Blog Page 18 of 20 | Dunaway Law Group, PLC

Material Breach of Lease

10-day Notice for Material Breach of the Lease Agreement

Section 33-1368(A) of the Arizona Residential Landlord and Tenant Act gives guidance to Arizona landlords whose tenants have materially breached their rental agreement.

Section 33-1368(A) states in part;

“…if there is a material noncompliance by the tenant with the rental agreement…the landlord may deliver a written notice to the tenant specifying the acts and omissions constituting the breach and that the rental agreement will terminate upon a date not less than ten days after receipt of the notice if the breach is not remedied in ten days.”
Section 33-1308(A)

Section 33-1368(A) goes on to say;

“…if the breach is remediable by repair or the payment of damages or otherwise, and the tenant adequately remedies the breach before the date specified in the notice, the rental agreement will not terminate.”
Section 33-1368(A)

So, for example, if a lease agreement provides for two adults to live in your property but you find that 22 adults are living in the property then this is the notice you will want to send them.

The Initial 10 day Notice. A 10-day Notice addresses specific breaches of the lease agreement. For instance it might read, “I know you’ve got 22 people living in the house and we’re giving you 10 days to get rid of the extra 20 tenants.” If your tenants do get rid of their 20 roommates during the following ten days then you are not able to evict them because they rectified the situation within the allotted time.

Second 10 day Notice. However, if your tenants remove the 20 extra roommates and they return after the 10 day notice expires then we can sent them a second 10 day notice and there is no way they can rectify the situation at that point.

If you, are an Arizona landlord with tenants in material breach of their lease agreement then contact the Dunaway Law Group at 480-389-6529 or message us HERE.

* The information provided is informational only, does not constitute legal advice, and will not create an attorney-client or attorney-prospective client relationship. Additionally, the Dunaway Law Group, PLC limits its practice to the state of Arizona and New York.

Judgments and Credit Reports

power of judgments

Eviction judgments can be a powerful tool that dramatically increases the odds of a creditor collecting on the debt. A typical judgment will order the debtor to pay the amount awarded to the creditor, attorneys’ fees, court costs, and interest until paid in full. The Justice court jurisdictional limit is $10,000 (see A.R.S. 22-201), plus court costs (see Rule 139(d)) and attorneys’ fees (see Rule 139(d)).

After making a written demand for the awarded damages most people will not voluntarily pay. However, this is where the judgment itself can help an Arizona creditor recover their money.

A judgment can give creditors the power to garnish wages, levy bank accounts, or place liens on certain assets. Without the judgment all a creditor can do is beg for the money.

arizona evictions and credit reports

When a landlord obtains a judgment against someone, many people think it automatically go on their “record”, or credit report, but this isn’t always the case. The eviction judgment is a matter of public record, but the only way to guarantee that a judgment will show up on a credit report is to record the judgment with the relevant Arizona county. The eviction judgment will stay recorded until the debt is paid, it expires, or the debtor files bankruptcy.

In Arizona, most residential evictions occur in a Justice Court. In order to record the judgment with the county, a certified copy of the judgment must be sent to the Arizona Superior Court to receive a new case number. Once a Superior Court judgment has been established a certified copy can be recorded with the appropriate county. Each of these steps requires a filing fee–as of 2022–the total fees are just over $130.

A judgment will remain on the credit report until it is paid, or for as long as the judgment is valid. In Arizona, judgments are automatically valid for 10 years but can be renewed for another 10 years and another 10 years, etc. If the debt is paid in full, then the creditor must file a satisfaction of judgment with the county to demonstrate that the debt has been paid in full.

In summary, here are the main things to know when recording a judgment with the proper Arizona county.

The only way to ensure a judgment shows up on a credit report is to record it with the appropriate county recorder’s office.
If the judgment is paid in full, then the creditor MUST file a satisfaction of judgment with the court and then with the county recorder.
If not paid, the judgment will remain valid for 10 years, and an additional 10 years if it is renewed.

It is a common misconception that judgments automatically appear on a debtor’s credit report. However, this is not always the case. The judgment is a public record, and a diligent background checker will find it, but the only way to ensure the judgment appears on someone’s credit report is to record it with the county. Once this happens, it will appear on their credit report as a monetary judgment.

Ideally, a background check will reveal the eviction judgment even without it being recorded with the county. If you are a landlord, you should always perform background checks on prospective tenants.

However, for more everyday occurrences that don’t require a full-blown background check (like applying for a credit card or loan), having a blighted credit report can make life difficult.

satisfaction of judgment

Once a judgment debtor has satisfied a judgment, it is the creditor’s responsibility to file a satisfaction of judgment with with the relevant court. This will notify all interested parties that the debt has been paid in full.

If you need help from an Arizona real estate attorney, then contact the Dunaway Law Group at 480-389-6529 or message us HERE.

Adding Rent and Damages to a Judgment

What options are available to Arizona landlords if they find new damage to their rental property after the tenants have been evicted? Rule 13(c)(2)(A) of the Eviction Action Rules of Procedures states that: “…if the plaintiff is entitled to rent incurred after the judgment has been entered, then the plaintiff may seek that amount in a separate civil action.”

Rule 13(c)(2)(E) of the Eviction Action Rules of Procedures indicates that damages can only be awarded if they were “…properly pled in the complaint and when such damages resulted from the breach giving rise to the eviction.”

filing civil lawsuit against former tenant

Rent or damages sought post-eviction judgment must be sought in a separate civil suit, rather than an eviction action. While an eviction judgment can be obtained in just a couple of weeks, a civil judgment takes much longer to get – usually several months.

However, if the damage to your property is extensive, and you believe you have a good chance of recovering the money from your tenant, then it can be worth the time and money it takes to pursue.

An Arizona landlord may sue a former tenant for damage to the property while they were living there. Cost of repairs that are above the normal wear and tear of tenants is recoverable. The security deposit is held in reserve to help off-set the cost of rehabilitating the property for new renters. However, after subtracting the deposit from the cost to rehab the property a landlord may decide to sue the former tenants for the full extent of damages sustained.

This highlights the importance of performing a thorough walk-through each time a tenant moves in or out of the property. Take very detailed notes, videos, and pictures of the property and note any damage. Give the tenants a copy of these records. Keep very detailed records of the cost to make the repairs. We must be able to prove to the court exactly how much it cost to repair the significant damage caused by a former tenant.

However, even if the tenant has vacated the property there is still an available remedy to try and seek a judgment against your former tenant. In this situation you may sue the former tenant under a breach of contract. The theory behind this is, a lawsuit existed (the lease agreement) and the contract was broken.

Unlike an eviction lawsuit, a civil lawsuit is very slow moving and the attorneys’ fees are much more expensive. Depending on many factors; whether the tenants counter-sue, hire legal counsel, are difficult to serve, and an extensive amount of discovery is required the typical case can range between 5 to 12 months! Much longer than the average 14 – 21 days required for a residential eviction.

does it make sense to file a new lawsuit?

In 99% of the instances, it does not make economic sense sue your former tenant through a breach of contract with a civil lawsuit. It’s just not worth the time, expense, and hassle of trying to get a judgment against them. Lastly, don’t forget, just because you actually obtain a judgment against your former tenant doesn’t mean that you’ll be able to collect on it. Often the judgment isn’t worth the paper it’s printed on.

If you need help from an Arizona real estate attorney, then contact the Dunaway Law Group at 480-389-6529 or message us HERE.

When is a Bankruptcy Complete?

bankruptcy discharge

One of the major steps to wrapping up a bankruptcy is the Discharge. A discharge means that all of your “dischargeable” debts have been completely erased. Discharges are typically entered 70 to 90 days from the date of your 341 hearing. Many people believe that their bankruptcy is over once a discharge has been entered; however, this is not the case. There is one very important step after the discharge, the ‘closing’.

closing the bankruptcy

After the discharge, the bankruptcy trustee must “close” the bankruptcy in order for it to be completely finished. A trustee can close a case anywhere from a couple of months to a year after the discharge has been entered. Once a bankruptcy has been closed an entry will appear on the docket that reads:

“The estate having been fully administered, further administration of the reopened case having been completed, or the case reopened for the filing of further proceedings which either have been filed and no further court action is required or were not filed within 90 days of the reopening; IT IS ORDERED that the case is closed and if a trustee has been appointed, the trustee is discharged from and relieved of his trust. Jurisdiction is retained over any pending adversary(s).”

Click HERE to see an actual Notice of Closing.

In most cases the timing of the bankruptcy closure is not an issue; however, it can become important in some certain instances. For example, if you are want to sell your home or any other real property this cannot happen until the bankruptcy has been officially closed. The reason why you can’t sell the property is because the automatic stay is still in effect.

If you are an Arizona resident and need to file bankruptcy, then contact us at the Dunaway Law Group by calling us at 480-702-1608 or message us HERE.

Intentional Destruction of Rental Property

What Options Does a Landlord Have When a Tenant Intentionally Damages a Rental House?

A.R.S. Section 33-322 states;
“Removal or intentional and material alteration or damage of any part of a building, the furnishings thereof, or any permanent fixture, by or at the instance of the tenant, without written permission of the landlord or his agent, is a class 2 misdemeanor.”

Essentially, if your Arizona tenant intentionally damages your property they may be arrested and charged with a crime. Often when I am speaking with Arizona landlords they express the fear of a tenant trashing their property. The good news is that rarely do tenants intentionally damage a property out of spite. Though tenants often damage properties because of how careless and dirty they are while living in the home.

If your Arizona tenant has intentionally damaged your rental property then contact the Dunaway Law Group at 480-702-1608 or message us HERE.

The Dunaway Law Group provides this information as a service to clients and other friends for educational purposes only. It should not be construed or relied on as legal advice or to create a lawyer-client relationship. Readers should not act upon this information without seeking advice from professional advisers. The Firm limits its practice to the State of Arizona.