Wednesday, May 25, 2011

Tenant Issues Can Be a Minefield, Don’t Go It Alone

The 4 corners of a contract prevailed this past Monday.  A landlord had entered into a settlement agreement with a tenant.  The court upheld an eviction based on a breach of the settlement agreement.  Don't go it alone if you are a landlord with tenant issues.  I can guide you through the intricacies of landlord/tenant law. 

In the case of Kleinman Realty Co. v. Talbot, 2011 WL 1938184 (Minn. Ct. App. May 23, 2011), the Court of Appeals determined that, in a landlord/tenant situation, the express words of a settlement agreement govern.  This is in spite of the Court's sympathies to the tenant for her situation and recognition that the district court approached this case in a spirit of charity.  The Court stated:
It is awkward for us to describe the district court's abundance of compassion with the usual legal tags of "erroneous" or "abuse of discretion."  But our mandate is to correct legal errors, and we are bound here to conclude that the district court made a decision more generous toward a tenant than the law allows.

Kleinman manages an 11-unit apartment building in St. Paul.  Talbot had been a tenant since 1984 on a month-to-month oral lease.  St. Paul requires periodic inspections of apartment buildings.  On January 14, 2010, Talbot refused to allow the city inspector entry.  The city inspector stated that "the excessive amount of clutter he saw inside the apartment even from the outside the door was such that he believed the unit would fail the . . . inspection."  Based on the failure to allow the inspector on the property Kleinman gave a one-month notice of termination of the lease.  In Minnesota, an oral lease may be terminated by providing notice of termination, which termination date must be not less then the period the rent is due or three months, whichever is less.  Minn. Stat. §504B.135.  Before the termination date, an inspection was conducted and the unit failed because it was unsanitary.  Talbot did not vacate at the termination date.

The unit failed two subsequent re-inspections.  The city informed Kleinman that due to the continued failed inspections that the entire apartment building could lose its certificate of occupancy.  Then Kleinman gave an eviction notice to Talbot because she was holding over after the termination date.  Kleinman's attorney indicated that she was disabled by an obsessive-compulsive disorder, depression and fibromyalgia, which caused her to "accumulate possessions excessively and makes it difficult for her to timely prepare her unit for inspections."

Kleinman gave her another chance and the parties executed a settlement agreement.  In it Kleinman agreed not to file an eviction action until after a fourth inspection was conducted by the city on March 24.  Kleinman also agreed to rescind the termination notice if the unit passed the inspection.  Talbot agreed to vacate if the unit failed the March 24 inspection.  The unit failed and Talbot did not vacate.

On March 29, 2010, Kleinman commenced an eviction action based on the failure to vacate as required by the settlement agreement.  On April 2 the unit passed a re-inspection and then Talbot filed her answer asserting she was "disabled, that her disability prevented her from timely complying with the settlement agreement, and she was entitled, under the Minnesota Human Rights Act, to . . . an additional reasonable accommodation of the [nine] days necessary to satisfactorily clean the apartment".

The only issue for determination in an eviction proceeding is whether the facts alleged in the complaint are true.  The district court did find that the allegations in the complaint were true; mainly that Kleinman had the right to evict Talbot under the settlement agreement regardless of whether she passed the April 2 inspection.  Despite this finding, the district court found that Talbot was entitled to the accommodation and that she substantially complied with the settlement agreement.  

The Court of Appeals reversed this decision stating that the "district court lacked the legal grounds to treat Talbot's reasonable accommodation argument as an affirmative defense to the eviction action."  The Court continued to review the matter, recognizing the Kleinman already granted Talbot's request for an accommodation in the form of extra time to prepare her unit for the inspections.  Instead of making further request, Talbot chose to disregard its terms.  Further, the Court had doubts that an accommodation that prolonged the unsafe condition could be "reasonable".

This case illustrates the problems a landlord can have with a tenant.  In my This could have been avoided (or at least more controlled) if there had been a well-written lease.  A written lease is good for both the tenant and the landlord providing both with protections and bringing certainty to the relationship.  The most difficult, time consuming and expensive landlord/tenant matters result from a lack of written lease.

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