When Fiduciary Duty, Honesty & Fair Dealing Collide- Always Err on The Side of Doing What is Right~

By
Property Manager with Investors Choice Property Management CAL BRE LIC# 01124954

As a small Sacramento-based property manager for the past 16+ years, we have had the privilege to work with some of the very best Landlords in the area, from 1st time investors to seasoned real-estate professionals, people are coming (and staying) with our services due to a simple but stringent governing principle- We say what we do, then we actually do what we say. Our business is mostly word-of-mouth and the feedback has been overwhelmingly good. Our clients enjoy personalized services customized to their individual needs, grounded in the knowledge that they have first-hand access to a licensed Broker, without having to deal with various departments and other roadblocks.

As agents for our Landlord clients, we have a fiduciary responsibility to act in their best interests. We also have an obligation to everyone else we deal with to be honest and fair. Recently, these concepts collided with the move-out of a tenant from one of our rentals.

Our ex-tenants, Mr. & Mrs. "Jones" (No one knows why the Smiths and Jones' get all the bad press), moved from a condo we manage in Roseville after a 12 month lease. As always, we documented their move in and move out with digital photos to protect our Landlord client's interests. As part of the move-out process, the Jones' requested and were granted a pre-move out inspection, wherein we inspected the property and noted any deficiencies needing correction in order to maximize the security deposit refund, up to 100%.

Overall, the walk-through went well, though we did note that the carpet needed cleaning, 2 smoke alarm batteries were missing and the furnace filter needed changing. otherwise, the tenants did an admirable job of keeping up the rental over their lease. The tenant had a history of being argumentative, and was loudly critical of our findings during the inspection, but that is just an unfortunate part of the job our clients pay us to do. 

The owner inspected the property after vacancy, and emailed us to breakdown the charges they would be assessing the ex-tenants- charges which did not align with our inspection results. Among the erroneous charges were fees to remove stains in the carpet, replace a broken mini-blind, and dismantle a large plywood cabinet in the garage. It was fortunate for the ex-tenant that we maintained accurate digital photos showing all of the pre-existing conditions at the rental, including the ones above that our client was planning on charging the ex-tenant for.

I had to bring this up because it is one of those "behind the scenes" incidents that the ex-tenant will never know about nor appreciate, how we defended his deposit and had to stand up to our own client, erring on the side of what was honest and fair, rather than go along with what could be "gotten away with". At the end of the day, we'll likely lose a client over our principles, but it is a small price to pay to keep one's integrity intact.

 

Investors Choice Property Management (ICPM) manages 105 single-family units with the care and diligence our Landlord clients deserve, in a manner that has them referring their friends, co-workers and family members. With over 16 years professional property management experience, our business is 95% word-of-mouth referral, we do NO Sales, we do NOT markup repairs, and pay among the highest referral fees in the industry for management accounts. Visit our website at www.investorschoicepm.com today for more details, and find out what we mean when we say: “Experience Property Management the Way it Should Be.”

Comments (4)

Pam Simpson
Bob Leigh & Assoc., LLC - Senatobia, MS
GRI, Broker-Assoc.

Good for you.  It may not always be the easiest thing to do, but it is always the right thing to do.

Aug 20, 2009 06:39 AM
Diane Rice
Rice Prprty Mgmnt & Rlty, LLC, South Holland, IL - Lansing, IL
SFR, SRES, CNC

It would be great if you joined our Property Management Group and posted your most informative posts there also - we have a good audience!

Diane

Sep 02, 2009 05:28 PM
Robert Machado
Homepointe - Sacramento, CA

Good post Thomas, as the buffer between two principals we often get caught in the middle.  It is always the right decision to follow the law.  Consistency is everything.

James Safonov

Dec 16, 2009 03:47 AM
Tony and Suzanne Marriott, Associate Brokers
Serving the Greater Phoenix and Scottsdale Metropolitan Area - Scottsdale, AZ
Haven Express @ Keller Williams Arizona Realty

Far too many agents and Buyers are ignorant of or conveniently forgetful about the Covenant of Good Faith and Fair Dealing that applies to ALL contracts.

Aug 12, 2010 02:26 AM