State Specific Question About: WISCONSIN (WI)

If you have entered into an executed signed contract/lease with the new tenant and are unable to deliver possession on the date stated in the contract for what ever reason

You are in material breach of the contract, you would be liable for any and all reasonable cost to the new tenant for your breach

" If you have entered into an executed signed contract/lease with the new tenant and are unable to deliver possession on the date stated in the contract for what ever reason ...You are in material breach of the contract, you would be liable for any and all reasonable cost to the new tenant for your breach "

In CA, as in most populous states, this matter has come up to the courts over and over, and they have developed principles on how it should be dealt with.

Usually, the following occurs:

The incoming tenant is entitled to be released from any responsibilities on his part, and to refund of any money he has put forward.

The outgoing tenant is required to vacate immediately, but of course, if he must be compelled to leave, it will take time.

A good lease would indemnify the landlord from responsibility for this fiasco, and specify exactly what rights incoming tenant may have or not have. The indemnification should protect the landlord from responsibility because he did not cause the problem.

Courts usually do not punish the outgoing tenant for failing to leave on time, even though it was his responsibility. They usually take the position that there is no sense in making judgments that cannot be enforced.

You said "YOU (to the landlord) are in material breach of the contract, you would be liable for any and all reasonable cost to the new tenant for your breach "

A good lease would keep the landlord out of the chain of responsibility by putting the responsibility on the tenant who will not leave. A good lease drafter would make the promise of possession dependent on the acts of other parties over which the landlord has no control.

With the lease being properly drafted, how can the tenant revoke the contract based upon their change of circumstance?

Like a good woman, a good lease is hard to find. My own opinion is that Association-drafted leases are often prepared by young attorneys with minor educations who are looking for a way to embellish their professional qualifications and gain clients when they volunteer (often gratis) to Associations. For me, I think that the best lease would be by a talented, well-qualified attorney, who talks to the landlord to find out his problems, and can think for himself to devise solutions to problems that really cover what has to be solved.

Based upon your post, you may lack these skills in EFFECTIVE lease-drafting.

I have several properties in WI. I put some of this language in the lease, as a notification/reminder to tenants. Note the part about "...the landlord may recover as minimum damages twice the rental value apportioned on a daily basis for the time the tenant remains in possession."

Perhaps if you inform the tenant of this, he will be more inclined to move on.

Section 704.27 Wisconsin Statutes:

Sue,

Thats a good statute, but it means that the landlord has to wait to be sued by the incoming tenant (which may be substantially more than 2 times the rental value for the days that the outgoing tenant holds over), then turn around and sue the outgoing tenant for reimbursement. In the interim, do you suppose the outgoing tenant will still be available? The "any and all reasonable cost to the new tenant for your breach" will generally not be available to either the landlord or the outgoing tenant at an eviction hearing.

I say, better is to keep the landlord out of it.

I think the first problem is Jim's entering into a new lease before he has possession of the property. I don't do that.

I also do not make my new lease contingent on the existing tenant moving out and surrendering the property to me in move-in condition. I rarely get the property returned to me in move-in condition, and so I never assume that it will be in move-in condition.

Most of the time, my tenants do move out on time, but we have probably all experienced at least a few times when the tenant has not moved out as noticed -- the escrow for the close of his newly purchased house is delayed, or there is unexpected work needed before he can move in, or he got sick and can't move or ....

I prefer to avoid all of that drama and anxiety.

Mike, your strategy certainly has merit. But maybe its not optimal.

You are correct that the basic problem is that a tenant may not get out on time. But on one hand, if tenant DOES get out on time, LL has new tenant lined up, wants tenant to move in what? on short notice? How short? 24 hours? Both LL and incoming tenant need to make plans. When someone agrees to rent a dwelling, he needs to know if he securely is going to be the new tenant, needs to plan about terminating his present accommodations, hire a moving company, day off from work to move, establish electricity, satellite or cable, internet, new address, line up friends to help, etc. He needs a signed lease, and a date to move in. When I am going to have a turnover, I KNOW the condition of the property, I know how much work needs to be done, I can agree on a date for property to be available and tenant can move in. What I cannot control is old tenant leaving on time, despite best-laid plans. I cannot be responsible for what I cannot control, so my legal-framework document needs to set out the conditions that I need to be kept uninvolved in the liability dispute.

That way, no drama or anxiety either, I am protected from liability from breach of contract, and if I lose the incoming tenant, then CA law regarding breach of lease (re-cast a few years ago into contract format) allows me to charge incoming but defaulting tenant rent until I find a new incoming tenant.

My suggested strategy scoops up more marbles.

So the current tenant won't move? Did you speak with them as to why? I would immediately serve them for holdover as quickly as you can and get into court so you can physically remove them.

Apologize to the tenant moving in - see if there is anything you can do to "keep it alive" - if not then I would just hand them their money back. I would also SUE the current tenant for that amount in small claims (if you aren't allowed to do so in landlord tenant court).

Jim,

Here's my real world answer, not legal theory.

This USUALLY works.

1. Talk to them. Find out what's going on with BOTH parties.

Exiting res - can he be persuaded to speed things up? Help him move out? Cash for Keys?

New res - can you wait a few days?

2. Lease: mine says "Holdover rent is $70 per day" (motivation)

and

3. Never gives a firm move in date in advance. NEVER promise someone ANYTHING based on the actions of another person outside of my control.

4. WI has some strange LL laws. If you cannot work this out between the old and new res, get advice from someone with local court knowledge.