If you’re a landlord, what should you do if a tenant leaves personal property behind? While the answer may seem simple—just remove the items and move on—there are specific rules to follow, especially if you want to avoid disputes with former tenants or run afoul of the law. Here’s a guide to handling abandoned property effectively.
Follow the Rules, or Pay the Price
State law is clear. You must first provide a notice by mail (to the unit) and wait 18 days for a response. The notice you send depends on 1. Whether the value of the abandoned property is estimated at more or less than $700, and 2. Whether the property belongs to the tenant or someone else (leased or borrowed).
If the value of the abandoned property is less than $700, once the waiting period is over, you can simply throw it away, give it away, keep it for yourself, or sell it and pocket the proceeds. However, it’s best to err on the side of overestimating value. Declaring the abandoned property to be worth $500 might seem reasonable, but if the tenant claims it’s worth significantly more, you could find yourself in legal hot water. The safest route? If the value could be worth more than $700, document everything thoroughly and hold a public auction.
Cutting corners can backfire, especially when the perceived value of the abandoned items suddenly skyrockets. That dusty king-size sleigh bed or the mismatched antique dressers might seem worthless, but if the tenant happens to catch an episode of Antiques Roadshow and discovers that the furniture may have some value, you could find yourself embroiled in a legal battle. The tenant who couldn’t be bothered to dispose of this “junk” suddenly can’t live without their beloved bedroom set.
When Property Exceeds the $700 Threshold
If the value of the abandoned property is more than $700, after the waiting period, you must hold a public sale and send the proceeds to the tenant. During COVID, one of our tenants left behind belongings that were definitely worth more than $700. When I called him, he requested that I sell the items and send him the proceeds. I confirmed this agreement in writing. Since we couldn’t really do estate sales while adhering to social distancing requirements, I hired an estate sale company to appraise the items and provide a written valuation; then I sent him a check. This ensured both an accurate assessment and a paper trail, so the tenant couldn’t argue things later.
Understanding Costs and Proceeds
When a tenant vacates a property and leaves the place dirty and full of their old stuff, it’s understandable that landlords would want to keep the tenant’s whole security deposit and, if there is one, the pet deposit, too, to offset the cost of cleaning and disposal. However, that’s not how it works (legally). Landlords can deduct the cost of cleaning from a security deposit, because that’s what the deposit was intended for. But landlords cannot use the pet deposit to cover additional cleaning costs.
Unless any of the damage was pet-related, the landlord must return the entire pet deposit and send a separate bill for the expenses associated with disposing of any abandoned property. Outstanding expenses can be addressed by sending notices, using a collection agency, or going to small claims court.
The Realities of Small Claims Court
Small claims court might seem like a straightforward way to recover money owed by a former tenant, but it comes with its own challenges. Small claims court is for claims under $12,500, and attorneys aren’t permitted on either side. While this saves on legal fees, winning a judgment doesn’t guarantee payment. Many tenants who owe money lack the resources to pay and pursuing a judgment across state or national borders is often an exercise in frustration.
The Takeaway
By taking a cautious, thorough approach, you can protect yourself from legal challenges and financial losses. The key is to know the legal requirements and follow them—documenting everything along the way.
If you have questions about property management or real estate, please contact me at rselzer@selzerrealty.com or call (707) 462-4000. If you have an idea for a future column, share it with me and if I use it, I’ll send you a $25 gift certificate to Schat’s Bakery.