In Two Weeks Notice, Lucy Kelson is a lawyer who tries to get out of a contract she drew up for employment. Desperate, she asks her dad, who is also a lawyer, for help to find a loophole that will let her quit her job.
Dad: Honey, this contract is excellent work. I’m very proud of you.
Lucy: Dad, I’m trying to get out of it!
Dad: This is ironclad. Houdini couldn’t get out of this thing.
So it’s true, what her boss stated just moments before in the movie. “...there are no loopholes because you drafted it and you’re the best.”
This situation was favorable to Lucy’s boss, but not to her. He reaped the benefits and she was no longer able to stand up for her community ideals. The irony is that she was the one who created the contract that bound her like a straitjacket.
It’s a warning for all contracts really. You want a contract that will hold both parties to an agreement and benefit you, which also means it needs to include a way out if situations change or the other party isn’t holding up their end of the deal as expected. A rental lease agreement would fit under this category.
When drawing up the rental contract it’s important to consider what loopholes the document will offer both the landlord and the resident. Some loopholes are required legally. For example, residents, under law, are allowed to terminate a lease if a building is unsafe to live in. Or if a resident is growing drugs in the apartment, this is an illegal activity that gives the landlord permission to evict the resident.
What will you allow? If you’re okay with residents painting their walls with prior permission, state it in the lease. What will you not allow? If you don’t allow pets to reside on your properties include this as well.
What are the terms of payment? This is usually the most spelled-out detail in a residential lease and one of the most abused. The amount, date payment is due, grace period, late fee… there’s a lot to include. You would think all the definitions you include about paying rent would make it seem straightforward, but one way residents get around this is to make partial payments. If you’re accepting partial payments from your resident it’s more difficult to evict them later. Be aware of loopholes that could be used against you and know your state laws.
Try to think of every situation that could possibly come up, then close loopholes and create loopholes accordingly, for both yourself and the residents. It’s also a good idea to have a lawyer look at the lease so they can let you know if you’re missing anything you’re required to have by the state. On top of that, from prior experience they will know clauses to include that you might not have thought of.
You drafted it and you’re the best. Let this be a statement that works for you and doesn’t come back to bite you later and unexpectedly.
