BROKER RISK MANAGEMENT
WEEKLY PRACTICE TIP
Weekend Open Houses and Showings
Civil Code section 1954 allows a landlord or their agent to show the property to prospective or actual buyers during “normal business hours.” The term “normal business hours” is not defined in the Code, so tenant groups and conservative-minded landlord attorneys have interpreted this to mean Monday through Friday between 9:00 a.m. and 5:00 p.m.
But the August, 2013 California Court of Appeals decision in the case of Dromy v. Lukovsky makes clear that a listing agent of tenant-occupied residential property can hold an open house on weekends during reasonable hours. The court stated that “normal business hours” means “objectively reasonable hours under the facts and circumstances of the case, keeping in mind the right of tenants to quiet enjoyment and the right of landlords to sell their property”
In that case, the tenant refused to allow the landlord’s listing agent to hold open houses on weekends. At trial, the listing agent submitted a statement to the court that the custom and practice of residential real estate agents is to conduct open houses on weekends.
The appellate court, in holding that open houses could be held on weekends, stated that “normal business hours” are those hours when persons in the community keep their places open for business, and that “the relevant community consists of licensed professionals working in the residential real estate sales business” who customarily conduct open houses on weekends. The court ruled that a landlord seeking to show a leased property to prospective buyers may only enter the property during reasonable hours, unless the tenant consents to another time.
PRACTICE TIPS:
1. Based on the Dromy decision, landlords and listing agents who want to arrange open houses on weekends should obtain the tenant’s consent or comply with the reasonableness standard required by the Dromy court.
2. To help meet the “objectively reasonable” standard articulated by the court, landlords and listing agents are strongly encouraged to schedule weekend open houses as closely as possible to the facts in the Dromy case, that is:
- Limit open houses to two per month;
- Stick to usual open house times between 1:00 p.m. and 4:30 p.m.;
- Be present during any open house; and
- Give 10-day advance notice (e-mail, note, etc.) to the tenant of proposed weekend open house dates, and also give the tenant 48-hours to acknowledge and agree, or perhaps offer an alternative weekend date.
3. While this court decision is not carte blanche to demand that a tenant allow open houses on weekends, it does open the door to pointing out to a tenant that you, as the agent for the landlord/seller, have a right to open houses at “objectively reasonable” times on the weekends.
4. You can make the argument that “objectively reasonable hours” are those between 1:00 p.m. to 4:30 p.m. when the real estate brokerage community generally holds open houses.
5. DO NOT PUSH THE POINT YOURSELF IF A TENANT REFUSES AN OPEN HOUSE ON A WEEKEND. If a tenant refuses, discuss with the seller as to whether the seller wishes to push the legal argument with the tenant based on the Dromy case. This, of course, is likely to further antagonize the tenant; but this is a tool that a landlord can consider. The seller should be advised to discuss this issue with their qualified California real estate attorney.
6. Although not discussed by the court in the Dromy decision, it seems that this legal decision is equally applicable to showings to individual prospective purchasers on weekends. Again, be considerate of the tenant’s wishes and situation and be reasonable as to time and frequency of showings.
7. As the proverb says “You can catch more flies with honey than with vinegar.” Acting professionally and polite with the tenant will get you farther than demanding or insisting. One very successful residential income agent always left a small gift for tenants (bottle of wine, candy, etc.) as a reward for when they cooperated. It works.
WEEKLY PRACTICE TIP: DO NOT FORWARD TO CLIENTS. This Weekly Practice Tip is for the exclusive use of clients of Broker Risk Management and their agents. It may not be reproduced or distributed without the express written consent of Broker Risk Management. The advice and recommendations contained herein are not necessarily indicative of standards of care in the industry, but rather are intended to suggest good risk management practices.
© Copyright Broker Risk Management 2013 10/11/13