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Rent it Right

by Janet Portman, Inman News

landlord helpQ: We’re renting a farmhouse from an owner who lives out of state and who inherited the property from an uncle. The owner is not familiar with the property but acknowledged that it needed some fixing up before it was ready for occupation. I’m a contractor by trade, so I offered to do it, and the owner said OK.

He gave us two months’ free rent in exchange for my hours of work and materials. But the cost to do all that was necessary was more than that amount by about $500. Does the landlord have to pay the extra? –Janice J.

A: It’s a shame that you and the owner didn’t anticipate this at the start. In fact, you should have anticipated the opposite result, too — that the cost to do the work might be less than two months’ rent. In that event, the question would be whether the owner could fairly expect you to pay something for those first couple of months.

The key to answering your question lies, first, in the type of work you did on the house. You say it needed “fixing up” before occupation, but you don’t say what had to be done. In every state but Arkansas, it’s the landlord’s responsibility to make the property fit for occupancy (and pay for the repairs necessary to make it habitable).

If the house was uninhabitable before you did the work — with nonfunctional plumbing, a leaky roof or serious structural problems, for example — then the landlord is legally on the hook for the repairs.

Next, we need to know how the two of you arrived at your payment plan. If the owner estimated that the work could be done for two months’ rent, then you could reasonably ask him to pay more when that sum proved inadequate. On the other hand, if you gave a bid for doing all the work necessary to make the home livable but you underestimated the cost, you could fairly be expected to cover the overrun.

What if the work you did was not required to make the home fit for occupation — perhaps you remodeled the kitchen or refinished the floors but the original structure would have passed the “fit and habitable” legal test? In this event, the only question is how you and the owner structured the deal.

Again, if the owner misjudged the cost of the agreed-upon repairs, perhaps he should bear the consequences of his poor planning. But if you bid on the job and just underestimated how long it would take or how much it would cost, you are out of luck.

Janet Portman is an attorney and managing editor at Nolo. She specializes in landlord/tenant law and is co-author of “Every Landlord’s Legal Guide” and “Every Tenant’s Legal Guide.” She can be reached at Copyright 2010 Janet Portman

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