Residential Unlawful Detainer and Eviction Defense
Eleventh Edition
Updated June 9, 2009
Posted at http://www.povertylaw.homestead.com under Reading
By
Lawrence R. McDonough
Attorney at Law
Lawrence R. McDonough
Managing Attorney
Legal Aid Society of Minneapolis Housing Unit
Legal Aid Society of Minneapolis, Inc.
2929 4th Avenue South
Minneapolis, MN 55408
612-746-3646, Fax: 612-827-7890
http://povertylaw.homestead.com
Tenth Edition, March 2008
Thanks again to the attorneys, law students, advocates, legislators, judges, and referees who continue to assert and expand the law for the benefit of tenants. I especially wish to thank Drew Schaffer, whose analysis is reflected in much of the next text; John Freeman, for his technical support at www.projusticemn.org; and Alice Engstrom and Christa Lord, for word processing support.
Ninth Edition, March 2004
Thanks to the attorneys, law students, advocates, legislators, judges, and referees who continue to expand the law for the benefit of tenants. I especially wish to thank Paul Birnberg, whose analysis once again is reflected in many sections of this manual, and Sharon Elmore and Jaya Shoffner of the Minnesota Legal Services Coalition, who managed the placement of this manual, forms, and cases on www.projusticemn.org.
Eighth Edition, July 2000
I am grateful to Lila Talvitie-Zamora, who helped process the updates for this edition, and the attorneys and advocates who continue to expand the law for the benefit of tenants. I especially wish to thank Paul Birnberg, whose analysis is reflected in many sections of this manual, and Bricker Lavik and Candee Goodman, who first developed the idea of an annual housing law institute, for which I first prepared this manual. Finally, thanks to the Minnesota State Bar Association and Nancy Kleeman, Dorsey and Whitney, and Probono.net, for providing the encouragement and technical support to make this manual and the many unpublished decisions discussed in it available on the internet.
Seventh Edition, November 1996
I would like to thank Chris Nelson, who helped process this edition, and the attorneys and advocates who developed many creative arguments that resulted in the decisions reported here. As I put these materials together I can see the wonderful work all of you are doing to make life a little more just for tenants.
Sixth Edition, November 1995
I wish to thank and acknowledge the work of Peggy Armour, who spent many hours processing this edition; and the attorneys and advocates from legal services, volunteer attorney programs and other agencies, which provided important court decisions for these materials. I especially want to thank Paul Birnberg, Robin Williams, Charlene D'Cruz, and Doug Clark, who helped me develop some of the arguments and forms in these materials. Finally, I wish to dedicate this edition to Dawn Carlson, a legal services attorney in Moorhead, Minnesota, who recently passed away. While she was with Legal Services only for a few short years, her dedicated work benefitted her clients, the law, and those of us who knew her.
Fifth Edition, November 1994
The author again wishes to thank Kaylen Randle, who spent many hours processing this edition; and the attorneys and advocates from legal services, volunteer attorney programs and other agencies dedicated to the protection of tenants.
Fourth Edition, November 1993
The author wishes to thank Kaylen Randle, who had the thankless task of processing this edition from the previous edition, two supplements and additional material.
Third Edition, April 1991
This article is dedicated to all of the Legal Services and volunteer attorneys whose advocacy continues to expand legal protection for tenants. Many of the statutes and court decisions discussed in this article are a result of their work. The author also wishes to thank Mescal Urich, who again devoted countless hours to processing this continuously expanding article.
Second Edition, October 1989
The author wishes to thank Peter Brown, Richard Fuller, Bricker Lavik, Candace Rasmussen, Galen Robinson, Randall Smith, Timothy L. Thompson, Thomas Vasaly, and John Whitelaw, Esquires, whose written materials and/or comments formed the basis for portions of this article; and Mescal Urich, who devoted many hours to formatting and processing numerous drafts of this article.
Lawrence R. McDonough
Chapter I:
Introduction To Unlawful Detainer (Eviction) Actions
and Landlord-Tenant Relationships
1. Recodification of Landlord-Tenant Laws
3. Effect of Unpublished Court of Appeals Decisions
4. Preemption of Ordinances by State Statutes
B. Summary of Unlawful Detainer (Eviction) Actions and Court Procedure
C. Creation of a Landlord-Tenant Relationship.
2. Month-to-month and other periodic tenancies
8. Covenant running with the land
9. Covenants implied by statute
10. Lease renewal or extension
F. Manufactured (Mobile) Home Park Lot Tenancies
G. Public and Government Subsidized Housing Tenancies
H. Non Leasehold Relationships
3. Caretakers: tenants versus employees
Chapter II:
Summary Proceeding
A. Summary Proceeding to Replace Self-help Eviction
B. Action Not Appropriate for Certain Types of Litigation
1. Parallel or complex litigation
Chapter III:
Subject Matter Jurisdiction
Chapter IV:
Personal Jurisdiction
C. Third Party Practice and Joinder
D. Temporary Restraining Orders
1. Against tenant within eviction action
2. Against landlord to prevent filing of eviction action
G. Housing Court: Ramsey and Hennepin Counties
J. Exceptions to the Unauthorized Practice of Law (except for jury trials and appeals)
L. Summary Judgment and Dismissal
N. Collateral Estoppel and Res Judicata
O. Removal of Action to Federal Court
P. Release from Prison for Hearing
S. Consolidating the Eviction Action with Other Actions
T. Sealing or Expunging Court Records
U.Disbursement of Funds Paid Into Court
B. Limitations on questions of title or equitable defenses
1. In Municipal or County Court
3. Mortgage Foreclosure and Contract for Deed Cancellation
1. Requirements for personal jurisdiction
b. Service less than seven (7) days before the initial hearing
d. Service by a named plaintiff or agents
e. Substituted service on non-defendant defenses
f. Improper substitute service by mail and posting
h. Improper affidavit of service
j. Service before filing action
3. It is unclear whether defendants can be designated as "John" or "Jane Doe"
D. Failure to Satisfy Preconditions to Recovery of the Premises
1. The plaintiff is not entitled to possession
2. Landlord address disclosure
5. Tenant in possession for at least three years
6. Failure to state the facts that authorize recovery of the premises
a. Pleading compliance with statutory preconditions for the action
c. Litigating claims not raised in the complaint
7. Unauthorized practice of law
a. Management agents for plaintiff
c. Limited Partnerships and Limited Liability Companies
9. Failure to provide defendant with a copy of the lease before commencement of the action
13. Pending parallel litigation
14. Failure to join an indispensable party
15. Lack of jurisdiction over Indian trust property
16. Action is inappropriate method to resolve complex claims
18. Landlord's preparation of summons
19. Action or claim is premature
20. Plaintiff's voluntary dismissal
22. Filing case in violation of consumer fraud order
25. Failure to use written lease
31. Servicemembers Civil Relief Act
E. Nonpayment of rent defenses.
1. Breach of the covenants of habitability
b. The plaintiff must prove that rent was not paid
c. The defendant must tender the rent to be withheld or provide adequate security
(1) Reasonable repair and code compliance covenants
(2) Fit for use intended covenant: other conditions and conduct problems
(3) Housing code violations not concerning housing condition
(4) Disrepair caused by acts of nature or third parties
(5) Court inspection of the property
e. Is notice of violations required?
h. Public and Government Subsidized Housing
j. Companion tenant's remedies and rent escrow actions
k. Landlord's potential tort liability.
m. No assessment of costs against tenant
r. Housing inspection agency records
s. Studies of effects of inadequate housing conditions
u. Manufactured (mobile) home park lot tenancies
2. Other housing condition defenses
a. Violation of housing code precluding action for rent
b. Agency housing repair orders
3. Breach of an express covenant which creates a condition precedent to payment of rent
4. Tenant payment of utility or essential services following landlord's nonpayment
5. Previous lockout or wrongful exclusion or eviction
6. Taxes on the land paid by the tenant
7. Improper notice to increase rent or fees
8. Waiver of notice to increase rent
9. Retaliatory rent increase or services decrease
a. Liquidated damages and penalties
d. Public and subsidized housing
e. Manufactured (mobile) home park lot tenancies
f.No late fee is due because the tenant properly withheld rent
g.Plaintiff did not prove existence of late fees
11. Manufactured (mobile) home park lot tenancies
12. Public and government subsidized housing
a. Section 8 existing housing certificate and voucher programs
b. Subsidized housing projects
13. Waiver of rent due by accepting partial payment
14. Waiver of past rent due by accepting rent for later months
15. When and how much rent is due
b. No agreement on when the rent is due
c. Waiver of prompt payment of rent
17. Reasonable accommodation of disabilities
a. Tenant or landlord liability under the lease
b. Landlord liability with shared meters
c. Landlord termination of utilities
d. Tenant payment of utility or essential services following landlord's nonpayment
19. Combined actions for nonpayment of rent and material lease violations
b. Redemption apparently applies to more than just traditional nonpayment of rent cases
c. Combined actions for nonpayment of rent and material lease violations
f. In manufactured (mobile) home park lot tenancies
g. No waiver of right to redeem
h. Landlord extension of tenant's right to redeem
i. Waiver of costs and service fees
j. Good faith effort to redeem
21. Violation of tenant privacy and security
22. Landlord refused to accept rent
23. Rent credit for work done for the landlord by the tenant
24. Tenant financial obligations under a separate agreement with the landlord may not be rent
26. Notice for month to month tenants
28. Manufactured (mobile) homes not in mobile home parks
29. Tenant or landlord in bankruptcy.
30. Assessment of rent from guest
31. Landlords actual or acquiescence in unlawful activities
32. Rent claims under prior leases
34.Fair Debt Collection Practices Act defenses
35.Joint liability only if provided in lease
36. Right to cure under the lease
37. Foreclosure of residential rental property
F. Holding over after notice to quit defenses
b. Periodic tenancies with no rent term
d. Following cancellation of a contract for deed or a mortgage foreclosure
e. Different notice lengths for landlord and tenant
2. The lease does not provide for termination of the tenancy before expiration of the lease
c. Housing code provisions on retaliation
d. Litigating retaliatory notice in a tenant initiated case
4. Waiver of Notice to quit by acceptance of rent
a. In public and government subsidized housing
b. Manufactured (mobile) home park lot tenancies
5. Waiver of notice by issuing a later notice, extending a notice or executing a new lease
6. Waiver of notice by demanding subsequent rent in an eviction (unlawful detainer) action
7. Manufactured (mobile) home park lot tenancies
9. Reasonable accommodation of disabilities
10. Public and government subsidized housing.
a. Section 8 existing housing certificate and voucher programs.
(1) No notice required for breach cases
(2) Notice for business reasons
(4) State one year notice requirement
(6) Section 8 voucher subsidy termination
(7) Landlord notice to the Section 8 Office
b. Subsidized housing projects
(1) HUD Handbook No. 4350.3 projects
(2) Moderate rehabilitation projects
(3) RHCDS (formerly FmHA) projects
(4) Low Income Housing Tax Credit Projects
d. Revocation of tenant's notice to quit
11. Contract for deed cancellation
b. Tenant of Mortgagor as Defendant
14. Tenant revocation of tenant's notice to quit
15.Expiration of lease following tenant's failure to give proper notice of renewal
1. No right of reentry clause in the lease
2. Implied modification of the lease or waiver of lease provisions
3. Plaintiff unilaterally modified the lease
4. Waiver of breaches by acceptance of rent
a. In government subsidized housing
(1) Breach of a fundamental lease term
(3) The lease contains an enforceable nonwaiver clause
(5) Payment of rent into court
c. Waiver of a nonwaiver clause
5. Waiver of breaches by executing a new lease
6. Waiver of breaches by demanding subsequent rent in an eviction (unlawful detainer) action
9. Reasonable Accommodation of disabilities
10. Public and government subsidized housing
a. Notice and administrative process
(3) Criminal activity by tenants and third parties
(b) Section 8 certificates and vouchers
(4) Other actions of third parties
(6) Laundry list of allegations
c. Section 8 Existing Housing Certificate and Voucher Programs
d. Government subsidized housing projects
f. Low Income Housing Tax Credit properties
g. Violence Against Women Act (VAWA)
11. Manufactured (mobile) home park lot tenancies
16. Allegations of unlawful activity
a. Covenant of landlords and tenants.
d. Public and subsidized housing.
f. Reasonable accommodation of disabilities
19. The breach is not material.
21. Combined actions for nonpayment of rent and material lease violations
22. Tenant guest and trespass rules
23. Nonpayment of utilities and other charges
25. Lack of clear rules or lease provisions
26. Plaintiff must prove lease violations by a preponderance of the evidence
27. Written lease provisions may not continue after expiration of the lease
28. Lease provisions providing for forfeiture should be strictly interpreted to avoid forfeiture
29. Tenant’s breach was caused by landlord’s breach.
30. Lease requirement for notice must be followed.
31. Eviction for emergency police calls
34. Eviction of one tenant but not the other
37. Landlord’s violation of covenants of habitability as defense to tenant breach
Chapter VII:
Remedies And Requests For Relief
Chapter VIII:
Post Trial Issues
B. Writ of Recovery or Restitution.
2. Unavailability of writ for nonpayment of future rent
2. Removal of the tenant and property
D. Waiver of the writ or the right to restitution
1. Motions in anticipation of appeal
a. Motion for new trial or amended findings not required for appeal
b. Motions on bonds, fees and staying eviction pending appeal
2. Motion to vacate judgments and stay or quash the writ of restitution
a. Lack of personal jurisdiction
b. Substantial compliance with settlement agreement
c. Eviction grounds outside scope of complaint
e. Landlord violation of settlement agreement
f. Improper enforcement of writ
g. Landlord waiver of tenant violation of settlement agreement
i. Improper notice to Section 8 Office
k. Unavailability of writ for nonpayment of future rent
3. Motion for return of personal property
4. Motion for costs and attorney fees
5. Motion to Seal or Expunge Court Records
(1) Action should not have been filed
(3) Unique circumstances outside the defendant’s control
(8) Mortgage foreclosures and cancelled contract for deeds
c. Judge review of referee denial of expungement
Chapter IX:
Judge Review of Referee Decisions
B. The Appeal Lies from Entry of Judgment
D. Housing Court Appeal V. Judge Review
E. Motions in Anticipation of Appeal
1. Motion for new trial or amended findings not required
4. Appeal after issuance of the writ: certificate to stay execution of the writ pending appeal
Chapter XI:
Writ of Prohibition
Chapter XII:
Nuisance Proceedings
Introduction To Unlawful Detainer (Eviction) Actions
and Landlord-Tenant Relationships
1. Recodification of Landlord-Tenant Laws
The 1998 legislature passed a recodification of the existing landlord-tenant statutes in Chapters 504 and 566 into a new chapter 504A. The legislature delayed the effective date of Chapter 504A and the repeal date of Chapters 504 and 566 one year to allow for study and comment of the recodification. The purpose of Chapter 504A was to make landlord-tenant laws more accessible to the public by placing them in one chapter, and rewriting them in a more understandable form. A committee of landlord and tenant attorneys reviewed Chapter 504A, and proposed in its place Chapter 504B, which was an attempt to reach the goals of Chapter 504A while better ensuring that the recodification does not change state law.
In 1999 the legislature passed 504B. It replaces both 504A, which never went into effect, and 504 and 566, which it consolidated. Tenants should cite to both 504B (the current statutes) and either 504 or 566 (the old statutes), since case law up to 1999 cited the old statutes. This manual contains cites to both the new statute and it old counterpart. Tenants can review and download a copy of 504B, 504, and 566 from the Minnesota Legislature at http://www.leg.state.mn.us/leg/statutes.htm. Tenants also should review the Statute Cross Reference Charts (Form 1).
As part of the recodification creating Chapter 504B, the term unlawful detainer was replaced with eviction. Minn. Stat. § 504B.001. This manual will use both terms, often with a cross reference to the other term, since all cases before 1999 used the term unlawful detainer.
Many cases interpreting landlord-tenant law are unreported, either at the state district court or Court of Appeals levels. Unreported district court decisions are in an appendix to this manual. Given the rise of tenant screening agencies reporting information on eviction cases, recent decisions discussed in this manual do not contain the tenant’s name in the citation.
This manual also refers to some unpublished district court decisions contained in Minnesota Residential Tenant Remedies and its appendix (TR), which covers actions brought by tenants to enforce tenant rights. Unreported Court of Appeals decisions can be reviewed and downloaded from the Minnesota State Courts, as well as online legal research services.
3. Effect of Unpublished Court of Appeals Decisions
Since creation of the Minnesota Court of Appeals, most appellate decisions discussing residential landlord-tenant law have been unpublished decisions of the Court of Appeals, rather than published decisions of the Court of Appeals or Minnesota Supreme Court. Unpublished decisions of the Court of Appeals may be of persuasive value, but are not precedential. Dynamic Air, Inc. v. Bloch, 502 N.W.2d 796 (Minn. Ct. App. 1993); Minn. Stat. § 480A.08, subd. 3 (Unpublished opinions of the Court of Appeals are not precedential. Unpublished opinions must not be cited unless the party citing the unpublished opinion provides a full and correct copy to all other counsel at least 48 hours before its use in any pretrial conference, hearing, or trial. If cited in a brief or memorandum of law, a copy of the unpublished opinion must be provided to all other counsel at the time the brief or memorandum is served, and other counsel may respond). The Dynamic Air Court noted that the trial court "committed error by relying upon an unpublished [Court of Appeals] opinion ...." The Court added that "a party may cite to an unpublished opinion affirming a trial court's exercise of discretion to persuade a trial court to exercise discretion in the same manner. It is, however, improper to rely on unpublished opinions as binding precedent." Id. at 800. However, counsel may have an ethical obligation to cite unpublished opinions adverse to counsel's client if that authority is the only opinion on point in the jurisdiction. M. Johnson, Advisory Opinion Service Update, Bench & Bar of Minn. at 13 (Oct. 1993). See generally 3 E. Magnuson, D. Herr & R. Haydock, Minn. Prac. § 117.3 at 95 (Supp. 1994).
4. Preemption of Ordinances by State Statutes
Many cities have ordinances regulating landlord and tenant relationships. Rarely a state statute will specifically preempt application of a contrary ordinance. See Minn. Stat. § 504B.205 and Eviction for Emergency Police Calls, discussion, infra, at VI.G.31.
In City of Morris v. Sax Investments, Inc., 730 N.W.2d 531 (Minn. Ct. App. 2007), the Court of Appeals considered a challenge to a local habitability ordinance on the grounds that it was preempted by the state building code. The Court concluded that the state building code did not preempt local regulation of habitability. On appeal, the Minnesota Supreme Court held that the authority of municipalities to enact and enforce habitability standards for rental housing is constrained by the prohibition on municipal regulation of building code provisions in Minn. Stat. § 16B.62, subd. 1. City of Morris v. Sax Investments, Inc., 749 N.W.2d 1, 3 (Minn. 2008).
B. Summary of Unlawful Detainer (Eviction) Actions and Court Procedure
The unlawful detainer action is now called an eviction action under Minn. Stat. § 504B.001, Subd. 4. It is a summary proceeding, created by statute, to allow the landlord or owner of rental property to evict the tenant or possessor of the property. The landlord prepares a complaint, often using a form. (Forms Z-CJ-C and Z-4th-C). The plaintiff files the case with the court administrator, who prepares a summons. The defendant must be served at least seven days before the initial hearing, either by personal or substitute service.
The filing fee for court actions, including eviction actions, is $252. Other fees in the Hennepin County/Fourth District Housing Court are $500 for appeals, $75 for juries, $12 for subpoenas, $40 for writ of recoveries, $10 for certified copies, and $5 for uncertified copies, with no fees for motions in housing court or conciliation court, even though there is a general $55 motion fee under Minn. Stat. § 357.021.
In most courts, the initial hearing serves as an arraignment. If the defendant does not appear, the court will find for the plaintiff and issue a Writ of Restitution. If the defendant appears to contest the action, the court generally will schedule a trial for another day. While a written answer is not required, the courts require a $252 fee if the defendant files an answer, unless the defendant obtains in forma pauperis status. If the defendant appears and does not contest the action, the court will find for the plaintiff, but might stay issuance of the Writ of Restitution for seven days.
In the Fourth Judicial District (Hennepin County), referee presides over the arraignment, which could include as many as 50 cases scheduled on the calendar. The clerk does a roll call before the arraignment begins. The order of cases is judge requests, defaults, settled cases, disputed cases with counsel, and disputed cases without counsel. See Memorandum to Housing Court Staff from Sue Daigle (Oct. 3, 1996) (Appendix 173). If a trial is necessary, the referee generally will schedule it for another day. However, now and then judges may substitute for the referee at arraignment, and may be more inclined to schedule trials for that day. Tenants should call the Housing Court Administration Office to find out in advance who is hearing arraignments. The court also may schedule an evidentiary hearing if needed to resolve pre-trial motions, such as motions for dismissal for improper service.
A party may opt out of a Housing Court referee hearing by filing a written request the day before the first hearing, and the case will be referred to a judge. A party also may remove a specific referee from a case, as can be done with judges assigned to cases, upon a written notice of removal. The court then would assign the case to either another referee or a judge.
Hennepin County Housing Court administrative services are divided into two offices, with one office on the skyway public service level handling eviction (formerly unlawful detainer) action case filings and public service information, and the seventeenth floor housing the Housing Court courtrooms and clerks office handling other services. See Hennepin County District Court, Access, Filing & Information Are Moving (Appendix 174). In 2009 the Housing Court will move to the third floor for courtrooms and clerks offices. The Housing Court issued a May 15, 1996, Order approving acceptance of uncertified checks from Legal Aid and other law firms. The Housing Court retains discretion to decide whether to accept uncertified checks from social service agencies. It takes quite a bit longer for the Court to process and disperse uncertified funds, so if quick dispersal of funds is important to the tenant, the tenant or tenant's attorney should submit funds by certified check. (Appendix 174A).
At trial, the plaintiff has the burden of proof by preponderance of the evidence, and the defendant may raise numerous statutory and common law defenses. If the tenant prevails, the landlord may not evict the tenant at this time. If the landlord prevails, the court may immediately issue a Writ of Restitution, or stay issuance of the Writ for up to seven days. The landlord then must arrange for the sheriff or police to deliver the Writ, which is a 24-hour eviction notice. If the tenant does not move, the landlord must schedule an eviction of the tenant with the sheriff or police. The landlord must store the tenant's property, either on site or with a storage company, for up to 60 days.
Either party may appeal from entry of judgment, within 10 days of entry of judgment. If the case was heard by a referee in the Second or Fourth Judicial Districts (Ramsey and Hennepin counties), a party may request district court judge review of the decision, but should request stay or vacation of entry of judgment pending review to preserve the right to appeal.
C. Creation of a Landlord-Tenant Relationship.
A landlord-tenant relationship arises when one person occupies the premises owned by another with or without consent, in subordination to the other person's title. Gates v. Herberger, 202 Minn. 610, 612, 279 N.W. 711, 712 (1938). The relationship is created by a conveyance of property for a period less than the conveying party has in the premises, in consideration of rent, leaving the landlord a reversionary interest. State v. Bowman, 202 Minn. 44, 46, 279 N.W. 214, 215 (1938). See 10B DUNNELL MINN. DIGEST 2D Landlord and Tenant § 1.00.
The term "lease" generally is used to refer to the physical document creating the tenancy, although it is common to refer to a tenancy created by an oral agreement as an "oral lease". The lease is both a conveyance of the right to possession of real property and a contract creating the terms for the landlord-tenant relationships. Local Oil Company, Inc. v. City of Anoka, 303 Minn. 537, 539, 225 N.W. 2d. 849, 851 (1975). Often the term "lease" and "tenancy" are used interchangeably to describe the relationship between the landlord and tenant. The tenant's interest in the property is a leasehold interest. Sanford v. Johnson, 24 Minn. 172, 173 (1877). While a tenancy may be created by an oral or written lease, it also may be created by operation of law.
A tenancy for a fixed term also is called a tenancy for years, and can be for any duration. Generally, during the term of the lease, the terms of the agreement cannot be changed without the consent of the parties. The landlord cannot evict the tenant unless the tenant has breached (violated) the lease. The tenant cannot terminate the lease before the end of the term without the landlord's consent, unless a constructive eviction occurs or the tenant enters the miliary service and gives written notice to the landlord.
Some term leases allow the landlord and tenant to terminate the lease before the end of the term with notice. However, in some cases, the notice period may be unconscionable. See Pickerign v. Pascal Marketing, Inc., 303 Minn. 442, 446, 228, N.W. 2d 562, 565 (1975) (lease providing for 30-day notice to service station operator may be unconscionable). If a term lease becomes void under the statute of frauds, the law will imply the creation of a tenancy at will. Fisher v. Heller, 174 Minn. 233, 236, 219 N.W. 79, 80 (1928).
When a landlord has proposed a written term lease, but the tenants took occupancy without signing it and the landlord did not provide a copy to the tenants, the written lease is not applicable to the tenancy, leaving the landlord and tenant in a month-to-month oral tenancy. Ochoa v. Kenneth, UD-1950919505 (Minn. Dist. Ct. 4th Dist. Oct. 20, 1995) (Appendix 79). But see Line v. Reynolds, Number UD-1960612512 (Minn. Dist. Ct. 4th Dist Aug 12, 1996) (Appendix 175) (Consolidated unlawful detainer (now called eviction) and rent escrow actions; landlord could require tenant to sign a term lease rather than continue as a month to month tenant).
2. Month-to-month and other periodic tenancies
A periodic tenancy is a tenancy made up of an indefinite series of rental periods, which either party may terminate by giving written notice before the last rental period. A periodic tenancy also is created where a tenant of urban real estate holds over after expiration of a lease, with a period of the tenancy being the period between payments. Minn. Stat. §§ 504B.135 (formerly 504.06), 504.141 (formerly § 504.07). Upon expiration of an initial term lease, without any action by the parties to renew the lease, the parties' continuation of the landlord-tenant relationship becomes a month-to-month tenancy and cannot be based on the original written lease. Urban Investments, Inc. v. Thompson, No. UD-1950626525 (Minn. Dist. Ct. 4th Dist. Aug. 10, 1995) (Appendix 80). When a landlord has proposed a written term lease, but the tenants took occupancy without signing it and the landlord did not provide a copy to the tenants, the written lease is not applicable to the tenancy, leaving the landlord and tenant in a month-to-month oral tenancy. Ochoa v. Kenneth, UD-1950919505 (Minn. Dist. Ct. 4th Dist. Oct. 20, 1995) (Appendix 79).
In the most common form, the month-to-tenancy, written notice must be given before the last month of the tenancy. Minn. Stat. § 504B.135 (formerly 504.06); Johnson v. Ceil Hamm Brewing Company, 213 Minn.12, 16, 4 N.W.2d 778, 781 (1942); Oesterreicher v. Robertson, 187 Minn. 497, 501, 245 N.W. 825, 826 (1932). See Mako v. Naditch & Sons, 303 Minn. 6, 7, 226 N.W.2d 289, 290 (1975) (strict compliance required); Eastman v. Vetter, 57 Minn. 164, 166, 58 N.W. 989, 989-90 (1894) (defective notice void and not effective at end of next month). A periodic tenancy does not terminate upon the death by either party. State Bank of Loretto v. Dixon, 214 Minn. 39, 43, 7 N.W.2d 351, 353 (1943).
It is unclear whether the landlord has the right to unilaterally modify the terms of a periodic tenancy by giving the same kind of notice as is required to terminate the tenancy. Landlords argue that it is a common practice for landlords to give notice of changes in the rent or building rules, and for these changes to be accepted as part of the lease without the need for specifically terminating the existing tenancy or informing the tenant that the tenant must move if the tenant does not accept the new terms. Alternatively, landlords argue that such a notice is actually a notice to terminate the old periodic tenancy combined with an offer to re-rent the premises on new terms.
Tenants argue that if the tenant objects to the rent increase, the tenant cannot be bound to a new lease by implication. See Urban Investments, Inc. v. Thompson, UD-1950626525 (Minn. Dist. Ct. 4th Dist. Aug. 10, 1995) (Appendix 80) (additional provisions that were not part of the original lease do not create additional obligations on the part of the tenant, without an agreement to make the additional provisions part of a new lease); Fundamentals of Landlord/Tenant Law and Practice, supra, § 4.1-02(3) at 3-4 (MCLE 1988). However, a notice that explicitly terminates an existing tenancy, offers to renew the lease at an increased rent, and specifies that the offer may be accepted by remaining in possession past the expiration of the original term should be effective.
Historically there was some disagreement over whether a periodic tenancy was a tenancy at will. See State Bank of Loretto v. Dixon, 214 Minn. 39, 43 n.1, 7 N.W.2d 351, 353 n.1 (1943). Compare 10b Dunnell Minn. Digest 2d Landlord and Tenant § 1.02 and Fundamentals of Landlord/Tenant Law and Practice, § 4.1-02(4) at 4. In any event, a tenancy at will generally has the same legal effect as a periodic tenancy.
A tenancy at will has an uncertain term, and is created where the parties agree to a tenancy without a fixed term, Weidemann v. Brown, 190 Minn. 33, 40-41, 250 N.W. 724, 727 (1933); where the lease is void, Hagen v. Bowers, 182 Minn. 136, 137-38, 233 N.W. 822, 823 (1931); or where a tenant remains on the property after expiration or termination of the lease (holdover tenant) and continues to pay rent, Paget v. Electrical Engineering, 82 Minn. 244, 246, 84 N.W. 800, 801 (1901). Where the parties relationship was a personal and domestic partnership, rather than a relationship of landlord-tenant, vendor-vendee, or arms-length contracting parties, the relationship may be a tenancy-at-will. Charboneau v. Johnson, UD-1950817510 (Minn. Dist. Ct. 4th Dist. Aug. 30, 1995) (Appendix 81). Where there is a landlord-tenant relationship, but the term is indefinite and the rent is unclear, the relationship may be a tenancy-at-will. Hansen v. Trom, UD-1950926503 (Minn. Dist. Ct. 4th Dist. Nov. 6, 1995) (Appendix 82).
Permission is all that is needed from an owner to create a tenancy-at-will, and rent or other obligations are not needed. Thompson v. Baxter, 107 Minn. 122, 119 N.W. 797 (1909); Lee . Regents of the University of Minnesota, 672 N.W.2d 366 (Minn. Ct. App. 2003) (followed Thompson).
Either party may terminate a tenancy at will in the same manner as a periodic tenancy. Minn. Stat. § 504B.135 (formerly 504.06). A tenancy at will does not terminate upon sale of property by the owner, Fisher v. Heller, 174 Minn. 233, 236, 219 N.W. 79, 80 (1928) or upon death of either party. See R. Schoshinski, supra, § 10.3.
A tenancy at sufferance describes the legal limbo which exists when a tenant holds over after expiration or termination of the lease and the landlord does not accept rent. Weidemann v. Brown, 190 Minn. 33, 40-41, 250 N.W. 724, 727 (1933). It is not a true tenancy because there is no landlord/tenant relationship between the parties, but the landlord must bring an eviction (formerly unlawful detainer) action to evict the tenant. Minn. Stat. § 504B.285 (formerly § 566.03), 504B.301 (formerly § 566.02).
A subtenancy is created when a tenant transfers the tenant's possessory interest under the lease to another for less than the whole term of the lease. Warnert v. MGM Properties, 362 N.W.2d 364, 367 (Minn. Ct. App. 1985). A subtenancy creates a landlord tenant relationship between the tenant-sublessor and subtenant. Privity of estate exists between the landlord and the tenant, and the sublessor and the subtenant, but not between the landlord and the subtenant. See R. Schoshinski, §§ 8.11-8.12. Generally, termination of the prime lease terminates the subtenant's possessory rights under the sublease, but surrender of the prime lease does not terminate the sublease. It simply causes the lessor to "step down" to the position of the sublessor on the sublease. Warnert, 362 N.W.2d at 367-69. A tenant may not create a sublease for a time period identical to the tenants lease with the landlord, and co-tenants of a landlord may not create a sublease between themselves. Hansen v. Trom, UD-1950926503 (Minn. Dist. Ct. 4th Dist. Nov. 7, 1995) (Appendix 82).
The writ cannot be enforced against a subtenant who was not a party to the eviction (unlawful detainer) action nor named in the writ of restitution. See Kowalenko v. Haines, No. C6-85-1365 (Minn. Ct. App., July 24, 1985) (attached as Appendix 4). In Kowalenko, the petitioner had subleased the apartment from the former tenants. The writ was enforced against the petitioner, pursuant to an unlawful detainer action against former tenants, but not the petitioner. The petitioner was not named in the writ. The court ordered the landlord to return possession of the apartment and petitioners personal property to her, pursuant to Minn. Stat. § 504B.375 (formerly § 566.175).
An assignment is created when a tenant transfers the tenant's possessory interest under the lease for the full remaining term of the lease. Kostakes v. Daly, 246 Minn. 312, 315-16, 75 N.W.2d 191, 193-94 (1956). Where a third person is in possession of the premises under a lease, the law presumes that the lease has been assigned by the lessee to such person, but the presumption is rebuttal. O'Neal v. A.F. Oys & Sons, 216 Minn. 391, 394, 13 N.W.2d 8, (1944). However, the reservation of the right to collect rents, reenter in case of default, and enter to make repairs creates a sublease, rather than an assignment. Judd v. Landin, 211 Minn. 465, 472, 1 N.W.2d 861, 865 (1942).
An assignment leaves privity of estate only between the landlord and the assignee, and privity of contract between the tenant-assignor and the assignee. Kostakes, 246 Minn. at 316, 75 N.W.2d at 194. However, in some cases the assignee may be an equitable assignee, subject to the covenants and obligations of the agreement between the landlord and tenant-assignor. Baehr v. Penn-O-Tex Oil Corp., 258 Minn. 533, 536, 104 N.W.2d 661, (1960). The assignee is liable for rent only during the time the assignment. O'Neil v. A.F. Oys & Sons, 216 Minn. 394-95, 13 N.W.2d at . However, the landlord and the assignee could agree that the assignee would pay prior rent. Additionally, if the assignee vacated before the end of the assignment period, the assignee could be liable for rent for the balance of the assignment period.
A landlord may prohibit assignment and subletting by the terms of the lease, or limit assignment and sublet to the landlord's sole consent. A landlord has no duty to agree to an assignment or sublease where the tenant desires an early termination of the lease and proposes an assignment or sublease to mitigate damages. Gruman v. Investors Diversified Services, Inc., 247 Minn. 502, 505-08, 78 N.W.2d 377, (1956). A landlord may condition consent to assignment on specific terms or restrictions. Leonard, Street & Deinard v. Marquette Assocs., 353 N.W.2d 198, 200-01 (Minn. Ct. App. 1984). However, acceptance by the landlord of rent from the assignee with knowledge of the assignment waives a provision requiring consent of the landlord to any assignment. O'Neal v. A.F. Oys & Sons, 216 Minn. at 394, 13 N.W.2d at .
See generally 10B Dunnell Minn. Digest 2D Landlord and Tenant, §§ 2.01-2.02, 7.04; R. Schoshinski, Ch. 8.
Domestic partners may or may not be in a landlord-tenant relationship, and if not, an eviction (formerly unlawful detainer) action not be an appropriate forum to determine their possessory interests in the property. In Shustarich v. Fowler, UD 1960604520 (Minn. Dist. Ct. 4th Dist. July 5, 1996) (Appendix 176), Plaintiff and defendant first lived in defendant's home. Then plaintiff and defendant moved from her home to a second property, and the parties then living at the second property moved to defendant's old home. Plaintiff took title to the new property, and defendant contributed several thousand dollars from the sale of her home to a new roof and appliances. The parties kept separate expenses. After defendant obtained an order for protection, plaintiff gave notice and filed an unlawful detainer action. The court concluded that plaintiff failed to establish a landlord-tenant relationship, defendant was entitled to assert an interest in the premises, and an unlawful detainer action was a summary remedy inappropriate to try issues of title or to substitute for an action in ejectment, and denied restitution of the premises. See In re Estate of Ericksen, 337 N.W.2d 671 (Minn. 1983). But see Stock v. Beaulieu (Minn. Dist. Ct. 9th Dist. Mar. 9, 1995) (Appendix 140) (domestic partners were in landlord-tenant relationship; plaintiff retaliated against defendant for reporting a crime of domestic abuse committed by the plaintiff in which the defendant was the victim).
When the parties have neither a written nor oral agreement of undisputed terms but act as if there is a rental agreement by continuing all the indicia of a landlord/tenant relationship, the court must determine the applicable terms by their actions and the surrounding circumstances. The landlord’s regular acceptance of a specific sum from the tenant based on the tenant’s written offer to pay that sum, and the landlord’s acceptance of it for the following eight months without any written or oral objections to it, establishes the parties’ agreement to rent at that sum. Orchestra Hall Associates v. Crawford, No. UD-1960119508 (Minn. Dist. Ct. 4th Dist. Feb. 13, 1996) (Appendix 177).
8. Covenant running with the land
In general, basic covenants that touch the land run with the land, including covenants to pay rent and maintain the property. R. Schoshinski, American Law Of Landlord And Tenant Ch. 8 (Bancroft-Whitney 1980 and Supp. 2008). A new landlord takes the land with the rights and liabilities which existed between the old landlord and the tenant. Glidden v. Second Avenue Investment Co., 125 Minn. 471, 473-74, 147 N.W. 658, 659 (1914); Farmers Insurance Exchange v. Ouellette, No. C8-97-1504 (Minn. Ct. App. Feb. 24, 1998) (Appendix 330) (Unpublished: new landlord assumed terms of modified lease under the terms of the lease, and Minnesota case law). The old landlord's rights and obligations transfer over to the new landlord, if the tenant had notice of the change. See Pillsbury Investment Co. v. Otto, 242 Minn. 432, 437, 65 N.W.2d 913, (1954). See also Borer v. Carlson, 450 N.W.2d 592, 594 (Minn. Ct. App. 1990); Snortland v. Olsonawski, Minn. , 238 N.W.2d 215, 217-18 (1976).
9. Covenants implied by statute
All oral and written leases include implied statutory covenants on habitability and illegal activity. Minn. Stat. §§ 504B.161 (formerly § 504.18), 504B.171 (formerly § 504.181). See discussion at VI.E.1. (habitability), VI.G.16. (unlawful activities).
10. Lease renewal or extension
If a term for the duration of the lease's extension is indefinite, any extension due to holdover and payment is limited to the duration of the original lease. Hildebrandt v. Newell, 199 Minn. 319, 272 N .W. 257 (1937); Hallin v. Hallin, No. C3-02-910, 2002 WL 31893031 (Minn. Ct. App. Dec. 31, 2002) (unpublished). Acceptance of rent following expiration of lease creates a month to month lease, but not a lease renewal where negotiations still were underway. Stoneburner v. Dubow, No. CX-01-2160, 2002 WL 1051700 (Minn. Ct. App. May 28, 2002) (unpublished).
Minn. Stat. § 504B.145 (formerly § 504.21) restricts automatic renewals of leases.
Notwithstanding the provisions of any residential lease, in order to enforce any automatic renewal clause of a lease of an original term of two months or more which states, in effect, that the term shall be deemed renewed for a specified additional period of time of two months or more unless the tenant gives notice to the landlord of an intention to quit the premises at the expiration of the term due to expire, the landlord must give notice to the tenant as provided in this section. The notice must be in writing and direct the tenant's attention to the automatic renewal provision of the lease. The notice must be served personally or mailed by certified mail at least 15 days, but not more than 30 days prior to the time that the tenant is required to furnish notice of an intention to quit.
There is little case law interpreting it. In Mid Continent Management Corp. v. Donnelly, 372 N.W.2d 814 (Minn. Ct. App. 1985), the Court held that tenants may not enforce an automatic renewal clause if the landlord has not given the statutory notice.
Fixed term leases often include a provision that following expiration of the original lease term, the tenancy will continue on a month-to-month basis. Such provisions do not trigger the notice requirement of the automatic renewal statute, Minn. Stat. § 504B.145 (formerly § 504.21), since it only applies to leases of an original term of at least two months and a renewal period of at least two months.
However, it is unclear how § 504B.145 (formerly § 504.21) applies a periodic tenancy where the parties have agreed to a two month or 60 day notice period. On one hand, the parties have mutually agreed to the longer notice period in order to give both parties more time to respond to a notice to quit, and the parties should be bound to the agreement. See Control Data Corp., v. Metro Office Parks, Co., 208 N.W.2d 738, 740 (Minn. 1973) (after commercial tenant exercised option to extend lease, tenant was bound by 12 month notice requirement of the lease). On the other hand, § 504B.145 (formerly § 504.21) requires that in leases with an original term of at least two months, and then an automatic renewal period of at least two months if the tenant does not give a notice to quit, the landlord must give a reminder notice to the tenant at least 15 days before the tenant is required to give the notice to quit. In theory, this would require the landlord to give such a reminder notice every two months. This interpretation would appear to conflict with Minn. Stat. § 504B.135 (formerly 504.06), which provides that a periodic tenancy with a rental period of three months or more may be terminated by three months notice, thus a revolving three month periodic tenancy. Perhaps the applicability of § 504B.145 (formerly § 504.21) to a two month periodic tenancy rests on how one analyzes operation of the tenancy. On one hand it is a tenancy that continues on a one month-to-one month basis, but a two month termination notice is required. On the other hand, it is a two month-to-two month tenancy, since at any point in time a two month termination notice is required to terminate it.
Adult members of the same family in the same dwelling might or might not be in a landlord and tenant relationship. If one member owns the property and the other does not pay rent or provide services in lieu of rent under Minn. Stat. § 504B.001 discussed next, the owner still could file an eviction action to evict the other person as one unlawful detaining the property under Minn. Stat. § 504B.301 (formerly § 566.02). See DePetro v. DePetro, No. A03-727, 2004 WL 885552 (Minn. Ct. App. April 27, 2004) (unpublished) (affirmed eviction by owner of her adult daughter who was not a rent-paying tenant). See Subject Matter Jurisdiction, infra, at III.
The definitions of tenants and buildings that now are in Minn. Stat. § 504B.001 were formerly in Minn. Stat. § 566.18 of the Tenants' Remedies Act, and had been incorporated in the Rent Escrow Act, § 566.34, and applied by § 504.27 to the following statutes: §§ 504B.271 (formerly § 504.24) (property abandonment), 504B.204 (formerly § 504.245) (action for rental of condemned residential premises), 504B.225 (formerly § 504.25) (criminal unlawful eviction or termination of utilities), 504B.231 (formerly § 504.255) (unlawful eviction), 504B.221 (formerly § 504.26) (unlawful termination of utilities), and 504B.315 (formerly § 504.265) (restrictions on eviction due to familial status).
"Residential tenant" means any person who is occupying a dwelling in a building. . . under any agreement, lease, or contract, whether oral or written, and for whatever period of time, which requires the payment of money or exchange of services as rent for the use of the dwelling unit, and all other regular occupants of that dwelling unit, or any resident of a manufactured home park.
"Residential building” means any building used in whole or in part as a dwelling, including single family homes, multiple family units such as apartments, and structures containing both dwelling units and units used for non-dwelling purposes, and also includes a manufactured home park.
“Landlord” means the owner or owners of the free hold of the premises or lesser estate therein, contract vendee, receiver, executor, trustee, lessee, agent, or any other person, firm or corporation directly or indirectly in control of a building.
F. Manufactured (Mobile) Home Park Lot Tenancies
Minn. Stat. Ch. 327C governs rental of lots in manufactured or mobile home parks. A manufactured home park is land on which two or more occupied manufactured homes are located and where facilities are open for more than three seasons. §§ 327C.01, subd. 5, 327.14. The rental agreement must be in writing and include elements required by statute. § 327C.02, subd. 1. 60 days notice is required to change any park rules. However, a rule adopted or amended after a resident initially enters into a rental agreement can be enforced against that resident only if the new or amended rule is reasonable and is not a substantial modification of the original agreement. § 327C.02, subd. 2. A park owner may terminate the tenancy only for cause. § 327C.09.
G. Public and Government Subsidized Housing Tenancies
Tenancies in public and government subsidized housing are a hybrid of traditional periodic and fixed term tenancies. On one hand, the tenancy has an indefinite term without an expiration date. On the other hand, the landlord cannot terminate the tenancy simply by giving notice; the landlord must have good cause to terminate the tenancy. See generally HUD Housing programs: Tenants' Rights (National Housing Law Project, 2d ed. 1994 and Supplements); F. Fuchs, Introduction To HUD - Public and Subsidized Housing Programs (March 5, 1993).
There are four categories of public and government subsidized housing. In each of these housing programs, the tenant's rent usually is based on a percentage of the tenant's adjustable income. First, public housing is owned and operated by local housing authorities with assistance from the federal government. The housing authority may terminate the tenancy for serious violations of a material lease term or other good cause.
Second, a number of programs provide federal funds directly to landlords in connection with the building, renovation or operation of subsidized housing units. The landlord may terminate the tenancy for material noncompliance with the lease, material failure to meet obligations under state, landlord/tenant law or other good cause. These programs include Section 8 New Construction Substantial Rehabilitation, and Set-Aside; Section 8 administered by state housing finance agencies or owned and operated by the United States Department of Housing and Urban Development (HUD); and Section 236, 221 and 202 programs. Some of these programs, including the Section 8 Moderate Rehabilitation and Project Based Certificate programs, also provide for local housing authority inspection for compliance with its housing code, and allow the housing authority to terminate the tenancy if the unit is not in compliance.
Third, and similar to the second set of programs discussed above, the Federal Low Income Housing Tax Credit program provides assistance to landlords in connection with the building, renovation or operation of subsidized housing units. Most tenants may not know that they are in a low income housing tax credit project, because their rent may not be based on their income. The Minnesota Housing Finance Agency (MHFA), as well as redevelopment agencies in Minneapolis and St. Paul, have listings of low income housing tax credit projects. Recently, in Bowling Green Manor L.P. v. Kirk, the Ohio Court of Appeals held that the landlord could terminate the tenancy only for good cause, following a 30-day written notice of termination setting forth specific good cause for eviction. No. WD 94-125, 1995 WL 386,476, 1995 Ohio App. LEXIS 2707 (June 30, 1995) (Appendix 83).
Fourth, some programs provide the tenant with a housing certificate or voucher, which allows the tenant to find a landlord willing to participate in the program. These programs include the Section 8 Existing Housing Certificate and Section 8 Voucher Programs. The housing authority sends a monthly rent subsidy to the landlord and the tenant pays the remaining share of the rent. The landlord may terminate the tenancy for serious or repeated violations of the lease, violation of federal, state, or local law which imposes an obligation on the tenant in connection with occupancy of the unit, or other good cause. Also, the housing authority can terminate the tenancy if the unit is not in compliance with its housing code.
The Minnesota Housing Finance Agency (MHFA) administers the Rental Assistance for Family Stabilization (RAFS) Program in partnership with local housing organizations in Minnesota counties with high average housing costs as determined by the United States Department of Housing and Urban Development (HUD). In Minneapolis, the program is operated by the Section 8 Office of the Minneapolis Public Housing Authority (MPHA). The program is similar to the Section 8 Existing Housing Certificate and Voucher Programs, in that it provides subsidies to tenants who then use the subsidy in the private rental market. While the state subsidy in the RAFS Program are smaller than the federal Section 8 subsidies, the program follows many of the requirements of the Section 8 programs, including federal Housing Quality Standards (HQS) for apartment conditions, and the requirement that the landlord notify the Section 8 Office of termination of tenancy and eviction actions. See RAFS Owners Handbook (Minneapolis Public Housing Authority May 1, 1999) (Appendix 414).
H. Non Leasehold Relationships
A hotel is a building which is kept, used and advertised, or held out to the public as a place for sleeping or housekeeping accommodations or supplied for pay to guests for transient occupancy. Transient occupancy means occupancy when it is the intention of the parties that the occupancy will be temporary. There is a rebuttable presumption that, if the unit occupied is the sole residence of the guest, the occupancy is not transient. There also is a rebuttable presumption that, if the unit occupied is not the sole residence of the guest, the occupancy is transient. Minn. Stat. § 327.70, subds. 3, 5.
In Luten v. Salvation Army, No. UD-1860324520 (Minn. Dist. Ct. 4th Dist. March 24, 1986) (Appendix 603) even though the respondent considered itself a hotel and not a landlord, the court noted that the nature of the tenancy is created by the conduct of the parties, as well as the written documents, and concluded that the petitioner was a tenant where he paid monthly rent for two years and reasonably understood that he was a tenant. See Residential Tenants' Remedies, Appendix 18. See Gutierrez v. Eckert Farm Supply, Inc., No. C5-02-1900, 2003 WL 21500161 (Minn. Ct. App. July 1, 2003) (unpublished) (affirmed conclusion that hotel resident was a tenant and not a hotel guest).
A license is an authority to do an act or series of acts upon the land of the person granting the license, without conferring on the licensee any estate in the land. Minnesota Valley Gun Club v. North Line Corp., 207 Minn. 126, 128, 290 N.W. 222, 224 (1940). See 11A Dunnell Minn. Digest Licenses in Real Property (3rd ed. 1978 and Supp. 1989). However, some landlord tenant statutes specifically include licenses. See e.g. Minn. Stat. §§ 504B.161 (formerly § 504.18) (covenants of habitability), 504B.171 (formerly § 504.181) (covenant not to manufacture or traffic drugs).
3. Caretakers: tenants versus employees
Caretakers traditionally were reviewed as occupying the premises incidentally to the caretaker's employment, and once the landlord terminated the employment, the employee who did not vacate immediately became a trespasser who could be evicted without court process. See Lighbody v. Truelsen, 39 Minn. 310, 40 N.W. 67 (1888); Trustees v. Froislie, 37 Minn. 447, 35 N.W. 216 (1887). However, Section 504B.001 (formerly § 566.18) now includes caretakers in the definition of tenant. State Auto Insurance Company v. Knuttila, 645 N.W.2d 475 (Minn. Ct. App. 2002) (caretaker was a tenant under Minn. Stat. § 504B.001 (formerly § 566.18)). See Mountainview Place Apartments v. Ford, No. 94CV1492 (Colo. Cty. Ct. Mar. 24, 1994) (Appendix 179) (Section 8 project tenancy was unaffected by employment agreement; termination of employment was not good cause for eviction).
In Deems v. Gustafson, No. C1-96-827 (Minn. Dist Ct. 9th Dist. Nov. 26, 1997) (Appendix 324) (Rasmussen, J.), the plaintiff's mother, who also was the defendant's late wife, initially owned the property. Through several transactions, plaintiff acquired title to the property, but reserving a life estate for her mother, who later made a handwritten note stating that defendant could live on the property past her death. Following her mother's death without a will, plaintiff gave a one month notice to defendant and filed an unlawful detainer (now called eviction) action. The court amended the action to be an action for a ejectment. The court found that it would be a hardship for the defendant to move from his home of 22 years, where he had no substantial savings or resources and was close to his relatives, while on the other hand, plaintiff would be unjustly enriched by dispossessing the defendant where she had contributed little to the property. The court concluded that the property would be subject to constructive trust by the defendant for the remainder of his life or as long as he occupied the property on the condition that he maintain the property in good condition, be responsible for utilities and routine maintenance, and pay plaintiff $100 per month for taxes and insurance.
An eviction (formerly unlawful detainer) action is available to enforce a change in occupancy mandated by a dissolution decree. In Swanson v. Wenzel, Nos. C1-97-2185 and C5-97-1881 (Minn. Ct. App. May 26, 1998) (Appendix 369) (Unpublished), the decree provided that the parties would own the homestead as joint tenants but would sell it by July 6, the appellant was entitled to exclusive occupancy, but if the property was not sold by July 6, the respondent would be entitled to exclusive occupancy and would have the obligation to resell it. After the parties did not sell the property and the appellant refused to move, respondent brought an unlawful detainer (now called eviction) action and was awarded a judgment of restitution. The court affirmed the decision, concluding that strict construction of the sale provision in the decree was proper.
See O'Connor v. Miller, UD-1940211505 (Minn. Dist. Ct. 4th Dist. Mar. 24, 1994) (Appendix 178) (tax forfeiture extinguishes prior leases; rent collection attempts created new leases).
During 1996 and 1997 the Pro Se Housing Court Subcommittee of the Conference of Chief Judges Pro Se Committee developed for various types of summary housing actions, including unlawful detainer (eviction), lock out, rent escrow, tenant remedies, and emergency tenant remedies actions. The Subcommittee also developed instructions for the forms. All of the forms and instructions were mailed to all of the district court administrators around the state. Included in the Forms Appendix is a copy of the forms which apply to the actions discussed in this article. Also included are forms drafted by the author which include many optional claims to allow for inclusion of claims under various housing statutes.
A. Summary Proceeding to Replace Self-help Eviction
Self-help evictions are prohibited. Berg v. Wiley, 264 N.W.2d 145, 149-51 (Minn. 1978) (Berg II). See also Minn. Stat. §§ 504B.101 (formerly § 504.01), 504B.225 (formerly § 504.25), 504B.231 (formerly § 504.255), 504B.281 (formerly § 566.01), 504B.301 (formerly § 566.02), 504B.375 (formerly § 566.175).
The unlawful detainer (eviction) action is a summary proceeding, created by statute, which provides an alternative to the common law ejectment action. Minn. Stat. §§ 504B.301 (formerly § 566.02) et. seq. Warnert v. MGM Properties, 362 N.W.2d 364, 366-67 n.1 (Minn. Ct. App. 1985) (“The unlawful detainer is not designed for extensive litigation, and the proceeding should not be used as a substitute for the common-law remedy of ejectment. The issues of abandonment and surrender raised in this case are clearly not amenable or appropriate to a summary detainer proceeding. The postural difficulties presented in this case demonstrate the wisdom of this rule. Plaintiff's proper remedy was an ejectment action, where necessary legal procedures and equitable remedies were available and the right to possession and damages could be resolved in one action.”). The action is for possession of the premises, and not for damages. Minn. Stat. §§ 504B.301 (formerly § 566.02), 504B.285 (formerly § 566.03).
B. Action Not Appropriate for Certain Types of Litigation
1. Parallel or complex litigation
In Rice Park Properties v. Robins, Kaplan, Miller & Ciresi, 532 N.W.2d 556 (Minn. 1995), the Minnesota Supreme Court decision reversed the Court of Appeals and affirmed the district court decision to stay an unlawful detainer (now called eviction) action pending final disposition of a related and earlier filed declaratory judgment action commenced by the tenant. In Stein v. J.D. White, Inc., No. CO-91-2164 (Minn. Ct. App. Apr. 21, 1992), Finance & Commerce at B24 (April 24, 1992) (App. 0.F) (unpublished), the commercial tenant brought a declaratory judgment, breach of contract and misrepresentation action against the landlord to determine responsibility for payment of utilities under the lease. The landlord then filed an unlawful detainer action against the tenant alleging breach of the lease by failure to pay a share of the utility bill. The court affirmed dismissal of the action, noting that when a pending parallel action will properly resolve the dispute which has been incorrectly brought as an unlawful detainer action, trial courts may grant procedural dismissals without ruling on the merits. The court noted that in "[i]nterpretations of complex lease provisions, particularly when collateral to the basic rent obligation, are not a amenable or appropriate to the type of summary disposition envisioned by the unlawful detainer act." Id. (citing Berg v. Wiley, 303 Minn. 247, 250, 226 N.W.2d 904, 906-07 (1975)). The court added that decisions on the merits merely determine the right to present possession of the property and do not determine the ultimate rights of the parties. Id. (citing William Weisman Holding Co. v. Miller, 152 Minn. 330, 188 N.W. 732 (1922)). See Bjur v. Burgmeier, No. C2-92-409 (Minn. Ct. App. Aug. 18, 1992), Finance & Commerce at B45 (Aug. 21, 1992) (unpublished: because plaintiff, as the mortgagee's assignee, has presumptively good title and because defendants cannot litigate title in an unlawful detainer action, defendants are foreclosed from challenging plaintiff's title by reference to their collateral litigation) (Appendix 0.H).
In Amresco Residential Mortgage Corp. v. Stange, 631 N.W.2d 444 (Minn. Ct. App. 2001), the trial court ruled that it could not consider mortgage defects in the eviction action. On appeal, the court held that rather than order the trial court to hear the issues or convert the action to an ejectment action, the appellants could seek to enjoin prosecution of the eviction action in the separate proceeding in which they sought to set aside respondent's foreclosure which they commenced after dismissal of their counterclaims in the eviction action. While the court affirmed dismissal of the counterclaims, it ordered that the court's stay of the writ of restitution during the appeal be continued for a reasonable period of time in which appellants can assert, and the district court can determine in their pending proceeding, whether their right of possession should be protected by enjoining the writ until the court rules on their title claims.
In Fraser v. Fraser, 642 N.W.2d 34 (Minn. Ct. App., 2002), the husband's father, who sold house to husband and wife under contract for deed, gave notice of cancellation of contract after husband brought dissolution action. The wife sought to enjoin cancellation as part of dissolution proceedings, which was granted and later vacated. The father then brought an eviction action against wife, and the district court ruled in father's favor. The wife appealed in both cases and they were consolidated. The court held that there was no jurisdiction in the dissolution action jurisdiction to enjoin cancellation of contract for deed. In the eviction action, the court held that the trial court was not bound by findings on the contract for deed service from the dissolution action, given the lack of jurisdiction in the latter. As to whether the wife could litigate equitable real estate issues in the eviction case, relying on Amresco Residential Mortgage Corp. v. Stange, 631 N.W.2d 444 (Minn. Ct. App. 2001), the court held that if she has the ability to litigate her equitable mortgage and other claims and defenses in alternate civil proceedings where she could enjoin the eviction action, it would be inappropriate for her to seek to do so in the eviction action. However, since the court could not determine whether the eviction action was wife's only opportunity to address her claims and defenses, it remanded the case for the district court to address wife's service claims, address the propriety of entertaining wife's equitable defenses in the eviction action or in an alternate proceeding; and, if appropriate, decide the equitable defenses.
Domestic partners may or may not be in a landlord-tenant relationship, and if not, an unlawful detainer (eviction) action not be an appropriate forum to determine their possessory interests in the property. In Shustarich v. Fowler, U.D. 1960604520 (Minn. Dist. Ct. 4th Dist. July 5, 1996) (App. 176), Plaintiff and defendant first lived in defendant's home. Then plaintiff and defendant moved from her home to a second property, and the parties then living at the second property moved to defendant's old home. Plaintiff took title to the new property, and defendant contributed several thousand dollars from the sale of her home to a new roof and appliances. The parties kept separate expenses. After defendant obtained an order for protection, plaintiff gave notice and filed an unlawful detainer action. The court concluded that plaintiff failed to establish a landlord-tenant relationship, defendant was entitled to assert an interest in the premises, and an unlawful detainer action was a summary remedy inappropriate to try issues of title or to substitute for an action in ejectment, and denied restitution of the premises. See In re Estate of Ericksen, 337 N.W.2d 671 (Minn. 1983). But see Stock v. Beaulieu (Minn. Dist. Ct. 9th Dist. Mar. 9, 1995) (Appendix 140) (domestic partners were in landlord-tenant relationship; plaintiff retaliated against defendant for reporting a crime of domestic abuse committed by the plaintiff in which the defendant was the victim).
Minn. Stat. § 504B.285 (formerly § 566.03), Subd. 1 provides the most common basis for subject matter jurisdiction:
1. Holding over after sale on an execution or judgment, expiration of the redemption period following mortgage foreclosure, or termination of a contract for deed.
2. Holding over after expiration of the term of the lease.
3. Breach of lease.
4. Nonpayment of rent.
5. Holding over after termination of the tenancy by notice to quit.
The landlord may combine actions for nonpayment of rent and material lease violations under § 504B.285 (formerly § 566.03), subd. 5. These claims shall be heard as alternative grounds. The hearing is bifurcated to first cover material violation of the lease, and then nonpayment of rent if the landlord does not prevail on the material lease violation claim. The tenant is not required to pay into court outstanding rent, interest or costs to defend against the material lease violation claim. If the court reaches the nonpayment of rent claim, the tenant shall be permitted to present defenses. The tenant shall be given up to seven days to pay any rent and costs determined by the court to be due, either into court or to the landlord.
Minn. Stat. § 504B.301 (formerly § 566.02) provides jurisdiction for unlawfully detaining the premises after having entered unlawfully, forcibly, or peaceably. Unlawful detention includes a seizure on residential rental property of contraband or a controlled substance manufactured, distributed or acquired in violation of Chapter 152 (Prohibited Drugs) and with a retail value of $100.00 or more, if the tenant does not have a defense under § 609.5317. See discussion, infra, at VI.G.16. While Minn. Stat. § 504B.285 (formerly § 566.03), subd. 1 applies to tenants, this section would cover occupants who are not tenants in addition to tenants. See DePetro v. DePetro, No. A03-727, 2004 WL 885552 (Minn. Ct. App. April 27, 2004) (unpublished) (affirmed eviction by owner of her adult daughter who was not a rent-paying tenant).
A tenant cannot bring an unlawful detainer (eviction) action against the landlord who has wrongfully reentered the premises. The tenant's remedy is provided by the lockout statute, Minn. Stat. § 504B.375 (formerly § 566.175). Berg v. Wiley, 303 Minn. 247, 250-51, 226 N.W.2d 904, 906-07 (1975). (Berg I).
A state court does not have jurisdiction over an unlawful detainer (eviction) action involving the right of an enrolled member of an Indian tribe to possession of property held in trust for Indians by the United States. White Earth Housing & Redevelopment Authority v. J.F., No. C8-91-224 (Minn. Dist. Ct. 9th Dist. Feb. 5, 1992) (Appendix 24); All Mission Indian Housing Authority v. Silvas, 680 F. Supp. 330 (C.D. Cal. 1987); 28 U.S.C. § 1360(b).
In Eagan East Ltd. Partnership v. Powers Investigations, Inc., 554 N.W. 2d 621 (Minn. Ct. App. 1996) the commercial landlord demanded from the commercial tenant a prospective and retroactive rent increase after the square footage used by the tenant was remeasured. When the tenant failed to pay the additional rent, the landlord filed an eviction (formerly unlawful detainer) action. The trial court held that the rent increase clauses in the lease were ambiguous and could not be applied retroactively from the new square footage measurement, but could be applied prospectively. The landlord then announced a new prospective rent increase, and in a subsequent order of the trial court, the court ruled that the landlord was entitled to the rent increase and the tenant was not entitled to attorney’s fees under the lease. On appeal, the Court of Appeals held that the trial court’s jurisdiction was limited to determining present possessory rights of the parties, and that the trial court exceeded its jurisdiction by ruling on the prospective rent increase and attorney’s fee issues. But see Duling Optical Corp. v. First Union Management, Inc., No. C5-95-2718 (Minn. Ct. App. Aug. 13, 1996), Finance & Commerce at 66 (Aug. 16, 1996) (Appendix 181) (unpublished decision: affirmed the district court’s conclusion in a separate damages action that it lacked jurisdiction to award attorney’s fees for separate eviction (formerly unlawful detainer) actions, since the issue of attorney’s fees should have been decided in the unlawful detainer actions).
See discussion, infra, at VI.C.
The hearing must be held within seven (7) to fourteen (14) days after issuance of the summons. Minn. Stat. § 504B.321 (formerly § 566.05).
The tenant may answer the complaint at the initial hearing. Minn. Stat. § 504B.335 (formerly § 566.07). The new Housing Court Rules do not require a written answer. Minn. Gen. R. Prac. 601-12. (Appendix 0.B). However, a written answer is useful to present to the court affirmative defenses and grounds for dismissal or summary judgment. The Forms Appendix includes form answers and motions for dismissal or summary judgment. These forms have been prepared as a counterpart to complaint forms available to landlords, also contained in the Forms Appendix. The tenant or tenant's attorney can check-off the defenses or grounds for dismissal or summary judgment which are applicable. A verified answer and motion for dismissal or summary judgment can serve as an answer, motion, and supporting memorandum and affidavit. Additionally, counsel should consider submitting proposed orders on issues of dismissal or summary judgment. Many of the orders in the Appendix were proposed orders submitted by the tenant's counsel.
A written answer may be needed to preserve the record for appeal. See Andrzijek v. Hall, No. C5-88-2134 (Minn. Ct. App. April 18, 1988) (unpublished decision: issue of trial court's refusal to allow defendant to present evidence of cause of disrepair and rent abatement not preserved for appeal where defendant did not file an answer, object, or request leave to file answer to conform to evidence). But see Christy v. Berends, No. A07-1451, 2008 WL 2796663 *2 (Minn.Ct. App. July 22, 2008) (unpublished) (failure to plead waiver of breach defense did not waive defense).
C. Third Party Practice and Joinder
In some cases, the alleged breach of the lease on the part of the tenant may have been caused by a third party. For instance, tenants with Section 8 Existing Housing Certificates or Vouchers pay part of the rent themselves, but the remaining rent is paid by a public housing authority. If the public housing authority withholds its subsidy or incorrectly calculates the subsidy, the landlord might file an unlawful detainer (eviction) action for nonpayment of rent against the tenant. The tenant may wish to bring a third party complaint in conjunction with the tenant's answer. However, since the time periods provided in Minn R. Civ. P. 14 are inconsistent with the summary nature of the unlawful detainer (eviction) action, the tenant should request that the court continue the action to allow the tenant to serve a third party complaint, and order an expedited period, such as seven (7) days, for the third party defendant to appear and respond. Additionally, dismissal may be appropriate for failing to include an indispensable party. See Wynmore Apartments v. Stellick, No. UD-1920513525 (Minn. Dist. Ct. 4th Dist. June 23, 1992) (Appendix 182) (tenant alleged failure to join HRA as indispensable party and alternative claim for a continuance to join HRA as a third party defendant where HRA miscalculated tenant's income and rent; action settled); Lilyerd v. Carlson, 499 N.W.2d 803, 807 (Minn. Ct. App. 1993) (defendant raised third party claim but did not notify or serve third party and apparently did nut pursue claim). See also Indispensable Parties, infra, at VI.D.14.
In Barry v. Lane, Nos. UD-1980629502 and UD-1980603900 (Minn. Dist. Ct. Sep. 15, 1998) (Appendix 310B), the total rent was $760, with the tenant's share of the rent being $257 and the Section 8 housing subsidy being $503. The court previously ordered a rent abatement of $500 per month, or 66% of the total rent and 195% of the tenant's share of the rent. The public housing authority apparently asserted that it was entitled to rent abatement beyond the tenant's share of the rent, but since it did not move to intervene, the court disbursed funds in escrow to the tenant. In CAMM Properties, Inc. v. Peacock, No. C6-97-1128, C7-97-1168, C9-97-1365, C2-97-1420 (Minn. Ct. App. May 18, 1998) (Appendix 316) (Unpublished), the defendant in an unlawful detainer action following default on a contract for deed moved to join an assignee of the mortgage as an involuntary party plaintiff to the action. The district court granted the motion, and later found that cancellation of the contract for deed was effective.
In some cases, affording complete relief to the tenant may require joining and indispensable party under Minn. R. Civ. P. 19. This may be more common in motions regarding disposition of property, where someone other than the plaintiff is retaining the property. See Lang v. Terpstra, No. UD-1940207512 at 2 (Minn. Dist. Ct. 4th Dist. June 12, 1994) (appendix 70) (storage company joined as necessary party on motion regarding property disposition).
D. Temporary Restraining Orders
1. Against tenant within eviction action
The court has the power to issue temporary restraining orders in unlawful detainer (eviction) actions. Berg v. Wiley, 264 N.W.2d 145, 151 (Minn. 1978); Yager v. Thompson, 352 N.W.2d 71, 74 (Minn. Ct. App. 1974). See generally Minn. R. Civ. P. 65. In Sentinel Management Co. v. Kraft, No. UD-1920806546 (Minn. Dist. Ct. 4th Dist. Aug. 12, 1992) (Appendix 11.I.3), the government subsidized housing project landlord served the tenant with the summons and complaint and motion for a temporary restraining order, which the landlord obtained the same day as service. The temporary restraining order evicted the tenant pending the hearing in the unlawful detainer action. The tenant moved for reconsideration of the temporary restraining order and for dismissal or summary judgment on the grounds that the landlord had failed to give the federally required eviction notice before commencing the action. The court vacated the temporary restraining order and dismissed the action. Minn. Stat. § 504B.325 (formerly § 566.051) also authorizes temporary relief by filing a harassment action under Section 609.748, or by filing a petition for a temporary restraining order in conjunction with an unlawful detainer (eviction) action.
2. Against landlord to prevent filing of eviction action
Tenants have had some recent success restraining landlords from filing unlawful detainer (eviction) actions. See McNair v. Doub, No. 1960708524 (Minn. Dist. Ct. 4th Dist. July 10, 1996) (Appendix 183) ( temporary retraining order in rent escrow action against landlord filing separate unlawful detainer action and allowing landlord to raise any unlawful detainer issue in a counterclaim, to protect the tenant from a tenant screening listing of an unlawful detainer action); Lumpkin v. Lewis, No. 96-10295 (Minn. Dist. Ct. 4th Dist. July 12, 1996) (Appendix 184) (temporary restraining order in consumer fraud action restraining landlord from filing a second unlawful detainer action, where landlord in a separate unlawful detainer action was denied rent due to housing conditions, and landlord said that he would file a new action for the same rent and try to bypass the judge from the first case; motion was supported by an affidavit from Sharlyn LaPlace of Person to Person on the effect of unlawful detainer actions on a tenant's record).
The court may continue the trial for up to six (6) days without consent of the parties; or, in certain circumstances, up to three (3) months for a material witness if a bond is paid. Minn. Stat. § 504B.341 (formerly § 566.08). While some courts regularly hold the trial at the initial appearance, others regularly will treat the initial hearing as an arraignment and schedule the trial at a later time or date. But see Minneapolis Public Housing Authority v. Demmings, No. C5-94-2045 (Minn. Ct. App. May 9, 1995), Finance & Commerce at 20 (May 12, 1995) (Appendix 159) (denial of continuance to obtain counsel upheld where result of trial would not have been different).
The court has discretion to continue the trial longer in the interests of judicial administration and economy. Rice Park Properties v. Robins, Kaplan, Miller and Cieresi, 532 N.W.2d 556 (1995); Thompson v. Stevens, No. C6-96-650 (Minn. Ct. App. Dec. 10, 1996), Finance and Commerce at 76 (Dec. 13, 1996) (Appendix 299) (Unpublished: followed Rice Park Properties).
A district court abuses its discretion by denying a motion to stay an eviction action when (1) an existing, separate district court action would be dispositive of the issues of possession and title to commercial real property involved in the eviction action and (2) the district court in the eviction action has concluded that some of the claims asserted in the first-filed action are essential to the defense of the eviction action. Bjorklund v. Bjorklund Trucking, Inc., 753 N.W.2d 312, 317-20 (Minn. Ct. App. 2008).
In Minneapolis Public Housing Authority v. _____, No. HC 1020213525 (Minn. Dist Ct. 4th Dist. Mar. 21, 2002) (Appendix 544), the parties agreed to a continuance of 19 days for trial. The landlord then sought another continuance beyond the date of a criminal trial concerning the tenant’s son, and when it could not locate a witness. When the court would not grant another continuance, the landlord moved to dismiss without prejudice. The court dismissed the action with prejudice, holding that a dismissal without prejudice would circumvent the statutory limitation on continuances to 6 days.
Minnesota Statutes § 325N.18 also requires the court to issue an automatic stay without imposition of a bond if a defendant makes a prima facie showing that the defendant has commenced an illegal foreclosure reconveyance action.
The Housing Court Rules provide for discovery. Minn. Gen. R. Prac. 612 (Appendix 0.B). Swanson v. Ivie, No. UD-1950411541 (Minn. Dist. Ct. 4th Dist. Apr. 21, 1995) (Appendix 171); Sage Mgmt. Co. v. Hughes, No. UD-1930129502 (Minn. Dist. Ct. 4th Dist. Feb. 23, 1993) (Appendix 0.E.1). The court also can sanction a party for not complying with a discovery order. Lynch v. Hart, No. UD-1960610529 (Minn. Dist. Ct. 4th Dist. Jun. 27, 1996) (Appendix 185) (tenants could not introduce evidence not in compliance with the discovery order). Before the Rules became effective, in Seward Handicap Housing Associates v. Wells, No. UD-1911002516 (Minn. Dist. Ct. 4th Dist. Oct. 16, 1991) (Appendix O.E), the court granted defendant's motion for expedited discovery, including the landlord's file on the tenant and a list of the landlord's witnesses and the facts on which they would testify. (Appendix 0.F). Counsel can argue that even outside of the Second and Fourth Judicial Districts, defendants are entitled to such basic information in order to prepare a minimal defense in the summary proceeding.
Given the expedited nature of discovery in an unlawful detainer action, if the landlord fails to comply with the discovery order, the tenant should argue that documents or testimony introduced at trial in violation of the discovery order should be excluded. Under Minn. R. Civ. P. 37.02(b), the court may refuse to allow the party who violated the discovery order to support or oppose certain claims or defenses, or prohibit that party from introducing designated matters into evidence. See Minneapolis Public Housing Authority v. Eberhardt, No. UD-1970204642 (Minn. Dist. Ct. 4th Dist. Mar. 17, 1997) (Appendix 275) (After admitting city chemist drug report conditionally during trial, court later excluded the report based on the landlord's violation of discovery order, delay in submission for testing, the small weight of the substance, and lack of testimony from the chemist); Larson v. Anderson, No. C9-96-416 (Minn. Dist. Ct. 9th Dist. Nov. 8, 1996) (Appendix 264) (attorney fees denied on motion to compel discovery).
In Stewart v. Anderson, No. A06-1878, 2007 WL 2366528 (Minn. Ct. App. Aug. 21, 2007) (unpublished), the housing court referee refused to accept the tenant’s documentary evidence while accepting the landlord’s documentary evidence, even though both parties failed to comply with the discovery order in a timely fashion. On appeal to the district court judge, the court reversed the housing court referee, finding that the referee erred by receiving the landlord’s late exhibits but refusing to receive the tenant’s late exhibits. On appeal to the Minnesota Court of Appeals, the Court affirmed the district court’s reversal of the housing court referee.
G. Housing Court: Ramsey and Hennepin Counties
In 1989 the Legislature provided for creations of housing courts in the Second sand Fourth Judicial Districts (Ramsey and Hennepin Counties). Minn. Stat. § 484.103. The Housing Court Rules went into effect on January 1, 1992. Minn. Gen. R. Prac. 600-12. (Appendix 0.B). The major changes from old Fourth Jud. Dist. Spec. R. Prac. 13 and 17 are that:
a. In holding over cases, the landlord must include the termination notice with the complaint or provide it to the tenant at the initial appearance, unless the landlord does not possess a copy of the notice or at the hearing the tenant acknowledges receipt of the notice, Minn. Gen. R. Prac. 604(c);
b. In breach of lease cases, the landlord must include with the complaint a copy of the lease or provide it to the tenant at the initial appearance, unless the landlord does not possess a copy of it, Rule 604(d);
c. The affidavit of service must contain the printed or typed name of the person who served the summons, Rule 605;
d. If the landlord does not file the affidavit of service by 3:00 p.m. three business days before the hearing, the court may, rather than must, strike the action, id.;
e. No written answer is required;
f. The court has more discretion in determining whether the tenant must pay into court withheld rent, and the amount that must be paid, Rule 608;
g. motions may be made orally or in writing, with the requirements of service of notice of motions and time periods in the Minnesota Rules of Civil Procedure not applying, Rule 610; and
h. that the parties shall cooperate with reasonable and formal discovery requests, and that upon the request of any party to a matter scheduled for trial, the court may issue an order for an expedited discovery scheduled, Rule 612.
A housing court referee shall preside over all hearings and trials concerning matters scheduled on the unlawful detainer (eviction) calendar. A party may remove the referee and request that a judge hear a case by filing a written request with the court administrator at least one day prior to the scheduled hearing date. Rule 602. It appears that the request must be filed one day before the initial hearing, rather than before a subsequent hearing. Amsler v. Harris, and Harris v. Amsler, Nos. UD-1990826901 and UD-1990902500 (Minn. Dist. Ct. 4th Dist. Sep. 24, 1999) (Appendix 376) (Notice of removal of judicial officer untimely.; Amsler v. Wright, No. UD-1960502510 (Minn. Dist. Ct. 4th Dist. May 30, 1996) (Appendix 186) (Court denied landlord’s untimely request to remove referee). A party also may remove a specific referee from a case, as can be done with judges assigned to cases, upon a written notice of removal. Minn. R. Civ. P. 63.03. The court then would assign the case to either another referee or a judge.
Orders and findings recommended by a referee become effective only when countersigned or confirmed by district court judge. A judgment based entirely on a referee's orders that have not been countersigned, reviewed or confirmed by a district court judge is unauthorized. Griffis v. Luban, 601 N.W.2d 712 (Minn. Ct. App. 1999).
In the Fourth District Court, First Division (Minneapolis), a hearing officer had presided over the initial appearance, and referred contested cases to the referee. Starting in the Fall of 1996, the Housing Court eliminated the hearing officer position and had the Housing Court Referee consolidate the arraignment and hearing calendars. Counsel should check in with the court clerk before the arraignment begins, since the order of cases is judge requests, defaults, settled cases, disputed cases with counsel, and disputed cases without counsel. See Memorandum to Housing Court Staff from Sue Daigle (Oct. 3, 1996) (Appendix 173). Beginning around December 16, 1996, housing court administrative services were divided into two offices, with one office on the skyway public service level handling unlawful detainer (eviction) case filings and public service information, and the eighth floor (and now the 17th floor) office handling other services. See Hennepin County District Court, Access, Filing & Information Are Moving (Appendix 174).
The initial appearance is at the "calendar call." When a case is called, the defendant will be asked whether the defendant admits or denies the charges in the complaint. A request for trial by jury must be made at that time, and the jury fee must be paid before the jury is impaneled. Contested cases shall be set for trial the same day as the initial hearing, if possible, or set on the first available calendar date. Rule 607. In the Fourth District Court, First Division, (Minneapolis), the unlawful detainer (eviction) calendar is scheduled for Tuesday through Friday mornings. If a trial cannot be heard at that time, the referee normally schedules the trial for Tuesday, Wednesday or Friday afternoons, or Monday morning or afternoon.
Rule 610 allows motions to be made orally or in writing at any time including the day of trial. Whenever possible, oral or written notice of any dispositive motions must be provided to all the parties prior to the hearing. All motions would be heard by the court as soon as possible. The court may grant a request for time to prepare a response to any motion for good cause or by agreement of the parties. The requirements of service of notice of motions and time periods in the Minnesota Rules of Civil Procedure do not apply.
Rule 612 provides that the parties shall cooperate with a reasonable and formal discovery request by another party. Upon the request of any party to a matter scheduled for trial, the presiding referee or judge shall issue an order for an expedite discovery schedule. Id.
See discussion, infra, Chapter IX.
Given the limited amount of time to prepare a defense, sometimes the tenant's attorney or advocate can prepare quicker by reviewing the court file before meeting with the tenant. The Fourth Judicial District Court (Hennepin County) issued a standing order waiving housing court photocopying charges to legal services attorneys and voluntary attorneys through the Legal Advice Clinic (now called Volunteer Lawyers Network (VLN)). Order Waiving Housing Court Photocopying Charges to Legal Services and Legal Advice Clinic Attorneys (Minn. Dist. Ct. 4th Dist. June 8, 1992) (Appendix 0.G).
Minn. Stat. § 484.013 provides for consolidation of actions:
Subd. 2. Jurisdiction. The housing calendar program may consolidate the hearing and determination of all proceedings under chapter 504B; criminal and civil proceedings related to violations of any state, county or city health, safety, housing, building, fire prevention or housing maintenance code; escrow of rent proceedings; and actions for rent abatement. A proceeding under sections 504B.281 to 504B.371 may not be delayed because of the consolidation of matters under the housing calendar program.
The program must provide for the consolidation of landlord-tenant damage actions and actions for rent at the request of either party. A court may not consolidate claims unless the plaintiff has met the applicable jurisdictional and procedural requirements for each cause of action. A request for consolidation of claims by the plaintiff does not require mandatory joinder of defendant's claims, and a defendant is not barred from raising those claims at another time or forum.
Rules for Conciliation Court are in Minn. R. Gen. Prac. 501 et. seq.
The parties are entitled to a full trial, and may demand a trial by jury. Minn. Stat. § 504B.335 (formerly § 566.07). See Gutsch v. Hyatt Legal Services, 403 N.W.2d 314, 315-16 (Minn. Ct. App. 1987) (damages action removed from conciliation court to district court: right to trial includes right to be heard, to produce witnesses and documents, to examine and cross-examine witnesses, to present arguments, and to have case decided on the merits). Given the large volume of cases in some courts, it is common for the courts to conduct the trial as a summary hearing at the bench, especially where both parties are unrepresented by counsel. Counsel should be careful to give notice to the court and the opposing party at the beginning of any summary discussion of the case that the right to a full trial is not being waived by such a discussion.
In Soukup v. Molitor, 409 N.W.2d 253, 254-55 (Minn. Ct. App. 1987), plaintiff and defendant settled an eviction (formerly unlawful detainer) action by agreeing to dismiss the action, and that if defendant defaulted on future rental payments, plaintiff could apply for a writ of restitution without further court action. Plaintiff later filed another unlawful detainer action alleging nonpayment of rent, holding over after notice, and breach of the lease. The trial court entered judgment for plaintiff without a trial. The Court of Appeals held that while the agreement may have waived defendant's right to a jury trial on the issue of nonpayment of rent, but it did not waive his right to a jury trial on all issues.
Landlords and tenants often submit public documents to support their cases, such as landlords submitting police reports in breach cases, and tenants submitting inspection reports in habitability cases. While both documents probably comply with the public records exception to the hearsay rule in Minn. R. Evid. 803(8), they still must be authenticated or be self-authenticating under Rules 901 and 902. State v. Northway, 588 N.W.2d 180 (Minn. Ct. App. 1999) (affirmed trial court exclusion of federal report which was not authenticated).
Hearsay statements within the report should be excluded unless they meet an exception to the hearsay rule. Countryview Mobile Home Park v. Oliveras, No. A04-160, 2004 WL 20049986 (Minn. Ct. App. Sept. 14, 2004) (unpublished) (affirmed from district court ruling sustaining objection to police report containing observations of officers who were not present in court); Minneapolis Public Housing Authority v. _____, No. HC 10306313566 (Minn. Dist Ct. 4th Dist. July 31, 2003) (Appendix 539) (Judge Doty) (landlord’s knowledge of alleged altercation was from a police report whose authors did not testify, and did not connect tenant to the incident).
Tenants and other lay witnesses have the right to testify about their observations of habitability problems. In Stewart v. Anderson, No. A06-1878, 2007 WL 2366528 (Minn. Ct. App. Aug. 21, 2007) (unpublished), the landlord filed a combination eviction action and onciliation court action in housing court, and the tenant answered alleging habitability. At trial, the tenant attempted to testify about her observations about how her dryer worked, and rodent infestation. The housing court referee did not accept her testimony, since she was not an expert in dryer repair or pest control. After the referee ruled for the landlord, the tenant sought review by a district court judge. The district court reversed the referee, finding that the referee erred by requiring expert testimony for lay testimony. On appeal, the Court of Appeals held that the district court correctly found that the referee had erred.
In limited circumstances, the court may require the defendant to post rent or other security as a precondition to a trial or to raising a defense.
1. Continuance beyond six (6) days for lack of a material witness: bond to cover rent which may accrue while the action is pending. Minn. Stat. § 504B.341 (formerly § 566.08). The court may require the rent to be paid into court as it becomes due. See discussion, supra, at V.E.
2. Retaliatory rent increase defense: payment to the court or the plaintiff of the pre-increase rent. Minn. Stat. § 504B.285 (formerly § 566.03), Subd. 3. See discussion, infra, at VI.E.9.
3. Breach of the covenants of habitability defense: payment of withheld rent into court or in escrow, or adequate security which is more suitable. Fritz v. Warthen, 298 Minn. 54, 61-62, 213 N.W.2d 339, 343 (1973). See discussion, infra, at VI.E.1.c.
4. Rule 608 provides that in any unlawful detainer (eviction) action where a tenant withholds rent and relies on a defense, "the defendant shall deposit forthwith an amount . . . . equal to the rent due as the same accrues or other such amount as determined by the court to be appropriate as security for the plaintiff, given the circumstances of the case." Rule 608 appears to require payment of rent as it "accrues", rather than the rent withheld prior to commencement of the action. While some courts require payment of past due rent as a condition to litigating a defense, this practice is of questionable validity, as well as bad public policy. See discussion, infra, at VI.E.1.C. In Ted Glassrud Assoc. v. Balsimo, No. C6-85-1821 (Minn. Ct. App. Oct. 1, 1985), the trial court required the defendant to post the full amount of past due rent alleged by the plaintiff, even though the defendant disputed the arrearage. The Court of Appeals granted a writ of prohibition, and remanded the case to the trial court for consideration of Minn. Stat. § 566.08 (now § 504B.341) (bond for continuances beyond six (6) days).
5. Combined actions for nonpayment of rent and breach of the lease: no payment unless the Court finds that the tenant owes rent. See discussion, supra and infra, at III., VI.E.20.c, VI.G.21.
The Fourth District (Hennepin County) Housing Court issued a May 15, 1996, Order approving acceptance of uncertified checks from Legal Aid and other law firms. The Housing Court retains discretion to decide whether to accept uncertified checks from social service agencies. It takes quite a bit longer for the Court to process and disperse uncertified funds, so if quick dispersal of funds is important to the tenant, the tenant or tenant's attorney should submit funds by certified check. (Appendix 174(A).
J. Exceptions to the Unauthorized Practice of Law (except for jury trials and appeals)
An authorized management company or agent may commence and conduct the action in its own name or on behalf of the owner of the property. Minn. Stat. § 481.02, subd. 3(12). The tenant or landlord may be represented by a person who is not a licensed attorney. Minn. Stat. § 481.02, subd. 3(13). See Letter from Honorable Thomas F. Haeg, 4th District Housing Court Referee, to Sherry Coates (July 13, 1994) (Appendix 25).
However, except for a nonprofit corporation, a person who is not a licensed attorney-at-law shall not charge or collect a separate fee for services in representing a party. Id. Some for profit businesses represent plaintiffs in actions and charge a separate fee for such representation. Defendant should move to dismiss the action. See Standing Order Regarding Court Appearances by Non-attorney Non-managing Agents, C4-90-11340 (Minn. Dist. Ct. 2nd Dist. June 9, 1995) (Appendix 84) (person and company which admitted that a non-attorney, non-managing agent collected fees for filing and maintaining unlawful detainer (now called eviction) actions were prohibited from filing and maintaining such actions).
Corporations, limited partnerships, and limited liability companies must be represented by an attorney. Nicollet Restoration, Inc. v. Turnham, 486 N.W.2d 753 (Minn. 1992) (Corporation); Westfalls Housing Ltd. Partnership v. Scheer, No. C8-93-227 (Minn. Dist. Ct. 5th Dist. Nov. 30, 1993) (limited partnership) (Appendix 26); Remas Properties, LLC v. Student, No. UD-1940705517 (Minn. Dist. Ct. 4th Dist. July 19, 1994)(limited liability co.) (Appendix 27). See discussion, infra, VI.D.7 (unauthorized practice of law defense).
It is not uncommon for the plaintiff to raise additional issues not pleaded in the complaint at the initial hearing or trial. The court should not hear such additional issues, since:
1. The summary nature of the action and Minn. Stat. § 504B.285 (formerly § 566.03), subd. 1 require specificity in pleading, see discussion, infra, at VI.D.6, and
2. The plaintiff may be entitled to restitution based only upon the unlawful possession alleged in the complaint. See Mac-Du Properties v. LaBresh, 392 N.W.2d 315, 318 (Minn. Ct. App. 1986).
In Langenberger v. Moss, Partial Transcript, UD-1950912529 (Minn. Dist. Ct. 4th Dist. Sept. 28, 1995) (Appendix 85), the Court denied the landlord's motion to amend the complaint to add an additional issue. The Court noted that while an unlawful detainer (eviction) action is a summary proceeding where parties often appear without counsel, the parties are expected to be prepared for trial and obtain counsel ahead of time if necessary. In Northern Management, Inc. v. Bade, C9-94-3915 (Minn. Dist. Ct. 7th Dist. Nov. 25, 1994) (Appendix 86), the Court denied the landlord's motion to amend the complaint of breach of lease to include alleged lease violations occurring after the landlord filed the action. The Court held that only matters detailed in the complaint may be considered in the action. See Valley Investment & Management, Inc. v. _______, No. HC 000927525 (Minn. Dist Ct. 4th Dist. Nov. 1, 2000) (Appendix 589a) (14 day notice requirement for termination of month to month tenancy for nonpayment of rent in Minn. Stat. § 504B.135 (formerly § 504.06) is not required for a nonpayment of rent eviction action; landlord’s acceptance of part payment without a written agreement to retain an eviction claim for the balance waives the eviction claim; plaintiff cannot amend complaint once defendant has served an answer); Brooklyn Park Housing Associates I, LLP v. _____, No. HC 1010124505 (Minn. Dist Ct. 4th Dist. Feb. 7, 2001) (Appendix 482) (landlord may pursue claim for part payment of rent only if there is a written document reserving that right; landlord may amend complaint to claim current rent claim not waived by part payment, with tenant retaining right to redeem); Hurt v. Johnston, No. HC-000103513 (Minn. Dist. Ct. 4th Dist. Jan. 14, 2000) (Appendix 398) (Landlord's motion to amend complaint denied and action dismissed where landlord failed to attach the lease to the complaint to support a claim of breach of lease, and the landlord's claims of breach by unsanitary conditions in that tenant knew information about the landlord required by statute to be disclosed to the tenant were not pled with sufficient specificity).
The defendant in an unlawful detainer (eviction) action is given very little time to prepare a response and it is essential that they are given both sufficient notice of the allegations and adequate time to prepare a defense. Allowing matters arising after the date of filing of the complaint would severely prejudice a tenants ability to prepare an adequate defense. On the other hand, very little prejudice results to a plaintiff, as the plaintiff is free to file a new action in unlawful detainer (now called eviction) based on any violations which may occur after the filing of an unlawful detainer action. Id. at 6. See Lynch v. Hart, No. UD-1960610529 (Minn. Dist. Ct. 4th Dist. Jun. 27, 1996) (Appendix 185) (landlord could not introduce evidence about lease violations not included in the complaint of non-payment of rent).
In Public Housing Agency of City of St. Paul v. Simpkins, No. C7-97-2137 (Minn. Dist. Ct. 2d Dist. Jan. 30, 1998) (Appendix 359) (Faricy, J.), the public housing authority gave the tenant a 14 day non-payment of rent notice for $25.00. The tenant then paid the rent and a late fee. However, the PHA applied the payments to an alleged arrearage for previous months, and filed an unlawful detainer action claiming non-payment of the February rent. The referee allowed the PHA to orally amend its claim, and ordered the tenant to pay $209 and court costs within seven days or move. The tenant moved and later obtained bank verification of deposit of the tenant's payment. The tenant moved to vacate the judgment, which was first denied by another referee, and then granted on judge review. The court concluded the first referee erred by going beyond the pleadings and ordering the tenant to pay more than had been pled, and the second referee erred in denying the motion to vacate. The court noted that it would be unjust to evict another tenant who moved into the unit vacated by the tenant, so the court ordered the PHA to place the tenant's name immediately at the top of the waiting list for the next available vacancy without requiring her to address claims for past due rents.
On the other hand, the courts in some cases have allowed the landlord to amend the complaint where the amendment allegedly does not prejudice the tenant. This occurs most often where the landlord has claim nonpayment of rent and the case extends into the next month. See Lowe v. Cotton, No. UD-01990224515 (Minn. Dist. Ct. 4th Dist. Oct. 7, 1999 (Appendix 404) (Breach of lease claim dismissed where there was no written lease, parties recently entered into a written agreement that defendant would not have a pet but the memo did not include a right of reentry; plaintiff granted leave to amend complaint for nonpayment of rent as defendant admitted the claim; landlord agreed to give tenant eight days to redeem.; Phoenix Group, Inc. v. Phonseya, UD-1951004-508 (Minn. Dist. Ct. 4th Dist. Nov. 1, 1995) (Appendix 87) (court considered November rent in case filed in October, where decision was issued in November); BRI Associates v. Gangl, C4-95-845 (Minn. Dist. Ct. 10th Dist. Apr. 24, 1995) (Appendix 88) (landlord allowed to amend case caption to avoid trade name registration penalty). But see Ridgewood Arches v. Williams, No. UD-1950201501 (Minn. Dist. Ct. 4th Dist. Feb. 22, 1995) (Appendix 165) (complaint alleged only breach of lease, landlord testified about rent due; court found against landlord on breach claim and noted that the parties could resolve the rent issue independent of the court).
While the summary nature of the action argues against allowing the plaintiff to amend the complaint, should the court allow amendment, it should require the same period of notice to the defendant, as if the plaintiff had commenced another action.
L. Summary Judgment and Dismissal
Counsel for defendants often seek summary judgment and dismissal of the action before trial. Some counsel for plaintiffs also move for summary judgment. Federal Land Bank of St. Paul v. Obermoller, 429 N.W.2d 251 (Minn. Ct. App. 1988). Even if state or local district court rules place time requirements on such motions that are inconsistent with the unlawful detainer (now called eviction) statute, counsel should pursue and the court should entertain summary judgment and dismissal where (1) there are no genuine issues as to any material fact, (2) judgment must be ordered for one party as a matter of law, (3) the opposing party is not prejudiced from lack of notice or other procedural irregularities, and (4) the opposing party had a meaningful opportunity to respond to the motion. Id. at 254-55. See DePetro v. DePetro, No. A03-727, 2004 WL 885552 (Minn. Ct. App. April 27, 2004) (unpublished) (affirmed eviction summary judgment for plaintiff under doctrine of collateral estoppel, where plaintiff was unable to execute writ of recovery in first eviction action and commenced second eviction action on the same grounds and defendant did not raise any new claims or defenses); Bjur v. Burgmeier, No. C2-92-409 (Minn. Ct. App. Aug. 21, 1992) (unpublished: summary judgment for plaintiff) (Appendix O.H.. In Housing Courts in Hennepin and Ramsey Counties, Rule 610 deletes the time requirements for a motion practice in other rules.
In CAMM Properties, Inc. v. Peacock, No. C6-97-1128, C7-97-1168, C9-97-1365, C2-97-1420 (Minn. Ct. App. May 18, 1998) (Appendix 316) (Unpublished), the defendant in a contract for deed unlawful detainer action raised the issue of which of several parties had the vendor's interest in the property. The trial court granted summary judgment for the plaintiffs, concluding that collateral estoppel and res judicata barred her from arguing issues which she raised in an earlier action against plaintiffs. The court affirmed the decision, concluding that the district court did not err in granting summary judgment.
The summary nature of the action does not relieve the court of the obligation to find facts specially and state separately its conclusions of law. MCDA v. Mark Lee Productions, Inc. 411 N.W.2d 599, 601 (Minn. Ct. App. 1987) (citing Minn. R. Civ P. 52.01). Failure to include findings usually requires reversal, unless the decision necessarily decides all disputed facts, or the undecided issues are immaterial. Id. See Gear Properties v. Jacobs, No. C1-97-2266, 1998 WL 550762 (Minn. Ct. App. Sep. 1, 1998) (unpublished) (Appendix 322) (in nonpayment of rent case, no further findings were required beyond that complaint was true); Northstar Estates Manufactured Home Community v. Thompson, No. C3-98-2005 (Minn. Ct. App. April 22, 1999) (unpublished opinion which shall not be cited as precedent)(District Court, which was not alerted to application of § 327C.02, erred in its determination of material breach because of rule violations where the court made no findings as to the reasonableness of rules or whether the rules substantially modified a prior agreement, and the residents were not given ten days to comply with the rule by the court; district court reversed..
The Court of Appeals also may remand the action to the trial court for further findings. Nicollet Towers, Inc. v. Georgiff, C5-94-1364 (Minn. Ct. App. Feb. 7, 1995), Finance and Commerce 53 (Feb. 10, 1995) (Appendix 89); Minneapolis Public Housing Authority v. Holloway, C0-94-736 (Minn. Ct. App. Nov. 15, 1994), Finance and Commerce 36 (Nov. 18, 1994) (Appendix 90) Finance and Commerce 36 (Nov. 18, 1994) (Appendix 90); Housing and Redevelopment Authority of Winona v. Fedorko, C4-94-884 (Minn. Ct. App. Nov. 22, 1994), Finance and Commerce 43 (Nov. 25, 1994) (Appendix 91). Counsel should consider preparing proposed orders to accompany motions for dismissal or summary judgment (Appendix 5.H), or after trial.
N. Collateral Estoppel and Res Judicata
An unlawful detainer (now called eviction) judgment does not prevent the tenant from raising in another action:
1. An issue which could have been raised in the unlawful detainer (now called eviction) action, but was not raised, or was raised but later withdrawn, Steinberg v. Silverman, 186 Minn. 640, 642, 244, N.W. 105, 105-106 (1932).
2. An issue raised in the eviction (unlawful detainer) action which the court declined to rule on. See Seifred v. Zabel, 369 N.W.2d 571, 574 (Minn. Ct. App. 1985).
3. Issues of title. Pushor v. Dale, 242 Minn. 564, 568-69, 66 N.W.2d 11, 14 (1954); Hargreaves v. FDIC, No. C9-89-1966 (Minn. Ct. App. June 15, 1990) Finance & Commerce at B12 (July 15, 1990) (unpublished).
While the summary nature of the eviction (unlawful detainer) action limits its collateral estoppel effect, Cole v. Paulson, 380 N.W.2d 215, 218 (Minn. Ct. App. 1986), the judgment is conclusive of the facts upon which the right of possession rested. Id. at 218-19 (tenant barred from re-litigating adequacy of notice). See Gollner v. Cram, 258 Minn. 8, 10-13, 102 N.W.2d 811, 820 (1960), cert. denied, 364 U.S. 894 (tenant barred from re-litigating breach and waiver of breach); Wurdemann v. Hjelm, 257 Minn. 450, 464, 102 N.W.2d 811, 820 (1960), cert. denied, 364 U.S. 894 (tenant barred from re-litigating breach and waiver of breach); Ferch v. Hiller, 210 Minn. 3, 7-8, 297 N.W. 102, 104 (1941) (defendant barred from re-litigating cancellation of a contract for deed); _____ v. Tran, No. AC-03-13965 (Minn. Dist Ct. 4th Dist. Nov. 19, 2003) (Appendix 456) (repairs litigated in previous emergency relief action cannot be relitigated in subsequent action for property damage; landlord claiming tenant damage must prove the condition of the property when the tenant moved to the property, and a connection between repairs and tenant damage; landlord failed to comply with security deposit statute).
The Court in the eviction (unlawful detainer) action also can specifically state which issues were litigated, and direct the parties to not attempt to re-litigate the issues in another form. Ochoa v. Kenneth, UD-1950919505 (Minn. Dist. Ct. 4th Dist. Oct. 20, 1995) (Appendix 79) (landlord may not pursue litigated rent claim in conciliation court or by security deposit setoff); Lewis Properties v. Pruitt, UD-1950315516 (Minn. Dist. Ct. 4th Dist. Sept. 22, 1995) (Appendix 92) (landlord may not claim litigated rent against tenants' security deposit); The Hornig Company v. Mmubango, UD-1950213513 (Minn. Dist. Ct. 4th Dist. Mar. 6, 1995) (Appendix 93)(landlord may not raise litigated rent claim in conciliation court, but damage claim was not determined).
"If, however `the judgment might have been based upon one or more of several grounds, but does not expressly rely upon any one of them, then none of them is conclusively established under the doctrine of collateral estoppel, since it is impossible for another court to tell which issue or issues were adjudged by the rendering court.'" Hauser v. Mealey, 263 N.W.2d 803, 808 (Minn. 1978), quoting 1 B. Moore's Federal Practice at 3915 (2d ed. 1948).
In an eviction (unlawful detainer) action based upon nonpayment of rent, a judgment for the plaintiff on default or where the defendant did not raise breach of the covenants of habitability, does not bar a subsequent action for breach of the covenants. Mayse v. Nordlie, No. 84-13390 (Minn. Dist. Ct., 4th Dist., 1985) (Appendix 1).
In Ellis v. Minneapolis Commission on Civil Rights, 319 N.W.2d 702, 704 (Minn. 1982), the Court held that the issue of illegal discrimination, which was litigated in an eviction (unlawful detainer) action, could not be litigated in a subsequent discrimination action. The Court noted that in the unlawful detainer action, the proceeding was not summary in nature, where the tenant had significantly more time to prepare than in the typical case, the tenant introduced extensive evidence, and the jury trial lasted for four days. The court concluded that "[i]n this unique fact situation, [the tenant] had a full and fair opportunity to litigate [the issue]." See Jacobs v. Gear Properties, No. 00-1257MN, 2001 WL 87440 (8th Cir. Feb. 2001) (unpublished) (affirmed dismissal of federal court action claiming discriminatory eviction following loss in state court eviction action where tenant did not raise discrimination, on the grounds that discrimination could have been raised in the eviction).
In Russell v. Popper, 914 F.2d 1494 (6th Cir. 1990), the Sixth Circuit Court of Appeals affirmed dismissal of a housing discrimination suit filed by a tenant who unsuccessfully raised identical allegations in a state court eviction proceeding. The Court of Appeals concluded that the tenant had a full and fair opportunity to litigate her discrimination claim. But see Seifred, 369 N.W.2d at 574 (discrimination raised but not ruled upon does not bar subsequent discrimination action). For a general discussion of whether litigation of discrimination in eviction actions bars later litigation by a government agency, see Memorandum of Harry L. Carey, (Appendix 407).
In Huffman v. Ellis, No. UD-1991119518 (Minn. Dist. Ct. 4th Dist. Feb. 2, 2000) (Appendix 397), the parties settled an unlawful detainer action for nonpayment of rent with habitability defenses for rent abatement and a deadline to complete repairs. When the landlord did not complete repairs by the deadline, the tenant moved for relief based on breach of the settlement agreement. The court found the breach of the agreement, diminished use of enjoyment of the premises, and awarded rent abatement. After taking testimony on damage to the tenant's car allegedly caused by repair problems not contemplated in the settlement agreement, the court concluded that the damages were excluded from rent abatement and would not be considered res judicata as to future claims.
However, there may be some issues which should have been litigated in the eviction (unlawful detainer) action which cannot be litigated later in a separate damages action. In Duling Optical Corp. v. First Union Management, Inc., No. C5-95-2718 (Minn. Ct. App. Aug. 13, 1996), Finance & Commerce at 66 (Aug. 16, 1996) (Appendix 181) (unpublished decision), the Court of Appeals affirmed the District Court’s conclusion in a separate damages action that it lacked jurisdiction to award attorney’s fees for separate unlawful detainer actions, since the issue of attorney’s fees should have been decided in the unlawful detainer actions. But see In Eagan East Ltd. Partnership v. Powers Investigations, Inc., 554 N.W. 2d 621 (Minn. Ct. App. 1996) (trial court’s jurisdiction was limited to determining present possessory rights of the parties, and that the trial court exceeded its jurisdiction by ruling on a prospective rent increase and attorney’s fee issues).
A landlord who brought second unlawful detainer action to correct errors made in first unlawful detainer action over the same subject matter was not barred by lack of jurisdiction while the first case was appealed, or collateral estoppel since unlawful detainer actions have limited collateral effect. Jordan v. Peterson, No. C7-96-1757 (Minn. Ct. App. Mar. 18, 1997, Finance and Commerce at 49 (Mar. 21, 1997) (Appendix 263) (Unpublished). In CAMM Properties, Inc. v. Peacock, No. C6-97-1128, C7-97-1168, C9-97-1365, C2-97-1420 (Minn. Ct. App. May 18, 1998) (Appendix 316) (Unpublished), the defendant in a contract for deed unlawful detainer action raised the issue of which of several parties had the vendor's interest in the property. The trial court granted summary judgment for the plaintiffs, concluding that collateral estoppel and res judicata barred her from arguing issues which she raised in an earlier action against plaintiffs. The court affirmed the decision, concluding that the district court did not err in granting summary judgment. See Franklin v. Rae, No. HC-000121503 (Minn. Dist. Ct. 4th Dist. Feb. 4, 2000) (Appendix 392) (Judge Albrecht: dismissal based on res judicata) (Memorandum by Paul Birnberg attached arguing that dismissal was on the merits under Minn. R. Civ. P. 41.02).
A second eviction action brought on grounds different from the first is not barred. Anoka County Community Action Program v. Solmonson, No. A05-1251, 2006 WL 1320332 (Minn. Ct. App. May 16, 2006) (unpublished) (res judicata did not apply to second eviction case where first case involved different grounds, and was dismissed by plaintiff voluntarily). On the other hand, a second action brought on the same grounds as the first where the landlord could not enforce the writ of recovery in a timely manner is not barred, and summary judgment for the landlord may be appropriate where the tenant has no new defenses to raise in the second action. See DePetro v. DePetro, No. A03-727, 2004 WL 885552 (Minn. Ct. App. April 27, 2004) (unpublished)(affirmed eviction summary judgment for plaintiff under doctrine of collateral estoppel, where plaintiff was unable to execute writ of recovery in first eviction action and commenced second eviction action on the same grounds and defendant did not raise any new claims or defenses).
Minnesota law encourages a settlement of disputes and generally presumes the validity of releases of claims. Since a release is a contract, interpretation of the release is a question of law, governed by principles of contract construction. The Regents of the University of Minnesota v. Scheurer, No. C2-99-1065 (Minn. Ct. App. Dec. 28, 1999) (unpublished) (The general release in the parties' unlawful detainer settlement agreement discharged all claims and liabilities, not just housing related claims..
O. Removal of Action to Federal Court
When the claims of the plaintiff or defendant involve federal law, the defendant may be able to remove the case to federal court. For example, the Civil Rights Removal Statute, 28 U.S.C. § 1443(1) allows removal of the action to federal court where the defendant asserts that the action was motivated by a discriminatory purpose or in retaliation for the exercise of the defendant's rights to challenge discrimination. See Defendant's Memorandum In Opposition to Plaintiff's Motion to Remand, Bossen Terrace v. Ewing, No. 4-91-Civ. 824 (D. Minn. Nov. 6, 1991) (discussion of cases; action settled in federal court) (Appendix 28).
P. Release from Prison for Hearing
The Court may order the release of an institutionalized person to appear at an eviction (unlawful detainer) action, under Minn. Stat. § 589.35. Minneapolis Public Housing Authority v. Harding, No. UD-1941011532 (Minn. Dist. Ct. 4th Dist. Oct. 26, 1994)(Appendix 29).
In 1994, the Legislature created a priority in scheduling for cases including claims of illegal drugs under Section 504.181 (now § 504B.171), or on the basis that the tenant is causing a nuisance or seriously endangering the safety of other residents, their property, or their landlord's property. The priority includes scheduling appearances at the arraignment, scheduling trials, and issuing and executing Writs of Restitution. The court also may not stay issuance of the Writ of Restitution in such cases. Minn. Stat. § 504B.321 (formerly § 566.05), 504B.335 (formerly § 566.07), 504B.345 (formerly § 566.09), 504B.361 (formerly § 566.16), 504B.365 (formerly § 566.17), amended by 1994 Minn. Laws. Ch. 502, §§ 4-9.
In 1997 the Legislature replaced the priority for scheduling cases involving claims of illegal drugs with a process for bringing expedited actions involving illegal drugs, prostitution related activities, certain firearm possession offenses, or nuisance or other illegal behavior that seriously endangers the safety of other residents, their property, or the landlord's property. Minn. Stat. § 504B.321 (formerly § 566.05), amended by 1997 Minn. Laws Ch. 239, Art. 12, section 5 (Appendix 242). The person filing the complaint must file an affidavit stating specific facts and instances to support it, and explain why an expedited hearing is required. A referee or judge must review the complaint and affidavit to determine whether an expedited hearing is justified. The court must schedule a hearing in not less than five days or more than seven days from the date the summons is issued. A summons must be served within 24 hours of issuance unless the court orders otherwise for good cause. If the court determines that the person seeking an expedited hearing did so without sufficient basis, the court must impose a civil penalty of up to $500 for abuse of the process.
It is unclear what the court will do if at the expedited hearing the landlord cannot prove the basis for the expedited hearing, but can prove a lease violation. The tenant should argue for assessment of the $500 penalty, but also ask that the case be dismissed for not meeting the jurisdictional requirement for an expedited hearing. Without such relief, there would be little disincentive for landlords to characterize breach of lease cases as expedited hearing cases.
Most unlawful detainer actions which are contested initially later result in settlement. Settlements can include many issues, including those which could not be resolved if the case were contested. Counsel should include deadlines for action to be taken by the landlord. For instance, if there is agreement on a reference letter, counsel should accept a deadline for drafting the letter, and include a deadline for the landlord to sign and return it. Shatek v. Kneeland, No. UD-1970306507 (Minn. Dist. Ct. 4th Dist. Mar. 26, 1997) (Appendix 292) (Settlement for payment of rent, security deposit refund without deductions, reference, schedule for completing the reference letter, writ of restitution if tenant violates agreement, trial if landlord violates agreement). See Grimmer v. Svoboda, No. UD-1960923520 (Minn. Dist. Ct. 4th Dist. Jan. 6, Jan. 15, and Mar. 14, 1997) (Appendix 257) (Writ stayed where landlord failed to execute stipulated reference, told tenants they could stay longer, and accepted rent beyond the move out date; landlord ordered to execute reference letter and tenant given extra month to move; damages and move out date settled).
Landlords occasionally include in settlement agreements provisions on future payments of rent. While the landlord may obtain a writ and evict the tenant for failing to make installment payments on back rent, the landlord must file a new action if future rents are not paid. See discussion, infra, at VIII.B.2.
The court retains the right to approve or not approve a settlement, and in some cases may not approve provisions unfavorable to a tenant that the tenant had agreed to follow. Minneapolis Public Housing Authority v. Taylor, No. UD-1961211526 (Minn. Dist. Ct. 4th Dist. Mar. 20, 1997) (Appendix 281) (Settlement for two and one half months to move, 10-day notice of exact date to move, neutral reference, dismissal, and cancellation of agreement; court struck provision requiring tenant to exclude her minor daughter from the property).
Counsel should consider contempt as a method for enforcing settlement agreements. See discussion, infra, at VII.C.
Minnesota law encourages a settlement of disputes and generally presumes the validity of releases of claims. Since a release is a contract, interpretation of the release is a question of law, governed by principles of contract construction. The Regents of the University of Minnesota v. Scheurer, No. C2-99-1065 (Minn. Ct. App. Dec. 28, 1999) (unpublished) (The general release in the parties' unlawful detainer settlement agreement discharged all claims and liabilities, not just housing related claims).
The maintains jurisdiction over the case to enforce the settlement. In Huffman v. Ellis, No. UD-1991119518 (Minn. Dist. Ct. 4th Dist. Feb. 2, 2000) (Appendix 397), the parties settled an unlawful detainer action for nonpayment of rent with habitability defenses for rent abatement and a deadline to complete repairs. When the landlord did not complete repairs by the deadline, the tenant moved for relief based on breach of the settlement agreement. The court found the breach of the agreement, diminished use of enjoyment of the premises, and awarded rent abatement. After taking testimony on damage to the tenant's car allegedly caused by repair problems not contemplated in the settlement agreement, the court concluded that the damages were excluded from rent abatement and would not be considered res judicata as to future claims. Patterson v. Heinecke, No. C3-00-600301 (Minn. Dist. Ct. 6th Dist. Mar. 24, 2000) (Judge Oswald) (Appendix 412) (Writ vacated where the parties settled for payment of back rent but plaintiff refused to cooperate; plaintiff ordered to immediately cooperate with defendant to provide forms necessary to obtain rental assistance from the Salvation Army. "This Court is not going to act as Plaintiff's rent collection agency nor is it going to allow Plaintiff's own refusal to cooperate to frustrate the prior settlement of the parties).
Occasionally court personnel may be reluctant to expunge a court file where there is a settlement agreement setting out actions or events that will occur in the future. The tenant should ask the court to order that expungement occur immediately. This is especially important during a period in which the tenant is seeking new housing. Viking Properties of MN LLC v. Wesley, Nos. UD-1990714563 and UD-1990709901 (Minn. Dist. Ct. 4th Dist. Aug. 11, 1999) (Judge Rosenbaum) (Appendix 421) (Action to be expunged immediately upon filing of order where unlawful detainer action was erroneously filed due to mistake or confusion; settlement providing that tenant would move in one and one-half months, tenant would not pay rent for two months and landlord would retain deposit plus interest, landlord would provide neutral reference, landlord would make repairs as ordered by the housing inspector, landlord would give 24 hours written notice of intention to make repairs, tenant would accommodate repair persons, landlord could contact tenant's community liaison except all repair notices would be between the parties, the agreement did not waive other rights related to nuisance, illegal or criminal conduct, privacy, or discrimination, tenant would not pursue claims for rent abatement, landlord would not pursue claims for past rent, deposit, late fees, court costs, or court fees, the parties did not admit liability).
Counsel should consider the following issues for settlement:
1. Rent and fees: rent abatement for disrepair; scheduling rent abatement in installments to conform to government benefit program income or asset requirements; landlord rent abatement payment by lump sum or installment payments with interest; waiver or limitation of back or future rent or utility charges; waiver of late, service and filing fees; extension and/or payment plan to pay rent or other fees; rent abatement to enforce a lockout penalty; suspension of government subsidy to landlord pending repairs; recalculation of subsidized housing income, rent and government subsidy; waiver of side payments (charges or fees not authorized by subsidized housing programs); assessment of $250 in costs for failing to register trade name with Secretary of State; damages; tenant retains potential tort claim;
2. Repairs: schedule for repairs; landlord will comply with inspection orders; apartment reinspection; landlord enjoined from filing any unlawful detainer actions for nonpayment of rent until after repairs have been made;
3. Housing: relocation and relocation benefits during apartment remodeling; landlord will put tenant in suitable replacement housing and provide money for food until hearing; landlord will provide habitable replacement housing with kitchen facilities; landlord's relocation of tenant to another property which would pass Section 8 inspection, and landlord and tenant will sign Section 8 lease at new apartment;
4. Tenant and landlord conduct: reasonable accommodation of the tenant's disability; mediation between the landlord, landlord staff, tenant and/or neighbors; changes in how a landlord, landlord staff, tenant and/or neighbors deal with each other; probation period for the tenant; extended period for tenant to comply with the lease or government codes; exclusion of certain guests; mutual non-harassment order; notice of landlord visits; pets; tenant will not be noisy and landlord will take action against other noisy tenants; tenant agrees not to damage property; limitation on residents but not guests;
5. Future agreements: executing a contract for deed or other contract; executing a lease; executing subsidized housing contracts;
6. Moving: lease termination notice; landlords allows tenant to terminate lease; tenant can move out with one month's notice; extended period to move and/or extended stay of issuance of the Writ of Restitution; scripted favorable or non-negative reference to prospective landlords and to tenant screening agencies and process for preparing and circulating reference; tenant will clean old apartment; disposition of security deposit and interest; landlord will return security deposit or provide itemized list of damages in ten days with an evidentiary hearing if tenant disputes landlord's determination;
7. Other: explanation of the dispute between the parties; apologies by the parties; extension of the period in which a notice quit by the landlord would be presumed to be retaliatory; retraction of eviction notices;
8. Enforcement: notice to the tenant and tenant's advocate of landlord's allegation that tenant has violated the settlement agreement and landlord's seeks the writ of restitution, with opportunity for the tenant to request a hearing to challenge the allegation; agreement admissibility in other actions; agreement enforcement; confession of judgment; waiver of other claims if parties comply with agreement, and re-opening of action if parties violate agreement; continuing jurisdiction;
9. Case disposition: dismissal of the unlawful detainer action; judgment; sealing or expunging court records.
The following settlement agreements address many of these issues:
1. Amended Settlement & Release, Smith v. Meyer, No. UD-1940804538 (Minn. Dist. Ct. 4th Dist. Oct. 3, 1994) (rent escrow action settlement; rent abatement in installments to conform to government benefits program, favorable reference, rent-free occupancy, extended vacate date, liability releases, and continuing jurisdiction) (Appendix 30).
2. Clark v. Johnson, No. UD-1940720506 (Minn. Dist. Ct. 4th Dist. Aug. 5, 1994) (rent paid into court released to plaintiff, extended vacate date, waiver of additional rent, limitation of utility bill liability, and favorable reference) (Appendix 31).
3. Settlement & Agreement Lisk v. McGee, No. 1940811500 (Minn. Dist. Ct. 4th Dist. Aug. 18, 1994) (rent payment, waiver of filing fee, vacate date, pro rata rent for last month, return of security deposit, favorable reference, and dismissal) (Appendix 32).
4. Bratton v. Dockery, No. UD-1940912513 (Minn. Dist. Ct. 4th Dist. Sep. 30, 1994) (payment plan for rent and filing fee) (Appendix 33).
5. Settlement Agreement between Bethune Associates, Parkview Apartments, and Derrell Woodard (Oct. 20, 1994) (schedule for rent payment, parties' cooperation in excluding a non-resident, retraction of eviction notices, admissibility of settlement agreement, and enforcement) (Appendix 34).
6. Settlement Agreement, Minneapolis Public Housing Authority v. Patterson, No. UD-1940511538 (Minn. Dist. Ct. 4th Dist. May 31, 1994) (probation) (Appendix 35).
7. Ehlart v. Billat, No. 24-C794-956 (Minn. Dist. Ct. 3rd Dist. Sep. 30, 1994) (extension to pay rent, taxes and insurance, entry into contract for deed, and dismissal) (Appendix 36).
8. Public Housing Authority v. Vang, UD-1951003612 (Minn. Dist. Ct. 4th Dist. Oct. 17, 1995) (Appendix 94) (tenant already paid all of the rent, landlord's records were inaccurate, and landlord apologizes to tenant).
9. _______ v. _______, C3-94-211 (Minn. Dist. Ct. 5th Dist. Dec. 21, 1994) (Appendix 95) ($500 in lockout damages prospectively applied to rent, schedule for repairs, and confession of judgment, tenant cooperation with landlord for completing repairs, extension of 90 day retaliatory eviction presumption under Minn. Stat. § 566.28 (now § 504B.441)).
10. Wynmore Apartments v. Stellick, No. UD-1920513525 (Minn. Dist. Ct. 4th Dist. June 23, 1992) (Appendix 182) (housing authority shall pay increased subsidy after miscalculating tenant's income and rent; $250 penalty for failing to register trade name; waiver of late fees; waiver of side payments or fee charged in excess of amounts stated in lease; waiver of ½ of the filing fee; payment plan for back rent).
11. Grimmer v. Svoboda, No. UD-1960923520 (Minn. Dist. Ct. 4th Dist. Oct. 29, 1996) (Appendix 188) (extended time to move; $250 penalty for failing to register trade name of the plaintiff's management company to be paid from rent paid into court; mutual non-harassment order; 48 hours written notice for landlord visits, containing date, time and duration for visit; non-interference with tenant's access to garage; neutral reference letter with specific statements and limitations; process for resolution of disputed claims to personal property in garage); Grimmer v. Svoboda, No. UD-1960923520 (Minn. Dist. Ct. 4th Dist. Jan. 6, Jan. 15, and Mar. 14, 1997) (Appendix 257) (Writ stayed where landlord failed to execute stipulated reference, told tenants they could stay longer, and accepted rent beyond the move out date; landlord ordered to execute reference letter and tenant given extra month to move; damages and move out date settled).
12. Kedrowski v. Doe, No.-UD 1950801514 (Minn. Dist. Ct. 4th Dist. Nov. 17, 1995) (Appendix 189) (non-negative reference, lease termination, and rent abatement).
13. Chromy v. Wastweet, No. CX-96-1328 (Minn. Dist. Ct. 7th Dist. Aug. 12, 1996) (Appendix 190) (Tenant’s remedies action settlement: $4,800 rent abatement, collected by prospective rent credit, lump sum or installment payments with interest; relocation of tenant during apartment remodeling and rehabilitation; relocation and moving benefits, suspension of rent subsidy to landlord until tenant returns to the remodeled; execution of lease and reinstatement of rent subsidy following remodeling; lease termination notice security deposit; any attempt to evict tenant during duration of agreement presumed retaliatory; court jurisdiction retained).
14. Pirkola v. Bastie, No. C1-95-602242 (Minn. Dist. Ct. 6th Dist. Feb. 20, 1996) (Appendix 196) (settlement for one month period for tenant to comply with local fire code).
15. Jenkins, Harvey, and Van Patten Settlement Agreement (Jan. 20, 1995) (Appendix 190(A)) (Section 8 voucher: schedule for landlord repairs, execution of new Section 8 lease, landlord participation in Section 8 program, rent abatement, lease termination with sixty days notice upon agreement to sell the house, favorable reference).
16. Guevara v. Catchings, No. UD-01970117520 (Minn. Dist. Ct. 4th Dist. Jan. 30, 1997) (Appendix TR 147b) (Settlement for dismissal of unlawful detainer action with prejudice, landlord enjoined from filing any unlawful detainer actions for nonpayment of rent until after repairs have been made, retaliation protection period of 90 days will not begin until all repairs have been made and rent abatement collected, unlawful detainer files will be expunged).
17. LaSalle Group, Ltd. v. _________, No. UD-1970326507 (Minn. Dist. Ct. 4th Dist. Sep. 30, 1997) (Appendix 267) (Joint request for expungement).
18. Heintzman v. Steinman, No. C7-99-1772 (Minn. Dist. Ct. 10th Dist. Dec. 29, 1999) (Appendix 394) (Based upon stipulation for dismissal, dismissal of action with prejudice and expungement).
19. 2407 Partners v. Kirk, No. HC-1990409512 (Minn. Dist. Ct. 4th Dist. Sep. 30, Dec. 8, 1999) (Appendix 402) (Settlement for rent abatement, landlord payment of $500 in costs for failure to register two business names with the Secretary of State, favorable reference, dismissal, and expungement; file expunged).
20. Bratton v. Cobb, No. 8C-000222514 (Minn. Dist. Ct. 4th Dist. Apr. 12, 2000) (Appendix 380) (parties agreed there was short service but executed move out agreement; case expunged due to short service).
21. _____ v. Tran, No. AC-03-13965 (Minn. Dist Ct. 4th Dist. Nov. 19, 2003) (Appendix 456) (repairs litigated in previous emergency relief action cannot be relitigated in subsequent action for property damage; landlord claiming tenant damage must prove the condition of the property when the tenant moved to the property, and a connection between repairs and tenant damage; landlord failed to comply with security deposit statute).
S. Consolidating the Eviction Action with Other Actions
While some courts take an expansive view of the relief that can be afforded the tenant, others view the court's jurisdiction to be very narrow. See Breach of Covenants of Habitability Relief, infra at VI.E.1.i; Remedies and Requests for Relief, infra at VII. Tenants' advocates should considering commencing a separate action and moving for consolidation. In Ridgemont Apartments v. Englund, No. C3-96-68 (Minn. Dist. Ct. 10th Dist. Apr. 1, 1996) (Appendix 191), the landlord of a RHCDS Sect. 515 subsidized housing project sought to terminate the tenant’s subsidy and increase the tenant’s share of the rent to the market rent for failing to recertify on time. The landlord brought an eviction (unlawful detainer) action, and the tenant defended the action while bringing an affirmative action as well. The court held that while the landlord gave the tenant several notices, the notice which contained the required information that failure to recertify would result in termination of the subsidy was not given thirty days before the due date, as required by the program handbook. Since the two actions were consolidated, in addition to dismissing the unlawful detainer action for non-payment of the market rent, the court granted additional affirmative relief, including ordering the landlord to recalculate the tenant’s share of the rent, immediately reinstate the subsidy if a subsidy slot was available, credit defendant’s rent for an amount equal to the subsidy even if a subsidy slot is not available, and notify the tenant of the amount of past rent due, and ordered the tenant to pay that amount within 10 days after notice from the landlord.
See generally Action Not Appropriate for Certain Types of Litigation, supra at II.B; Temporary Restraining Orders, supra at V.D.; Companion Actions, infra at VI.E.1.j, Housing Court Consolidation of Claims, supra at V.G.4; Appeal Period, infra at X.A.
T. Sealing or Expunging Court Records
In some circumstances, the court may considering sealing or expunging the eviction (unlawful detainer) court records. See discussion, infra, VIII.E.5.
U. Disbursement of Funds Paid Into Court
A party's payment of the funds into court does not operate as a relinquishment of the party's interest in the money. The parties are entitled to notice and an opportunity for hearing before the disposition of funds on deposit. Knutson v. Seeba, No. C7-98-1665 (Minn. Ct. App. Mar. 30, 1999) (Appendix 341) (Unpublished).
Subpoenaed witnesses who do not receive a witness fee along with the subpoena are not obligated to attend the trial. Parties are not entitled to county payment of witness fees. Bossen Terrace v. Price, No. C5-98-434 and C1-98-480 (Minn. Ct. App. Oct. 6, 1998) (Appendix 312) (Unpublished: Trial court did not err in quashing subpoenas where the witness fee was not paid, or requiring a preliminary showing of merit before providing witness fees).
Where the tenant’s attorney takes action on behalf of the tenant, such as calling or sending a letter to the landlord, there is a question as to whether the attorney can provide testimony on the subject. See Gale v. Winge, No. C7-98-2279 (Minn. Ct. App. July 6, 1999) (unpublished) (affirmed determination as not clearly erroneous that husband continued to use property as his place of abode and substitute service on wife was proper; minor inaccuracies in contract-for-deed legal description do not render the cancellation notice ineffective; trial court did not abuse its discretion in denying motion to vacate default judgment where tenant did not present a defense on the merits nor a reasonable excuse for failure to act; attorney's testimony at trial regarding payment of money was not on a contested issue, and did not require disqualification; equitable rights were not at issue, but equities were not in the defendants' favor).
Included in the Forms Appendix are form answers and motions for dismissal or summary judgment for private and subsidized tenancies.
B. Limitations on questions of title or equitable defenses
1. In Municipal or County Court
The court did not have jurisdiction to hear questions of title or equitable defenses. Dahlberg v. Young, 231 Minn. 60, 67-68, 42 N.W.2d 570, 576 (1950). However, the defendant could commence a separate action in district court and seek to enjoin prosecution of the eviction (unlawful detainer) action, William Weisman Holding Co. v. Miller, 152 Minn. 330, 332, 188 N.W. 732, 733 (1922), or remove the action to District Court. Albright v. Henry, 285 Minn. 452, 460, 174 N.W. 2d 106, 110 (1970). See Brundidge v. Bleckinger, No. UD-1850916524 (Henn. Cty. Mun. Ct., Oct. 28, 1985) (Appendix 2).
Unification of trial courts in the district court should have altered the above limitation. See Sternaman v. Hall, 411 N.W.2d 18, 19 n.1 (Minn. Ct. App. 1987). But subsequent decisions have affirmed the rule, even though the rule probably was based on the jurisdictional limits of municipal and county courts, rather than an inherent jurisdictional limitation for eviction (unlawful detainer) actions. Federal Land Bank v. Obermoller 429 N.W.2d 251, 257 (Minn. Ct. App. 1988), pet. for rev. denied (Minn. Oct. 26, 1988); Park Drive Partnership v. Granse No. C7-96-401 (Minn. Ct. App. Sep. 24, 1996), Finance & Commerce at 38 (Sep. 27, 1996) (Appendix 193) (unpublished decision: pending separate quiet title action did not preclude unlawful detainer action, which determines who has the superior right of possession, but does not determine title; the defendant cannot assert title, equitable rights or counterclaims; the defendant did not present any evidence demonstrating a greater right of possession than the plaintiff); Bjur v. Burgmeier, No. C2-92-409 (Minn. Ct. App. Aug. 18, 1992), Finance & Commerce at B45 (Aug. 21, 1992) (unpublished: because plaintiff as the mortgagees assignee, has presumptively good title and because defendants cannot litigate title in an eviction (unlawful detainer) action, defendants are foreclosed from challenging plaintiffs title by reference to their collateral litigation) (Appendix 0.H); Stein v. J.D. White, Inc., No. C0-91-2164 (Minn. Ct. App. Apr. 21, 1992), Finance & Commerce at B24 (April 24, 1992) (unpublished: rule that unlawful detainer action merely determines right to present possession of property and does not determine ultimate rights of the parties is based in part on an obsolete division of equity jurisdiction between municipal and district courts, but the rule retains legal force because the unlawful detainer action is a suspension of ordinary procedures in order to achieve a summary disposition of the right to present possession) (Appendix 0.F); Hargreaves v. FDIC, No. C9-89-1966) (Minn. Ct. App. June 12, 1990), Finance & Commerce at B12 (June 15, 1990) (unpublished) (unlawful detainer action does not adjudicate legal or equitable ownership interests).
However, in Lilyerd v. Carlson, 499 N.W.2d 803, 807, 812 (Minn. Ct. App. 1993), the court noted that while an eviction (unlawful detainer) action is generally summary in nature, determines only present possessory rights, and usually does not bar subsequent actions involving title or equitable rights of the parties, counterclaim for first right of refusal to purchase could have been tried to the unlawful detainer action jury.
In Real Estate Equity Strategies, LLC v. Jones, 720 N.W.2d 352 (Minn. Ct. App. 2006), the Court reviewed the history of litigation of title issues in eviction actions, dating back to the time when evictions were heard in county and municipality courts of limited jurisdiction. The Court concluded that unification of the trial courts removed any limitations based on the nature of the court, leaving only limitations based on the summary nature of the eviction action, which does not preclude litigation of title.
3. Mortgage Foreclosure and Contract for Deed Cancellation
a. Before 2006
There was some confusion over whether the defendant can litigate the plaintiff's compliance with procedural requirements of mortgage foreclosure and contract for deed cancellation statutes. The defendant clearly may raise non-compliance with statutory notice and service requirements for contract for deed cancellation. Enga v. Felland, 264 Minn. 67, 70-71, 117 N.W.2d 787, 789-90 (1962) (eviction reserved for improper contact for deed cancellation). See Revels v. O’Neal, No. UD-1960723503 (Minn. Dist. Ct. 4th Dist. Sep. 11, 1996) (Appendix 194) (contract for deed cancellation notice properly served; vendor’s mortgagee is not a party which must be served; defenses of unjust enrichment, void and unenforceable contract for deed and fraudulent inducement could not be raised in the eviction (unlawful detainer) action where vendee brought no action within the statutory sixty day period following notice of cancellation); Swartwood v. Clark, No. UD-1920928505 (Minn. Dist. Ct. 4th Dist. Oct. 15, 1992) (Appendix 16.C) (vendor failed to meet burden of proof regarding alleged service of cancellation notice); Edwards v. Sagataw, No. 31-C2-92-512 (Minn. Dist. Ct. Itasca Cty. Apr. 30, 1992) (Appendix 16.D) (quit claim deed obtained by vendor from vendee while vendee was not in default lacked consideration; allegations of default in payment of taxes by vendee implied continuing application of contract for deed; vendor, cannot evict vendees without foreclosing the contract). See also discussion, supra at V.N. (collateral estoppel).
However, raising mortgage foreclosure defects was another story. In Amresco Residential Mortgage Corp. v. Stange, 631 N.W.2d 444 (Minn. Ct. App. 2001), the trial court ruled that it could not consider mortgage defects in the eviction action. On appeal, the court held that rather than order the trial court to hear the issues or convert the action to an ejectment action, the appellants could seek to enjoin prosecution of the eviction action in the separate proceeding in which they sought to set aside respondent's foreclosure which they commenced after dismissal of their counterclaims in the eviction action. While the court affirmed dismissal of the counterclaims, it ordered that the court's stay of the writ of restitution during the appeal be continued for a reasonable period of time in which appellants can assert, and the district court can determine in their pending proceeding, whether their right of possession should be protected by enjoining the writ until the court rules on their title claims. See AHR Construction, Inc. v. Dixon, Nos. A06-1554, A06-0248, 2007 WL 2417083 (Minn. Ct. App. Aug. 28, 2007), review denied (Minn. Nov. 21, 2007) (unpublished) (challenges to foreclosure cannot be raised in an unlawful detainer action and must be asserted in a separate proceeding, citing AMERSCO). But see Comerica Mortgage Corp. v. Gaddy, No. UD-1950223514 (Minn. Dist. Ct. 4th Dist. Mar. 24, 1995) (Appendix 195) (Mortgager did not prove that service of the notice of foreclosure sale was insufficient).
In Fraser v. Fraser, 642 N.W.2d 34 (Minn. Ct. App., 2002), the husband's father, who sold house to husband and wife under contract for deed, gave notice of cancellation of contract after husband brought dissolution action. The wife sought to enjoin cancellation as part of dissolution proceedings, which was granted and later vacated. The father then brought an eviction action against wife, and the district court ruled in father's favor. The wife appealed in both cases and they were consolidated. The court held that there was no jurisdiction in the dissolution action jurisdiction to enjoin cancellation of contract for deed. In the eviction action, the court held that the trial court was not bound by findings on the contract for deed service from the dissolution action, given the lack of jurisdiction in the latter. As to whether the wife could litigate equitable real estate issues in the eviction case, relying on Amresco Residential Mortgage Corp. v. Stange, 631 N.W.2d 444 (Minn. Ct. App. 2001), the court held that if she has the ability to litigate her equitable mortgage and other claims and defenses in alternate civil proceedings where she could enjoin the eviction action, it would be inappropriate for her to seek to do so in the eviction action. However, since the court could not determine whether the eviction action was wife's only opportunity to address her claims and defenses, it remanded the case for the district court to address wife's service claims, address the propriety of entertaining wife's equitable defenses in the eviction action or in an alternate proceeding; and, if appropriate, decide the equitable defenses.
In most eviction (unlawful detainer) actions based on contract for deed cancellation or mortgage foreclosure the plaintiff will assert compliance with statutory procedures in the complaint. The defendant's denial of these claims is not an equitable defense, but rather a denial that plaintiff has satisfied the procedural preconditions for commencing the action.
The defendant was precluded from raising ultimate legal or equitable defenses in an eviction (unlawful detainer) action. See Dahlberg; William Weisman Holding Co. But see Lilyerd. In Dahlberg, the Court made the distinction between the claim that an instrument is voidable is an equitable issue, while the claim that an instrument is void is not an equitable issue, concluding that the claim of fraud involved whether the instrument was voidable, thus an equitable issue that could not be raised in an unlawful detainer action. The defendant could assert that challenging compliance with procedural requirements is not an equitable issue, since it involves a determination of whether the contract for deed cancellation or mortgage foreclosure was void, rather than voidable.
b. 2006: Real Estate Equity Strategies, LLC v. Jones
The issue of litigation of mortgage foreclosure issues in eviction cases took another turn in Real Estate Equity Strategies, LLC v. Jones, 720 N.W.2d 352 (Minn. Ct. App. 2006). When the defendants’ home went into foreclosure, they entered in an agreement with the plaintiff under which the defendants sold their home to one of plaintiff’s entities, which leased it back to the defendants with an option for purchase. When the defendants defaulted on the lease, the plaintiff filed an eviction action against them. The defendants filed a separate equity stripping action against the plaintiff and its entities under Minn. Stat. §§ 325N.01-08, and filed an answer in the eviction case asking for dismissal or a stay pending resolution of the equity stripping action. The trial denied the motion and entered judgment for the plaintiff.
The Court of Appeals affirmed the decision, first concluding that a defendant’s assertion of claim of title under Minn. Stat. § 504B.121 does not deprive subject matter jurisdiction to the eviction court. Id. The Court concluded that the trial court has discretion to decide whether to stay the eviction pending resolution of the equity stripping action, and does not abuse its discretion by declining to stay the eviction. Id.
The Court reviewed the history of litigation of title issues in eviction actions, dating back to the time when evictions were heard in county and municipality courts of limited jurisdiction. The Court concluded that unification of the trial courts removed any limitations based on the nature of the court, leaving only limitations based on the summary nature of the eviction action, which does not preclude litigation of title. Id.
Since this decision, the Legislature amended Minn. Stat. § 325N.18 to include a new subdivision 6, which requires the court to issue an automatic stay without imposition of a bond if a defendant makes a prima facie showing that the defendant has commenced an illegal foreclosure reconveyance action, raises the defense under Minn. Stat. § 504B.121 of an illegal foreclosure reconveyance, or asserts a claim of fraud, false pretense, false promise, misrepresentation, misleading statement, or deceptive practice in conveyance with a foreclosure reconveyance. The defendant also must show that the defendant owned foreclosed residence, the foreclosure reconveyance, and continued occupancy of the property. The automatic stay expires if the foreclosed homeowner fails to commence a foreclosure reconveyance action within 90 days of issuance of the stay.
Just months before the Real Estate Equities Strategies decision and afterwards, the Court of Appeals has following the earlier line of cases, holding that the eviction court could not adjudicate legal and equitable rights of ownership. RedStar Capital, LLC v. Rex, No. A07-1873, 2008 WL 5136002 (Minn. Ct. App. Dec. 9, 2008) (unpublished); Ketterling v. Hamilton, Nos. A05-1872, A05-2119, 2006 WL 2258053 (Minn. Ct. App. Aug. 8, 2006) (unpublished); Sundberg v. Sundberg, No. A05-1845, 2006 WL 1806394 (Minn. Ct. App. July 3, 2006) (unpublished) (eviction defendant could not litigate the legal cancellation of contract for deed).
Counterclaims or set offs are not allowed if the basis of the counterclaim or setoff is independent of the tenant's obligation to pay rent. Keller v. Henvit, 219 Minn. 580, 585, 18 N.W.2d 544, (1945); William Weisman Holding Co. v. Miller, 152 Minn. 330, 332, 188 N.W. 732, (1922); Warren v. Hodges, 137 Minn. 389, 390, 163 N.W. 739, (1917) (in nonpayment of rent case, no defense for landlord's violation of repair covenant); Peterson v. Kreuger, 67 Minn. 449, 450, 70 N.W. 567, (1897). Warren was reversed in Fritz v. Warthen, 298 Minn. 48, 54, 213 N.W.2d 339, 341-42 (1973), where the court held that § 504.18 (now § 504B.161) created an exception to the rule, holding that the covenants of habitability and the covenant to pay rent are mutual and dependant, and all or part of the rent is not due when the landlord has breached the covenants.
1. Requirements for personal jurisdiction
"The summons shall be served . . . in the manner provided for service of a summons in a civil action in the district court." Minn. Stat. § 504B.331 (formerly § 566.06). See Minn. R. Civ. P. 4. The summons and complaint shall be served not less than seven (7) nor more than fourteen (14) days before the initial court appearance. Minn. Stat. §§ 504B.321 (formerly § 566.05), 504B.331 (formerly § 566.06). The time period excludes the date of service but includes the date of the initial hearing. Minn. Stat. § 645.15. See Township Bd. v. Lewis, 305 Minn. 488, 490-92, 234 N.W.2d 815, 817-18 (1975).
Minn. Stat. § 504B.331 (formerly § 566.06) provides for the methods of service:
a. By delivery to the defendants.
b. If the defendants cannot be found in the county, substituted service.
(1) By delivery at the defendant's residence, to a family member or other person of suitable age and discretion residing at the defendant's residence, or
(2) By mail and posting, if
(A) service has been attempted at least twice on different days, with at least one of the attempts between 6:00 p.m. and 10:00 p.m., and
(B) The plaintiff or counsel files an affidavit (1) stating that the defendant cannot be found, or the affiant believes that the defendant is not in the state, and (2) that a copy of the summons has been mailed to the defendant at the defendant's last address known to the plaintiff.
The summons may be served by any person not named a party to the action. See also Minn. R. Civ. P. 4.02. If the defendant is confined to a state institution, by serving also the chief executive officer at the institution. Minn. R. Civ. P. 4.03(a).
Strict compliance with service requirements is a precondition to personal jurisdiction. See Bloom v. American Express Co., 222 Minn. 249, 253, 23 N.W.2d 570, (1946). B&J Property Management v. Gates, No. UD-01970602519 (Minn. Dist. Ct. 4th Dist. June 12, 1997) (Appendix 247) (Dismissal for improper service, failure to register trade name, and failure to attach notice to quit and lease to complaint).
Minn. Stat. § 504B.331 (formerly § 566.06); Karnis v. Rayford, No. UD-1940714513 (Minn. Dist. Ct. 4th Dist. Aug. 15, 1994) (personal service proven by a preponderance of the evidence) (Appendix 37); Koop v. _____, No. 27-CV-HC-09-1163 (Minn. Dist. Ct. 4th Dist. Feb. 17, 2009) (Appendix 606) (eviction dismissed for improper service, where action listed four named defendants and affidavit of service claimed service on “John Doe”). If the process server and the defendant are within speaking distance of each other and the process server takes such action as to convince a reasonable person that personal service is being attempted, the defendant cannot avoid service simply by refusing to accept the summons. Nielsen v. Braland, 264 Minn. 481,484, 119 N.W.2d 737, 739 (1963).
b. Service less than seven (7) days before the initial hearing
The summons must be served seven days before the hearing, but not to the exact hour. Central Internal Medicine Assoc. P.A. v. Chilgren, No. C2-00-36, 2000 WL 987858 (Minn. Ct. App. July 18, 2000) (unpublished). Minn. Stat. § 504B.331 (formerly § 566.06).
In Peart v. Peloquin, No. C3-90-430 (Minn. Dist. Ct. 8th Dist. May 25, 1990), the court dismissed the action when the tenant received the summons and complaint only five days before the hearing. (Appendix 2.A). See Judge v. Rio Hot Properties, Inc., No. UD-1981202903 (Minn. Dist. Ct. 4th Dist. July 7, 1999) (Appendix 401) (unlawful detainer action dismissed for service less than seven days before the hearing); Bratton v. Cobb, No. 8C-000222514 (Minn. Dist. Ct. 4th Dist. Apr. 12, 2000) (Appendix 380) (parties agreed there was short service but executed move out agreement; case expunged due to short service).
Minn. Stat. §645.44, subd. 5 prohibits services on legal holidays. Service on Sunday had been prohibited by § 624.04, but it was repealed in 2005.
d. Service by a named plaintiff or agents
Service by the plaintiff is improper. Minn. R. Civ. P. 4.02. Williams v. McCrimmon, No. UD-1991207535 (Minn. Dist. Ct. 4th Dist. Dec. 17, 1999) (Appendix 428) (Improper service by delivery to a person of suitable age and discretion, who lives in Iowa and was only a temporary guest of the tenant; service on the tenant was made by the plaintiff; action dismissed). See Landgren v. Pipestone County Board of Commissioners, 633 N.W.2d 875 (Minn. Ct. App. 2001) (sheriff may not serve his own action).
In Lewis v. Contracting Northwest, Inc., 413 N.W.2d 154 (Minn. Ct. App. 1987), the court explained the reason for precluding parties from serving process:
The law has wisely entrusted the decision of disputes between citizens to persons wholly disinterested and free from bias and the acrimony of feeling so frequently, if not uniformly, engendered by litigation; and the same is equally true of the persons selected to execute the process necessary to the adjustment of such disputes.
Id. at 155 (emphasis added). A court should carefully scrutinize service by persons related to or employed by the plaintiff who are not "wholly disinterested and free from bias" related to the action.
A number of courts have held that partners, managers, caretakers, and other employees of the plaintiff are not authorized to serve defendants because they are not wholly disinterested in the case. In Hedlund v. Potter, No. C3-91-1542 (Minn. Dist. Ct. 10th Dist. Dec. 31, 1991), the caretaker for the landlord served the tenant with the summons and complaint. The caretaker had signed the lease, and was authorized to sign leases, collect rent, maintain the premises, and receive service of process on behalf of the landlord under Minn. R. Civ. P. 4.03. Id. at 2. The court held that service was improper under Minn. Stat. § 566.06 (now § 504B.331) and Minn. R. Civ. P. 4.02, which states that the summons must be served by any person not named a party in the action. Id. at 4. (Appendix 4.C.2). See Meldahl and SJM Prop. v. _____, No. 1050923509, Order on Referee Review at 12-14 (Minn. Dist. Ct. 4th Dist. Feb. 23, 2006) (Appendix 609) (judge reversed referee and ordered dismissal for improper service by maintenance person who was agent for landlord); MJD Enterprises, Inc. v. _____, No. HC-1040406523 (Minn. Dist. Ct. 4th Dist. May 18, 2004) (Appendix 612) (eviction dismissed and expunged and costs awarded where property manager served defendant and filed false affidavit stating that another person served defendant; it was irrelevant that manager called herself an “independent contractor” when she handled all matters related to rental); Alex Properties v. _____, No. HC 031105500 (Minn. Dist Ct. 4th Dist. Nov. 13, 2003) (Appendix 462) (dismissal for service by plaintiff’s managing partner); Sidal Realty Company, LLP v. _____, No. HC 030114401 (Minn. Dist Ct. 4th Dist. Jan. 28, 2003) (Appendix 569) (dismissal for service by employee of plaintiff); Riebe v. Graves, No. UD-1940321515 (Minn. Dist. Ct. 4th Dist. Apr. 11, 1994) (improper service by person whose duties, responsibilities, rights and powers were identical to named plaintiff) (Appendix 38).
e. Substituted service on non-defendant defenses
(1) Defendant could be found in the county
Berrybill v. Healey, 89 Minn. 444, 446, 95 N.W. 314, (1903). See Durigan v. Smith, No. UD-80515 (Henn. Cty. Mun. Ct., July 25, 1977) (Appendix 3) (service improper).
(2) Service on a person who does not reside with the defendant
Murray v. Murray, 159 Minn. 111, 113-14, 198 N.W. 307, 308 (1924); 1 D. McFarland & W. Keppel, Minnesota Civil Practice, § 935 at 464 (1979) (hereinafter "D. McFarland & W. Keppel"). When the issue of nonresidence has been raised but not proven by the defendant, the courts have considered when the defendant actually received the summons. See Murray, 159 Minn. at 114, 198 N.W. at 308; Juhl v. Rose, 366 N.W. 2d 706, 707 (Minn. Ct. App. 1985); Metropolitan Bank v. Panis, No. CX-89-681 (Minn. Ct. App. Aug. 22, 1989) (unpublished). The defendant should present convincing evidence of nonresidence, such as testimony or an affidavit of the person's landlord and proof of rent payment. See Norby v. _____, No. _____ (Minn. Dist Ct. 4th Dist. May 24, 2001) (Appendix 549) (improper substitute service on non-resident house guest); Stevens Avenue Limited Partnership v. Hayes, No. UD-1930203533 (Minn. Dist. Ct. 4th Dist. Feb. 11, 1993) (Appendix 3.A) (dismissal where service was on nonresident); Sloneker v. Taylor, No. UD-1940810530 (Minn. Dist. Ct. 4th Dist. Sep. 16, 1994) (dismissal where service was a non-resident) (Appendix 39); Minneapolis Public Housing Authority v. Kline, No. UD-1930712506 (Minn. Dist. Ct. 4th Dist. Aug. 5, 1993) (Appendix 3.B) (motion to quash writ granted where service was on child who did not reside on the premises).
In Capper v. Kragt, No. C6-98-698 (Minn. Ct. App. Aug. 25, 1998) (Appendix 317) (The Court reversed a trial court denial of the defendant's motion to dismiss for insufficient service, where the summons and complaint were served on a neighbor and relative of the defendant, who agreed to give the papers to the defendant. The Court noted that because the process server failed to substantially comply with the requirements of Minn. R. Civ. P., the fact that the defendant later received the summons and complaint did not render service proper.
The status of a person being a resident is somewhere between something more permanent as in domicile, and something less permanent as in a visitor. O’Sell v. Peterson, 595 N.W.2d 870 (Minn. Ct. App. 1999) (service on defendant’s 14-year-old stepson who stayed with defendant during regular and planned noncustodial visitation was a resident; discussion of cases in Minnesota and other states). But see Williams v. McCrimmon, No. UD-1991207535 (Minn. Dist. Ct. 4th Dist. Dec. 17, 1999) (Appendix 428) (Improper service by delivery to a person of suitable age and discretion, who lives in Iowa and was only a temporary guest of the tenant; service on the tenant was made by the plaintiff; action dismissed).
(3) Service on a person who is not of suitable age and discretion
There is no minimum age for a person receiving service. The person need not understand the legal importance of the papers. Holmen v. Miller, 296 Minn. 99, , 206 N.W.2d 916, 919 (1973). While there are no reported cases interpreting this part of Minn. Stat. § 504B.331 (formerly § 566.06), courts have upheld service on children in two cases involving a rule and statute with the same language. In Holmen v. Miller, 296 Minn. 99, 103-05, 206 N.W.2d 916. 919-20 (1973), the court held that the sheriff's certificate, which stated that the 13 year old who received service of a civil summons was of suitable age and discretion, was prima facie evidence of proper service, and defendant did not rebut the presumption where defendant cited no evidence other than the child's age. In Temple v. Norris, 53 Minn. 286, 289, 55 N.W. 133, 134 (1893), the court presumed that a 14-year old was of suitable age and discretion to be served with a civil complaint by the sheriff, where it was not shown that she was not ordinarily intelligent nor in full possession of her facilities. See D. McFarland & W. Keppel, supra, § 935.
Both cases involve service by the sheriff, whose certificate is prima facie evidence. However, an affidavit of service from someone other than the sheriff is not prima facie evidence, and is entitled to no greater weight that the defendant's affidavit. See Seivert v. O'Brien, 202 Minn. 314, 316, 278 N.W. 162, (1938).
The defendant should present convincing evidence of the child's age and discretion, such as the child's general behavior, educational level and performance, ability to follow instruction and to deliver letters and notices (i.e., notes from teachers), and when defendant actually received the papers, if at all. See Minneapolis Public Housing Authority v. Kline, No. UD-1930712506 (Minn. Dist. Ct. 4th Dist. Aug. 5, 1993) (Appendix 3.B) (motion to quash writ granted where service was on child who did not reside on the premises); Joiner v. Harris, No. UD-1930712506 (Minn. Dist. Ct. 4th Dist. July 23, 1993) (Appendix 3.C) (dismissal for service on 13 year old child who suffered from attention deficit disorder; affidavit of service did not identify the person receiving service).
(4) Service not at the defendant's residence
See Holtberg v. Bommersbach, 236 Minn. 335, 337-38, 52 N.W.2d 766, 768-69 (1952); Crofton v. ______, No. HC 030702519 (Minn. Dist Ct. 4th Dist. July 10, 2003) (Appendix 489) (improper service by leaving summons and complaint at tenant’s workplace).
f. Improper substitute service by mail and posting
(1) The defendant could be found in the county.
Berryhill v. Healey, 89 Minn. at 446, 95 N.W. at 315.
(2) Personal service was not attempted twice on different days, with at least one attempt between 6:00 p.m. and 10:00 p.m.
Project for Pride in Living, Inc. v. _____, No. HC 010815515 (Minn. Dist Ct. 4th Dist. Aug. 29, 2001) (Appendix 563) (mailing and posting service improper where there was no attempt at personal service between 6:00 and 10:00 p.m.).
(3) The summons was mailed but not posted, or posted but not mailed.
Harris v. _____, No. HC 031006514 (Minn. Dist Ct. 4th Dist. Oct. 14, 2003) (Appendix 512) (dismissal for failure to mail summons); Hartog v. Ketchum, No. C4-94-796 (Minn. Dist. Ct. 3rd Dist. July 25, 1994) (dismissal where summons was posted but not mailed) (Appendix 40).
(4) No affidavit filed.
While the affidavit has specific requirements, the court tends to look at actual service rather than the contents of the affidavit. Juhl v. Rose, 366 N.W.2d at 707 (service on person residing with defendant). But see Igherighe v. _____, No. HC 020208501 (Minn. Dist Ct. 4th Dist. Feb. 20, 2002) (Appendix 521) (improper mailing and posting service where plaintiff filed no affidavit of posting, and affidavit of not finding defendant was ambiguous of whether service was attempted in the evening; dismissed and expunged).
(5) The plaintiff posted the summons before mailing the summons and filing the affidavit of mailing, rather than mailing the summons, filing the affidavit, and then posting the summons.
Ali v. _____, No. HC 040213545 (Minn. Dist Ct. 4th Dist. Feb. 27, 2004) (Appendix 463) (dismissal for posting before filing affidavits); Plymouth Avenue Townhomes and Apartments v. Hollie, No. UD-1950912555 (Minn. Dist. Ct. 4th Dist. Sept. 26, 1995) (Appendix 96); Blackmon v. Johnson, No. UD-1950516515 (Minn. Dist. Ct. 4th Dist. June 2, 1995) (Appendix 97); Gasparre v. Acres, No. UD-2940715809 (Minn. Dist. Ct. 4th Dist. July 28, 1994) (dismissal) (Appendix 41); Minneapolis Public Housing Authority v. McKinley, No. UD-98-0305507 (Minn. Dist. Ct. 4th Dist. Mar. 27, 1998) (Appendix 348A) (Posting of summons before mailing of summons did not comply with statute and rule, requiring dismissal).
(6) Time for posting
The summons must be posted for seven days, but not to the exact hour. Central Internal Medicine Assoc. P.A. v. Chilgren, No. C2-00-36, 2000 WL 987858 (Minn. Ct. App. July 18, 2000) (unpublished).
g. If the defendant is confined to a state institution, failure to serve the institution's chief executive officer. Minn. R. Civ. P. 4.03(a).
h. Improper affidavit of service
See Joiner v. Harris, No. UD-1930712506 (Minn. Dist. Ct. 4th Dist. July 23, 1993) (Appendix 3.C) (dismissal for service on 13 year old child who suffered from attention deficit disorder; affidavit of service did not identify the person receiving service).
Often tenants have other defenses in addition to the defense of improper service. If a defendant does not move the District Court for dismissal based on lack of personal jurisdiction before or contemporaneously with a motion for dismissal on other grounds or partial summary judgment, the defendant invokes the jurisdiction of the District Court and waives by implication, the defense of lack of personal jurisdiction. Patterson v. Wu Family Corporation, 608 N.W.2d 863 (Minn. 2000).
j. Service before filing action
Service may not occur before filing the action. Stevens Community Assoc. v. _____, No. HC 010003507 (Minn. Dist Ct. 4th Dist. Oct. 12, and Dec. 13, 2000) (Appendix 579) (dismissal where affidavit of service claimed service before action was filed; expungement granted later).
Service on a business must be on a person authorized to accept service. Tri Star Developers, LLC v. _____, No. HC 010109514 (Minn. Dist Ct. 4th Dist. Oct. 17, 2001) (Appendix 584) (improper service on employee of business who was not an officer and not authorized to accept service; defendant business was incorrectly named; default judgment vacated and action dismissed and expunged).
3. It is unclear whether defendants can be designated as "John" or "Jane Doe"
The summons must be directed to "stating the full name and date of birth of the person against whom the complaint is made, unless it is not known . . ." Minn. Stat. § 504B.321 (formerly § 566.05). The eviction (unlawful detainer) statutes do not contain authority for commencement of an action against an unknown defendant by use of a fictitious name. Compare with Minn. Stat. §§ 558.02 (partition of real estate), 559.02 (adverse claims to real estate).
While Minn. R. Civ. P. 9.08 provides for designating the unknown name of an opposing party with any name, it also contemplates amendment of the pleadings with the true name of the party. See Peterson v. Sorlien, 299 N.W.2d 123, 132 (Minn. 1980); Leaon v. Washington County, 397 N.W.2d 867, 871-72 (Minn. Ct. App. 1986). Since the eviction (unlawful detainer) action is a summary proceeding, some of the Minnesota Rules of Civil Procedure may not apply. It appears that Rule 9.08 contemplates an action of longer duration, which would allow for identification of the true names of the defendants.
The writ of restitution should not be enforced against unnamed occupants. The writ of restitution is to be executed against the defendant if he or she can be found in the county, or any adult member of the defendant's family, or other person in charge of the premises. The writ directs the defendant to remove himself or herself, the defendant's family, and all of their personal property from the premises. Minn. Stat. § 504B.365 (formerly § 566.17).
The writ cannot be enforced against a person who was not a party to the eviction (unlawful detainer) action nor named in the writ of restitution. See Kowalenko v. Haines, No. C6-85-1365 (Minn. Ct. App., July 24, 1985) (attached as Appendix 4). In Kowalenko, the petitioner had subleased the apartment from the former tenants. The writ was enforced against the petitioner, pursuant to an unlawful detainer action against former tenants, but not the petitioner. The petitioner was not named in the writ. The court ordered the landlord to return possession of the apartment and petitioners personal property to her, pursuant to Minn. Stat. § 504B.375 (formerly § 566.175).
If the sheriff cannot determine whether the designation of "John" or "Jane Doe" includes the person in the premises, the sheriff should not enforce the writ. See Casper v. Klippen, 61 Minn. 353, 356, 63 N.W. 737, 739 (1895). Given the uncertainty of application of Rule 9.08 and the problems in enforcing a "John" or "Jane Doe" writ, the prudent landlord should avoid such designation and discover the names of tenants prior to commencing an eviction (unlawful detainer) action.
The tenant who has not been specifically named in an eviction (unlawful detainer) action faces a dilemma about challenging how the case has been pled. While the tenant may have grounds for re-opening the action and vacating the judgment based on a lack of personal jurisdiction, the landlord may simply refile another action pleading the name of the tenant. If a tenant does not have any other defenses to the action, the tenant simply will have bought more time to move by forcing the landlord to file an eviction (unlawful detainer) action which will become part of the tenant's record with the tenant screening company, making it more difficult to move. In addition, if the case name remains John or Jane Doe, then tenant screening agencies may not be able to connect the case to the tenant. Depending on other defenses available to the tenant, the tenant may be better served by raising the issue with the landlord and negotiating for more time to move and a positive or neutral tenant reference, thus avoiding a court file which creates an unfavorable tenant screening report.
In Koop v. _____, No. 27-CV-HC-09-1163 (Minn. Dist. Ct. 4th Dist. Feb. 17, 2009) (Appendix 606), the eviction was dismissed for improper service, where action listed four named defendants and affidavit of service claimed service on “John Doe.”
The landlord may bring the action against the tenant and subtenant, jointly. Judd v. Arnold, 31 Minn. 430, 433, 18 N.W. 151, 152 (1884). However, if the subtenant is not named as a party in an action against the tenant, the writ cannot be enforced against the subtenant. Bagley v. Steinberg, 34 Minn. 470, 471, 26 N.W. 602, (1886); Kowalenko v. Haines, No. C6-85-1365 (Minn. Ct. App. July 24, 1985) (Appendix 4).
D. Failure to Satisfy Preconditions to Recovery of the Premises
1. The plaintiff is not entitled to possession
The action may be commenced only by the person entitled to the premises, Minn. Stat. § 504B.285 (formerly § 566.03), subd. 1, or the authorized management company or agent for the owner of the premises. Minn. Stat. § 481.02, subd. 3(13). See Johnson v. Robertson, No. UD-193072254 (Minn. Dist. Ct. 4th Dist. Aug. 4, 1993) (Appendix 4.B.1) (dismissal where plaintiff's agent appeared without written authorization); Remas Properties, LLC v. Student, No. UD-1940705517 (Minn. Dist. Ct. 4th Dist. July 19, 1994) (Appendix 27); Lewis Properties v Pruitt, No. UD-1950315516, Decision Order at 2 (Minn. Dist. Ct. 4th Dist. Sept. 22, 1995) (92).
One joint tenant can evict a lessee from co- owned property without the other joint tenant's consent. Abraham V. Bellefy, No. A03-585, 2004 WL 193127 (Minn. Ct. App. Feb. 3, 2004) (unpublished).
In Hedlund v. Potter, No. C3-91-1542 (Minn. Dist. Ct. 10th Dist.), the action was commenced by an individual. The court found that the individual plaintiff was not a proper party, since he simply was a trustee for an entity that he had formed, and that he provided no evidence stating his relationship to the entity. Order (Nov. 26, 1991) (Appendix 4.C.1). See FTK Properties, Inc. v. US Benefit Association, LLC, No. HC 010518508 (Minn. Dist Ct. 4th Dist. June 1, 2001) (Appendix 503) (action dismissed without prejudice where three shareholder corporation landlord of commercial property was represented by a person who was not an attorney and did not have a power of attorney.
The power of authority must be properly executed. DeCourey v. Peterson, No. UD-1940614513 (Minn. Dist. Ct. 4th Dist. July 1, 1994) (Appendix 42). A power of authority signed by a person other than the principle must be notarized. Minneapolis Public Housing Authority v. Redding, No. UD-1930222507 (Minn. Dist. Ct. 4th Dist. Mar. 5, 1993) (Appendix 4.B.2); Minn. Stat. § 523.01; Remas Properties, LLC v. Student, No. UD-1940705517 (Minn. Dist. Ct. 4th Dist. July 19, 1994) (Appendix 27).
A landlord who files bankruptcy listing the premises as part of the bankruptcy estate relinquishes control of the premises to the bankruptcy court, and does not have the right to file an eviction (unlawful detainer) action until the bankruptcy court abandons the property. See Grandco Management v. Wielding, No. UD-1921202525 (Minn. Dist. Ct. 4th Dist. Dec. 16, 1993) (Appendix 4.B.3). If the plaintiff is a corporation, the attorney or advocate for the tenant should determine whether the corporation is in good standing by contacting the Secretary of State at 296-2803. If the corporation is not in good standing, the court should dismiss the action because a corporation not in good standing would not be entitled to possession as a proper party.
Similarly, the owner may not be a proper plaintiff when the property is under the control of a court appointed administrator in a tenant remedies action. See Sun Trust Mortgage Inc. V. ______, No. 27-CV-HC-08-5044, Order (Minn. Dist. Ct. 4th Dist. June 25, 2008) (Appendix 622) (eviction filed by owner dismissed and expunged where property was under control of administrator in another action); Minn. Stat. §§ 504B.385, 504B.425, 504B.435, 504B.445, 504B.451, 504B.455, 504B.461.
It seems increasingly common for landlords to defend a retaliation claim by asserting that they have sold or are going to sell the property. In Mattice v. Judge, No. UD-1990504519 (Minn. Dist. Ct. 4th Dist. May 19, 1999) (Appendix 399), the plaintiff was a purchaser on a purchase agreement for the property, but there had been no closing on the purchase agreement, the seller had not yet conveyed a deed to the plaintiff, and the purchase agreement did not otherwise entitle the plaintiff to possession of the property prior to closing on the purchase agreement. The court concluded that the plaintiff was not entitled to current possession of the property. See Filas v. _____, No. HC 040115532 (Minn. Dist Ct. 4th Dist. Feb. 18, and Mar. 10, 2004) (Appendix 497) (motion to quash writ granted and eviction dismissed where “Plaintiffs were not the real parties in interest when the complaint was filed because they had executed a contract for deed, now cancelled, with another vendee”, later expunged).
2. Landlord address disclosure
The landlord cannot maintain an eviction (unlawful detainer) action if the names and addresses of the authorized manager of the premises and the owner or agent authorized to accept service, are not disclosed as required by the statute, and such information is not known by the tenant at least 30 days before the issuance of the summons. Minn. Stat. § 504B.181 (formerly § 504.22); Sakala v. _____, No. 27-CV-HC-08-6156 (Minn. Dist. Ct. 4th Dist. Sep. 9, 2008) (Appendix 619) (order reversing referee order for eviction, and dismissing eviction action for landlord's failure to post address until two weeks after filing eviction action); Haage v. Strong, No. UD-1911206527 (Minn. Dist. Ct. 4th Dist. Dec. 20, 1991) (Appendix 4.A) (dismissal for landlord's failure to give oral or written notice of his address); Dube v. Dahill, Partial Transcript, No. 2941107802 at 6 (Minn. Dist. Ct. 4th Dist. Nov. 17, 1994) (Appendix 137); Edwards v. Bledsoe, No. UD-1940712561 (Minn. Dist. Ct. 4th Dist. Aug. 16, 1994) (Appendix 43) (plaintiff failed to prove compliance by preponderance of evidence).
A post office box does not comply with the statute, since it is not an address and not a place where the plaintiff can be personally served. In Brown v. Austin, No. UD-1000203527 (Minn. Dist. Ct. 4th Dist. Feb. 16, 2000) (App. 382), the court first ruled that a post office box number is not a sufficient disclosure under § 504B.181. Since there was a dispute in fact over whether an actual street address had been provided, the case was scheduled for trial with disclosure being the first issue to be raised. Tr. at 3. The court then ruled that since the tenant's habitability defense was based on a notice of intent to condemn the property, the court would not require the tenant's to deposit any rent into court. Id. 5-8. See Igherighe v. _____, No. HC-1011001519 (Minn. Dist Ct. 4th Dist. Oct. 10, 2001 and Feb. 19, 2002) (Appendix 519) (costs awarded and file expunged where action was dismissed where plaintiff landlord of Section 8 Voucher tenant failed to served Section 8 office, plaintiff disclosed only a post office box and not a street address to tenant, plaintiff pled rent due from Section 8 and not the tenant, and plaintiff named a non-tenant as a defendant); Franklin v. Bryd, No. HC-000103511 (Minn. Dist. Ct. 4th Dist. Jan. 14, 2000) (Appendix 390) (Dismissal where lease provided only a post office box address for the landlord, in violation of § 504B.181); Swartwood v. Dampier, No. UD-1950803520 (Minn. Dist. Ct. 4th Dist. Aug. 23, 1995) (Appendix 172); Pocklington v. Brown, No. UD-1950113512 (Minn. Dist. Ct. 4th Dist. Jan. 26, 1995) (Appendix 98); Mathers v. Davis, No. UD-1911002512 (Minn. Dist. Ct. 4th Dist. Oct. 11, 1991) (Appendix 4.B); Anderson v. Whitney, No. 510527, Transcript at 5-8 (Minn. Dist. Ct. 4th Dist. May 23, 1989) (Appendix 5).
The statute extends to and is enforceable against any successor, owner, caretaker, manager, or individual to whom rental payments for the premises are made. § 504B.181 (formerly § 504.22). But see O'Connor v. Miller, UD-194-0211505 (Minn. Dist. Ct. 4th Dist. Mar. 24, 1994) (Appendix 178) (new landlord complied with disclosure statute, even though he filed case 10 days after receiving title through tax forfeiture).
The landlord also must plead compliance with the statute. See Stein v. _______, No. HC 000804513 (Minn. Dist Ct. 4th Dist. Aug. 18, 2000) (Appendix 577) (dismissal where landlord failed to plead compliance with address disclosure statute, Minn. Stat. § 504B.181 (formerly § 504.22)); Henz v. Bronzin, No. (Minn. Dist. Ct. 6th Dist. June 4, 1991) (Appendix 4.C) (dismissal for plaintiff's failure to plead compliance with Minn. Stat. § 504.22 (now § 504B.181)). The landlord's failure to post a rental license under local ordinance may be additional proof that the landlord has not complied with the disclosure statute as well.
The landlord's use of a commercial mailbox service, while appearing to be a street address, is not a proper address under Minn. Stat. § 504B.181 (formerly § 504.22) because the landlord could not be personally served there. Towns v. Dailey, No. UD-01970912521 (Minn. Dist. Ct. 4th Dist. Oct. 13, 1997) (Appendix 300); Smith v. Reese, No. UD-1961203542 (Minn. Dist. Ct. 4th Dist. Jan. 3, 1997) (Appendix 293) (Box at private commercial mail collection/distribution center is not an address where plaintiffs could be personally served, in violation of § 504.22 (now § 504B.181)).
Changes in the landlord's name less than 30 days before filing might violate the statute. Compare Sterling Properties, L.L.C. v. Skjefte, No. UD-1961113528 (Minn. Dist. Ct. 4th Dist. Nov. 22, 1996) (Appendix 295a) (Dismissal for failure to disclose name 30 days before filing action, where Sterling Properties, Inc. conveyed property to Sterling Properties, L.L.C., and the latter filed the action that same day), with Carriagehouse Apartments v. Stewart, No. UD-1970107501 (May 13, 1997) (Appendix 249) (Landlord complied with § 504.22 (now § 504B.181) where rental documents referred to "Gene Glick Management Corp." and a local address, signs at the address contained variations on that name, and the tenant knew the location of the building).
Some local ordinances require a landlord who does not live in the local area to maintain a contact person who resides in the area. Minneapolis Code of Ord. § 244.1840 (within 16-county metropolitan area); (Appendix 11.A); Brooklyn Center Ordinance § 12-904 (within metropolitan counties). (Appendix 244a) Failure to comply with such ordinances may be a violation of § 504B.181 (formerly § 504.22). Anda Construction v. Peoples, No. UD-01970321516 (Minn. Dist. Ct. 4th Dist. Apr. 2, 1997) (Appendix 244) (Violation of local contact ordinance violates § 504.22 (now § 504B.181)). See City of Minneapolis v. Swanson, No. C5-97-312, 1997 WL 471182 (Minn. Ct. App. Aug. 19, 1997) (Appendix 251) (Unpublished: Ordinance requiring landlord to list residential address rather than post office box on rental license is constitutional).
Persons conducting a business under an assumed trade name must register the name with and disclose the name of the principles to the Secretary of State. An assumed name is a name which does not set forth the true name of every person interested in the business. Minn. Stat. § 333.01. The terms "person" and "true name" are defined broadly. § 333.001, subds. 2, 3.
The required certificate to be filed must state the name of the business, the business address, and the true name of each person conducting or transacting the business, and the addresses of such persons. § 333.01. If any event occurs which makes any statement in the certificate incorrect, the business must file an amended certificate within sixty (60) days. § 333.035.
A person conducting a business violation of §§ 333.001 to 333.06 may not commence or defend against a civil action based upon contracts or transactions of the business before a certificate has been filed. § 333.06. If such an action is filed before the certificate has been filed with the Secretary of State, the opposing party may raise the failure to file the certificate as a defense. All proceedings must be stayed until the certificate is filed. If the opposing party prevails in the action, the opposing party also shall be entitled to tax $250.00 in costs, in addition to other statutory costs. If the opposing party does not prevail in the action, the opposing party shall be entitled to deduct $250.00 from the judgment otherwise recoverable. Id.
Tenants' advocates should not ignore the issue just because the name of the plaintiff is a personal name rather than a trade name, since the statute focuses on whether the person acts through an unregistered entity. In Timberland Partners III. LLP the Henning, No. UD-2960711201 (Minn. Dist. Ct. 4th. Dist. July 22, 1996) (Appendix 197), the court correctly focused on the entity doing business as opposed to the entity listed in the case caption. The court found that the plaintiff’s use of a business name not listed on the complaint and not registered with the Secretary of State violated the statute. The court ordered the case to go ahead only after plaintiff demonstrated compliance with the statute by properly registering the trade name. See also Grimmer v. Svoboda, No. UD-1960923520 (Minn. Dist. Ct. 4th Dist. Oct. 29, 1996) (Appendix 188) (settlement: $250 penalty for failing to register trade name of the plaintiff's management company to be paid from rent paid into court).
In Hedlund v. Potter, No. C3-91-1542 (Minn. Dist. Ct. 10th Dist.), the action was commenced by
an individual. The court initially found that the individual plaintiff was not a proper party, since he
simply was a trustee for an entity that he had formed, and that he provided no evidence stating his
relationship to the entity. The court then found that the entity was doing business under a third name,
that of a mobile home park, but had failed to register this name with the Secretary of State. The court
ordered the action stayed until plaintiff complied with the statute, and ordered that defendants were
entitled to a setoff in the amount of $250.00 under Minn. Stat. § 333.06. Order (Nov. 26, 1991)
(Appendix 4.C.1). After plaintiff registered with the Secretary of State, the court dismissed the action for
improper service of the summons and complaint by the landlord's caretaker. Order (Dec. 31, 1991)
(Appendix 4.C.2). Defendants then moved for taxation of $250.00 in costs for each Defendant under
Minn. Stat. § 333.06. Plaintiff argued that the court could not award costs since § 333.06 requires
commencement of a civil action, and since the action really had not been commenced because it was
dismissed for improper service. The court rejected plaintiff's argument, finding that the action was not
void at its commencement but merely was voidable upon proper motion. The court ordered taxation of
costs of $250.00, but treated the Defendants as one party and did not order multiple awards of costs.
Order for Judgment (Feb. 8, 1992) and Judgment (Mar. 3, 1992) (Appendix 4.C.3).
Relief is available even where the plaintiff ultimately prevails. Rush Riverview Apartments v. _____, No. C3-01-0996 (Minn. Dist. Ct. 10th Dist. Aug. 7, 2001) (Appendix 567) (Judge Clifford) (violent conduct and noise constituted material non-compliance in HUD subsidized project; writ stayed for 7 days and until plaintiff complies with the trade name registration statute and pays defendant $250 in costs).
A foreign corporation which transacts business in Minnesota must hold a certificate of authority from the Secretary of State. Minn. Stat. § 303.03. A foreign corporation may not sue in Minnesota courts without obtaining the certificate. Minn. Stat. § 303.20. See Uptown Classic Properties JV1, LLC v. _____, No. HC 1030123529 (Minn. Dist Ct. 4th Dist. Apr. 9, 2003) (Appendix 588) (dismissal and expungement where foreign limited liability company had no state certificate of authority under Minn. Stat. § 322B.94); Uptown Classic Properties JV1, LLC v. _____, No. HC 1030123527 (Minn. Dist Ct. 4th Dist. Apr. 9, 2003) (Appendix 587); Cohn-Hall-Marx Co. v. Feinberg, 214 Minn. 584, 588, 8 N.W.2d 825, 826-27 (1943); E.C. Bogt, Inc. v. Ganley Bros. Co., 185 Minn. 442, 443-44, 242 N.W. 338, 338-39, (1932).
5. Tenant in possession for at least three years
An eviction (unlawful detainer) action is unavailable where the tenant has "been in quiet possession [of the premises] for three years next before the filing of the complaint, after determination of the leasehold estate . . ." Minn. Stat. § 504B.311 (formerly § 566.04).
The meaning of the statute is unclear. In Berg v. Wiley, the Minnesota Supreme Court noted in dictum that the statute reflects the policy choice of the legislature that tenants in possession for at least three years can be evicted only in an ejectment action. 264 N.W.2d 145, 151 n.8 (Minn. 1978) (Berg II). In Priordale Mall Investors v. Farrington, 390 N.W.2d 412 (Minn. Ct. App. 1986) (Priordale Mall), the Court of Appeals held that the Berg II Court did not intend to change its earlier holding that the statute only prohibited eviction (unlawful detainer) actions commenced more than three years after expiration of the lease. Id. at 414, citing Alworth v. Gordon, 81 Minn. 445, 453, 84 N.W. 454, 457 (1900), Suchaneck v. Smith, 45 Minn. 26, 27, 47 N.W. 397, 397 (1890). Chief Judge Popovich dissented in Priordale Mall I, arguing that Berg II, as the latest pronouncement of the Supreme Court on the issue, must be followed. 390 N.W.2d at 415.
6. Failure to state the facts that authorize recovery of the premises
In an eviction (unlawful detainer) action, the plaintiff must plead in the complaint "the facts which authorize the recovery of possession.” Minn. Stat. § 504B.321 (formerly § 566.05) (emphasis added). See Mac-Du Properties v. LaBresh, 392 N.W.2d 315, 317, 318 (Minn. Ct. App. 1986). See also Minn. R. Gen. P. 604. The complaint must set forth a legally sufficient claim for relief. Mankato & Blue Earth County Housing & Redevelopment Authority v. Critzer, No. C2-92-1712, 1995 WL 130608 (Minn. Ct. App. Mar. 28, 1995), Finance and Commerce 48 (Mar. 31, 1995) (Appendix 101).
The statute appears to require more than mere notice pleading used in other civil actions. See Minn. R. Civ. P. 8.01. This is consistent with the summary nature of eviction (unlawful detainer) actions, where the defendant has little time to prepare a defense and possibly no opportunity for discovery. Pleading "the facts which authorize recovery" of the premises should require more than mere conclusory statements. For example, rather than state that the tenant breached the lease, the complaint should specifically allege the facts which lead to the conclusion of breach of the lease. Mollins v. Persaud, No. UD-1940712552 (Minn. Dist. Ct. 4th Dist. July 22, 1994) (Appendix 73) (complaint must include lease and be more specific as to grounds for eviction, where defendant claimed the complaint failed to state dates and times of alleged violations, specific lease provisions violated, names of persons allegedly living on the property, names of neighbors stating complaints, and the precise nature of those complaints).
The court may strike or dismiss the inadequately pled claims, and allow adequately pled claims to proceed. Mei Jen Chen v. _____, No. HC 040106505 (Minn. Dist Ct. 4th Dist. Jan. 13, 2004) (Appendix 538A) (rent claim stricken as vague, notice claim and retaliation defense scheduled for trial).
a. Pleading compliance with statutory preconditions for the action
Where a statute or regulation sets out preconditions for commencement of an action, facts establishing compliance must be pleaded. Biron v. Board of Water Commissioners, 41 Minn. 319, 320 43 N.W. 482, 482 (1889). Such statutes include the following subjects:
(1) Who may commence the action.
Minn. Stat. §§ 481.02, subd. 3(13), 504B.285 (formerly § 566.03); Minn. R. Gen. P. 604. See discussion, supra, at VI.D.1.
(2) Description of the premises.
Minn. Stat. § 504B.321 (formerly § 566.05); Minn. R. Gen. P. 604.
(3) Compliance with the disclosure statute.
Minn. Stat. § 504.22 (now § 504B.181). See discussion, supra at VI.D.2. Rule 604 requires that the complaint contain "a statement of how plaintiff has complied with Minnesota Statues 504.22 (now § 504B.181) by written notice to the defendant, by posting or by actual knowledge of the defendant." A simple statement that the landlord complied with § 504B.181 (formerly § 504.22) may not comply with Rule 704, since it requires a statement of how the landlord has complied with § 504B.181 (formerly § 504.22). See Stein v. _______, No. HC 000804513 (Minn. Dist Ct. 4th Dist. Aug. 18, 2000) (Appendix 577) (dismissal where landlord failed to plead compliance with address disclosure statute, Minn. Stat. § 504B.181 (formerly § 504.22)); Henze v. Bronzin, No. (Minn. Dist. Ct. 6th Dist. June 4, 1991) (Appendix 4.C) (dismissal for failure to plead compliance with § 504.22 (now § 504B.181)); Charboneau v. Johnson,, No. UD-1950817510 (Minn. Dist. Ct. 4th Dist. Aug. 30, 1995) (Appendix 81).
(4) Compliance with the trade name statute.
Minn. Stat. §§ 333.01-333.06. See discussion, supra at VI.D.3.
(5) Compliance with the foreign corporations registration statutes.
Minn. Stat. §§ 303.03-303.20. See discussion, supra at VI.D.4.
(6) Compliance with the statutory and regulatory requirements of the public and government subsidized housing programs.
See discussion, infra at VI.E.12, VI.F.10., VI.G.10; Okotete v. Courtney UD-1931222507 (Minn. Dist. Ct. 4th Dist. Jan. 7, 1994) (Appendix 103) (failure to plead subsidized tenancy, subsidized eviction requirements and whether plaintiff complied with them, and only generic allegations of breach without any details, names or dates); Parkview Assoc. v. Woodard, No. UD-1940912558 (Minn. Dist. Ct. 4th Dist. Sep. 23, 1994) (Appendix 44) (dismissal of complaint that failed to state premises were federally subsidized housing, federal eviction requirements, and whether plaintiff complied with requirements); Reitman v. Smith, No. UD-1940720534 (Minn. Dist. Ct. 4th Dist. Aug. 2, 1994) (Appendix 45) (dismissal of complaint that failed to state applicability of Section 8 federal laws and rules, and did not include the Section 8 lease); Fragale v. Sims, No. UD-1930802515 (Minn. Dist. Ct. 4th Dist. Aug. 11, 1993) (Appendix 4.D.1) (dismissal for failure to give notice and failure to plead §8 tenancy, eviction requirements and whether plaintiff complied with requirements); Loring Towers Apartments Limited Partnership v. Redcloud, No. UD-1921210529 (Minn. Dist. Ct. 4th Dist. Jan 20, 1993) (Appendix 11.I.5) (complaint failed to state notice requirement, that notice was given, and that defendant was allowed informal conference); Krieg v. Clark, No. UD-4920204900 (Minn. Dist. Ct. 4th Dist. Mar. 4, 1992) (Appendix 4.D); Riverside Plaza Limited Partnership v. Lee, No. UD-1901009585 (Minn. Dist. Ct. 4th Dist. Oct. 18, 1990) (Appendix 5.A). See generally RFT & Assocs. v. Smith, 419 N.W.2d 109, 111 (Minn. Ct. App. 1988); Housing and Redev. Auth. of Waconia v. Chandler, 403 N.W.2d 708, 711 (Minn. Ct. App. 1987); Hoglund-Hall v. Kleinschmidt, 381 N.W.2d 889, 895 (Minn. Ct. App. 1986).
(7) Compliance with the manufactured (mobile) home park lot rental statutes.
Minn. Stat. Ch. 327C. See discussion, infra at VI.E.11, VI.F.7, VI.G.11.
(8) Compliance with the statutory requirement that a tenant holding over after sale of the property, foreclosure of a mortgage in expiration of the time for redemption, or termination of a contract to convey the property, has received at least one month's written notice of the termination of tenancy as a result of the sale, foreclosure, or termination.
Minn. Stat. § 504B.285 (formerly § 566.03), subd. 1. See discussion, infra at VI.F.11-12.
(9) Allegations of unlawful activity.
Minn. Stat. § 504B.171 (formerly § 504.181). Brogdon Properies, LLC v. _____, No. 1030826501 (Minn. Dist. Ct. 4th Dist. Sep. 4, 2003) (Appendix 479) (dismissed for lack of specific allegations of illegal activity); Ford v. _____, No. HC-1020325505 (Minn. Dist. Ct. 4th Dist. Apr. 26, 2002) (Appendix 500) (Section 8 voucher, plaintiff failed to allege drug use with any particularity; action dismissed and defendant awarded costs and disbursements); Johnson v. _____, No. HC 1001005514 (Minn. Dist Ct. 4th Dist. Oct. 18, 2000) (Appendix 526) (directed verdict entered on drug claim where witness testified no drugs were found in raid, and testimony on earlier controlled purchase of drugs was not pled; nonpayment of rent was by Section 8 and not tenant, so tenant not required to pay filing fee to redeem); MPHA v. _________, No. UD-1970123530 (Minn. Dist. Ct. 4th Dist. Feb. 19, 1997) (Appendix 273) (Dismissal where complaint failed to state with sufficient specificity facts supporting drug paraphernalia claim).
Barzallo v. _____, No. 27-CV-HC-08-4535 (Minn. Dist. Ct. 4th Dist. June 23, 2008) (Appendix 598) (eviction dismissed where landlord pled nonpayment of rent without stating an amount due, and the tenant bringing people to the property); Mei Jen Chen v. _____, No. HC 040106505 (Minn. Dist Ct. 4th Dist. Jan. 13, 2004) (Appendix 538A) (rent claim stricken as vague, notice claim and retaliation defense scheduled for trial); Igherighe v. _____, No. HC-1011001519 (Minn. Dist Ct. 4th Dist. Oct. 10, 2001 and Feb. 19, 2002) (Appendix 519) (plaintiff pled rent due from Section 8 and not the tenant, and plaintiff named a non-tenant as a defendant).
Berg v. _____, No. 27-CV-HC-08-3505 (Minn. Dist. Ct. 4th Dist. May 19, 2008) (Appendix 599)
(eviction dismissed where landlord failed to comply with order to provide tenant with detailed factual
basis for eviction action); Hurt v. Johnston, No. HC-000103513 (Minn. Dist. Ct. 4th Dist. Jan. 14, 2000)
(Appendix 398) (Landlord's motion to amend complaint denied and action dismissed where landlord
failed to attach the lease to the complaint to support a claim of breach of lease, and the landlord's claims
of breach by unsanitary conditions in that tenant knew information about the landlord required by statute
to be disclosed to the tenant were not pled with sufficient specificity); Walters v. ______, No. HC
010706519 (Minn. Dist Ct. 4th Dist. July 25, 2001) (Appendix 592) (dismissal of breach claim for lack
of specificity); Westfalls Housing Ltd. Partnership v. Scheer, No. C8-93-227 (Minn. Dist. Ct. 5th Dist.
Nov. 30, 1993) (Appendix 26) (dismissal for alleging only that defendant had broken terms of lease, and
termination of lease due to infraction notices).
c. Litigating claims not raised in the complaint
The plaintiff may not litigate claims and facts not raised in the complaint. Mac-Du Properties v. LaBresh, 392 N.W.2d 315, 318 (Minn. Ct. App. 1986) (plaintiff only could be entitled to restitution of the property based on claims in the complaint, and not other grounds: the trial court “lacked jurisdiction to order restitution for reasons which had nothing to do with respondents' unlawful detainer complaint”).
7. Unauthorized practice of law
See discussion, supra at V.J.
a. Management agents for plaintiff
In Hedlund v. Potter, No. C3-91-1542 (Minn. Dist. Ct. 10th Dist.), the action was commenced by an individual. The court found that the individual plaintiff was not a proper party, since he simply was a trustee for an entity that he had formed, and that he provided no evidence stating his relationship to the entity. Order (Nov. 26, 1991) (Appendix 4.C.1). See Meldahl and SJM Prop. v. _____, No. 1050923509, Order on Referee Review at 18-19 (Minn. Dist. Ct. 4th Dist. Feb. 23, 2006) (Appendix 609) (judge reversed referee and ordered dismissal where agent was not authorized by principal); Erickson v. Kane, C4-92-600535 (Minn. Dist. Ct. 6th Dist. Apr. 7, 1992) (person who appeared with plaintiff who was not an authorized management agent of the owner of rental property was prohibited from commencing, maintaining, conducting or defending on behalf of plaintiffs an unlawful detainer action under Minn. Stat. § 481.02) (Appendix 4.H). See Standing Order Regarding Court Appearances by Non-Attorney, Non-Managing Agents (Minn. Dist. Ct. 2nd Dist. June 9, 1995) (Appendix 84).
In Nicollet Restoration, Inc. v. Turnham, 486 N.W.2d 753 (Minn. 1992), the Court held that a corporation must be represented by a licensed attorney when appearing in district court. It is important to closely review this decision, because the Court went into great detail discussing the history of the rule, its policy basis, and whether the Legislature had limited the effect of the rule.
This was not a new issue for the Court. The Court reviewed the history of the principle, both in Minnesota around the country, requiring that a corporation must be represented by a licensed attorney when appearing in court, regardless of whether the person seeking to represent the corporation is a director, officer or shareholder.
Minnesota follows the common law rule that a corporation may appear only by attorney. We first touched upon this rule in Banks v. Pennsylvania Ry. Co., 111 Minn. 48, 126 N.W. 410 (1910). In finding jurisdiction over a foreign corporation which appeared generally and entered an answer on the merits, we stated:
It may be conceded, as claimed, that the courts of this state have no jurisdiction over a foreign corporation, except as it is brought within the purview of our statutes; but it is equally true that such a corporation may voluntarily appear by attorney and submit its person to the jurisdiction of the courts of the state, precisely as it may by attorney come into such courts for the purpose of enforcing its claims.
Banks, 111 Minn. at 54, 126 N.W. at 411 (emphasis supplied). Sixteen years later, we directly addressed the common law rule in Cary & Co. v. F.E. Satterlee & Co., 166 Minn. 507, 208 N.W. 408 (1926). We held:
The ruling refusing to permit Mr. Francis C. Cary to appear as attorney for plaintiff was correct. Mr. Cary is no longer an attorney at law, and the right of a party to a suit in court to appear in person therein does not entitle him to appear for a corporation, even if he owns all its capital stock for the corporation is a distinct legal entity.
Cary, 166 Minn. at 509, 208 N.W. at 409.
Nicollet Restoration, Inc., 486 N.W.2d at 754. The Court went into detail discussing the policy considerations for the rule.
In order to understand the importance of this prohibition, it is necessary to examine its underlying rationale. A non-attorney agent of a corporation is not subject to the ethical standards of the bar and is not subject to court supervision or discipline. The agent knows but one master, the corporation, and owes no duty to the courts. In addition, a corporation is an artificial entity which can only act through agents. To permit a lay individual to appear on behalf of a corporation would be to permit that individual to practice law without a license. The purpose behind attorney licensing requirements is the protection of the public and the courts from the consequences of ignorance or venality. Strong Delivery Ministry, 543 F.2d at 33 (citation omitted). The Seventh Circuit Court of Appeals explained:
The rule in these respects is neither arbitrary nor unreasonable. It arises out of the necessity, in the proper administration of justice, of having legal proceedings carried on according to the rules of law and the practice of courts and by those charged with the responsibility of legal knowledge and professional duty.
....
Were it possible for corporations to prosecute or defend actions in person, through their own officers, men unfit by character and training, men, whose credo is that the end justifies the means, disbarred lawyers or lawyers of other jurisdictions would soon create opportunities for themselves as officers of certain classes of corporations and then freely appear in our courts as a matter of pure business not subject to the ethics of our profession or the supervision of our bar associations and the discipline of our courts.
Id. at 33-34 (citations omitted). Thus, there are strong public policy considerations on which the prohibition is based. [Any] departure [from the general policy that corporate representation must be by lawyers] should always be cautiously controlled to avoid the dangers inherent in representation by those without legal training or professional discipline and standards. Employers Control Serv. Corp. v. Workers Compensation Bd., 35 N.Y.2d 492, 364 N.Y.S.2d 149, 323 N.E.2d 689, 692 (1974).
Nicollet Restoration, Inc., 486 N.W.2d at 754-75.
The Court then addressed the argument that Minn. Stat. § 481.02, subd. 2 (1990) authorizes a corporation to appear by or through a non-attorney agent.
Minn. Stat. § 481.02, subd. 2 provides, in pertinent part, that: “No corporation, organized for pecuniary profit, except an attorney's professional corporation ... by or through its officers or employees or any one else, shall maintain, conduct, or defend, except in its own behalf when a party litigant, any action or proceeding in any court in this state ....”
We reject this argument for two reasons. First, a careful reading of Minn. Stat. § 481.02, subd. 2, indicates that the legislature intended to grant the power to corporations to appear in court by or through its officers, employees or other agents when they are a party litigant to an action. Contrary to petitioner's interpretation, this does not mean that the officer, employee or agent appearing on behalf of a corporation may be a non-attorney. Under the common law, a corporation still must be represented by a licensed attorney when appearing in district court whether or not the attorney is an officer, employee or other agent. If district courts are to handle their increasingly crowded and complex dockets efficiently and justly, it is important that clients' causes be presented by persons trained and licensed to do so.
Even assuming that Minn. Stat. § 481.02, subd. 2, could be construed to permit a corporation to appear by or through a non-attorney agent, such a construction would raise serious constitutional problems. Since corporations are distinct legal entities, any individual attempting to appear on behalf of the corporation would, in effect, be practicing law. Based on the legislature's power to enact criminal statutes, it is clear that the legislature has the authority to determine who may or may not be prosecuted for the unauthorized practice of law. This, however, does not mean that the legislature may decide who may properly practice law before the courts of this state. Under Article 3, Section 1 of the Minnesota Constitution, this power is vested solely in the judiciary. Minneapolis Star & Tribune Co. v. Housing & Redevelopment Auth., 310 Minn. 313, 318, 251 N.W.2d 620, 623 (1976). Art. 3, § 1 provides:
Division of Powers. The powers of government shall be divided into three distinct departments: legislative, executive and judicial. No person or persons belonging to or constituting one of these departments shall exercise any of the powers properly belonging to either of the others except in the instances expressly provided in this constitution.
In Sharood v. Hatfield, 296 Minn. 416, 425, 210 N.W.2d 275, 280 (1973), we held that, [T]he power to make the necessary rules and regulations governing the bar was intended to be vested exclusively in the supreme court, free from the dangers of encroachment either by the legislative or executive branches. Id. at 425, 210 N.W.2d at 280 (citation omitted). We explained:
Under our form of government, where the judicial constitutes an independent branch, the character of those who stand in this relation to the court should be of the court's choosing and under the supervision of the court, and other branches of the government should not be permitted to embarrass or frustrate judicial functions by the intrusion of incompetent or improper officers upon the courts. Courts will defer to reasonable legislative regulation, but this deference is one of comity or courtesy rather than an acknowledgement of power. This view is without doubt supported by the great weight of authority.
Sharood, 296 Minn. at 426, 210 N.W.2d at 281 (citation omitted) (emphasis supplied). Therefore, legislative enactments which purport to authorize certain classes to practice law in the courts of this state are not controlling upon the judiciary. As such, we reaffirm our conviction that a corporation must be represented by a licensed attorney when appearing in district court.
Nicollet Restoration, Inc., 486 N.W.2d at 755-76.
The only issue which was new to the Court in Nicollet Restoration, Inc. was that the action as issue first originated in conciliation court. The Court held that where the action originated was irrelevant. Id. In doing so, the Court affirmed both the decision of the trial court judge and the Court of Appeals. 486 N.W.2d at 753, affirming 475 N.W.2d 508 (Minn. Ct. App. 1991).
In World Championship Fighting v. Janos, 609 N.W.2d. 263 (Minn. Ct. App. 2000), the Court of Appeals affirmed a district court dismissal of removal to district court from conciliation court by a corporation not represented by counsel. Citing Nicollet Restoration Inc., the Court stated that “we perceive no reason why a corporation unrepresented by counsel should be able to commence a district court action by removing a case from conciliation court when it is not allowed to do so by filing a complaint.” 609 N.W.2d. at 265. In response to the claim that state statute provided otherwise, the Court quoted Nicollet: “[L]egislative enactments which purport to authorize certain classes to practice law in the courts of this state are not controlling upon the judiciary. As such, we reaffirm our conviction that a corporation must be represented by a licensed attorney when appearing in district court.” Id., citing 486 N.W.2d at 756. The Court concluded that the filing of the notice of removal was an appearance under Minn. R. Civ. P. 5.01, and could not be done without counsel. Id. at 265.
In Towers v. Schwan, No. A07-1311, 2008 WL 4224462 (Minn. Ct. App. Sept. 16, 2008) (unpublished), the Court of Appeals held that the district court erred in allowing a corporation to proceed in an eviction action without the representation of legal counsel, quoting extensively from both Nicollet Restoration, Inc. and World Championship Fighting. Id. at *2. The Court noted that while the litigants did not brief the impact of Minn. Stat. § 481.02, subd. 3(12) (2006), which provides that any authorized management agent of an owner of rental property used for residential purposes, whether the management agent is a natural person, corporation, partnership, limited partnership, or any other business entity, is not authorized to appear before a district court or the court of appeals or supreme court pursuant to an appeal if the agent it not a licensed attorney. Still, the Court stated that “the language of this statute comports with Nicollet Restoration, but we recognize that there could be alternative readings of this statute.” Id. The Court also noted that it expressed “no opinion at this time as to whether Minn. R. Gen. Pract. 603 is inconsistent with Minn. Stat. § 481.02, subd. 3. See Minn. R. Gen. Pract. 601 (stating that the rules pertaining to housing court shall apply to housing court practice except where they are in conflict with applicable statutes ). Id.
The Towers decision appears to be the impetus for the request of the Minnesota Multi-Housing Association that the Supreme Court Advisory Committee on the Rules of General Practice adopt a rule allowing corporations to appear in district court eviction actions without representation by a licensed attorney. On April 23, 2009, the Committee considered a proposal and decided to take no action on the proposal. Several members commented that it was not the role of the Committee to propose a rule different than the rulings of the appellate courts. The Commitee concluded
It was noted that the committee has taken up the issue of corporate representation in district court before, and it keeps popping up, but the Minnesota Supreme Court has decided it as a matter of law as discussed in Nicollet Restoration, Inc. v. Turnham, 475 N.W.2d 508 (Minn. Ct. App. 1991), aff’d 486 N.W.2d 753 (Minn. 1992). The proposal in essence asks the committee to overrule caselaw, and it is generally not the role of the committee to attempt to overrule caselaw. An appeal would be an appropriate means to raise this issue, e.g. , as an amicus.
Supreme Court Advisory Committee on the Rules of General Practice, Meeting Summary, at 9-10 (Apr. 23, 2009).
The lower courts have not consistently applied Nicollet Restoration, Inc. In Meldahl and SJM Prop. v. _____, No. 1050923509, Order on Referee Review at 15-18 (Minn. Dist. Ct. 4th Dist. Feb. 23, 2006) (Appendix 609), the judge reversed referee and ordered dismissal where corporation represented by president. See FTK Properties, Inc. v. US Benefit Association, LLC, No. HC 010518508 (Minn. Dist Ct. 4th Dist. June 1, 2001) (Appendix 503), the court dismissed the eviction without prejudice where three shareholder corporation landlord of commercial property was represented by a person who was not an attorney and did not have a power of attorney). See Hedlund v. Otten, No. CX-93-08 (Minn. Dist. Ct. 10th Dist. Mar. 2, 1993) (Appendix 4.F.1) ( dismissed where trust was similar to corporation); Welsh v. Clark, No. UD-1921120502 (Minn. Dist. Ct. 4th Dist. Dec. 3, 1993) (Appendix 4.F.2) (dismissed). See Jafer Enterprises, Inc. v. Peters, No. UD-1920701512 (Minn. Dist. Ct. 4th Dist. July 21, 1992) (action continued) (Appendix 4.F); Cities Management, Inc. v. Thompson, No. UD-1920720517 (Minn. Dist. Ct. 4th Dist. Aug. 4, 1992) (action continued) (Appendix 4.G). Corporations which are not in good standing may be susceptible to challenge as a proper party. See discussion, supra at VI.D.3.
On the other hand, a referee did not apply the decision in Nicollet Restoration, Inc. to landlord corporations in Rio Hot Properties, Inc. v. Judge, No. UD-1981005518 (Minn. Dist. Ct. 4th Dist. Oct. 19, 1998) (Appendix 362A) (Denial of tenant's motion to dismiss, on the grounds that plaintiff was a sole shareholder corporation, Nicollet did not deal with residential property, Nicollet involved an appeal from conciliation court and was not an unlawful detainer action, and Minn. Stat. §481.02 allows non-attorneys to maintain unlawful detainer actions). Counsel should argue that none of these factors counteract the strong language in Nicollet which prohibit non-attorney representation of corporations.
Some courts have issued standing orders on corporations acting without attorneys. Memorandum of Chief Judge Lawrence Cohen (Minn. Dist Ct. 2nd Dist. Mar. 30, 2001) (Appendix 538) (citing Nicollet Restoration, Inc. v. Turnham, 486 N.W.2d 753 (Minn. 1992), “a licenced attorney must represent any corporation appearing in the Housing Court of the Second Judicial District”); In re Morning Sun Investments, Inc., Standing Order (Minn. Dist Ct. 4th Dist. Mar. 21, 2001) (Appendix 523) (corporation “must be represented by a licensed attorney when appearing in District Court,” citing Nicollet Restoration, Inc.).
c. Limited Partnerships and Limited Liability Companies
Citing Nicollet Restoration, courts have held that limited partnerships and limited liability companies must be represented by an attorney. Westfalls Housing Ltd. Partnership v. Scheer, No. C8-93-227 (Minn. Dist. Ct. 5th Dist. Nov. 30, 1993) (Appendix 26) (limited partnership); Remas Properties, LLC v. Student, No. UD-1940705517 (Minn. Dist. Ct. 4th Dist. July 19, 1994) (Appendix 27) (limited liability company).
8. Failure to attach to the complaint or provide at the initial hearing a copy of the termination notice or lease (Hennepin and Ramsey County Housing Court)
Minn. R. Gen. Prac. Rule 604 provides that in an action for holding over after termination of the lease, plaintiff must attach a copy of the termination notice, if any, to the complaint or provide it to defendant or defendant's counsel at the initial appearance, unless the plaintiff does not possess a copy of the notice, or if the defendant acknowledges receipt of the notice at the hearing. Similarly, if the action is for breach of the lease, plaintiff must attach a copy of the lease, if any, to the complaint or provide it to defendant or defendant's counsel at the initial appearance unless the plaintiff does not possess a copy of it.
Since plaintiff has the option of either attaching the termination notice or lease to the complaint or providing it at the initial appearance, the defendant should not move to dismiss the action before the first hearing if these documents are not attached to the complaint. However, if plaintiff does not provide these documents at the initial appearance, defendant should immediately move to dismiss the action for failing to comply with Rule 704. Even if plaintiff supplies these documents at the initial hearing, counsel should consider moving for a continuance if counsel has not seen these documents before.
a. Breach claims
Meldahl and SJM Prop. v. _____, No. 1050923509, Order on Referee Review at 19-20 (Minn. Dist. Ct. 4th Dist. Feb. 23, 2006) (Appendix 609) (judge reversed referee and ordered dismissal of breach of lease claim in eviction case claiming breach of lease and nonpayment of rent for failing to give tenant copy of lease); Pham v. _____, No. HC 030131517 (Minn. Dist Ct. 4th Dist. Feb. 13, 2003) (Appendix 560) (dismissal for failure to present lease for breach claim and notice for holdover claim, and for waiver of notice by acceptance of rent); Hurt v. Johnston, No. HC-000103513 (Minn. Dist. Ct. 4th Dist. Jan. 14, 2000) (Appendix 398) (Landlord's motion to amend complaint denied and action dismissed where landlord failed to attach the lease to the complaint to support a claim of breach of lease, and the landlord's claims of breach by unsanitary conditions in that tenant knew information about the landlord required by statute to be disclosed to the tenant were not pled with sufficient specificity.; Reitman v. Smith, No. UD-1940720534 (Minn. Dist. Ct. 4th Dist. Aug. 3, 1994) (Appendix 45) (subsidized housing lease not attached to complaint); Mollins v. Persaud, No. UD-1940712552 (Minn. Dist. Ct. 4th Dist. July 22, 1994) (Appendix 73).
b. Notice claims
Floy v. _____, No. HC-010821507 (Minn. Dist Ct. 4th Dist. Sep. 13, 2001) (Appendix 499) (combined eviction and emergency relief action: dismissal of eviction breach claim since tenant actions did not violate the lease; dismissal of notice claim since notice was not attached to complaint and there was no evidence of when notice was given; tenant raising condemnation as a habitability defense did have to pay rent into court; landlord who rented out condemned property was liable for $1900 in rent and deposit paid plus $5700 additional treble damages, plus $500 in moving expenses, for $8100; deadlines for payment; expungement of eviction case); O’Brian v. ________, No. HC 1010402506 (Minn. Dist Ct. 4th Dist. Apr. 18, 2001) (Appendix 552) (breach claims dismissed where oral lease contained no right of re-entry clause; notice claim dismissed where landlord failed to attached notice to complaint, and failed to prove notice was given; expungement granted); B&J Property Management v. Gates, No. UD-01970602519 (Minn. Dist. Ct. 4th Dist. June 12, 1997) (Appendix 247) (Dismissal for improper service, failure to register trade name, and failure to attach notice to quit and lease to complaint).
9. Failure to provide defendant with a copy of the lease before commencement of the action
Minn. Stat. § 504B.115 (formerly § 504.015) requires the landlord to provide a copy of the lease to the tenant. In actions to enforce a written lease, except for nonpayment of rent, disturbing the peace, malicious destruction of property, or violation of the drug covenant in § 504B.171 (formerly § 504.181), failure to provide a copy of the lease is a defense. A signed acknowledgment by the tenant of receipt is prima facie evidence of receipt. The landlord may overcome the defense by establishing that the tenant had actual knowledge of the provision. In Meldahl and SJM Prop. v. _____, No. 1050923509, Order on Referee Review at 19-20 (Minn. Dist. Ct. 4th Dist. Feb. 23, 2006) (Appendix 609), the judge reversed the referee and ordered dismissal of breach of lease claim in eviction case claiming breach of lease and nonpayment of rent for failing to give tenant copy of lease.
Some local ordinances require the landlord to give the tenant a copy of the lease. Minneapolis Code of Ordinances § 244.280 (Appendix 138) requires the landlord to give the tenant a copy of the lease within five days after it is signed by both parties. The tenant also may be entitled to rent abatement for the landlord's violation of this section. See discussion, infra, at VI.E.1.d.(3) (Violation of covenants of habitability).
10. Failure to timely file the affidavit of service (Fourth District; Hennepin and Ramsey County Housing Courts)
Minn. R. Gen. P. 605 requires the plaintiff to file the affidavit of service by 3:00 p.m. three business days before the hearing, and gives the court the discretion to strike the action. See Okoiye v. Washington, No. UD-1990708534 (Minn. Ct. Dist. July 22, 1999) (Appendix 425) (dismissal for failure to file affidavit of service; expungement motion granted; tenant awarded costs); Pillsbury Partnership v. Loomer, No. UD-1941121505 (Minn. Dist. Ct. 4th Dist. Dec. 2, 1994) (Appendix 105) (dismissal for failure to file affidavit of service).
11. Section 8 Existing Housing Certificate and Voucher Programs: Failure to give notice to the public housing authority
Requirements for eviction and defenses to evictions in public and government subsidized housing are discussed under the headings of nonpayment of rent, holding over and breach of lease cases.
The Section 8 Existing Housing Certificate and Voucher Programs provide the tenant with a housing certificate or voucher, which allows the tenant to find a landlord willing to participate in the program. The housing authority sends a monthly rent subsidy, called a Housing Assistance Payment (HAP), to the landlord and the tenant pays the remaining share of the rent. The landlord may terminate the tenancy only for serious or repeated violations of the lease, violation of federal, state, or local law which imposes an obligation on the tenant in connection with occupancy of the unit, or other good cause, except at the end of the term. The provisions of the HAP contract between the landlord and the housing authority, and the lease between the landlord and the tenant mirror the requirements of the regulations.
a. Under old regulations
Under the old regulations, the landlord had to notify the housing authority when it commenced an
eviction (unlawful detainer) action. 24 C.F.R. §§ 882.215(c)(1) and 887.213(c) provided that the owner must
notify the housing authority in writing of the commencement of procedures for termination of the tenancy,
at the same time that the owner gives notice to the tenant under state or local law. The notice to the housing
authority could be given by furnishing to the housing authority a copy of the notice to the tenant. If the
owner failed to give such notice to the housing authority, the action had to be dismissed. Carlson v. Lavine,
No. UD-1930104506 (Minn. Dist. Ct. 4th Dist. Jan. 22, 1993) (Appendix 5.J.3) (dismissed where service
of HRA occurred 7 days after service on defendant and only three days before hearing; service was not "at
same time" as service on defendant); Shun v. Jasper, No. UD-1920605513 (Minn. Dist. Ct. 4th Dist. July 7,
1992) (dismissal where Plaintiff failed to serve public housing authority with copy of lease termination letter
and summons and complaint until after Defendant raised the issue in court as a violation of 24 C.F.R. §
882.215(c)(4) (1992)) (Appendix 5.J.1).
b. New regulation
The United States Department of Housing and Urban Development (HUD) published an extensive
revision of the Section 8 Certificate and Voucher regulation. 60 Fed. Reg. 34,660 (July 3, 1995). The
regulations became effective October 2, 1995. The regulations retain the requirement that the landlord notify
the housing authority, but the regulations changed the language to state: "The owner must give the HA
[housing authority] a copy of any owner eviction notice to the tenant." 24 C.F.R. § 982.310(e)(2)(ii), 60
Fed. Reg. at 34,705. "Owner eviction notice means notice to vacate, or a complaint or other initial pleading
used under State or local law to commence an eviction action." § 982.310(e)(2)(ii), 60 Fed. Reg. at 34,705
(Appendix 109). Cases decided under the old regulations remain good law under the new regulations, except
that the new regulations do not state when the landlord must notify the public housing authority. Wright v.
_____, No. 27-CV-HC-08-4603 (Minn. Dist. Ct. 4th Dist. Sep. 24, 2008) (Appendix 626) (expungement
granted where landlord did not notify Section 8 Office was eviction action); Meldahl and SJM Prop. v.
_____, No. 1050923509, Order on Referee Review at 14-15 (Minn. Dist. Ct. 4th Dist. Feb. 23, 2006)
(Appendix 609) (judge reversed referee and ordered dismissal of eviction in part for plaintiff's failure to give
notice to public housing authority); Nelson v. _____, No. HC 031007508 (Minn. Dist Ct. 4th Dist. Oct. 16,
2003) (Appendix 548) (dismissal where Section 8 landlord did not notify housing authority); Rio Hot
Properties, Inc. v. ____, No. HC 021024517 (Minn. Dist Ct. 4th Dist. Nov. 7, 2002) (Appendix 566)
(dismissal where Section 8 landlord did not notify housing authority of eviction action at the same time it
notified tenant, although landlord notified housing authority afterwards); Igherighe v. _____, No. HC-1011001519 (Minn. Dist Ct. 4th Dist. Oct. 10, 2001 and Feb. 19, 2002) (Appendix 519) (costs awarded and
file expunged where action was dismissed where plaintiff landlord of Section 8 Voucher tenant failed to
served Section 8 office, plaintiff disclosed only a post office box and not a street address to tenant, plaintiff
pled rent due from Section 8 and not the tenant, and plaintiff named a non-tenant as a defendant); SJM
Properties, Inc. v. _____, No. HC 020402501 (Minn. Dist Ct. 4th Dist. Apr.. 11, 2002, Feb. 12, 2003)
(Appendix 570) (dismissal where Rental Assistance for Family Stabilization (RAFS) Program landlord
failed to serve the Section 8 office; different notice periods for landlord and tenant might be proper; costs
and disbursements awarded, which may be credited against rent; expungement granted later).
A landlord may not use an eviction (unlawful detainer) action to terminate the interest in lease to property of a tenant who has filed a bankruptcy action, without first obtaining relief from the automatic stay. Otten v. Washington, No. UD-1910617506 (Minn. Dist. Ct. 4th Dist. July 3, 1991) (Appendix 5.K) (dismissal of complaint alleging nonpayment of rent for period following bankruptcy filing); 11 U.S.C. §§ 362, 541. See Minneapolis Public Housing Authority v. Sterling, No. UD-1980604506 (Minn. Dist. Ct. 4th Dist. Jul. 6, 1998) (Appendix 350) (writ quashed by stipulation where writ issued after filing of bankruptcy); In re Sudler, 71 B.R. 780 (Bankr. E.D.Pa. 1987) (tenancy rights not terminated prior to bankruptcy filing where tenant had not been put out of property as of time of filing).
The landlord also may not proceed against a co-tenant of the bankruptcy debtor where such a proceeding would affect the property of the bankruptcy estate and adversely affect the interest of the bankruptcy debtor. Otten, citing In re Otero Mills, Inc., 25 B.R. 1018, 1021 (Bankr. D.N.M. 1982). A landlord who files bankruptcy listing the premises as part of the bankruptcy estate relinquishes control of the premises to the bankruptcy court, and does not have the right to file an unlawful detainer action until the bankruptcy court abandons the property. See Grandco Management v. Wielding, No. UD-1921202525 (Minn. Dist. Ct. 4th Dist. Dec. 16, 1993) (Appendix 4.B.3).
13. Pending parallel litigation
In some cases a landlord may file an eviction (unlawful detainer) action as a way to get around defending an action already brought by the tenant. The court may dismiss or stay the action as being incorrectly commenced when the pending parallel action would properly resolve the dispute. Rice Park Properties v. Robins, Kaplan, Miller & Ciresi, 532 N.W.2d 556 (Minn. 1995) (Minnesota Supreme Court decision reversing the Court of Appeals and affirming the district court decision to stay an unlawful detainer action pending final disposition of a related and earlier filed declaratory judgment action commenced by the tenant); Stein v. J.D. White, Inc., No. CO-91-2164 (Minn. Ct. App. Apr. 21, 1992), Finance & Commerce B24 (April 24, 1992) (Appendix 0.F) (affirmed dismissal). But see Park Drive Partnership v. Granse No. C7-96-401 (Minn. Ct. App. Sep. 24, 1996), Finance & Commerce at 38 (Sep. 27, 1996) (Appendix 193) (unpublished decision: pending separate quiet title action did not preclude unlawful detainer action, which determines who has the superior right of possession, but does not determine title; the defendant cannot assert title, equitable rights or counterclaims; the defendant did not present any evidence demonstrating a greater right of possession than the plaintiff).
Tenants' advocates also should consider a motion in the pending action to restrain the landlord from filing the eviction (unlawful detainer) action. See Temporary Retraining Orders, supra at V.D.
14. Failure to join an indispensable party
In some cases, the alleged breach of the lease on the part of the tenant may have been caused by a third party. For instance, if a public housing authority providing a rent subsidy for the tenant to the landlord withholds the subsidy or incorrectly calculates the subsidy, the landlord might file an eviction (unlawful detainer) action for nonpayment of rent against the tenant. The tenant may argue that the action should be dismissed for failure to join an indispensable party, or that the party should be joined under Minn. R. Civ. P. 19. See Lang v. Terpstra, No. UD-1940207512 (Minn. Dist. Ct. 4th Dist. June 12, 1994) (Appendix 70) (storage company added as necessary party on defendant's motion regarding property disposition). The landlord might respond that the action is a summary proceeding in which parties who do not have a possessory interest in the premises could not be joined. The tenant could respond by asserting that the plaintiff would have an adequate remedy in an ejectment action.
In Hanson v. Trom, No. UD-1950926503 (Minn. Dist. Ct. 4th Dist. Nov. 3, 1995) (Appendix 82), the landlord alleged non-payment of rent against one co-tenant, without naming the other co-tenant. The court held that the landlord failed to name an indispensable party, since the court could not enter final judgment without affecting the interests of the co-tenant. See Tri Star Developers, LLC v. _____, No. HC 010109514 (Minn. Dist Ct. 4th Dist. Oct. 17, 2001) (Appendix 584) (improper service on employee of business who was not an officer and not authorized to accept service; defendant business was incorrectly named; default judgment vacated and action dismissed and expunged).
The writ cannot be enforced against a subtenant who was not a party to the eviction (unlawful detainer) action nor named in the writ of restitution. See Kowalenko v. Haines, No. C6-85-1365 (Minn. Ct. App., July 24, 1985) (attached as Appendix 4). In Kowalenko, the petitioner had subleased the apartment from the former tenants. The writ was enforced against the petitioner, pursuant to an unlawful detainer action against former tenants, but not the petitioner. The petitioner was not named in the writ. The court ordered the landlord to return possession of the apartment and petitioners personal property to her, pursuant to Minn. Stat. § 504B.375 (formerly § 566.175).
If the tenant commences an action including all of the parties before the landlord commences the eviction (unlawful detainer) action, the tenant could argue for dismissal based on the existence of the pending parallel action. See Stein v. J.D. White, Inc., No. C0-91-2164 (Minn. Ct. App. Apr. 21, 1992), Finance & Commerce B24 (April 24, 1992) (Appendix O.F).
The tenant also could request that the court continue the action to allow the tenant to serve a third party complaint on the indispensable party, and order an expedited period such as seven days for the third party Defendant to appear and respond.
15. Lack of jurisdiction over Indian trust property
The state courts do not have jurisdiction over claims involving the right of an enrolled member of an Indian tribe to possession of property held in trust for Indians by the United States. White Earth Housing & Redevelopment Authority v. J.F., No. C8-91-224 (Minn. Dist. Ct. 9th Dist. Feb. 5, 1992) (Appendix 24); All Mission Indian Housing Authority v. Silvas, 680 F. Supp. 330 (C.D. Cal. 1987); 28 U.S.C. § 1360(b).
16. Action is inappropriate method to resolve complex claims
a. Manufactured (mobile) home park lot home repossession
In Nygren v. Nix, No. C1-96-42 (Minn. Dist. Ct. 9th Dist. Jan. 25, 1996) (Appeal 199), the defendant agreed to purchase a manufactured (mobile) home park lot home from the plaintiff by a promissory note which stated monthly payments, and rented the land below it by a lease which did not state rent payments. The plaintiff brought an action for non-payment of rent and late fees, and the defendant answered that the action should be dismissed because the action was not an appropriate forum since the dispute was more properly governed by the Manufactured Home Repossession Security Act (MHRSA), Minn. Stat. § 327.62 et seq. The court dismissed the action for preparing and issuing a summons which should have been prepared and issued by the court, and for not signing the complaint.
b. Domestic partners.
Domestic partners may or may not be in a landlord-tenant relationship, and if not, an eviction (unlawful detainer) action not be an appropriate forum to determine their possessory interests in the property. In Shustarich v. Fowler, UD 1960604520 (Minn. Dist. Ct. 4th Dist. July 5, 1996) (Appendix 176), Plaintiff and defendant first lived in defendant's home. Then plaintiff and defendant moved from her home to a second property, and the parties then living at the second property moved to defendant's old home. Plaintiff took title to the new property, and defendant contributed several thousand dollars from the sale of her home to a new roof and appliances. The parties kept separate expenses. After defendant obtained an order for protection, plaintiff gave notice and filed an unlawful detainer action. The court concluded that plaintiff failed to establish a landlord-tenant relationship, defendant was entitled to assert an interest in the premises, and an unlawful detainer action was a summary remedy inappropriate to try issues of title or to substitute for an action in ejectment, and denied restitution of the premises. See In re Estate of Ericksen, 337 N.W.2d 671 (Minn. 1983). But see Stock v. Beaulieu (Minn. Dist. Ct. 9th Dist. Mar. 9, 1995) (Appendix 140) (domestic partners were in landlord-tenant relationship; plaintiff retaliated against defendant for reporting a crime of domestic abuse committed by the plaintiff in which the defendant was the victim).
In Nygren v. Nix, No. C1-96-42 (Minn. Dist. Ct. 9th Dist. Jan. 25, 1996) (Appendix 199), the court dismissed the action for preparing and issuing a summons which should have been prepared and issued by the court, and for not signing the complaint.
18. Landlord's preparation of summons
In Nygren v. Nix, No. C1-96-42 (Minn. Dist. Ct. 9th Dist. Jan. 25, 1996) (Appendix 199), the court dismissed the action for preparing and issuing a summons which should have been prepared and issued by the court, and for not signing the complaint.
19. Action or claim is premature
When the complaint alleges an act that has not yet occurred, such as nonpayment of future rent or fees or failing to move at expiration of a notice period that has not yet expired, the action or claim should be dismissed as being premature or not ripe. The court should consider only present possessory interests of the parties.
In Eagan East Ltd. Partnership v. Powers Investigations, Inc., 554 N.W. 2d 621 (Minn. Ct. App. 1996), the commercial landlord demanded from the commercial tenant a prospective and retroactive rent increase after the square footage used by the tenant was remeasured. When the tenant failed to pay the additional rent, the landlord filed an eviction (unlawful detainer) action. The trial court held that the rent increase clauses in the lease were ambiguous and could not be applied retroactively from the new square footage measurement, but could be applied prospectively. The landlord then announced a new prospective rent increase, and in a subsequent order of the trial court, the court ruled that the landlord was entitled to the rent increase and the tenant was not entitled to attorney’s fees under the lease. On appeal, the Court of Appeals held that the trial court’s jurisdiction was limited to determining present possessory rights of the parties, and that the trial court exceeded its jurisdiction by ruling on the prospective rent increase and attorney’s fee issues.
The most common premature cases are notice cases filed before the effective date of the notice. In Walters v. Demmings, No. UD-1990916517 (Minn. Dist. Ct. 4th Dist. Nov. 15, 1999) (Appendix 422), the court dismissed the landlord's notice to quit claim as premature, as the action was filed before the effective date of the notice. See Clobes v. ______, No. HC 010301510 (Minn. Dist Ct. 4th Dist. Mar. 15, 2001) (Appendix 487) (action dismissed as premature where notice set vacate date as March 3 and landlord filed action March 1; costs and disbursements awarded); Ewing Square Associates v. Koerner, No. UD-2910104802 at 2-6 (Minn. Dist. Ct. 4th Dist. Feb. 4, 1991) (Appendix 15.B) (unlawful detainer action dismissed where it was commenced contemporaneously with issuance of the ten day notice of termination); Loring Towers Apartments Limited Partnership v. Redcloud, No. UD-1921210529 (Minn. Dist. Ct. 4th Dist. Jan 20, 1993) (Appendix 11.I.5).
Rent claims also can be premature. BIRDMA, LLC v. _____, No. HC 1011102511 (Minn. Dist Ct. 4th Dist. Dec. 7, 2001) (Appendix 476) (action filed on the 2nd was premature to claim service fee due on the 5th; tenant tendered but landlord refused rent; landlord failed to prove amount of utility bills; lease did not comply with shared meter statute conditions). See discussion, infra, at VI.E.15.2.
20. Plaintiff's voluntary dismissal
Plaintiff may dismiss the action without order of the court only before the tenant serves the answer. Minn. R. Civ. P. 41.01(a). If the answer contains a counterclaim, the court cannot dismiss the action unless the court retains jurisdiction to hear the counterclaim. Rule 41.01(b). While counterclaims generally are not available in eviction (unlawful detainer) actions. If a rent abatement claim is viewed as a counterclaim as opposed to a set off, the court would have to adjudicate the claim even if the eviction claim were dismissed. See Breach of Covenants of Habitability, infra at VI.E.1.a.
If the plaintiff dismisses an action and then refiles, the court may assess costs against the plaintiff from the first action and stay the second action until the plaintiff has complied with the order. Rule 41.04. If the plaintiff dismisses the second action, the dismissal is an adjudication on the merits. Rule 41.01(a).
The landlord should not be able to enforce provisions of a written lease signed under duress. Duress is a defense to a contract "when there is coercion by means of physical force or unlawful threat, which destroys one's free will and compels compliance with the demands of the party exerting the coercion." Minnesota courts have not recognized the defense of economic duress. St. Louis Park Investment Co. v. R.L. Johnson Investment Co., 411 N.W.2d 288, 291 (Minn. Dist. Ct. at 1987) (No duress where contract for deed vendee willingly executed deed after consulting with attorney and was not subjected to physical force or unlawful threats, even though forced to move from a previous location by time constraints); Cedar Associates LLP v. Curtis, No. UD-1970108508 (Minn. Dist. Ct. 4th Dist. May 20, 1997) (Appendix 250) (Tenant did not prove duress where tenant alleged landlord required her to sign lease under threat of immediate eviction).
22. Filing case in violation of consumer fraud order
On occasion courts have found landlords fraudulently filing and prosecuting unlawful detainer and other actions in violation of state consumer protection laws, and have ordered the landlords to obtain judge approval before filing new actions. In In re Application of Okoiye (Jan. 7, 1998) (Appendix 354E), the landlord sought in forma pauperis status to file another unlawful detainer action. The court reminded the landlord of the requirement for court approval for filing, and concluded that the landlord had given improper notice and had not submitted substantive proof supporting claims which he had litigated before. See Le v. _____, No. HC 02-7952 (Minn. Dist Ct. 4th Dist. May 14, 2002) (Appendix 530) (ordered landlord who filed several actions again defendant and other tenants in violation of federal subsidized housing termination regulations to secure approval of Chief Judge prior to filing any eviction actions); Okoiye v. Washington, No. UD-1981029901 (Minn. Ct. Dist. June 29, 1999) (Appendix 424) (landlord not allowed to file unlawful detainer action where claims were controlled by previous court orders). Landlords may try to avoid the effect of such orders by having cases brought in the name of a spouse or other person. Amsler v. Touliot, No. UD-1970908519 (Minn. Dist. Ct. 4th Dist. Sep. 24, 1997) (Appendix 245) (landlord ordered to obtain judge approval when his wife files cases on properties in which he maintains an interest).
Issues of domestic abuse can come up in a number of ways in unlawful detainer actions. Some cases involve the abuser trying to evict the cohabiting victim after the victim obtains a restraining order. The victim may be able to get the case dismissed on the grounds of no landlord-tenant relationship, or retaliation. Shustarich v. Fowler, No. UD-1960604520 (Minn. Dist. Ct. 4th Dist. July 5, 1996) (Appendix 176) (No landlord-tenant relationship); Stock v. Beaulieu, Minn. Dist. Ct. 9th Dist. Mar. 9, 1995) (Appendix 140) (Retaliation).
Other cases involve the landlord trying to evict the victim based on the actions of the abuser or the actions of the victim in dealing with the abuse. The landlord might file an unlawful detainer action for nonpayment of rent after the victim excludes the abuser from the household and the abuser no longer contributes toward rent. The victim could argue that eviction is not appropriate where the victim is not responsible for the nonpayment of rent, and only needs additional time to obtain assistance with the rent. Maxtin Housing Authority v. McLean, 328 S.E.2d 290 (N.C. 1985) (Public housing: default on payment of rent rested with abuser and not the remaining victim); 614 CO. v. D. H. Overmayer, 297 Minn. 395, 396, 211 N.W.2d 891, 893 (1973), affirming First and Second Interlocutory orders, No. 204678 (Minn. Dist. Ct. 2nd Dist. Apr. 22 and July 9, 1972) (Appendix 54) (Affirmed trial court orders allowing commercial tenant one month to pay amount in default).
The landlord might give a victim a notice to quit in a month-to-month tenancy after the victim defends against the abuser, or excludes the abuser from the property. The victim could raise a retaliation defense against the landlord, since tenants are protected against retaliation for actions they take to enforce their rights under any laws, not just housing law. Minn. Stat. § 504B.285 (formerly § 566.03). See discussion, infra, VI.F.3.
The landlord might file an action for breach of lease where the conduct of the abuser offends other tenants, neighbors or the landlord's staff. The victim could argue that the court should evict the abuser if a household member and allow the victim to remain, or allow the victim to remain if the victim has excluded the abuser from the property on the grounds that forfeiture of the tenancy is not appropriate.
In Steven Scott Management, Inc. v. Scott, No. CA-98-09527 (Minn. Dist. Ct. 2d Dist. Oct. 28, 1998) (Appendix 367), after one tenant violently assaulted his domestic partner, he pled guilty to a felony, and was sentenced to workhouse incarceration, chemical dependency treatment and anger management counseling. The assailant complied with his sentence and committed no other assaults. The landlord found out about the incident six months later, gave notice for substantial annoyance and endangerment, and commenced an unlawful detainer action to evict both tenants. The court held that the claim against the victim was in response to her call to the police and prohibited by Minn. Stat. § 504.215 (now § 504B.205), the victim did not endanger others by allowing the assailant to remain in the household, it would be unconscionable to evict the assailant where he was sincere in his rehabilitative efforts and had complied with his sentence and had not endangered others in the manufactured (mobile) home park lot and the tenants had cured any violation which had occurred. On appeal, in Steven Scott Management, Inc. v. Scott, No. C7-98-2024 (Minn. Ct. App. June 8, 1999) (unpublished), the Court of Appeals affirmed the finding that the victim had not violated Minn. stat. 327C.09 or committed a material violation of the lease, as there was no evidence of any annoyance or danger to other residents. However, the Court reversed the trial court as to the assailant, concluding that a finding that he violated the lease and the statute was sufficient to compel issuance of an order against him. See Akron Metropolitan Housing Authority v. Rice, No. 88-CV-04013 (Ohio Mun. Ct., Akron, June 22, 1988), 23 Clearinghouse Rev. 322 (1989) (Appendix 309) (Court could enter judgment in eviction against one household member but not the rest of the family, which was innocent). See discussion, infra, VI.G.28. (forfeiture). But see Phillips Neighborhood Housing Trust v. Brown, 564 N.W.2d 573 (Minn. Ct. App. 1997) (Affirmed eviction of entire household when one co-tenant violated the lease by engaging in illegal drug activity). See generally E. Lauer, Housing and Domestic Abuse Victims: Three Proposals for Reform in Minnesota, 15 Law and Inequality 471 (Spring 1997).
Tenants facing domestic abuse have remedies other than eviction defense. Tenants have used rent escrow and tenant remedies actions, claiming that the landlord was obligated under the lease, a covenant of quiet enjoyment, or the covenant of habitability to maintain the property fit for the use intended by the parties to take action against an abuser, or that the circumstances amounted to constructive eviction. In _____ v. Country Village Apartments, C8-02-14178 (Minn. Dist. Ct. 1st Dist. July 8, 2002) (Appendix 436), the tenant obtained a restraining order against the father of her child. She called the police for subsequent incidents of threats and property damage, but did not feel safe. She gave notice to the landlord that she would vacate, claiming that the property was not fit for her use under Minn. Stat. § 504B.161 (formerly § 504.18). When the landlord did not agree to end the tenancy, she filed an rent escrow action under Minn. Stat. § 504B.385 (formerly § 566.34). The court found that she had been constructively evicted, and ordered her released from the lease, ending her rent liability, and that the landlord return her deposit minus the cost of damage beyond ordinary wear and tear. See Person v. Torchwood Management, No. UD-1920604543 (Minn. Dist. Ct. 4th Dist. July 6, 1992) (Appendix 205) (rent escrow action: landlord's failure to effectively abate loud and abusive language by neighboring tenants, noisy parties, and unjustified harassment by other tenants violated § 504.18 (now § 504B.161)); Colonial Court Apartments, Inc. v. Kern, 292 Minn. 533, 163 N.W.2d. 770 (1968) (damages action: affirmed trial court finding of constructive eviction for landlord's failure to respond to tenant's complaints about neighboring tenants).
In Times Square Shopping Center, L.L.P., v. The Tobacco City, Inc., 585 N.W. 2d 791 (1998), the tenant challenged the summons as not stating that an original complaint had been filed with the District Court, as required by Minn. Stat. § 504B.321 (formerly § 566.05). The Court concluded that the function of the eviction summons was not negated by the minor technical error in the standard form.
25. Failure to use written lease
Minn. Stat. § 504B.111 (formerly § 504.012) provides that a “landlord of a residential building with 12 or more residential units must have a written lease for each unit rented to a residential tenant.... A landlord who fails to provide a lease, as required under this section, is guilty of a petty misdemeanor.” Generally a contract entered into in violation of a statute or ordinance which imposes a prohibition and a penalty for an action is void and unenforceable. However, the court first must consider the nature and circumstances of the contract in light of the statute or ordinance. The court will not infer that the legislative body intended the contract to be void unless such is necessary to accomplish its purpose. The courts have voided contracts where the violations offended important public policies with respect to health and safety of the public, and have upheld contracts where the legislative intent did not indicate that its sanction should apply where the violation is slight, not seriously injurious to the public order, and where no wrong has resulted from want of compliance. New Bonn Company v. Herman, 271 Minn. 105, 135 N.W.2d 222 (1965).
Since the eviction action is for allegedly unlawful detention or possession of the property, the case is moot if the tenant has vacated the property prior to the court hearing. Mootness is the doctrine of standing set in a time frame: “the personal interest that must exist at the commencement of the litigation (standing) must continue throughout its existence (mootness).” Nathan v. Town Centre Self Storage, LLC, No. A06-461, 2007 WL 446831 (Minn. Ct. App. Feb. 13, 2007) (unpublished) (quoting Kahn v. Griffin, 701 N.W.2d 815, 821 (Minn. 2005). Mootness occurs “if an event occurs that resolves the issue or renders it impossible to grant effective relief.” Id. (quoting Isaacs v. Am. Iron and Steel Co., 690 N.W.2d 373, 376 (Minn. Ct. App. 2004), review denied (Minn. Apr. 4, 2005). See Olson v. _____, No. HC 031008504 (Minn. Dist Ct. 4th Dist. Oct. 21, 2003) (Appendix 556) (dismissed where tenant vacated before hearing but after action commenced); Ukatu v. _____, No. HC 0307614501 (Minn. Dist Ct. 4th Dist. July 30, 2003) (Appendix 586) (dismissal for no license at time of filing, even though landlord later obtained license; eviction case is moot when tenants have vacated; expungement granted).
It is common for the court to strike a case when the plaintiff does not appear to proceed with it. Tenants still should appear and ask that the case be dismissed. Filas v. _____, No. HC 040218516 (Minn. Dist Ct. 4th Dist. Mar. 2, 2004) (Appendix 498) (dismissal with prejudice where tenant appeared but plaintiff did not).
The tenant cannot use statute of frauds to avoid a contract that she approved and signed. MM Home Builders, Inc. v. Williams, No. C3-02-521, 2002 WL 31247999 (Minn. Ct. App. Oct. 8, 2002) (unpublished).
The tenant may waive claims related to financial obligations to the landlord by paying amounts later to be challenged. White v. Ford, No. C2-02-2048, 2003 WL 21694419 (Minn. Ct. App. July 22, 2003) (unpublished) (tenant waived claim that landlord improperly modified lease to require tenant payment of utilities by paying for utilities for 9 months after notice).
Many statutory protections cannot be waived. See discussion, infra, at VI.G.12.
Some claims may be barred by a statute of limitations. Boston Housing Authority v. Tyler, N0. 00-01016 (Mass. Dist. Ct., Boston Housing Ct. Jan. 21, 2004) (Appendix 478) (dismissal of eviction action not brought within two year statute of limitations for forfeiture; 6 year statute of limitations for contract actions did not apply to evictions).
The Minnesota statute of limitations period is six years for claims under a contract or statute, or concerning personal property, fraud, and other listed claims, Minn. Stat. § 541.05, and two years for penalties created by statute. Minn. Stat. § 541.07.
31. Servicemembers Civil Relief Act
On December 19, 2003, the new Servicemembers Civil Relief Act replaced the Soldiers’ and Sailors’ Civil Relief Act. Pub. L. No. 108-189 (2003), 117 Stat 2835, 50 App. U.S.C.A §§ 501-594. It extends coverage to members of the National Guard serving “more than 30 consecutive days of active duty. The court may grant a stay of proceedings in a number of circumstances, should grant a stay in some, and must grant a stay in others.
Absent a court order, a landlord may not evict a servicemember or the dependents of a servicemember from a residential lease when the monthly rent is at or below $2400 per month for the year of 2003, and $2465 in 2004, with a formula to calculate the rent ceiling for subsequent years. Pub. L. No. 108-189 §301, 50 App. U.S.C.A. § 531.
In any eviction case, if a servicemember whose ability to pay the rent is materially affected by military service, the court shall grant a request for (1) a stay of the action for 90 days, unless equity requires a shorter or longer stay, or (2) adust the obligation under the lease to preserve the interests of all parties. The court also may grant the relief on its own motion, and may grant landlord as equity may require. It is a misdemeanor for a person to knowingly take part or attempt to take part in an eviction.
E. Nonpayment of rent defenses.
1. Breach of the covenants of habitability
Implied in every oral and written residential lease are three covenants or obligations of the landlord. Minn. Stat. § 504B.161 (formerly § 504.18), subd. 1 (emphasis added).
1. That the premises and all common areas are fit for the use intended by the parties.
2. To keep the premises in reasonable repair, except where the disrepair was caused by the willful, malicious or irresponsible conduct of the tenant or tenant's agent.
3. Maintain the premises in compliance with applicable state and local housing maintenance, health, and safety laws, except where the violation was caused by the willful, malicious, or irresponsible conduct of the tenant or tenant's agent. Included in "health and safety laws" are: (a) The weatherstripping, caulking, storm window, and storm door energy efficiency standards for rental property contained in Minn. Stat. § 216C.27, subd. 1, 3. See Minn. Stat. § 216C.30, subd. 5, Minn. R. § 7655.0400; and (b) Fire extinguisher and smoke detector installation requirements. Minn. Stat. §§ 299F.361, 299F.362.
The "fit for intended use covenant" includes the landlord's statutory obligations to be the bill payer and customer of record for utility services supplied to a building through one meter where the service covers more than one unit or the common areas. Minn. Stat. § 504B.215 (formerly § 504.185). See Utilities, infra, at VI.E.4.
The statute is to be liberally construed. Id. The covenants of habitability and the covenant to pay rent are mutual and dependant, and all or part of the rent is not due when the landlord has breached the covenants. Fritz v. Warthen, 298 Minn. 48, 54, 213 N.W.2d 339, 341-42 (1973). The defendant may raise breach of the covenants as a defense to an action for nonpayment of rent. Id. at 59, 213 N.W.2d at 342.
The fact that a residential tenant operates a business out of the home does not negate operation of the statutory covenants. Swartwood v. Gardner, No. UD-1950929506 (Minn. Dist. Ct. 4th Dist. Oct. 20, 1995) (Appendix 113) (tenants operation of a family day care center at residential rental premises does not relieve landlord of obligations under covenants of habitability).
The parties may not waive or modify the covenants. Minn. Stat. § 504B.161 (formerly § 504.18), subd. 1. Greevers v. Greevers, No. UD-1950628506 (Minn. Dist. Ct. 4th Dist. July 24, 1995) (Appendix 110) (no existence of agreement by tenant reside in condemnable or uninhabitable premises, and such an agreement would be contrary to public policy and in violation of State law).
While the tenant may agree in writing to perform special repairs or maintenance if the agreement is supported by adequate consideration, the agreement does not waive the covenants. § 504B.161 (formerly § 504.18), subd. 2. The tenant's pre-rental inspection of the premises does not defeat the covenants. § 504B.161 (formerly § 504.18) , subd. 3. A lease term stating that the tenant accepts the premises as being in excellent condition is void and contrary to public policy, where the condition of the premises violates the covenants. In Wardin v. Maski, No. C4-97-2245, 1998 WL 481917, at *3 (Minn. Ct. App. Aug. 18, 1998) (unpublished), the Court affirmed the trial court’s application of the statute to a lease requiring the tenant to make repairs.
The lease provided that the respondents would maintain mechanical systems, but the district court found that the lease did not contain a "conspicuous indication * * * to support [Wardin's] contention that [respondents] were obligated to perform specific repairs or maintenance." We agree that the maintenance provision was not specific and was not set forth in a conspicuous writing. The maintenance provision appears on page three of a six-page form lease and is written in the same typeface as the rest of the lease. Also, the maintenance agreement was not supported by any consideration. The district court properly found that respondents were not responsible for maintaining the heating system and water pipes and did not abuse its discretion in abating rent for insufficient utilities.
Id. See State v. Ellis, 441 N.W.2d 134, 137-38 (Minn. App. Ct. 1989) (ultimate responsibility for compliance with the covenants remains with the landlord; landlord's attempt to transfer responsibility to tenant is prohibited).
In Jafer Enterprises, Inc. v. Peters, No. UD-1920701512 (Minn. Dist. Ct. 4th Dist. Aug. 10, 1992) (Appendix 5.P), the landlord and tenant agreed that the rent would be reduced by $50.00 because the tenant agreed to paint the house, install carpet, and do other needed repairs at her cost. The court found that given the condition of the premises and the rent reduction already negotiated between the parties, the tenant still was entitled to a $300.00 per month rent abatement for three months. Id. at 3. See Coleman v. Kopet, No. UD-1000211534 (Minn. Dist. Ct. 4th Dist. Mar. 8, 2000) (Appendix 385) (Adequate consideration to shift the obligation for repairs from the landlord to the tenant must be fair and reasonable under the circumstances; the landlord failed to prove adequate consideration, so the landlord was responsible for making all repairs; rent abatement of $2,925 over ten months (32%) covered by rent paid into court and credits against future rent); Larson v. Cooper, No. UD-1880209557, Order at 6 (Minn. Dist. Ct. 4th Dist. Mar. 21, 1988) (Appendix 6); Greevers v. Greevers, No. UD-1950628506 (Minn. Dist. Ct. 4th Dist. July 24, 1995) (Appendix 110) (no existence of agreement by tenant reside in condemnable or uninhabitable premises, and such an agreement would be contrary to public policy and in violation of State law); U and W, Inc. v. Grove, No. UD-1950403505 (Minn. Dist. Ct. 4th Dist. Apr. 25, 1995) (Appendix 111) (provision stating tenant would provide all maintenance not enforced); Phoenix Group, Inc. v. Phonseya, No. UD-1951004508 (Minn. Dist. Ct. 4th Dist. Nov. 1, 1995) (Appendix 87) (illiterate and vulnerable adult who began paying full rent after stipulated rent abatement did not prove that repairs were completed); Olson v. Brooks, No. UD-1950209512 (Minn. Dist. Ct. 4th Dist. Mar. 7, 1995) (Appendix 112) (landlord failed to prove oral agreement for tenants to make repairs related to items listed by the housing inspector).
The landlord may not charge the tenant for service calls to maintain the property. Meldahl and SJM Prop. v. _____, No. 1050923509, Order on Referee Review at 21-22 (Minn. Dist. Ct. 4th Dist. Feb. 23, 2006) (Appendix 609) (judge reversed referee and ordered lease term requiring payment of $50 service call fee was illegal and unenforceable).
b. The plaintiff must prove that rent was not paid
Often the amount of rent withheld is not in dispute. If it is in dispute, the court should allow litigation of that issue before it determines whether withheld rent should be paid into court. However, as noted below, the court should only consider whether rent should be paid into court as it accrues, rather than back rent withheld. See Kahn v. Greene, No. UD-1940330506 (Minn. Dist. Ct. 4th Dist. May 25, 1994) (Appendix 46) (plaintiff alleged but did not prove part of plaintiff's nonpayment of rent claim); See Z & S Management Company v. Jankowicz, No. UD-1920219515 (Minn. Dist. Ct. 4th Dist. Mar. 24, 1992) (9.B) (plaintiff's alleged but did not prove nonpayment of January and February rent where plaintiff's complex manager had been warned about not promptly submitting rent payments to plaintiff after receiving them from tenants, and plaintiff later fired the manager).
c. The defendant must tender the rent to be withheld or provide adequate security
(1) Fritz factors
In Fritz, 298 Minn. at 61-62, 213 N.W.2d at 343, the court stated that the trial court shall order the defendant to provide security in one of three ways: (1) Pay into court "rent to be withheld" and "any future rent withheld," (2) Deposit such rents in escrow subject to appropriate terms and conditions, or (3) Provide adequate security if such is more suitable under the circumstances. The Fritz Court based the need for payment of rent or security on its concern that the plaintiff may need the rent to pay for expenses of the premises during the unlawful detainer action, and if the plaintiff prevails, the plaintiff would be harmed if the rent could not be collected and the action delayed eviction of the defendant. Id.
(2) The court should not require full payment of back rent into court
Most courts regularly require the defendants to pay into court back and future withheld rent, without consideration of the factors discussed in Fritz and the other methods of providing security outlined in Fritz.
On the other hand, some courts have not required defendants to pay back or future rent into court, without explanation. See Kahn v. Foote, No. UD-194041455503 (Minn. Dist. Ct. 4th Dist. May 6, 1994) (Appendix 47); Erickson v. Foster, No. UD-1871007506 (Minn. Dist. Ct. 4th Dist. Oct. 28, 1987) (Appendix 5.N).
The court should not require prepayment of back rent where the defendant withheld the rent but no longer has all of the money, the defendant has a claim that the covenants have been breached, and there will be little or no delay in proceeding to trial. In such cases, prepayment of back rent should not be required for five reasons.
(a) Fritz does not explicitly require the defendant to post alleged back rent owed as a precondition to litigating the defense
The court's discussion of the need to protect the plaintiff while the action is pending, and the use of the terms "rent to be withheld" and "any future rent" suggest that the court did not envision the posting of back rent. See id. Courts in other jurisdictions have concluded that requiring posting of back rent is inappropriate, since payment of future rent as it becomes due adequately protects the plaintiff while the action is pending. Bell v. Tsintolas Realty Co., 430 F.2d 474, 483 (D.C. Cir. 1970). See Cooks v. Fowler, 459 F.2d 1269, 1274 (D.C. Cir. 1974); Teller v. McCoy, 162 W. Va. 367, , 253 S.E.2d 114, 129-30 (1978) (citing Fritz and other cases); Medford v. Superior Court, 140 Cal. Ct. App. 3d 236, 239-42, 189 Cal. Rptr. 227, 229-30 (1983). See also Carlson v. Mixwell, 412 N.W.2d 771, 772-73 (Minn. Ct. App. 1987) (contract for deed cancellation injunction bond).
(b) Local rules similarly do not explicitly require the defendant to post alleged back rent owed as a precondition to litigating the defense
Rule 608 provides that when a tenant withholds rent and relies on a defense, the defendant shall pay into court an amount "equal the rent due as the same accrues or such other amount as determined by the court to be appropriate as security for the plaintiff, given the circumstances of the case." (emphasis added). Again, the rule does not require payment of the back rent withheld. Indeed, Rule 608 is more flexible than in Fourth Jud. Dist. Spec. R. Prac. 13.09, since it recognizes the court's discretion in determining what would be appropriate security for the plaintiff.
(c) Requiring the posting of back rent may violate due process, since the opportunity to be heard includes the right to answer and defend
Hovey v. Elliott, 167 U.S. 409, 415-17 (1897). See Boddie v. Connecticut, 401 U.S. 371, 377-83 (1971); Griffin v. Illinois, 351 U.S. 12, 17-18 (1956). Such a requirement also may violate equal protection. Lindsey v. Normet, 405 U.S. 56, 74-79 (1972).
(d) Fritz allows for payment of adequate security where it is more suitable under the circumstances
Such security could include where there is no delay, no payment, since there is no harm to the plaintiff, or where there may be some delay, partial payment (where the defendant has a strong claim of breach of the covenants) or documented eligibility for Emergency Assistance from the county or a private social service agency to pay any arrearage remaining after trial on breach of the covenants. Additionally, Rule 608 gives the court the discretion to consider these factors.
In Granco Management v. Moore, No. UD-1920727536 (Minn. Dist. Ct. 4th Dist. Aug. 15, 1992) (Appendix 5.Q), the referee ordered the tenant to deposit withheld rent into court, and allowing a writ of restitution to issue by default if she did not. The tenant requested judge review of the order. The court concluded that the tenant's affidavit and exhibits demonstrated the substantial likelihood of success on the merits of her defense under the covenants of habitability, the tenant was without funds and unable to make the payment ordered by the referee, and the tenant's lack of funds was in part a direct result of the floor of other circumstances which gave rise to her defense. The court concluded that no deposit was appropriate as security for the landlord, and ordered that the referee's order be vacated regarding the deposit with the court.
(e) Requiring prepayment of back rent not only prejudices the defendant with a valid claim, but allows the landlord to evade forced compliance with the covenants
The Fritz Court recognized the importance of facilitating enforcement of the covenants. Id. at 59-60, 213 N.W.2d at 342. The statute is to be liberally construed. Minn. Stat. § 504B.161 (formerly § 504.18), subd. 3. See Bell, 430 F.2d at 483.
(3) Decisions requiring less than full payment into court of back rent.
There have been many cases in which the courts have ordered a tenant to pay into court less than all of the rent withheld, and in some cases, no rent at all. In Larson v. Cooper, No. UD-1880209557 (Minn. Dist. Ct. Mar. 21, 1988) (Appendix 6), the plaintiff claimed $1,805.16 due, and the court allowed the defendant to assert the defense after depositing $1,405.16. Order at 6. In Schwanke v. Magnuson, No. CO-90-0640 (Minn. Dist. Ct. 8th Dist. Jan. 9, 1991) (Appendix 5.L), plaintiff alleged nonpayment of rent of $250.00 in monthly rent for December and January for a total of $500.00. The court allowed defendant to assert the habitability defense after paying $250.00 into court. After trial, the court concluded that plaintiff was entitled to $300.00 in rent, released the $250.00 to the plaintiff and ordered to pay the remaining $50.00.
Recent decisions include Hanson v. Widmark, No. UD-1960625508 (Minn. Dist. Ct. 4th Dist. Aug. 2, 1996) (Appendix 200) (complaint alleged May and June rent of $837.00; court allowed landlord to include claim from July rent, but ordered tenant to pay into court only $1000.00 of $1,570.00 due based upon tenant’s showing that condition of the premises was more than likely a basis for rent abatement); Donovic v. Dodson, No. C2-96-600607 (Minn. Dist. Ct. 6th Dist. Apr. 29, 1996) (Appendix 201) (no rent paid into court); Judnick v. Boje, No. C7-96-600537 (Minn. Dist. Ct. 6th Dist. Apr. 19, 1996) (Appendix 202) (no rent paid into court); Ellis v. McDaniel, No. UD-1960318520 (Minn. Dist. Ct. 4th Dist. Apr. 4, 1996) (Appendix 203) (landlord alleged $735.00 rent due through March; tenants paid into court $840.00 for March and April rent, leaving $315.00 not paid into court).
Earlier decisions include Jensen v. Scott, No. UD-1950203531 (Minn. Dist. Ct. 4th Dist. Feb. 28, 1995) (Appendix 114) (50% of withheld rent paid in to court); Schaapveld v. Crump, No. UD-1951011528 (Minn. Dist. Ct. 4th Dist. Nov. __, 1995) (Appendix 115) (no rent paid into court, based on guarantees from agencies to pay into court $1,100.00 against $1,650.00 allegedly due); Phoenix Group, Inc. v. Phonseya, No. UD-1951004508 (Minn. Dist. Ct. 4th Dist. Nov. 1, 1995) (Appendix 87) ($162.50 (50%) of $325.00 withheld paid into court); Klyberg v. Elkboy, No. UD-1910617511 (Minn. Dist. Ct. 4th Dist. July 3, 1991) (Appendix 5.M) (defendant ordered to pay into court $300.00 of $350.00 withheld in June, and $450.00 for July).
(4) Condemned or condemnable housing
Where the premises have been condemned or are in condemnable condition, the defendant should be allowed to move for summary judgment without prepayment of back rent, since the value of the premises is $0.00. In Brown v. Austin, No. UD-1000203527 (Minn. Dist. Ct. 4th Dist. Feb. 16, 2000) (App. 382), the court first ruled that a post office box number is not a sufficient disclosure under § 504B.181. Since there was a dispute in fact over whether an actual street address had been provided, the case was scheduled for trial with disclosure being the first issue to be raised. Tr. at 3. The court then ruled that since the tenant's habitability defense was based on a notice of intent to condemn the property, the court would not require the tenant's to deposit any rent into court. Id. 5-8. In Erickson v. Foster, No. UD-1871007506 (Minn. Dist. Ct. 4th Dist. Oct. 28, 1987) (Appendix 5.N), the court did not require the defendant to pay withheld rent into court. The court found the apartment to be extensively dilapidated, noting that the housing inspector testified that he posted a notice on the premises that the apartment was subject to condemnation if it was not repaired immediately. The court ordered an entire abatement of past rent due, and ordered future abatement until plaintiff complied with the housing code and Minn. Stat. § 504.18 (now § 504B.161). See Floy v. _____, No. HC-010821507 (Minn. Dist Ct. 4th Dist. Sep. 13, 2001) (Appendix 499) (combined eviction and emergency relief action: dismissal of eviction breach claim since tenant actions did not violate the lease; dismissal of notice claim since notice was not attached to complaint and there was no evidence of when notice was given; tenant raising condemnation as a habitability defense did have to pay rent into court; landlord who rented out condemned property was liable for $1900 in rent and deposit paid plus $5700 additional treble damages, plus $500 in moving expenses, for $8100; deadlines for payment; expungement of eviction case); Walters v. Demmings, No. UD-1990916517 (Minn. Dist. Ct. 4th Dist. Oct. 21, 1999) (Appendix 422) (tenant in consolidated unlawful detainer and emergency relief actions not required to pay withheld rent into court where tenant alleged payment on utility bills for an illegal shared meter); Swanson v. Ivie, No. UD-1950411541 (Minn. Dist. Ct. 4th Dist. May 8, 1995) (Appendix 116) ($250.00 (25%) of $1,000.00 withheld paid into court where notice of condemnation issued).
(5) Disputed rent
Where the plaintiff and defendant disagree on how much rent was withheld, the court should not order the defendant to pay into court more than the tenant claims has been withheld. In Z & S Management Company v. Jankowicz, No. UD-1920219515 (Minn. Dist. Ct. 4th Dist. Mar. 24, 1992) (Appendix 9.B), plaintiff alleged nonpayment of $402.00 for December through February rent. Defendant argued that she owed only $137.00 through March. The court ordered defendant to pay into court $137.00. See Kahn v. Greene, No. UD-1940330506 (Minn. Dist. Ct. 4th Dist. May 25, 1994) (Appendix 46) (defendant not required to pay into court disputed rent claim from before March).
(6) Law firm and agency checks
The Fourth District (Hennepin County) Housing Court issued a May 15, 1996, Order approving acceptance of uncertified checks from Legal Aid and other law firms. The Housing Court retains discretion to decide whether to accept uncertified checks from social service agencies. It takes quite a bit longer for the Court to process and disperse uncertified funds, so if quick dispersal of funds is important to the tenant, the tenant or tenant's attorney should submit funds by certified check. (Appendix 174(A).
(7) Tenant's failure to comply with court's order to pay rent into court.
Generally, if the court orders the tenant to pay rent into court and the tenant does not, the court will allow the landlord to order a writ of restitution. Swartwood v. Rouleau, No. C8-98-1691 (Minn. Ct. App. May 11, 1998) (unpublished) (affirmed order for eviction for nonpayment of rent where tenants claimed habitability violations but did not pay rent into court).
However, in Hanson v. Widmark, No. UD-1960625508 (Minn. Dist. Ct. 4th Dist. Aug. 2, 1996) (Appendix 200), the complaint alleged May and June rent of $837.00. The court allowed landlord to include claim from July rent, but ordered tenant to pay into court only $1000.00 of $1,570.00 due based upon tenant’s showing that condition of the premises was more than likely a basis for rent abatement. While the tenant did not deposit the money in the court authorized eviction, the court decided to determine rent abatement to avoid unnecessary duplication of litigation. In Amsler v. Wright, No. UD-1960502510 (Minn. Dist. Ct. 4th Dist. May 30, 1996) (Appendix 186), the court denied the landlord’s objection to court receipt of tenant’s rent three minutes late, and objection to the source of funds paid into court. See Amsler v. _____, No. 27-CV-HC-09-37 (Minn. Dist. Ct. 4th Dist. Jan 16, 2009) (Appendix 597) (reversing referee order for eviction) (tenant showed good cause for paying rent into court late, where tenant was unable to convert money orders into cash before the court’s deadline).
(8) Appeal of decision ordering tenant to pay rent into court
If the tenant believes that the amount ordered is too high, the tenant could consider appealing to the Court of Appeals for a writ of prohibition, or if the decision was made by a housing court referee, requesting judge review of the decision. See Granco Management v. Moore, No. UD-1920727536 (Minn. Dist. Ct. 4th Dist. Aug. 15, 1992) (Appendix 5.Q) (judge review: court concluded that no deposit was appropriate as security for the landlord, and ordered that the referee's order be vacated regarding the deposit with the court); Writ of Prohibition, infra at XI.
(9) Guarantee of Payment
In some cases the court will accept a guarantee of payment of rent by an agency in lieu of payment of rent into court. Larson v. Bonacci, No. UD-970506542 (Minn. Dist. Ct. 4th Dist. Jun. 18, 1997) (Appendix 265) (Guarantee of payment from Economic Assistance Department); Hemraj v. Hicks, No. UD-1970306508 (Minn. Dist. Ct. 4th Dist. Apr. 8, 1997) (Appendix 259) (Trial scheduled for March 28, tenant paid half of rent into court and court accepted agency guarantee of payment of the remainder by April 10).
(1) Reasonable repair and code compliance covenants
Useful evidence includes reports and/or testimony of housing, health, fire, and energy inspectors, pictures, items from the premises, utilities and other bills, and lay witnesses.
Most large cities have housing maintenance and health codes. In such cities, tenants often will assert the covenants of habitability defense based on a breach of the codes. It is equally important to present evidence of the violations of the codes and the affect of those violations on the tenant. For instance, in two separate cases involving the same landlord and building but different tenants and apartments, the inspections reports listed the same violations of the code. However, apparently due to differences in the extent of the code violations and the affect of the violations on the tenants use and enjoyment of the property, the rent abatements were different. See Zeman v. Arnold, No. UD-1900911501 (Minn. Dist. Ct. 4th Dist. Oct. 11, 1990) (Appendix 6.A); Currington v. Zeman, Nos. UD-1900910517 and UD-1900911502 (Minn. Dist. Ct. 4th Dist. Oct. 11, 1990) (Appendix 6.B).
In City of Morris v. Sax Investments, Inc., 730 N.W.2d 531 (Minn. Ct. App. 2007), the Court of Appeals considered a challenge to a local habitability ordinance on the grounds that it was preempted by the state building code. The Court concluded that the state building code did not preempt local regulation of habitability. On appeal, the Minnesota Supreme Court held that the authority of municipalities to enact and enforce habitability standards for rental housing is constrained by the prohibition on municipal regulation of building code provisions in Minn. Stat. § 16B.62, subd. 1. City of Morris v. Sax Investments, Inc., 749 N.W.2d 1, 3 (Minn. 2008).
A number of Minnesota trial courts have confronted the issue of what condition constitutes violations of the covenants See Jafer Enterprises, Inc. v. Peters, No. UD-1920701512 (Minn. Dist. Ct. 4th Dist. Aug. 10, 1992) (Appendix 5.P) (a defective stove for one month, roach and mice infestation, broken porch door lock, missing porch door screen, broken cold water faucet, trash in the basement, and missing storms and screens); Z & S Management Company v. Jankowicz, No. UD-1920219515 (Minn. Dist. Ct. 4th Dist. Mar. 24, 1992) (Appendix 9.B) (peeling lead paint); Klyberg v. Elkboy, No. UD-1910617511 (Minn. Dist. Ct. 4th Dist. July 3, 1991) (Appendix 5.M) (debris and junk, decayed cellar hatch, buckled floor, inoperable smoke detector, defective light switch, leaking faucets, inadequate toilet installation, roach infestation, water damage, unsecured counter top, floor holes, defective plaster, and lack of storms); Schwanke v. Magnuson, No. C0-90-0640 (Minn. Dist. Ct. 8th Dist. Jan. 9, 1991) (Appendix 5.L) (heater improperly vented, electrified refrigerator, unsafe electrical outlets, and unsafe bathroom floor); Erickson v. Foster, No. UD-1871007506 (Minn. Dist. Ct. 4th Dist. Oct. 28, 1987) (Appendix 5.N) (extensive dilapidation, holes and cracks in walls and ceilings, exposed pluming, defective light fixture, and cracked toilet seat).
In Bebault v. Danko, No. 742053 (Minn. Dist. Ct. 4th Dist. 1978) (Appendix 7) the court found that the tenant did not have an adequate supply of water in her apartment at any time during her tenancy. The court concluded that the landlord had violated the covenant to keep the premises in reasonable repair, in addition to violating the housing code. Id. at 6-8. In contrast, the court found that a deadbolt lock is an amenity rather than a factor affecting habitability, and that the lack of the deadbolt lock did not cause inconvenience or harm to the tenant. Id. at 7. However, deadbolt locks are required by codes in Minneapolis and other municipalities.
In Krong v. Armogost, No. 80-C-3958 (Minn. Dist. Ct. 3rd Dist. Aug. 14, 1986) (Appendix 7.A), tenants commenced a Tenants' Remedies Action claiming violations of the covenants. The court found that numerous violations of the housing code also constituted violations of the covenants to maintain the premises in reasonable repair and fit for the use intended by the parties. The violations included, among other violations, disrepair of ceilings, walls, windows, faucets, and appliances, and mildew on the walls. Id. at 2-3. In another Tenants' Remedies Action, the Dodge County Court found in Hawkins v. McNeillus numerous violations of the covenants to maintain the premises in reasonable repair and fit for the use intended by the parties, including water damage on ceiling, walls, and outlets; mold and mildew in sleeping areas; the lack of operable fire extinguishers and vent fans; and storage of flammable liquids. Nos. 2063, 2131 at 3-7 (May 3, 1984) (Appendix 7.B).
In Gramith v. Thibodeau, No. UD-1941223506 (Minn. Dist. Ct. 4th Dist. Jan. 13, 1995) (Appendix 100), the tenants failed to prove violation of the covenants of habitability and diminished use and enjoyment of the premises, where the items of disrepair were allegedly minor and the landlord corrected the problems. See Wheeler v. _____, No. HC 030905517 (Minn. Dist Ct. 4th Dist. Oct. 3, 2003) (Appendix 594) ($1005 in late fees were excessive, tenant did not prove habitability violations, tenant may redeem).
Recent decisions include Donovic v. Dodson, No. C2-96-600607 (Minn. Dist. Ct. 6th Dist. Apr. 29, 1996) (Appendix 201) (landlord breached covenants of habitability by failing to ensure the unit had hot and cold water at all times, failing to install a deadbolt lock, failing to have an adequate heating system for all rooms of the house, and other code violations); Judnick v. Boje, No. C7-96-600537 (Minn. Dist. Ct. 6th Dist. Apr. 19, 1996) (Appendix 202) (two months where housing conditions were poor, the tenants replaced the stove, furnace (with a grant) and planned to replace the hot water heater).
In Richter v. Czock, No. C7-01-1340, 2002 WL 338181 (Minn. Ct. App. 2002) (unpublished), the court consolidated an eviction action based on holding over after notice with a rent escrow action. The court affirmed trial court rulings that the lease required a 45 day notice, that $100 per month rent abatement would cover only the period in which the landlord knew of the habitability issues, and that the landlord did not violate the privacy statute where the tenants were present when the landlord came, and the landlord claimed an emergency. The court also held that the trial court did not err in not admitted evidence when the pro se tenants did request admission. The court noted that since the tenant appealed from the rent escrow action judgment but not the separate eviction action judgment, it would not consider whether the notice was retaliatory.
(2) Fit for use intended covenant: other conditions and conduct problems
While most cases involve violations of the reasonable repair and code compliance covenants, it is possible to have a violation of only the "fit for intended use" covenant. For instance, if the parties agreed that the landlord would supply a room air conditioner for the apartment but then did not supply it, the lack of the air conditioner may violate the "fit for intended use" covenant without constituting disrepair or a code violation. In Swartwood v. Gardner, No. UD-1950929506 (Minn. Dist. Ct. 4th Dist. Oct. 20, 1995) (Appendix 113), the tenant did not prove that the landlord promised to provide her a stove and refrigerator. Other violations could include conduct issues, such as harassment or unannounced visits by the landlord, or failure of the landlord to control the conduct of other tenants. See Person v. Torchwood Management, No. UD-1920604543 (Minn. Dist. Ct. 4th Dist. July 6, 1992) (Appendix 205) (rent escrow action: landlord's failure to effectively abate loud and abusive language by neighboring tenants, noisy parties, and unjustified harassment by other tenants violated § 504.18 (now § 504B.161)); Colonial Court Apartments, Inc. v. Kern, 292 Minn. 533, 163 N.W.2d. 770 (1968) (damages action: affirmed trial court finding of constructive eviction for landlord's failure to respond to tenant's complaints about neighboring tenants); Gittleman v. Klinkner, No. UD-1970805900 (Minn. Dist. Ct. 4th Dist. Aug. 29, 1997) (TR Appendix 151) (Rent abatement of $300 (18%) for problems with the size of the air conditioner, plumbing, and other repairs where landlord promptly responded to some repair needs but slowly to others; landlord ordered to provide properly-sized air conditioner). But see O'Connor v. Miller, UD-194-0211505 (Minn. Dist. Ct. 4th Dist. Mar. 24, 1994) (Appendix 178) (improper citizen arrest did not support rent abatement).
(3) Housing code violations not concerning housing condition
While most housing code cases deal with the physical condition of housing, the housing code covenant is not limited to repair cases. Issues of the landlord-tenant relationship governed by local housing maintenance, health, and safety laws also should be open for litigation, if the landlord does not maintain the premises in compliance with them. For instance, the Minneapolis Code of Ordinances Housing Maintenance Code (Appendix 138)
(a) requires the landlord to give the tenant a copy of the lease within five days after it is signed by both parties, § 244.280,
(b) requires the landlord to make good faith and reasonable effort to notify the tenant before entering the unit, § 244.285,
(c) prohibits termination of the tenancy because of housing repair litigation by the tenant or City or tenant complaint about housing conditions, § 244.80, and
(d) requires the landlord to take appropriate action to deal with disorderly activity by tenants and/or guests on the premises. § 244.2020 (Appendix 128).
Counsel should seek rent abatement when the landlord does not maintain the premises in compliance with such code requirements.
(4) Disrepair caused by acts of nature or third parties
Section 504B.131 (formerly § 504.05) provides that where the property is "destroyed or is so injured by the elements or any other cause as to be untenantable or unfit for occupancy, [the tenant] is not liable thereafter to pay rent ...." The statute generally served as the basis for constructive eviction. In Ellis v. McDaniel, No. UD-1960318520 (Minn. Dist. Ct. 4th Dist. Apr. 4, 1996) (Appendix 203), the court held that the tenant was not liable for rent where apartment is made uninhabitable due to actions of a third party and through no fault or negligence of the landlord or tenant, under Sections 504.05 (now § 504B.131) and 504.18 (now § 504B.161).
(5) Court inspection of the property
It is not uncommon for courts to take a first hand view of the property. In Scroggins v. Solchaga, 552 N.W.2d 248, 252 (Minn. Ct. App. 1996), the court noted that the district court may inspect the property, as long as it does not gather its own evidence.
In Wardin v. Maski, No. C4-97-2245 (Minn. Ct. App. Aug. 18, 1998) (Appendix 371) (Unpublished), the court noted that on appeal trial court findings on habitability will be upheld unless clearly erroneous. The court affirmed trial court findings of the uninhabitability of a basement bedroom and the number of habitable units as not being clearly erroneous. The trial court also has considerable discretion in evidentiary rulings relating to habitability. In Wardin, the Court affirmed trial court evidentiary rulings as not constituting an abuse of discretion, where the trial court admitted photographs of conditions taken by a prior tenant but supported by the current tenant's testimony that the photographs accurately depicted the condition when the tenant moved into the property.
Landlords and tenants often submit public documents to support their cases, such as landlords submitting police reports in breach cases, and tenants submitting inspection reports in habitability cases. While both documents probably comply with the public records exception to the hearsay rule in Minn. R. Evid. 803(8), they still must be authenticated or be self-authenticating under Rules 901 and 902. State v. Northway, 588 N.W.2d 180 (Minn. Ct. App. 1999) (affirmed trial court exclusion of federal report which was not authenticated).
Hearsay statements within the report should be excluded unless they meet an exception to the hearsay rule. Countryview Mobile Home Park v. Oliveras, No. A04-160, 2004 WL 20049986 (Minn. Ct. App. Sept. 14, 2004) (unpublished) (affirmed from district court ruling sustaining objection to police report containing observations of officers who were not present in court); Minneapolis Public Housing Authority v. _____, No. HC 10306313566 (Minn. Dist Ct. 4th Dist. July 31, 2003) (Appendix 539) (Judge Doty) (landlord’s knowledge of alleged altercation was from a police report whose authors did not testify, and did not connect tenant to the incident).
A housing inspection under city ordinance without tenant consent conducted pursuant to a valid administrative search warrant was not unconstitutional. Cardinal Estates, Inc. v. the City of Morris, No. CX-02-1505, 2003 WL 1875487 (Minn. Ct. App. April 15, 2003) (unpublished).
Federal law requires owners of most pre-1978 rental property to disclose known information about lead based paint and hazzards, with penalties of up to $11,000 per violation and treble damages for willful violations. 24 C.F.R. Part 35, § 30.65; 40 C.F.R. Part 745. See D. Ryan and R. Scott, New environmental Sampling and Right-to Know Strategies for Housing and Tenants’ Rights Advocates, Clearinghouse Review at 447 (Nov.-Dec. 2001).
Tenants and other lay witnesses have the right to testify about their observations of habitability problems. In Stewart v. Anderson, No. A06-1878, 2007 WL 2366528 (Minn. Ct. App. Aug. 21, 2007) (unpublished), the landlord filed a combination eviction action and conciliation court action in housing court, and the tenant answered alleging habitability. At trial, the tenant attempted to testify about her observations about how her dryer worked, and rodent infestation. The housing court referee did not accept her testimony, since she was not an expert in dryer repair or pest control. After the referee ruled for the landlord, the tenant sought review by a district court judge. The district court reversed the referee and awarded rent abatement, finding that the referee erred by requiring expert testimony for lay testimony. On appeal, the Court of Appeals held that the district court correctly found that the referee had erred.
e. Is notice of violations required?
The tenant need not prove notice of violations of the covenants that existed at the beginning of the tenancy. See Bebault v. Danko, No. 742053 at 8 (Minn. Dist. Ct. 4th Dist. 1978) (three judge appellate panel) (landlord "must be held to know the conditions of the premises [the landlord] offers for rent") (Appendix 7). See also R. Schoshinski, supra, § 3:24 at 141 n.20; 51C C.J.S., Landlord and Tenant, § 371 (1968), cited in Bebault at 8.
There is disagreement over whether the landlord must receive notice of violations of the covenants which arise after commencement of the tenancy. Section 504B.161 (formerly § 504.18) does not discuss notice, and there are no Minnesota Appellate cases on point.
Landlords may argue that the lack of notice would be a bar to recovery where the defective condition arose during the tenancy or where the parties' lease contained a term requiring the tenant to give the landlord notice of repair problems. In Mease v. Fox, the Iowa Supreme Court reasoned that "since the basic contract remedies are available to tenant, the basic contract duties are imposed upon them. The tenant is under an obligation to give landlord notice of a deficiency or defect not known to the latter." 200 N.W.2d 791, 797 (1972).
Tenants should argue that the tenant is not required to notify the landlord of defective conditions. The statute contains no notice requirement. In Bebault, the court noted that "[a]rguably, requiring that notice of a breach of warranty be given to the landlord runs contrary to the clearly articulated legislatively purpose to thwart some measure of protection to tenants." No. 742053 at 7. See Meldahl and SJM Prop. v. _____, No. 1050923509, Order on Referee Review at 21-22 (Minn. Dist. Ct. 4th Dist. Feb. 23, 2006) (Appendix 609) (judge reversed referee and ordered that tenant need not give written notice to the landlord of violations of covenants of habitability, regardless of provisions in the written lease); Gerald Snyder Rental Associates v. Bello, No. UD-1950117553 (Minn. Dist. Ct. 4th Dist. Mar. 15, 1995) (Appendix 118) (on Judge review of referee's decision, tenant need not give written notice to the landlord of violations of covenants of habitability, regardless of provisions in the written lease); McNair v. Doub, No. UD-1960708524 (Minn. Dist. Ct. 4th Dist. Aug.12, 1996) (Appendix 205) (lease did not require tenant who gave oral notice of disrepair to give written notice).
In George Washington University v. Weintraub, the District Columbia Court of Appeals held that actual notice need not be given if the landlord, in exercise of reasonable care, would have become aware of the defective condition. 458 A.2d 43, 48-49 (1983). (Appendix 7.C) Until recently, in tort cases based upon a violation of the covenants of habitability, the courts considered whether the landlord knew or should have known of the danger on the property. A landlord who violated the covenants had a duty to warn the tenant of the defective condition of the property if the landlord knew or should have known of the danger, and if the tenant would not discover it by exercising due care. See Oakland v. Stunlund, 420 N.W.2d 248, 252 (Minn. Ct. App. 1988); Broughton v. Maes, 378 N.W.2d 134, 135-37 (Minn. Ct. App. 1985); Hanson v. Rowe, 373 N.W.2d 366, 370 (Minn. Ct. App. 1985); Meyer v. Parkin, 350 N.W.2d 435, 437-39 (Minn. Ct. App. 1984). However, Bills v. Willow Run I Apartments, 534 N.W.2d 286 (Minn. Ct. App. 1995), the court held that a violation of the Uniform Building Code in leased premises is negligence per se when the violation harms tenants and that harm is the type which the building code was intended to prevent.
The requirement for tenant remedies and rent escrow actions that the landlord receives notice of repair problems either from a tenant or a housing inspector do not apply to unlawful detainer actions. Larson v. Bonacci, No. UD-970506542 (Minn. Dist. Ct. 4th Dist. Jun. 18, 1997) (Appendix 265).
The landlord may defend against the alleged violation of the covenants by proving that the housing was fit for the use intended, in reasonable repair, and in compliance with the code, or by showing that any disrepair or code violation was caused by the willful, malicious, or irresponsible conduct of the tenant or tenant's agent. Minn. Stat. § 504B.161 (formerly § 504.18), subd. 1. However, the landlord would be responsible for violations of the covenants that result from acts of nature or third parties who are not guests, agents or family members of the tenant. While a lease provision stating that the landlord is not liable for damage caused to the tenant's property, may be enforceable, such a provision does not limit the landlord's liability under § 504B.161 (formerly § 504.18).
The landlord also may argue that the tenant agreed in writing to perform specified repairs or maintenance, if the agreement is supported by adequate consideration and set forth in a conspicuous writing. However, such an agreement may not waive the covenants or relieve the landlord of the duty to maintain common areas of the premises. § 504B.161 (formerly § 504.18), subdivision 2. See Jafer Enterprises, Inc. v. Peters, No. UD-1920701512 (Minn. Dist. Ct. 4th Dist. Aug. 11, 1992) (Appendix 5.P) (rejection of defense that negotiated rent reduction precluded further rent abatement). In Wardin v. Maski, No. C4-97-2245 (Minn. Ct. App. Aug. 18, 1998) (Appendix 371) (Unpublished), the Court affirmed the trial court's finding that a lease provision requiring the tenants to maintain mechanical systems violated Minn. Stat. § 504.18 (now § 504B.161), where the provision was not specific, was not set forth in a conspicuous writing, and was not supported by consideration. See discussion, supra, VI.E.1.a.
A landlord may argue that the landlord took reasonable steps to deal with the repair problems. While the landlord's reasonable efforts to deal with repair problems would be commendable, they do not change the fact that the repair problems existed in the first place, and that the tenant had to live with them. The landlord's efforts may somewhat mitigate rent abatement, but should not eliminate it. See Uni-B-Partnership v. Mahto, No. UD-1970515516 (Minn. Dist. Ct. 4th Dist. Jul. 1, 1997) (Appendix 301) (Landlord took reasonable steps to eliminate infestation problems: rent abatement of $250 (11%) over three months); Ramdin v. Ali, Nos. UD-1981001900 (Minn. Dist. Ct. 4th Dist. Oct. 27, 1998) (Appendix 360).
While landlords often allege that the tenant caused the disrepair, few decisions have found that the disrepair was caused by willful, malicious or irresponsible conduct of the tenant or tenant's agent. Rogers v. Stewart, No. UD-1961029511 (Minn. Dist. Ct. 4th Dist. Jan. 6, 1997) (Appendix 290) (Tenant, family and guests intentionally or negligently caused damage beyond normal wear and tear of a large family).
To the contrary, courts often find that the tenant's conduct to fall below this high standard. In Genie Management Co. v. Wilson, No. UD-1980707541 (Minn. Dist. Ct. 4th Dist. Jul. 29, 1998) (Appendix 334), the court found that the tenant and her guest inhibited but did not prevent the landlord from making repairs, noting that the tenant requested that the landlord work on the property only when she was present, and that her friend created a hostile environment for the landlord when he made repairs. The court still awarded rent abatement, but ordered that the tenant fully cooperate with the landlord in making repairs, including controlling the behavior of her guest, noting that failure to do so could result in a reduction of rent abatement in future months.
Recent decisions include Judge v. Rio Hot Properties, Inc., No. UD-1981202903 (Minn. Dist. Ct. 4th Dist. July 7, 1999) (Appendix 401) (tenants proved landlord breach of covenants of habitability, while landlord failed to prove tenant negligence or commission in damage, or that tenants unreasonably denied access to the landlord); Lynch v. Hart, No. UD-1960610529 (Minn. Dist. Ct. 4th Dist. Jun. 27, 1996) (Appendix 185);Overstreet v. Jackson, No. UD-1960520509 (Minn. Dist. Ct. 4th Dist. Jun. 17, 1996) (Appendix 206); Ellis v. McDaniel, No. UD-1960318520 (Minn. Dist. Ct. 4th Dist. Apr. 4, 1996) (Appendix 203); Brook v. Boyd, No. C8-96-47 (Minn. Dist. Ct. 9th Dist. Feb. 13, 1996) (Appendix 207). See Hirani v. Neu, No. UD-1960522506 (Minn. Dist. Ct. 4th Dist. Jun. 17, 1996) (Appendix 208) (rent abatement awarded even though tenant contributed to, but did not cause some repair needs). But see Scroggins v. Solchaga, 552 N.W.2d 248, 252 (Minn. Ct. App. 1996) (Court of Appeals held that § 566.25 (now § 504B.425) (the tenant remedies relief section) gave the district court discretion to not award rent abatement, noting that the tenant may have caused some of the properties' problems).
Earlier decisions include Richard v. Mix, No. UD-1950424510 (Minn. Dist. Ct. 4th Dist. May 3, 1995) (Appendix 118) (landlord failed to prove that hazardous plumbing and lack of maintenance were caused by alleged lack of cooperation or negligent or intentional acts by the tenant); Kahn v. Greene, No. UD-1940330506 at 5 (Minn. Dist. Ct. 4th Dist. May 25, 1994) (Appendix 46) (no convincing evidence that violations or damage were result of defendants' conduct or behavior); Buckeye Realty Co. v. Elias, No. CX-91-0697 at 4-5, 9 (Minn. Dist. Ct. 10th Dist. Aug. 6, 1991) (Appendix 15.E) (plaintiff made no showing that damage caused by grease fire in defendant's town home was due to willful, malicious, or irresponsible conduct of defendants); Bebault v. Danko, No. 742053 at 6-7 (Minn. Dist. Ct. 4th Dist. 1978) (Appendix 7); Zeman v. Arnold, No. UD-1900911501 at 2, (Minn. Dist. Ct. 4th Dist. Oct. 11, 1990) (Appendix 6.A); Tyus v. Minneapolis Public Housing Authority, No. UD-1900502523 at 4 (Minn. Dist. Ct. 4th Dist. July 11, 1990) (Appendix 9.A). U and W, Inc. v. Grow, No. UD-19504103505 (Minn. Dist. Ct. 4th Dist. Apr. 25, 1995) (Appendix 111); Hendersen v. Schaapveld, No. UD-1950127501 (Minn. Dist. Ct. 4th Dist. Mar. 10, 1995) (Appendix 119); Apple Square, Inc. v. Muldrow, No. UD-1950213547 (Minn. Dist. Ct. 4th Dist. Mar. 2, 1995) (Appendix 120); Jensen v. Scott, No. UD-1950203531 (Minn. Dist. Ct. 4th Dist. Feb. 28, 1995) (Appendix 114).
(1) Pre-Covenants of Habitability and Fritz
Before enactment of the covenants of habitability and the Fritz Court's interpretation of the covenants, the courts applied a "rental value" approach to measuring damages resulting from violations of express covenants to repair in leases. The measure of damages was the difference between the rental value of the premises in their present condition and their value in the condition required by the covenants. See Geo. Benz & Sons v. Massie, 208 Minn. 118, 126, 293 N.W. 133, 137 (1940); Theopold v. Curtsinger, 170 Minn. 105, 109, 212 N.W. 18, 20 (1927); Warren v. Hodges, 137 Minn. 389, 390, 163 N.W. 739 (1917). There is disagreement over what constitutes market value. Landlords may argue that market value may be the rent agreed upon by the parties. However, this may not be appropriate in cases where the rent charged is, due to the condition of the building, below the market value of comparably sized units in the same community that are in compliance with the covenants. Tenants should argue that the rent agreed to by the parties was the market value of the premises in compliance with the covenants, under ordinary circumstances. See Theopold, 170 Minn. at 109, 212 N.W. at 20. Tenants also argue that the landlord's argument goes against the prohibition on waiver of the covenants and the provision that the covenants be liberally construed. § 504B.161 (formerly § 504.18), subds. 1, 2, 3.
(2) Post-Covenants of Habitability and Fritz
Neither § 504B.161 (formerly § 504.18) nor the Minnesota Appellate Courts have clearly stated what standard should be used to measure damages for violation of the covenants of habitability. Tenants should argue that the "percentage reduction in the use and enjoyment" formula is most appropriate. Under this formula, the rent is abated by a percentage amount equal to the percentage reduction in the use and enjoyment which the trier of fact determines to have been caused by the defects. Because of the cost and impracticability of using expert testimony to establish rental value in a habitability case, this measure appears to be the one most commonly adopted in cases which have actually set damages. R. Schoshinski, American Law Of Landlord And Tenant, § 3:25 at 143 (1980), at 73 (Supp. 1990).
This standard also is consistent with the covenants of habitability. "The parties to a lease or license of residential premises may not waive or modify the covenants. . ." § 504B.161 (formerly § 504.18), subd. 1. In Fritz, the Minnesota Supreme Court stated that "the rent or at least part of it, is not due under the terms of the lease when the landlord has breached the statutory covenants." 298 Minn. at , 213 N.W.2d at 342. The Tenants' Remedies Act incorporates this standard by authorizing the court to "find the extent to which any uncorrected violations impair the tenant's use and enjoyment of the premises contracted for and order the rent abated accordingly." Minn. Stat. § 504B.425 (formerly § 566.25) (emphasis added).
To the contrary, applying the pre-Section 504B.161 (formerly § 504.18) and Fritz standard of measuring damages based on the difference between the rental value of the premises in their present condition and the rental value of the premises in the condition required by the covenants, could lead to a minimal rent abatement or no abatement at all in substandard property rented at a low rent. See R. Schoshinski, supra, § 3:25; Cezares v. Ortiz, 109 Cal. Appendix 3rd Supp. 23, 168 Cal. Rptr. 108, 110-13 (1980); McKenna v. Begin, 362 N.E.2d 548, 552-53 (Mass. Ct. App. 1977).
Minnesota trial courts also have applied the reduced use and enjoyment standard in summary proceedings such as eviction (unlawful detainer) and tenants' remedies actions. In Zeman v. Arnold, No. UD-1900911501 (Minn. Dist. Ct. 4th Dist. Oct. 11, 1990) (Appendix 6.A), the court expressly applied the standard, finding that "[t]he condition of the premises has reduced the tenants use and enjoyment of the property." Id. at 2. In Z & S Management Company v. Jankowicz, No. UD-1920219515 at 9-10 (Minn. Dist. Ct. 4th Dist. Mar. 24, 1992) (Appendix 9.B), the court again expressly applied the "tenants use and enjoyment of the property" standard. See Kahn v. Greene, No. UD-1940330506 at 5 (Minn. Dist. Ct. 4th Dist. May 25, 1994) (Appendix 46); Kahn v. Foote, No. UD-1940414503 at 4 (Minn. Dist. Ct. 4th Dist. May 6, 1994) (Appendix 47). See generally Appendices 110-120.
In Larson v. Cooper, the 4th District Court found that the basement rooms in a house were not habitable. The rooms constituted one-half of the total floor space of the rental unit, and one-fourth of the total rooms. The court ordered an abatement of $175 per month from a total rent of $675 per month, or a 26% abatement. No. UD-1880209557 (March 21, 1988) (Appendix 6). In Hawkins v. McNeillus, the Dodge County Court found violations of the covenants including water damage on ceilings, walls, and outlets; mold and mildew in sleeping areas, lack of operable fire extinguishers and vent fans; and storage of flammable liquids. The court ordered an abatement from 25 to 50% of the net rent received. Nos. 2063 and 2131 at 8-9 (Appendix 7.B).
In _____ v. Gustafson, No. 030220564 (Minn. Dist Ct. 4th Dist. Apr. 14, 2003) (Appendix 440), in a rent escrow action, the court ordered complete rent abatement for numerous housing code violations, partial rent abatement following substantial but not complete compliance by landlord.
It is not uncommon to have rent abatements in the range of 25 to 50 percent. Recent rent abatement
decisions, in declining order of percentage rent abatement, include Zeman v. _____, No. HC 031002500
(Minn. Dist Ct. 4th Dist. Nov. 3, 2003) (Appendix 595) (50% rent abatement, retaliation defenses to not
apply in nonpayment of rent case); Washington v. Okoiye and Okoiye v. Washington, No. UD-1981029901
(Minn. Ct. Dist. June 15, 1999) (Appendix 423) (rent abatement increase to $300 from $650 (46 %));
Washington Rent Abatement Table (Appendix 427); Walters v. Demmings, No. UD-1990916517 (Minn.
Dist. Ct. 4th Dist. Nov. 15, 1999) (Appendix 422) (rent abatement at $200 a month from $480 per month rent
(42%)); Smith v. Brinkman and Brinkman v. Smith, Nos. HC-1000124900 and HC-1000202517 (Minn. Dist.
Ct. 4th Dist. Mar. 9, 2000) (Appendix 418) (rent abatement of $800 over four months (38%)); Wilson v.
Lowe, No. UD-1991123901 (Minn. Dist. Ct. 4th Dist. Jan. 14, 2000) (Appendix 429) (Rent escrow action:
tenant awarded treble what she paid on shared electrical meter covering basement and common areas in
addition to her unit, and rent abatement of $2,600 over eight months (37%)); Leshoure v. O’Brian, No. UD-01000303900 (Minn. Dist. Ct. 4th Dist. May 17, 2000)(Appendix 403) (rent escrow action: monthly rent
abatement of $300 out of $850 (35%) for $3,600 over one year); Coleman v. Kopet, No. UD-1000211534
(Minn. Dist. Ct. 4th Dist. Mar. 8, 2000) (Appendix 385) (rent abatement of $2,925 over ten months (32%)
covered by rent paid into court and credits against future rent).
Even a lower percentage rent abatement can add up over a number of months. _____ v. Brogdon Properties, Inc., No. HC 030904900 (Minn. Dist Ct. 4th Dist. Sep. 17, 2003) (Appendix 435) (rent escrow action: complete rent abatement for lack of licensing, judgment of $2500); Walters v. _____, No. HC 10101004526 (Minn. Dist Ct. 4th Dist. Oct. 26, 2001) (Appendix 593) (landlord responsible for shared meter bills, and liable for treble damages or $500 to be credited against rent; tenant payment on bill deemed payment of rent; tenant entitled to costs and disbursements from successful Court of Appeal case; habitability rent abatement of $150-175 per month; leave to file motion for attorney’s fees; $3818 disbursed from court to tenant); Wood v. O'Brien, No. UD-1970203900 (Minn. Dist. Ct. 4th Dist. Apr. 29, 1997) (Appendix TR 165) (Rent escrow action: $1,250 (25%) rent abatement over nine months for foundation, electrical, plumbing, heating, and basement drainage problems).
The only decisions apparently adopting a market value analyses were decisions in which the trial court concluded that condemned properties had no market value and therefore no rent was due. See Hamre v. Wu, No. 797483 at 7 (Minn. Dist. Ct. 4th Dist. Jan. 26, 1983) (Appendix 8); Zeman v. Smith, Nos. UD-1840605512 and UD-1840605520 at 9 (Henn. Cty. Mun. Ct. July 11, 1984) (Appendix 9). Indeed, in cases where the property has been condemned, the tenant may prefer to assert a market value analysis, since it leads to a result where the property has no market value and therefore no rent is due. An analysis under the percentage reduction in use and enjoyment standard could lead to the result where the condemned property had some use, and therefore some rent was due.
(3) Condemned or condemnable housing
Where the premises have been condemned as uninhabitable or are condemnable, the present value is $0.00 and no rent is due to the landlord. See Hamre v. Wu, No. 797483 at 7 (Minn. Dist. Ct. 4th Dist. Jan. 26, 1983) (three judge appellate panel) (Appendix 8). See also Zeman v. Smith, Nos. UD-1840504512, UD-1840605520 at 5-6 (Henn. Cty. Mun. Ct., July 11, 1984) (Appendix 9) (tenant also owes no rent for period prior to condemnation where premises were in condemnable condition; inspection occurred after rent was due, and inspection orders warning of condemnation were placed on the property during the time period and were not obeyed, leading to condemnation). The tenant is entitled to a 100% abatement of rent paid. Love v. Amsler, No. 87-14719 (Minn. Dist. Ct. 4th Dist. July 14, 1988), aff'd 441 N.W.2d 555 (Minn. Ct. App. 1989) (complete rent abatement for unhabitable apartment); _____ v. Gibson, and _____ v. Gibson, Nos. 1000301900 and 1000301901 (Minn. Dist. Ct. 4th Dist. Mar. 27, June 30, 2000) (Appendix 439) (emergency relief action, 100% rent abatement for condemnation, and additional treble damages, tenant may repair and deduct costs from rent, replacement housing, fines; subsequent order that new owner bound by predecessor landlord’s obligations, $1800 in attorney fees, injunction against retaliation). See Orders (Minn. Dist. Ct. 4th Dist. Mar. 9 and 13, 2000) (Appendix 383); Cloutier v. Gibson, and Jackson v. Gibson, Nos. 1000301900 and 1000301901 (Minn. Dist. Ct. 4th Dist. Mar. 9 and 13, 2000) (Appendix 383) (Emergency relief action: tenant's awarded complete rent abatement plus treble the rent abatement and relocation expenses).
See also Ellis v. McDaniel, No. UD-1960318520 (Minn. Dist. Ct. 4th Dist. Apr. 4, 1996) (Appendix 203) (tenant is not liable for rent where apartment is made uninhabitable due to actions of a third party and through no fault or negligence of the landlord or tenant, under Sections 504.05 (now § 504B.131) and 504.18 (now § 504B.161); complete rent abatement prorated for a period in which tenants could not inhabit the apartment); Erickson v. Foster, No. UD-1871007506 (Minn. Dist. Ct. 4th Dist. Oct. 28, 1987) (Appendix 5.N) (complete rent abatement for dwelling inappropriate for human occupancy); Henderson v. Schaapveld, No. UD-1950127501 (Minn. Dist. Ct. Apr. 10, 1995) (Appendix 119); Richard v. Mix, No. UD-1950424510 (Minn. Dist. Ct. 4th Dist. May 3, 1995) (Appendix 118) (condemned or condemnable); Lewis Properties v. Pruitt, No. UD-1950315516 (Minn. Dist. Ct. 4th Dist. Sept. 22, 1995) (Appendix 92); Swanson v. Ivie, No. UD-1950411541 (Minn. Dist. Ct. 4th Dist. May 8, 1995) (Appendix 116). But see Kahn v. Morrow, No. UD-1940504534 (Minn. Dist. Ct. 4th Dist. May 25, 1994) (Appendix 123) (notice of intent to condemn; monthly rent abatement of $400.00 (76%) of $525.00 rent).
If a landlord, agent, or person acting under the landlord's direction or control rents out residential housing after the premises were condemned or declared unfit for human habitation, the landlord is liable to the tenant for actual damages and an amount equal to three times the amount of all money collected from the tenant, including rent and security deposits, after the date of condemnation or declaration, plus costs and attorney's fees. Minn. Stat. § 504B.204 (formerly § 504.245). The provisions of § 504B.204 (formerly § 504.245) may not be waived.
The prospect of condemnation presents a double-edged sword to the tenant. On one hand, condemnation presents the tenant with evidence that no rent should be due. On the other hand, condemnation also sets a date on which the tenant should vacate the property. If the housing inspector has issued a notice of intent to condemn, the tenant may be able to convince the inspector to not go ahead with actual condemnation until the eviction (unlawful detainer) or rent escrow action is heard, to give the court an opportunity to deal with the situation. If the housing inspector already has condemned the property, the inspector may not have the authority to extend the vacate date. The tenant has two options to seek an extension in this case. First, the tenant could try to go up the chain of command within the inspections department, beginning with the inspector's supervisor and going to the head of the department, or a city council member or the mayor. Second, in some cities, the tenant, like the landlord, may appeal the decision of the inspection's department to a board of appeal. See Minneapolis Code of Ordinances Ch. 242 (Appendix 76).
(4) Trial court discretion to determine rent abatement
The trial court appears to have a great deal of discretion in determining what rent abatement is appropriate under the circumstances. In Scroggins v. Solchaga, 552 N.W.2d 248 (Minn. Ct. App. 1996), the tenant won a jury verdict in an unlawful detainer action finding violation of the covenants of habitability and retaliation. After the landlord gave another notice to quit several months later, the tenant filed a tenants remedies action, in which the court found habitability violations based on the jury verdicts, but denied claims for rent abatement and attorneys fees and released rent paid into court to the landlord. The landlord then filed another unlawful detainer action, in which the tenant defaulted. The Court of Appeals held that § 566.25 (now § 504B.425) (the tenant remedies relief section) gave the district court discretion to not award rent abatement, noting that the tenant may have caused some of the properties' problems. See Love v. Amsler, No. 87-14719 (Minn. Dist. Ct. 4th Dist. July 14, 1988), aff'd 441 N.W.2d 555 (Minn. Ct. App. 1989) (damages action: affirmed complete rent abatement for unhabitable apartment).
In Richter v. Czock, No. C7-01-1340, 2002 WL 338181 (Minn. Ct. App. 2002) (unpublished), the court consolidated an eviction action based on holding over after notice with a rent escrow action. The court affirmed trial court rulings that the lease required a 45 day notice, that $100 per month rent abatement would cover only the period in which the landlord knew of the habitability issues, and that the landlord did not violate the privacy statute where the tenants were present when the landlord came, and the landlord claimed an emergency. The court also held that the trial court did not err in not admitted evidence when the pro se tenants did request admission. The court noted that since the tenant appealed from the rent escrow action judgment but not the separate eviction action judgment, it would not consider whether the notice was retaliatory.
(5) Limitation on retroactivity (back) rent abatement
Unfortunately, it is not uncommon for the court to place an arbitrary limit on how far back in time the tenant can seek rent abatement. Smith v. _____, No. HC 1010417559 (Minn. Dist Ct. 4th Dist. May 21, 2001) (Appendix 571) (failure to renew license with accurate address information suspended right to collect rent; tenant could not recoup rent paid during period before the period of the landlord’s rent claim in which there was no license; landlord liable for statutory penalties for interrupting water service; habitability rent abatement of $100 per month); Larson v. Bonacci, No. UD-970506542 (Minn. Dist. Ct. 4th Dist. Jun. 18, 1997) (Appendix 265) (Rent abatement claim limited to current lease, going back five months); Beliveau v. Olson, No. UD-1970403902 (Minn. Dist. Ct. 4th Dist. Jun. 4, 1997) (Appendix TR 144) (Monthly rent abatement of only $60.00 out of $395 rent for four months on claim of problems over two and one half years).
Some courts have chosen not to limit retroactive rent abatement. _____ v. Brogdon Properties, Inc., No. HC 030904900 (Minn. Dist Ct. 4th Dist. Sep. 17, 2003) (Appendix 435) (rent escrow action: complete rent abatement for lack of licensing, judgment of $2500); Walters v. _____, No. HC 10101004526 (Minn. Dist Ct. 4th Dist. Oct. 26, 2001) (Appendix 593) (landlord responsible for shared meter bills, and liable for treble damages or $500 to be credited against rent; tenant payment on bill deemed payment of rent; tenant entitled to costs and disbursements from successful Court of Appeal case; habitability rent abatement of $150-175 per month; leave to file motion for attorney’s fees; $3818 disbursed from court to tenant); Wilson v. Lowe, No. UD-1991123901 (Minn. Dist. Ct. 4th Dist. Jan. 14, 2000) (Appendix 429) (Rent escrow action: tenant awarded treble what she paid on shared electrical meter covering basement and common areas in addition to her unit, and rent abatement of $2,600 over eight months (37%)); Leshoure v. O’Brian, No. UD-01000303900 (Minn. Dist. Ct. 4th Dist. May 17, 2000)(Appendix 403) (rent escrow action: monthly rent abatement of $300 out of $850 (35%) for $3,600 over one year); Coleman v. Kopet, No. UD-1000211534 (Minn. Dist. Ct. 4th Dist. Mar. 8, 2000) (Appendix 385) (rent abatement of $2,925 over ten months (32%) covered by rent paid into court and credits against future rent.; Clark v. Urban Investments, No. UD-1970821901 (Minn. Dist. Ct. 4th Dist. Sep. 10, 1997) (Appendix 629) (Rent abatement from 1993 through 1997); Larson v. Anderson, No. C9-96-416 (Minn. Dist. Ct. 9th Dist. Oct. 11 and Nov. 8, 1996) (Appendix 264) (Rent abatement of $6,910 over five years failing to repair discharge of raw sewage on the premises; landlord's notice to quit was in retaliation for tenant's complaint to health department). The tenant should argue that the only limitation on the rent abatement claim is the six-year statute of limitations for claims under a contract or statute. Minn. Stat. § 541.05. Any shorter limitation on the claim requires the tenant to litigate similar issues in two separate cases.
(6) Increase rent abatement for noncompliance
Some court have increased rent abatement over time when the landlord fails to comply with court orders. Judge v. Rio Hot Properties, Inc., No. UD-1981202903 (Minn. Dist. Ct. 4th Dist. July 7, 1999) (Appendix 401) (rent abatement to increase if repairs are not completed); Washington v. Okoiye and Okoiye v. Washington, No. UD-1981029901 (Minn. Ct. Dist. June 15, 1999) (Appendix 423) (compliance order in consolidated unlawful detainer and emergency relief actions: rent abatement increase to $300 from $650 (46%) after 1 ½ years of failure to complete repairs; fine of $750 payable to county; $1000 statutory damages and $200 rent abatement for two interruptions of utilities; $1000 for ten privacy violations; landlord ordered to stop privacy violations). See Washington Rent Abatement Table (Appendix 427).
h. Public and Government Subsidized Housing
(1) Federal requirements
In addition to the covenants implied by Minn. Stat. § 504B.161 (formerly § 504.18), public and government subsidized housing programs require landlords to maintain and repair the premises. 24 C.F.R. §§ 966.4 (public housing); 236.1 and 221.530(b) (Section 236 housing); 221.530(b) (Section 221 housing); 880.601(b) (Section 8 new construction); 881.601(b) (Section 8 substantial rehabilitation); 886.119(a)(2) and 866.123 (Section 8 set aside program); 883.702(b) (Section 8 housing through state housing agencies); 886.323 (HUD-owned Section 8 housing); 882.516 (Section 8 moderate rehabilitation program); 882.747 and 882.516(a)-(d) (Section 8 project based certificate program).
Some subsidized housing programs include a federal housing code, called Housing Assistance Standards. A landlord is required to comply with the standards, and the housing authority inspects the housing for compliance with the standards. If the landlord fails to comply with the standards, the housing authority may suspend payment of its subsidy to the landlord. The tenant is not required to reimburse the landlord for the lost subsidy. See 24 C.F.R. Part 982 (Section 8 Existing Housing Certificate and Voucher Program); 882.404 and 882.516 (Section 8 Moderate Rehabilitation Program); and Part 983 (Section 8 Project-Based Certificate Program).
(2) Rent abatement
A tenant in public or government subsidized housing may raise a claim for rent abatement based on violation of the program maintenance requirements or the covenants of habitability. See Meldahl and SJM Prop. v. _____, No. 1050923509, Order on Referee Review at 28 (Minn. Dist. Ct. 4th Dist. Feb. 23, 2006) (Appendix 609) (judge reversed referee and ordered retroactive and prospective rent abatement beyond amounts abated by Section 8 voucher office, to continue until Section 8 voucher office concludes repairs have been completed); Z & S Management Company v. Jankowicz, No. UD-1920219515 (Minn. Dist. Ct. 4th Dist. Mar. 24, 1992) (Appendix 9.B) (rent abatement defense in Section 8 Existing Housing Certificate unlawful detainer action); Tyus v. Minneapolis Public Housing Authority, No. UD-1900502523 (Minn. Dist. Ct. 4th Dist. July 11, 1990) (rent abatement claim in public housing rent escrow action) (Appendix 9.A). See also Housing Authority of East St. Louis v. Melvin, 154 Ill. Appendix 3rd 999, , 507 N.E.2d 1289, 1290-91, 1293-95 (1987) (public housing rent abatement claim in unlawful detainer action); Housing Authority of Newark v. Scott, 137 N.J. Super. 110, , 348 A.2d 195, 197-99 (1975) (public housing); Simon v. Solemon, 385 Mass. 91, , 431 N.E.2d 556, 561-62, 569 n.13 (1982) (rent abatement claim in subsidized housing eviction proceeding).
(3) Measure of damages
In subsidized housing, tenants should argue that the measure of damages also should be calculated by the percentage reduction in use standard. See Housing Authority of East St. Louis v. Melvin, 154 Ill. Appendix 3rd at , 507 N.E.2d at 1293-95; Housing Authority of Newark v. Scott, 137 N.J. Super. at , 348 A.2d at 197-99. See also discussion, supra, VI.E.1.g. In subsidized housing, the rent abatement should be calculated based on the contract rent (tenant's rent plus government subsidy), rather than just the tenant's share of the rent. Simon v. Solemn, 385 Mass. at , 431 N.E.2d at 569 n.13. Tenants should argue that the rent abatement first should go to the tenant, rather than the government, since it is the tenant's use and enjoyment of the premises that has been effected. For instance, if the contract rent was $550.00, with the tenant paying $150.00 and the housing authority paying $400.00, and the court finds that the rent should be reduced by $100.00 for the month of September, the tenant should receive the $100.00 rent abatement, rather than the government.
The tenant may be entitled rent abatement not only for the tenant’s share of the rent, but also the subsidy if the housing authority or HUD does not seek it. Anderson v. Abidoye, 824 A.2d 42 (D.C. App. 2003) (unpublished) (trial court limited rent abatement to tenant’s share of the rent; court of appeals reversed, holding tenant entitled for full rent subject to claims of the subsidy provider).
In Z & S Management Company v. Jankowicz, No. UD-1920219515, (Minn. Dist. Ct. 4th Dist. Mar. 24, 1992) (Appendix 9.B), the plaintiff and defendant participated in the Section 8 Existing Housing Certificate Program. The housing inspector found significant peeling of lead paint on all portions of the exterior of the three floor building, in violation of the federal Housing Quality Standards. After several additional inspections and warnings to the plaintiff, the housing authority withheld the government subsidy for December and January, until the plaintiff corrected the problem at the end of January. Id. at 5-8. The plaintiff then filed an unlawful detainer action, not for the government subsidy withheld by the housing authority, but for the rent withheld by the defendant.
The court found that "peeling lead paint is of special concern when children under the age of 7 reside in the building because young children can eat lead paint chips, resulting in serious illness and even in death." Id. at 9. Noting that the defendant was six months pregnant and had a four year old child, the court found that because of the existence of lead paint in and on the building for five months and plaintiff's failure to remove it promptly, the defendant had suffered loss of use and enjoyment of the premises. Id.
The court awarded a rent abatement of $150.00, but it was not clear if this rent abatement covered the five month period, or a shorter period. Id. at 9-10. It is possible that the rent abatement would have been larger had the peeling lead paint been more accessible to the child, either on the interior walls or on the lower exterior walls during the summer months. The rent abatement award was in addition to, and not set off by the withheld government subsidies.
In public housing, some would argue that the rent abatement should be calculated based on the tenant's rent, since there is no "contract rent" or direct subsidy attributable to individual tenants. Tenants should argue that while rent agreed to by the parties reflects the market value of the premises in compliance with the covenants under ordinary circumstances, see Theopold v. Curtsinger, 170 Minn. 105, 109, 212 N.W. 18, 20 (1927), the public housing tenant's rent does not reflect market value since it is based on a percentage of the tenant's adjusted income, and rent abatements based upon the tenant's subsidized rent would lead to public housing tenants, with the lowest incomes and the lowest rents, obtaining the smallest abatements for disrepair in public housing. Rent abatement instead should be based upon HUD Fair Market Rent (FMR), which prescribes market rents for apartments rented under the Section 8 government subsidized housing programs. HUD generally issues new FMR's each year at the end of September.
Decisions in recent subsidized housing cases include Curtis v. Surrette, 726 N.E.2d 967 (Mass. App. Ct. 2000) (Section 8 landlord was not entitled to recover entire contract rent from tenants after housing authority terminated housing subsidy payments, only the tenant’s share of the rent; landlord's breach of covenant of quiet enjoyment in connection with its efforts to delead tenants' apartment supported award of three month's rent as damages); Overstreet v. Jackson, No. UD-1960520509 (Minn. Dist. Ct. 4th Dist. Jun. 17, 1996) (Appendix 206) (Section 8 certificate; monthly rent abatement of $100.00 out of $150.00 tenant rent); Robinson v. Schaapveld, No. UD-1951006523 (Minn. Dist. Ct. 4th Dist. Dec 15, 1995) (Appendix 209) (retroactive rent abatement of $30.00 out of $43.00 rent in Section 8 housing).
(4) Multiple inspection agencies
Tenants participating in the Section 8 certificate and voucher program often have access to two different inspectors, one through the Section 8 program, and another with the city inspections department. It is not uncommon for one inspector to fail a unit, and another inspector to pass it, since the inspectors from Section 8 and city inspection offices use different criteria. See Genie Management Co. v. Wilson, No. UD-1980707541 (Minn. Dist. Ct. 4th Dist. Jul. 29, 1998) (Appendix 334) (Unit failed Section 8 inspection in May, passed Section 8 inspection following repairs, and failed city inspection in June; monthly rent abatement of $200.00, or 26% of the total rent of $775.00 and 51% of the tenant's share of the rent of $391.00).
(5) Public housing authority claims for rent abatement
The tenant may be entitled rent abatement not only for the tenant’s share of the rent, but also the subsidy if the housing authority or HUD does not seek it. Anderson v. Abidoye, 824 A.2d 42 (D.C. App. 2003) (unpublished) (trial court limited rent abatement to tenant’s share of the rent; court of appeals reversed, holding tenant entitled for full rent subject to claims of the subsidy provider).
In Barry v. Lane, Nos. UD-1980629502 and UD-1980603900 (Minn. Dist. Ct. Sep. 15, 1998) (Appendix 310B), the total rent was $760, with the tenant's share of the rent being $257 and the Section 8 housing subsidy being $503. The court previously ordered a rent abatement of $500 per month, or 66% of the total rent and 195% of the tenant's share of the rent. The public housing authority apparently asserted that it was entitled to rent abatement beyond the tenant's share of the rent, but since it did not move to intervene, the court disbursed funds in escrow to the tenant.
If the defendant proves breach of the covenants, the court should reduce the rent owed by the measure of damages. Some courts have allowed the rent reduction to include a measure of damages over a number of months of noncompliance with the covenants, while others have reduced future rent until compliance is achieved.
A recent appellate decision might at first glance suggest that the courts should not rule on future rent abatement, but it does not discuss rent abatement and is distinguishable on other grounds. In Eagan East Ltd. Partnership v. Powers Investigations, Inc., 554 N.W. 2d 621 (Minn. Ct. App. 1996), the commercial landlord demanded from the commercial tenant a prospective and retroactive rent increase after the square footage used by the tenant was remeasured. When the tenant failed to pay the additional rent, the landlord filed an eviction (unlawful detainer) action. The trial court held that the rent increase clauses in the lease were ambiguous and could not be applied retroactively from the new square footage measurement, but could be applied prospectively. The landlord then announced a new prospective rent increase, and in a subsequent order of the trial court, the court ruled that the landlord was entitled to the rent increase and the tenant was not entitled to attorney’s fees under the lease. On appeal, the Court of Appeals held that the trial court’s jurisdiction was limited to determining present possessory rights of the parties, and that the trial court exceeded its jurisdiction by ruling on the prospective rent increase and attorney’s fee issues.
The decision was appropriate on the issue of the prospective rent increase, because that issue was not ripe when the landlord commenced the action. Tenant advocates should argue that this decision does not affect rent abatement cases because the rent abatement determination determines present possessory rights, and the doctrines of res judicata and collateral estoppel prevent the landlord from claiming increased rent until the repairs are completed.
Recent decisions continue the long trend of awarding retroactive and prospective rent abatement,
sometimes with a compliance hearing scheduled, and with other relief where appropriate. See Larson v.
Anderson, No. C9-96-416 (Minn. Dist. Ct. 9th Dist. Oct. 11 and Nov. 8, 1996) (Appendix 264) (Rent
abatement judgment of $6,910 over five years failing to repair discharge of raw sewage on the premises;
landlord's notice to quit was in retaliation for tenant's complaint to health department); Barger v. Behler,
No. UD-1970116527 (Minn. Dist. Ct. 4th Dist. Jan. 30, 1997) (Appendix 248) (Current and prospective rent
abatement; landlord ordered to fully clean tenant's apartment; court to release rent to landlord only after
verification of cleaning); Cedar Associates LLP v. Curtis, No. UD-1970108508 (Minn. Dist. Ct. 4th Dist.
May 20, 1997) (Appendix 250) (Retroactive and prospective rent abatement, tenant to continue paying
abated rent into court, court will release money to landlord only after verification of completion of repairs).
If the defendant does not prove breach, the defendant still may redeem by paying the rent owed. See discussion, infra at VI.E.20.
j. Companion tenant's remedies and rent escrow actions
Rent escrow actions and eviction (unlawful detainer) actions which involve the same parties must be consolidated and heard on the dates scheduled for the eviction (unlawful detainer) action. Minn. Stat. § 504B.385 (formerly § 566.34). However, if the tenant commences a tenants' remedies or rent escrow action and pays the withheld rent into court before the landlord files an eviction (unlawful detainer) action, the court should dismiss the eviction (unlawful detainer) action because the tenant no longer is withholding the rent. Zeman v. Currington, Nos. UD-1900910517 and UD-1900911502 at 3 (Minn. Dist. Ct. 4th Dist. Oct. 11, 1990) (Appendix 6.B); Gallion v. Brighton II Ltd. Partnership, No. UD-1931109510 (Minn. Dist. Ct. 4th Dist. Dec. 7, 1993) (Appendix 49). See Floyd v. Myers, Nos. UD-1930601511 and UD-1930602512 (Minn. Dist. Ct. 4th Dist. June 28, 1993) (Appendix 6.C) (rent abatement of $285.00 from $425.00; subsequent eviction notice retaliatory and technical lease violation not material). Other options to consider including seeking a temporary restraining order against filing the eviction (unlawful detainer) action, or sealing the eviction (unlawful detainer) records. See Action Not Appropriate for Certain Types of Litigation, supra at II.B; Temporary Restraining Orders, supra at V.D., Consolidating Actions, supra at V.S., Sealing Court Records, supra at V.T.
In Richter v.. Czock, No. C7-01-1340, 2002 WL 338181 (Minn. Ct. App. 2002) (unpublished), the court consolidated an eviction action based on holding over after notice with a rent escrow action. The court affirmed trial court rulings that the lease required a 45 day notice, that $100 per month rent abatement would cover only the period in which the landlord knew of the habitability issues, and that the landlord did not violate the privacy statute where the tenants were present when the landlord came, and the landlord claimed an emergency. The court also held that the trial court did not err in not admitted evidence when the pro se tenants did request admission. The court noted that since the tenant appealed from the rent escrow action judgment but not the separate eviction action judgment, it would not consider whether the notice was retaliatory.
Consolidating actions also may allow the court to grant relief beyond what it would do in the eviction action. In Washington v. Okoiye, Nos. UD-1981029901 and UD-19809090564 (Minn. Dist. Ct. 4th Dist. Nov. 20, 1998) (Appendix 354C), the court consolidated unlawful detainer and emergency tenant remedies actions, and awarded $100 in monthly rent abatement, $100 for rent abatement for water shutoff, $250 as a stayed fine for violating a repair order, $500 in utility termination damages, $353 as a credit for tenant payments on the landlord's water bill, $500 in privacy violations, all of which could be credited against rent, and $500 in attorney's fees, with a later hearing scheduled to review landlord compliance and additional attorney's fees. The court later ordered that the tenant could remedy violations and deduct the cost from rent, rent abatement would increase from $100 to $200 out of monthly rent of $650, or from 15% to 31% if the landlord did not complete repairs, the tenant could credit payments on the landlord's water bill against rent, the landlord must obtain a rental license, the landlord's right to collect rent was suspended until he obtained the license, and prior orders relating to court approval of future filings remained in effect. (Feb. 4, 1999) (Appendix 354G). See Washington v. Okoiye and Okoiye v. Washington, No. UD-1981029901 (Minn. Ct. Dist. Oct. 8, 1999) (Appendix 426) (compliance order in consolidated unlawful detainer and emergency relief actions: landlord violated unlawful exclusion statute by excluding tenant from the basement; landlord violated shared meter statute where tenant's meter covered her first floor apartment and the common basement which the landlord used for an office and for personal use; landlord violated tenant privacy for coming on the property to do repairs without notice, and by interrogating guests of the tenant; tenant proved that landlord did not provide a certificate of rent paid; landlord failed to prove that tenant failed to pay rent in a timely manner; tenant awarded monthly rent abatement of $300 from $650 (46%) ongoing, $500 for exclusion from the basement, $500 for privacy violations, $500 for violation of the shared meter statute, all of which could be credited against rent; landlord ordered to cease violations of tenant's privacy, and immediately provide tenant with a certificate of rent paid.; Washington v. Okoiye and Okoiye v. Washington, No. UD-1981029901 (Minn. Ct. Dist. June 15, 1999) (Appendix 423) (compliance order in consolidated unlawful detainer and emergency relief actions: rent abatement increase to $300 from $650 (46%) after 1 ½ years of failure to complete repairs; fine of $750 payable to county; $1000 statutory damages and $200 rent abatement for two interruptions of utilities; $1000 for ten privacy violations; landlord ordered to stop privacy violations). See Washington Rent Abatement Table (Appendix 427).
In Walters v. Demmings, No. UD-1990916517 (Minn. Dist. Ct. 4th Dist. Nov. 15, 1999) (Appendix 422), the duplex had separate electrical and gas meters for each unit. The electrical meter for the downstairs tenant also covered the basement and hallways, with the court concluding that it was a shared meter. After the furnace became inoperable and the landlord failed to supply adequate temporary heat and the tenant withheld rent, the landlord and tenant filed unlawful detainer and emergency relief actions, which the court consolidated. The court dismissed the landlord's notice to quit claim as premature, as the action was filed before the effective date of the notice. The court awarded rent abatement at $200 a month from $480 per month rent (42%), $500 in shared meter statutory damages, $500 for utility service interruption damages, all of which could be credited against future rent. The tenant moved for reconsideration of the shared meter damages, arguing that her damages exceeded the $500 statutory minimum. The court rejected the argument, concluding that the tenant must prove how much usage occurred outside of her unit. Demmings v. Walters, No. UD-1991006902 (Minn. Dist. Ct. 4th Dist. Mar. 22, 2000) (Appendix 422).
In Judge v. Rio Hot Properties, Inc., Nos. UD-1981202903, UD-1981005518, and UD-1981104522 (Minn. Dist. Ct. 4th Dist. Dec. 18, 1998) (Appendix 362D), in consolidated unlawful detainer and emergency tenant remedies actions, the court concluded that a notice to quit which was not effective but the parties agreed to litigate was retaliatory where the landlord only wished to rent to other tenants, the landlords waived a no pet provision and could not rely on it to show a non-retaliatory purpose, the tenants were entitled to additional rent abatement beyond an ongoing rent abatement for loss of utilities, and the tenants were entitled to $500 in statutory damages for termination of utility services which they could credit against future rent.
In Stillday v. Kittleson, No. UD-01980421523 and 1980430900 (Minn. Dist. Ct. 4th Dist. Jul. 21, 1998) (Appendix 368), the court consolidated unlawful detainer and rent escrow actions, dismissed the unlawful detainer action for failing to serve a copy of the summons and complaint on the Minneapolis Public Housing Authority, and concluded that the landlord violated the tenant's privacy, and awarded $100 to the tenant. See Thomas v. Dobyne, No. U-1980616536 (Minn. Dist. Ct. 4th Dist. Aug. 4, 1998) (Appendix 370C) (Combined unlawful detainer and lock out actions: award of $500 in statutory damages and $3,635 in attorney's fees where landlord changed the locks while tenant was removing her property following service of a writ of restitution); Guevara v. Catchings, No. UD-01961210536 (Minn. Dist. Ct. 4th Dist. Dec. 23, 1996) (Appendix TR 147a) (Unlawful detainer action filed after rent escrow action dismissed with prejudice).
See Smith v. Brinkman and Brinkman v. Smith, Nos. HC-1000124900 and HC-1000202517 (Minn.
Dist. Ct. 4th Dist. Mar. 9, 2000) (Appendix 418) (Consolidated eviction and rent escrow actions: landlord
failed to prove statutory notice to quit, notice to increase rent given November 1 was not effective to increase
rent December 1, presumption of retaliation applied to a rent increase notice with the landlord failing to
prove a non-retaliatory purpose, habitability rent abatement of $800 over four months (38%) tenant awarded
$300 in civil penalties for landlord visits without notice in which he was rude toward the tenant and her
daughter, landlord ordered to make repairs with tenant's authorized to make repairs and submit bills for court
approval, landlord restrained from harassing tenant and household members with landlord allowed to enter
only to make repairs with written 24-hours notice, tenants awarded costs, disbursements and attorney's fees);
Green v. Formanek, and Formanek v. Green, No. 1991001905 and 4991004400 (Minn. Dist. Ct. 4th Dist.
Oct. 27, Nov. 8, 1999) (Judge Bruce Peterson) (Appendix 393) (Consolidated rent escrow and eviction
actions: dismissal of eviction action where landlord's notice was not wholly without retaliatory motive;
tenant awarded retroactive and prospective rent abatement, and costs and disbursements upon application
and affidavit..
Consolation all expands the time for appeal. See discussion, infra, X.A.
k. Landlord's potential tort liability.
Landlord's may have tort liability related to housing repair problems, but the law of torts has not kept pace with modern developments in landlord and tenant law, leaving tenants relatively unprotected in tort for injuries resulting from apartment disrepair. See L. McDonough, Still Crazy after All of These Years: Landlords and Tenants and the Law of Torts, 33 Wm. Mitchell L. Rev. 427 (2006). In Bills v. Willow Run I Apartments, 534 N.W.2d 286 (Minn. Ct. App. 1995), the Court of Appeals held that a violation of the Uniform Building Code in leased premises is negligence per se when the violation harms tenants and that harm is the type which the building code was intended to prevent). But in Bills v. Willow Run I Apartments, 547 N.W.2d 693 (Minn. 1996), the Minnesota Supreme Court, reversing the Court of Appeals, held that an owner is not negligent per se for a violation of the uniform building code, unless the owner knew or should have known of the violation, the owner failed to take reasonable steps to remedy the violation, the injury suffered was the kind the code was intended to prevent, and the violation was the proximate cause of the injury. See Smith v. Hemphill, No. 94-12234 (Minn. Dist. Ct. 4th Dist. Dec. 12, 1994) (Appendix 127) (negligence per se and strict liability applied to violation of ordinance enacted to protect children from harms associated with ingesting lead contaminated paint and soil); Canada v. McCarthy, 567 N.W.2d 496 (Minn. 1997) (When performing lead abatement work at tenant's property, landlord owes duty of care to tenant and guests; damages award affirmed); Peterson-White v. Duluth Housing and Redevelopment Authority, No. CX-96-1915, 1997 WL 88934 (Minn. Ct. App. Mar. 4, 1997) (Appendix 285) (Unpublished: Public housing authority not entitled to statutory or official immunity in tort action for lead poisoning).
In Funchess v. Cecil Newman Corp, 615 N.W.2d 397 (Minn. Ct. App. 2000), reversed 632 N.W.2d 666 (Minn. 2001), the Court of Appeals reversed summary judgment for the landlord in a tort case filed by the mother of a tenant killed by a person who allegedly entered the building through a defective security system, holding that the landlord has a special relationship and duty to maintain security, and assumed a duty to maintain its security system. The Minnesota Supreme Court reversed, holding that the plaintiff did not create a record of statutory liability for appeal, the landlord did not have a special relationship to the tenant, and that the plaintiff did not plead breach of contract as a claim.
In Gradjelick v. Hance, 627 N.W.2d 708 (Minn. Ct. App. 2001), reversed 646 N.W.2d 225 (Minn. 2002), the Minnesota Supreme Court reversed both the trial court and Court of Appeal rulings for the landlord on summary judgment, holding that analyses under negligence per se and ordinary common law negligence are both available in landlord liability cases when uniform building code violations are alleged, citing Bills v. Willow Run I Apartments, 547 N.W.2d 693 (Minn. 1996). See Stauffenecker v. Salmela, No. C4-02-1712, 2003 WL 1962160 (Minn. Ct. App. 2003) (unpublished) (affirmed summary judgment for landlord, holding that covenants of liability under Minn. Stat. § 504B.161 (formerly § 504.18) does not create liability, citing Meyer v. Parkin, 350 N.W.2d 435, 437-39 (Minn. Ct. App. 1984)).
In Okani v. Loven, No. A03-1545, 2004 WL 1049182 (Minn. Ct. App. May 11, 2004) (unpublished), the Court of Appeals reversed the trial court summary judgment for landlord where material facts existed over whether the landlord negligently repaired the property, and whether negligent repair was a superseding or intervening cause of injury, but affirmed the district court ruling that Minn. Stat. § 405B.161 did not create negligence per se liability, citing Meyer v. Parkin, 350 N.W.2d 435, 438 (Minn. Ct. App. 1984).
While the collateral estoppel affect of eviction (unlawful detainer) litigation is limited, tenant attorneys' and advocates should make a record in appropriate cases that the tenant is not litigating nor waiving a potential tort claim. In Judge v. Rio Hot Properties, Inc., Nos. UD-1981202903, UD-1981005518, and UD-1981104522 (Minn. Dist. Ct. 4th Dist. Dec. 18, 1998), (Appendix 362D), the court made no findings or conclusions on tenant's potential tort claims as they did not litigate them in the summary proceeding. See generally discussion supra, at V.N.
Since the covenants of habitability are implied into all oral and written leases, a violation of the covenants of habitability may give rise to consequential damages. The tenant may recover such consequential damages as, at the time of the making of the lease, the parties could reasonably have contemplated would result from a breach. Poppen v. Wadleigh, 235 Minn. 400, 405, 51 N.W.2d 75, 78 (1952) (commercial lease lost profits); Force v. Gottwald, 149 Minn. 268, 272-75, 183 N.W. 356 359 (1921) (lost profits); Romer v. Topel, 414 N.W.2d 787, 788 (Minn. Ct. App. 1987), review denied (transportation and stabling of horses at another location following collapse of a barn). See generally 5C Dunnell Minn. Digest 2d Damages § 3.00(b).
In Les Jones Roofing v. City of Minneapolis, 373 N.W.2d 807 (Minn. Ct. App. 1985), the commercial tenant rented a building and erroneously assumed that the landlord owned adjacent property and that it would be available for him for parking and storage. The tenant later discovered that the city owned the adjacent property. The tenant rented the property from the city for use as a parking lot and for storage of materials. After the tenant had blacktopped the property and constructed a fence around it, the city ordered it to vacate the property. Because of its inability to use the property, the tenant relocated its business. Id. at 808-09. The trial court directed an award for the tenant for the cost of blacktop installed, as a reasonably foreseeable expenditure at the time the parties entered into the lease. The jury awarded the tenant damages for construction of the fence and relocation expenses, but the trial court granted judgment not withstanding the verdict and vacated the award of relocation expenses. On appeal, the court held that the trial court did not err in vacating the award of moving expenses. The court noted that the tenant had operated its business for several months before it rented the adjacent property from the city and did not state that it would move its business if it could not rent the adjacent property from the city. The court concluded that the evidence did not establish that a lease with the city included an understanding that a breach of the lease would lead to relocation. Id. at 809.
It should be noted that the tenant was seeking relocation expenses for its business, operated on property rented from another landlord rather than the city. Had the business been operated on property rented from the city and rented at the same time, there would have been a clearer case for consequential damages for relocation expenses.
A determination of whether to award consequential damages must be made on a case-by-case basis. When a landlord's breach of the lease excludes the tenant from the premises or forces the tenant to vacate the premises, consequential damages may include relocation expenses, temporary shelter expenses, and increased transportation expenses. See O’Leary v. ______, No. 2990913207 (Minn. Dist Ct. 4th Dist. Sep. 27, 1999) (Appendix 553) (offset of tenant payment for improper towing); Leshoure v. O’Brian, No. UD-01000303900 (Minn. Dist. Ct. 4th Dist. May 17, 2000) (Appendix 403) (rent escrow action: monthly rent abatement of $300 out of $850 (35%) for $3,600 over one year; $250 in consequential damages; landlord failed to overcome presumption of retaliatory notice with claims that the rent was late, since landlord accepted late rent in the past, or that Section 8 repair requirements were too expensive, since tenant had continuously asked for repairs); Bordeaux v. Mathers, UD-1950922925 (Minn. Dist. Ct. 4th Dist. Jan. 29, 1996) ( TR Appendix 66) (emergency tenants' remedies and consumer fraud decision finding consequential damages for increased gas bill at old apartment and higher rent at new apartment); Henderson v. Schaapveld, Nos. UD-1950127501, UD-1950127502 at 10-15 (Minn. Dist. Ct. 4th Dist. Apr. 10, 1995) (TR Appendix 49); Overstreet v. Jackson, No. UD-1960520509 (Minn. Dist. Ct. 4th Dist. Jun. 17, 1996) (Appendix 206) (Section 8 certificate; tenant did not prove entitlement to compensation for loss of food due to refrigerator disrepair where tenant refused entry by the landlord to repair the refrigerator for lack of 24 hours notice).
m. No assessment of costs against tenant
Where the tenant litigates and prevails on the issue of habitability violations, the landlord should not be awarded costs. See Lynch v. Hart, No. UD-1960610529 (Minn. Dist. Ct. 4th Dist. Jun. 27, 1996) (Appendix 185) (tenants not assessed costs because they proved covenant of habitability violations).
In Rio Hot Properties, Inc. v. Judge, No. UD-1981102522 (Minn. Ct. Dist. 4th Dist. Nov. 19, 1998)
(Appendix 362C), the landlord was fined $250 to be credited against rent, with the court ordering second
fine of $500 but stayed to allow landlord time to complete repairs. However, the referee later concluded that
the fines must be paid to the county, and may not be awarded to the tenant as a credit against rent. Rio Hot
Properties, Inc. v. Judge, No. UD-1981102522 (Minn. Ct. Dist. 4th Dist. Mar. 29, 1999) (Appendix 362E)
(citing Minn. Stat. §574.34). In Rio Hot Properties, Inc. v. Judge, No. UD-01981005518 (Minn. Dist. Ct.
4th Dist. May 21, 1999) (Judge L. Arthur) (Appendix 400), the judge affirmed the referee's conclusion,
concluding that the fine statute did not create an exception to the general rule under Minn. Stat. § 574.34
that fines are punitive and payable to the state.
Even if fines are not awarded to the tenant, they may have some deterrent effect, as they can escalate in $250 increments. Washington v. Okoiye and Okoiye v. Washington, No. UD-1981029901 (Minn. Ct. Dist. June 15, 1999) (Appendix 423) (compliance order in consolidated unlawful detainer and emergency relief actions: rent abatement increase to $300 from $650 (46%) after 1 ½ years of failure to complete repairs; fine of $750 payable to county; $1000 statutory damages and $200 rent abatement for two interruptions of utilities; $1000 for ten privacy violations; landlord ordered to stop privacy violations). See Washington Rent Abatement Table (Appendix 427). See also Chmielewski v. _____, No. UD 1990324502 (Minn. Dist Ct. 4th Dist. Apr. 14, 1999) (Appendix 484) ($200 per month rent abatement; landlord order to complete repairs; fines if landlord fails to comply).
As an alternative to fines under § 504B.391 (formerly § 566.35), the court the power to award the amounts as damages to tenant as credits against rent under its contempt power. The court may order a party guilty of contempt to pay damages, costs, expenses, and attorney fees to the other party. Minn. Stat. §588.11. Constructive contempt includes disobedience of any lawful judgment, order, or process of court. §588.01, Subd. 3(3). Judge v. Rio Hot Properties, Inc., No. UD-1981202903 (Minn. Dist. Ct. 4th Dist. July 7, 1999) (Appendix 401) (tenants' motion in consolidated cases to add punitive damages denied where court found no independent tort, but tenant granted leave to proceed with claims for contempt where the landlord had failed to complete repairs for almost one year.
As another alternative to fines under § 504B.391 (formerly § 566.35), the court may award punitive damages. Punitive damages are available in civil actions upon clear and convincing evidence that the acts of the party show deliberate disregard for the rights or safety of others. Minn. Stat. §549.20. A party may not seek punitive damages in an initial pleading, but may move to amend the pleading to claim punitive damages. Minn. Stat. §549.191. Judge v. Rio Hot Properties, Inc., No. UD-1981202903 (Minn. Dist. Ct. 4th Dist. July 7, 1999) (Appendix 401) (tenants' motion in consolidated cases to add punitive damages denied where court found no independent tort, but tenant granted leave to proceed with claims for contempt where the landlord had failed to complete repairs for almost one year..
Once the tenant has proven a violation of a covenant of habitability, the court may retain jurisdiction and schedule a compliance hearing to determine whether the rent abatement should continue in future months. The landlord has the burden of proving completion of repairs in order to cancel the rent abatement. Central Manor Apartments v. Beckman, Nos. UD-1980609509, UD-1980513525 (Minn. Dist. Ct. 4th Dist. July 29, 1998) (Appendix 319B) (Landlord proved completion of repair order by a preponderance of the evidence).
Careful monitoring of landlord compliance with repair orders of the court along with the use of compliance hearings can lead to significant abatements over time where landlord’s fail to comply with court orders. Washington v. Okoiye and Okoiye v. Washington, No. UD-1981029901 (Minn. Ct. Dist. June 15, 1999) (Appendix 423) (compliance order in consolidated unlawful detainer and emergency relief actions: rent abatement increase to $300 from $650 (46%) after 1 ½ years of failure to complete repairs; fine of $750 payable to county; $1000 statutory damages and $200 rent abatement for two interruptions of utilities; $1000 for ten privacy violations; landlord ordered to stop privacy violations). See Washington Rent Abatement Table (Appendix 427). In Huffman v. Ellis, No. UD-1991119518 (Minn. Dist. Ct. 4th Dist. Feb. 2, 2000) (Appendix 397), the parties settled an unlawful detainer action for nonpayment of rent with habitability defenses for rent abatement and a deadline to complete repairs. When the landlord did not complete repairs by the deadline, the tenant moved for relief based on breach of the settlement agreement. The court found the breach of the agreement, diminished use of enjoyment of the premises, and awarded rent abatement. After taking testimony on damage to the tenant's car allegedly caused by repair problems not contemplated in the settlement agreement, the court concluded that the damages were excluded from rent abatement and would not be considered res judicata as to future claims.
r. Housing inspection agency records
Sometimes tenants have difficulty obtaining information on housing court violations from a Housing Inspections Department. Data on code violations is governed by several statutes. Under the Minnesota Government Data Practices Act, generally code violations data are public. Minn. Stat. § 13.442. The identities of individuals who register complaints are private. § 13.44. Data collected for pending civil legal actions are protected. § 13.39. Criminal investigative data is confidential. § 13. 82. Persons who request public government data shall be permitted to inspect and copy it at reasonable times and places. § 13.03.
Chapter 504B also regulates disclosure of inspection records. § 504B.195(formerly § 504.245) requires landlords to disclose certain outstanding inspection orders to tenants, applicants and purchasers. A landlord’s violation of the disclosure statute entitles the tenant to remedies under the private Attorney General Enforcement Statute, § 8.31, Subd. 3a, and other equitable relief as determined by the Court. Such relief could include dismissal or rent abatement in an unlawful detainer action.
After a local authority had inspected a residential building, the inspector must give written notice of code violations to the landlord, the tenant, and any housing-related neighborhood organization which requested the inspection. § 504B.185 (formerly § 566.19). Old § 504.23 set out a process for obtaining code violation information from the inspection agency. Section 504.23 was to be replaced by § 504B.191, but the current published edition of Chapter 504B does not contain 504B.191.
While tenants often rely on inspection reports to raise habitability issues, the report may be subject to objection unless it is certified, or used in connection with the testimony of an inspector. See State v. Northway, 588 N.W.2d 180 (Minn. Ct. App. 1999) (copy of federal agency report not admissible without certification by an official custodian of the report that the copy is a correct copy of the agency report).
s. Studies of effects of inadequate housing conditions
Air quality conditions in housing which adversely affect tenant health should violate the covenants of habitability. See Denise Grady, Perseverance is Key to a Good Life with Asthma, N.Y. Times Science (Oct. 19, 1999); Sheryl Gay Stolberg, Poor Fight Baffling Surge in Asthma, N.Y. Times, National (Oct. 18, 1999). Inadequate housing may have a significant impact on the children who live in it. In There's No Place Like Home: How America's Housing Crisis Threatens Our Children, (Boston Medical Center Housing America, www.irc.org/housingamerica ), substandard housing is linked with increased asthma attacks, anemia, house fires, burns from exposed home radiators, and lost IQ points due to lead poisoning.
A new owner may be bound by predecessor landlord’s obligations. _____ v. Gibson, and _____ v. Gibson, Nos. 1000301900 and 1000301901 (Minn. Dist. Ct. 4th Dist. Mar. 27, June 30, 2000) (Appendix 439) (emergency relief action, 100% rent abatement for condemnation, and additional treble damages, tenant may repair and deduct costs from rent, replacement housing, fines; subsequent order that new owner bound by predecessor landlord’s obligations, $1800 in attorney fees, injunction against retaliation). See Orders (Minn. Dist. Ct. 4th Dist. Mar. 9 and 13, 2000) (Appendix 383).
u. Manufactured (mobile) home park lot tenancies
The manufactured (mobile) home park lot statutes also contain covenants of habitability. Minn. Stat. § 327C.10, subd. 1. See Larson v. _____, No. HC 030324502 (Minn. Dist Ct. 4th Dist. Feb. 13, 2004) (Appendix 528) (referee will not reconsider judge’s order on waiver; tenant meets definition of disabled; requiring mobility disabled tenant to park vehicle further away than other tenants is not a reasonable accommodation; while parking tenant’s vehicle near the home violated an ordinance, most other tenants also violated the unenforced ordinance; tenant’s ordinance violations were repeated but not serious; tenant may raise landlord’s violation of the covenants of habitability as a cause of tenant violation of the lease, where park owner’s park design violated a local ordinance and forces tenant to violate the same ordinance); Potvin v. _____, No. C2-03-1604 (Minn. Dist Ct. 9th Dist. Sep. 19, 2003) (Appendix 562) (tenant first rent manufactured home (not in a park) and land under it, then purchased home and rented land, and fell behind on rent but landlord did not deliver title to tenant; court stayed writ for one week after landlord delivers title to tenant); Sargent v. Bethel Properties, Inc., 653 N.W.2d 800 (Minn. Ct. App. 2002) (addition of utility charges to an existing manufactured-home park rental agreement is a new rule that substantially modifies the agreement and renders the agreement unenforceable). Larson v. Anderson, No. C9-96-416 (Minn. Dist. Ct. 9th Dist. Oct. 11 and Nov. 8, 1996) (Appendix 264) (Rent abatement of $6,910 over five years failing to repair discharge of raw sewage on the premises; landlord's notice to quit was in retaliation for tenant's complaint to health department). See also discussion, infra, at VI.E.11.
2. Other housing condition defenses
a. Violation of housing code precluding action for rent
While the covenants of habitability include compliance with housing codes, see discussion, supra at VI.E.1., violation of the housing code may be a separate and additional defense.
Generally a contract entered into in violation of a statute or ordinance which imposes a prohibition and a penalty for an action is void and unenforceable. However, the court first must consider the nature and circumstances of the contract in light of the statute or ordinance. The court will not infer that the legislative body intended the contract to be void unless such is necessary to accomplish its purpose. The courts have voided contracts where the violations offended important public policies with respect to health and safety of the public, and have upheld contracts where the legislative intent did not indicate that its sanction should apply where the violation is slight, not seriously injurious to the public order, and where no wrong has resulted from want of compliance. New Bonn Company v. Herman, 271 Minn. 105, 135 N.W.2d 222 (1965).
Violation of ordinances, including housing codes, may be punishable as a misdemeanor. See Minneapolis Code of Ordinances, § 1.30. In Leuthold v. Stickney, 116 Minn. 299, 133 N.W. 856 (1911), the landlord brought an action for rent and the tenant defended by alleging that the landlord did not provide a fire escape before commencing the tenancy or at any time during the tenancy, in violation of a state statute and punishable as a misdemeanor. In affirming judgment for the tenant, the court held that the violation rendered the lease void and without consideration, precluding the landlord's action for rent. Id. at 302-03, 133 N.W. at . Accord Millier v. Pouliot, 199 Minn. 331, 333, 271 N.W. 818, , (1937) (violation of Minneapolis building code may be a defense to an action for rent).
In Niskanen v. Fielder, C9-96-600751 (Minn. Dist. Ct. 6th Dist. May 23, 1996) (Appendix 212), the court held that the landlord had entered into an illegal contract by renting unlicensed property in Duluth and could not profit from her wrongdoing.
b. Agency housing repair orders
Some cities have an administrative proceeding within the code enforcement agencies, in which a hearing officer or board may grant rent abatements or allow tenants to make repairs and deduct the expense from the rent. In Minneapolis, if the Health, Housing Inspections, or Fire Departments find an emergency to exist regarding enforcement of the housing maintenance code which requires immediate action to protect health, safety or welfare of the occupants, the Department may issue an emergency order. Minneapolis Code of Ordinances § 244.160. If the Department issues an emergency repair order, it also shall notify the Minneapolis Emergency Violations Hearing Board, which shall hold a hearing as soon as the deadline date for completing the repairs has passed. Among other remedies, the Board may allow the occupants to make the repairs and deduct the expense from the occupants rent. Id. § 244.180.
(1) Beaumia v. Eisenbraun
Many cities in Minnesota have ordinances which require residential landlords to obtain a license before renting their properties. In Beaumia v. Eisenbraun, No. A06-1482, 2007 WL 2472298 (Minn. Ct. App. Sept. 4, 2007) (unpublished), the Court of Appeals held that failure to pay rent could not be a ground for eviction where the landlord failed to comply with a municipal requirement to license or register the rental unit. The Alexandria City Ordinance made it unlawful to lease any residential property unless it had been registered with the City as a rental unit, and a registration fee had been paid. Id., citing Alexandria Code of Ord, Sect. 5.08, Subds. 3(1)5. A landlord filed an eviction action when the tenants told the landlord they did not have the money to pay rent. The District Court ruled for the landlord, concluding that failure to register the rental unit was irrelevant to whether the landlord had the right to recover possession of the property.
The Court of Appeals reversed, first noting that if a tenant’s duty to pay rent is excused, the eviction action must fail. Id., citing MAC-DUE Properties v. LaBresh, 392 N.W.2d, 315, 316-17 (Minn. Ct. App. 1986), review denied (Minn. Oct. 29, 1986), landlord’s failure to acquire city-required certificate of occupancy eliminated tenant’s duty to pay rent, rendering eviction improper. The Court held that the tenants had no rental obligation during the period in which the property was unregistered, and that the tenants could credit rent paid during this period against rent which was unpaid after the landlord registered the property. The Court concluded that because the credit for rent paid but not due was larger than the rent due for the period in which the landlord had registered the property, the District Court erred by evicting the tenants. Id.
Revocation of a rental dwelling license is proper, where the owner received sufficient notice and was given the opportunity to be heard, and the record demonstrates that revocation was based on the issues of which the owner had notice. Zorbalas v. City of Minneapolis, No. A05-2141, 2006 WI 3490455 (Minn. Ct. App. Dec. 5, 2006).
(2) Minneapolis
In 1990 the Minneapolis City Council passed a new set of ordinances regulating rental dwelling licenses. Minneapolis Code of Ordinances Art. XVI, §§ 244.1800-244.2010. The effective date of the ordinances was January 1, 1991. (Appendix 11.A).
Owners of rental dwellings and dwelling units, including rented single family dwellings and rented dwelling units in owner-occupied dwellings, must obtain a license or a provisional license to rent the property. Excluded from this requirement are licensed hotels, licensed lodging houses, convents, monasteries, licensed nursing homes, licensed board and care homes, parsonages, parish homes, manses and rectories, hospitals, and dwellings in cooperative or condominium buildings. §§ 244.1810, 244.1820. By April 1, 1991 (90 days after the effective date of the ordinance), owners of rental dwellings had to apply for a license. § 244.1840. Licenses must be renewed on an annual basis. § 244.1860. Licenses are not transferrable. § 244.1870.
A license may be denied, revoked, suspended, or not renewed for any of the following reasons: (a) nonpayment of the license fee, (b) dwelling units exceeding the maximum number of dwelling units permitted by the zoning code, (c) dwelling or rental dwelling units over occupied or illegally occupied in violation of the zoning code or housing maintenance code, (d) a rental dwelling used or converted to rooming units in violation of the zoning code, (e) a rental dwelling under condemnation as hazardous or unfit for human habitation under this code or state statute, (f) the owner has allowed weeds, vegetation, junk, debris, or rubbish to accumulate repeatedly on the exterior of the premises so as to create a nuisance condition under the code, or (g) the rental dwelling or any rental dwelling unit is in substandard condition. §§ 244.1900, 244.1920. The director of inspections shall mail a notice of noncompliance to the owner or owner's agent, and post a notice to the tenants in the building. The owner shall have from ten to 60 days to correct the defects, depending upon the nature of the defect. § 244.1930. The maximum period was reduced from 90 days to 60 days by ordinance, effective July 6, 1995. Minneapolis Ordinance 95-OR-097 (July 6, 1995) (Appendix 128).
After the period has expired, if the dwelling is still in noncompliance, the director shall mail the owner a notice of denial, non-renewal, revocation or suspension of the license or provisional license. The city council will affirm the director's recommendation unless the owner appeals to the Rental Dwelling License Board of Appeals. § 244.1940-244.1970. When an application is denied or a license or provisional license is revoked, suspended, or not renewed, the director shall order the dwelling or dwelling units vacated within a reasonable time. § 244.1970. A person who allows any dwelling unit to be occupied or rents a dwelling unit to another person without a license is guilty of a misdemeanor. § 244.1980.
The remedies in these ordinances are not exclusive, and are in addition to other remedies available to the city or tenants provided under state law or the code. § 244.1990. On July 6, 1995, the ordinance was amended to reduce the maximum compliance time from 90 to 60 days, allowing entry for rental licensing inspectors to review notices with tenants, and requiring landlords to work with the Community Services Bureau when the conduct of their tenants or guests is considered disorderly. Minneapolis Ordinance 95-OR-097 (July 6, 1995) (Appendix 128).
Licensing status of properties by address is available at
http://apps.ci.minneapolis.mn.us/AddressApp/SearchByAddress.aspx?AppID=PIApp.
Court have moved beyond suspending the landlord’ right to collect rent, to dismissing the action. Hamid v. _____, 27-CV-HC-08-5349 (Minn. Dist. Ct. 4th Dist. July 8, 2008) (Appendix 604) (nonpayment of rent eviction action dismissed and expunged where landlord has no rental license); Taylor v. _____, No. HC 031202508 (Minn. Dist Ct. 4th Dist. Dec. 26, 2003) (Appendix 582a) (dismissal for lack of rental license); Ukatu v. _____, No. HC 0307614501 (Minn. Dist Ct. 4th Dist. July 30, 2003) (Appendix 586) (dismissal for no license at time of filing, even though landlord later obtained license; eviction case is moot when tenants have vacated; expungement granted); Parks v. _____, No. HC 030409567 (Minn. Dist Ct. 4th Dist. Apr. 22, 2003) (Appendix 557) (dismissal for lack of rental license); Albrecht v. _____, No. HC 011129507 (Minn. Dist Ct. 4th Dist. Dec. 13, 2001) (Appendix 461) (dismissal of nonpayment of rent case; landlord without a license shall not rent the premises, and rent collection is suspended until compliance); Tri Star Developers, LLC v. ______, No. HC 1011002522 (Minn. Dist Ct. 4th Dist. Oct. 16, 2001) (Appendix 585) (“renting without a rental license requires dismissal;” securing license after filing the action does not purge the defect in filing without one; expungement granted); Connelly v. Schiff, No. HC-1000417515 (Minn. Dist. Ct. 4th Dist. May 23, 2000) (Appendix 386) (dismissal without prejudice where landlord failed to secure rental license; tenant awarded $200 costs under § 549.02 and $40 in disbursements under § 549.04 for witness fees; expungement granted; plaintiff’s motion to vacate and reopen treated as untimely motion for judge review under Minn. R. Gen. Prac. 611 when filed 11 days after oral announcement of decision).
The landlord’s failure to license the property supports a complete rent abatement. _____ v. Brogdon
Properties, Inc., No. HC 030904900 (Minn. Dist Ct. 4th Dist. Sep. 17, 2003) (Appendix 435) (rent escrow
action: complete rent abatement for lack of licensing, judgment of $2500); Matsumoto v. _____, No. AC
02-2123 (Minn. Dist Ct. 4th Dist. Apr. 19, 2002) (Appendix 534) (Judge Alton) (after license was revoked,
landlord’s rental was unlawful and was not entitled to collect rent; rent abatement of $2695; landlord
violated shared meter statute, tenant entitled to reimbursement for payments made; landlord not entitled to
late fees when he did not have a rental license; landlord proved some cleaning expenses deducted from the
security deposit, but not other damages and penalties; tenant entitled to deposit penalties where part of
landlord’s withholding was in bad faith); Smith v. _____, No. HC 1010417559 (Minn. Dist Ct. 4th Dist. May
21, 2001) (Appendix 571) (failure to renew license with accurate address information suspended right to
collect rent; tenant could not recoup rent paid during period before the period of the landlord’s rent claim
in which there was no license; landlord liable for statutory penalties for interrupting water service;
habitability rent abatement of $100 per month); Cregg v. _____, No. HC 1001006502 (Minn. Dist Ct. 4th
Dist. Oct. 23, 2000) (Appendix 488) (“landlord is prohibited from collecting rent if license is not obtained,
... the rental value of the premises is zero unless a landlord first obtains a rental license;” action dismissed
with prejudice; costs and disbursements awarded); Haney v. _____, No. HC 10001002527 (Minn. Dist Ct.
4th Dist. Oct. 17, 2000) (Appendix 510) (landlord had no right to collect rent without a license; tenant may
recoup rent paid in June and July when there was no license against rent not paid in September and October
when there was a license).
The temporary taking or suspension of a rental license does not result in a taking of the owner’s property, under the United States and Minnesota Constitutions, as the ordinance was properly designed as a means for, and likely to succeed in, preventing harm to the community. Zeman v. City of Minneapolis, 552 N.W. 2d 548 (Minn. 1996).
In 1997, Minneapolis amended its housing code to increase the amount of information that the landlord must supply to the inspections department, and created minimum inspection standards for different types of properties. Housing Maintenance Code Amendments (Appendix 243). See City of Minneapolis v. Swanson, No. C5-97-312, 1997 WL 471182 (Minn. Ct. App. Aug. 19, 1997) (Appendix 251) (Unpublished: Ordinance requiring landlord to list residential address rather than post office box on rental license is constitutional).
Revocation of a rental dwelling license is proper, where the owner received sufficient notice and was given the opportunity to be heard, and the record demonstrates that revocation was based on the issues of which the owner had notice. Zorbalas v. City of Minneapolis, No. A05-2141, 2006 WI 3490455 (Minn. Ct. App. Dec. 5, 2006).
(3) Other cities
(a) Brooklyn Park
Leasing property in Brooklyn Center without a rental license is a misdemeanor under Section 12-901 of the Brooklyn Center Code of Ordinances, in association with Section 12-1302. http://www.cityofbrooklyncenter.org/index.asp?Type=B_BASIC&SEC=%7B463B184D-73EB-4409-ABD8-039D060CA9F1%7D.
In Peterson v. Pearson, UD-2951204800 (Minn. Dist. Ct. 4th Dist. Feb. 12, 1996) (Appendix 211), the court ordered rent abatement until the landlord registered property under Brooklyn Park licensing ordinance. See Wersal v. Guggisberg, No. UD-2970513211 (Minn. Dist. Ct. 4th Dist. May 23, 1997), withdrawn by stipulation (May 29, 1997) (Appendix 303). (Action dismissed for failure to obtain a license under Brooklyn Park Ordinance § 455.10).
(b) Duluth
In Niskanen v. Fielder, C9-96-600751 (Minn. Dist. Ct. 6th Dist. May 23, 1996) (Appendix 212), the court held that the landlord had entered into an illegal contract by renting unlicenced property in Duluth and could not profit from her wrongdoing. In City of Mankato v. Mahoney, 542 N.W.2d 689 (Minn. Ct. App. 1996): the Court of Appeals reversed the city council's revocation of a landlord's rental license, holding that the revocation was arbitrary and capricious because evidence did not support a finding that three noise disturbances occurred during one year within the meaning of the city code.
(c) Alexandria
In Beaumia v. Eisenbraun, No. A06-1482, 2007 WL 2472298 (Minn. Ct. App. Sept. 4, 2007) (unpublished), the Court of Appeals held that failure to pay rent could not be a ground for eviction where the landlord failed to comply with a municipal requirement to license or register the rental unit. See discussion, supra, VI.E.2.c.(1).
(d) New Hope
In McGarrity v. _____, No. 27-CV-HC-08-5946 (Minn. Dist. Ct. 4th Dist. Aug. 5, 2008) (Appendix 608), the court ruled that the landlord who failed to obtain license from City of New Hope could not claim rent due, except for pro rated amount after landlord obtained license.
3. Breach of an express covenant which creates a condition precedent to payment of rent
In Mac-Du Properties v. LaBresh, 392 N.W.2d 315 (Minn. Ct. App. 1986), a commercial lease provided that rent shall begin thirty days after the city granted an occupancy permit to the tenant and the landlord completed improvements; and that the lease was written and accepted by the parties subject to the city approving the occupancy by the tenant. The landlord did not complete the improvements, the city did not issue the permit, the tenant did not pay the rent, and the landlord filed an unlawful detainer action for nonpayment of rent. Id. at 316-17. On appeal the court held that the lease created a condition precedent to the tenant's obligation to pay rent and that the tenant did not owe rent. Id. at 317-18.
4. Tenant payment of utility or essential services following landlord's nonpayment Moved to VI.E.18.d.
In a tenancy, it is the tenant who has been given possession which is exclusive even against the landlord, with the only exceptions being the landlord’s right to enter the premises to demand rent or make repairs, or exceptions provided by the lease. Seabloom v. Krier, 219 Minn. 362, ____, 18 N.W. 2d 88, 91 (1945). Wrongful eviction is prohibited by common law and by statute. Berg v. Wiley, 264 N.W.2d 145, 149 (1978); Minn. Stat. § 506.01. A tenant who has been wrongfully evicted may petition to recover possession of the premises and sue for treble damages or $500.00 in statutory damages, and reasonable attorney's fees. Minn. Stat. §§ 504B.375 (formerly § 566.175), 504B.231 (formerly § 504.255), 557.08, 557.09; Lindner v. Foy, No. A04-2060, 2005 WL 1514461 (Minn. Ct. App. June 28, 2005) (unpublished) (affirmed ruling that landlord locked out tenant where tenant vacated property, paid rent for the month, but was denied access to retrieve property; landlord’s appeal of rental payment award rejected where trial court declined to award moving costs, trouble damages and attorney’s fees, and punitive damages). A tenant who regains possession of the premises following a wrongful eviction may seek a rent abatement in defense of an unlawful detainer action for nonpayment of rent. Yauch v. Caine, No. UD-1900403548 at 3 (Minn. Dist. Ct. 4th Dist. Apr. 20, 1990) (Appendix 11.D).
There is disagreement over the amount of rent already paid that the tenant can recover following unlawful eviction. The tenant's obligation to pay rent is dependent upon the landlord's delivery of possession to the tenant. Fritz v. Warthen, 298 Minn. 54, , 213 N.W.2d 339, 341 (1973); Cohen v. Conrad, 110 Minn. 207, , 124 N.W. 992, (1910). Some argue that the tenant may recover rent paid to the landlord for the period in which the tenant was unlawfully evicted from the premises on a pro rata basis. See Klyberg v. Elkboy, No. UD-1910617511 (Minn. Dist. Ct. 4th Dist. July 3, 1991) (Appendix 5.M) (pro rata rent abatement for three days when defendants were denied use of the premises). Others argue that the tenant can recover the full amount of rent paid for the month in which the tenant was wrongfully evicted. See Harwood v. Meloney, 139 Minn. 212, 214, 166 N.W. 125, (1918) (well-established rule that where landlord wrongfully evicts tenant, the whole rent is suspended until possession has been restored to the tenant); Chapman v. Fabian, 104 Minn. 176, 177, 116 N.W. 207, (1908) (landlord cannot recover rent for month in which tenant was wrongfully evicted; no holding on whether tenant could recover rent if rent already had been paid).
In Yauch, the tenant had not paid March rent. On March 15, he was locked out of the apartment. The tenant petitioned for recovery of the premises, which the court ordered on March 16. The landlord later brought an unlawful detainer action for nonpayment of March and April rent in the amount of $406.00 ($203.00 per month). The court granted a rent abatement of $175.00 (86 percent of the March rent). The court noted that:
Under the somewhat unique circumstances of this case, the Court is disinclined to abate rent in the amount of $500.00 as argued by the defendant particularly in light of Plaintiff's legitimate concerns for the well-being of other residents and the security of their property. It is further noted that this Court immediately issued an Order granting the defendant herein relief from the lockout upon his petition for same.
No. UD-1900403548 at 3 (Appendix 11.D). It may be that in other circumstances, the tenant may be able to obtain a rent abatement in the amount of $500.00 statutory damages. See LeDoux v. Zanosko, No. CX-95-1001 (Minn. Dist. Ct. 9th Dist. Oct. 16, 1995) (Appendix 124) (rent abatement, relocation damages, statutory damages, and attorney's fees following unlawful termination of utilities).
Counsel should attempt to resolve the issue of rent abatement at the hearing on the tenant's petition of restoration to the premises, under Minn. Stat. §§ 504B.375 (formerly § 566.175), 504B.381 (formerly § 566.205), 504B.225 (formerly § 504.25), and 504B.231 (formerly § 504.255). In Brackins v. Simon, No. UD-1940803531 (Minn. Dist. Ct. 4th Dist. Aug. 5, 1994) (Appendix 77), the tenant petitioned to be restored to the premises following the landlord's attempt to exclude her. The court ordered a $500 penalty and $50 in attorneys fees against the landlord under Section 504.255 (now § 504B.231), which would be paid by rent abatement for the month of August. See Smith v. _____, No. 27-CV-HC-06-921 (Minn. Dist. Ct. 4th Dist. July 18, 2006) (Appendix 620) (referee ordered landlord did not need a rental license and terminated lease; judge reversed, concluding landlord without license did not have standing to file eviction, landlord constructively evicted tenant by obtaining restraining order against tenant in bad faith entitling tenant to $500 in damages and $500 in attorney fees, and ordering expungement); ____ v. _____, No. C-3-94-211 (Minn. Dist. Ct. 5th Dist. Dec. 21, 1994) (Appendix 95) (stipulated application of $500.00 statutory penalty to prospective rent abatement, and extension of retaliation protection).
Exclusion of the tenant from part of the property may be unlawful. Washington v. Okoiye and Okoiye v. Washington, No. UD-1981029901 (Minn. Ct. Dist. Oct. 8, 1999) (Appendix 426) (compliance order in consolidated unlawful detainer and emergency relief actions: landlord violated unlawful exclusion statute by excluding tenant from the basement;$500 for exclusion from the basement).
A commercial lease may require a commercial tenant to waive damages for a lockout. Duling Optical Corp. v. First Union Management, Inc., No. C5-95-2718 (Minn. Ct. App. Aug. 13, 1996), Finance & Commerce at 66 (Aug. 16, 1996) (Appendix 181) (unpublished decision). However, residential tenants are protected from waiver by statute. Minn. Stat. §§ 504B.225 (formerly § 504.25), 504B.231 (formerly § 504.255), 504B.001 (formerly § 566.18).
A lockouts also constitutes a misdemeanor under Minn. Stat. § 609.606.
See discussion, infra, VI.E.18 (utilities).
6. Taxes on the land paid by the tenant
Minn. Stat. § 272.45 provides in part as follows:
When any tax on land is paid by or collected from any occupant or tenant, or any other person, which, by agreement or otherwise, ought to have been paid by the owner, lesser, or other party in interest, such occupant, tenant, or other person may recover by action the amount which such owner, lesser, or party in interest ought to have paid with interest thereon at the rate of 12 percent per annum, or may retain the same from any rent due or accruing from the person to such owner or lesser for land on which such tax is so paid.
In Space Center, Inc. v. 451 Corp., 298 N.W.2d 443 (Minn. 1980), the lease provided that the tenant shall pay to the landlord as additional rent all taxes and assessments due and payable, that the landlord shall submit to the tenant statements for such taxes, and that the tenant shall pay the landlord said taxes at least ten days before the same became due. The court concluded that:
In a true landlord-tenant relationship the additional-rents clause might not constitute an agreement by the landlord to pay the taxes. However, under the facts of this case, where the parties were also in a long-term relationship as optionor-optionee followed by vendor-purchaser, and where defendants had agreed to convey marketable title, we hold that defendants were obligated to pay the real estate taxes; their failure to do so entitled plaintiff to pay them and withhold rents for that purpose. Id. at 452.
7. Improper notice to increase rent or fees
If the lease does not provide for increasing the rent, the landlord may not increase the rent until the lease expires, unless the tenant agrees to an increase. If the lease provides for increasing the rent with notice, the landlord must comply with the notice provision. Some provisions for rent increases may be unconscionable. See discussion, infra at VI.G.13-14.
In a month-to-month lease, the landlord should give notice of the rent increase at least one month before the rent increase, since rent often is the most significant element of the lease, increasing the rent is equivalent to terminating the present lease and entering into a new lease with a higher rent, and termination of a month-to-month lease requires written notice before the last month of the tenancy. Grider v. Hardin, No. UD-1980501520 (Minn. Dist. Ct. 4th Dist. May 19, 1998) (Appendix 335) (no change in rent or late fees where landlord failed to give written notice); Minneapolis Public Housing Authority v. Papasodora, No. UD-1960611515 (Minn. Dist. Ct. 4th Dist. Jul. 17, 1996) (Appendix 213) (public housing notice to increase rent is equivalent to notice to terminate month to month lease and initiate new lease with new rent under Minn. Stat. Section 504.06 (now § 504B.135); notice mailed February 29 could not be received in February and was untimely for an April 1 rent increase; void notice could not be a basis for a future rent increase); Donovic v. Dodson, No. C2-96-600607 (Minn. Dist. Ct. 6th Dist. Apr. 29, 1996) (Appendix 201) (month to month tenant entitled to one month grace period to accept or reject term to pay one half of utilities). See discussion, infra at VI.F.1.
It is unclear whether the landlord has the right to unilaterally modify the terms of a periodic tenancy by giving the same kind of notice as is required to terminate the tenancy. Landlords argue that it is a common practice for landlords to give notice of changes in the rent or building rules, and for these changes to be accepted as part of the lease without the need for specifically terminating the existing tenancy or informing the tenant that the tenant must move if the tenant does not accept the new terms. Alternatively, landlords argue that such a notice is actually a notice to terminate the old periodic tenancy combined with an offer to re-rent the premises on new terms.
Tenants should argue that if the tenant objects to the rent increase, the tenant cannot be bound to a new lease by implication. See Fundamentals Of Landlord/Tenant Law And Practice, supra, § 4.1-02(3) at 3-4. However, a notice that explicitly terminates an existing tenancy, offers to renew the lease at an increased rent, and specifies that the offer may be accepted by remaining in possession past the expiration of the original term should be effective.
In a manufactured (mobile) home park lot lease, the landlord must give sixty (60) days written notice of the rent increase, and may increase the rent only twice in any twelve (12) month period. Minn. Stat. § 327C.06. The rent also may not be increased to pay any court or government imposed civil or criminal penalty. Minn. Stat. § 327C.11. Only reasonable rent increases may be enforced against existing tenants. Minn. Stat. § 327C.02, subd. 2.
8. Waiver of notice to increase rent
In First National Realty v. Gumm, No. UD-1910508527 (Minn. Dist. Ct. 4th Dist. May 31, 1991) (Appendix 11.F), the landlord increased the rent effective November 1, but continued to accept rent at the old amount from November through April. The court concluded that the landlord waived the right to evict the tenant for failure to pay the difference between the old rent and the new rent by continuing to accept the old amount of rent without demanding the new amount.
9. Retaliatory rent increase or services decrease
Under Minn. Stat. § 504B.285 (formerly § 566.03), subd. 3, the defendant must tender to the court or the plaintiff the amount of rent due before the increase, and prove by a preponderance of the evidence that (1) the defendant, in good faith attempted to secure or enforce the defendant's rights under the lease or federal, state, or local laws, or reported the plaintiff's violation of any health, safety, housing, or building code or ordinance to a governmental authority, and (2) the plaintiff increased the rent or decreased service as a penalty in whole or in part for the defendant's protected activity.
Proving retaliation under § 504B.285 (formerly § 566.03), subd. 3 may be difficult in most cases. However, if the defendant is the only tenant who has made complaints and the only tenant whose rent was increased, a case could be made for retaliation.
Proving retaliation under Minn. Stat. § 504B.441 (formerly § 566.28) is considerably easier. While § 504B.285 (formerly § 566.03), subd 3 does not create a presumption of retaliation in certain cases, § 504B.441 (formerly § 566.28) does include a presumption of retaliation if the landlord tries to evict the tenant, increase the tenant's obligations or decrease services to the tenant within 90 days after the tenant files a complaint about a violation of a code, a violation of the covenants of habitability, or a violation of the lease. While it is conceivable that a tenant could raise a retaliation defense under § 504B.441 (formerly § 566.28) in a nonpayment of rent case that did not involve an increase in rent or decrease in services, it appears that the landlord would be able to overcome the presumption of retaliation by simply showing that rent is due. See Lewis Properties v. Pruitt, No. UD-19503151516 (Minn. Dist. Ct. 4th Dist. May 11, 1995) (Appendix 99) (landlord overcame presumption that rent increase was retaliatory).
In Smith v. Brinkman and Brinkman v. Smith, Nos. HC-1000124900 and HC-1000202517 (Minn. Dist. Ct. 4th Dist. Mar. 9, 2000) (Appendix 418), in consolidated eviction and rent escrow actions, the court held that landlord failed to prove statutory notice to quit, notice to increase rent given November 1 was not effective to increase rent December 1, and the presumption of retaliation applied to a rent increase notice with the landlord failing to prove a non-retaliatory purpose, citing Minn. Stat. § 504B.441 (formerly § 566.28).
Some local ordinances include protection against retaliation. Minneapolis Code of Ordinances § 244.80 (Appendix 138) provides a presumption of retaliation where the landlord attempts to terminate the tenancy after the tenant complains to the inspection agency, or the tenant of City sues the landlord over housing conditions. The presumption has no time limit. The tenant also may be entitled to rent abatement for retaliation. See discussion, supra, at VI.E.1.d.(3) (Violation of covenants of habitability).
If the defendant proves a retaliatory rent increase, the rent would remain at the pre-increase amount. Line v. Reynolds, No. UD-1960612512 (Minn. Dist. Ct. 4th Dist Aug 12, 1996) (App. 175) (consolidated unlawful detainer and rent escrow actions; tenant proved that proposed 21% rent increase was in retaliation for tenant’s complaints of repair needs, and landlord did not prove that the rent increase was based on other factors); Lundstrom v. Colglazier, No. UD-1960524502 (Minn. Dist. Ct. 4th Dist. Jun. 17, 1996) (Appendix 210) (tenants proved that landlord’s proposed rent increase was in retaliation for complaints about repairs). If the defendant proves a retaliatory decrease in services, it appears that the defendant would be entitled to a rent reduction or a resumption of the pre-decrease level of services. Without such relief, the defense would appear meaningless, since the plaintiff would receive the full rent while the defendant received decreased services. Where the rent is reduced, the appropriate measure of damages would be the same as in the breach of covenants cases. See discussion, supra at VI.E.1. If the defendant fails to prove retaliation, the defendant still would be able to redeem the tenancy by paying the increased rent plus costs. See discussion, infra at VI.E.20.
In manufactured (mobile) home park lot tenancies, under Minn. Stat. § 327C.12, the defendant's protected activity includes a good faith, a complaint to the park owner or a governmental agency or official, or an attempt to exercise rights or remedies pursuant to federal or state law. The 1995 Legislature clarified the application of the statute to a landlord's adverse action against the tenant following the tenant joining and participating in the activities of a resident association. Minn. Stat. § 327C.12, amended by 1995 Minn. Laws Ch. 13, Art. 1. If the plaintiff increases rent, decreases services, alters an existing lease, or seeks possession of the premises, or threatens such action, within ninety (90) days of the defendant's protected activity, the plaintiff has the burden of proving non-retaliation. Id. The retaliatory eviction statute, Minn. Stat. § 504B.285 (formerly § 566.03), subd. 2, which also includes the ninety (90) day test, requires the plaintiff to prove that the notice to quit was not served in whole or part for a retaliatory purpose. If the plaintiff takes any of the listed illegal actions more than ninety (90) days after defendant's protected activity, the defendant must make a prima facie case of retaliation, and then the plaintiff must prove otherwise. Minn. Stat. § 327C.12 (emphasis added).
In Schaff v. Hometown America, LLC, No. A04-1778, 2005 WL 1545525 (Minn. Ct. App. July 5, 2005) (unpublished), manufactured home park residents challenged a park rent increase as being retaliatory. The court of appeals affirmed the trial court ruling that the rent increase in combination with a utility billing decrease resulted in a marginal rent increase which was both reasonable and not retaliatory. See Hellen v. Hometown America LLC, No. A06-1545, 2007 WL 2472337 (Minn. Ct. App. Sept. 4, 2007) (unpublished) (affirmed district court decision that rent increase was not retaliatory).
See Retaliation, infra at VI.E.25, VI.F.3., VI.G.18.
Rent is a sum stipulated for the use and enjoyment of the premises. Ambrozich v. City of Eveleth, 200 Minn. 473, 483, 274 N.W. 635, 640 (1937); Black's Law Dictionary 1166 (5th ed. 1979). Late fees, damage deposits and other fees are not rent, and should not be included as rent in a nonpayment of rent action. Nonpayment of proper late fees, deposits and other fees may constitute a breach of the lease.
Some courts have held that utilities and other charges may be considered rent, entitling defendant to redeem the premises by paying the amount due. These case could support a claim that late fees may be included in a claim for rent. See Central Union Trust Co. v. Blank, 168 Minn. 312, 316, 210 N.W. 34, (1926) (covenant to pay taxes is part of consideration for payment of lease); American Land Real Estate Investment Corp. v. Pokorny, No. C0-90-1649 (Minn. Ct. App. Dec. 18, 1990) (Appendix 53) (unpublished: obligation to buy insurance equivalent to paying rent); Kahn v. Greene, No. UD-1940330506 at 7 (Minn. Dist. Ct. 4th Dist. May 25, 1994) (Appendix 46) (water bill deemed as rent); Schaapveld v. Crump, No. UD-1951011528 (Minn. Dist. Ct. 4th Dist. Oct. 31, 1995) (Appendix 115) (the parties' prior conduct demonstrated that tenants agreed to pay gas utilities and landlord agreed to pay water, sewer and recycling costs).
The tenant must decide whether it is advantageous to litigate late fees in a nonpayment of rent case rather than a breach of the lease case. In a nonpayment of rent case, if the court determines that the late fees are proper and owing, the tenant has the right to redeem the tenancy by paying the unpaid amounts. See discussion, infra at VI.E.20. However, in a breach of lease case, if the court finds that the tenant has not paid proper late fees, the tenant may not have the right to cure the breach of the lease by paying the late fee. See discussion, infra at VI.G.20.
Some leases provide for an additional fee to be paid if the rent is not paid by a certain date. Some leases provide for a flat fee, while others provide for a daily fee. Late fees may be analyzed as liquidated damages or interest. Begin v. Reissman, 1995 WL 348043 (Conn. Super. May 17, 1995) (unpublished) ($5.00 per day late charge constantly accruing was unconscionable and a penalty; 5% of one month's rent or a $25.00 flat fee can be justified by the administrative costs necessary to monitor late payments).
a. Liquidated damages and penalties
In leases, fees based upon a breach of the lease must be in the form of liquidated damages, see Local 34 State, County & Mun. Employees v. County of Hennepin, 310 Minn. 283, 288, 246 N.W.2d 41, 44 (1976) (dictum); and not an unenforceable penalty. See Palace Theatre, Inc. v. Northwest Theatres Circuit, Inc., 186 Minn. 548, 553, 243 N.W. 849, 851 (1932).
Generally, liquidated damages serve as a reasonable forecast of general damages resulting from a breach. Zirinsky v. Sheehan, 413 F.2d 481, 485 (8th Cir. 1969), cert. denied, 396 U.S. 1059 (1970). The controlling factor is whether the amount agreed upon is reasonable or unreasonable in light of the contract as a whole, the nature of the damages contemplated, and the surrounding circumstances, and not the intention of the parties nor their expression of intention. Gorco Const. Co. v. Stein, 256 Minn. 476, 481-82, 99 N.W.2d 69, 74 (1959) (emphasis added). See Meuwissen v. H.E. Westerman Lumber, 218 Minn. 477, 483, 16 N.W.2d 546, 549-50 (1944).
Where actual damages cannot be measured, liquidated damages not manifestly disproportionate to actual damages are enforceable. Gorco, 256 Minn. at 482, 99 N.W.2d at 75. Where actual damages are susceptible of definite measurement, an amount greatly disproportionate is an unenforceable penalty. Id., at 483, 99 N.W.2d at 75.
Liquidated damages can not be recovered if they are not provided for in the lease. Cook v. Finch, 19 Minn. 407, , 19 Minn. (Gil.) 350, 358 (1873). Brooklyn Center Leased Housing v. _____, No. HC 030819518 (Minn. Dist Ct. 4th Dist. Sep. 16, 2003, and Mar. 10, 2004) (Appendix 480) (ambiguities in lease concerning the deposit, rent and pro-rated rent and lack of documentation construed against landlord, no late fees if not contained in lease, redemption; later expunged).
Failure to license the property may block the claim for late fees. Matsumoto v. _____, No. AC 02-2123 (Minn. Dist Ct. 4th Dist. Apr. 19, 2002) (Appendix 534) (Judge Alton) (after license was revoked, landlord’s rental was unlawful and was not entitled to collect rent; rent abatement of $2695; landlord violated shared meter statute, tenant entitled to reimbursement for payments made; landlord not entitled to late fees when he did not have a rental license; landlord proved some cleaning expenses deducted from the security deposit, but not other damages and penalties; tenant entitled to deposit penalties where part of landlord’s withholding was in bad faith).
The actual damages for late payment of rent may be measured without difficulty: the legal rate of interest plus the actual costs caused by the late payment. United Shoe Machinery Co. v. Abbott, 158 F. 762, 763 (8th Cir. 1908). See Mandlin v. American Savings & Loan Ass'n., 63 Minn. 358, 367, 65 N.W. 645, 649 (1896) (actual damages of breach of term to pay money susceptible of definite measurement).
A daily late fee may be excessive. Begin v. Reissman, 1995 WL 348043 (Conn. Super. May 17, 1995) (unpublished) ($5.00 per day late charge constantly accruing was unconscionable and a penalty; 5% of one month's rent or a $25.00 flat fee can be justified by the administrative costs necessary to monitor late payments).
The courts have found certain late fee provisions to be unenforceable penalties. Wheeler v. _____,
No. HC 030905517 (Minn. Dist Ct. 4th Dist. Oct. 3, 2003) (Appendix 594) ($1005 in late fees were
excessive, tenant did not prove habitability violations, tenant may redeem); Miller v. George, No. UD-1941223501 (Minn. Dist. Ct. 4th Dist. Jan. 10, 1995) (Appendix 129) ($25.00 late fee for non-payment of
$10.00 rent is unconscionable); Cherrier v. Harper, No. UD-1940113508 (Minn. Dist. Ct. 4th Dist. Feb. 4,
1994) (Appendix 50) (late charge of $15 if rent was more than one day late, and $20 after two days, was an
unenforceable penalty); Central Community Housing Trust v. Anderson, No. UD-1900611534 at 3 (Minn.
Dist. Ct. 4th Dist. July 6, 1990) (Appendix 18.B) (government subsidized housing: $20.00 late fee bore no
relation to cost of landlord's preparation of form notice and slipping the notice under the tenant's door,
triggering the tenant's prompt action in paying the rent); Auchampach v. IGO Co., Nos. C7-90-10716, C6-90-10559, and S9-90-6084 at 6-7 (Minn. Dist. Ct. 2nd Dist. Dec. 5, 1990) (Appendix 18.C) (late charge of
4 percent of the amount of rent unpaid plus $2.00 per day is excessive and unenforceable, intended as a
penalty for nonperformance of the tenant's obligation to pay rent in a timely manner); Larson v. Cooper, No.
UD-1880209557 at 8 (Minn. Dist. Ct. 4th Dist. Mar. 21, 1988) (Appendix 6) ($10.00 per day late fee was
an unenforceable penalty).
A late was upheld in 606 Vandalia Partnership v. JLT Mobil Building Ltd. Partnership, No. C3-99-1723 (Minn. Ct. App. Apr. 25, 2000) (unpublished) (affirmed District Court conclusions that commercial late fee was a proper liquidated damage and not an unenforceable penalty or unconscionable provision).
Usury elements include: (a) a loan of money or forbearance of a debt, (b) an agreement between the parties that the principal shall be repayable absolutely, (c) the exaction of a greater amount of interest or profit than is allowed by law, and (d) the presence of an intention to evade the law at the inception of the transaction. Rathbun v. W.T. Grant Co., 300 Minn. 223, 230, 219 N.W.2d 641, 646 (1974). Minn. Stat. § 334.01, subd. 1 sets general annual interest rates at 6 and 8 percent.
Usury ordinarily is a question of fact. Kantack v. Kreuer, 280 Minn. 232, 240, 158 N.W.2d 842, 848 (1968). Minn. Stat. § 334.03 provides that where usury is found to exist, the underlying debt is void. However, while courts have invalidated the interest, some courts have been reluctant to void the entire debt. Katz & Lange, Ltd v. Beugen, 356 N.W.2d 733, 735 (Minn. Ct. App. 1984) (12% interest on unpaid legal fees held usurious). In Dairy Farm Leasing Co. v. Sticha, C3-95-2698 (Minn. Ct. App. July 30, 1996), Finance and Commerce at 40 (Aug. 2, 1996) (Appendix 214), the court held that a violation of usury laws does not require specific intent, as long as the party intended to collect the amount of money stated on the face of the contract, and that amount is usurious.
Courts in Minnesota and other jurisdictions have found certain late fees in leases to be usurious. Cherrier v. Harper, No. UD-1940113508 (Minn. Dist. Ct. 4th Dist. Feb. 4, 1994) (Appendix 50) (late charge of $15 if rent of $73 per week was more than one day late, and $20 after two days was usurious); Auchampach v. IGO Co., Nos. C7-90-10716, C6-90-10559, and S9-90-6084 at 6-7 (Minn. Dist. Ct. 2nd Dist. Dec. 5, 1990) (Appendix 18.C) (late fees assessed at rate of 4 percent of the amount of unpaid rent plus $2.00 per day were usurious); Gramith v. Thibodeau, No. UD-1941223506 (Minn. Dist. Ct. 4th Dist. Jan. 13, 1995) (Appendix 100) (late fee limited to $20.00); Fellows v. National Can Co., 257 F. 970 972 (6th Cir. 1919) (10% penalty for ten day delinquency in payment of rent for lease of equipment held usurious): Bonfanti v. Davis, 487 So. 2d 165, 168 (La. Ct. App. 1986) (18% interest charged on late rent held usurious). But see Widmark v. Northrup King Co., 530 N.W. 2d 588 Minn. Ct. App. 1995) (late fee in contract for sale of agricultural seeds was not subject to usury laws).
For an example of calculating annual interest for late fees, see Appendix 51.
Like other lease provisions, late fees can be waived. See discussion, infra, at VI.G.2. See also Chaska Village Townhouses and Lifestyle, Inc. v. Edberg, No. 91-27365 (Minn. Dist. Ct. 1st Dist. Apr. 1, 1991) (Appendix 11.L) (plaintiff induced defendant to believe that late rental payments would continue to be accepted without consequences).
d. Public and subsidized housing
In most government subsidized housing projects, the landlord may not evict the tenant for not paying late fees. HUD Handbook No. 4350.3, ¶ 4-14(d). This provision does not apply to Section 202 Elderly Handicap Housing Projects receiving Section 8 or Rent Supplement assistance. In the two subsidized housing project programs not covered by HUD Handbook No. 4350.3, the Section 8 Moderate Rehabilitation and Project-Based Certificate Assistance Program the regulations do not provide for late fees or other charges in addition to rent. 24 C.F.R. §§ 882.401 et. seq. 882.701 et. seq.
In the Section 8 Existing Housing Certificate program, the landlord may not attempt to evict the tenant for not making additional payments in addition to rent. This arguably includes late fees. HUD Handbook No. 7420.7, ¶ 4-17(c) (Appendix 11.I). Since there is no handbook for the Section 8 Existing Housing Voucher Program, and since the program is almost identical to the Certificate program, it appears that this provision would apply. The Handbook may be out of date, given new regulations, but the regulations only provide for late fees payable by the housing authority for late subsidy payments, and do not provide for tenant late fees. 24 C.F.R. § 982.451.
In public housing, the fees must be reasonable. 24 C.F.R. § 966.4(b)(3).
e. Manufactured (mobile) home park lot tenancies
In manufactured (mobile) home park lot tenancies, the arrearage may not include any fees other than those specified in Minn. Stat. § 327C.03 (certain fees for installation and removal of the home, late rent, pets, maintenance, and security deposits). Minn. Stat. § 327C.10, subd. 1. See Hedlund v. Davis, No. C1-91-1687 (Minn. Dist. Ct. 10th Dist. Dec. 31, 1991) (Appendix 15.F) (improper maintenance charges); Allison v. Sherburne Country Mobile Home Park, 475 N.W.2d 501 (Minn. Ct. App. 1991) (park owner may charge electricity service fee identical to fee residents would have to pay to public utility, even if the fee exceeds the cost to the park owner).
f. No late fee is due because the tenant properly withheld rent
Tenants are not liable for late fees where the tenant property withheld rent. Central Manor Apartments v. Beckman, No. UD-1980513525) (Minn. Dist. Ct. 4th Dist. May 27, 1998) (Appendix 319A) ("When a tenant withholds rent due to habitability issues which are then proven by the tenant, fees for late payment of rent are not due for the month a tenant withheld rent. Assessing a late fee would frustrate the tenant's right to withhold rent to remedy habitability problems, and is contrary to public policy."). The Hornig Companies v. Mmubango, No. UD-1950213513 (Minn. Dist. Ct. 4th Dist. Mar. 6, 1995) (Appendix 93); U and W, Inc. v. Grove, No. UD-1950403505 (Minn. Dist. Ct. 4th Dist. Apr. 25, 1995) (Appendix 111).
g. Plaintiff did not prove existence of late fees
In Smithrud v. McDaniel, No. UD-195050529 (Minn. Dist. Ct. 4th Dist. May 22, 1995) (Appendix 130), neither party testified regarding the landlord's late fee claim of $150.00. The court found that it was not clear what late fees they landlord asserted were due and for which months, concluding that the landlord had not proven that the tenants owed $150.00 for late fees. See Clark v. Urban Investments, No. UD-1970821901 (Minn. Dist. Ct. 4th Dist. Sep. 10, 1997) (Appendix TR 145) (Late fees were not based on lease but on later notice to increase late fees; landlord did not prove it was entitled to unilaterally amend lease to increase late fees); Cedar Associates LLP v. Curtis, No. UD-1970108508 (Minn. Dist. Ct. 4th Dist. May 20, 1997) (Appendix 250) (No late fee in lease); Little v. Katzovitz, No. UD-1970902903 (Minn. Dist. Ct. 4th Dist. Sep. 30, 1997 (Appendix 268) (Landlord did not prove tenants owed prior rents or late fees).
11. Manufactured (mobile) home park lot tenancies
a. Breach of the covenants of habitability. Minn. Stat. § 327C.10, subd. 1. See Larson v. Anderson, No. C9-96-416 (Minn. Dist. Ct. 9th Dist. Oct. 11 and Nov. 8, 1996) (Appendix 264) (Rent abatement of $6,910 over five years failing to repair discharge of raw sewage on the premises; landlord's notice to quit was in retaliation for tenant's complaint to health department). See generally discussion, supra, at VI.E.1.u.
b. Improper notice to terminate the lease. The landlord must give ten (10) days written notice to the tenant and the secured party. Minn. Stat. § 327C.09, subd. 2. See discussion, infra, VI.F.7 (manufactured (mobile) home park lot defenses) and VI.G.11 (manufactured (mobile) home park lot breach defenses).
c. The arrearage includes improper fees. Minn. Stat. § 327C.03, 327C.10, subd. 7. See discussion, supra, at VI.E.10.e (manufactured (mobile) home park lot late fees).
d. Waiver of notice. See Hedlund v. Davis, No. C1-91-1687 (Minn. Dist. Ct. 10th Dist. Dec. 31, 1991) (Appendix 15.F) (waiver of notice alleging failure to pay maintenance charges where landlord accepted and retained rent check and brought it to the hearing). See discussion, infra, at VI.F.4 (waiver of notice).
e. Improper rent increases. See discussion, supra at VI.E.7; Nichols v. Harmon, No. MX-89-8879 (Minn. Dist. Ct. 4th Dist. Apr. 30, 1990) (Appendix 11.G) (rent increases must be reasonable); Pilgrim v. Crescent Lake Mobile Colony, 582 S.2d 649 (Fla. Ct. App. 1991) (Appendix 11.N) (rent increase 15 to 55% above fair market rent with deteriorated conditions was unconscionable).
f. Retaliatory rent increase or services decrease. See discussion, supra at VI.E.9.
h. Redemption. See discussion, infra at VI.E.20.
i. The secured party to the purchase of the manufactured (mobile) home may not bring an unlawful detainer action for nonpayment on the contract. Hermantown Federal Credit Union v. Leddy, No. CX-97-601417 (Minn. Dist. Ct. 6th Dist. Aug. 11, 1997) (Appendix 260) (Remedy is under Minn. Stat. § Ch. 327, not Ch. 566 (now Ch. 504B)).
12. Public and government subsidized housing
Notice requirements vary depending on the program. In government subsidized housing projects and public housing the landlord must give written notice before commencement of an eviction (unlawful detainer) action for nonpayment of rent. See discussion, infra at VI.F.10.
Even if the tenant did not pay the rent, the tenant may argue that nonpayment of rent is simply a prima facie cause for termination of the lease, and that the tenant may rebut the showing that nonpayment was occasioned by circumstances beyond the tenant's control, the tena