We have recently seen multiple natural disasters affecting people across the United States. Hurricane Helene’s damage to Western North Carolina is devastating, and people are still reeling from its impact. Already, our office is receiving calls from affected individuals about how to handle their landlord/tenant relationship in the wake of this natural disaster. I have put together this guide specifically for residential rental property (but does not include vacation rentals or transient occupants). I hope this post helps all who read it navigate this challenging situation. Please do not hesitate to call our office for further assistance; we are praying for you and hope for a speedy recovery.
– Matthew P. Ceradini, Esq.
- North Carolina
North Carolina has adopted the Residential Rental Agreement Act, which can be found under Article 5, Chapter 42 of the North Carolina General Statutes (N.C.G.S. §§ 42-38 – 42-47) (hereinafter, the “RRAA”).
- Application of the RRAA
The RRAA applies to residential landlord-tenant transactions only and does not apply to transient occupancies, migrant housing, vacation rentals, or any dwelling furnished without charge or rent.
- Mutuality of Obligations
The RRAA specifically states there is a mutuality of obligations (“The tenant’s obligation to pay rent under the rental agreement or assignment and to comply with N.C.G.S. 42-43 and the landlord’s obligation to comply with N.C.G.S. 42-42(a) shall be mutually dependent.” N.C.G.S. § 42-41).
- Landlord Obligations under the RRAA (N.C.G.S. § 42-42(a))
- to comply with current applicable building and housing codes;
- to make all repairs and do whatever is necessary to put and keep the premises in a fit and habitable condition;
- to keep the common areas of the premises in a safe condition;
- to maintain and repair all electrical, plumbing, sanitary, heating, ventilating, air conditioning, and other facilities and appliances supplied or required to be supplied, provided that the tenant gives written notice of such repairs (except in emergency situations);
- to provide properly installed, operable smoke alarms and replace all batteries in battery-operated alarms at the beginning of each tenancy (and to repair or replace a smoke detector within 15 days of a tenant’s written request);
- to install, replace, and repair carbon monoxide alarms;
- to repair within a reasonable time imminently dangerous conditions actually known to the lessor; and
- to comply with all applicable elevator safety requirements.
The key term here is “fit and habitable condition,” which is determined by compliance with the list above. When the premises have one or more defects, it’s considered “fit and unhabitable” and entitles the Tenant to certain remedies under the RRAA.
- Tenant Obligations (N.C.G.S. § 42-43)
Affirmative obligations –
- keeping the premises as clean and safe as conditions permit;
- keeping plumbing fixtures clean;
- disposing of all ashes, rubbish, garbage, and other waste in a clean and safe manner;
- complying with statutory provisions relating to smoke and carbon monoxide alarms;
- complying with any obligations imposed upon the tenant by applicable building; and housing codes.
Prohibited Conduct –
- The applicable statute also prohibits a tenant from causing unsafe or unsanitary conditions; and
- from deliberately or negligently damaging property.
Notice Requirement-
The Tenant is required to give notice of a defect or an uninhabitable condition to the Landlord in writing unless it’s an emergency situation (like a natural disaster). Where the Landlord has actual knowledge of an imminently dangerous condition, he/she has a duty to repair regardless of whether the Tenant provided notice. Oral notice has been found to be sufficient where the Landlord acknowledges receipt of the notice from the Tenant.
- Remedies
If the Tenant is not paying rent, then there is a breach of the lease agreement, and the Landlord can seek possession of the premises and recovery of unpaid rent.
Where an uninhabitable condition arises by no fault of the Landlord, he or she is still obligated to keep the premises in a fit and habitable condition under the RRAA. Thus, the Landlord is obligated to repair the premises and should do so in a reasonable period. However, in disaster situations, there won’t be liability for negligence or negligence per se for the premises’ condition because it occurred by an intervening cause and not as a result of the Landlord’s own actions (or inaction). Nevertheless, if the uninhabitable condition persists, it could be considered a breach of the RRAA.
Where the Landlord has materially breached the RRAA, the Tenant is entitled to rent abatement damages measured by the difference between the fair rental value of the rental unit as warranted and the fair rental value of it in its unfit condition. Alternatively, the Tenant may terminate the lease and vacate the premises. Regardless of whether the Tenant seeks a rent abatement or termination, the Tenant may also seek recovery of special and consequential damages suffered.
The breaching Landlord is liable for both retroactive and prospective rent abatements during the period of the breach. However, if a Tenant withholds rent without seeking permission from the courts for rent abatement, he or she may still seek damages, but rent abatement is only for rent paid by the Tenant for substandard housing. However, withholding rent will be a breach of the lease agreement, entitling the Landlord to terminate the lease and seek possession of the premises and recovery of unpaid rent (even if only the fair rental value of the premises in the unfit condition).
- Bottomline – Negotiate terms because if you don’t pay, you don’t stay.
The Tenant is required to give notice of conditions that would render the premises in an uninhabitable condition. However, where there is an emergency (such as a natural disaster) and/or the Landlord has actual notice, the Tenant notice requirement is waived.
At the time the Landlord learns of the uninhabitable condition(s), he/she must make a reasonable effort to fix the condition in a timely manner. The time period where the premises are not in a fit and habitable condition entitles the Tenant to rent abatement (the difference between fair market value rent and rent for the premises in the unhabitable condition). Alternatively, the Tenant may terminate the lease and move out (i.e., turnover of possession back to the Landlord).
Sometimes, termination is not beneficial to the Tenant, particularly if there is a scarcity of rental units due to the disaster affecting the local area. In such cases, the Tenant must continue to pay rent but should seek rent abatement from the Landlord before unilaterally withholding rent. It behooves the Landlord to negotiate a temporary rent abatement until he or she can determine the extent of the damage, the cost of repairs, and the timeline for completing the repairs. If the parties cannot come to an agreement, then the Tenant can exercise his or her right to terminate but shouldn’t expect to stay in the premises for free, despite its condition.
The key here is all parties must show compassion to one another in a disaster situation and work together towards an amicable solution. Money is secondary to the health and welfare of individuals while they are being affected by the disaster. However, the adage “don’t pay, don’t stay” still applies, and during the recovery period all parties should respect and honor their respective commitments and obligations to the best of their abilities.