Benik v. Hatcher

• Decision Date: 19 April 2000
• Docket Number: No. 20,20
• Citation: 750 A.2d 10,358 Md. 507
• Parties: Joseph BENIK, et. al. v. Brandon HATCHER, a minor, et al.
• Court: Maryland Court of Appeals

750 A.2d 10

358 Md. 507

Joseph BENIK, et. al. v. Brandon HATCHER, a minor, et al.

No. 20, Sept. Term, 1998.

Court of Appeals of Maryland.

April 19, 2000.

Kevin M. Murphy (William J. Carter, Lori A.F. Ridgeway, Carr Goodson Lee & Warner, on brief), Rockville, for petitioners.

Saul E. Kerpelman (Alan J. Mensh, Saul E. Kerpelman & Assocs., on brief), Baltimore, for respondents.

M. Albert Figinski, Weinberg & Green, LLC, Baltimore, Amicus Brief, for Maryland Multi-Housing Assoc.

William C. Parler, Jennifer S. Cavey, Parler & Wobber, L.L.P., Baltimore, Amicus

Curiae, for Property Owners Assoc. of Greater Baltimore, Inc.

Craig A. Berrington, Laura L. Kersey, Washington, DC, Amicus Curiae, for American Ins. Assoc.

H. Thomas Howell, David A. Carter, Sandra A. Tofte, Howell, Gately, Whitney & Carter, LLP, Towson, Amicus Curiae, for American Ins. Assoc.

Kenneth W. Strong, Baltimore, Amicus Curiae, for Maryland Trial Lawyers Assoc.

Argued before BELL, C.J., and ELDRIDGE, RODOWSKY, RAKER, WILNER, CATHELL and HARRELL, JJ.

BELL, Chief Judge.

In this case, we are asked to decide whether, under the Consumer Protection Act ("CPA"), Maryland Code (1975, 1990 Repl.Vol.) Title 13 of the Commercial Law Article, specifically § 13-301(1), (2) and (3),¹ proof of scienter is a prerequisite to holding a landlord liable for breach of warranty for injuries resulting from a child's ingestion of lead-based paint, when the child's dwelling, at the inception of the lease, contained chipping and flaking paint, in violation of the local housing code.² The Court of Special Appeals held that scienter is not required and, so, reversed the judgment of the trial court. We shall affirm the intermediate appellate court, but on a somewhat different analysis.

I.

The genesis of this case was a complaint that alleged that five year-old Brandon Hatcher, the respondent, suffered lead poisoning while living in apartment # 310 in an apartment building located at 1411 Division Street, owned by Joseph Benik, the petitioner. Brandon and his family moved into the apartment in January 1990 and in December 1990, an inspection of the apartment revealed that lead paint was present in several areas throughout the apartment. After the discovery of the lead paint, the family moved to another apartment in the same building.

Brandon's mother received Section 8³ assistance to subsidize her rental payments while she and her family lived at 1411 Division Street. Thus, consistent with Section 8 procedures, on January 2, 1990, prior to the family moving into the apartment, an inspection of the unit was conducted by a Section 8 housing inspector. That inspector testified at trial that the apartment passed the Section 8 inspection, which included inspecting each room in the unit for the presence of chipping or flaking paint. Confirming the inspector's testimony, the petitioner testified that he had painted the apartment several weeks before the inspection. He also testified that Mrs. Hatcher was in the apartment and inspected it herself before entering into the lease. Further, the petitioner stated that, several months earlier, when she rented another apartment in the same building, Mrs. Hatcher signed a statement that she had received a booklet regarding the hazards of lead-based paint.

The testimony of both the Section 8 inspector and the petitioner was contradicted by the testimony of Chakeda Hatcher, Brandon's sister. Twelve years old when the Hatcher's moved into the unit, Chakeda stated that the apartment was not freshly painted when the family moved in. She described chipping paint on the wall, ceiling, around the door frame, and the windowsills. She also stated that she saw chipping paint in the bathroom and in two bedrooms. Chakeda further testified that she witnessed Brandon with a chalky substance around his hands and mouth after he had been playing near holes located at the baseboard of the apartment. She specifically stated that the holes were present when they moved into the apartment. Finally, Chakeda testified that the petitioner was in the apartment before the lease began, talking to her mother.

Chakeda's testimony was corroborated by Brandon's aunt, Eileen Hatcher, who testified that she resided in apartment # 214 the entire time her sister and nephew lived in apartment # 310. Ms. Eileen Hatcher testified that she visited her sister within the first month of her moving into apartment # 310 and observed, at that time, that the unit was not freshly painted. She further stated that, on different occasions, when she visited the apartment, the paint on the windowsill of the middle room and kitchen was peeling and flaking.

On October 17, 1990, Brandon was diagnosed with lead poisoning, having been found to have an elevated blood lead level. At that point, the family moved out of their apartment and into another unit. Brandon's blood lead level began to decline once the family moved out of apartment # 310. On December 3, 1990, the Baltimore City Health Department conducted an investigation at the residence, finding lead paint nuisances in sixteen areas throughout the apartment, around the frames, baseboards, and windows. That inspection and its findings resulted in the issuance to the petitioner of an emergency violation notice and an order to remove the lead paint nuisance.

Suit was filed in the Circuit Court for Baltimore City⁴ against the petitioner.⁵ Although the complaint contained five counts, only two of them, those alleging negligence and violation of the Consumer Protection Act, survived the pre-trial practice. Those counts proceeded to trial before a jury. At the end of the case, the trial court gave the following instruction as to the Consumer Protection Act:

"Plaintiff has made a claim under the Maryland Consumer Protection Act. In order to recover damages under this act, the Plaintiff must prove more likely than not the following: One, that at the beginning of the lease of Apartment 310, there was chipping and flaking lead-based paint; and two that Mr. Benik was aware of the chipping and flaking lead-based paint, and also aware that its condition may constitute an unreasonable risk of harm to the tenants. And three, that despite the above, the Defendant, Mr. Benik failed to disclose the hazardous condition to Linda Hatcher at the beginning of the lease. And Four, that Brandon Hatcher was injured as a direct, proximate result of the alleged hazardous condition that existed at the time of the lease; that is chipping or flaking lead based paint. If any of the above elements are missing, the claim hereunder should be decided in favor of the defendant." (emphasis added).

The respondent excepted to this instruction, asking the court to give his proposed instruction instead. The respondent's proposed instruction did not require the jury to find scienter on the part of the petitioner, that the petitioner be aware that the chipping and flaking paint was lead-based paint or that the condition was an unreasonable risk to the respondent.

The jury returned a verdict in favor of the petitioner on all counts. The respondent noted an appeal to the Court of Special Appeals. In an unpublished opinion, that court affirmed the trial courts evidentiary rulings, but reversed its judgment with respect to the Consumer Protection Act ("CPA"). The intermediate appellate court reasoned:⁶

"Golt [v. Phillips, 308 Md. 1, 517 A.2d 328 (1986)

] holds that these subsections do not require scienter. Richwind [Joint Venture 4 v. Brunson, 335 Md. 661, 645 A.2d 1147 (1994) ] and Scroggins [v. Dahne, 335 Md. 688, 645 A.2d 1160 (1994) ] hold that with lead-paint issues as between a landlord and a tenant, the CPA only applies at the inception of the lease and a landlord cannot be held strictly liable throughout the term of the lease. Reading the cases and the CPA together, we find no prohibition against finding a landlord strictly liable for acts or omissions at the beginning of the lease. Indeed, at the beginning of a lease, landlords are in a better position than tenants to know of any defects within a rental property. We, therefore, hold that the CPA does not always require scienter. Whether there is a viable strict liability cause of action under the CPA in this case can be determined by a two-pronged test: 1) Did the landlord commit an act or omission that falls under one of the CPA's subsections that does not require knowledge, and 2)Was the act or omission of the landlord at the inception of the lease?"

The petitioner timely filed a Petition for Writ of Certiorari, which we granted to consider the important issue this case presents.

II.

The petitioner's primary argument is that, where the landlord does not have actual knowledge or reason to know of the condition, the CPA does not impose strict liability on a landlord in lead-based paint cases for failing to inform tenants at the inception of the lease that the premises contain chipping or flaking lead-based paint. Relying on Scroggins v. Dahne, 335 Md. 688, 645 A.2d 1160 (1994); Richwind Joint Venture 4 v. Brunson, 335 Md. 661, 645 A.2d 1147 (1994) and Hayes v. Hambruch, 841 F.Supp. 706 (D.Md.1994),aff'd, 64 F.3d 657 (4 th Cir.1995),⁷ he contends that "a required element of any claim for personal injury under the CPA based on an alleged omission is scienter, or that the landlord know, or have reason to know, of the alleged hazard or condition." That is consistent, he maintains, with the common law requirement that a landlord have notice of a defect and the opportunity to correct it before being held liable. Therefore, the petitioner asserts:

"The Court of Special Appeals' ruling misinterprets prior decisions of this Court, directly contradicts a federal court decision on the same issue, and fails to acknowledge that its decision reverses many years of common law precedent on the issue of notice, without any clear proof of an intent on the part of the legislature to make such a sweeping change ... [and]

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