Miles v. Shauntee, LEXINGTON-FAYETTE

• Decision Date: 12 October 1983
• Docket Number: LEXINGTON-FAYETTE
• Citation: 664 S.W.2d 512
• Parties: Ethal MILES, Movant, v. Kenneth SHAUNTEE, Respondent. COMMONWEALTH of Kentucky, ex rel. Steven L. BESHEAR, Attorney General, Movant, v. Kenneth SHAUNTEE, Respondent.URBAN COUNTY GOVERNMENT, Movant, v. Kenneth SHAUNTEE, Respondent. Joe CISSELL, Movant, v. Phillip RUSH, Respondent.
• Court: United States State Supreme Court — District of Kentucky

Page 512

664 S.W.2d 512

Ethal MILES, Movant, v. Kenneth SHAUNTEE, Respondent.

COMMONWEALTH of Kentucky, ex rel. Steven L. BESHEAR, Attorney General, Movant, v. Kenneth SHAUNTEE, Respondent.

LEXINGTON-FAYETTE URBAN COUNTY GOVERNMENT, Movant, v. Kenneth SHAUNTEE, Respondent.

Joe CISSELL, Movant, v. Phillip RUSH, Respondent.

Supreme Court of Kentucky.

Oct. 12, 1983.

Rehearing Denied Feb. 16 and March 8, 1984.

Robert Frederick Smith and Barry L. Master, Legal Aid Society, Inc., Louisville, for Ethal Miles (movant).

Shrader R. Miller, Louisville, amicus curiae for Louisville Apartment Association.

Anne Marie Regan, Louisville, Richard E. Blumberg, Berkeley, Cal., amicus curiae for National Housing Law Project.

Steven L. Beshear, Atty. Gen., Kevin M. Noland and Barbara J. Bryant, Asst. Attys. Gen., Consumer Protection Div., Frankfort, for Commonwealth of Kentucky, Ex Rel. Steven L. Beshear, Attorney General (movant).

Barbara B. Edelman, Director Division of Litigation, and Rena Gardner Wiseman, Corporate Counsel, Dept. of Law, Lexington, for Lexington-Fayette Urban County Government (movant).

Ben Hardy, Louisville, for Kenneth Shauntee (respondent).

Mark D. Esterle, Cumberland Trace Legal Services, Inc., Bowling Green, for Joe Cissell (movant).

Lee Coleman and William Ward Allen, Caudill & Allen, Bowling Green, for Phillip Rush (respondent).

WILLIAM M. DEEP, Special Justice.

This is a civil action which originated between Ethal Miles (hereinafter referred to as "tenant") and Kenneth Shauntee (hereinafter referred to as the "landlord").

In October, 1979, the landlord filed a Writ of Forcible Entry and Detainer against the tenant concerning the property located at 1780 Wilson Avenue, Louisville, Kentucky.

The tenant filed a counterclaim requesting damages due to the numerous defective conditions existing in the rental housing unit. Since the damages requested by the tenant by way of counterclaim exceeded the jurisdictional amount of the Jefferson District Court, this matter was transferred to the Jefferson Circuit Court.

Discovery followed after which the Court considered a Motion to dismiss that portion of the tenant's Answer and Counterclaim which sought to state a cause of action based on Kentucky's adoption of the Uniform Residential Landlord and Tenant Act, KRS 383.505-383.715 (hereinafter referred to as the "URLTA"), enacted in 1974. In comparison to the common law it replaced, the URLTA more specifically establishes the rights and obligations of both landlords and tenants.

In a Memorandum Opinion entered January 8, 1981, the Circuit Court held the URLTA in its present form, applicable to counties containing cities of the first class and urban county governments, unconstitutional as special legislation. Pursuant to Civil Rule 24.03 and KRS 418.075, the Circuit Court in its Memorandum Opinion directed that a copy of said Opinion be sent to the Attorney General, who was given an opportunity to file a Motion to Intervene and be heard before entry of a judgment.

The Commonwealth of Kentucky ex rel. Steven L. Beshear, Attorney General, filed a Motion to Intervene in this action which was granted by the Jefferson Circuit Court. After the Commonwealth filed its memorandum, the Jefferson Circuit Court maintained its position that the URLTA is unconstitutional as special legislation. As a result, in its Pre-Trial Order dated March 27, 1981, the Circuit Court granted summary judgment for the landlord as to the tenant's counterclaim based on the URLTA, and this ruling was later made a final appealable judgment on April 10, 1981. Both the Commonwealth and the tenant appealed this judgment.

Subsequently, on May 5 and 26, 1981, the Court held a hearing on the merits. After the hearing on the merits, the Jefferson Circuit Court ruled that the housing conditions in question were dilapidated, but declined to recognize a cause of action for the tenant based either on an implied warranty of habitability or on the Kentucky Consumer Protection Act. In addition, the Jefferson Circuit Court found the premises not uninhabitable. The Jefferson Circuit Court dismissed the tenant's counterclaim and sustained the landlord's forcible detainer action. The tenant appealed from these Findings of Fact and Conclusions of Law entered by the Circuit Court.

The Lexington-Fayette Urban County Government on July 19, 1981, filed a Motion to Intervene in this case, which was granted by the Court of Appeals on August 7, 1981.

At the same time on appeal was the case of Joe Cissell v. Phillip Rush which was on appeal from the Warren Circuit Court. In this case, the counterclaims of the tenant, Joe Cissell, alleging that Rush had violated an implied warranty of habitability, and that violations of the housing code of the city of Bowling Green constituted violations of the Consumer Protection Act, KRS 367.170 as unfair, false, misleading and deceptive acts or practices in the conduct of the landlord's trade were dismissed by the Warren Circuit Court without any findings of fact thereon. Because the Cissell v. Rush case involved the same legal issues regarding the implied warranty of habitability and the applicability of the Kentucky Consumer Protection Act, the Court of Appeals ordered that the two cases be heard together.

On July 16, 1982, the Court of Appeals rendered an opinion on the consolidated appeals. In that opinion, the Court of Appeals held that the URLTA is unconstitutional, that no implied warranty of habitability is recognized within the Commonwealth, and that the Consumer Protection Act is inapplicable.

Petitions for Rehearing were filed with the Court of Appeals by Joe Cissell and Lexington-Fayette Urban County Government. Both petitions were denied. On October 28, 1982, this Court issued an Order granting the Motions of Ethal Miles and Commonwealth of Kentucky, ex rel. Steven L. Beshear, Attorney General, for discretionary review. On December 7, 1982, this Court issued an Order granting the Lexington-Fayette Urban County Government's Motion for Discretionary Review. At the same time this Court ordered that the above cases together with the case of Joe Cissell v. Phillip Rush, be consolidated to the extent that they be heard together.

The above cases present three novel and important questions: Whether the Kentucky Uniform Residential Landlord and Tenant Act (URLTA) as limited by KRS 383.715 to counties containing cities of the first class and urban-county governments constitutes "local" or "special" legislation in violation of Sections 59 and 60 of the Kentucky Constitution; whether an implied warranty of habitability should be recognized as applying to landlord-tenant agreements; and whether the failure of a landlord to comply with local code provisions constitutes a violation of the Kentucky Consumer Protection Act, KRS 367.170 as an unfair, false, misleading and deceptive act or practice. In addition to the three questions above outlined, the appellant Miles has raised questions regarding certain procedural and evidentiary error committed by the Jefferson Circuit Court, and the appellant Commonwealth of Kentucky, ex rel. Steven L. Beshear, Attorney General, has raised the question regarding the landlord's standing to challenge the constitutionality of the URLTA.

This opinion will first address the issues of standing and the constitutionality of the URLTA, second, the status of the implied warranty of habitability in Kentucky, third, the application of the Consumer Protection Act to the factual circumstances presented by the Motions for Discretionary Review, and fourth, the procedural and evidentiary errors committed by the Jefferson Circuit Court.

I.

WHETHER THE URLTA AS LIMITED TO THE COUNTIES CONTAINING CITIES OF THE FIRST CLASS AND URBAN-COUNTY GOVERNMENT CONSTITUTES "LOCAL" OR "SPECIAL" LEGISLATION IN VIOLATION OF SECTIONS 59 AND 60 OF THE KENTUCKY CONSTITUTION.

URLTA is an adoption of our General Assembly of the Model Residential Landlord-Tenant Code. ¹ The Kentucky Legislature adopted the Act, recognizing what progress had been made in other legislatures in the tenant-landlord area. ² It realized that Anglo-Saxon agrarian common laws, which had been the foundation of tenant-landlord relationships, provided scant relevance to such current matters, particularly in urban areas. McCabe.

As noted by McCabe in his comments on URLTA:

But the 250 practicing lawyers, judges and law professors who drafted the act agreed the basic reform of the landlord-tenant laws could prevent marginal housing from sliding into the area of "uninhabitable housing"--and then, inevitably, into abandonment.

Present laws in most states encourage landlords to "defer maintenance" to net high short-terms profits and tax benefits. In this way apartment buildings die by degree as plumbing, electrical and other systems decay and eventually stop functioning entirely. At the same time, trash and garbage piles up, yards or common areas are unusuable, and the property becomes a neighborhood eyesore eventually, fit only as housing for rats.

Whenever a building reaches that point where taxes, mortage rates and other fixed expenses eat up all the rent collected from tenants who have a decreasing ability to pay it, the property is unsalvageable. That's why the Uniform Residential Landlord and Tenant Act is aimed at keeping decent housing clean and safe.

Our legislature, by placing duties to care for the property on both the landlord and tenant (see KRS 383.595 and KRS 383.605, respectively), has attempted to keep the property on the market, provide a fair return for the landlord, and provide the tenant with a habitable place to live.

URLTA was enacted by the Legislature with the specific purposes and policies of encouraging landlords and tenants to maintain and improve the quality of housing and to make uniform the law with respect to the subject of URLTA among those states which enact it. KRS 383.505(2)(a) and (b). Section 383.530 ...