By Mark Zinman | Zona Law
Question: I am a realtor and manage properties for single-family homeowners. I handle all aspects of management, including running the application, getting the leases completed, and collecting the rent. If a property sells, and a new owner takes over, do I have to give him these documents including the application?
Answer: Your duties are controlled by your property management agreement and the law. The first thing to remember is that you are in the privity of contract with the current owner, not the new owner. If anything, your job is to return documents to your client, and they may have an obligation to return them to the new owner. Ideally, this should be handled before closing, to avoid issues and complications. ARS 32-2173 provides: “Immediately on termination of a property management agreement, the property management firm shall provide the owner with: 1. All originals or other copies of all rental agreements or related documents in the property management firm’s possession for current and previous tenants. These documents shall include any applications, property inventories, leases, pet permits, default notices, lease amendments, or addenda in the property management firm’s possession.” Therefore, if there is a pending sale, which would terminate your management, you do have to return documents to the owner upon request.