Survey of Colorado Landlord and Tenant Law
| Publication year | 1991 |
| Pages | 2023 |
| Citation | Vol. 10 No. 1991 Pg. 2023 |
1991, October, Pg. 2023. Survey of Colorado Landlord and Tenant Law
Landlord and tenant law has its roots in the Middle Ages, but during the past decade, Colorado courts have begun to deviate from those feudal foundations and to craft a more modern law of landlord and tenant. This new law injects contract principles where only property law ruled before and has placed more responsibilities on the landlord, who once reigned supreme. The legislature has continued the trend towards increasing landlord responsibilities with the recent passage of the Gas Equipment Hazards Act.
Many clients are involved in leasing real estate for business or personal use as a landlord or a tenant. Therefore, the purpose of this article is to provide a basic understanding of leases and their covenants, lease termination procedures, responsibilities for repairs and rules regarding security deposits.
A lease is an agreement between a landlord and a tenant which gives the tenant the legal right to possess and use the landlord's property. At minimum, a lease should identify the property to be leased, the term of the lease, the amount of the rent and the time and manner of payment of the rent. A written lease should be signed by both parties. The lease may also contain covenants by the landlord and the tenant to behave in a certain manner. Breach of a covenant may affect the right to possess the property or may allow the other party to claim money damages.
A lease is a conveyance of real property and a contract. Principles of both property law and contract law come into play in interpreting and enforcing leases. Historically, property law rules dominated the law of landlord and tenant. However, in the last quarter century Colorado courts have given an increasing role to contract concepts such as anticipatory repudiation, mitigation of damages and set-off.(fn1)
A short-term lease may be written or oral, but the statute of frauds makes oral leases for a period of one year or more void.(fn2) The statute requires that there be a "contract or some note or memorandum" in writing and signed by the tenant. However, a tenant who takes possession of the property and makes substantial improvements in reliance on the lease may be able to enforce an oral lease (or other lease in violation of the statute of frauds) against the landlord.(fn3) A lease that is under the statute of frauds must also be modified in writing, unless less than one year of the lease term remains.(fn4)
Leases typically contain a variety of covenants or promises which affect the rights of the parties. Under property law principles, some covenants are said to "run with the land," i.e., they bind an assignee (by virtue of the doctrine of "privity of estate") who was not a party to the original lease (and thus is not in "privity of contract"). The covenant to pay rent and the covenant to return the property in a certain condition are among those that "run with the land."(fn5)
Some covenants which are commonly found in leases are unenforceable or void. However, neither the landlord nor the tenant may be aware of this. Other covenants are quite lawful and enforceable and may bind the unwary or unobservant in an undesired fashion. The following types of covenants are often used.
Cleaning clauses are clauses in which the tenant agrees to employ the landlord to complete any cleaning left undone by the tenant after the tenant vacates. They are generally enforceable, but cannot be used to charge the tenant for "ordinary wear and tear."(fn6)
The general rule is that an eviction terminates the lease and all obligations under the lease. However, if the tenant agrees in the lease to remain liable for the rent after an eviction, this covenant is enforceable.(fn7)
A covenant prohibiting assignment or subletting or requiring the tenant to obtain the landlord's consent is enforceable.(fn8)
When a tenant agrees in a lease to abide by all future rules and regulations imposed by the landlord, the landlord
has the power to draw up any reasonable rules.(fn9)
The general rule is that a landlord is not responsible for repairs to the property unless the lease so specifies.(fn10) When the landlord does agree to make repairs, this is an enforceable covenant.
Covenants that hold the tenant responsible for costs of legal actions necessary to enforce the lease are generally enforceable.(fn11)
A covenant purporting to waive any portion of the Colorado Security Deposit Act ("Deposit Act") is void.(fn12)
The sole means for evicting a tenant is by an action in unlawful detainer. Self-help evictions are not lawful and cannot be agreed to in a lease. Moreover, any covenant waiving the three-day notice required by the unlawful detainer statute is void.(fn13)
Exculpatory covenants will be strictly scrutinized by any court and will not protect a landlord guilty of willful or wanton negligence.(fn14)
When a tenant agrees to confess judgment in the event the tenant is sued by the landlord, the covenant is valid, but may be avoided if the tenant has a valid defense.(fn15)
A covenant by which either party waives the right to appeal is void.(fn16)
A "no-oral-modification" clause in a lease is enforceable but may be waived orally or by conduct, allowing the lease to be modified orally.(fn17)
The breach of any enforceable covenant creates a right of action in the party for whose benefit the covenant was intended. Any breach may be waived by either word or conduct.(fn18)
By statute, a tenant in possession is presumed to be a tenant at will (for no definite period) until the contrary is shown. However, courts in Colorado have a tendency to find a periodic tenancy (from one period to another) rather than a tenancy at will. If there is no explicit agreement as to the term, but the rent is payable at monthly intervals, a month-to-month tenancy will be found. A month-to-month tenancy is a rental agreement for one month which is automatically renewed each month unless either the landlord or the tenant gives the other notice of intent to terminate.(fn19)
If a tenant "holds over" after a lease of one year or more and the landlord accepts rent, the tenancy will be interpreted as one for year-to-year, unless the lease specifies otherwise.(fn20)
In an assignment of a lease, the tenant transfers his or her entire interest in the lease to the assignee, but in a sublease, the tenant retains an interest by imposing some obligation on the sublessee or by reserving a portion of the term or property covered by the lease.(fn21)
A lease may be assigned or sublet unless the lease contains a covenant to the contrary. When the lease requires consent of the landlord to sublet or assign the lease, consent may be withheld arbitrarily unless the lease states otherwise.(fn22)
For the most part, Colorado continues to follow the common law rule that repairs are the responsibility of the tenant unless the lease provides otherwise.(fn23) However, the Colorado legislature recently added a section to the Deposit Act(fn24) which places the burden for making certain repairs on a residential landlord. Under this new section, entitled the Gas Equipment Hazards Act ("Gas Act"), the landlord has seventy-two hours after receiving notice to have a professional make any repairs necessary to alleviate a "hazardous condition of a gas appliance, piping or other gas equipment."(fn25) If the landlord fails to make the deadline, the tenant may move out, the lease becomes null and void, and the security deposit must be returned to the tenant within seventy-two hours after the tenant vacates.
As noted, the general rule in Colorado is that a landlord is not responsible for making repairs unless there is a covenant in the lease to that effect. The Gas Act is the only statutory exception; the Colorado Supreme Court has carved out few others.(fn26) If the landlord does agree in the lease to make repairs, the landlord is responsible for making them in a timely and careful manner after notice from the tenant. If the landlord does not do so, the tenant may make the necessary repairs and deduct the costs from the rent, unless deductions are prohibited by the lease.(fn27) The tenant may also sue the landlord for breach of the covenant to repair.
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