As a new landlord, I developed my own tenant-landlord contract. I wanted the tenant to pay all utilties so I include a phrase that says,

"The tenant shall pay all utilities including, but not limited to electrical, telephone, gas and sewer."

I am also hooked up to a water meter (one of the few places in the neighbourhood. This is because the flat rate was an average based on property size. I have a large property with a small house. My neighbours live in mansions that go from property line to property line. My water meter saves $200 on the water and sewage/ year.

The problem is that my tenant was reluctant to pay the first water and sewage bill (it comes 4Xper year instead of anually). I showed the contract and they paid for it. I received the property annual utility bill that had the water, sewer and meter rental for the last 3 months ($45) and included trash disposal ($315) and city sewer ($50). They told me that they have never had to pay this before. The bill is in my name (as property owner).

So my question is, who pays? Your comments are welcomed.

If they signed the lease they should have to pay it

How well did you explain this when they signed the lease ? Did you tell them at all, or just have it in the written part of the lease.

Next is any of the bill for a time when they were not in the house, for example if the bill is for 3 months, and they only lived in there for 2, they would only owe for their percentage of the bill, not the entire bill.

Yes you can make them pay, but it should have been very clear.

I will assume you are not in the united states where it is customary for poeople to pay their own utilities

I let my wife rent the place for spending money and I pay the bills.

Did she explain the lease to the tenants- heck no. I bet she didn't even realize we pay for those services!

Here's the corker. I did not have the tenants pay for any pro-rated utilities when they moved in. In fact, I forgot about the water, sewer and all the property utilities until I received the bill. I was about to pay them when my wife brought to my attention that the lease stated the tenants were responsible- and they had no disputes about paying a $40 water and sewer bill every 3 months.

I paid the property utility bill (because it was in my name). I meet with them at the end of the month (I live far away) to discuss this so I would like to know if I should compromise and pay for some or stick rigid to the contract and not open a can of worms by breaking the contract.

I would compromise. The water and sewer bills are easily recognized as utilities and should be understood as being the tenant's responsibility from your lease clause. But the trash disposal bill might be a little more difficult. Is trash disposal considered a utility in your location? I am temporarily living in a rented townhouse. In this town 90% of trash removal is public and is paid for by property taxes. But rental complexes have private trash removal and the cost is included in my rent. I pay for all utilities, including water and sewer, but not trash removal. It is not considered a utility.

So if you chose to pursue this, and if the tenant refuses to pay for trash removal you would have to file a lawsuit for non-payment. The issue then becomes, will the judge consider trash removal to be a utility and therefore required to be paid by the tenant as part of the lease?

If you are not living hand-to-mouth and can afford the bill I would let the trash removal go this time around, but make sure to include it in the next version of the written lease.

Whatever they are expected to pay better be an account in their name. In certain states in the US, landlords are required to pay the water and trash no matter what... something about it being connected to the property, not the occupants. But everything else is shut off and the tenants are the ones who get it turned on... in their name. You just might want to check about the laws in your area concerning water and trash since there would be the possibility of being sued for illegal collection, regardless of any contract signed.

This is not my primary source of income.

As suggested, the property utilities are attached to the owner and cannot be transferred into the tenants names.

I will not seek from them the city sewer or trash disposal$365/year) but I will expect them to continue pay for the water utilities because they have been doing that since they moved in ($45/3 months).

I would say that is fair and reasonable and uncontestible in court!

Hello bhane:

And, that's how things wind up in court. ONE side thinks their solution is "fair and reasonable" and "uncontestable". But guess what? The other side might not agree, and it is, Sir, absolutely contestable.

I'm not suggesting that your solution ISN'T fair. I'm just suggesting that it be negotiated and discussed with your tenants. Indeed, that's where the problem started in the first place. There was a mis-understanding. I think you need to make your arrangement with your tenants as clear as possible.

That said, I think you are being unfair. The term "utilities", would NOT include rental on the meter. It may not be much, but the cost of measuing a utility, is NOT a utility and you should pay it. Plus, as has been previously suggested, "utilities" may not include trash pickup

Plus, it's stuff like this, that causes a perfectly good landlord/tenant arrangement to go into the toilet. The bottom line is, you are in the landlord business. Your tenant's are your customers. Sure, you can be rigid, and right, but you're not going to have very happy tenants. And, unhappy tenants can cost you bigtime.

excon

PS> As a new landlord, you should be required to see the movie "Pacific Heights", I think.

When you pay gas utilities, you pay for rental of the meter and for the meter reading.

When you pay electric utilities, you pay for rental of the meter and for the meter reading.

It is reasonable to consider that when you have agreed to pay water utilities (that adjusts according to your usage), you also agree to pay for rental of the meter and for the meter reading.

I am a senior engineer and if I cannot stand by my reasonable judgement, we're all in a lot of trouble!

I believe it best be included in the rent if it can't be in the renter's name or risk being caught in a legal mess. If I were the renter, I would not be willing to pay if the account was not in my name but if your tenants don't mind, cie la vie.

My MIL rents and the utilities stay in her name, she charges a 500.00 deposit
To cover cleaning damage and unpaid utilities. There are people out there that can not get utilities in their own name due to bad credit or what have you.
I totally agree with the Pacific Heights suggestion! I would never rent after seeing that movie!

As far as the contract.. it must be written word for word as to what the tenants are expected to pay, the " not limited to" phrase is too vauge and will not hold up in court.

Hello again bhane:

>>> As suggested, the property utilities are attached to the owner and cannot be transferred into the tenants names.<<<

Please site your source for this information. Please also tell me the state where the residence is located and I’ll do some of my own research. You said the above with such certitude, that I didn’t challenge it earlier. However, I do now. Indeed, in every state that I’ve lived in and rented a house, putting the utilities in my name was never a problem. In fact, the landlord insisted on it. Because if it didn’t get paid, it was the TENANT whose credit got dinged, and it was the TENANT who got their electricity cut off. The landlord had nothing whatsoever to do with any of those transactions, and that’s as it should be.

I have a sense that you may view my post as an affront. Especially since I have no qualifications at all. This is not my intent. My intent is to help guide you into a successful and profitable venture into the landlord business.

excon

The property is in Richmond, BC Canada. Some utilities that are billed directly to the owners. This includeds water, residential sewer, city sewer and trash removal.

Usually, we are billed annually. However, I had a water meter installed a year ago and I now get a water meter bill every 3 months.

Every other utility, including but not limited to electrical, gas, telephone and cable, is in their name!

Well, I guess reasoning wins out. I aproached them with the deal that I would pay the City's annual utilities (garbage removal and city sewer at $365 per annum) and they would continue to pay monthly water and sewer utilities ($45 every 3 months). They agreed.

All the above utilities are registered in the property owner's name and are not transferable.

Let's hope its written in as part of the rental contract or I can just hear the Canadian version of Judge Judy saying to someone, "Next time get it in writing!" :p

You should not have to explain the lease or read it to your tenants. If was their responsibility to do that on their own. The bigger question is what is the terms of the lease, and if they refuse to pay their portion of the utilities, are you willing to evict or not renew their lease? Some tenants will play the ignorant card every chance they get. They know what they agreed to, if not then, then now.

I believe you should have your lease "blessed" by an attorney rather than "creating" one on your own... you don't have the expertise or depth of knowledge to create your own lease.

Get your local Realtor lease and your local apt association lease so that you can see how they are properly worded.

Yes, you should have explained the utility billing procedure to your residents... and you should have a clause in your lease that utility bills are to be reimbursed to you within 5 days of your providing copies of the bills or the charge will become rent (this is so that you can EVICT them for non-payment of the utilities).

You need education and guidance on how to handle resident concerns.

There has been some question as to whether there are communities where Utiliites cannot be under the tenants name. I can tell you for a fact that within Allegheny county in Pennsylvania and many other countys the waterboard will not bill tenants directly. The landlord gets the water bill and forwards it to the tenant. The other option is to include it in the rent (never a good idea). In these comunities where the water bill is not transferable the water bill is either leanable to the property or not leanable.

I can report that I have rented property on more than one occasion in several US states where the water and garbage bill could only be in the property owner's name. In each situation the cost of the water/garbage was either considered included in the rent or the rent was high enough to produce profit to cover it. I have never experienced it firsthand or seen it passed on to the tenant who was expected to pay a bill that was not in their name. I am not saying it doesn't happen but it didn't happen in the places where I rented property. It was clearly the practice that the only utility bills that a tenant would be resposible for were ones that could be transferred into the tenant's name. My guess is, if it could have been arranged legally to pass on the water/garbage bills to the tenant, it would have been. Because of tremendous variance in these laws, I believe its best to know the all applicable laws of the land specifically.