Rent Withholding Remedy
Remedy 3: The "Rent Withholding" Remedy
By law, a tenant is allowed to withhold (stop paying) some or all of the rent if the landlord does not fix serious defects that violate the implied warranty of habitability.
In order for the tenant to withhold rent, the defects or repairs that are needed must be more serious than would justify use of the Repair and Deduct and Abandonment remedies.
The defects must be substantial and threaten the tenant's health or safety. For example:
Collapse and non-repair of the bathroom ceiling.
Continued presence of rats, mice, and cockroaches.
Lack of any heat in four of the apartment's rooms.
Exposed and faulty wiring.
An illegally installed and dangerous stove.
In other situations, the defects that would justify rent withholding may be different, but the defects would still have to be serious ones that threaten the tenant's health or safety.
In order to prove a violation of the implied warranty of habitability, the tenant will need evidence of the defects that require repair. In the event of a court action, it is helpful to have photographs or videos, witnesses, and copies of letters informing the landlord of the problem.
The basic requirements and steps for using the Rent Withholding remedy are:
The defects or the repairs that are needed must threaten the tenant's health or safety.
The defects must be serious enough to make the rental unit uninhabitable.
The tenant, or the tenant's family, guests, or pets must not have caused the defects that require repair.
The tenant must inform the landlord either orally or in writing of the repairs that are needed.
The tenant must give the landlord a reasonable period of time to make the repairs.
What is a reasonable period of time?
Depends on the type of repairs that are needed.
If the landlord doesn't make the repairs within a reasonable period of time, the tenant can withhold some or all of the rent. The tenant can continue to withhold the rent until the landlord makes the repairs.
How much rent can the tenant withhold?
While the law does not provide a clear test for determining how much rent is reasonable for the tenant to withhold, judges in rent withholding cases often use one of the following methods.
Percentage Reduction in Rent
The percentage of the rental unit that is uninhabitable is determined, and the rent is reduced by that amount. For example, if one of a rental unit's four rooms is uninhabitable, the tenant could withhold 25 percent of the rent. The tenant would have to pay the remaining 75 percent of the rent. Most courts use this method.
Reasonable Value of Rental Unit
The value of the rental unit in its defective state is determined, and the tenant withholds that amount. The tenant would have to pay the difference between the rental unit's fair market value (usually the rent stated in the rental agreement or lease) and the rental unit's value in its defective state.
If the tenant withholds rent, the tenant should put the withheld rent money into a special bank account (called an escrow account). The tenant should notify the landlord in writing that the withheld rent money has been deposited in the escrow account, and explain why.
Depositing the withheld rent money in an escrow account is not required by law, but is a very good thing to do for three reasons:
Rent withholding cases often wind up in court. The judge usually will require the tenant to pay the landlord some reduced rent based on the value of the rental unit with all of its defects. Judges rarely excuse payment of all rent.
Depositing the withheld rent money in an escrow account assures that the tenant will have the money to pay any "reasonable rent" that the court orders. The tenant will have to pay the rent ordered by the court five days (or less) from the date of the court's judgment.
Putting the withheld rent money in an escrow account proves to the court that the tenant did not withhold rent just to avoid paying rent. If there is a court hearing, the tenant should bring rental receipts or other evidence to show that he or she has been reliable in paying rent in the past.
Most legal aid organizations and lawyers will not represent a tenant who has not deposited the withheld rent money in an escrow account.
Sometimes, the tenant and the landlord will be able to agree on the amount of rent that is reasonable for the time when the rental unit needed repairs. If the tenant and the landlord can't agree on a reasonable amount, the dispute will have to be decided in court, or resolved in an arbitration or mediation proceeding (see section on Arbitration and Mediation).