me the prospect wanted to decrease the proposed rent by $100. I told the property management firm to stick to the previously agreed price - and if the prospective tenant declines this then to move on and seek another tenant. I have not heard from the property management firm since this conversation (it is now Monday mid day). Later Sat evening while I was out at dinner the prospective tenant left me a voice mail saying that the property management person was very rude to her and while she wanted to rent the place she would not execute a contract with the property management firm involved. When I got this message very late on Sat night I sent an email to the property mgmt representative requesting that they call me first thing on Sunday. As I stated I have not heard from the property management firm since. I also investigated and found that the advertisement on Craigslist was not up on Sat (the most popular day for looking for a rental apartment). My questions are:
1) Has the contract between myself and the property management firm been breached - from my point of view it obviously has
2) I have stopped the $500 initial check payment to the properrty mgmt firm - can I assume because of breach of contract this $500 is no long due.
3) If I should not find another renter for the month of May and it is thus vacant - can I sue for the lost rental damages?
1 Answer from Attorneys
Unfortunately, without reading the rental listing agreement you signed with the property management company, it is not possible to render an opinion as to anybody's breach of the agreement. My first concern is that your expectation that a property manager would be available on a Saturday with immediate response time may be a little off the mark. Most management companies I have worked with are open Monday through Friday, and while they attempt to make themselves available on weekends, it is not the norm in my area for management companies to be open or available 24/7. I would not say that the agreement has clearly been breached - if you told the management company to stick to your price, and the prospect insisted on lower rent, then the agent was simply following your instruction in not executing a lease with the tenant. Again - communicating with you on a Sunday might be expecting too much. As an aside, so you do not think I am speaking from a lack of experience, I owned and ran a successful managment company for years in Orange County.
You need to have an attorney in your area review the agreement to determine if the breach was sufficient to allow you to terminate the agreement. I will warn you, however, that once a listing agreement is signed, agents are often entilted to their commission even if you rent the property.
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