If the property is significantly damaged or destroyed by a fire or casualty, that damage may give the tenant the right to end the lease early or receive compensation for the unusable portion of the property. If the damage to the property substantially impairs the tenant’s ability to use the property, the tenant may chose to immediately move out and notify the landlord in writing within 14 days after moving out that the tenant is terminating the lease as of the day the tenant moved out. In this case, the landlord must refund all unused rent and the security deposit. If the property is not condemned, the tenant may choose to move out of the damaged portion, in which case the tenant’s liability for rent will be reduced in proportion to the decrease in fair rental value of the property. This section does NOT give tenants the right to withhold any rent. If the tenant is remaining in the property but is vacating a portion of it, the tenant should negotiate with the landlord to agree on the amount of rent which the tenant is owed and whether the landlord will immediately refund it or whether the tenant will deduct that amount from a future month’s rent. The tenant should NOT withhold or deduct any rent until the tenant and landlord have agreed on the amount to be refunded and the method by which it will be refunded. If the tenant caused the damage, the tenant may still exercise these rights. However, the tenant will remain responsible for the damage caused by the tenant.
Click here for a sample notice of termination due to fire or casualty damage.
For a sample notice demanding prorated rent because of fire or casualty damage, click here.