Blue Dirt
Blue Dirt: Commercial Property Investing delivers expert insights and strategies for building and managing a successful commercial real estate portfolio. Whether you're a seasoned investor or just starting out, this podcast uncovers market trends, financing tips, and key investment principles to help you thrive in the industry.
Blue Dirt
Define Rent, Control The Case
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Missed rent isn’t a mystery; it’s a process problem. We pull back the curtain on how landlords actually win nonpayment cases—starting with crisp ledgers, strong lease language, and bulletproof notices that stand up in court. With attorney Tim Baldwin at the table, we map the route from the first late payment to possession, judgment, and real collections, showing where most owners slip and how to avoid the usual traps.
We start with the foundation: define what counts as rent. When your lease clearly includes CAM, insurance, late fees, and management in rent, your pay-or-quit notice carries real teeth and your numbers flow straight into the court registry. Pair that with property management software that mirrors the lease—rent escalations, grace periods, late fees, NSF fees—and your ledger becomes evidence, not an argument. If you’re self-managing with spreadsheets or a generic accounting tool, we outline the missteps that derail cases and the setup that fixes them.
From there, we walk through the decision tree. File eviction-only to move fast on possession, or bundle damages if it fits your strategy. Understand how Florida’s mailbox rule changes notice timing and why email notice clauses save days and headaches. Learn why the classic tenant defense—“the AC is broken”—often fails when the lease assigns HVAC maintenance to the tenant and no timely cure notice was delivered. For vacate-and-owe situations, we break down damages actions, default pathways, and the hearing needed to prove amounts.
Getting a judgment is only halftime. We explain how to use personal guaranties, compel fact information sheets, and target bank accounts, wages, and property with liens and garnishments. We also cover when a payment plan makes sense, when it doesn’t, and why you rarely release a guarantor without concrete value. Expect practical timelines: 30-day evictions in many Florida counties, weeks to a few months for uncontested damages, and up to a year for contested civil cases.
If you’re serious about protecting NOI and building durable value, let your documents and systems do the heavy lifting. Subscribe, share this with a landlord who needs a cleaner playbook, and drop your toughest tenant excuse—let’s pressure-test it together.
Learn more about Blue Commercial Properties on our website.
Welcome to Blue Dirt, the podcast that digs deep into the foundation of commercial real estate investing. Unlike most real estate shows that focus on deal making and market trends, Blue Dirt gets into the nuts and bolts of what truly builds long-term value, the building itself. We break down how to spot deferred maintenance before it costs you, why a solid preventative maintenance program is a game changer, and how triple net leases can maximize your investment returns. We'll also explore the importance of strong landlord-tenant relationships and how they drive stability and growth in your portfolio. Whether you're a seasoned investor or just getting started, Blue Dirt gives you the practical knowledge to make smarter, more profitable decisions in commercial real estate. It's time to get your hands dirty and build value from the ground up. Let's dig in. Welcome to this episode of the Blue Dirt Podcast, where even idiots can make a killing in commercial real estate. I'm Michael Caro.
Don Redhead:I'm Don Redhead with Blue Commercial Properties.
Tim Baldwin:And I'm Tim Baldwin with Property Management Law Solutions, a law firm in Pensacola.
Michael Carro:Fantastic. All right, so uh today we're gonna be talking about uh what Tim does to help landlords. You just help landlords? Yep, landlords. To help landlords um take care of unruly tenants that choose to do really bad things like not pay their rent.
Don Redhead:You don't represent tenants, too? No. Interesting. That's good though. I like that. It is good because we had a tenant home before. Yes, we did. We have many hosts.
Michael Carro:Oh, right. Well, there's not a lot of people that do what he does. So they're probably like property management attorneys. So this is episode two. Uh we we've we uh had episode one with Tim previously where we talked about leases. So if you if you're listening to this before that, that might be a great end intro to this uh episode. Today we're gonna talk about uh enforcement activities and the things that Tim has to do to try to get uh compliance with these tenants. So um where would you like to start, Tim? What'd be a good place?
Tim Baldwin:Well, as you said, non-payment of rent. That's sort of the the most common uh violation that we see. So we're gonna start there.
Michael Carro:Great. So um, so you got a lease in place, you got a tenant that they have missed rent. Um, and Don, who's the property manager, has done a great job of communicating with them, and they just they're either stiff arming them or they're being really nice and still not paying. But either way, the landlord got to the point where they're like, I've had enough, go after them. What's the process?
Tim Baldwin:Well, we need accurate records of what is owed by this tenant. And these ledgers need to be detailed, you know, but like the triple net lease, you know, has all the fees, all the late fees, uh, camp fees, uh insurance, whatever is charged need to be detailed, date, item, charge, unpaid. What is the balance? The balance is going to be running, of course. So that has to be accurate. Um, also, if you're charging uh interest, like uh we, you know, if you charge pre-judgment interest on unpaid uh rent, um, you know, though that calculation needs to be accurate.
Michael Carro:Yeah, and that's a tough calculation. So obviously you have people like Don with Blue Commercial Property Management, that they have a system that really does a good job at calculating all that. But but outside of a property manager, when a private individual who has a property comes to you, how clean are their books compared to, let's say, a property manager?
Tim Baldwin:Normally it's it's a nightmare. I mean, I'll be honest with you. I mean, we have most of the time we have to completely recreate the document. We we have to have them, hey, look, give us what, because we can't make sense of this. We don't even know what it is we're looking at hardly. So that is a uh a major problem with with what I call self-managing landlords.
Michael Carro:So if you have a self-managing landlord, I would think most of them would use QuickBooks.
Tim Baldwin:Yeah. And that's common.
Michael Carro:And QuickBooks is not necessarily designed to be a landlord tenant bookkeeping system. Right. But it but it can do certain things. When you get when you find somebody that it is at least is using that type of system, how is it in that case?
Tim Baldwin:Well, it's it could be better rather than just say an Excel spreadsheet that they just kind of create on their own whim. Uh, but you still have to set up the program correctly. And I'm not a bookkeeper, so please don't take this as an expertise of mine, but I do know what I'm looking at. Does it make sense? Can I make would a judge be able to look at this and know exactly how much rent is owed? And so if it's not set up properly, whether it's designated as designating it properly by the terms of the lease can be a big problem. Uh, in addition to that, like what I see commonly is putting in charges that may or may not be considered rent. Right. And so that skews the calculation. It actually may skew the balance, uh, the running balance as well.
Michael Carro:So, Don, from a property management perspective, you have a software system that when you onboard, so when they get a new tenant, the property manager will go through the lease and onboard that lease into the system with all the terms that Tim said, the rent, when the rent increases, pass through expenses, what are they? What's the allocation, maybe on a percentage basis if it's a multi-tenant building? And then it also calculates it, it you onboard, hey, what's the interest rate for payments that are 30 days old? What's the uh um late fee penalty if they're passed not only the due date, but sometimes there's this five-day or 10-day grace period, even though Tim mentioned earlier that it's three days is required. But let's just say a five-day grace period, you know, what's the percentage? So when that's onboarded into your system, then what happens?
Don Redhead:Do all those things. That's what you do. I mean, the the benefit of the property management software is it truly automates a lot of that to really remove, I won't say as much, right? Because it's it's bad inputs, right? Bad outputs. But as long as all the inputs are accurate, are correct, it it kind of runs itself, right? I mean, if they don't see a rent payment come in and applied to an invoice, it will automatically do those in those late fees, right? Or whatever the percentages of late fees and the NSF fees, right? If they give us a bad check. Because typically it's you're seeing all those different actions happen simultaneously. They're writing bad checks, or they're not paying on time. It's it's a compounding effect. And if you have it all set up properly, then it really runs itself. The increases take effect without you having to go back in and look at the clause in the lease and say, hey, on the third anniversary, it's this percentage.
Michael Carro:And and landlords, you know, uh, depending on the lease that you have, in all of our leases, the property management fees are included as a tenant expense. So the nice thing is, is as a landlord, I'm not paying for this fee. The tenants, it's part of their triple net, their pass-through expenses, but it's meant to be really good solid accounting. So you might want to consider using a professional property manager for your properties so you don't have to go through this struggle.
Tim Baldwin:Yeah. Well, I mean, the record keeping is just so vitally important. Again, when you're talking about going to the court, because one of the requirements, whenever a tenant doesn't pay rent, we follow an eviction, is that they have to deposit all the past due rent into the court registry and the accrued rent. So when we file these evictions, we have the rent ledger showing the court exactly in the tenant, of course, um, how much they owe. So if the tenant were to contest the case in some way, it's much easier for the court just to make the determination, five-minute hearing, 10-minute hearing, whatever the case may be, they've got to pay that amount today.
Michael Carro:So let's go through that process. The tenant didn't pay, the property manager reaches out to you, says, hey, listen, um they didn't pay. We want to move forward with some action. Talk about the various steps of the action to get to the court, to get to a judgment. Yep.
Tim Baldwin:Well, first step is you have to have a proper notice that demands them pay whatever the back rent is owed. And this is very important to know here that your lease has to define whatever the payment is as rent. So if you define everything, again, as they as you just mentioned, everything they owe is rent, then you include everything. But if there's some items that are not deemed rent, then you cannot include those in a notice to pay. That notice to pay has to be legally sufficient. So that's the first thing. If it is and they haven't paid within the three-day or whatever the notice period is uh that your lease requires, then that means you can then file the eviction. Now, the the question becomes many times is do I file my eviction action uh at the same time as damages? You don't have to, but you can. Okay. Uh there is somewhat of an advantage of filing evictions alone, and that is that's all you're dealing with is possession of the property. So that's an advantage. The disadvantage is now you got to uh file a separate action for damages. So, but once it's filed, they have five days uh to file an answer. And if they do, and many times it's probably in the form of, hey, that's not the correct amount, or there's a reason why I didn't pay rent, then we will ask the court to set this for a hearing to him for him to or her to order the tenant to pay all the back due rent into the court registry. That's what the court will do.
Michael Carro:So it doesn't go to the landlord. So in the event that the judge rules in favor of the tenant, that money is not sitting with the landlord, then the the uh court can simply refund that money as they deem appropriate.
Tim Baldwin:Yeah. So when the tenant deposits that back due rent into the court registry, the court can then order that that money be dispersed to the landlord, even during the dependency of the action. Okay. For that matter, you don't necessarily have to wait to the end of the eviction.
Michael Carro:Gotcha. Okay.
Tim Baldwin:Yeah, so from there, I was just finishing out the process. If they don't deposit rent or they default in some way, you get your judgment, get your writ of possession, sheriff goes out there and removes them. Um, but if there's contested issues, they deposited all the back due rent and the accrued rent during the case, then you go through your litigation as you normally would. Uh, upon prevailing, same results. Get your writ of possession, get all the money that was deposited into the registry to you.
Michael Carro:So let's assume that uh the tenant has already vacated, but they still owe you all this money. Is it the same process?
Tim Baldwin:No, different process. Uh damages actions are under the general civil rules of procedure. So they have 20 days to file an answer. Uh they can contest.
Michael Carro:So not five. So five is is when you want to get them out of the property. Correct. 20 is whatever you just said.
Tim Baldwin:Yep, damages action. So uh 20 days, if they file an answer, then it's in contested litigation. So there's a case management conference, uh, scheduling order, all that kind of thing. You go through the process.
Michael Carro:Okay.
Tim Baldwin:Um, if they default, then you get a default judgment. And then you have to go to a hearing to actually prove the specific amount of the damages that they owe you, get a final judgment for that amount. And then at that point, you can try to seek collections to some degree or to an extent you can.
Michael Carro:Okay. So uh you are working a case for us, and we won't say the name, but you're working a case for us right now where we have uh a tenant with two personal guarantors, and they uh one of the guarantors is willing to enter into a payment schedule, but wants the other guarantor released, and which of course would put the landlord in a lesser position, especially since up to this point that tenant uh or that first tenant or guarantor has not shown any propensity to pay these. Yeah. So walk us through the process from here going forward. So you have you already got a judgment? Yes. So you already got a judgment. So they already owe the money. Yeah. So what's the advantage of trying to? I mean, what's how do we get the money?
Tim Baldwin:Yeah. Well, there's uh several ways. One is through some sort of agreement. I mean, it's not a really agreement, it's just their willingness to pay off the judgment, right? Um, sometimes that happens. Some and more than not.
Michael Carro:Everybody says they're willing until they don't.
Tim Baldwin:Until they don't. But to your point of like the personal guarantor guarantor, um, is there any good reason to release them from the judgment? No. Because you're just throwing away an opportunity to collect on that money. So that's a general rule. Um, so but if they're they if they don't pay, then you have to go through collection. So once you get a judgment, you can send it to a debt collector uh and they can attempt to do their thing. Uh, whether that works, of course, they charge you know at least 50% typically for going after that money. Or you can go through sort of the more, you know, the lawyer route. So the lawyers can uh get all of the information they have about that person's financial uh wherewithal, their assets, their liabilities, where is it all? What is it? Once you get that, then you begin to see, well, what can we attach liens to? Okay, can we garnish wages and and that process? That's sort of a whole separate process from the uh damages action case itself.
Michael Carro:And so in in that particular case, I mean, what would you recommend?
Tim Baldwin:Well, you we have to look at the financial assets and liabilities of the individuals involved.
Michael Carro:Uh if the company And is that is that forthcoming or is is there a way to because I presume that the tenants don't want to just willy-nilly give it to you.
Tim Baldwin:Right, they're ordered by the court, they're ordered by the court to do that. So that's part of when we get a final judgment and say, Judge, we need this tenant uh or defendant to provide us what we call a fact information sheet. Okay. The fact information sheet has all of the information that they're supposed to give bank accounts, properties, cars, whatever. Okay. And so, and then once you get that, then you can see, well, we can attach a lien here, we can uh garnish wages because they have enough income here. And that's how you begin to see what you can get.
Michael Carro:I got you. Okay. And in this particular case, where are you at with that? Uh we are you at that point?
Tim Baldwin:I um off the top of my head, I believe so. I believe we've already got the final judgment, but we haven't, we're not in the process or the time, the deadline hasn't expired yet for to get the fact information.
Michael Carro:And so from start to finish, when the tenant, when when Don says, hey, listen, Tim, we want you to uh go uh uh work this angle um from the from the when they're in the building and you want them out till to the eviction, to the collection. And in this case, when they're out of the building to just collect the money to the end, how many weeks, months, years are we talking?
Tim Baldwin:Well, for evictions only, uh typically we're pretty quick. Our firm is pretty quick. So 30 days is not unusual for us to start it and finish it.
Michael Carro:And and they're out. And they're out. So in the state, and that's a state of Florida thing. Florida, Florida's pretty fast about uh evictions.
Tim Baldwin:Well, uh depending on the county, but but a lot of counties are pretty good at it. Some counties not as good as others, but in Escambia County, we're pretty good. Okay. Uh so that's that that's that part of it. So the damages actions themselves, though, it depends on if they answer or contest the case or not. If they don't, it's a similar sort of process. We can get a final judgment really shortly after they defaulted on the case. Uh, and then uh from that point, it's just getting it set for a hearing in front of the judge to prove up the damages uh amount, the amount themselves. So that could take, depending on the judge's schedule, it could be a month down the road, could be two months down the road. So you're looking at somewhere between like 45 days to three months to four months. Uh a little bit wider range, but that's pretty normal. If they contest, and again, they've deposited the money into the court registry, if they're still there, then um then it's a typical general civil litigation case, it could be a year. Um they resolve before that through settlement of some kind. Um, but the court has again a case scheduling order, and you've got to follow that order. It could be up to a year. Right. Yeah.
Michael Carro:What you got?
Don Redhead:I got enough. Good to see you. Just letting you guys run. We're running a marathon. That's I'm trying to think of one that we've worked on. Um it seems like the biggest thing that we get is is where individuals are, I don't want to say contesting the rent, but they're they're complaining about their kind of go-to is is issues with the space.
Tim Baldwin:Yeah, oh man, that's a good one. That's that's I mean, that is the that's the card that they play every time. Absolutely. Yeah. So you've done you've reached the agreement in some way. So you didn't repair this, or it wasn't in the condition you said it was in, or the AC is not working, all those things. So again, going back to the part one of our episode of the show, uh, we talked about why the lease is so important. And this is one of the reasons why the lease provisions are so important is to stop the tenant from alleging that these things are, first of all, our responsibility. HVAC uh maintenance is your responsibility, is clearly in the lease. So when they complain about that, you say, Look, it's clear that you're responsible for the HVAC. So uh you can't withhold rent or or whatever. Um, now the tenants do have the ability to give you notice that you are in breach or your material violation of your obligations for maintenance, but they have to give you a seven-day notice to cure and they have to specify what it is that you're in breach of and give you that opportunity to cure. So that if they haven't done that, then they're foreclosed from even raising that as a defense in their case.
Michael Carro:And that's what we get all the time. Um, but it's usually once Don puts them in default. Correct. It's a reaction. What you know, and so and and and and and their position would be absolutely fair, you know, if there really was it, but it's usually not. It's usually a uh uh just a response because they didn't fulfill their obligations.
Don Redhead:So you're saying that because it's a reaction to it, it's it's I don't want to say null and void, but essentially not relevant.
Tim Baldwin:Yeah. So if you if you uh delivered a notice to pay, and then after you delivered a notice of pay, they then give you a notice to cure your whatever alleged default is. Most courts view that as uh non-effective as a defense to the eviction because they say if you think you have this uh cause not to pay rent, you've got to do it before they give you a notice to pay. So if you're the first one to give the notice, you're better, you're much better off. Uh and the tenant not so much.
Michael Carro:Land the plane. Land the plane. No, that's that's that's extremely beneficial um to know that. So as a landlord, just be diligent with your tenants um and uh make sure that you have a process to provide notification. We talked about earlier that uh if your lease allows you uh uh to send emails, that's great. Check your leases out to make sure that they don't have the old stuff of certified or return receipt, all that other jazz.
Tim Baldwin:Can I say something? If you because in Florida, if you mail a notice, you have to add five additional days to the notice period. It's a the mailbox rule. So a lot of landlords don't know that. So when they calculate their notice to pay date in the in the notice, it's incorrect. Okay. But they didn't do a five day. And also there's other, well, there's other issues like if you're out of state or their mailing address is somewhere else other than the local area, these big corporate more big corporate issues, there's all kinds of issues like that. So you're exactly right. If you have an email notice um provision in your lease, that's a much better option. Yeah.
Michael Carro:Well, Tim, thank you so much. That wraps up another episode of the Blue Dirt Podcast, where even idiots like Don and myself can make a killing in commercial real estate. That's a wrap for this episode of Blue Dirt. We're here to help you build smarter, invest wiser, and create long-term value in commercial real estate. One solid foundation at a time. If you found today's insights useful, be sure to subscribe so you never miss an episode. And if you know somebody who could benefit from these discussions, share Blue Dirt with them. Got questions or topics you'd like us to cover? Reach out. We'd love to hear from you. Until next time, keep digging deep. Stay sharp, and remember real value is built from the ground up. See you on the next episode.
