RICHARD VIERRA (B), RMP
Principal Broker & Director of Property Management
Hawaii Reserves, Inc.
National Association of Residential Property Managers
Regional Vice President / Past President, Oahu Chapter
Q. I signed a lease with the owner of a home in Hawaii a couple of weeks ago to move myself and my family there. Along with the lease fully executed by me and the owner, I paid the rent and full deposit in a cashier’s check.
I have purchased airline tickets and scheduled movers. I just got a call from the owner saying they changed their mind and the home will not be available for rent. What can I do?
A. Unfortunately, this situation occurs quite often, perhaps not in such an extreme manner, but often enough to be a concern. In some cases, a landlord simply changes his mind and returns the deposit with an apology, and in other cases a landlord goes as far as to assist in locating other accommodations for a tenant. More times than not, the tenant is moving locally and has not incurred the cost of airline tickets, transportation costs, and other costs and obligations associated with an interstate move. But for the sake of addressing an extreme case as stated here, the Landlord/Tenant Code (Hawaii Revised Statutes) Chapter 521 is reasonably clear on how this tenant is required to pursue what the law calls a “remedy” for what has occurred.
In HRS Chapter 521, Section 61 (a) (3), a tenant with a signed rental agreement, of course, does not have to pay for what he or she does not enjoy, and can equally notify the landlord that he or she is terminating the rental agreement. Additionally, the tenant is able to secure “adequate substitute housing” by reasonable methods such as online or in-person searches. These costs, and those associated with a new search for housing are recoverable in the District Court.
Initially, it is assumed that alternate housing could be available and that the tenant would arrive anyway, so the reimbursement of travel expenses and movers is questionable. The key term here is “adequate substitute housing,” in that a common sense approach must be taken when the new search begins. For example, if the initial rental unit was a single wall, 1,200 square foot, 3 bedroom unit in an urban core neighborhood, the tenant cannon seek relief and damages for a new rental unit which is 2,400 square feet and has 5 bedrooms in an affluent gated community.
Ultimately, there is a responsibility given to the tenant to mitigate the potential loss by doing his or her part in seeking an alternative. Conversely, there may be a confluence of events that makes locating alternative housing difficult, so it would behoove the landlord to also take some responsibility here. If circumstances were beyond the landlord’s control in failing to provide the housing, the right thing to do would be to return the deposit and first month’s rent and to assist in locating something for the tenant, or at a minimum referring the tenant to other rental sources. But this notwithstanding, the landlord is responsible for ensuring that all monies paid by the tenant for housing that was not provided are returned, and may very well be responsible for monies spent and costs incurred by the tenant to search for and secure what HRS 521 calls “adequate substitute housing” through the judicial system of the District Court.
Answers to questions in Landlord Tenant Q&A are provided by members of the Oahu Chapter of the National Association of Residential Property Managers (NARPM), an organization that supports the professional and ethical practices of rental home management through networking, education, and certification. The Oahu Chapter, founded in 2004, has become the largest in the nation with 175 registered members.
Disclaimer: The answers provided in this column by Realtors address individual cases and should not be construed as interpretations of the law. For specific information on Hawaii State Law, go to http:// hawaii.gov/ dcca/areas /ocp/ landlord_tenant or contact an attorney.