New Property Management/Leasing Forms
The Arizona Residential Landlord and Tenant Act (ARLTA) regulates the rights of tenants and obligations of landlords in the rental of dwelling units. Many protections are provided to tenants in the ARLTA. Especially critical are those statutes that ensure property managers are in compliance when it comes to delivering the proper notices to tenants. Continuing to provide essential tools in risk management, the Arizona Association of REALTORS® (AAR) introduces five new property management forms that better enable property managers to comply with their statutory obligations.
The Notice of Abandonment informs the tenant that the landlord considers the premises to be abandoned. This form outlines the differences between abandonment “with personal property” and abandonment “without personal property”. In addition, the form provides a specific timeline and step-by-step instructions a landlord may follow to regain possession of the premises, including changing door locks, taking inventory and disposing of personal property. A.R.S. § 33-1370 requires the landlord to send this notice via certified mail, as well as post the notice on the door or other conspicuous place on the property for a period of five days.
The Notice of Nonrenewal of Lease Agreement provides the tenant proper notice that the lease will not renew and the tenant must vacate the premises. If the AAR Residential Lease Agreement is used, it is essential for the landlord to provide notice of their desire not to renew on, or prior to, the last rental due date of the original lease term. The form may also be used to provide proper 30-day notice to terminate a month-to-month tenancy. In addition, this form includes a helpful provision explaining that the tenant may not use the security deposit as last month’s rent, but must pay rent through the term of the lease agreement.
The Notice of 2-Day Access provides notice to the tenant of the landlord’s intent to enter the rental unit for the purpose of inspecting the premises, making necessary or agreed repairs, improvements or services, or showing the property to prospective purchasers, mortgagees, tenants, workmen or contractors. In case of an emergency, the landlord may enter the property without the prior consent of the tenant.
The Notice to Tenant of Management Termination is useful in providing the tenant with proper notice that the property management company will no longer manage the property the tenant is leasing. The form allows the management company to provide instructions on where to direct future rents, notices, payments of any kind and repair requests. The transfer, or return, of the security deposit may also be noted in this form. This includes details on how the security deposit will be handled if the leased premises are subject to a foreclosure.
The Statement of Disposition of Deposits and Accounting allows the landlord the opportunity to provide to the tenant a detailed accounting of the charges or deductions attributable to the tenant’s security deposit, whether refundable or non-refundable, and whether a judgment has been obtained. Line one stipulates the date of “termination of tenancy” and “delivery of possession”, which are critical. Within 14 days of that date, excluding Saturdays, Sundays or other legal holidays, the landlord shall provide the tenant an itemized list of all deductions together with the amount due and payable to the tenant. In the event the tenant owes a balance to the landlord, the form contains a demand for payment and provides notice that this is an attempt to collect a debt.
The AAR Property Management Ancillary Forms committee did an excellent job in the creation of these forms. Each form is user-friendly and easy to read and implement. We hope you find the forms helpful in applying the applicable landlord/tenant statutes set forth in the ARLTA.
NOTE: Along with the author of this article, Lisa Suarez, who served as the chair of this forms workgroup, AAR would like to thank the other workgroup members: Sue Flucke, Jeff Hockett, Jacquie Kellogg, Mike Mumford, Alberta Shantz and Brad Snyder, along with AAR staff Scott Drucker, Christina Smalls and Jan Steward.
FAQs on New Property Management/Leasing Forms
Q1. Does posting the Notice of Abandonment on the door to the dwelling unit constitute sufficient delivery?
A1. No. In addition to posting the Notice of Abandonment on the door to the dwelling, A.R.S. § 33-1370(A) requires that the Notice be sent by certified mail, return receipt requested, addressed to the tenant’s last known address and to any of the tenant’s known alternate addresses.
Q2. If a property manager is unable to ascertain whether the tenant’s personal property is present in the dwelling unit, how should the property manger complete the Notice of Abandonment?
A2. If the property manager is unable to observe whether the tenant has removed all personal property from the dwelling unit, the property manager should err on the side of caution and assume that personal property remains. In that case, the property manager should check the box found on line five of the Notice of Abandonment and deliver the Notice as required by A.R.S. § 33-1370, provided that: (i) the tenant has been absent from the dwelling unit for at least seven days without notice; (ii) rent is past due for at least 10 days; and (iii) there is no reasonable evidence that the tenant is still residing at the dwelling unit.
Q3. If the tenant is on a month-to-month lease that requires rent to be paid on the first day of the month, can the landlord inform the tenant mid-month that the lease will terminate at the end of that month?
A3. No. A.R.S. § 33-1375(B) states, “The landlord or the tenant may terminate a month-to-month tenancy by a written notice given to the other at least thirty days prior to the periodic rental date specified in the notice.” So, if rent was paid on August 1, and the landlord issues the Notice of Nonrenewal of Lease Agreement on August 15, the lease cannot be terminated by the landlord prior to September 30, which is 30-days after the tenant’s next rental due date of September 1.
Q4. What steps should a property manager take to ensure that a lease terminates at the end of the term as opposed to continuing on a month-to-month basis?
A4. Lines 20-21 of the AAR Residential Lease Agreement state, “this lease agreement shall automatically continue on a month-to-month basis, but with all other terms and conditions set forth herein remaining the same, unless either party provides written notice to the other of their intention to terminate the lease agreement.” If the property manager is under instructions to terminate the lease at the end of the term, the property manager should either hand deliver or send via certified mail to the tenant a completed Notice of Nonrenewal of Lease Agreement in which the box on line three is marked. This notice must be delivered to the tenant on or prior to the last rental due date of the original term.
Q5. Under what circumstances should the landlord utilize the Notice of 2-Day Access?
A5. Unless the tenant requests repairs in writing, the lease owner must give the tenant at least two-days notice to enter the dwelling unit during reasonable hours to make repairs, conduct inspections, have services completed or exhibit the dwelling unit to prospective purchasers and tenants. The dwelling unit may be immediately entered in the event of an emergency or by court order. See A.R.S. § 33-1343.
Q6. Does posting the Notice of 2-Day Access on the door of the dwelling unit constitute sufficient delivery?
A6. No. Pursuant to A.R.S. § 33-1313(B), in the case of the tenant, notice is effective when delivered in hand to the tenant or mailed by registered or certified mail to the tenant at the place held out by the tenant as the place for receipt of the communication or, in the absence of such designation, to the tenant’s last known place of residence.
Q7. If the tenant delivers a written repair request to the landlord, must the Notice of 2-Day Access form be utilized before a repairman can enter the dwelling unit?
A7. No. A.R.S. § 33-1343(B) states in part, “If the tenant notifies the landlord of a service request or a request for maintenance as prescribed in section 33-1341, paragraph 8, the notice from the tenant constitutes permission from the tenant for the landlord to enter the dwelling unit pursuant to sub-section D of this section for the sole purpose of acting on the service or maintenance request and the tenant waives receipt of any separate or additional access notice that may be required.”
Q8. What should a property manager do with the tenant’s security deposit in the event that the dwelling unit is foreclosed by trustee’s sale?
A8. Following foreclosure by trustee’s sale, the property manager should transfer the tenant’s security deposit to the successor owner or to a property manager designated by the successor owner. If the dwelling unit has been foreclosed and the successor owner is not known within 14 business days from the date of the foreclosure, the property manager can refund the security deposit directly to the tenant. Under such circumstances, it is appropriate for the property manager to check the box on line 16 of the Notice to Tenant of Management Termination.
Q9. What should a property manager do if, after having issued a Notice to Tenant of Management Termination, the tenant nonetheless attempts to deliver a rent payment to the property manager?
A9. Provided that the attempted delivery of rent occurs after the date set forth on line three of the Notice to Tenant of Management Termination, the property manager should refuse to accept the payment. Additionally, the tenant should be advised to deliver the rent payment to either the owner set forth on line eight of the Notice or the new property management company set forth on line 11 of the Notice.
Q10. By what date must a completed Statement of Disposition of Deposits and Accounting be delivered to the tenant?
A10. Within 14 days, excluding Saturdays, Sundays or other legal holidays, after termination of the tenancy, delivery of possession and demand by the tenant, the tenant is entitled to receive an itemized list of any/all security deposit deductions together with the amount due and payable to the tenant. See A.R.S. § 33-1321(D).
Q11. How should a property manager complete the Statement of Disposition of Deposits and Accounting in the event that the precise amount of a specific fee is not yet known at the time the Statement of Disposition of Deposits is prepared?
A11. Under such circumstances, the Statement of Disposition of Deposits and Accounting should reflect a reasonable estimation of the fee. As set forth on lines 41-43 of the Statement, if any amount is an estimate and the actual cost is less than the estimate, the tenant should be provided with an updated disposition and refund. Alternatively, if the actual cost is greater than the estimate, the tenant should be provided with an updated disposition and demand for payment.
About the Author:
Scott M. Drucker, Esq., a licensed Arizona attorney, is General Counsel for the Arizona Association of REALTORS® serving as the primary legal advisor to the association. This article is of a general nature and reflects only the opinion of the author at the time it was drafted. It is not intended as definitive legal advice, and you should not act upon it without seeking independent legal counsel.