Tips and Tricks for Negotiating Pet-Friendly Leases

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Daniel Johnston

By Daniel C. Johnston

Commercial leases include many dangerous pitfalls and traps ready to snarl unsuspecting parties. From rent to insurance, taxes to operating expenses, both landlords and tenants spend hours poring over provisions to ensure a successful partnership. This is no truer than when it comes to the topic du jour, pet friendly leases. Over sleepless nights, the parties have negotiated common issues like scope (whether dogs, cats, and snakes are allowed), insurance (whether the insurance company will cover pet-related injuries), and assignments (whether the right should be personal to the original tenant). And though these topics are important to a successful pet policy, both parties have probably tiptoed around the 800-pound gorilla in the workplace, the Americans with Disabilities Act of 1990. Now it is time to explore the “ADA,” its Massachusetts counterpart (Massachusetts Service Animal Law or “MSAL”), and their impact on our furry companions.

Photo by Manuel Meza on Unsplash

The ADA prohibits disability-based discrimination in “places of public accommodation.” A place of public accommodation is, at its core, anywhere the general public is allowed (think restaurants, theaters, hospitals, and banks). Those who own, lease, and/or operate these places cannot exclude individuals with disabilities and their “service animals.” Contrary to popular belief, a service animal is narrowly defined to include only a dog (or miniature horse) trained to perform specific tasks for the benefit of its disabled owner and expressly excludes so-called “emotional support” animals or other trained animals (cats, snakes, gorillas) from its statutory protection.

The MSAL similarly prohibits places of public accommodation from excluding individuals with disabilities and their “dog guides.” Though the MSAL is silent on what constitutes a dog guide, the statute is clear it is a dog that must accompany someone with a sensory and/or physical disability and not just provide emotional support or companionship.

This background is all well and good, but what does it mean for the lease you are currently negotiating? Well, for starters, if it is for a place of public accommodation, the lease cannot prohibit service animals or dog guides in the premises. For instance, a retail lease that prohibits all animals without exception would be in violation of both the ADA and MSAL. If enforced, the landlord and/or tenant could face civil penalties up to $75,000 under the ADA and up to $10,000 under the MSAL for the first violation.

A shrewd landlord may feel safe drafting a clause giving the tenant exclusive control over their premises and exclusive responsibility for ADA compliance. That must surely shield the landlord from liability if the tenant unlawfully prohibits a service animal from entering their premises, right? Not so fast. Though the ADA allows parties to allocate compliance obligations between themselves, both parties are jointly and severally liable for violations occurring in the tenant’s premises brought by a third party. The opposite though is not true. The landlord is solely responsible for ADA compliance outside the tenant’s controlled space; say in the lobby.

So, is the landlord completely out-of-luck when it comes to liability for a tenant violation? Of course not. A successful pet-friendly lease must include a broad indemnification provision that would indemnify the landlord for any claim arising from the tenant’s pets, including service animals and dog guides. This would ensure that the landlord could seek reimbursement from the tenant if the landlord is found liable for the tenant’s violation of the ADA and MSAL. The landlord

can further mitigate the possibility of an issue arising by requiring all animals be leashed, which will be important when discussing landlord’s remedies below.

One area where the landlord is prohibited from hedging their liability through upfront payments is the security deposit. Though landlords may want to consider increasing the security deposit amount for pets generally in order to cover unforeseen circumstances such as bankruptcy or damage to property, both the ADA and MSAL prohibit landlords from requiring individuals with disabilities to pay a surcharge for their service animal. This does not mean that a disabled individual is not liable for the damage their service animal causes if the landlord requires all tenants to reimburse them for tenant-caused damage, it just means that landlords cannot treat individuals with disabilities differently than those without service animals.

The lease allows dogs in accordance with applicable law, check. It contains appropriate indemnification language, check. It does not charge additional fees, check. What is a landlord or tenant to do if someone waltzes in with no visible disability and their dog is yipping and nipping at everything in sight? The ADA has you covered.

If the dog’s task and individual’s disability are not apparent, then either party may ask the individual two questions: (i) “if the animal is required because of a disability” and (ii) “what work or task the animal has been trained to perform.” If the individual answers appropriately, the questioner must take them at their word and cannot require documentary proof that the dog is required or is trained.

If the dog continues to yip and nip, the ADA does allow either party to ask the individual to remove the dog if it is: (i) “not housebroken” or (ii) “out of control and the animal’s handler does not take effective action to control it.” A dog is “under the control of its handler” if it is on a “harness, leash, or other tether.” If the individual’s disability makes a leash impossible, then the dog must be responsive to voice controls, signals, or other “effective means.” Remember, the lease should already require pets to be on leashes. Once the dog is removed, the individual must be allowed back into the premises without the dog.

While we have now discussed the basics of a successful pet policy and the implications of both the ADA and MSAL on our furry companions, we have only brushed the surface of the various legal issues that could arise while negotiating a pet-friendly lease. It is important to remember that other governmental statutes, rules, and regulations may apply.

(Daniel C. Johnston practices in the Real Estate Department at the Boston-based law firm Sherin and Lodgen LLP, where he provides clients with practical insights into development, permitting, leasing, acquisitions, and dispositions.)