Firm Newsletter - June 2016

Tenants are Liable to Landlords for Damages on Rental Property

Photo by KentWeakley/iStock / Getty Images

Photo by KentWeakley/iStock / Getty Images

In 2015, the Texas Supreme Court ruled on the issue of whether public policy should prevent the enforcement of a standard apartment lease provision that shifts the liability for property losses resulting from “any other cause not due to [the landlord’s] negligence or fault[]” from the landlord to the tenant. The Court held that insurance companies and their landlords have a waivable duty to pay for repairs of rental properties which may be enforceable even if fault of the damage is undetermined. In fact, a landlord may hold tenants absolutely liable for repairs to damages not resulting from any of the tenant’s act or omissions simply by citing to the tenant’s contractual agreement to accept such responsibility.

Landlords under Texas Property Code (TPC) 92.006(c) are prohibited, with apparent exceptions, from waiving landlord’s repair duty for conditions “materially affecting the physical health or safety” of an ordinary tenant. However, this is not a statutory duty to repair all conditions, as TPC 92.052(b) explains, without a standard or fault-based language, that landlords do not have a duty to repair damages caused by a tenant aside from normal wear and tear. Therefore, in order for a tenant to a avoid liability for damages, after contractually accepting all liability for damages not resulting from the landlords acts or omissions, a tenant must show facts that allow for the avoidance of the contract’s enforcement.

In Phil. Indemnity Ins. Co. v. White, 2015 Tex. LEXIS 809 (2015), the Texas Supreme Court reversed and remanded the court of appeals’ holding which supported the trial court’s granting of White’s motion notwithstanding the verdict based on the public policy argument that the lease provision is void because it broadly and unambiguously allocates liability beyond the statutorily defined bounds. Although the provision did not incorporate statutory authority The Court reversed the appeals decision on the grounds that 1) enforcement did not necessarily contravene the TPC; and 2) White failed to conclusively establish the facts necessary to deny enforcement.

To avoid enforcement of the lease agreement White must show more than a lack of negligence, a tenant under a similar lease agreement must show they lacked fault. Affirmative defenses may protect tenants only after proving a lack of causation by the tenant, who under 92.053 has the burden when the landlord’s liability is disputed.

Essentially when viewed together TPC 92.052 and 92.053 creates a rebuttable presumption that damages to property under the tenant’s control are caused by the tenant. This means the landlord’s duty under TPC 92.006 is not contravened by the tenant’s agreement to accept responsibility without any showing that the tenant was at fault for the damages. Therefore, without more facts from White, The Court ruled that insurance company should receive the reimbursement sought from White for the fire damage originating from White’s apartment.

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