It is said that a friend in need is a friend indeed. However, helping a friend can sometimes result in property damage amounting to thousands of euros, debts, and court summons. Lia Siht, the chief legal officer at Rendin, shares a cautionary tale about why you should not sign a rental agreement in someone else's name.
Published date 24.04.2024
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Renting related issues often arise out of the blue and without proper support and preparation, the consequences can be very costly. Check out how Rendin can make renting safer.

The lease was signed in the name of a friend

At the beginning of last year, Jaan* and his fiancée Maria* (names changed) wanted to rent an apartment. After some searching, they found several appealing listings on the Rendin platform. Both parties had payment defaults, and Jaan had previously been imprisoned, so they asked their friend Rainer* for help with the applications.

Rainer had no payment defaults, so Jaan and Maria asked him to create an account on the Rendin platform and later sign the rental agreement in his name. The couple assured Rainer that they would cover all apartment-related costs and that his name would be removed from the contract as soon as possible, with Jaan becoming the main tenant. In return, Jaan promised to pay Rainer €200 per month, and Rainer agreed.

When applying for rental properties, the friends wrote that the tenant intended to use the apartment with his brother, wife, and dog. In early March, the three of them went to view an apartment. Jaan introduced Rainer to the broker as his brother and confirmed that Rainer would be the responsible tenant, with Jaan and Maria only living there with him. Soon, the contract was signed in Rainer's name, and the couple moved in.

Debts accumulated in the first month

To rent the apartment, the first month's rent had to be paid in advance. However, the second month's rent and utility payments were never received by the landlord. Maret*, the landlord, sent reminders to Rainer about the debts and offered payment options, but to no avail. Although Jaan promised Rainer that he would settle the debts and soon transfer the contract to his name, this never happened.

Only then did Maret learn that Rainer was not living in the apartment and that Jaan and Maria had abandoned the property. Maret immediately informed Rendin about the friends' scheme and began the process of terminating the lease by mutual agreement. This was when the story really started to unfold.

A horrifying sight in the apartment

When the rental home was returned, the apartment owner was shocked. The previously clean and excellent condition apartment was ruined, with dirt and grime everywhere.

The living room sofa was full of holes and stains, with numerous cigarette burn marks on both the sofa and armchairs. There was a large fist-sized hole in the living room table, and the dining table was covered in cuts and scratches because Jaan did not bother using a cutting board. Additionally, one of the beds was completely broken, with its fastenings loose and snapped.

Upon closer inspection, it was clear that the furniture was full of scratch marks from a dog, and one of the couch covers had been chewed up. The living room carpet had been rolled up and placed in the adjacent room, filthy and covered in stains resembling dried animal excrement. It was later revealed that the dog was kept confined in the adjacent room for most of the time.

Rainer showed up alone to return the apartment. He acknowledged what had happened and admitted that there were constant parties in the apartment and that Jaan had destroyed most of the property while drunk. Together, they prepared a lease termination report and documented all the found damages, which Rainer signed.

Damages reached nearly €3,500

With the help of Rendin's legal team, Maret began preparing a compensation claim. She searched for similar replacement items for the damaged furniture in stores and obtained necessary quotes from cleaning companies. During the damage assessment, it was found that the total amount of property damage and outstanding debts was €3,440.

Rendin compensated Maret for the unpaid rent, utility bills, and property damage and issued a claim to Rainer. Rainer allegedly passed the claim to Jaan, hoping he would settle the debts and take responsibility for his actions. However, no response came from Jaan.

When the claim was not settled within a reasonable time, Rendin sent Rainer a reminder for payment. Rainer admitted he had no income and claimed he had been coaxed into signing the lease. He also believed he was not responsible since he did not actually live in the apartment. "We explained to Rainer that, according to the law, the responsible person is the one who enters into contractual relationships, and we offered the option to arrange a payment plan if needed," says Lia Siht, Rendin's chief legal officer.

"According to the law, the person who signs the lease is responsible for fulfilling the rental agreement. Signing a lease is a personal legal responsibility, so it is crucial to read and understand the terms before signing. By signing, the tenant confirms that they have reviewed the terms, understand their content, and agree to enter into the rental agreement under those conditions," explains Lia Siht.

Maret's case: Rendin protection versus deposit



Rental and utility bills compensation



Property damage compensation



Landlord's financial loss



The dispute had to be resolved in court

Since Rainer did not satisfy the debt claims by the predetermined time, the dispute had to be continued in court proceedings. After reviewing the circumstances and holding a court hearing, the court decided to award Rainer compensation for damage to the living space in the amount of 3,682 euros, together with the procedural costs.

"According to the Law of Obligations Act (§ 334 subsection 2), the tenant is liable for the destruction, loss, or damage of the leased property that occurs while it is in the tenant's possession. The tenant is exempt from liability only if they can prove that the destruction, loss, or damage occurred under circumstances not caused by them or by the person to whom they transferred the property under the usage agreement," explains the legal expert.

"The tenant is obligated to use the residential premises carefully and according to the agreed purpose of the lease, and to return it in a condition corresponding to its intended use as per the lease agreement. If the tenant or those living with them (in this case, individuals permitted by the tenant to reside in the apartment) breach the terms of the lease, the landlord has the right to demand compensation or rectification for any damages caused," she adds.

"Legally, Rainer was the responsible party under the lease, and Jaan and Maria were permitted occupants along with the primary tenant. Neither the landlord nor Rendin were aware that Rainer was not personally residing in the residential premises. Additionally, we had no information regarding any other agreements between Rainer and his friends," clarifies Siht.

Rainer unknowingly became a fall guy

"All communication with the landlord during the lease was through Rainer. He signed the lease agreement, the initial handover act, the lease termination agreement, and also confirmed the final handover act, making him responsible for fulfilling the obligations," Siht clarifies.

"If a person enters into a transaction due to fraud or coercion, they have the right to seek protection of their rights through the police. However, if a person acts voluntarily, they are responsible for the problems caused, even if they are unaware of the extent of their liability," she comments.

"In many cases, malicious parties are aware of legal provisions and exploit others' ignorance to absolve themselves of responsibility and shift the burden of debt repayment onto unsuspecting individuals. Unfortunately, this happened to Rainer, who simply wanted to help a friend out of goodwill and had no reason to suspect anything," adds the legal expert.

"The use of fall guys is a significant issue in the rental market, where promises are made to persuade a friend or acquaintance to sign a lease in their name for one reason or another. This allows tenants to act recklessly on the rental property, knowing they won't be held accountable for damages later," observes Siht.

Rendin's chief legal officer strongly advises that under no circumstances should anyone sign a lease agreement in someone else's name. "If a friend or relative cannot rent an apartment themselves due to credit issues or low income, alternatives must be explored rather than becoming legally liable for them. Unfortunately, people often fail to consider potential consequences and don't realize that in the eyes of the law, they themselves are responsible. They hope that if problems arise, their friend will take responsibility, but this usually does not happen, as evidenced by Rainer's case," warns Siht.

*All names in the story have been changed

*The article's cover image is illustrative

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