My tenants of two years just signed a lease but now want to terminate before new lease takes effect

Full Question:

I am a landlord for a house in Portland, OR. I have a tenant that has occupied the house for 2 years, signing and renewing a 1-year lease agreement. We agreed to do a 6-month addition and I received a signed agreement. Now they want to cancel. The new lease was not set to take effect until June 16. What are my options?
05/26/2009   |   Category: Landlord Ten... ยป Lease Termin...   |   State: Oregon   |   #16783


Courts have held that a party may rescind a contract for fraud, incapacity, duress, undue influence, material breach in performance of a promise, or mistake, among other grounds. In order to prove a fraud claim, it must be shown that the defendant had an intent to deceive. If deception was used to induce another to rely on a promise and such reliance caused harm, it is possible to recover damages. Fraud may be made by an omission or purposeful failure to state material facts, which nondisclosure makes other statements misleading.

Without fault on the landlord's part, and if the lease terms don't allow for early termination, a tenant may be liable for the term of the lease. If a tenant breaches a lease by early termination, the landlord may bring a civil action to recover damages. However, the landlord has a duty to mitigate (lessen) damages by making a reasonable attempt to relet the premises. If a new tenant is found, the rent received from the new tenant must be deducted from the damages claimed by the landlord.

The folliwing is an OR statute:

90.430 Claims for possession, rent, damages after termination of
rental agreement.

If the rental agreement is terminated, the landlord may have a claim for
possession and for rent and a separate claim for actual damages for breach
of the rental agreement.

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