Mum's the Word: Landlord Liability when Providing a Reference for a Former Tenant


You are sitting at your desk when the phone rings. On the line is the landlord or manager of a community which a former tenant of yours has applied to reside in. He wants to know if this applicant was a good tenant, did he pay his rent on time, did he cause any problems, would you recommend him?

What should you do? Answer: State that it is the park's policy not to give information on former tenants or employees. This is regardless of whether your recommendation would be negative or positive. That is the safest legal approach. If you feel you must say something, make sure your former tenant has given permission for you to talk about his tenancy and only give facts (e.g., dates of residency, whether the tenant paid the rent, etc.).

If you can't say something nice...

It may seem odd that you should not give a positive recommendation to a former tenant, but saying something nice could come back to haunt you. A 1997 California Supreme Court decision concerning job references has potentially far reaching implications for park owners, managers, and employers. In this case, the Supreme Court decided that a former employer may face monetary damages for providing a positive job reference for a person who presents a possible safety risk.

In Randi W. v. Muroc Joint Unified School District, et al., a junior high student was the object of sexual touching and language by a vice principal. The vice principal eventually pled guilty to charges of "unlawful touching of a minor". Former school districts had provided glowing recommendations regarding the educator, although there had been incidents and complaints involving sexual misconduct reported to each of the districts. None of the letters of recommendations mentioned past inappropriate sexual advances by the vice principal against female students. In holding the vice principal's former employers responsible, the Court stated:

". . . We view this case as a `misleading half-truths' situation in which defendants, having undertaken to provide some information regarding [the vice principal's] teaching credentials and character, were obliged to disclose all other facts which `materially qualify' the limited facts disclosed."

In summary, this ruling does not require a past or present employer to notify a prospective employer of a job candidate's short-comings (frequent absences, alcoholism, sexual harassment claims, etc.). However, and most importantly, the decision of the Supreme Court requires that, if an employer does provide a letter of recommendation, the employer cannot state "half truths" regarding the worker; the employer must divulge any information known to the employer regarding any misconduct which could physically endanger others.

One can conclude that, based upon the opinion by the California Supreme Court, the best policy is for an employer to say nothing about job-seeking or former employees. Only on limited occasions should a letter of recommendation be provided to an employee, a job placement service or to a potential employee; on those occasions, it is important to remember the guidelines established in the Randi W. case.

Through extension, the Randi W. case may potentially be used by other landlords and disgruntled tenants to make your life miserable. Here's how:

If a park or apartment house owner calls you and asks about a former tenant of yours . . . watch out! If you say something nice about the tenant, you can get sued later for not telling that potential landlord the bad things about the tenant. Say for example, the tenant got into fights when he lived in your park, but you simply tell an inquiring apartment house landlord "he always paid his rent on time." If that tenant moves into the apartment, then gets into a fight with the apartment manager, you could be liable to that manager for damages.

If you say something bad about a former tenant when a landlord calls for a recommendation . . . watch out! If word of your negative comments get back to your old tenant, he could sue you claiming you "inaccurately" disclosed negative information.

Currently, a majority of large companies will only provide the following information regarding a current or past worker: confirmation of employment, dates of employment, and job title (or job description). Some companies will offer no information; others will only confirm information that a prospective employer already has (such as last salary or job title). Following the recent ruling in the Randi W. case, more employers may choose to say nothing at all.

Screening prospective tenants and employees

Where does all this leave you when you are the one screening prospective tenants or employees? Don't worry, you are not completely without options. Although previous employment history may be difficult to check, and letters or references from former employers may be impossible to obtain, it doesn't hurt to try. In addition, some employers are utilizing security agencies to conduct pre-employment background checks.

Realistically, though, what can the average mobilehome park owner do to efficiently and effectively screen prospective tenants? The answer may lie in checking the applicant's credit report, but there are pitfalls to this approach. Recent changes in the federal Fair Credit Reporting Act require anyone who takes "adverse action" against an applicant based on information obtained from a consumer credit report to inform the applicant in writing of the decision and the reasons for it.

To protect yourself from this law the following steps should be taken. One, be sure to get the applicant's signed permission before obtaining a credit report. Two, send written notification to applicants you reject. The rejection letter should contain: (1) a statement that you have rejected the applicant, and (2) the source of the information on which you based the rejection. The source could be a consumer credit report, in which case you should name the reporting agency and include its address and phone number. Remember to include a sentence to explain that the credit agency did not make the decision and cannot explain why the decision was made to the applicant. Also, tell the applicant of his or her rights, including the right to a copy of the credit report from the credit agency during the next 60 days for free, the right to dispute the accuracy of the report with the credit agency, and the right to have a statement put into the report to explain a debt. As an additional precaution, in case you are ever sued, it would be a good idea to let the applicant know he may have additional rights under state law. By doing all this you can easily prove how thorough and fair you were in providing information to the applicant.

The Bottom Line

  1. Create a park policy not to give out information on former tenants or employees without their permission.

  2. Create thorough written applications for tenants and employees and conduct extensive oral interviews to help you gage what kind of tenant/employee this person would make.

  3. Create a form letter to be sent to all applicants who are rejected because of a poor or insufficient credit report containing all of the aforementioned information.