The Truth in Renting Act (TRA), MCL 554.631 et seq., is applicable only to residential premises subject to written rental agreements. See MCL 554.632(a). The TRA serves two purposes:
•it prohibits certain provisions from being included in written residential leases, and
•it requires certain provisions to be included in written residential leases. MCL 554.634(1).
A.Specifically Prohibited Clauses
The following clauses are specifically prohibited by MCL 554.633 of the TRA from inclusion in written leases. If such a provision is included in a lease, the provision is void. MCL 554.633(3).
1.Waiver of Remedy Available for Violation of Covenants of Fitness and Habitability
The TRA prohibits any clause that “waives or alters a remedy available to the parties when the premises are in a condition that violates the covenants of habitability and fitness required [by] . . . MCL 554.139.” MCL 554.633(1)(a).
2.Waiver of Security Deposit Rights
Clauses that purport to waive any rights granted to parties under the Landlord-Tenant Relationship Act (LTRA), MCL 554.601 et seq., are prohibited and void. MCL 554.633(1)(b). See Section 2.1 for more information on security deposits.
3.Discrimination and Exclusion of Certain Persons
Lease provisions that exclude or discriminate against persons in violation of the Elliott-Larsen Civil Rights Act (ELCRA) (MCL 37.2101 et seq.) on the basis of the religion, race, color, national origin, age, sex, height, weight, familial status, or marital status of a person, or of a person residing with that person, are prohibited and void. MCL 37.2102(1); MCL 37.2502(1); MCL 554.633(1)(c).
Also prohibited is any clause in violation of the Persons With Disabilities Civil Rights Act (PWDCRA) (MCL 37.1101 et seq.). MCL 37.1502(1); MCL 554.633(1)(c). See Section 1.7 and Section 5.5 for more information on housing discrimination.
Confession of judgment clauses are prohibited. MCL 554.633(1)(d).
5.Waiver of Landlord Liability Imposed by Law
Provisions which exculpate landlords from liability imposed by law are prohibited.1 MCL 554.633(1)(e).
Any clauses that waive a tenant’s right to trial by jury,2 to notice,3 or to any other procedural rights provided by the Summary Proceedings Act, or by the anti-lockout law, are prohibited. MCL 554.633(1)(f). See Chapter 4 for information on summary proceedings.
7.Court Costs and Attorney Fees
Some leases include clauses imposing collection costs upon a tenant that attempt to include attorney fees and/or court litigation costs incurred in collecting rent or in bringing an eviction action. Under the TRA, such provisions are prohibited except for the fees and costs permitted by statute. MCL 554.633(1)(g).
8.Lien on Personal Property of the Tenant
Clauses which grant the landlord a security interest in any personal property of the tenant to assure payment of rent or other charges are prohibited unless specifically allowed by law.4 MCL 554.633(1)(h).
Acceleration clauses are prohibited, “unless the [clause] also includes a statement that the tenant may not be liable for the total accelerated amount because of the landlord’s obligation to minimize damages, and that either party may have a court determine the actual amount owed, if any.” MCL 554.633(1)(i).
10.Waiver of Rights in Summary Proceedings and Lockout Cases
Any clause purporting to waive a tenant’s rights with regard to summary proceedings5 for eviction (MCL 600.5701 et seq.) or with regard to illegal detainer, lockout, or interference with possession6 (MCL 600.2918) is prohibited and void. MCL 554.633(1)(j). See also MCL 600.2918(7), which states that “[t]he provisions of this section may not be waived.”
11.Release From Duty to Mitigate
A provision that releases a party from the duty to mitigate damages in the event of a breach is prohibited and void. MCL 554.633(1)(k).
A provision that permits the landlord to modify the lease after its commencement without the written consent of the tenant is prohibited except for certain specific reasons. MCL 554.633(1)(l). “[A]n agreement may provide for the following types of [unilateral] adjustments to be made upon written notice of not less than 30 days[:]”
•Changes that are required by federal, state or local law or rule or regulation. MCL 554.633(1)(l)(i).
•Changes in rules that are required to protect the health, safety, or peaceful enjoyment of tenants and guests. MCL 554.633(1)(l)(ii).
•Changes in rental payments that are needed to cover additional operating costs caused by increases in property taxes, certain utility rates, or premiums paid for liability, fire, or workers compensation insurance. MCL 554.633(1)(l)(iii).
Cooperatives are also covered by MCL 554.633(1)(l).
13. Violations of the Michigan Consumer Protection Act (CPA)
Any lease provision that violates the CPA (MCL 445.901 et seq.) is prohibited and void.7 MCL 554.633(1)(m).
Any lease provision “requir[ing] the tenant to give the lessor a power of attorney” is prohibited and void. MCL 554.633(1)(n).
15.Provisions Declared Unenforceable
“A rental agreement shall not include a clause or provision that, not less than 90 days before the execution of the rental agreement, has been prohibited by statute or declared unenforceable by a published decision of the supreme court of this state or the United States [S]upreme [C]ourt relating to the law of this state.” MCL 554.633(2).
B.Specifically Required Clauses
MCL 554.634 requires the following items to be included in a written lease:
“(1) A rental agreement shall state the name and address at which notice required under this act shall be given to the lessor.
(2) A rental agreement shall state in a prominent place in type not smaller than the size of 12-point type, or in legible print with letters not smaller than 1/8 inch, a notice in substantially the following form:
NOTICE: Michigan law establishes rights and obligations for parties to rental agreements. This agreement is required to comply with the Truth in Renting Act. If you have a question about the interpretation or legality of a provision of this agreement, you may want to seek assistance from a lawyer or other qualified person.” MCL 554.634(2).
In addition to these clauses, the Landlord-Tenant Relationship Act (LTRA) requires notice of a tenant’s right to seek release of his or her rental obligation under MCL 554.601b (reasonable apprehension of present danger from domestic violence, sexual assault, or stalking).8 The written notice must be either in the form of a clause in the rental agreement, posted so that it is “visible to a reasonable person in the landlord’s property management office[,]” or delivered “to the tenant when the lease agreement is signed.” MCL 554.601b(1).
C.Remedies and Actions for TRA Violations
a.Lease Contains Prohibited Provision
If a tenant believes that a clause in his or her lease violates MCL 554.633, he or she must send written notice to the landlord specifying the prohibited clause and its defect. See MCL 554.636(1). However, “[a] tenant may exercise the remedies of [MCL 554.636] without the prior notice required by . . . [MCL 554.636(1)] under any of the following circumstances:
(a) If a rental agreement contains a provision which has previously been determined by a court of record to be in violation of [MCL 554.633] in an action to which the lessor was a party.
(b) If a rental agreement contains a provision which the lessor actually knew was in violation of [MCL 554.633] at the time the rental agreement was entered into.” MCL 554.636(3).
For purposes of MCL 554.636(3)(b)-(c), actual knowledge must be
“established by written documentation evidencing the actual knowledge, written or issued by the lessor or an agent of the lessor who is authorized to execute rental agreements or by an admission evidencing actual knowledge, made by the lessor or an agent of the lessor who is authorized to execute rental agreements or by showing the lessor has previously given notice under [MCL 554.635] relating to the same provision which is the subject of the current action.” MCL 554.636(3)(c).
b.Lease Does Not Contain Required Provision
If a tenant believes that his or her lease violates MCL 554.634, he or she must send written notice to the landlord specifying the missing clause. See MCL 554.636(2). However, “[a] tenant may exercise the remedies of [MCL 554.636] without the prior notice required by . . . [MCL 554.636(2)] under . . . the following circumstances:
(c) If a rental agreement does not include a provision as required by [MCL 554.634] and the lessor actually knew that the provision was not included as required at the time the rental agreement was entered into.” MCL 554.636(3).
2.Required Notice by Landlord—Cure
a.Lease Contains Prohibited Provision
Upon receiving notice from a tenant that the lease contains a prohibited provision, the landlord has 20 days to cure the violation by:
•giving written notice to all current tenants that the clause is void and unenforceable, or
•altering the provision to bring it into compliance with the law. MCL 554.635(1).
Notice may be provided “to the tenant at the address of the leased premises” by personal service, first-class mail, or certified mail. MCL 554.635(3).
b.Lease Does Not Contain Required Provision
Upon receiving notice from a tenant that the lease does not contain a required provision, the landlord has 20 days to cure the violation “by giving written notice to all tenants who are currently parties, with the lessor, to a rental agreement which does not include a required statement. The notice shall set forth the statement as provided in [MCL 554.634].” MCL 554.635(2).
Notice may be provided “to the tenant at the address of the leased premises” by personal service, first-class mail, or certified mail. MCL 554.635(3).
3.Action and Remedies Available if Violation Not Cured
a.Lease Contains Prohibited Provision
“If a rental agreement contains a provision which violates [MCL 554.633], and if the landlord fails to cure the violation by exercising the notice provisions of [MCL 554.635] within 20 days after the tenant gives written notice to the landlord of the provision believed to be in violation and the reason therefor, a tenant may bring an action for any of the following relief:
(a) To void the rental agreement and terminate the tenancy.
(b) To enjoin the lessor from including the provision in any rental agreement subsequently entered into and to require the lessor to cure the violation in all rental agreements in which the provision occurs and to which the lessor is currently a party.
(c) To recover damages in the amount of $250.00 per action, or actual damages, whichever is greater.” MCL 554.636(1)(a)-(c).9
In addition,
“If a rental agreement . . . contains a provision which is explicitly and unambiguously prohibited by [MCL 554.633], and if the landlord fails to cure the violation by exercising the notice provisions of [MCL 554.635] within 20 days after the tenant, or, where there is more than one plaintiff, each tenant, gives written notice to the landlord of the provision . . . believed to be in violation and the reason therefor, a tenant may bring an action for any of the following relief:
(a) To avoid the rental agreement and terminate the tenancy.
(b) To enjoin the lessor from including the provision which violates [MCL 554.633] in any rental agreement subsequently entered into and to require the lessor to exercise the notice procedure provided in [MCL 554.635] to cure the violation in all rental agreements in which the provision occurs and to which the lessor is currently a party.
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(d) To recover damages in the amount of $500.00, or actual damages, whichever is greater.” MCL 554.636(2).
However,
“If a rental agreement contains the provisions as required by [MCL 554.634] but contains a provision which violates [the TRA], solely because of a judicial construction by a court of record of a provision of a statute cited in [MCL 554.633] in an action to which the lessor was a party, the lessor shall not be subject to the penalties of [the TRA] unless the lessor fails to cure the violation by exercising the notice provisions of [MCL 554.635] within 30 days following the final determination by the court.” MCL 554.636(6).
“A party who prevails in an action under [MCL 554.636] is entitled to recover court costs plus statutory attorney fees.” MCL 554.636(4).
b.Lease Does Not Contain Required Provision
If the landlord fails to cure a violation of MCL 554.634, the tenant may seek the relief set out in MCL 554.636(2):
“If a rental agreement fails to contain a provision as required by [MCL 554.634] . . . , and if the landlord fails to cure the violation by exercising the notice provisions of [MCL 554.635] within 20 days after the tenant, or, where there is more than one plaintiff, each tenant, gives written notice to the landlord of the . . . absence of a provision believed to be in violation and the reason therefor, a tenant may bring an action for any of the following relief:
(a) To avoid the rental agreement and terminate the tenancy.
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(c) To enjoin the lessor from failing to comply with [MCL 554.634] in any rental agreement subsequently entered into and to require the lessor to exercise the notice procedure provided in [MCL 554.635] to cure the violation.
(d) To recover damages in the amount of $500.00, or actual damages, whichever is greater.”
“A party who prevails in an action under [MCL 554.636] is entitled to recover court costs plus statutory attorney fees.” MCL 554.636(4).
Where a commercially printed rental agreement form contains a prohibited clause, omits a required clause, or includes a clause that has been declared unenforceable by a decision of the Michigan or United States Supreme Court not less than 90 days before the sale of the form, the seller of the lease form “shall be liable” to the landlord for any damages the landlord must pay to a tenant who brings an action against the landlord under the TRA. MCL 554.638.
1 However, this provision does not apply to lease clauses that release landlords from liability arising from loss or damage due to fire or other casualty for which the tenant carries insurance where the policy permits waiver of liability. MCL 554.633(1)(e).
2 MCL 554.633(1)(f). See also MCL 445.903(1)(h).
4 See, for example, the Innkeepers Lien Act, MCL 427.201, which allows a lien on the personal property of certain persons, including tenants, in inns, boardinghouses, lodging houses, bed and breakfasts, and furnished apartments.
5 See Chapter 4 for information on summary proceedings.
6 See Section 1.3 for more information on interference with possession.
7 See Section 1.2(D) for more information on the CPA.
8 See Section (F) for more information.
9 According to MCL 554.636(5):
“All actions brought under [MCL 554.636(1)] with respect to a particular provision of a rental agreement shall be joined, and only 1 judgment for damages of $250.00 shall be awarded with respect to a particular provision even if there are multiple actions or multiple plaintiffs if, before judgment in the initial action and before the passage of 30 days after service of process in any second action, the lessor gives written notice to all tenants who are currently subject to that provision, stating that the enforceability of the provision is under dispute and may be determined by a court of law.”