Death of a Residential Tenant in Texas

Introduction

This article assumes that the subject for discussion is a deceased-tenant scenario in the context of a TXR residential lease. Though not a required form, the Texas Realtors Residential Lease (form TXR-2001 dated 7-08-22) is commonly used for the rental of single-family dwellings in Texas. What happens under this lease when a tenant dies? How should the landlord handle the deceased tenant’s personal property? The TXR lease addresses these issues in paragraph 34G:

34G. If a tenant who is the sole occupant of the Property dies before the expiration of the tenant’s lease, a representative of the estate or the person named in Paragraph 34(F) may terminate the tenant’s rights and obligations under the lease if the representative or the person named in Paragraph 34(F) provides to the Landlord written notice of the termination of the lease as required by Section 92.0162, Property Code and the deceased tenant’s property is removed from the leased premises in accordance with Section 92.014 of the Property Code and the representative or the person named in Paragraph 34(F) signs an inventory of the removed property if required by the landlord. Termination of a lease is effective on the later of: (1) the 30th day after the date on which the notice under Section 92.0162, Property Code was provided; or (2) the date on which all of the conditions in under Section 92.0162, Property Code have been met.

The lease falls short of a comprehensive set of instructions on what the landlord should do when a tenant dies. Determining what is legally expected of the landlord in any specific situation will require reading the lease and referring to at least two sections of the Property Code.

Core Applicable Law Part One: Prop. Code Sec. 92.0162

The TXR lease expressly incorporates the provisions and requirements of Property Code Section 92.0162. This section grants a representative of the tenant’s estate certain rights but only if written notice of termination is given, personal property is removed, and an inventory is signed:

Prop. Code Sec. 92.0162. Right to Vacate and Avoid Liability Following Tenant’s Death

(a) A representative of the estate of a tenant who dies before the expiration of the tenant’s lease and was, at the time of the tenant’s death, the sole occupant of a rental dwelling may terminate the tenant’s rights and obligations under the lease and may vacate the leased premises and avoid liability for future rent and any other sums due under the lease for terminating the lease and vacating the leased premises before the end of the lease term if:

(1) the representative provides to the landlord or the landlord’s agent written notice of the termination of the lease under this section;

(2) the deceased tenant’s property is removed from the leased premises in accordance with Section 92.014(c) or (d); and

(3) the representative signs an inventory of the removed property, if required by the landlord or the landlord’s agent.

(b) Termination of a lease under this section is effective on the later of: (1) the 30th day after the date on which the notice under Subsection (a) was provided; or (2) the date on which all of the conditions in Subsection (a) have been met.

(c) After receipt of the notice provided under Subsection (a), the landlord shall provide a copy of the written lease agreement to the person who provided the notice on written request of that person.

(d) This section does not affect the obligations or liability of the tenant or the tenant’s estate under the lease before the lease is terminated under this section, including the liability of the tenant or the tenant’s estate for: (1) delinquent, unpaid rent; and (2) damages to the leased premises not caused by normal wear and tear.

(e) A landlord or landlord’s agent who lawfully permits a person described by Subsection (a) to enter or facilitates the person’s entry into the leased premises under this section is not liable for an act or omission that arises in connection with permitting or facilitating the entry.

Following the steps in Section 92.0162 achieves three things for the tenant’s heirs and representative. The tenant’s representative obtains:

(1) access to the premises;

(2) the ability to remove personal possessions (probably subject to the landlord’s lien on non-exempt personal property—see below); and

(3) lease and liability termination or, as the statute says, “avoidance of liability for future rent and any other sums due under the lease.”

It is worth noting several important points:

(1) landlord obligations are only triggered only if:

(a) a tenant representative in fact exists (designated either in paragraph 34F or by the tenant pursuant to Section 92.014(b)) and is willing to act;

(b) the deceased tenant was the sole occupant; and

(c) the named representative gives written notice of termination, removes the deceased tenant’s personal property, and signs an inventory. Unless these events occur, a landlord has few legal obligations to the tenant’s heirs, if any, at least in the absence of the appointment of a personal representative of the deceased tenant’s estate by a probate court.

(2) The balance owed under the lease is not automatically extinguished when a tenant dies. Unless a representative of the deceased tenant gives notice of termination, removes the tenant’s property, and signs an inventory (i.e., follows Section 92.0162 to the letter) the tenant’s estate will be liable for unpaid rent and damages in excess of normal wear and tear.

(3) The parties need not be at the mercy of this process. A custom lease addendum, entered into when the lease is signed, can vary and supersede the death process to their mutual advantage.

Core Applicable Law Part Two: Prop. Code Sec. 92.014

Lease termination and property removal is not the end of the story. In order to fully understand the process one must also refer to Property Code Section 92.014:

Prop. Code Sec. 92.014. Personal Property and Security Deposit of Deceased Tenant

(a) Upon written request of a landlord, the landlord’s tenant shall: (1) provide the landlord with the name, address, and telephone number of a person to contact in the event of the tenant’s death; and (2) sign a statement authorizing the landlord in the event of the tenant’s death to:

(A) grant to the person designated under Subdivision (1) access to the premises at a reasonable time and in the presence of the landlord or the landlord’s agent;

(B) allow the person designated under Subdivision (1) to remove any of the tenant’s property found at the leased premises; and

(C) refund the tenant’s security deposit, less lawful deductions, to the person designated under Subdivision (1).

(b) A tenant may, without request from the landlord, provide the landlord with the information in Subsection (a).

(c) Except as provided in Subsection (d), in the event of the death of a tenant who is the sole occupant of a rental dwelling: (1) the landlord may remove and store all property found in the tenant’s leased premises; (2) the landlord shall turn over possession of the property to the person who was designated by the tenant under Subsection (a) or (b) or to any other person lawfully entitled to the property if the request is made prior to the property being discarded under Subdivision (5); (3) the landlord shall refund the tenant’s security deposit, less lawful deductions, including the cost of removing and storing the property, to the person designated under Subsection (a) or (b) or to any other person lawfully entitled to the refund; (4) the landlord may require any person who removes the property from the tenant’s leased premises to sign an inventory of the property being removed; and (5) the landlord may discard the property removed by the landlord from the tenant’s leased premises if: (A) the landlord has mailed a written request by certified mail, return receipt requested, to the person designated under Subsection (a) or (b), requesting that the property be removed; (B) the person failed to remove the property by the 30th day after the postmark date of the notice; and (C) the landlord, prior to the date of discarding the property, has not been contacted by anyone claiming the property.

(d) In a written lease or other agreement, a landlord and a tenant may agree to a procedure different than the procedure in this section for removing, storing, or disposing of property in the leased premises of a deceased tenant.

(e) If a tenant, after being furnished with a copy of this subchapter, knowingly violates Subsection (a), the landlord shall have no responsibility after the tenant’s death for removal, storage, disappearance, damage, or disposition of property in the tenant’s leased premises.

(f) If a landlord, after being furnished with a copy of this subchapter, knowingly violates Subsection (c), the landlord shall be liable to the estate of the deceased tenant for actual damages.

This section uses mandatory language: the landlord may remove and store personal property of a deceased tenant but nonetheless shall turn it over to a tenant-designated representative if a request is made prior to the property being discarded. Also, the landlord shall refund the tenant’s security deposit, less lawful deductions (including the cost of removing and storing the property) to the designated representative.

Subsection (d) adds a key caveat: in “a written lease or other agreement, a landlord and a tenant may agree to a procedure different than the procedure in this section for removing, storing, or disposing of property in the leased premises of a deceased tenant.”

In other words, Section 92.014 is mandatory unless the lease says otherwise—which the TXR lease in fact does. Paragraph 34F provides that a landlord may permit access, may permit the removal of personal property, and may refund the security deposit to the tenant’s representative. The word shall is nowhere to be found in paragraph 34F. By using the word may, the word shall in the statute is quietly negated. What was obligatory under the statute becomes optional under the TXR lease. A tenant right has been converted to landlord discretion.

Under the TXR lease, could a landlord deny access and refuse to release a deceased tenant’s personal property unless the tenant’s heirs pay off the lease in full? Yes, according to a strict reading of the lease; and the Property Code offers no assistance to the tenant’s heirs in such a situation.

Is death a tenant default under the TXR lease?

The answer, apparently, is yes in the following respects:

(1) unless the lease was paid in advance, there likely is (or shortly will be) a rental payment default in violation of paragraph 27.B which states: “If Tenant fails to timely pay all amounts due under this lease or otherwise fails to comply with this lease, Tenant will be in default. . . .”

(2) the deceased tenant has effectively vacated (surrendered) the property in violation of paragraph 27.D;

(3) there is effectively a failure to surrender the property in the same condition as when it was received by the tenant, normal wear and tear excepted, as required by paragraph 16.A; and

(4) the deceased tenant has effectively abandoned the property in violation of paragraph 16.

As to the landlord’s remedies for abandonment specifically:

(1) Property Code Section 54.044(d) provides: “If the tenant has abandoned the premises, the landlord or the landlord’s agent may remove its contents.”

(2) Paragraph 16C(1) of the TXR lease states: “If Tenant leaves any personal property in the Property after surrendering or abandoning the Property [e.g., as a consequence of dying] Landlord may: (a) dispose of such personal property in the trash or a landfill; (b) give such personal property to a charitable organization; or (c) store and sell such personal property by following procedures in §54.045(b)-(e), Property Code.”

What about the landlord’s lien?

The TXR lease provides for a landlord’s lien in paragraph 23:

23. RESIDENTIAL LANDLORD’S LIEN: Landlord will have a lien for unpaid rent against all of Tenant’s nonexempt personal property that is in the Property and may seize such nonexempt property if Tenant fails to pay rent. Subchapter C, Chapter 54, Property Code governs the rights and obligations of the parties regarding Landlord’s lien. Landlord may collect a charge for packing, removing, or storing property seized in addition to any other amounts Landlord is entitled to receive. Landlord may sell or dispose of any seized property in accordance with the provisions of §54.045, Property Code.

In the event of tenant default, paragraph 27B(3) states that “Landlord may exercise Landlord’s lien under Paragraph 23 and any other rights under this lease or the Property Code. . . .”

Is the landlord’s lien extinguished by the tenant’s death? No. The TXR lease makes no such statement, nor does it make an exception for death as a cause of the tenant’s default. The Property Code is similarly silent on whether or not death is a tenant default. Accordingly, the ability of a deceased tenant’s representative to remove a deceased Tenant’s personal property likely remains subject to the landlord’s lien retained in the paragraph 23 of the lease.

Refusal to Release Non-Exempt Property

Property Code Section 54.044(a) states: “The landlord or the landlord’s agent may not seize [refuse to release] exempt property and may seize nonexempt property only if it is authorized by a written lease and can be accomplished without a breach of the peace [italics added].”

We should therefore look at the TXR lease, specifically paragraph 34F:

34F. If all occupants over 18 years of age die during this lease, Landlord may [italics added] (i) permit the person named below to access the Property at reasonable times in Landlord’s or Landlord’s agent’s presence; (ii) permit the named person to remove Tenant’s personal property; and (iii) refund the security deposit, less deductions, to the named person.

Paragraph 34F uses discretionary (not mandatory) language. A landlord may refuse just as he may permit. So: can a landlord lawfully refuse to release non-exempt property (a television, for example) to the tenant’s representative? Yes, so long as it does not involve a breach of the peace.

Sale of Deceased Tenant’s Property

Paragraph 23 of the lease states that a landlord may sell or dispose of any seized tenant property in accordance with the provisions of Property Code Section 54.045:

Prop. Code Sec. 54.045. Sale of [Tenant’s Personal] Property

(a) Property seized under Section 54.044 may not be sold or otherwise disposed of unless the sale or disposition is authorized in a written lease.

(b) Before selling seized property, the landlord or the landlord’s agent must give notice to the tenant not later than the 30th day before the date of the sale. The notice must be sent to the tenant by both first class mail and certified mail, return receipt requested, at the tenant’s last known address. The notice must contain: (1) the date, time, and place of the sale; (2) an itemized account of the amount owed by the tenant to the landlord; and (3) the name, address, and telephone number of the person the tenant may contact regarding the sale, the amount owed, and the right of the tenant to redeem the property under Subsection (e) of this section.

(c) A sale under this section is subject to a recorded chattel mortgage or financing statement. The property shall be sold to the highest cash bidder. Proceeds from the sale shall be applied first to delinquent rents and, if authorized by the written lease, reasonable packing, moving, storage, and sale costs.

(d) Any sale proceeds remaining after payment of the amounts authorized in Subsection (c) of this section shall be mailed to the tenant at the tenant’s last known address not later than the 30th day after the date of the sale. The landlord shall provide the tenant with an accounting of all proceeds of the sale not later than the 30th day after the date on which the tenant makes a written request for the accounting.

(e) The tenant may redeem the property at any time before the property is sold by paying to the landlord or the landlord’s agent all delinquent rents and, if authorized in the written lease, all reasonable packing, moving, storage, and sale costs.

Tenant Concerns

As with other provisions of the TXR lease, deceased-tenant provisions are highly oriented in favor of the landlord. Particularly problematic from the tenant’s point of view is the substitution of may for the obligatory shall found in Property Code Section 92.014(c). The potential exists for a landlord to hold both the premises and personal property of a deceased tenant hostage until full payment is exacted. Whether one views this as a just result depends on whose interests one represents.

A tenant signing a TXR lease who is concerned with mortality and estate liability issues can achieve significant benefit by adding a custom addendum that does away with tricky wordplay and makes both the death-of-tenant process as well as the rights of the surviving parties more straightforward.

Conclusion

In the absence of a clarifying lease addendum, there exists an unnecessarily wide opening for disputes and litigation when a residential tenant dies with a TXR lease. Challenges can arise because of the overt bias of the lease as well as from inscrutable and overlapping statutory provisions. Confusion can easily occur when the deceased tenant was not the sole occupant or there is no designated representative of the deceased tenant.

It is important to note that nothing stands in the way of the parties entering into a cooperative and amicable agreement to settle the matter on their own terms. Given the potential for litigation, counsel for each side should encourage such a settlement, perhaps accompanied by execution of a mutual release.