August 10, 2018
Author: William Brady
Organization: Brady Law Firm
A. Tenant Credit and Background Check
Before entering into a lease agreement, it is essential to obtain information about the credit history of the prospective tenant(s) in order to evaluate and minimize the landlord’s potential risk. With most applicants, that can usually be ascertained by reviewing their credit report, as that will generally provide a good snapshot of their credit worthiness. However, there can be instances where an applicant will have very little or no information on their credit report, such as college students or young adults who haven’t developed a credit history. In those instances, it is advisable to require a co-signer or guarantor, such as a parent, in order to further protect the landlord’s interests.
Prior to pulling a credit report, it is recommended that the applicant’s written consent be obtained. Many lease application forms contain a provision authorizing the landlord to obtain a copy of the applicant’s credit report for use in evaluating their application. If not, a simple written statement to that effect, signed by the applicant(s), will suffice. It is also recommended that the landlord retain copies of the application and credit report for all applicants, especially those who are denied housing, in a secure place for at least two years, in the event that complaints or actions are lodged under the Delaware Fair Housing Act or the Landlord Tenant Code.1 incorporates these prohibitions into the Landlord//Tenant Code. When a credit report is not sufficient to determine the prospective tenant’s credit worthiness, the landlord should take additional steps to evaluate the application. While contacting the tenant’s current landlord may help, keep in mind that that landlord may be looking to rid themselves of a problem tenant and a “recommendation” may not be particularly sincere. Conversely, information may not necessarily be accurate if the current landlord and tenant presently have a dispute, which is the basis for the tenant seeking replacement housing. Also, information from former landlords may be limited by the terms of settlement agreements, as there can be instances where a landlord and tenant resolve a housing matter where the tenant will move out and the landlord agrees to provide a neutral reference, in theory, to not make it more difficult for the tenant to find a new rental unit. Lastly, there are also online resources to investigate a prospective tenant.
It is also important to keep in mind that the landlord does not have to absorb the cost of the credit report or background check. 25 Del. C. § 5514(d), as well as 25 Del. C. § 7008(d) relating to Mobile Homes, both provide:
“Where a tenant is required to pay a fee to determine the tenant's
credit worthiness, such fee is an application fee. A landlord may
charge an application fee, not to exceed the greater of either 10
percent of the monthly rent for the rental unit or $50, to
determine a tenant's credit worthiness. The landlord shall, upon
receipt of any money paid as an application fee, furnish a receipt
to the tenant for the full amount paid by the tenant, and shall
maintain for a period of at least 2 years, complete records of all
application fees charged and amounts received for each such fee.
Where the landlord unlawfully demands more than the allowable
application fee, the tenant shall be entitled to damages equal to
double the amount charged as an application fee by the landlord”.
Therefore, by charging an application fee, the landlord can offset the costs involved. However, compare § 5514 with 25 Del. C. § 5310, which prohibits “assurance money” and specifically provides that a landlord “shall not charge any prospective tenant, as a fee for any credit or other investigation, any more than the specific cost of such investigation”. In addition, the landlord is required to retain for 6 months records of each application by any prospective tenant. The Consumer Protection Unit of the Attorney General’s office is empowered to investigate all complaints related to assurance money and, if appropriate, issue cease and desist orders
Before a landlord can lawfully rent a unit to a tenant, it may be necessary to have a pre-rental inspection performed. A number of municipalities require that a rental property be inspected and approved prior to a tenant being installed. For example, the City of Newark and Town of Middletown require a pre-rental inspections.
In addition, Newark and Dover require yearly inspections. A table providing information on various municipalities in each of New Castle, Kent and Sussex Counties in included in the Appendix.
While there may be reluctance on the part of some landlords to have a pre-rental inspection performed, it is actually an effective way of limiting the landlord’s potential liability to a tenant, should they complain about conditions. For example, it serves to document that the unit was in code compliance at the time the new tenant took possession. In addition, 25 Del. C. § 5305 regarding landlord obligations for maintenance and repair to the rental unit, which will be addressed in more detail later, specifically provides that “evidence of compliance with the applicable building and housing codes shall be prima facie evidence that the landlord has complied with this chapter or with any other chapter of Part III of this title (referring to the Code as a whole)”. Therefore, a pre-rental inspection may serve as a partial or complete defense to a later claim for a rent abatement by a tenant based on alleged conditions. Even if a pre-rental inspection is not required, a documented walk through of the actual unit to which the tenant will be given possession is often invaluable. For one, it puts both parties on the same page as far as what the tenant will be receiving and what items within the unit the landlord may need to address. Second, it can help reduce distrust between the parties at the outset and set the stage for a good relationship throughout the tenancy. Lastly, and perhaps most importantly for the landlord, it provides a much more accurate record of the condition of the rental unit at the time the tenant first took possession than the landlord’s or tenant’s later, and likely biased, recollection. Therefore, it is essential to have a checklist of items that the tenant will acknowledge as being acceptable, with any items to be addressed specifically identified. Photographs of the unit taken contemporaneously with the walk through are also highly recommended and can be a tremendous asset at trial in defending a later tenant claim of substandard and defective conditions.
C. Registration with Local Municipalities
Certain municipalities, including the City of Wilmington, City of Newark, City of New Castle and City of Dover, require that landlords register any rental unit. In addition, the New Castle County Code now requires landlords of rental properties within the unincorporated areas of New Castle County to register each unit and provide, among other information, emergency contact numbers. Landlords who fail to comply with registration and other notification requirements are subject to fines, penalties and criminal or civil enforcement.
The importance of maintaining complete and accurate records cannot be overemphasized. A landlord must anticipate that any relationship with a tenant may dissolve to the point where litigation is necessary. In those instances, the party with the better records will generally be the party that prevails. As a result, documenting everything related to the tenancy is essential, from the original application, pre-tenancy inspection or walk-through with photographs and, as will be discussed later, any written notices to or from the tenant. Likewise, if repairs are made during the course of the tenancy, the landlord must maintain copies of invoices for contractors, receipts for items purchased and, if appropriate, photographs of the work performed.
Aside from documenting the physical condition of the rental unit, the financial accounting of the tenancy must be complete and accurate. While handwritten ledgers can and are sufficient, there is really no excuse not to utilize computer software for that purpose. Programs such as Quickbooks, Peachtree Accounting and the like make it very fast and easy for landlords to enter and maintain up to date financial records related to a tenant and the unit. If and when it is necessary to file a Summary Proceeding for Possession, it is very easy to print reports showing tenant payments, application of late fees, etc.
In addition to maintaining records on application fees, a landlord is also obligated to retain records relating to cash payments made by a tenant for rent. 25 Del. C. § 5501 requires a landlord to provide a receipt to a tenant for any cash payments within fifteen days of payment and maintain, for a period of three years, records of all cash receipts for rent.
E. Prepossession Agreements for Repairs and Assurances
If the parties agree before a tenant is to move in that any repairs are necessary, it is advisable for the landlord to effect those repairs as soon as possible. 25 Del. C. § 5303 provides that “the landlord shall supply the rental unit bargained for at the beginning of the term and shall put the tenant into full possession”. That means that the landlord has a statutory duty to provide the rental unit promised for the tenant’s full use and enjoyment at the time the tenant takes possession. If the landlord fails to do so, the tenant has the option to terminate the lease.
For example, if landlord fails to substantially conform to the rental agreement or comply with any code, statute, ordinance or regulation regarding maintenance or operation of the unit, the tenant may terminate within the first month if they have remained in possession in reliance on a promise to correct the condition (§ 5302(a)). Likewise, if the tenant remains in possession in reliance on such a promise to correct and the same act or omission which constituted a prior non-compliance recurs within six months of a prior notice, the tenant may terminate on fifteen days notice. (§ 5302(b)). Lastly, “if there exists any condition which deprives the tenant of a substantial part of the benefit or enjoyment of the tenant’s bargain”, the tenant may notify the landlord and if not corrected within fifteen days, terminate the agreement and sue in Justice of the Peace Court. (§ 5302(c)). Simply stated, if the landlord makes any promises to repair that are reasonably relied upon by the tenant, the landlord must complete those repairs or run the risk that the tenant may lawfully terminate the lease agreement and sue for damages.
2. Lease Agreements
A. Applicability of the Landlord Tenant Code
25 Del. C. § 5101 provides that the Delaware Landlord Tenant Code: “shall regulate and determine all legal rights, remedies and obligations of all parties and beneficiaries of any rental agreement within this State, wherever executed. Any rental agreement, whether written or oral, shall be unenforceable insofar as the agreement or any provision thereof conflicts with any provision of this Code, and is not expressly authorized herein”.
In addition, § 5101(b) excludes leases for commercial rental units from the Code, except for Chapter 57 of Title 25 (dealing with Summary Proceedings for Possession) and Part IV of Title 25.
As provided by 25 Del. C. § 5102, certain arrangements are excluded from the Code, “unless created solely to avoid such application”:
- Residence at a private or public institution where residence is incidental to detention or the provision of medical, geriatric, educational, counseling, religious or similar services, including, but not limited to, prisons, college or school provided student housing, nursing homes, monasteries/nunneries and hospitals.
- Residence by a member of a fraternal organization in a structure operated for the benefit of the organization.
- Residence in a hotel, motel or similar lodgings.
- Non-renewable rental agreements of 120 days or less for any calendar year for a dwelling located within the boundaries ofBroadkill, Lewes-Rehoboth, Indian River and Baltimore Hundreds in Sussex County.
- A rental agreement for ground upon which improvements were constructed or installed by the tenant and used as a dwelling, where the tenant retains ownership or title thereto, or obtains title to an existing improvement on the property
C. Written vs. Oral
Contrary to what a number of tenants (and perhaps a number of landlords) believe, there is no requirement for a lease to be in writing to be valid and enforceable. However, 25 Del. C. § 5106(a) provides that a lease must be in writing to be effective for a term of longer than one year. In addition, for a mobile home or lot in a mobile home park, 25 Del. C. § 7004 requires that a lease be in writing to be effective and that certain information, including rules and regulations, fees charged for services and a copy of the Mobile Home Lots and Leases Act be delivered to a current or prospective tenant before they sign a lease or occupy a premises. Regardless whether the unit in question requires a written lease, there is no question that a landlord simply must have a written lease to properly protect its interests. In addition, as will be seen later, certain provisions, such as late fees, returned check fees or increase in security deposit must be in writing to be enforceable.
D.Term of and Contents of Lease
When there is a written lease, 25 Del. C. § 5105 requires that the landlord provide a copy to the tenant free of charge. What is in that written lease, however, may vary greatly depending upon the experience and needs of the landlord. At a minimum, it is recommended that a written lease contain the address and description of the premises, including whether a garage, basement, storage area or the like are part of the rental, as well as the following provisions:
(1) Term of the lease and Use of Premises - State commencement and ending dates of lease and that premises is to be used only as tenant’s abode (§ 5507(c));
(2) Rent - The rental amount and late fee, as well as the dates on which rent is due and when a late fee will be applied (Note that a landlord may not charge more than 5% of the monthly rental amount as a late fee and it must be specifically stated in the lease to be enforceable - 25 Del. C. § 5501);
(3) Utilities - Identify those that each party is responsible for;
(4) Occupancy - identities of all parties to whom occupancy is permitted, including minor children (Any adults should also be named tenants under the lease);
(5) Pets - Whether pets are permitted and if so, the amount of any pet deposit (If pets will be permitted, it is recommended to identify the type in the lease and that they are only permitted with the landlord’s written consent;
(6) Security Deposit - Amount of the Security Deposit, whether the tenant will be entitled to interest, statement that it is not to be used as the last month’s rent and that the landlord reserves the right to request an increase in the deposit commensurate with any increase in rent during the tenancy;
(7) Condition, Maintenance, Repairs and Alterations – An acknowledgment by the tenant that the premises are in good working order and repair unless specifically stated in the lease or other contemporaneous writing to the contrary; maintenance of the premises by the tenant in a clean and sanitary manner; acknowledgment by the tenant that they are responsible for damage they or their guests/invitees cause; maintenance of exterior grounds by the tenant, if appropriate; and that no alterations may be made without landlord’s prior written consent;
(8) Right of Entry for Inspection;
(9) Indemnification - Except as prohibited by the Landlord/Tenant Code, that the landlord is not responsible for damage or injury unless the proximate result of landlord’s or their agents/employee’s negligence or unlawful act;
(10) Insurance - Tenant required to maintain insurance on their property;
(11) Assignment and Subletting - Tenant may not assign the Lease at all and may only sublease with prior written consent of the landlord, which may not be unreasonably withheld;
(12) Returned Check Charge - State fee that tenant is responsible for should a check be returned for insufficient funds, that such fee is additional rent and that more than one such returned check will require future payments by cash or certified funds;
(13) Tenant’s Employment;
(14) Summary of Landlord/Tenant Code - Have tenant initial for receipt of the Attorney General’s Summary of the Code;
(15) Default by Tenant
(16) Extended Absences - Tenant required to provide written notification of absences more than several days;
(17) Rules and Regulations;
(18) No Waiver by Failure to Enforce by Landlord
(20) Holding Over - What amount will be owed for rent if a tenant holds over without permission of landlord or what the term of the lease shall be, if the holdover is with consent;
(21) Additional Provisions - Any terms material as between the parties not covered elsewhere;
(22) Time of the Essence
(23) Modification by Signed Writing only While there are no statutory requirements for what must be in residential leases, there are certain things that are not permitted. 25 Del. C. § 5301 states as follows:
“(a) A rental agreement shall not provide that a tenant:
(2) Agrees to waive or forego rights or remedies under this Code;
(3) Authorizes any person to confess judgment on a claim arising out of the rental agreement;
(4) Agrees to the exculpation or limitation of any liability of the landlord arising under law or to indemnify the landlord for that liability or the costs connected therewith.
(b) A provision prohibited by subsection (a) of this section which is included in the rental agreement is unenforceable. If a landlord attempts to enforce provisions of a rental agreement known by the landlord to be prohibited by subsection (a) of this section the tenant may bring an action to recover an amount equal to 3 months rent, together with costs of suit but excluding attorneys' fees.
Notice or service of process under the Landlord Tenant Code may be effected by personal service on either party, on the tenant by leaving a copy at the rental unit or usual abode with an adult resident, upon the landlord by leaving a copy at the landlord’s address set forth in the lease or as otherwise provided by the landlord or with an agent or employee whose job it is to accept such notice. 25 Del. C. § 5113(a). In lieu of personal service, notice may be sent by registered, certified or first class mail with certificate of mailing to the tenant at the rental address or the landlord at the landlord’s address set forth in the lease or as otherwise provided by the landlord or, if the landlord is an artificial entity, at its office or place of business. 25 Del. C. § 5113(b). However, 25 Del. C. § 5114 provides that a party has notice of a fact if they have actual knowledge, received a notice pursuant to § 5113 or, from all the facts and circumstances, the person had reason to know it exists.
F. Summary of Landlord Tenant Code
25 Del. C. § 5118 requires that a landlord supply to a new tenant, at the beginning of the lease term, a summary of the Landlord Tenant Code as prepared by the Consumer Protection Unit of the Attorney General’s Office, a copy of which is available online and is also included in the Appendix. The Summary provides a synopsis of the most commonly applicable portions of the Code with respect to landlord tenant disputes and provides direction to each party in the event a review of the complete Code is appropriate. Note that, despite the proliferation of internet ready devices and common familiarity with websites, a landlord cannot simply provide a link to one of the numerous locations containing an online copy of the Code or Summary.
In addition, § 5118 provides that if the landlord fails to provide a copy of the Summary, the tenant may plead ignorance of the law as a defense. However, those defenses are not absolute and would not, for example, include a defense as to the failure to pay rent when due.
The New Castle County Housing Act provides a similar requirement for a landlord to provide tenants in rental units within the unincorporated areas of New Castle County with a copy of the Tenant’s Rights Guide, a copy of which is provided in the Appendix. That Guide only provides a summary of or reference to a limited number of Landlord/Tenant Code sections. Instead, it is a general informational guide on various responsibilities under the law and the means by which a tenant may make an appropriate complaint to either the landlord or New Castle Code Enforcement.
3. Security Deposits
25 Del. C. § 5514(a) (1) states that “a landlord may require the payment of a security deposit”. § 5514(c) further provides that “the purpose of the security deposit shall be:
(1) To reimburse the landlord for actual damages caused to the premises by the tenant which exceed normal wear and tear, or which cannot be corrected by painting and ordinary cleaning; and/or
(2) To pay the landlord for all rental arrearage due under the rental agreement, including late charges and rental due for premature termination or abandonment of the rental agreement by the tenant; and/or
(3) To reimburse the landlord for all reasonable expenses incurred in renovating and rerenting the premises caused by the premature termination of the rental agreement by the tenants, which includes termination pursuant to § 5314 of this title, provided that reimbursement caused by termination pursuant to § 5314 of this title shall not exceed 1 month’s rent”
While the Landlord Tenant Code specifically authorizes a landlord to require a tenant to pay a security deposit, for a variety of reasons, e.g. a leasing promotion, not all landlords take advantage of that right. When they do, generally speaking, a landlord may not require payment of a security deposit in excess of one month’s rent except for federally assisted housing regulations. See § 5514(a). On the other hand, where the term of the lease is undefined or month to month, the landlord may charge more than one month’s rent as a deposit. However, once the tenancy lasts more than one year, the landlord is required to immediately return to the tenant any amount in excess of one month’s rent.
The only absolute exception to these requirements occurs when the lease involves a furnished unit. See § 5514(a)(4). In that instance, there is no statutory limit on the amount the landlord may charge, so theoretically, the landlord could charge whatever amount it deemed appropriate. However, despite the lack of an upper limit, a landlord would likely still be required to demonstrate the requested amount was reasonable. In that situation, the equivalent of several months rent would likely not be unreasonable, provided the furnishings were of adequate quality and in good condition.
If the tenant resides in the rental unit for more than one year, it is quite possible the monthly rent will increase. 25 Del. C. § 5514(j) provides that the landlord may increase the security deposit commensurate with the new monthly rental amount, provided that right has been reserved in the rental agreement. However, if the increase in the security deposit will exceed 10 percent of the monthly rent, payment by the tenant must be prorated over the term of the rental agreement (e.g. one year), except where the term is month-to-month, it shall be prorated over four months.
It is also important to keep in mind that a security deposit is not considered rent. Therefore, the landlord may not file a Summary Proceeding for Possession if a tenant fails to pay either the initial security deposit or a subsequent increase in the deposit based on a demand contained in a five day letter (to be discussed later). However, the landlord may be able to address such a failure as a lease violation, send the tenant a seven day letter (also to be discussed) and file a Summary Proceeding if the tenant fails to comply in a timely manner.
C. Surety Bond as Security Deposit Substitute
25 Del. C. § 5514A was added to the Landlord Tenant Code in 2013 to allow a tenant the option to purchase a surety bond as a substitute for, or supplement to, a security deposit. However, as with a traditional security deposit, the total amount cannot exceed the amount of one month’s rent for leases of one year or more or if a month-to-month lease has exceeded one year except as provided in § 5514(a)(3) relating to federally assisted housing regulations.
The stated purpose of the surety bond under the statute is identical to that of a security deposit and includes reimbursement for damages exceeding normal wear and tear and rent arrearage. In addition, the surety bond option is just that, optional, and a landlord is not required to accept the tenant’s purchase of a bond instead of paying a traditional security deposit. Likewise, a landlord may not require a tenant to purchase a surety bond in lieu of a security deposit.
25 Del. C. § 5514(b) requires that security deposits be deposited in an escrow bank account in a federally insured banking institution with an office that accepts deposits within the State of Delaware and the location disclosed to the tenant. The account must be designated as a security deposits account and cannot be used in the operation of any business by the landlord. Furthermore, the tenant’s claim to the security deposit is superior to that of any creditor of the landlord, even if the landlord files bankruptcy.
What this means for the landlord is that the security deposit must be deposited in an escrow account within an institution whose deposit accounts are insured by either the Federal Deposit Insurance Company (FDIC) or the National Credit Union Administration (NCUA) and has a physical branch somewhere in Delaware that accepts deposits. This includes out of state banks that have local branches, but does not include internet banks that do have a physical branch in Delaware. The deposit must be in an account and cannot be in the form of a CD, mutual fund or annuity. In addition, while it can be commingled with other deposits, it cannot be in an account from which any withdrawals or debits are made concerning any business operation, other than to reimburse the landlord for damages or rent at the conclusion of the tenancy. Failure by the landlord to deposit it in a proper account shall constitute a forfeiture of the security deposit and if not returned to the tenant within twenty days of the effective date of forfeiture entitles the tenant to double the amount. See, 25 Del. C. § 5514(g)(2)
E. Disclosure to Tenants
5514(g)(2) also requires a landlord to disclose the location of security deposit within twenty days of a written request by the tenant. Like a failure to place it in a proper account, if a landlord fails to disclose the location within twenty days, it constitutes a forfeiture of the deposit and if not returned within twenty days thereafter, the tenant is entitled to double the amount. One way to circumvent that possibility is to disclose the location in the lease itself, so the tenant is on written notice from the outset of the tenancy. However, if the tenant makes a request for disclosure at a later point in the tenancy, the landlord should provide a timely response to avoid any liability.
F. Pet Deposits
As with a security deposit, a landlord may require a pet deposit. 25 Del. C. § 5514(i) provides that the pet deposit may not exceed one month’s rent regardless of the duration of the rental agreement. However, a landlord may not require a pet deposit where the pet is a duly certified and trained support animal for a disabled person who is a resident of the rental unit. Where permitted, damage to the unit caused by the animal shall first be deducted from the pet deposit and, if insufficient, from the security deposit. Note, though, that damage not caused by a pet cannot be deducted from the pet deposit. The pet deposit must also be held in accordance with all the requirements of a regular security deposit.
4. Landlord’s Obligations to Tenant
A. Supplying and Maintaining the Rental Unit
As noted previously, 25 Del. C. § 5303 provides that “the landlord shall supply the rental unit bargained for at the beginning of the term and shall put the tenant into full possession”. Generally speaking, most landlord’s obligations in supplying and maintaining that rental unit flow from 25 Del. C. § 5305. That section requires the landlord to:
(1) Comply with all applicable provisions of any state or local statute, code, regulation or ordinance governing the maintenance, construction, use or appearance of the rental unit and the property of which it is a part;
(2) Provide a rental unit which shall not endanger the health, welfare or safety of the tenants or occupants and which is fit for the purpose for which it is expressly rented;
(3) Keep in a clean and sanitary condition all common areas of the buildings, grounds, facilities and appurtenances thereto which are maintained by the landlord;
(4) Make all repairs and arrangements necessary to put and keep the rental unit and the appurtenances thereto in as good a condition as they were, or ought by law or agreement to have been, at the commencement of the tenancy; and
(5) Maintain all electrical, plumbing and other facilities supplied by the landlord in good working order.
In addition, if provided for by the terms of the lease, the landlord shall provide for trash receptacles and removal and supply or cause to be supplied water, hot water, heat and electricity. The parties may also agree by a separate written agreement that the tenant is to perform specified repairs, maintenance, alterations or improvements if:
(1) The work is for the primary benefit of the rental unit; and
(2) The work is not necessary to bring a noncomplying rental unit into compliance; and
(3) Adequate consideration apart from a provision of the lease or a reduction in rent is exchanged; and
(4) The agreement is entered into in good faith and is not for the purpose of evading an obligation of the landlord.
What this all means is that a landlord must supply a unit fit for habitation, complying with all applicable housing standards, and maintain and repair it, as necessary, to keep it in compliance during the term of the tenancy
- Tenant Obligation to Report Defective Conditions. 25 Del. C. § 5505(a) requires a tenant to put a landlord on notice, in writing and as soon as practicable, of any defective condition which the tenant has reason to believe is the duty of the landlord or of another tenant to repair. If the tenant fails to report the condition to the landlord, the tenant shall be responsible for any liability or injury resulting to the landlord
- Tenant Claim for Rent Abatement. If a landlord fails in their obligations under § 5305 or otherwise, they may be held liable to the tenant for a rent abatement, which is a judicially ordered reduction in the amount of rent a tenant is obligated to pay. Generally speaking, a tenant will be entitled to a rent abatement if the landlord either had knowledge of, or was put on notice of, a condition within the unit that is the landlord’s responsibility to maintain and the landlord failed to repair or remedy in a timely and appropriate manner. A rent abatement may be either prospective or retroactive or both, if appropriate and is awarded for the period of time starting when the landlord knew, or should have known, of a condition requiring repair and lasting until finally remedied. The amount of the abatement is at the discretion of the Court, but is calculated on either a percentage or flat fee basis based on the extent to which the tenant’s use and enjoyment of the rental unit has been decreased due to the defective or unrepaired condition(s). In addition, the landlord may also be liable for other damages, such as the cost of replacement housing, as well as face the possibility of a judicially ordered termination of the lease following proper notice by a tenant. However, if a tenant fails to put the landlord on notice of the condition and the landlord demonstrates they did not otherwise know of it, no rent abatement will be awarded
B. Essential Services
With respect to essential services, which consist of hot water, heat, water or electricity or any condition which materially deprives a tenant of a substantial part of the benefit of the tenant’s bargain in violation of either the lease, Landlord/Tenant Code or applicable housing code, a landlord has a heightened obligation. 25 Del. C. § 5308 provides that if there is a failure to supply or remedy these essential services for 48 hours or more following actual or written notice by the tenant, the tenant has the option to immediately terminate the lease or retain two thirds per diem rent during the period that heat, water, electricity or equivalent substitute housing is not provided. The tenant may also bring suit for additional damages. However, under § 5308(a)(2), impossibility of performance on the landlord’s part is a defense.
In addition, if the landlord files a Summary Proceeding claiming that the tenant has wrongfully withheld rent under § 5308 and the Court so finds, the landlord is entitled to a judgment for either possession or damages in the amount wrongfully withheld. If the Court finds that the tenant withheld rent in bad faith, the landlord is entitled to double the amount improperly withheld as damages. Those damages or double damages must then be paid within ten days of the date of judgment or it will become a judgment for both damages and possession to the landlord, without further notice to the tenant.