I asked my friend Jennifer Mossack to write a series of articles that explain some of the difference in the law in Panama. This is the first in a series by a lawyer licensed both in Panama and Massachusetts.
Many people who move to Panama and either invest in real estate for rentals or come to rent are unaware the Landlord tenant laws in Panama are uniquely Panamanian. Regardless of where you are from, the laws here are different. This makes for many problems, losses and occasional disasters due to ignorance of the law for both landlords and tenants. Understandably, it can become confusing as to what is really the law and how it might affect you.
Whether you are a Landlord or a Tenant, there are many stipulations that you should be certain are included within your contract in order to protect your legal rights. Oftentimes, we tend to want to forge ahead and just sign our rental agreement because we have so many other things on our minds and we want to move fast! You should remember that skipping and/or skimping on legal advice can cost you a lot of money at the end of the day.
Frequently, we encounter clients for whom we must remedy situations where they have not sought the proper legal counsel. Whether you are renting or a rentee – take a few days to make sure the contract you are drafting or signing protects you.
We always try to see things from a client perspective and think – what would we want or need to know about rental contracts in the Republic of Panama?
So, we have put together a list to get you thinking about what you should probably research through a qualified Panamanian attorney:
For the Landlord:
- How do I protect myself from my tenants leaving my place in poor condition at the end of the rental period?
- How much can I legally charge my tenant in fines if they pay the rent past the due date stipulated in our contract?
- What do I do if the neighboring units or house complain about my tenant’s behavior (e.g. loud noise, drinking etc.)?
- Do I have to pay tax on my income and if applicable, how do I do this?
- What if my Tenant becomes problematic and I want to evict them? How does this work?
- How often can I check on my house or apartment to make sure my tenant is keeping it in good condition?
- What are my obligations as a Landlord under Panamanian Law?
- Do I really have to register my contract with the Ministry of Housing?
For the Tenant:
- What happens if my contract period runs out and I do not receive a renewal? Does it automatically renew itself?
- If I pay late, what kind of charges can my landlord legally request?
- When I make improvements in the apartment/unit/house I am renting – can my landlord increase the rent on me? Am I entitled to restitution for these improvements once I vacate?
- If my landlord won’t return my security deposit, is there anything I can do?
- If I want to terminate my rental contract, how much notice should I give my landlord and do I owe the remainder of the rental contract money?
- Do I have any recourse if my landlord enters my apartment/unit/house without any notice?
- If I am suddenly faced with an eviction notice that I cannot make heads or tails of – what can I do?
- If my apartment/unit/house should flood – is my landlord obligated to pay?
- What can I do if my neighbor frequently makes too much noise?
This list is certainly not exhaustive and there are many ways that you can draft a clear contract to protect your rights and clearly define your obligations – whether you own the place or rent it.
Feel free to contact our law firm with your enquiries on this topic.
-By Jennifer Mossack
Licensed to practice law in Massachusetts and the Republic of Panama
Senior Partner at Mossack Darlington & Asociados
You can email for a consulting advice at Jennifer Mossack