Q: What legal remedies does a landlord have when a tenant terminates their lease early?

A: A lease is a legally enforceable contract between the landlord and tenant and a breach of a lease contract will have ramifications on the breaching party. A landlord cannot force a tenant to remain in the leased property, but a tenant who terminates a lease early may remain responsible for rental payments until a replacement tenant is secured by the landlord. The lease agreement should also be reviewed by the landlord with legal counsel to determine what the landlord may legally collect from the tenant. If using the MAR Standard Residential Lease, a tenant who abandons the lease is obligated to pay the balance of the rent due under the remainder of the lease or until the commencement of a new tenancy, whichever is shorter. The tenant is also responsible for covering the costs of restoring the premises to the same condition as they were at the commencement of their tenancy, plus the costs of advertising for a new tenant, including broker’s fees. Case law establishes that the landlord must undertake reasonable efforts to locate a new tenant to mitigate the potential damages incurred by the breach 

Q: Does a listing agent need to disclose the existence of competing offers to a cooperating broker?

A: Maybe. A seller may instruct their listing broker on whether the existence of an offer should be disclosed. MAR’s Exclusive Right to Sell Listing Agreement provides that the Seller grants authority to the listing broker to disclose to prospective buyers or their agents whether an offer has been submitted on the property and whether the offer is from a buyer introduced to the property by the listing agent, by another licensee within the brokerage, or by a cooperating broker. This is consistent with Article 1, Standard of Practice 1-15, in the REALTOR® Code of Ethics. The provision contained within MAR’s listing agreement additionally provides that, while the existence of a competing offer may be disclosed, the terms themselves remain confidential unless otherwise provided by the seller.

Listing brokers who are using an Exclusive Right to Sell Listing Agreement other than MAR’s should review the terms of the agreement used prior to sharing any information with a cooperating broker about the existence of competing offers. Without an instruction from the seller specifically authorizing disclosure, REALTORS® should not share any information regarding competing offers with a prospective buyer or their agent.

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Written by: Justin Davidson, General Counsel; Catherine Taylor, Associate Counsel; Jonathan Schreiber, Legislative & Regulatory Counsel; and Kate Berard, Associate Counsel.

Services provided through the Massachusetts Association of REALTORS® is intended for informational purposes and does not constitute legal advice, nor does it establish an attorney-client relationship. The Massachusetts Association of REALTORS®, by providing this service, assumes no actual or implied responsibility for any improper use of responses to questions through this service.  The Massachusetts Association of REALTORS® will not be legally responsible for any potential misrepresentations or errors made by providing this service. For more information regarding these topics authorized callers should contact the MAR legal hotline at 800-370-5342 or e-mail at legalhotline@marealtor.com.