Miller v. Ritchie

• Decision Date: 06 September 1989
• Docket Number: No. 88-1296,88-1296
• Citation: Miller v. Ritchie, 45 Ohio St.3d 222, 543 N.E.2d 1265 (Ohio 1989)
• Parties: MILLER, Appellee, v. RITCHIE et al., Appellants.
• Court: Ohio Supreme Court

Page 222

45 Ohio St.3d 222

543 N.E.2d 1265

MILLER, Appellee, v. RITCHIE et al., Appellants.

No. 88-1296.

Supreme Court of Ohio.

Submitted May 30, 1989.

Decided Sept. 6, 1989.

Syllabus by the Court

1. A tenant does not waive the right to recover damages for a landlord's breach of duty to maintain rental property when the tenant pays rent and tries to persuade the landlord to make repairs rather than pursue statutory remedies under R.C. 5321.07.

2. Where a landlord has been placed on notice of a tenant's claim, the tenant's occupancy of defective rental premises over a lengthy period of time does not constitute a waiver of the landlord's duty to maintain the premises as required by R.C. 5321.04 or a waiver of the tenant's right to recover for damages resulting from the landlord's breach of duty.

3. Where a landlord breaches a duty to maintain rental property and the tenant does not make the repairs, the measure of damages is the difference between the rental value of the property in its defective condition and what the rental value would have been had the property been maintained. (Smith v. Padgett [1987], 32 Ohio St.3d 344, 513 N.E.2d 737, paragraph one of the syllabus, followed.)

In 1984, appellants, Anthony and Belinda Ritchie, rented an apartment in Bethel, Ohio, from appellee, Dexter Miller. The parties entered into an oral, month-to-month tenancy agreement at $200 per month.

The Ritchies occupied the apartment for over two years. Throughout their occupancy the apartment contained serious defects, including faulty and dangerous electrical wiring, holes in the floor, inadequate plumbing, and no heating system. ¹ With few exceptions, the landlord, Miller, disregarded the Ritchies' requests for repairs.

In February 1987 Miller initiated a forcible entry and detainer action against the Ritchies seeking restitution of the apartment and unpaid rent. The Ritchies counterclaimed for damages based on Miller's failure to maintain the property as required by Ohio's Landlords and Tenants Act.

The Ritchies voluntarily vacated the apartment in March or April 1987. The parties stipulated that the Ritchies owed four months' rent, but did not agree on the value of the rent.

The trial court found Miller had violated his duty to maintain the Ritchies' apartment as required by R.C. 5321.04 of the Landlords and Tenants Act, ² and the court granted judgment for the Ritchies in the amount of $3,000 plus interest and costs. The court also awarded Miller $800 for the four months' unpaid rent.

The court of appeals found the Ritchies were not entitled to damages because they continued to occupy the apartment over an extended period of time without pursuing statutory remedies under R.C. 5321.07. Accordingly, the court reversed the lower court's judgment in favor of the Ritchies.

The cause is before this court pursuant to the allowance of a motion to certify the record.

Moore, Moore & Moore and Joseph G. Carroll, Cincinnati, for appellee.

Legal Aid Soc. of Cincinnati, John E. Schrider, Jr., Clermont County Legal Aid Soc. and Lisa E. O'Rear, Cincinnati, for appellants.

Legal Aid Soc. of Cleveland, Peter M. Iskin, Cleveland, and Barbara A. Reitzloff, urging reversal for amicus curiae, Cleveland Tenants Organization.

HERBERT R. BROWN, Justice.

The record clearly demonstrates Miller was aware of the defects in the Ritchies' apartment, yet failed to maintain the leasehold as required by law. The record also establishes that the Ritchies were aware of escrow procedures, but did not escrow rent or pursue the remedies provided by R.C. 5321.07. The issues for our resolution are: (1) whether the Ritchies waived the right to recover damages by occupying the defective rental premises for over two years without pursuing the remedies provided in R.C. 5321.07, and (2) whether the trial court properly computed damages. ³ For the following reasons we find the Ritchies did not waive their right to recover damages and the trial court erred in computing damages.

I

Ohio's Landlords and Tenants Act imposes duties on landlords which were absent at common law. The General Assembly enacted R.C. 5321.07 to provide tenants with leverage to redress breaches of those duties. When a landlord fails to maintain rental property in accordance with statutory or contractual obligations, R.C. 5321.07 allows a tenant to: (1) deposit rent with the court, (2) apply for a court order directing the landlord to remedy the condition, or (3) terminate the rental agreement. As a prerequisite to utilizing these remedies, the tenant must be current in rent payments and must notify the landlord in writing of the violations.

R.C. 5321.07 should not be construed as the exclusive remedy for tenants aggrieved by a landlord's breach of duty. The language of the statute is discretionary, providing that " * * * the tenant may * * * " use one of the remedies provided in the statute "[if] a landlord * * * after receipt of * * * notice fails to remedy the condition within a reasonable time * * * and if the tenant is current in rent payments * * *." (Emphasis added.) As stated in our decision in Shroades v. Rental Homes (1981), 68 Ohio St.2d 20, 25, 22 O.O.3d 152, 155, 427 N.E.2d 774, 777:

" * * * [T]he remedies provided in R.C. Chapter 5321 are cumulative * * *. For example, the remedy of depositing rental payments with the clerk of court is grossly inadequate to compensate tenants for [personal injuries] * * *. An alternative remedy of termination of the lease is also not an adequate or viable option for many tenants when there is a lack of availability of other apartments and considering the costs involved in relocating. Thus, the new remedies given tenants in R.C. Chapter 5321 are intended to be preventive and supplemental to other remedial measures."

Although risking eviction, a tenant who withholds but does not escrow rent does not waive the right to recover damages caused by a landlord's breach of duty. The forcible entry and detainer statute, R.C. 1923.061(B), states: "In an action for possession of residential premises based upon nonpayment of the rent or in an action for rent when the tenant is in possession, the tenant may counterclaim for any amount he may recover under the rental agreement or under Chapter 3733. or 5321. of the Revised Code." R.C. 5321.03 authorizes a landlord to bring a forcible entry and detainer action and provides in division (B) that "[t]he maintenance of an action by the landlord under this section does not prevent the tenant from recovering damages for any violation by the landlord of the rental agreement or of section 5321.04 of the Revised Code."

Similarly, a tenant does not waive the right to recover damages for a landlord's breach of duty to maintain rental property when, as happened here, the tenant pays rent and tries to persuade the landlord to make repairs rather than pursue R.C. 5321.07 remedies. Resolution of landlord-tenant conflicts without litigation should be encouraged, not penalized.

The fact that the Ritchies pursued only this latter remedy for over two years does not mean they acquiesced in the defective condition of the apartment. Rather, the record indicates, from the onset of the Ritchies' occupancy, that Miller promised to fix any problems in the apartment and Mr. Ritchie repeatedly requested Miller to make repairs.

Moreover, a tenant's acquiescence in the defective condition of an apartment does not relieve the landlord of the duty to maintain the apartment in conformance with R.C. 5321.04. Nor does it constitute an enforceable contractual waiver of the tenant's right to recover damages. The Landlords and Tenants Act prohibits any agreement between the landlord and tenant which purports to waive the landlord's duty to maintain the premises and any agreement that purports to waive the tenant's right or ability to bring an action for damages. R.C. 5321.13 ⁴; 5321.06. ⁵ 1 Restatement of the Law 2d, Property, Landlord & Tenant (1977) 360, Section 11.1, Comment g, states: "The tenant is entitled to an abatement of the rent at any time after the landlord's default. Failure to assert this right is not a waiver of it. When he asserts the right, the abatement will relate back to the date when he was first entitled to it. * * * "

This is not to say that a tenant may delay indefinitely before asserting his legal right to recover damages. Ohio law provides defenses to those aggrieved by a party's delay in asserting rights. These defenses include laches, equitable estoppel, and statutes of limitations. None of these defenses were raised by Miller. None are supported by the record.

We hold that where a landlord has been placed on notice of a tenant's claim, the tenant's occupancy of defective rental premises over a lengthy period of time does not constitute a waiver of the landlord's duty to maintain the premises as required by R.C. 5321.04 or a waiver of the tenant's right to recover for damages resulting from the landlord's breach of duty.

II

We turn to the question of whether the trial court properly computed damages.

In awarding the Ritchies the amount of $3,000, the jurisdictional maximum, ⁶ the trial judge explained his reasoning as follows:

"The reason that I use $3,000.00, I'm finding that they didn't get any benefit from what they were doing, that the photographs clearly show they didn't get it. The cost, as testified by the Electrical Inspector, simply points it up, and the only reason it's not more than $3,000.00 is that's all the law let's me do."

The finding that the Ritchies obtained no benefit from the apartment conflicts with the award to Miller of $800, the full rent for four months. If the property had no value, then an award of back rent to Miller was inappropriate. If the property had a value less than the rental price but greater than zero, as seems probable, the trial court erred in failing to identify that value and award damages accordingly.

In order to sustain the trial court's...