Tenant or Landlord: Who Pays the Dues? Where Does the Responsibility Lie?

The Most Confused Topic: Whose Debt Are the Dues?

Apartment managements frequently face this dilemma: the tenant is not paying the dues, and the landlord says "my tenant lives there, let them pay." So who is legally responsible? The answer requires separating the rental contract from the Condominium Ownership Act (KMK).

The Rental Contract and Legal Responsibility Are Different

Most rental contracts include the clause "dues shall be borne by the tenant." This is a valid agreement between the landlord and the tenant and ensures that the tenant actually pays the dues. However, this agreement does not bind the apartment management.

From the standpoint of the KMK, the party primarily responsible for the dues is the registered owner of the unit — the unit owner. Even if the tenant makes the payment under the rental contract, the party legally obliged is the owner.

What Happens if the Tenant Doesn't Pay?

This is where the critical point emerges. If the tenant fails to pay the dues and moves out, the party the apartment management will pursue is not the tenant but the landlord. This is because the management's counterparty is the title holder. The landlord is forced to pay the dues the tenant failed to pay; they may then recover the amount from the tenant if they choose.

Advice to landlords: keep track of whether your tenant is paying dues regularly. Accumulated dues debt will, one day, come knocking at your door.

Joint Responsibility

In practice, management may pursue both the tenant and the owner. The tenant may be held responsible for the dues of the period in which they occupied the unit; however, the tenant's liability is usually limited to the amount they are obliged to pay, and the amount they pay is deducted from their rent debt. The owner is liable for the entire debt. That is why, to ensure collection, management pursues the owner in the surest manner.

What About Old Debts When the Unit Is Sold?

Another frequently asked question: I bought the unit — does the previous owner's dues debt transfer to me? The general rule is that personal debt (the previous owner's unpaid dues) does not transfer directly to the new owner; however, due to mechanisms such as the statutory mortgage under the KMK and the pursuit of the unit itself, before purchase you should always confirm with the management whether the unit has any dues debt.

In Summary

• A rental contract may place dues on the tenant; this is valid between landlord and tenant.
• From management's standpoint, the party primarily liable is always the unit owner.
• If the tenant fails to pay, management pursues the landlord.
• When purchasing a unit, always inquire about dues debt.

Related Topics

Which expense belongs to whom is discussed in our "fixture and advance dues" article, the tenant's obligations under the KMK in our "tenant obligations" article, and the dues status of a vacant unit in our "vacant unit" article.

This content is for informational purposes. Legal advice is recommended for rental and dues disputes.