Tuesday, May 10, 2011

Location, Location, Location - and REGISTER!

If you own real estate in Maryland to rent out, read your county code requirements.
Tom Baranowsky did not, or he thought he'd save some money by not registering his rental condo in Anne Arundel County. It ended up costing him quite a bit in the long run.
Tom was not able to evict his tenant when she did not pay rent.

To register, and get a license to operate a multi-family dwelling, such as Tom's in Anne Arundel County, means to have the place inspected for safety and habitability by the county.
Technically, Tom had gotten such a license, but these are not permanent things. His had expired in 2005. The county contacted him thereafter (on 5 separate occasions) asking him to renew in order to be able to operate, but he did not attempt to renew until May 21 2009.

But on March 12, 2009, he had rented the property to Katie McDaniel.
Katie almost immediately discovered a short in the fuse box. She tried to get Tom to fix it. She called the fire department and they told her to move out as it was unsafe - but Katie had no place to go. There were also missing window locks and broken windows, and the kitchen countertop was never secured to the cabinets. Definitely unsafe for Katie and her young daughter.

In April a county inspector told Tom of those and numerous other safety violations. The same day of the inspection Tom filed suit to evict Katie because she had not paid rent for April 12 - May 12.

While the district court found for Tom, he lost on appeal.
The Court of Appeals ruled May 4 2011 that failure to license under the county rules undermines his legal status as landlord and thus denies him access to the expedited eviction process of the law.
He should have lost on the eviction case and the case was remanded to deal with the rent.

The moral is, check the local codes and get whatever licenses you need. It may cost a little now, but better than costing a lot later.

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