Is a management company responsible for water damage to a rental house?

I’ve been paying a 10% commission to a real estate company for finding a tenant, managing problems, collecting rents, etc. A tenant allowed extensive water damage by ignoring a roof leak (he has no money, is in jail). Is the manager responsible for the repairs (we had no homeowners insurance) that I’ve already paid out of pocket. There was no formal, signed management agreement.

Asked on June 5, 2012 under Real Estate Law, Florida

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 8 years ago | Contributor

If the management company were at fault in causing the damage--such as by not providing maintenance which they were supposed to do; or not responding to a leak when the tenant reported it--then you could hold them liable. However, in the absence of a contract in which the management company agreed to be liable for all damage to your home, they would only be liable if you can show they were at fault in causing the damage--that is, the damage occured due to their negligence (or unreasonable carelessness) or failure to perform some of their responsibilities. Without fault, they would not be liable; they are not your insurer.  You could potentially sue the tenant for  his negligence in ignoring the leak, but if he has no money and no job, that will not help you. In the future, make sure you  have the appropriate insurance; and if the rental is not paying enough to cover the cost of insurance, it's likely not worth doing, given the risk you are exposing yourself to.


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