Why I Support Adopting the URLTA Statewide

As everyone who’s watched Kentucky Evictions from A-Z knows, the Uniform Residential Landlord Tenant Act (URLTA) is an odd piece of legislation. It was passed into law by the state legislature, but it only applies in a particular city or county when it is adopted by that city or county’s government. As a result, the URLTA only applies in 19 jurisdictions in Kentucky. For a complete list, check out this article. 

HB 380

Last week, a bill was filed in the state House of Representatives to change that. House Bill (HB) 380 amends the URLTA to make it apply to the entire state, and prohibits local governments from adopting any ordinance that relates to any subject covered by the URLTA. It’s still early in the process for HB 380, but landlords need to figure out immediately where they stand on expanding the URLTA statewide in order to either support or protest HB 380 as it moves through the legislative process. Click here for a current version of HB 380.

History of the URLTA in Kentucky

HB 380 is the 2016 iteration of a movement that has been in the works for years. The URLTA was first enacted in 1974. At that time, the law was written such that it only applied in Jefferson County and Fayette County. It remained in effect as such until 1983, when the Kentucky Supreme Court struck down the URLTA in the case of Miles v. Shauntee, 664 S.W.2d 512 (Ky. 1983) as unconstitutional “special legislation” because it only applied in two of the state’s 120 counties.

In response, the state legislature re-enacted the URLTA the following year, this time making it available for adoption in its entirety by any local government. As noted, 19 jurisdictions went on to adopt the URLTA in its current form. Click here to find the URLTA in its current form. As I noted in an earlier blog post, while only 19 of the 120 counties and 420 cities in the state have adopted the URLTA, the largest population centers have adopted it. Further, there has been a push through the years to adopt it in other cities, such as Bowling Green, and statewide.

Given that my practice is located near two jurisdictions that have adopted the URLTA (Lexington and Georgetown) and many that have not, I have had to develop expertise in landlord-tenant relationships both inside and outside of the URLTA jurisdictions. From a decade of practice in both jurisdictions, but primarily inside URLTA jurisdictions, I think everyone should support HB 380 for two main reasons: it brings clarity and even-handedness to the landlord-tenant relationship. Here’s what I mean:

It clarifies the rights, remedies, and obligations of the parties. Few laws are perfectly clear, and the URLTA is no exception. There are portions of it that could be written better. However, on the whole, the law is pretty clear as to the rights, remedies, and obligations of landlords and tenants. For landlords with well-written leases, this clarity is less necessary. Unfortunately, there are significant numbers of landlords whose leases are very poorly written, having been downloaded from the internet or borrowed from a friend in the industry. As a result, many landlord-tenant relationships are governed by leases that are contradictory, unclear, or simply silent on major issues such as the amount of notice required to terminate a lease, the maintenance obligations of each party, how notices are to be given, when the landlord may enter the rental unit, when and how a landlord may add or change rules affecting the tenant, when a tenant may terminate the lease, and when a tenant may withhold rent.

When the law is not clear, both landlords and tenants suffer, as both parties need clear guidelines for their relationship in order to make it mutually beneficial. When the law is not clear, the courts have very broad discretion to “fill in the gaps”. Courts use the legal concept of “equity” to fill in the gaps in the law or lease in a way that they believe is fair. Very few landlord-tenant cases get appealed to higher courts, which means that there are very few written cases that establish a precedent for lower courts or parties to follow. The result is that lower courts are free to rule according to their own discretion in most cases. While most judges are fairly consistent in their practices, this scenario still leaves both landlords and tenants without much guidance on the front end, unless they consult an attorney who is knowledgeable on the tendencies of each particular judge on each particular issue. The URLTA provides much-needed clarity to both parties on the major issues and others, and thus dispenses with the need for much of the guesswork that would otherwise exist.

It’s an even-handed statute. While clarity is good, a bad law that is clear is of no benefit. I believe the URLTA is even-handed in that it provides safeguards that protect the interests of both landlords and tenants. There is no question that the law contains rights and remedies for tenants, and that without the URLTA, some of these rights and remedies may not otherwise exist. For example, the URLTA creates a claim for retaliatory eviction that tenants may use either as a sword or as a shield against landlords who take action against them based upon the tenant’s exercising certain rights. However, the provision is quite even-handed in that it clearly defines the circumstances when a landlord may take action without fear of a retaliation claim or defense.

The URLTA also gives tenants claims against landlords for the following:

• unlawfully removing them from the rental unit via changing the locks or creating intolerable conditions;
• unlawfully entering the unit;
• willfully refusing to deliver possession of the unit at the beginning of the tenancy; 
• failing to fulfill maintenance obligations or provide essential services such as running water, heat, etc.;

It also puts strict demands on the procedures landlords must follow in order to retain a security deposit, prohibits them from accepting partial payments when evicting without the tenant’s explicit agreement, and requires that they follow certain notice procedures in order to evict or to enter the tenant’s rental unit. 

However, most of these claims already exist in the law. The doctrine of constructive eviction gives a tenant a claim against the landlord for any act/omission that interferes with the tenant’s ability to use/enjoy the unit and forces the tenant to vacate the unit. The general law of contracts makes it a breach of the contract for the landlord to fail to deliver possession of a unit, to fail to maintain it as the lease requires, or to fail to provide the services required by the lease. Even without the URLTA, in order for a landlord to retain a security deposit, he or she will always have to prove the condition of the unit at move-in, the condition at move-out, that the comparison between the two reveals damage caused by the tenant that exceeds ordinary wear and tear, and the cost of repairing the excessive damage. The doctrine of accord and satisfaction can be used to prevent landlords from evicting tenants after accepting rent payments. So, while there is no doubt that the URLTA has provisions that protect tenants, most of these protections already exist to some extent as a result of the years of cases decided by our appellate courts.

If the law already covers these claims, then why is the URLTA needed? Very simply, because the URLTA provides the specific guidelines each party must follow in relation to these claims and often puts a limit on the amount that may be recovered in such claims. For example, KRS 383.655 provides that if a landlord unlawfully removes a tenant from the unit or willfully refuses to provide essential services (heat, water, etc.), the tenant may recover possession of the unit and may sue for up to three months’ rent and a reasonable attorney’s fee. This provision makes clear the specific acts that are unlawful and the specific recovery that can be expected by either party if there’s a breach of the provision. That clarity can then guide each party’s behavior.

In addition, the URLTA gives significant protections to landlords. It provides for fairly quick and expedient eviction procedures. A tenant may be evicted for non-payment of rent upon seven days’ written notice, and for other material lease violations upon 14 days’ notice with one opportunity to correct the violation. More importantly, it clearly defines, and therefore limits, tenant defenses to evictions. Tenants may not avoid eviction for non-payment of rent merely by claiming a maintenance defect in their rental unit, as KRS 383.635 provides a detailed procedure that the tenant must follow in order to withhold the payment of rent, and then caps the amount that may be withheld to one-half of the rental payment. The procedure is so stringent that, in doing around 20,000 evictions, I’ve almost never seen any tenant be fully compliant, and I’ve never seen a tenant win an eviction case on this ground. It’s a fantastic safeguard for landlords that keeps them from having to litigate every single maintenance issue whenever a tenant fails to pay rent.

Another example of protections for landlords is that the URLTA makes clear that tenants are liable for damage they cause or permit to be caused to the rental unit. It gives the landlord the ability to enter the unit and repair the damage, and then bill the tenant for the damage. If the bill isn’t paid with the next rental payment, the landlord may terminate the lease and sue to recover the amounts owed, plus attorney’s fees. That's a very reasonable process and protection for landlords        

It goes on to provide specific protections against holdover tenants, tenants who willfully breach their leases, and tenants who unreasonably refuse access to their rental units. Even though it puts strict requirements for dealing with security deposits, the URLTA also limits a tenant’s claim on issues related to the deposit to particular items that the tenant identifies in writing to the landlord at the end of the tenancy. In other words, the process is clear and requires both parties to be fair to each other throughout. No one gets to hide the ball.

Finally, one of the best examples of the even-handed nature of the statute is the detailed lists of the maintenance obligations for both landlords and tenants, as well as the remedies each side may invoke when the other side fails to meet its obligations.

Landlords operating in multiple jurisdictions should support HB 380. While clarity and even-handedness are reasons that I think everyone should support the URLTA, there are other reasons for specific groups to support statewide-adoption of the URLTA. First, it makes the law uniform throughout the state. While this is not an issue for most, it is of significant benefit to those who own rental property in multiple jurisdictions. They can use the same leases and train their staff to the same standards. In fact, in some cases, a single property can cover multiple jurisdictions. I’ve represented clients with properties that are on a county line, with one portion of the property governed by the URLTA and the rest of the property outside the URLTA. Whenever an issue would arise, we had to review the plat map to determine in which jurisdiction the unit was located, then proceed accordingly. Talk about confusing! Granted, this is a rare occurrence, but landlords having properties in multiple jurisdictions is not. Having a uniform statewide law on landlords and tenants certainly makes life easier for those landlords.

Finally, all federally-assisted properties would benefit from the URLTA because it shortens the notice period for their evictions. HUD leases require that landlords carry out evictions in accordance with federal, state, and local law with regard to the details and processes of evictions. As such, HUD leases do not provide any stated notice periods. In most jurisdictions outside of the URLTA, the courts require 30 days’ notice prior to eviction unless the lease states otherwise. Since HUD leases do not state otherwise, such landlords must give 30 days’ written notice for all evictions. That puts them at least two months without receiving rent by the time they can file the eviction, much less actually remove the non-paying tenant.

Conclusion

While it’s certainly not perfect (I can point out some areas that could be improved greatly), I think the clarity and even-handedness provided by the URLTA make it worthy of support and statewide adoption. Reasonable minds can certainly disagree on this, and I’m open to arguments to the contrary. In fact, I’ll give you a disclaimer: there are not many attorneys, if any, who understand the URLTA with the same breadth and depth that I do. As a result, I will likely benefit as a professional if it is adopted statewide. So perhaps I'm biased. That being said, for the reasons above, I think landlords as a whole benefit from the URLTA. Regardless, I encourage you to take a look at HB issues and contact your state representative with regard to House Bill 380. As always, give me your comments below or shoot me an e-mail to discuss further.