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When Tenants Divorce

When tenants divorce, what should you do? Amanda and Marshal seemed like the perfect couple. They’d known each other since kindergarten, were an item in high school, and had been living together during university. Now in their mid-twenties, they both earned a decent wage and wanted to leave their student digs behind and move into a nice cat-friendly condo. They signed a year fixed-term lease. Since they’d talked about starting a family, I assumed they’d be tenants for years and would only move out once they bought a house.

Six months later, a tearful and emotional Amanda called to say they were splitting up. She’d already moved out and asked to have her half of the security deposit refunded immediately. Once I got over my initial shock, I asked her to give me the evening to review the lease agreement terms and set a date/time to get back to her.

Tenants divorce. Couples break up. That’s life. Although you may be tempted to side with one or the other, it’s best to remain as objective and neutral as possible and stick to the logistics of the lease agreement. Don’t allow yourself to be swept into the drama. Expressing empathy is fine but losing your objectivity can get you into a legal mess. Here are a few things to consider.

Who’s staying and who’s leaving?

If both partners signed the lease as tenants, they are both responsible for paying the lease until the end of the term. Here are a few common scenarios.

  • One agrees to stay and wants the lease under their name. You can draw up a new rental agreement or draft an addendum that both sign/date.
  • One tenant wants to stay but can’t afford the lease on their own. They can either bring in a roommate or have a co-signer. Just remember to let the remaining tenant know the new tenant must pass your screening process and be approved by you.
  • They both want to leave. They are both responsible for paying the lease until the end of the term until suitable tenants are found to take over the lease.
  • One party is listed as a tenant, and the other party is listed as an “other occupant.” Only the tenant is responsible for paying the lease and can stay if they choose. If the tenant chooses to leave, they are responsible for paying the lease for the duration of the lease term until a suitable tenant is found to take over the lease agreement.

Access to your property

In the absence of a restraining order, the Victims of Domestic Violence Act, or a new rental agreement, if both parties on the lease are feuding over who will stay and who will leave, neither you nor the tenants can change the locks without a court order.

Security deposit

Security deposits are pretty cut and dry. Upon the termination of the lease, whoever paid the security deposit should be sent the security deposit minus any deductions for damages or cleaning (as per the Alberta RTA). If both parties paid ½ of the security deposit, they must both be sent their ½ of the security deposit.

The Final Outcome

Marshal stayed for two more months, then Covid hit, and he lost his job. The condo owner was very sympathetic and reduced his rent because she’d also experienced a recent breakup and lost her job during Covid. After two months, Marshall decided to move out, and the condo owner let him go without penalty and moved back into her condo.

In the end, it was a game of unpredictable musical chairs that oddly worked out well for everyone.

Have you experienced a sharable story of a tenants divorce during their lease? I’d love to hear about it – email me [email protected]

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