Simple Lease Mistake Cost Landlord Over $33,000

by | Jun 28, 2010 | Rental Forms, Rental Property Management Tips

A Chicago landlord was ordered to pay a judgement well over $33,000 after making a mistake in the leasing process. 
The landlord had entered into a rental lease agreement for a posh penthouse apartment, netting $7,500 per month in rent.  The tenants paid a security deposit of $11,200.  The tenants remained in the apartment for nearly eighteen months before they were faced with an unexpected job loss.  They appealed to the landlord to allow them to sublet for the remaining six months of the lease term so they could pursue an employment opportunity out of state.
When the landlord refused, the tenant consulted a lawyer for a way out.
Mark Silverman, a Chicago tenants-rights attorney took up the cause. “As we investigated the case, we found that the landlord had failed to include a statutory disclosure in their rental lease agreement concerning interest on security deposits,” Silverman explains.  “Under local statutes, that omission allowed us to terminate the lease on short notice.”
The tenants moved, leaving behind the $11,200 security deposit.  “They were satisfied to just be done with the whole mess,” Silverman adds.
But four months later, the tenants were served with a summons to appear in court.  The landlord had been advised to ignore the lease termination and sue for the remaining six months’ rent under the lease.
Faced with this new development, the tenants re-engaged Silverman’s firm, and counter-sued for return of the deposit, treble damages for the wrongful withholding of the security deposit, attorneys fees and costs. 
The tenants were successful in court, and were awarded more than $33,000 as allowed by the security deposit statute.  In addition, tenants were awarded their attorneys fees and costs to defend the landlord’s suit. The judge held that the failure to include the requisite disclosures at lease signing allowed the tenant to effectively terminate the lease, as Silverman initially argued.
This case underscores the importance of using checklists when completing  rental forms.
Mark Silverman is a Chicago security deposit lawyer with Mark Silverman Law Office, Ltd. 

This post is provided by Tenant Verification Services, Inc., helping landlords reduce the risks of renting with fraud prevention tools that include Tenant Screening, Tenant Background Checks, (U.S. and Canada), as well as Criminal Background Checks, and Eviction Reports (U.S. only).

Click Here to Receive Landlord Credit Reports.

Disclaimer: The information provided in this post in not intended to be construed as legal advice, nor should it be considered a substitute for obtaining individual legal counsel or consulting your local, state, federal or provincial tenancy laws.

Property management software for Canadian Condos.

Property Boss

Property management software for single family, multifamily, and student housing.


Screening services for property managers and landlords. Select a market below.