Distraint for Rent or Garnishment - Kentucky Law

This is a very long explanation of not very much.

Residential landlord and tenant law is complicated in Kentucky because the Uniform  Landlord and Tenant Act (URLTA), as enacted  by the Kentucky legislature, applies to residential renters in some parts of the Commonwealth, but not in other parts. In Kentucky, URLTA is available as a local government option, to be enacted as local governments see fit, or not. Consequently, whether the provisions apply to any particular residential tenancy depends upon the geographic location of the residence. Generally speaking, the larger urban centers in Kentucky, such as Louisville and Lexington, have locally adopted URLTA but the more rural areas have not.

The URLTA provisions do not apply to commercial and agricultural renters, wherever they may be located in the Commonwealth. URLTA applies only to residential tenancies in areas that have adopted that law locally.

Kentucky landlords have a statutory lien for unpaid rent on the tenant’s personal property, which may be recovered by attachment or by action, KRS 383.010, et seq., even if the rent debtor’s property is in the possession of a third party. KRS 383.020(1) states, “A distress warrant or attachment for rent shall bind, and may be levied upon, any personal property of the original tenant found in the county . . . .” This language indicates the subject personal property of the rent debtor does not necessarily have to be found on the leased premises. This landlord remedy is traditionally known as distraint for rent. The URLTA, on the other hand, abolishes distraint for rent, KRS 383.680, for residential tenants, in those areas where URLTA applies.

Seizing a person’s personal property in the hands of a third party to satisfy a debt for rent has the same look and feel as does a non-wage garnishment, but it has an entirely different statutory foundation.

Notes: Appeal of a Kentucky eviction

Background

When a Kentucky landlord wishes to regain possession of real estate occupied by an uncooperative tenant, there is a special statutory procedure called Forcible Entry and Detainer, KRS § 383.200, et seq.. This is commonly known as an action for eviction. The law of Forcible Entry and Detainer applies uniformly throughout the Commonwealth to residential, commercial and agricultural tenancies, and an essential element of a landlord's action is to establish the tenant's possession of the property is wrongful.

The applicability of Kentucky's Uniform Residential Landlord and Tenant Act,  KRS § 383.505, et seq., however, is subject to adoption by local governments, see: KRS § 383.500. Thus, determining if and when a the tenant's possession of the property is wrongful is complicated by its geographic location, if the occupancy is "residential," landlord's compliance with the appropriate notice requirements and the terms of any written or oral agreements.

Landlord's Statutory Cause of Action In District Court

Let us set these issues aside, and simply assume a landlord can make a good faith claim the tenant's possession of the premises is wrongful. If a tenant wrongfully refuses to surrender possession of a premise, a landlord can file a complaint in District Court under KRS § 383.210. There is a standard court approved form for this: Forcible Detainer Complaint. The tenant must be given at least three (3) days advance notice of a hearing. Either party may make written demand for a jury "at the calling of the case for trial," KRS § 383.210(2). The issues will be decided by either the jury or by the judge, and a final judgment will be entered in favor of one party or the other, on the issue of possession. Issues other than wrongful occupancy and possession of a property normally cannot be included in a Forcible Detainer Action. However, I have previously speculated if Kentucky's Uniform Residential Landlord and Tenant Act might complicate the inherent straightforward simplicity of an action for Forcible Detainer. See:  Fantasy Litigation - Forcible Entry and Detainer vs. URLTA.

Notes: Appeal from District Court to Circuit Court

1. KRS § 383.255 and the Kentucky Rules of Civil Procedure, Rule 72.02, allow seven (7) days after the District Court's final judgment within which to file a Notice of Appeal in the original District Court cause..
2. Civil Rule 72.02(1) provides: "Appeals from the district court to the circuit court in civil cases shall be taken by filing a notice of appeal in the district court and paying the filing fee required by KRS 23A.210."
3. Unfortunately. it appears that KRS 23A.210 was repealed in 1999, so the full meaning of CR 72.02(1) remains unclear and it will likely require a trip to a law library. Yikes!
4. KRS § 383.255(1) requires a tenant to deposit all past due rents, and future rents as they become due during the pendency of the appeal, with the Clerk of the Circuit Court.
5. Upon tenant's deposit of rents with the Circuit Court Clerk, the "court shall stay all further proceedings on the inquisition." KRS § 383.255(2).
6. CR 72.04 provides, "The record on appeal to the circuit court shall consist of the entire original record of proceedings in the district court, including untranscribed mechanical recordings made under the supervision and remaining in the custody of the district court or clerk. . . . " 
7. In addition to paying all rents to the Circuit Court Clerk, to perfect an appeal the tenant must file a Statement of Appeal as specified in CR 72.10.
8. Time for perfecting appeal: CR 72.08 provides, "An appeal from the district court must be perfected within 30 days after the date of filing the first notice of appeal."
9. As a general rule, not much by way of facts or law can be successfully argued on appeal which were not first fully presented to the trial judge and made part of the record.

When 30 Days Is Not Thirty Days - More Landlord & Tenant

There are three types of month-to-month residential tenants. First, there is the type who understands a 30-day notice means thirty days before the beginning of the next month. Second, there is the type that thinks a 30-day notice means thirty days from the date of the notice, whenever it is given. Finally, there is the type that believes notice is for suckers and who reads stinking rental agreements anyway?

Kentucky's Uniform Residential Landlord and Tenant Act (URLTA) K.R.S. §383.695(2) - Periodic tenancy - Holdover remedies, provides:

"The landlord or the tenant may terminate a month-to-month tenancy by a written notice given to the other at least thirty (30) days before the periodic rental date specified in the notice." [Emphasis added]

I'll stick my neck out and surmise this means a month-to-month tenancy that runs from the first of each month can be terminated by written notice given thirty days or more before the beginning of the next month. So, if this is the case and notice is given, say for example, on the 7th of any month, the tenant is still contractually obligated for a full month's rent in the following month. (See note below.)

Apart for the statutory language, "(30) days before the periodic rental date," reference to a rental date, also consider  K.R.S. §383.675 - Waiver of landlord's right to terminate:

"Acceptance of rent with knowledge of a default by the tenant or acceptance of performance by him that varies from the terms of the rental agreement constitutes a waiver of the landlord's right to terminate the rental agreement for that breach, unless otherwise agreed after the breach has occurred."

Imagine the hypothetical where a landlord wishes to terminate a month-to-month rental and gives a 30-day notice on the 15th of a month. If the rental terminated 30 days after the notice, the landlord would clearly be entitled to demand and receive pro-rated rent for the two week spill-over into the following month, but accepting less than a full month's rent would work as a waiver of the termination.

The 30-day notice is not a termination of the rental agreement. The 30-day notice is a termination of a right to renew the rental agreement for another month.

You might think this is easy to understand it this way, but apparently that is not always so. I have seen rental agreement provisions like this:

" . . . . the lease will become a month-to-month lease subject to 30 day written notice by either party of non-renewal."

This says basically the same thing as §383.695(2), but it is not an improvement.

Questing for clear understandings, I tentatively propose the following rental agreement language:

"At the end of the rental period covered by this agreement, this lease will automatically renew in one month increments beginning on the ___ day of each month. Either party may stop this rental agreement from renewing automatically by giving written notice of non-renewal to the other party at least thirty (30) days before the beginning of the next rental period. If notice is not delivered to landlord a full 30 days before the beginning of the next monthly renewal date, tenant remains obligated to pay rent for the next full month."

Another variation:

This lease shall be for a term beginning ______ and ending ______, after which time this lease will become a month-to-month lease from the first day of each succeeding month, subject to written notice of non-renewal by either party. To be effective, such written notice must be delivered to the other party at least thirty (30) days in advance of the first day for any month for non-renewal. This provision may be waived by mutual agreement of the parties.

As always, there are weird permutations I have not considered. Caveat emptor.

Note: One hitch in this is the seven-twelfths of the year with 31 day months. A thirty day notice given on August 1, for example, will be effective before the beginning of September.

Before and After. Residential Tenant Security Deposits

What system does Kentucky's enactment of the Uniform Residential Landlord and Tenant Act (URLTA) provide for documenting tenant-caused damages to the premises, and why do I always refer to "Kentucky's enactment" of the URLTA, and not just the URLTA?

The second question is first, and my answer is another question. What are the odds that Kentucky enacted the URLTA exactly as the Uniform Law Commission presented it, with zero tweaks, and it is just the same in Kentucky as it is in any other state that has adopted it? The answer is, I don't know and I don't like to gamble.

The easy way to answer the first question is to quote K.R.S. §383.560(2) - (3)

(2) Prior to tendering any consideration deemed to be a security deposit, the prospective tenant shall be presented with a comprehensive listing of any then-existing damage to the unit which would be the basis for a charge against the security deposit and the estimated dollar cost of repairing such damage. The tenant shall have the right to inspect the premises to ascertain the accuracy of such listing prior to taking occupancy. The landlord and the tenant shall sign the listing, which signatures shall be conclusive evidence of the accuracy of such listing, but shall not be construed to be conclusive to latent defects. If the tenant shall refuse to sign such listing, he shall state specifically in writing the items on the list to which he dissents, and shall sign such statement of dissent. 

(3) At the termination of occupancy, the landlord shall inspect the premises and compile a comprehensive listing of any damage to the unit which is the basis for any charge against the security deposit and the estimated dollar cost of repairing such damage. The tenant shall then have the right to inspect the premises to ascertain the accuracy of such listing. The landlord and the tenant shall sign the listing, which signatures shall be conclusive evidence of the accuracy of such listing. If the tenant shall refuse to sign such listing, he shall state specifically in writing the items on the list to which he dissents, and shall sign such statement of dissent.

Answering the first question begets the next question: What the hell does this mean?

Clearly, the intention is to document the condition of the premises at the beginning of the tenant's occupancy and then again at the end of occupancy; and to give the tenant the opportunity to either agree or disagree with the landlord's assessment of each, and to make a record of any disagreement .

The procedure in the statute strikes me as antiquated and excessively clunky, but I will not go into the details as to why I think this. Here in the 21st Century when digital photography is cheap, easy and ubiquitous, simply photographing any preexisting damage and having both parties to sign off on the collection of photos would be sufficient to substantially satisfy the spirit and intention of the URLTA, while ignoring the literal requirements of the section. This is my opinion only.

There is not an abundance of Kentucky caselaw on the subject.

Never mind, I take it back. It's not a good idea to blatantly ignore the clear language of a duly enacted law in the Commonwealth of Kentucky. It's not a good habit to get into. But the statutory language, "estimated dollar cost of repairing such damage," is difficult to implement in practice.

Obviously, if the estimated repair cost of damage existing at the beginning of a tenancy is the same as the estimated cost of repair at the end of a tenancy, then the tenant did nothing to elevate the repair cost during the tenancy. But the reverse is not necessarily true.

Estimating repair costs is difficult and inexact. It is difficult and inexact for a landlord, and it is even more difficult for a tenant. The fact of the matter is that the landlord opted not to have the existing damage repaired and the tenant chose to enter a rental agreement and occupancy with knowledge of the existing damage.  It is very likely that two different people at two different times would come up with two different estimates for the cost to repair the exact same damage.

There are two separate related questions. Did the tenant damage the premises during the course of the tenancy and how much should the landlord be compensated for this damage.

Before and after photographs of the premises would be very useful to avoid or resolve landlord tenant disputes about damages. This would be in addition to the clunky mechanism provided by statute.

Notice of Residential Security Trust Deposit: Form

Kentucky Revised Statute. §383.580(1), in effect for Jefferson County, Kentucky, requires residential landlords to:

1. Deposit all tenants’ security deposits in an account used only for that purpose, and 
2. To inform the tenant of the location of that separate account and the account number.

This is the form I use to document the deposit:

Notice of Residential Security Trust Deposit: Form by Tom Fox