Property application contract dispute (hypothetical)

In My Humble Opinion
1

This is a hypothetical case in the sense that I have no interest in pursuing it and no longer have documentation to do so if I did. So this is purely in the interest ofBut to the best of my recollection, this did actually happen this way.

A number of years ago, I was looking for an apartment with a buddy of mine, and we found one that wasn’t perfect, but it was ok. We applied and the property manager told us he did applications in the following way:

We paid $200. Some amount (I think $20) would be used for the credit check. We would be notified of approval in writing within 3 days. If we were notified of approval, the balance $180 went toward the first months rent, and we had to produce a check for the rest in a short period of time (a few days. I don’t remember exactly), or the balance would be forfeited and he’d process someone else’s application. If we were not notified of approval, the balance would be returned. The agreement we signed explicitly said that it only counted if we were notified in writing.

The reason he gave us for this was that since he was holding the apartment for us while running the application, he wanted us to have some skin in the game. Basically, if we got approved and decided not to do it, he got paid for his effort and for holding the apartment.

Well, it turns out we found a much better place right after placing this deposit, and we ended up renting that one.

He called on the 3rd day after our application, and told us we were approved, and I told him my roommate was busy with something and couldn’t sign the papers that day. He accused me of jerking him around, and I said I’d call him the next day when we were both free.

The next day I called and told him we weren’t taking the apartment, and since we hadn’t been notified in writing within the time limit specified, I’d like the balance back. He said “I’ll see you in court” and hung up.

Now, I know that by the spirit of our agreement, I don’t have much of a leg to stand on. He did have to do some work and he did hold the apartment for us. And since I didn’t care to bother with small claims court over < $200, and I had no idea if I might actually get it, (and I didn’t really feel morally justified in pushing it) I let it go. According to the agreement, we had to be notified in writing that we were approved. We were not. I assume he did in fact have a piece of paper in his office, which is why I didn’t go there before the 3 days were up. Did I have a case?

2

That’s an interesting situation and one that does raise the divide between law and morality. If you asked your mom, she would probably say that you were still obligated because of the spirit of the rules and generic fairness principles (which aren’t codified anywhere).

Do you have a copy of the actual contract?

If it said something like “Landlord will notify Prospective Renter in writing of the results. If Prospective Renter does not respond within X days of being notified of the result, they shall forfeit…”, then you could make an argument that the Landlord breached the contract (and thus might have to pay a small amount of damages), but the second sentence should be broadly interpreted to cover actual notice of approval, however that may have been accomplished (phone, letter taped to brick thrown at you…) , rather than formal notice. Iirc actual vs. formal notice is important in service of process issues - it’s possible to claim that even though you know you are being sued, the lawsuit can’t proceed until you have been formally notified in writing according to the rules of the court.

3

Not anymore.

My memory is that it was quite clear that we would be notified in writing, and if we were not approved in writing, the deposit would be returned.

4

I know as a general rule of thumb (IANAL) that oral contracts on property are not binding. I wonder if that’s in play here either with the “I must notify you in writing.” or if a judge would throw out the entire deal completely (OP gets $180 back).