May Need to Break a Yearly Lease

[CatMetal]

My question involves landlord-tenant law in the State of: Wisconsin.

I signed a 1-year lease that began on August 1st, 2020. However, I have been offered an employment opportunity that I would be foolish to pass up. Unfortunately, the commute from my current residence would not be practical in the long-term, and certainly not from now until August 2021. Therefore, I find myself looking to move out of my current rental home. I need some advice regarding the best way to proceed.

I read the lease multiple times, and there is no specific clause for an early move-out. Also, subletting is not permitted, which I would not consider an ideal solution anyway. I am not in a dire financial situation, so I am able to pay rent at two different residences, and I would not fall behind on paying any rent due. I am trying to minimize the personal cost, but more importantly I want to avoid any blemishes on my credit or ending up in court. A bad referral seems possible, although I am hoping to mitigate that by being cooperative, open and paying anything that I owe.

My tentative plan would be to reach out to the property manager directly and try and negotiate a mutually agreeable plan to either pay a lump sum of a couple months rent to be free of the lease, or if that fails to move out and surrender the property at that time, at which point their duty to mitigate damages would start. Then, I would end up paying the rent until they found a new tenant. I am not able to find a prospective tenant myself. There are some things I need to take care of during the job transition, so I am not looking to move out ASAP, rather, it would be either the end of November or at some point in December.

To be more specific:
1.) What steps should I take to move out early?
2.) What will be the consequences of the steps in #1?
3.) Do the Wisconsin so-called "No-Go Clauses" complicate things? (the way I understand them, leases can't end or evictions can't occur in winter months)
4.) The upstairs tenant wants to move downstairs when I move out. If the landlord actually approved that, would I then be on the hook for rent until the upstairs is rented? Or would I be off the hook because my unit has a new tenant?

Thanks!

[Taxing Matters]

1.) What steps should I take to move out early?

You've outlined your options pretty well, I think:

My tentative plan would be to reach out to the property manager directly and try and negotiate a mutually agreeable plan to either pay a lump sum of a couple months rent to be free of the lease, or if that fails to move out and surrender the property at that time, at which point their duty to mitigate damages would start.

That's pretty much the two basic options any tenant has when needing to get out early when the lease itself doesn't provide some option for getting out early.

2.) What will be the consequences of the steps in #1?

If you succeed in negotiating an early end to your lease, then once you complete your end of that bargain you are off the hook. If you don't succeed in that and just move out and relinquish possession back to the landlord then the landlord may sue you later for the rent he lost while finding a new tenant. The landlord has to make a good faith effort to find that new tenant; he cannot just let it sit empty and count on you being on the hook for the rest of the lease term. Problem is that in these weird times with covid upending things for a lot people there's no telling how fast he might relet the place. In some places the rental market is still pretty active, in others it's really slow. No idea what your area is like.

3.) Do the Wisconsin so-called "No-Go Clauses" complicate things? (the way I understand them, leases can't end or evictions can't occur in winter months)

Does your lease contract have a clause that says the lease cannot be terminated during the winter and/or says the landlord has no duty to mitigate damages if a lease ends during those months, or has some other clause that somehow restricts your ability to terminate during the winter? If it does, then that is when Wisconsin's "no go clause" rule may come into effect. If it does, provide the wording of that provision here and you may get feedback on how you might use that to your advantage. Make sure to replace any identifying info in provision you quote with generic names if you do that.

4.) The upstairs tenant wants to move downstairs when I move out. If the landlord actually approved that, would I then be on the hook for rent until the upstairs is rented? Or would I be off the hook because my unit has a new tenant?

That would let you off the hook because your place is now leased. The fact that tenant who moved in came from another of the landlord's units doesn't become your problem. The landlord should be fully aware if he agrees to that other tenant's request that he can't come after you for rent that would have been due from you after the tenant moves in. If the landlord doesn't know that, well, that's his problem. If I were you I'd not enlighten the landlord about that until AFTER the other tenant has moved into your place.

[pg1067]

1.) What steps should I take to move out early?

You answered your own question: "My tentative plan would be to reach out to the property manager directly and try and negotiate a mutually agreeable plan to either pay a lump sum of a couple months rent to be free of the lease."

What will be the consequences of the steps in #1?

You answered this one as well. See above.

Do the Wisconsin so-called "No-Go Clauses" complicate things? (the way I understand them, leases can't end or evictions can't occur in winter months)

This isn't a state-specific board, and I don't know anything about this. As you've described it, though, it wouldn't be relevant. However, if you've described it accurately,*** then you can probably expect your landlord to want six months of rent to let you out of the lease early.

The upstairs tenant wants to move downstairs when I move out. If the landlord actually approved that, would I then be on the hook for rent until the upstairs is rented? Or would I be off the hook because my unit has a new tenant?

You should be off the hook, but a lot depends on the other tenant's lease situation. I also doubt that the landlord will approve an arrangement that is to his/her/its financial detriment.


*** - EDIT: I googled this, and it doesn't appear that you've described it accurately. The Wisconsin Landlord and Tenant law is found in Chapter 704 of the Wisconsin Statutes. This article describes a "winter no-go clause" as a provision in the lease that limits a tenant's right to move out during months between October and March (i.e., it's not a law). The article then refers to section 704.44(3m) of the Wisconsin statutes, which provides that "a residential rental agreement is void and unenforceable if it . . . waives the landlord's obligation to mitigate damages." I assume that the existence of such a clause does not actually void the entire lease. Rather, I assume that only the non-mitigation provision is void and unenforceable (but I have not looked at any case law on the subject). The gist of this is that, if you break your lease, your landlord will have a duty to mitigate by finding a new tenant, and that duty exists regardless of the time of year and whether or not your lease says otherwise. However, I assume it goes without saying that finding a new tenant to move in when it's BF cold outside will be extremely difficult, so, even though the landlord has a duty to mitigate, he/she/it might not be able to find a new tenant.

[adjusterjack]

if that fails to move out and surrender the property at that time, at which point their duty to mitigate damages would start. Then, I would end up paying the rent until they found a new tenant.

There's danger the way you wrote that. The landlord's duty to mitigate begins when you have breached the contract. If you continue to pay rent after move out you have not breached the contract and the landlord has no duty to mitigate. He can keep on collecting your rent as long as you are willing to pay it and not have to lift a finger to re-rent.

If you want to rely on Wisconsin's mitigation statute, you leave, surrender the premises and the keys, give written notice that you terminated and then withhold rent until the landlord re-rents and can send you a bill or itemized deposit refund if he re-rents quickly.

Here's the Wisconsin mitigation statute:

https://law.justia.com/codes/wiscons...ection-704-29/

As for any "no go" provision, well, a breach is a breach if you ignore it. The landlord would still have to mitigate though I imagine that winter delays would give him a defense if it took a couple of months.

If you leave without paying any further, you're in a better negotiation position to offer to pay as soon as re-rented.

I'm not condoning the above, just explaining your options.

[llworking]

There's danger the way you wrote that. The landlord's duty to mitigate begins when you have breached the contract. If you continue to pay rent after move out you have not breached the contract and the landlord has no duty to mitigate. He can keep on collecting your rent as long as you are willing to pay it and not have to lift a finger to re-rent.

If you want to rely on Wisconsin's mitigation statute, you leave, surrender the premises and the keys, give written notice that you terminated and then withhold rent until the landlord re-rents and can send you a bill or itemized deposit refund if he re-rents quickly.

Here's the Wisconsin mitigation statute:

https://law.justia.com/codes/wiscons...ection-704-29/

As for any "no go" provision, well, a breach is a breach if you ignore it. The landlord would still have to mitigate though I imagine that winter delays would give him a defense if it took a couple of months.

If you leave without paying any further, you're in a better negotiation position to offer to pay as soon as re-rented.

I'm not condoning the above, just explaining your options.

If not many units become available during the winter months because leases are not ending, then the landlord might have an easier time finding a new tenant. For those people who DO need housing there likely wouldn't be a whole lot of choices.

[latigo]

I disagree. There is no beginning to your supposed landlord's duty to mitigate simply because a Wisconsin landlord is under no such obligation. Not under any circumstances does such an obligation arise. It's strictly optional with the landlord and a matter of set off. Meaning that there shall be deducted from any claims against the tenant for rent and/or damages the net rent reasonably obtainable from efforts to rerent the preemies. (Wisconsin Statutes Section 704.29)

The burden of proving what was obtained, what could have reasonably been obtained, and when obtainable all resting with the tenant.

[Taxing Matters]

I disagree. There is no beginning to your supposed landlord's duty to mitigate simply because a Wisconsin landlord is under no such obligation.

Actually you have that wrong. There is indeed a duty to mitigate damages in Wisconsin, and the statute that you cited does not change that. It merely clarifies what goes into computing what the landlord may win in action against a tenant that has abandoned the property before the lease ends. The Wisconsin Supreme Court, in a case that arose after the enactment of § 704.29 and that later goes on to discuss the application of that section on the issue of when the landlord has accepted surrender of the premises, clearly sets out the duty of mitigation:

Upon the tenant's surrender of the leased premises, the landlord has a duty to exercise reasonable diligence to re-rent the premises in order to mitigate damages. Sprecher v. Weston's Bar, Inc., 78 Wis.2d 26, 42, 253 N.W.2d 493 (1977); Patton v. Milwaukee Commercial Bank, 222 Wis. 167, 171, 268 N.W. 124 (1936); Strauss v. Turck, 197 Wis. 586, 587, 222 N.W. 811 (1929); sec. 704.29, Stats.

First Wisconsin Tr. Co. v. L. Wiemann Co., 93 Wis. 2d 258, 271, 286 N.W.2d 360, 366 (1980). So, there you have it, straight from the state's highest court: a landlord does have the duty to mitigate damages. The West Editors to the Wisconsin Statutes Annotated, explained the state of the law before enactment of § 704.29 and the reason for the Legislature adopting it as follows:

The Wisconsin Supreme Court is one of the growing number of modern courts which have announced that the landlord has an obligation to rerent when the tenant breaches the lease; this is merely an application of the fundamental damage rule that a party must use reasonable efforts to minimize his loss, whether in contract or in tort. Selts Investment Co. v. Promoters, etc., 197 Wis. 476, 222 N.W. 812 (1929); Strauss v. Turck, 197 Wis. 586, 222 N.W. 811 (1929); Patton v. Milwaukee Commercial Bank, 222 Wis. 167, 268 N.W. 124 (1936). Nevertheless the scope of the doctrine remains vague, and the case law dealing with acts which the landlord may take in mitigating damages is confused by tension with the old doctrine of surrender. It is therefore important to clarify both aspects of the law by statutory enactment, rather than leaving further development to slow and costly litigation. It is important that both parties to a lease know what the legal consequences of breach may be.

Wis. Stat. Ann. § 704.29 (West)(Editor's notes). As you can see, the duty to mitigate is an old one in Wisconsin, going back at least 90 years. The purpose of the statute was not to end that duty but to clarify some of the unresolved issues left out in the case law, like how the doctrine of surrender worked and what acts will constitute mitigation.

And a review of web sites by Wisconsin attorneys who practice landlord tenant law also state there is a duty to mitigate damages. For example, this comment from a Wisconsin attorney whose practice focuses on representing landlords on landlord-tenant matters states:

Put quite simply - a landlord cannot just sit back and do nothing and expect to collect rent from the departed tenant until the lease term ends. Per Sec. 704.29 of the Wisconsin Statutes, a landlord must make reasonable efforts to attempt to mitigate the tenant's damages by trying to re-rent the unit for the tenant.

From everything I see, therefore, it's very clear that there is indeed a duty on the landlord to mitigate damages. Starting with that very pointed statement from the Wisconsin Supreme Court.