Chicago Residential Leasing - LANDLORDS BEWARE

Posted over 2 years ago. Applies to Chicago, IL, 3 helpful votes

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I can not tell you how many landlords who have rental properties in Chicago contact me about handling an eviction for them only to find out that the leases they are using do not comply with the Chicago Residential Landlord & Tenant Ordinance.

This Ordinance, which you can review at http://www.chicityclerk.com/tenantsVRSlandlords.php , significantly reshuffles the obligations of the landlord and tenant in many ways "in favor of" the tenant.

The Ordinance, with some exceptions for rentals like hotels and dormitories, applies to EVERY Chicago residential rental other than owner-occupied buildings with 6 units or less.

Here are some of the basics that can "make or break" an eviction case:

  1. The lease must tell the tenant WHERE the landlord has deposited the tenant's security deposit, and requires the landlord to pay or credit interest annually on that portion NOT used to cure tenant defaults. There are more requirements, but in the end if you as the landlord do NOT comply and then attempt to sue a tenant for non-payment of rent, the tenant "shall be" awarded damages equal to TWO TIMES the amount of the security deposit, which can "trump" the rent claim.

  2. The lease MUST attach an approved form of "Summary" of the Ordinance. Failure to attach the summary can result in a $150.00 fine.

  3. If the landlord does not notify the tenant, at or prior to making a lease, of the name, address AND telephone number of the owner and whoever the owner may have designated as a manaing agent, the tenant can TERMINATE the lease.

  4. Leases that say the tenant is obligated to pay the landlord's attorney fees in case of litigation over the tenancy, are NOT allowed AND, if the tenant has actually paid any such fees, the tenant can sue and recover them as actual damages. On the other hand, if there is a lawsuit there is a prevailing party rule EXCEPT in eviction cases. So whether the landlord wins or loses in an eviction case, the landlord can not get its attorneys' fees covered by the tenant.

  5. Like Illinois State law, the tenant has rights to make certain repairs the landlord fails to make after applicable notice AND deduct a portion of the cost from rent. Unlike State law, the Ordinance gives the tenant the right and a PROCEDURE to terminate the lease for specific failures. Terminating a lease because a tenant has lodged a complaint is deemed "retaliatory" and is also not allowed.

In addition, if a landlord sues a tenant for non-payment of rent, the tenant can demand a jury trial and, if there are repair issues with the rental unit, continue to live in the unit but still claim the condition has breached the "implied warranty of habitability" which has diminished the rental value of the unit, which can undermine the rent claim.

I am not here to advocate for landlords who are "bad" landlords. I am just providing this short "introduction" to the fact that as a landlord in Chicago, you have many responsibilities and run the risk of weakening, or destroying your own claims against a "bad" tenant, if you don't observe the Chicago Residential Landlord & Tenant Ordinance.

Additional Resources

A handy guide for Chicago landlords can be found at: http://www.domu.com/landlord-guide

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