I want to fire my property manager for not doing his job but he says he has an iron clad agreement and there is nothing I can do
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I want to fire my property manager for not doing his job but he says he has an iron clad agreement and there is nothing I can do
We are homeowners who hired a property management company to get our home rented. They have had our home since July of this year, and the company has failed to get our home rented. They keep finding prospective tenants and make us as homeowners jump through a list of hoops to get the place rented out. We have spent almost 1000 dollars and lost 5 months of rental income, including having to pay for the mortgage . It has become a financial drain. They are not doing their job well and I would like to fire the property manager. He says that he has an iron clad contract and he can do whatever he likes to my property, and even if it remains unrented, there is nothing I can do because we have signed a one year lease with him. What is my recourse?
I have copied and pasted snippets of the lease agreement
Duration of Agreement. This Agreement shall be binding when it has been signed and dated below by Owner and Agent. It shall become effective on 7-11-16 Effective Date and shall be for an initial term of ONE YEAR. NOT LESS THAN 60 DAYS PRIOR TO THE CONCLUSION OF THE INITIAL TERM, EITHER PARTY MAY NOTIFY THE OTHER PARTY IN WRITING OF ITS DESIRE TO TERMINATE THIS AGREEMENT, IN WHICH CASE IT SHALL TERMINATE AT THE CONCLUSION OF THE INITIAL TERM. IF NOT SO TERMINATED, THIS AGREEMENT SHALL AUTOMATICALLY RENEW FOR SUCCESSIVE TERMS OF YEAR TO YEAR EACH UNLESS EITHER PARTY GIVES THE OTHER PARTY WRITTEN NOTICE OF ITS DESIRE TO TERMINATE THIS AGREEMENT AT LEAST 60 DAYS PRIOR TO THE CONCLUSION OF ANY SUCH RENEWAL TERM, IN WHICH CASE THIS AGREEMENT SHALL TERMINATE AT THE CONCLUSION OF SUCH TERM.
3. Agents Fee. For services performed hereunder, Owner shall compensate Agent in the following manner A fee Fee equal to the greater of i NINE percent 9 of total gross rental income received on all rental agreements, or ii 50per month for each month of the Initial Term or any renewal term of this Agreement. Other describe methods of compensationLEASING FEE IS 50 OF THE MONTHLY RATE ON ONE MONTH’S RENT FOR THE TENANTS THAT .
Note No fees may be deducted from any tenant security deposit until the termination of the tenancy. Thereafter, any fees due Agent from Owner may be deducted from any portion of the security deposit due to Owner.
4. Early Termination Fee If, prior to the end of the Initial Term or any renewal term of this Agreement, i Owner terminates this Agreement without legally sufficient cause or ii Agent terminates this Agreement for legally sufficient cause, Owner shall pay Agent an amount equal to the Fee Agent would have been entitled to receive during the balance of the then-existing term of this Agreement, taking into account any rental agreements in effect at the time of such termination.
5. Other Fees Agent may charge tenants reasonable administrative fees permitted by law and retain any such fees, including but not limited to, fees to cover the costs of processing tenant rental applications. If, in Agents discretion, tenant leases provide for late payment fees and/or returned check fees, such fees, when collected by Agent, shall belong to AGENT EXCEPT 50 OF THE LATE FEE Owner or Agent. Fees for purposes covered under the Tenant Security Deposit Act will be collected, held and disbursed in accordance with the Act and paragraphs 10, 13 and 17 of this Agreement.
Asked on November 22, 2016 under Real Estate Law, North Carolina
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 7 years ago | Contributor
He is not entirely correct: all contracts have added to them by law what is called the "implied covenant of good faith & fair dealing" which obligates the parties to act in good faith towards each other. A failure to use reasonable efforts to accomplish the goals of a contract would be a violation of this implied covenant and allow the contract to be terminate for breach. However, the covenant only requires "reasonable" efforts--it does not require examplary efforts or success. So if they are trying to lease the premises and are presenting possible tenants who are not unreasonable (e.g. they have decent credit, could afford the place, however), they are doing everything they are obligated to. Only if they are basically not trying or are trying in a completely incompetent way (not listing the property for rent where other properties in that area are listed; presenting frankly unqualified tenants; etc.) would they be in breach and would you have a reasonable likelihood of terminating the contract.
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