Arbitration and Mediation Clauses May Limit Rights to Sue
It is fairly common for agreements, including leases, to contain arbitration or mediation clauses. This means you agree that if there is a dispute between you and the landlord you will first try to resolve the conflict outside of court.
This is usually a good thing for both tenant and landlord as long as it does not state that you totally forfeit your rights to sue if an agreement cannot be reached.
These clauses should name a specific mediation or arbitration company – not an individual. The arbitrator should be neutral– not someone affiliated with the landlord or their representative.
Why You Will Not Get Rich Suing Your Landlord
It is important to understand that if your landlord breaches the lease you generally cannot sue for tort damages (i.e., what laypeople commonly refer to as “pain and suffering.") Only in the case of certain types of conduct or “bad faith” is there a possibility of suing a landlord for tort damages.
Suing your landlord is rarely profitable so never sign a lease with the idea that if there is trouble, you can just take a bad landlord to court and win. It is always better to sign an agreement you understand and are comfortable with and only with a landlord you feel you can trust.
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