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New law allows landlords to charge liquidated damages

TALLAHASSEE, Fla. – June 16, 2008 – A Florida landlord can now charge liquidated damages or an early termination fee under a bill signed last week by Gov. Charlie Crist, even if the property is re-rented immediately. The bill is similar to one Crist vetoed last year.

Under HB 1489 by Pat Patterson (R-DeLand), liquidated damages or an early termination fee do not include other damages, unpaid rent or accrued charges. However, the new law also provides limits and rules that must be followed before a tenant may be charged. Under the bill, for example, the early termination fee cannot exceed two months rent, and the landlord cannot require the tenant to give more than 60 days notice. As before, lost rental proceeds cannot be collected if the unit is immediately re-rented, and those amounts must be deducted from the balance due from the previous tenant.

However, the primary requirement is prior tenant agreement to pay the fees as part of the contract. To collect an early termination fee, a landlord must present the tenant with a separate addendum that offers two choices, with the wording outlined in HB 1489. The tenant either agrees to pay the fee should he choose to move before the end of the lease period, or acknowledges that the landlord could still seek damages as provided by law.

The law became effective when the governor signed it.

To read the entire bill, click here.

Questions? Call FAR’s Legal Hotline, a free call for members except for any long distance phone charges, at: (407) 438-1400.

© 2008 FLORIDA ASSOCIATION OF REALTORS®

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