Analysis Prepared by the Department of Agriculture, Trade and Consumer Protection
This rule regulates transactions between landlords and residential tenants.
Statutes interpreted
Statutory authority
Explanation of statutory authority
DATCP has broad general authority, under s.
93.07 (1), Stats., to interpret laws under its jurisdiction. DATCP has authority under s.
100.20 (2) (a), Stats., to promulgate administrative rules prohibiting trade practices determined by the department to be unfair, and prescribing trade practices determined by the department to be fair.
Section
704.95, Stats., (created by
2011 Wisconsin Act 143 and amended by
2013 Wisconsin Act 76) provides that a violation of ch.
704, Stats., may also be a violation of ch.
ATCP 134, Wis. Adm. Code. But this section also states that the department may not enforce a violation of ch.
ATCP 134, Wis. Adm. Code, in a way that changes a right or duty provided in ch.
704, Stats.
Related statutes and rules
Chapter
704, Stats., regulates transactions between landlords and both residential and non-residential tenants. The department does not administer ch.
704, Stats. (except for s.
704.90, Stats., relating to self-service storage facilities).
Chapter
ATCP 125, Wis. Adm. Code, regulates rental transactions for sites upon which the tenant places a manufactured home owned by the tenant.
Plain language analysis
Background
The department enacted ch.
ATCP 134, Wis. Adm. Code, in 1980 and the rule was revised in 1998. The existing rule regulates rental transactions between landlords and residential tenants as follows:
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Requires the landlord to provide to the tenant before entering into the rental agreement copies of the rental agreement and a receipt for any earnest money or security deposits that the tenant has paid to the landlord.
• Requires the landlord to disclose to the tenant before entering into the rental agreement the names and addresses of the owners and managers, code violations and other conditions affecting habitability, and any utility charges that the tenant may be required to pay.
•
Prescribes procedures for accepting and withholding earnest money fees and credit check fees.
•
Prescribes procedures for handling security deposits.
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Prescribes procedures for promises to repair.
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Prohibits a landlord from including in rental agreements provisions that do the following:
• Authorize unlawful eviction.
• Accelerate rent payments in event of tenant default.
• Require the tenant to pay attorney's fees.
• Authorize the landlord to enter a plea in a court action on behalf of the tenant in which the tenant agrees to accept a judgment against the tenant.
• Relieve the landlord from liability for property damage or personal injury caused by the landlord.
• Impose liability on the tenant for property damage or personal injury not caused by the tenant.
• Waive statutory or legal obligations of the landlord.
• Prohibits a landlord from:
• Advertising or renting condemned premises.
• Unauthorized entries.
• Automatically renewing a lease without notice.
• Unlawfully confiscating personal property.
• Engaging in retaliatory or self-help eviction.
• Charging late rental fees and other penalties not set out in the lease.
• Misrepresenting the dwelling units offered or the amount of all rent and non-rent charges.
• Failing to disclose all non-rent charges in connection with the representation of any rent amount.
Rule content
2011 Wisconsin Act 143 was enacted on March 21, 2012. Act 143 made changes to ch.
704, Stats., that affect some of the provisions of the current rule relating to:
• Disclosures required before entering into a rental agreement.
• Returning security deposits.
• Withholding security deposits.
• Prohibiting certain rental agreement provisions.
• Disposing of personal property left behind by a tenant.
•
Violations of Landlord Tenant law may constitute a violation of Unfair Trade Practices Law.
2013 Wisconsin Act 76 was enacted on December 12, 2013. Act 76, among other things, made additional changes to landlord tenant requirements in ch.
704, Stats., including:
• Disposing of personal property left behind by a tenant.
•
Damage to premises due to action or inaction of the tenant.
•
Check-in sheets.
•
Requiring notice of domestic abuse protections.
•
Prohibition on rental agreement terms that allows landlord to terminate tenancy if a crime is committed in or on the rental property.
This rule makes revisions to ch.
ATCP 134 that are necessary to conform the rule to provisions of ch.
704, Stats. (as amended), and ensure that enforcement of the rule will not change a right or duty provided by ch.
704, Stats.
Definitions
The proposed rule makes a minor, technical revision to the existing rule definition of “dwelling unit" to conform to recent changes in ch.
ATCP 125, Wis. Adm. Code.
The proposed rule revises existing rule definitions of “premises" and “rental agreement" to conform them to the most recent version of ch.
704, Stats.
Disclosures required before entering into a rental agreement
The current rule requires a landlord to make certain disclosures to the prospective tenant before entering into a rental agreement or accepting any earnest money or security deposit. These disclosures relate to various conditions affecting habitability, including uncorrected building code violations.
2011 Act 143 created s.
704.07 (2) (bm), Stats., which requires disclosures relating to building code violations that are generally similar to the disclosures prescribed by the current rule.
This rule repeals and recreates the building code violation disclosure requirement to conform it to the disclosure required by the statute.
Returning security deposits
The current rule establishes a deadline for return of security deposits to the tenant. In most cases, the landlord must return the security deposit with 21 days of the tenant vacating the property.
2011 Act 143 created, and
2013 Act 76 amended, s.
704.28 (4), Stats., which incorporates similar security deposit return requirements. Under the new statutory requirements, if the tenant vacates the property before the end of the rental agreement, and the landlord does not re-rent the property, the landlord must return the security deposit within 21 days of the last day of the rental agreement.
This rule amends the requirement to a return a security deposit to conform to the statutory provision.
Withholding security deposits
Under the current rule, a landlord may withhold a tenant's security deposit only for specific reasons listed in the rule such as damage to the premises; unpaid rent; unpaid utilities or assessments for which the landlord is liable; or other reasons specifically listed in the rental agreement as “nonstandard rental provisions."
Act 143 created s.
704.28 (1), Stats., which incorporates very similar (but not identical) provisions into the statute.
This rule makes minor changes to the provisions relating to withholding a tenant's security deposit to conform to the statute, but does not substantially change the requirements from the current rule. It also makes slight changes related to “nonstandard rental provisions" to conform to s.
704.28 (2), Stats., as created by
2011 Act 143 and amended by
2013 Act 76.
Prohibited rental agreement provisions
The current rule describes provisions that a landlord is prohibited from placing in a rental agreement, such as:
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Authorizing eviction by other than judicial procedure.
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Acceleration of rent payments if tenant breaches obligations.
•
Requiring the tenant to pay landlord's attorney's fees in the event of a dispute.
•
Authorizing landlord to confess judgment against the tenant.
•
Relieving the landlord from liability for damage or injury caused by negligent acts or omissions of the landlord.
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Imposing liability on the tenant for personal injury arising from causes clearly beyond the tenant's control.
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Waiving the obligation of the landlord to deliver and maintain the premises in fit or habitable condition.
2011 Act 143 created and
2013 Act 76 revised portions of s.
704.44, Stats., which identify prohibited rental agreement provisions that are similar, but not identical, to provisions in the current rule. In addition,
2011 Act 143 created two new prohibited rental agreement provisions — allowing the landlord to do certain things because a tenant contacted law enforcement, health, or safety services; or allowing the landlord to terminate the tenancy if a crime is committed on the rental property.
2013 Act 76 refined this particular prohibition to clarify that it applies to a termination of tenancy based solely on the commission of a crime.
2013 Act 76 also adds an additional prohibition against rental provisions that allow termination for a crime committed in relation to the rental property.
Further, Act 143 states that the entire rental agreement is void and unenforceable if it contains any of the prohibited provisions. The current rule does not have such a provision, but instead relies on a test established by the courts to determine whether the entire rental agreement is void based on the inclusion of a prohibited provision.
This rule revises the prohibition on certain rental agreement provisions so that the rule is identical to the new statute. This rule also incorporates the provision in s.
704.44, Stats.,
that declares the entire rental agreement is void and unenforceable if it contains any of the prohibited rental agreement provisions.
Confiscating personal property left behind by the tenant
The current rule prohibits the landlord from confiscating the tenant's personal property except as authorized by law or in accordance with a written lien agreement. The current rule also prescribes the form and manner in which the landlord and tenant may execute the lien agreement.
2011 Act 143 and
2013 Act 76 revised s.
704.05 (5), Stats., to give a landlord the discretion to dispose of personal property left behind by the tenant without a written lien agreement, as long as certain conditions are met. For example, there must not be a written agreement to the contrary, and the landlord must provide notice to the tenant of his or her intent not to store the property before the tenant enters into or renews a rental agreement.
This rule amends the current rule to more closely align it with s.
704.05 (5), Stats. It replaces references to a “written lien agreement" with a more general “written agreement" and imposes conditions on an agreement that allows a landlord to seize or hold a tenant's personal property.
Summary of, and comparison with, existing or proposed federal statutes and regulations
Federal law does not generally regulate landlord and tenant relationships or residential rental practices. The Federal Fair Housing Act of 1968 makes it illegal for a landlord to discriminate against a potential tenant because of a person's race, sex, national origin, or religion, and it prohibits certain discriminatory conduct.
Comparison with rules in adjacent states
Illinois, Iowa, Michigan, and Minnesota all have statutes or administrative rules governing residential rental practices. These laws address common topics such as rental agreements, security deposits, and other duties of landlords and tenants.
Summary of factual data and analytical methodologies
This rule modifies the current rule only to conform it to recent changes to the Wisconsin statutes. DATCP did not conduct any factual or data analysis.
