Pot and rental properties: What landlords and property managers should know

Marijuana, Money, Real estate, Rights

This article originally appeared on the Zillow For Pros Blog.

The movement to legalize medical and recreational marijuana is gaining speed across the country, with four states and the District of Columbia approving recreational marijuana use and 23 states and the District allowing medical marijuana use. What does this mean for residential property owners and landlords? We spoke with Avvo attorney Bret Sachter about pot use in rental properties.

Q: Which states allow individuals to smoke marijuana or consume marijuana products in private homes?

Sachter: Presently, adults over the age of 21 can use recreational marijuana at home in Washington and Colorado. And recreational marijuana use will be legal in Alaska starting Feb. 24, 2015, in Washington, D.C. starting Feb. 25, 2015, and in Oregon starting July 1, 2015.

In addition, 23 states, plus Washington, D.C., have legalized medical marijuana for qualifying patients. Those states are Alaska, Arizona, California, Colorado, Connecticut, Delaware, Hawaii, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Montana, Nevada, New Hampshire, New Jersey, New Mexico, New York, Oregon, Rhode Island and Vermont.*

However, it is important to note that each state’s laws on medical marijuana differ, so property owners should look into the specifics of their state’s laws.

Q: Which states allow individuals to grow marijuana for personal use? 

Sachter: Under the states’ respective recreational marijuana laws, adults over the age of 21 can grow a limited number of plants in Colorado; similar rules will apply in Oregon and Alaska when new laws take effect. Recreational marijuana users in Washington are not currently allowed to grow their own plants, but there is a chance that new legislation will change this in 2015.

Medical marijuana users are allowed to grow their own plants, with limitations specific to each state, in the following states: Alaska, Arizona, California, Colorado, Hawaii, Maine, Michigan, Montana, Nevada, New Mexico, Oregon, Rhode Island and Vermont.*

Q: Can a landlord prohibit medical or recreational marijuana users from growing their own plants in a rental home or on the property?

Sachter: In a state that allows either medical or recreational marijuana to be grown in private residences, a landlord can prohibit renters from growing pot by including the rule as a clause in the lease. If the issue comes up after the lease has been signed without such a clause, the landlord would likely need to rely on an anti-drug or crime policy that hopefully was included in the lease.

The landlord would then need to send written notice of the lease breach, citing the appropriate clause. If the renter continues to grow plants after receiving the written notice, the landlord may attempt to evict the tenant.

If no such clause exists, the landlord may have difficulty preventing renters from legally growing marijuana during the term of the lease.  

Q: If I own or manage a residential building, can I refuse to allow tenants to smoke marijuana? 

Sachter: Yes. Just as you are allowed to prohibit cigarette or cigar smoking, you can also prohibit marijuana smoking.

Q: Should I put marijuana rules in my leases? Any suggestions? 

Sachter: Whether you should prohibit marijuana use completely or allow it in certain forms (e.g., smoking versus edibles or concentrates) is up to you and is a decision that should be made with an understanding of local marijuana laws.

Even in states that allow the consumption of marijuana, smoke or other perceived negative aspects of marijuana use could certainly impact neighbors or other tenants. On the other hand, there is growing evidence of the marketability of openly allowing marijuana use. For example, there are hotels and bed and breakfasts in Washington that use their friendly attitude toward marijuana as a selling point, and this strategy appears to be paying off for some.

However, if you do choose to prohibit marijuana use to some degree, it is always best to make it clear in the lease. I have seen leases in Washington that prohibit smoking and specify that this prohibition applies equally to cigarettes, cigars, marijuana and all other types of smoke.

Furthermore, as marijuana is still illegal under federal law, you can include a clause prohibiting conduct that is unlawful under state and federal law.

Q: What do I say if a tenant complains that marijuana is now legal and they should be allowed to smoke?

Sachter: As with many legal questions, the answer depends on the situation. If your lease prohibits smoking or has an anti-crime or drug clause, the legality of marijuana use on a state level is irrelevant; you should be able to enforce the lease and prohibit smoking in the unit.

If the lease does not have those types of clauses, and you wish to prevent the tenant from smoking marijuana, you should talk to an attorney familiar with your state and municipality landlord-tenant laws about the lease in question to find the best solution.

Q: Can I evict someone for smoking marijuana or disturbing neighbors with smoke?

Sachter: If the residence is in a state where marijuana is legal in some form, it may be difficult to evict a tenant after a single violation. Allowing the tenant to remedy the situation first would likely be the most successful course of action.

If the problem continues, and if multiple violations or constant complaints from neighbors are documented, it may be possible to evict the tenant.

Q: Will my standard insurance policy or a tenant’s renters insurance policy cover damages caused by pot smoking? 

Sachter: Generally, insurance companies do not have to cover damage caused by illegal activities. If you live in a state with marijuana legalized in some form, it is important to contact the insurance company in question to ask if they would cover such damage or decline coverage based on the federal illegality of marijuana.

* Washington is not included in the medical marijuana lists because in 2014, the Washington State Court of Appeals held that medical marijuana is illegal in Washington. Although there are medical marijuana laws in Washington, they do not offer protection from arrest and prosecution. The Washington Supreme Court said in October 2014 that it would review the case.