Phil Querin Q&A: Applicant Buys Home, Qualifies for Residency, Disappears Without Signing Rental Agreement

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July 8, 2019
Phil Querin
MHCO Legal Counsel
Querin Law

Question: We have an applicant who was pre-approved for residency, then purchased a home but did not show up to sign the rental agreement or moving into the home. We learned the
reason for not showing up was that he had been recently arrested for multiple counts of identity theft and is also being investigated for drug activity. 

 

Given this criminal behavior, our concern is that the applicant will become a potential threat to the safety of the community. Do we still have to accept this applicant as a new tenant?  

 

If we do not hear from him for the next week should we start an abandonment?  Is there a limit on how long an approved applicant has to sign a rental agreement?  How should we deal with the presumption of innocence?
 

 

Answer:  My answer requires that I make some assumptions:

  • When you say “pre-approved” I will assume he has not received a final approval;
  • I will assume that somewhere in your application paperwork it states that the landlord-tenant relationship does not commence until the rental or lease agreement is signed.
  • I will assume that management did not say or do anything to cause the applicant to believe he could purchase the home before final approval.
  • Accordingly, I will assume that the person is NOT legally a tenant in your community.

 

ORS 90.303(3)(Evaluation of Applicant)[1]provides that when evaluating the applicant, the landlord may consider criminal conviction and charging history if the conviction or pending charge is for conduct that is

     (a) A drug-related crime; 

     (b) A person crime; 

     (c) A sex offense; 

     (d) A crime involving financial fraud, including identity theft and forgery; or 

(e) Any other crime if the conduct for which the applicant was convicted or     charged is of a nature that would adversely affect: 

  (A) Property of the landlord or a tenant; or 

(B) The health, safety or right to peaceful enjoyment of the premises of residents, the landlord or the landlord’s agent.  (Emphasis added.)

 

So, under the facts of your question (subject to my assumptions), you are within your rights to decline the applicantat the present time.[2]  Since he is not legally a “tenant” under ORS Chapter 90, the landlord tenant law would not apply, so I would notsuggest proceeding under the abandonment statute, ORS 90.675(Disposition of Manufactured Dwelling). 

 

There is no “limit” on how long an approved applicant has to sign the rental agreement in ORS. But there is nothing preventing you from inserting this requirement in your application paperwork.[3]

 

So that he could recoup the cost of the home, I would try to reach out to him and propose, subject to a carefully drafted agreement, that he could sell the home to an approved tenant. Have him enter into a storage agreement with monthly payments, but no occupancy.  

 

While technically you would not be subject to the park-sale statute, ORS 90.680(Sale of Dwelling), you could use it for guidance when screening other applicants for tenancy.

 


[1]This statute was amended in the 2019 Legislative Session by Senate Bill 971, but the changes do not affect my answer.

[2]Although I don’t think it likely, assuming the pending charges were quickly dropped (and ignoring the drug activity investigation), if there was nothing more on the applicant’s criminal record, the issue of whether you must accept him is slightly different. ORS 90.303(2)(Evaluation of Applicant) provides that a landlord may notconsider a previous arrest if it did not result in a conviction.

[3]Note to self:Perhaps MHCO should consider a clause in its applications stating that any approvals given are subject to any material changes to tenant’s qualifications that occur after submitting the application and before taking occupancy.

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