One of the legal obligations that must be understood most clearly in rental property management is the tenant's "duty of care". To prevent disputes related to tenant contracts, move-outs, and restoration obligations, it is important to have an accurate understanding of the scope of this duty, examples of violations, and how property management companies should respond.
What Is the Duty of Care?
The duty of care (the duty of care of a good manager) is an obligation provided for in Article 400 of the Civil Code. It means "the obligation to manage a property with the level of care generally required under social standards". In a lease agreement, this duty is imposed on the tenant throughout the entire period from contract execution until the property is surrendered.
The Scope to Which the Duty of Care Applies
The scope covers the entire exclusive-use area (walls, floors, windows, and wet areas) as well as common areas subject to exclusive-use rights (balconies, private gardens, and exclusive parking spaces). If stains, damage, or defects arise, tenants are expected to address them promptly or report them to the management company and request repairs.
What Situations Constitute a Violation of the Duty of Care?
A violation occurs when a tenant fails to manage the property in the manner generally expected under social standards, resulting in accelerated deterioration or damage to the property. Specific examples include the following.
- Spilled drinks were left unattended, causing mold to grow on the flooring
- Neglecting to clean wet areas, resulting in severe mold or staining
- Leaving condensation unattended, leading to stains or decay
- Making holes in the wall and damaging the backing board
- Failing to clean the air conditioner filter, causing a breakdown
- Failing to clean the drain, resulting in a blockage
- Leaving a water leak to the lower floor unreported to the landlord or management company, causing damage to the building
These issues are also closely related to the rules on restoration obligations for rental properties.
What Happens If a Violation Occurs?
If a violation of the duty of care is recognized, the following two risks will generally arise.
Refusal to Return the Security Deposit and Claims for Repair Costs
Repair costs for damage or deterioration caused by the violation may be deducted from the security deposit. If the damage is substantial, additional costs exceeding the deposit may also be claimed.
Claims for Damages
If serious damage is caused to the building, such as water leakage to the floor below, the tenant may be liable for damages. However, compensation for fire-related damage is generally not sought unless there was intent or gross negligence.
What Is the Difference Between the Duty of Care and the Obligation to Restore the Property?
The two arise at different points in time.
- Duty of care: An ongoing obligation imposed continuously from move-in until completion of surrender
- Restoration obligation: An obligation that arises at move-out to restore the property to its pre-tenancy condition
If the duty of care is fulfilled in daily life, restoration costs at move-out can be kept to a minimum. Special damage (damage caused by a breach of the duty of care) is subject to restoration, whereas ordinary wear and tear and age-related deterioration are not.
How Property Management Companies Can Help Prevent Violations of the Duty of Care
In rental property management practice, the following approaches are effective.
Thorough Explanations in Important Matters Disclosures and Move-In Checks
At the time of contracting, the content of the duty of care should be explained carefully, and confirming and photographing the condition of the room together with real estate company staff before move-in is a basic measure for preventing disputes.
Ongoing Communication and Regular Inspections
It is important to establish a system in which tenants can report issues easily. By identifying and addressing problems early, the risk of major damage developing can be reduced.
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Where does the risk of violation arise?
Problems related to violations of the duty of care of a prudent manager are more likely to occur when it is unclear when the damage was noticed and how it was handled, rather than the damage itself. If the tenant had contacted us immediately, it would have been a minor repair, but if the repair is left unattended and spread to the bottom of the floor or inside the walls, it becomes difficult to explain the classification of the burden.
In management practice, we separate and check the following four points.
| Items to check | Points to look at | Management company records |
|---|---|---|
| Cause | Intentional/negligent, normal use, aging equipment, defect on the building side | Pictures taken when moving in, repair history, equipment age |
| When it was discovered | When was the abnormality recognized? | Contact with tenants, patrol records, inspection records |
| Notification | Did the tenant promptly report | Email, phone memo, chat history |
| Preventing the spread | Has the damage spread due to neglect? | On-site photos, estimates, and comments from the contractor |
If you tell the tenant, ``This is a violation of the duty of care of a prudent manager,'' without sorting this out, the tenant will not be satisfied. First, we will separate the facts, and then explain the classification of burdens. This order is important.
Initial flow when receiving abnormal notification
In determining the duty of care of a prudent manager, the record of the initial response is of great significance. In particular, when it comes to water leaks, mold, and equipment malfunctions, the time lag between the initial report and response directly leads to increased damage.
It will be easier for the management company to explain the following process by standardizing it.
| Initial response | Implementation details | Records to be kept |
|---|---|---|
| Reception | Check when, from whom, and with what symptoms | Reception date and time, contact person, and symptom notes |
| Photo request | Request general and close-up photos from the tenant | Photos, videos, and date and time of shooting |
| Emergency instructions | Convey actions to prevent damage from spreading, such as water shutoff, ventilation, and suspension of use | Instructions and transmission history |
| Arranging a repair company | Arranging a repair company depending on the degree of urgency | Arrangement date and time, scheduled visit, name of the company |
| Confirm cause | Check equipment deterioration, method of use, and length of time left unused | Contractor report, on-site photos, quotation |
| Cost classification | Sorting out the landlord's burden, tenant's burden, and the possibility of apportionment | Judgment memo, contract terms, explanation history |
This trend is not intended to pursue tenants. Both the fact that the tenant contacted us quickly and the management company's prompt response are both important to keep as records. The more records you keep, the less likely it will be emotional when explaining the payment at a later date.
Judgment table for the duty of care of a prudent manager by case
We will summarize the cases that often arise in rental management from the management company's perspective. The following is a practical guideline, as individual judgments will vary depending on the contract details, property condition, and evidence.
| Cases | Examples where the burden is likely to be borne by the tenant | Examples where the burden is likely to be borne by the landlord | Responses from the management company |
|---|---|---|---|
| Water leak | Water leak was left unattended, causing damage to the flooring and lower floors | Main causes were deterioration of piping and equipment failure | First report date and time, photos, and contractor diagnosis saved |
| Mold | Condensation is left unattended and there is little cleaning or ventilation | Causes include insufficient structural insulation or water leaks | Check the indoor environment, ventilation explanation, and repair history |
| Equipment malfunctions | Neglecting noises and abnormalities to cause more damage | Natural failures due to deterioration over time | Keeping contact history and equipment model year |
| Pets | Breeding in violation of the contract, strong odors, scratches on floors and fittings | Minor signs of use that would normally be expected within the permit conditions | Comparison of special pet provisions, explanation at the time of move-in, and photos of move-out |
| Unauthorized renovation | Holes in the wall, installation of shelves, wiring work, etc. carried out without permission | Work that has already been approved by the landlord | Check whether there is a record of approval |
The point is not to broadly place the responsibility of the tenant. Only claim what can be explained, and do not force yourself to claim what cannot be explained. This will protect the trust between the management company and the owner in the long run.
How should the roles of owners, management companies, and tenants be divided?
Talking about the duty of care of a prudent manager sounds unfair if it is directed only at tenants. In practice, it will be easier to understand if the roles of the owner, management company, and tenant are explained separately.
| Position | Main role | Problems caused by shortage |
|---|---|---|
| Owner | Maintenance of equipment, necessary repairs, and sharing of information with the management company | Even aging and defective equipment can easily be seen as the tenant's responsibility |
| Management company | Explanation at the time of contract, reception of communications, records, repair arrangements, settlement explanation | Judgment criteria become individualized, and explanations become blurred when moving out |
| Tenants | Use with normal care, notify abnormalities early, and prevent damage from spreading | Expanding damage due to neglect is likely to become a problem for tenants. |
If you communicate this division of roles at the time of signing the contract or in the move-in guide, it will be easier for tenants to understand what they should do. The management company can also guide you using the same standards from the time you move in, rather than suddenly bringing up legal jargon when you move out.
How do you explain the boundary between normal wear and tear and aging deterioration?
The most easily misunderstood explanation of the duty of care of a prudent manager is the boundary between normal wear and tear. If you live a normal life, your floors, wallpaper, and equipment will gradually become damaged. If the tenant is responsible for such natural changes, moving out will create a strong sense of distrust.
The Ministry of Land, Infrastructure, Transport and Tourism's guidelines for restoring property to its original state also distinguish between normal wear and tear and aging, and wear and tear caused by the tenant's intention or negligence. The management company should not take the stance of billing you because it's dirty,'' but insteadthere is a cause that exceeds normal usage, so we will provide an explanation and provide evidence.''
For example, sun damage to wallpaper is usually considered wear and tear, while tar stains and odors caused by smoking may be considered a liability for the tenant. Light marks left by furniture are not the same as deep scratches caused by dragging heavy objects.
For more information on the scope and costs of restoration work, What is restoration work? Contents, costs, and troubleshooting that rental owners should know may also be helpful.
Trails and notification flow that management companies should leave
To prevent problems related to the duty of care of a prudent manager, the wording in the contract alone is not enough. Explanations that tenants can understand and records that can be checked later are required.
It is a good idea for the management company to standardize the following flow.
| Timing | Implementation details | Records to be kept |
|---|---|---|
| Before moving in | Check interior photos, equipment condition, scratches and dirt | Photos, check sheet, signature |
| At the time of contract | Explain the duty of care of a prudent manager, duty to notify, and prohibited matters | Explanation of important matters, contract, explanatory memo |
| While moving in | If you receive a report of a problem, record the date and time of reception and the details | Email, call memo, repair request |
| At the time of repair | Organize causes, emergency measures, and cost estimates | Contractor reports, estimates, and photos |
| At the time of moving out | Compare with the record at the time of moving in and explain the burden classification | Record of witnessing the move out, settlement details |
It is especially important to not just tell the resident, ``If there is anything unusual, please contact us as soon as possible.'' By clearly specifying contact information, reception methods, and the scope of emergency response, it will be easier to prevent damage from escalating due to neglect.
How can I explain this to tenants so that they will be easily convinced?
When explaining the duty of care to a tenant, it is important not to impose legal terminology on them. In practice, the following expressions can be used:
- Duty of care: “Duty of care to use the property with the care that is generally required during the rental period.”
- Obligation to notify: "We must notify you as soon as possible of any incidents that are likely to cause widespread damage, such as water leaks or equipment malfunctions."
- Normal wear and tear: "As a general rule, the tenant does not have to bear the burden of parts that naturally age through normal living."
- Tenant's responsibility: ``In the event of damage that exceeds normal usage or damage that spreads due to neglect, we may ask you to bear the cost after confirming the basis.''
The purpose of the explanation is not to make it easier to claim when you move out. In order to prevent damage from spreading during occupancy, the landlord, tenant, and management company need to be on the same page. A management company that does this carefully will be trusted not only for troubleshooting, but also for protecting the owner's assets.
The text of the notification will be easier to convey if it is specified as follows.
If you discover water leaks, mold, unusual noises, or damage to equipment, please contact the management company before the damage spreads. When contacting us, please send us a photo showing the date and time of discovery, location, and condition so that we can quickly arrange repairs and confirm the cause. The tenant will not be required to bear the cost until the property deteriorates due to normal use, but if the damage has spread due to neglect, we may ask the tenant to cover the cost after confirming the situation.
The point of this text is not to impose only obligations on the tenant. By telling them in advance that the product does not have to bear the burden of deterioration due to normal use, it will be easier to encourage early contact.
Frequently Asked Questions (FAQ)
Q. Does age-related deterioration also count as a violation of the duty of care?
No, it does not. Age-related deterioration and ordinary wear and tear that occur despite the tenant having fulfilled the duty of care are not the tenant's responsibility and are not subject to restoration.
Q. What is the difference between a violation of the duty of care and the obligation to restore the property?
The duty of care is an obligation that continues throughout occupancy, while the restoration obligation arises at move-out. Damage caused by a violation of the duty of care becomes subject to the restoration obligation.
Q. Does an air conditioner breakdown count as a violation of the duty of care?
If the breakdown was caused by neglecting to clean the filter, it constitutes a violation. A breakdown due to ordinary aging of the equipment is not the tenant's responsibility.
Q. Are scratches and odors caused by pets subject to restoration?
Yes. Even in pet-friendly properties, scratches on pillars and odors caused by pets are treated as special damage and are subject to restoration.
Q. How can a property management company make tenants aware of the duty of care?
Careful explanations in the important matters disclosure, use of a move-in checklist, and sending regular maintenance guidance are all effective measures.
Q2. If mold appears, is it always a violation of the duty of care?
A. It is not necessarily a violation. If the problem spreads due to lack of cleaning or ventilation, it is likely to become a problem, but if the cause is due to the building structure, water leakage, or malfunctioning equipment, the landlord may need to take action.
Q3. If equipment defects are left untreated, will the tenant be responsible?
A. If the tenant does not contact us for a long time after noticing something abnormal and the damage increases, the tenant will be considered responsible for the liability. However, if the main cause is aging equipment or initial failure, we will check the records and make a decision.
Q4. What should the management company record?
A. You should leave a series of photos when moving in, check sheets, explanations at the time of contract, contact history during tenancy, report from the repair company, photos when moving out, and payment details. The more records are connected, the more objective the explanation will be.
Q5. Does the duty of care of a prudent manager also apply to owners?
A. Yes. If the owner neglects to maintain the equipment, make necessary repairs, and share information with the management company, it will be difficult to explain how to place the responsibility solely on the tenant.
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