Washington State AG Orders Portland Management Company To Pay Over Lease Addendums

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Washington State AG orders Portland property management company to pay over lease addendums

A Portland, Oregon property management company will have to pay $16,000 for requiring service members to sign illegal lease addendums requiring them to forfeit rent concessions if they had to terminate their leases early as a result of change of station or deployment, according to Washington State Attorney General Bob Ferguson.

CTL Management included the addendum on more than 220 leases at Chambers Creek Estates, a large apartment complex in University Place, near Joint Base Lewis-McChord, which houses many military families, according to a release from Ferguson’s office.

 Under the agreement, filed in Thurston County Superior Court, the company will refund a total of $6,000 in rent concessions it illegally recouped from a total of 34 service members who were forced to cancel leases due to military service.

Property management company must pay attorney costs and fees over lease addendum

CTL will also pay $10,360 in attorney costs and fees. CTL stopped using the addendums following the AGO investigation, and will not enforce any addendums still in place. There are currently 67 tenants at Chambers Creek Estates who are service members.

The addendums violate the Washington state and federal Service Members Civil Relief Act (SCRA). The state law, which was amended by legislation requested by Ferguson in 2014, provides financial and legal protections for military service members ordered to federal and state active duty. Those protections include reduced interest rates on preexisting debts, and protections from default judgments.

CTL required service members to sign a “military addendum” to their leases. This addendum forced the service member to return any rent concessions they received at the time they signed in the event they had to terminate early because of deployment or an ordered change of station.  These concessions usually were provided as reductions to first month’s rent or a gift card.  When the service member had to terminate the lease, CTL recouped the full amount of the rent concession — typically $100 to $200 — as part of the final accounting by reducing the amount of the damage deposit refunded or requesting repayment. The service member lost the entire amount of the concession, regardless of how many months remained on the service member’s lease.    

“Our men and women in uniform should not be burdened by unfair costs for serving their country,” Ferguson said in a release. “I won’t allow companies to make our military service members pay for serving their country.”

The agreement represents the Attorney General’s Office’s first case under the SCRA’s 2014 amendments, which made violations of the federal Act a violation of state law, as well. The legislation also gave the Attorney General’s Office authority to enforce the statute. Ferguson has proposed additional protections in an agency request bill this session, along with other legislation to benefit service members.

As part of the agreement, CTL is required to hold annual training for management and other employees on compliance with the SCRA for three years.

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