Kargman v. Dustin

• Decision Date: 11 February 1977
• Citation: 359 N.E.2d 971,5 Mass.App.Ct. 101
• Parties: Max R. KARGMAN et al. v. Marjorie E. DUSTIN et al.
• Court: Appeals Court of Massachusetts

Page 971

359 N.E.2d 971

5 Mass.App.Ct. 101

Max R. KARGMAN et al.

v. Marjorie E. DUSTIN et al.

Appeals Court of Massachusetts, Suffolk.

Argued March 11, 1976.

Decided Feb. 11, 1977.

Robert J. Doyle, Dorchester, for Marjorie E. Dustin and others.

Ann-Louise Levine, Brockton, for Max R. Kargman and another.

Before HALE, C.J., and KEVILLE and ARMSTRONG, JJ.

KEVILLE, Justice.

The appellants are thirty-five tenants of Battles Farm Company, a limited partnership whose general partners are the appellees, Max R. Kargman and William Kargman (Kargmans). Battles Farm Company owns and operates Battles Farm Village (Battles Farm), a section 236 ¹ multi-family housing development in Brockton. Three of the appellants, David Adelman (Adelman), J. Michael McDermott (McDermott) and Marjorie E. Dustin (Dustin), have been selected by the parties with the approval of this court to represent collectively all of the appellants. ²

A recitation of the procedural vagaries of these cases appears to be unavoidable. The Kargmans received approval to raise the rents at Battles Farm from the United States Department of Housing and Urban Development (HUD). ³ The tenants were notified that the increase would take effect on May 1, 1973. The tenants refused to pay the increase and in July, 1973, brought an action in the United States District Court for the District of Massachusetts challenging the increase. ⁴ That case is still pending.

Following the institution of that action, the Kargmans brought summary process proceedings against more than one hundred of the Battles Farm tenants in the District Court of Brockton for failure to pay the rent increase (increase). The District Court Judge refused to stay the eviction proceedings pending the outcome of the Federal litigation. The tenants applied for a stay in the Supreme Judicial Court. A single justice of that court transferred the petition to this court pursuant to G.L. c. 211, § 4A.

A single justice of this court ordered a stay in the eviction proceedings on the conditions that the tenants pay their base rent (rents paid by the tenants prior to the increase) to the Kargmans and that they pay the disputed increase into the District Court of Brockton or to an escrow account on the first of each month thereafter. The single justice elected to retain jurisdiction over the case in order that the parties might apply for modification or clarification of his orders.

Following certification by the Brockton board of health of violations of the State Sanitary Code at Battles Farm, certain of the tenants began to withhold their base rent pursuant to G.L. c. 239, § 8A, as amended through St.1973, c. 1007, § 3. ⁵ Some of the tenants also complained to the single justice that the requirement that they pay the increase into the District Court of Brockton or to an escrow account had created serious financial hardship for them. On February 8, 1974, the single justice issued a supplementary order in which he referred the sanitary code violation to the District Court of Brockton 'for such action . . . as may be appropriate to determine promptly the merits of the . . . (tenants') defense under G.L. c. 239, § 8A.' With respect to the hardship complaint, the supplementary order stated: 'Upon a determination by the Brockton District Court that such payments would create a hardship to any . . . (tenant), it may reduce the amount of such payments or provide that no payments be required as a condition of the stay.' The order did not alter the tenants' obligation to continue paying the base rent to the Kargmans.

These matters went to trial in the District Court of Brockton in the spring of 1974. The District Court judge decided that the tenants' rent withholding, pursuant to c. 239, § 8A (n. 5), was without merit and he ordered that they pay the Kargmans all of the base rent which they had withheld. He also ordered them to begin to pay the increase into the District Court on a monthly basis. However, he suspended payment of the increase which certain of the tenants had failed to make between May 1, 1973, and May 1, 1974.

The tenants appealed from this decision to the Superior Court. They also moved for leave to waive bond pursuant to G.L. c. 239, § 5, as amended through St.1971, c. 347, § 1. ⁶ The District Court judge allowed these motions but ordered that, in lieu of bond, the tenants, as security, pay the base rent to the landlord and sums representing the increase into the District Court of Brockton on a monthly basis. Thus, the judge in effect reimposed the original order of the single justice of the court. However, as stated above, the latter later modified his order to allow the District Court judge to reduce or eliminate payments of the increase in those cases in which he should find the presence of financial hardship. The District Court order waiving bond included no such provision. But, shortly after the appeals had been filed in the Superior Court, several of the tenants moved in the District Court of Brockton to have the judge modify the increase because of hardship. The judge declined to pass upon that issue ruling that it could then be more appropriately dealt with in the Superior Court.

In the course of the Superior Court proceedings, the differences among the cases represented by Adelman, McDermott and Dustin emerged. In September, 1974, the Kargmans moved to dismiss the appeals of Adelman and McDermott for failure to adhere to the security conditions. The matter was referred to a master who found that Adelman had been at least three weeks late in the payment of his rent in each month from June, 1974, to November, 1974, inclusive, and that McDermott had made no payment in June, 1974, and had been between ten and twenty-four days late in July, August, September and October. In Adelman's case, the master found that the delay in payment of the base rent and his failure to pay the increase was due to financial hardship caused by the illness of his wife and his unemployment. He found, however, that McDermott was able to pay both the base rent and the increase. On May 22, 1975, the Superior Court judge affirmed the master's report and judgment was thereafter entered dismissing the appeals. From that judgment Adelman and McDermott seasonably appealed to this court. In their cases the Superior Court judge did not reach the issue of the unpaid increase. Instead, he ruled that because these tenants would be subject to eviction in new proceedings for failure to pay the base rent, regardless of hardship, failure to make timely base rent payments was a sufficient reason for dismissal of the their appeals.

Turning to Dustin's case, while her appeal was pending, she paid the base rent to the landlord regularly but failed to pay the increase into the District Court. The Kargmans moved for dismissal of her appeal for failure to pay the increase. In response, Dustin moved for leave to waive or reduce the rent increase requirement on the basis of hardship. The Superior Court judge who had passed upon the cases of Adelman and McDermott dismissed Dustin's appeal. While he found that hardship had in fact been the cause of her failure to pay the increase, he ruled, as matter of law, that hardship did not excuse failure to comply with the conditions of appeal. Dustin has seasonably appealed to this court from that judgment.

Resolution of the issues presented on these appeals calls for an attempt to balance the rights and obligations between two socio-economic groups, landlords and tenants. ⁷ On the one hand, tenants are entitled to their day in court before they can be evicted since courts were not intended to function simply as rubber stamps for landlords seeking to remove their tenants. Pernell v. Southall Realty, 416 U.S. 363, 385, 94 S.Ct. 1723, 40 L.Ed.2d 198 (1974). On the other hand, landlords are entitled to reasonable assurance that rent due will continue to be paid while protracted eviction proceedings for nonpayment of rent are pending. Bell v. Tsintolas Realty Co.,139 U.S.App.D.C. 101, 430 F.2d 474, 481--482 (1970).

The specific question for decision here is whether the Battles Farm tenants should be permitted to have their cases tried to a jury in the Superior Court on appeal from the judgment of the District Court despite the fact that they failed to satisfy the conditions of appeal imposed in lieu of bond by the District Court judge. Because of the differences in their economic condition and in their response to the District Court order, their appeals merit individual discussion. As stated above McDermott was late in his payments of base rent; and he failed to pay the increase into the District Court although, according to the master's findings, his was not a hardship case. Adelman was late in paying his base rent and delinquent with respect to the increase; but the master found has to be a hardship case. Dustin paid the basic rent but failed to pay the increase, a failure which the Superior Court judge found to be due to hardship.

1. The issue in McDermott's appeal is uncomplicated. He does not seriously challenge the master's finding that his failure to pay the base rent on time was not based upon financial hardship. The thrust of his argument appears to be that his chronic tardiness caused no prejudice to the Kargmans because it was customary for tenants at Battles Farm to be tardy in the payment of their rent and because the payment, when eventually made, did in fact secure the landlord against financial loss should he prevail on appeal. That argument is to be rejected out of hand.

Courts should not be obliged to play the part of rent collection agencies (see Cooks v. Fowler, 148 U.S.App.D.C. 245, 459 F.2d 1269, 1277 (1971)), and landlords who are dependent upon monthly rent payments to cover operating expenses should not be obliged to engage in constant speculation as to the point within each month rents are to be received from their tenants.

In the usual case, where rent...