B. The Nature of the Rental Agreement

If you were in law school, they would be teaching you that the landlord tenant relationship is part property law, and part contract law. You would also be drinking a lot of beer and having a great time except during exams. But you are probably not in law school, or you would have been paying a lot more for books that would tell you the same thing as this one, just in a more convoluted way. It is true that a tenancy is a type of estate in land, and it is also true that rental agreements in Ohio are interpreted and enforced by the courts pursuant to the law of contracts.

In Ohio, there are two sources of law which govern the terms of rental agreements (also known as leases). The first source of law is the Ohio Revised Code [this is what the Legislature gets together to vote on from time to time], specifically, the Ohio Landlord Tenant Act of 1974 and cases interpreting it. The second source of law is the rental agreement between the parties. Sometimes the two sources of law conflict. When that happens, the Code and cases interpreting the Code win over the rental agreement’s provisions. This only makes sense. If you are stupid enough, you can sign a contract with someone wherein you promise to kill a man for Five Hundred Dollars. But that doesn’t mean that the courts will enforce contractual provisions that are contrary to the laws of the State of Ohio.

Text taken from the Ohio Landlord Tenant Act of 1974 will appear in the chapters that deal with the applicable legal issues. You may not understand the statute perfectly upon first reading (I know I didn’t and I’m an attorney), but with luck as you read my explanation of it and see how it relates to your problem, the big picture will reveal itself to you. But in this section, I will deal with rental agreements, their important provisions, and how they work.

1. Rental Agreements Are Contracts

At their foundation, rental agreements are contracts, and they are interpreted the same as any other contracts. As the Eighth District Court of Appeals stated in the case of Kacik v. Paris, 1992 Ohio App. LEXIS 11671 (July 22, 1982) Cuyahoga App. No. 44271, unreported:

It is well established that a written lease is both a conveyance of a property interest and a contract, and that the rights and obligations of the parties are determined according to the law of contracts. 3A Corbin, Contracts Sec. 686 (3rd Ed. 1960).

A contract is a promise that Courts will enforce. A court will not enforce a promise to kill a man. Therefore, this is not a contract, despite mafia terminology wherein they “put out a contract on the guy. ” The court will also not enforce a promise from your aunt to pay for your college education standing alone by itself. This will be found to be a gratuitous promise, not a contract.

You are probably wondering then what turns a promise into a contract. Promises become contracts when the three elements of any contract exist. The three elements of a contract are; offer, acceptance, and consideration. Sometimes, there is something called reliance that can be a substitute for consideration. When your landlord presents you with a rental agreement for your signature, that is an offer. When you sign it, that is an acceptance. When you give her a security deposit and the first month’s rent, and she gives you the keys and possession, that is consideration (also known as the bargained for exchange between the parties). The three
elements are present. Congratulations. You have a contract.

Another thing to know about contracts is that they can be either express or implied. An express contract arises when two people spell out their agreement in words, either spoken words (an oral contract) or written words (a written contract). Most of us are familiar with express contracts.

Implied contracts do not arise from an express (spoken or written) agreement between the parties, but rather they arise from the conduct of the parties. An example of this is if you walked into a barber shop, sat down in the chair without a word, and the barber cut your hair for you. At the end of the haircut, you couldn’t just get up and walk away. You wouldn’t be able to argue in court that you never had a spoken or written agreement with the barber. The Court would award the barber the fair price of the haircut if the barber sued you. The Court would find that there was an implied contract from your actions. The Court would find that your action of getting into the chair at the barbershop constituted an offer, and the barber cutting your hair constituted an acceptance. The service provided and received would serve as the consideration for the contract. Now you have the three elements of any contract, offer, acceptance and consideration.

An example of an implied contract that arises out of landlord tenant law would likely be found in the context of a holdover tenancy. When a tenant holds over beyond the lease term and pays rent according to the former terms, the law implies a contract on the tenant’s part to hold over for an additional term under the same conditions which governed the prior term. Bumiller v. Walker (1917), 95 Ohio St. 344, 348-349, 116 N.E. 797. But we’ll deal mostly with express contracts here.

As I stated before, there are two types of express contracts, oral and written. As you might have guessed, a rental agreement, also called a lease (herein these terms will be used interchangeably), is a contract between the parties, wherein the landlord makes an offer (to allow you to stay at the apartment for a certain time and a certain price) and your signature on the lease is an acceptance of those terms. The rent you pay and the space provided to you make up the consideration for the contract. Voila, the three elements.

Without a written agreement, the court is going to attempt to determine whether there is an oral contract. In doing this, it will listen to the testimony of both parties to see if there has been an offer, an acceptance, and consideration. The Court will also listen to the testimony of the parties to make findings as to the terms of the contract. Naturally, both parties might have different memories of what the agreed rent was, how much of the building gets to be used, what was promised to be fixed and by whom and when, and so on depending upon the circumstances of each individual case. To avoid these problems, it’s nice to have a written document that spells out the promises made by the parties. That is why most rental agreements are in writing.

An oral contract is just as enforceable as a written contract, it’s just harder (but not impossible) to prove the terms. An oral rental agreement is enforceable, but if the lease term is to run for three years or more, it has to be in writing. It also has to be witnessed by two persons and the signatures of those witnesses and the signatures of the parties on the rental agreement must be notarized. Ohio Revised Code Section 5301.05 requires this. Lastly, the lease has to be filed with the County Recorder. Most residential leases are for one year or less, and so if your lease is oral, it is likely still enforceable, provided of course, you can prove its terms and elements.

a. Written Rental Agreements and Their Clauses

Most rental agreements are in writing. For any writing to be enforceable, it must be signed by the party against whom it is to be enforced. The nice thing about having your lease in writing is that it is very simple to prove to the Judge what you and the landlord previously agreed. The problem with written leases is that they are usually drafted by the landlord and they contain language that favors the landlord in every way, shape and manner.

1) Ambiguities

But the party who does not draft the rental agreement (listen up, that’s you) does have some advantages. No matter how carefully a sneaky low down good for nothing just-breathingmy-air lawyer writes a contract for someone, there are always unforeseen circumstances or problems. This means that sometimes a contract can be ambiguous in its terms. If the contract states that the landlord will install new carpet in the living room within a reasonable time of the tenant’s moving in, how long does he have? Here you have an ambiguity. The tenant thinks that a reasonable time would be about a week (because he has to hold off on moving furniture into his
living room until the new carpet is installed). The landlord thinks that a reasonable time is six months because that will give him time to find a good price on carpet, and free up his maintenance people to install it.

In the case of an ambiguity in a contract, the Court will first determine if the term really is ambiguous. This involves examining each party’s interpretation and seeing if those interpretations are reasonable or not. If the Court finds that both parties’ interpretations of the ambiguous clause are reasonable, the Court will then ask who drafted the contract (meaning, who provided the contract for the other party to sign). Usually, that’s the landlord.

Ambiguities in contracts are construed against their drafters. The reason is that the person who wrote the contract was in the best position to say what he meant. The court will not punish the person who didn’t write the contract just because the person who did draft it didn’t take enough time to be clear about things. As the Ohio Supreme Court so eloquently waxed in the case of Smith v. The Eliza Jennings Home (1964) 176 Ohio St. 351:

Under such circumstances, the well-established rule that where there is doubt or ambiguity in the language of a contract it will be construed strictly against the party who prepared it is applicable. 11 Ohio Jurisprudence (2d), 391, Contracts, Section 147; 17A Corpus Juris Secundum, 217, Contracts, Section 324.

The good news for the tenant is that if there is something ambiguous in your contract, and you have taken a reasonable position on the matter, you will likely win the debate in front of a judge.

As another example of this, let’s say that your rental agreement allows only blue curtains to be displayed in the front windows. You put up a dark blue curtain with a lighter blue lightning bolt running down the middle of it. Your landlord complains to you that the lease says only blue curtains, and that this means solid blue curtains. You say that when you signed the lease, you took it to mean that so long as the curtains were blue, they could have any type of colors therein, so long as they were all blue. Here we have an ambiguity. If the Court finds that your
interpretation of the ambiguous clause is reasonable, then your interpretation wins since the landlord was the one who drafted the contract, and he should have taken better care to say what he meant.