Landlord Liability for Criminal Acts and Activities
The High Cost of Crime

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      The settlements paid by insurance companies on behalf of landlords for crimes like rape and assault in the U.S. averages more than $500,000. The average jury award for cases that actually go to trial is $1.2 million.

      Most state law and courts make landlords responsible for providing at least some degree of protection for their tenants from the criminal acts of employees, other tenants and outsiders.
      Landlords may also be expected to protect the neighborhood from their tenant's illegal activities, particularly drug dealing. These duties to the public may stem from building codes, local ordinances and statutes, but are most often the result of court decisions.

Landlords may be libel for crime on the property from outsiders.

      In a Port Huron Michigan case, State Farm Insurance settled a tenant's claim that the landlord failed to warn her about a neighbor with a reputation for drinking and violent behavior. The landlord contended that he had no prior knowledge about the neighbor; the lawsuit claimed: "he should have known." The insurance company thought it prudent to settle.

      There is no possible way to prevent every conceivable claim for damage against a property owner, however reasonable preventive measures are the best hope to limit liability from criminal acts and activities.
      The following precautions may help limit the likelihood that criminal activity will occur on a rental property, and reduce the risk that a property owner will be found responsible if a criminal assault or robbery does occur:

• Educate tenants, in writing, about the risks of crime in the building and the neighborhood.

• Meet or exceed all state and local laws that apply to the rental property security, such as requirements for deadbolt locks on doors, good lighting and window locks. Describe the security measures that you have provided to the tenant and explain their limitations.

• Design and maintain a security system that provides reasonable protection for the tenants in common areas such as play grounds, pools, parking garages and elevators. Contact local police departments in writing for suggestions and advice on security measures.

• Offer additional security options that may require higher rents. Many tenants will pay more for a safer place to live.

• Maintain regular inspection records noting any security problems, such as broken locks or burned out exterior flood lights, and when they were repaired. Ask tenants in writing for their suggestions as part of an ongoing repair and maintenance system.

• Handle tenant complaints about dangerous situations, suspicious activity or a broken security items immediately. A landlord has a higher level of legal liability should a tenant be injured by a criminal act while a security system is out of service or a lock on a window or door is broken.

Avoid tenants who deal drugs or otherwise break the law

       The most effective method for avoiding troublemaking tenants can be done with good screening procedures. In this information age we can find out almost anything about anybody's past if we are willing to take the time and spend the money. However, in most cases getting a credit report and checking with previous landlords and employers will indicate pretty clearly if further checking is warranted.

      There are several other practical steps landlords can take to limit their liability and financial exposure from any lawsuits that are filed:

• Keep the results of screening and background checks that show the tenant's previous rental and job history.

• Include an explicit provision in the lease or rental agreement prohibiting drug dealing and other illegal activity and promptly evict tenants who violate the clause. Do not tolerate tenants' disruptive behavior.

• Be aware of suspicious activity, such as heavy traffic in and out of the rental premises and question the tenant in writing about it.

• Respond to tenant and neighbor complaints about drug dealing on the rental property. Get advice from police immediately upon learning of a problem.

Landlord's liability from tenants who deal drugs on the property

      Landlords are open to all kinds of practical and legal problems from tenants who deal drugs on the property. When communities become frustrated with the inability of government to control drugs, they naturally look for any scape goat available, particularly if they can find someone to blame with deep pockets.
      The war on drugs in America has cost billions of dollars and unprecedented erosion of many constitutional rights. Any police power is apparently acceptable to most citizens if officials claim it it necessary to fight drug abuse among children.

• Authorities have the power to pursue criminal penalties against any landlord who knowingly allows drug dealing on rental property
   
• State and federal law provided for levy stiff fines and padlock penalties against landlords for allowing illegal activity to continue subsequent to a raid or notification.

• The presence of drugs could result in government confiscation of the rental property.

• Anyone who is injured or annoyed by drug dealers, including other tenants or even people in the neighborhood, may sue the landlord on the grounds that the property is a public nuisance that seriously threatens public safety or morals. Some cases have been successfully brought contending a loss of neighboring property values do to a landlords failure to evict known drug dealers.

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