My father who lives in Yerushalaim became ill recently. In order to visit on Shabbos, I agreed to rent an apartment in a nearby neighborhood but there was only an oral agreement. On Wednesday my father’s condition worsened and he had to be hospitalized and they also diagnosed him with Covid. Since we could no longer visit him on Shabbos, we decided to rent a larger apartment in a different neighborhood to enable us to be together with many more family members. When we called to cancel, the owner told me he had turned down a number of offers because he had rented to us. In the end, he didn’t find another renter. Must I pay him since I had originally agreed to rent the apartment and caused him a loss?
As usual, we must first consider the halachic interpretation of your question.
The Gemoro says (Bava Kama 79A) that one legally acquires an immovable object, such as an apartment, as a rental (not a purchase), by performing one of the following three actions: giving kesef (paying), shtar (signing a contract) or chazoko (moving in). You did none of these. Therefore, at first glance it would seem that you can cancel your agreement. This would be the end of the story from a monetary point of view if the owner did not suffer any loss. However, since you believe him that he did suffer a loss, we have to determine whether you have any responsibility for his loss.
There is no Gemoro that deals directly with your question. Even the Rishonim and Shulchan Aruch only discuss this essential issue in the context of employment agreements but not of rental agreements. However, we have seen that in many ways these two kinds of agreements are very similar since when one employs a worker he is essentially renting him to perform a job. It is just that an employee provides a different type of service than a rented facility. We will therefore study what has been written about employment agreements and we will at the same time carefully consider whether one can apply those findings to property rentals.
We will also need to investigate if even today the situation remains as in the time of the Gemoro and Shulchan Aruch, that verbal agreements do not have the status of a kinyan. Finally, since the ruling depends also on the reason for canceling the agreement we will also discuss how to classify the reason for your cancellation. In this part of the article we will only deal with the first issue.
The Gemoro (Bava Metsiyo 76B) writes that only if the worker actually began working, is the employer liable to pay the worker whose employment was canceled by the employer. The reason beginning to work is so crucial is that beginning to work constitutes an act that carries the weight of a kinyan, a legal action that binds both parties to their agreement. It obligates both the employee to work and the employer to pay his employee. However, if the employer canceled the employment agreement before the employee began working or performed any other formal act to obligate the employer to engage his services, the employer may cancel their agreement without incurring any liability. We will now study three approaches among the Rishonim concerning the question of whether the employer really bears no liability. Note that this is exactly your question translated to the context of employment agreements.
Tosafos (ibid) and the Rosh (BM 6, 2) ask that even though the employer isn’t liable to pay the employee any wages if he fired him at this stage, nevertheless, he should be liable for damages since he caused the employee to pass up other employment opportunities, a causative damage that falls into the category of garmi? They answer that the premise of the question is essentially correct. The employer would be liable as one is liable for any garmi just that the Gemoro was discussing a situation where there were no causative damages. We should note that if the employer is liable for the loss he caused to his employee because it is classified as garmi then the damage you caused the owner would also be considered garmi and you would be liable because in both cases cancellation by the purchaser of the services caused the provider of services a loss of income.
However, both the Ketsos (note 2) and Nesivos (note 3) claim to have proof that this damage does not fall into the category of garmi since the employee did not suffer an actual loss but only a loss of potential income. The Ketsos goes so far as to rule against the Shulchan Aruchm to say that the employer is not liable. However, the consensus of poskim is against the Ketsos. (So ruled the Tehillo Ledovid siman 333 and that is the consensus of contemporary poskim and thus one cannot even claim kim li like the Ketsos.) However, many agree with the Ketsos to the extent that garmi applies only if one caused a loss and not just a loss of income. They disagree with him in practice in the case at hand because they find other reasons to require the employer to pay.
However, there are others such as the Ohel Moshe (res. 2, 52) and Nefesh Chayo (BM 76B) who disagree with the Ketsos and Nesivos and maintain that the understanding of Tosafos and the Rosh that the employer’s action constitutes garmi is correct since the income was certain. They maintain that even being a cause of a loss of income is included in garmi if the income is certain. According to them, one who canceled a rental agreement is liable if there was another renter, as in your situation, since the loss was certain.
The Nemukei Yosef (BM 46A) and Rashbo (BM 76B) have a second approach. They agree that the employer is liable if he canceled in the manner described above, just that rather than attribute the liability to the general class of damages known as garmi, they say that the reason is that employers and employees have mutual liability for dovor ho’oveid-a monetary loss that one may cause the other. It is not clear from these Rishonim what is the source for and the nature of this mutual liability for dovor ho’oveid.
While the Tur (siman 333) writes that the reason the employer is liable is due to garmi, the Shulchan Aruch (333, 2) brings the reason of the Nemukei Yosef that the reason for the employer’s liability is because it is a dovor ho’oveid. However, the Sema (note 8) explains that the Shulchan Aruch means garmi. Thus, the Sema seems to have understood that this mutual liability falls into the general category of garmi and the Nemukei Yosef and Tosafos are actually the same opinion. However, many commentaries (R. Akiva Eiger 333, 2), Ketsos, Nesivos, Gra) comment that this is quite strained since if the Rishonim and Shulchan Aruch mean garmi there is no need to connect the employee’s loss of income with the employer’s loss in case the worker quits. Thus, we have to understand the new concept of mutual liability for dovor ho’oveid and see if it applies equally to property rentals.
The Nesivos understands that the mutual liability is a Rabbinic institution governing employer-employee contracts. He explains that since normal principles do not suffice to create liability, a special Rabbinic edict was required. He even claims that when Tosafos and the Rosh called the damages garmi they meant that it was a special edict and there is no real disagreement between Tosafos and the Nemukei Yosef and no one really means ordinary garmi. However, this is quite difficult and it seems far more plausible (and this is implied by R Akiva Eiger and the Gra) that these are two distinct approaches.
The Ritva (73B and 75B) understands that when an employer and employee enter into an employment agreement, since the basis for the agreement is mutual trust, therefore to bolster each one’s confidence that the agreement will be carried out, they obligate their assets as if they were cosigners (areivim) on their mutual obligations. The Chazon Ish (Bava Kama 23, 36) and Kehillas Yakov (BM 38) understand that this is a full-fledged Biblical liability like any other monetary obligation and this is the source for the liability that the Nemukei Yosef and Rashbo speak about. It should be noted that even though the approach of the Chazon Ish and Kehillas Yakov may very well be correct in their interpretation of the Nemukei Yosef, since the Nemukei Yosef often follows the approach of the Ritva, it is problematic halachically since most poskim (See Ramo (333, 6) and the Nesivos thereon (333, 14))) disagree with at least part of the Ritva and maintain that the employee has no monetary liability if he does not fulfill his commitment.
However, the Ketsos (333,3) says that we can understand this mutual liability even if we do not maintain that the employee has monetary liability. He explains that the mutual relationship is that each accepts a penalty that is related to his role in their agreement. For the employer it is a monetary liability since his role in an employment agreement is to pay the employee. But for the employee it is a penalty that will coerce him into working since that is his responsibility as a result of the employment agreement.
The Erech Shai (312, 14) also understands that the Ritva serves as the basis for the mutual employer-employee liability in case either causes the other a loss. He specifically states that this agreement applies to property rentals as well. He also understands that this is the intention of the Nesivos. The Mishpat Shalom (176, 14) also agrees that based on the Ritva a renter who causes a loss to the property owner is liable for the owner’s loss.
Thus, many maintain that those who follow the second approach maintain that one who backs out of a property rental is liable monetarily even though there was no kinyan.
There is a third approach that is taken by the Mordechai (Bava Kama 115). He explains that when one obligates himself to pay for a good or service he not only obligates himself to pay if he receives what he paid for, but also in case he changed his mind and caused the other party to lose. He specifically applies this to rentals and says that when one agrees to rent something he is agreeing to pay both if he uses the rental or does not use the rental but the owner was not able to rent to another person. This approach is ruled by the Erech Shai (333, 1), the Ulam Hamishpot (310, 3) and the Malbushei Yom Tov (res. CM 7). Therefore, following this approach as well, you are liable after canceling your rental.
We should mention that there is a fourth approach that was suggested by the Ketsos and the Chazon Ish (Bava Kama 22, 1) and applies only to employees but not to property rental. This approach maintains that the employer is liable because the Torah made anyone liable if he damages a worker so that he cannot work (sheves). Similarly if one hires someone and then cancels in a manner that prevented the worker from working, he is liable since in essence he is like anyone who prevents someone from working. (The Ketsos only maintains that the Shulchan Aruch does not agree that one is liable even in case of employees and therefore he argues on the ruling of the Shulchan Aruch that one is liable to his employees.)
In conclusion: We have seen that very many poskim maintain that even if we hold that a verbal agreement does not constitute a formal act of kinyan, nevertheless, one who agrees even only verbally is liable for the damages he causes the owner. Thus you are liable for the losses of the landlord.
It is true that there are opinions that rule that you are not liable. However, there are two important points to consider. First, even if one is not liable in this world for damages that are only gromo (and not garmi), one is generally liable for such causative damages in the shomayim-the world to come. One certainly should pay in this world for these damages since otherwise he will be punished after death. Many, including Rav Zalman Nechemia Goldberg, maintain that beis din, nowadays, can force someone to pay for damages for which he is liable in the shomayim in the context of the shtar borerus.
Second, in the next part we will see that many maintain that today even a verbal commitment constitutes a kinyan. If this is correct then you are certainly liable to pay as a renter and not just for damages.