Opinion
23A-EV-2806
05-29-2024
Chandan Saha, Appellant-Plaintiff v. Daniel Ebben, Appellee-Defendant
ATTORNEY FOR APPELLANT Matthew Foster Foster Law, LLC Indianapolis, Indiana ATTORNEYS FOR APPELLEE Gregory A. Schrage Peter J. Hutson Sloan R. Schafer Church Church Hittle & Antrim Noblesville, Indiana
Pursuant to Ind. Appellate Rule 65(D), this Memorandum Decision is not binding precedent for any court and may be cited only for persuasive value or to establish res judicata, collateral estoppel, or law of the case.
Appeal from the Hamilton Superior Court The Honorable Darren J. Murphy, Judge Trial Court Cause No. 29D07-2306-EV-6033
ATTORNEY FOR APPELLANT
Matthew Foster
Foster Law, LLC
Indianapolis, Indiana
ATTORNEYS FOR APPELLEE
Gregory A. Schrage
Peter J. Hutson
Sloan R. Schafer
Church Church Hittle & Antrim
Noblesville, Indiana
Brown and Foley Judges concur.
MEMORANDUM DECISION
Riley, Judge.
STATEMENT OF THE CASE
[¶1] Appellant-Plaintiff, Chandan Saha (Saha), appeals the small claims court's Order, offsetting Saha's claim for past due rent and late fees and entering judgment in favor of Appellee-Defendant, Daniel Ebben (Ebben), in the amount of $4,504.90 for damages and attorney fees.
[¶2] We affirm and remand with instructions.
ISSUES
[¶3] Saha presents this court with three issues on appeal, which we restate as:
(1) Whether the small claims court abused its discretion when it determined that Saha had notice of Ebben's mailing address through Ebben's attorney for purposes of providing notice of damages under Indiana Code section 32-31-3 et seq.;
(2) Whether the small claims court erred in determining that Saha had failed to maintain the leased premises in good and safe working condition; and
(3) Whether the small claims court abused its discretion when in its award of damages and other appropriate remedies, authorized pursuant to Indiana Code section 32-31-8-6(d)(3), the court offset Saha's damages with Ebben's damages.
[¶4] Ebben presents this court with one issue on appeal, which we restate as: Whether Ebben is entitled to appellate attorney fees pursuant to Indiana Code sections 32-31-3-12(b) and 32-31-8-6(d)(1)(B).
FACTS AND PROCEDURAL HISTORY
[¶5] On August 4, 2022, Saha and Ebben, a disabled army veteran, entered into a lease agreement whereby Saha, as the landlord, leased a residence at 745 East 110th Street in Indianapolis (Premises) through August 4, 2023, to Ebben for a monthly rent of $1,050. Immediately upon taking possession, Ebben noticed issues with the Premises: the unit was not entirely clean and had "dead bugs and food both on the floors and the wall," the windows above the sink were broken, there was no hot water or potable water, and the stove did not work. (Transcript p. 36). The water provided at the Premises was undrinkable and smelled of sewage. Ebben's service dog would refuse to drink the water. Despite the stove being replaced, Ebben's home health aid was still unable to prepare meals because the replacement stove would not heat sufficiently. Although Ebben raised his concerns with the Premises frequently throughout his tenancy, Saha did not fix the problems with the water and at times the "water situation got so bad that [Ebben] had to go to a hotel." (Tr. p. 45). Eventually, in June of 2023, Ebben had the water tested and the test revealed that there was E. coli bacteria in Ebben's drinking water. As a result of the water quality and the malfunctioning stove during Ebben's tenancy, Ebben developed an H. pylori infection.
Although the Premises had an "Indianapolis address," the small claims court determined jurisdiction to be in Hamilton County. (Tr. pp. 4, 20).
[¶6] On June 30, 2023, Saha filed a notice of claim in the small claims court to evict Ebben from the Premises. On July 19, 2023, Ebben's counsel filed his appearance, together with an answer, affirmative defenses, and counterclaim related to Saha's breach of the lease. On July 20, 2023, the small claims court conducted a possession hearing and allowed Ebben to stay in the Premises until the end of the lease's term, i.e., August 4, 2023. A status hearing on August 10, 2023, confirmed that Ebben had vacated and surrendered the Premises to Saha on August 4, 2023.
[¶7] On September 21, 2023, the small claims court conducted a damages hearing. At the hearing, Saha requested the court to award him back rent of $2,450.00, late fees of $785.00, and damages of $3,250.00, for a combined total of $6,485.00. With a credit for the security deposit, Saha requested to be awarded damages in the total amount of $5,435.00. On October 25, 2023, the small claims court entered its Order, providing, in pertinent part, that
The [c]ourt finds [Saha] did not comply with the provisions of I.C. [§] 32-31-3-12. As a result, [Saha] has forfeited all claims for physical damages to the premises, must refund the $1,050 damage deposit and is subject to statutory attorney's fees incurred by the tenant for that issue. Even if this statute didn't apply, the [c]ourt did not find [Saha] documented his expenses and payments for damages in a manner that would allow the [c]ourt to award him physical damages.
The [c]ourt finds the landlord breached the covenant of quiet enjoyment by failing to maintain the rental unit in good and
proper order. Despite certain efforts, the problems in this rental unit were never fully resolved, despite more than adequate time given to the landlord to do so, and jeopardized [Ebben's] health, his ability to shower, his ability to maintain proper hygiene, and his ability to cook food. After weighing the evidence and judging the credibility of the parties' testimony, the [c]ourt finds that [Ebben] has met his burden of proof that the landlord violated the landlord's duties set out in I.C. [§] 32-31-8-5. As a result, [Ebben] may recover his actual and consequential damages as follows:
1. $696.69 in hotel expenses
2. $384 plumbing and water testing expenses
3. $326.71 in bottled water
4. $1,050 in refunded security deposit for the violation of I.C. [§] 32-31-3-12.
Additionally, due to the landlord's breach, the [c]ourt provides a damages credit to [Ebben] in the amount of rent sought by [Saha] for the months June, July, and ten days in August plus late fees. This damages credit to [Ebben], for the violation of I.C. [§] 3231-3-5 &6, offsets [Saha's] sole surviving rent and late fees damages claim.
Both I.C. [§] 32-31-3-12 and I.C. [§] 32-31-8-6 authorize an award of attorney fees to [Ebben]. The [c]ourt finds the hourly rate set out in Ex. I to be a reasonable rate for an attorney of Mr. Schrage's consumer and creditor litigation experience in the Hamilton County area. [] [Ebben] is awarded $2,047.50 in total attorney fees.(Appellant's App. Vol. II, pp. 3, 5-7).
[¶8] Saha now appeals. Additional facts will be provided if necessary.
DISCUSSION AND DECISION
I. Standard of Review
[¶9] Judgments rendered by a small claims court are subject to review as prescribed by relevant Indiana rules and statutes. N. Ind. Pub. Serv. Co. v. Josh's Lawn & Snow, LLC, 130 N.E.3d 1191, 1193 (Ind.Ct.App. 2019). The Indiana Trial Rules apply to small claims proceedings to the extent that they do not conflict with the small claims court rules. Id. Pursuant to Trial Rule 52(A), the findings or judgments rendered by a small claims court are upheld unless they are clearly erroneous. Id. Because small claims courts were designed to dispense justice efficiently by applying substantive law in an informal setting, this deferential standard of review is particularly appropriate. Id. We consider the evidence most favorable to the judgment and all reasonable inferences to be drawn from that evidence. Id. However, we still review issues of substantive law de novo. Id. The burdens of proof are the same in a small claims suit as they would have been if suit had been filed in a trial court of general jurisdiction. Id.
II. Notice of Damages
[¶10] Relying on the Security Deposit Statute, Saha contends that he was not required to provide Ebben with a notice of damages and corresponding amounts because Ebben neglected to supply him in writing with a mailing address to deliver the notice. See I.C. § 32-31-3-12(a). Therefore, in absence of a written forwarding address, Saha maintains that the small claims court erred by denying his damages and mandating the return of the security deposit.
[¶11] Our supreme court has held that "[a] security deposit remains the property of the tenant." Lae v. Householder, 789 N.E.2d 481, 483 (Ind. 2003). The Security Deposit statute specifically provides, in part, that:
(a) Upon termination of a rental agreement, a landlord shall return to the tenant the security deposit minus any amount applied to:
(1) the payment of accrued rent;
(2) the amount of damages that the landlord has suffered or will reasonably suffer by reason of the tenant's noncompliance with law or the rental agreement; and
(3) unpaid utility or sewer charges that the tenant is obligated to pay under the rental agreement;
all as itemized by the landlord with the amount due in a written notice that is delivered to the tenant not more than forty-five (45) days after termination of the rental agreement and delivery of possession. The landlord is not liable under this chapter until the tenant supplies the landlord in writing with a mailing address to which to deliver the notice and amount prescribed by this subsection. Unless otherwise agreed, a tenant is not entitled to apply a security deposit to rent.
(b) If a landlord fails to comply with subsection (a), a tenant may recover all of the security deposit due the tenant and reasonable attorney's fees.I.C. § 32-31-3-12. As pointed out by the small claims court, Ebben was represented by counsel of record during the entire forty-five-day time period under the statute, and Saha could have provided notice to Ebben's counsel, whose address had been provided to him. See Washmuth v. Wiles, 12 N.E.3d 938, 941 (Ind.Ct.App. 2014) (providing the landlords with the address of the tenants' attorney was sufficient to trigger the landlords' duty to send the notice.).
[¶12] Ebben's counsel filed his appearance on July 19, 2023. The record established that Ebben vacated the Premises as agreed by August 4, 2023, resulting in the forty-five-day time period for purposes of the damages notice under the Security Deposit Act to expire on September 18, 2023. At no point during this period did Saha provide a notice of damages to Ebben or Ebben's counsel. Therefore, as Saha did not provide Ebben with a statutorily required damages notice, he was not entitled to withhold Ebben's security deposit.
III. Condition of the Premises
[¶13] Focusing on his self-serving testimony that he "diligently worked on and ultimately did repair the water and electric stove problems reported by Ebben" and that he "was extremely courteous and prompt to deal with problems and otherwise maintain the [Premises]," Saha contends that the small claims court erred by concluding that he failed to maintain the Premises in good and safe working condition. (Appellant's Br. p. 7).
[¶14] The record reveals that upon moving into the Premises, Ebben was confronted with a residence which was dirty, had questionable water quality, and a nonfunctioning stove. Throughout Ebben's tenancy and despite his constant complaints, Saha failed to correct these problems. Hot water was lacking, forcing Ebben to shower in hotels, and tests of the water quality ultimately revealed that the water contained E. coli bacteria, which resulted in serious health problems for Ebben. Although Saha did replace the stove, the replacement stove was inadequate as the stove could not get hot enough to safely prepare food. The small claims court received the testimony of the parties, weighed the evidence presented to it, and determined that Saha had failed to maintain the Premises in a safe and working condition. Saha's argument on appeal merely amounts to a request to reweigh the evidence, which we decline to do. See N. Ind. Pub. Serv. Co., 130 N.E.3d at 1193.
IV. Offsetting Damages
[¶15] Next, Saha contends that the small claims court violated Indiana Code sections 32-31-8-5 &-6 by allowing Ebben to waive payment of past due rent and late fees.
[¶16] We already determined that Saha violated Indiana Code section 32-31-8-5 by failing to maintain the Premises "in a safe, clean, and habitable condition," "comply with all health and housing codes," and "[m]ake all reasonable efforts to keep common areas of a rental premises in a clean and proper condition." Indiana Code section 32-31-8-6(d)(3) provides that Ebben may obtain, if appropriate under the circumstances, actual and consequential damages, attorney fees and court costs, and "any other remedy appropriate under the circumstances." In calculating Ebben's damages and taking into account that Ebben had accrued unpaid rent, the small claims court provided "a damages credit to [Ebben] in the amount of rent sought by [Saha] for the months June, July, and ten days in August plus late fees. This damages credit to [Ebben], for the violation of I.C. [§] 32-31-3-5 &6, offsets [Saha's] sole surviving rent and late fees damages claim." (Appellant's App. Vol. II, p. 11). Accordingly, the small claims court determined it "appropriate" to offset Saha's damages with Ebben's damages, which reduced Saha's damages to nothing. As the small claims court continued to hold Ebben responsible for the rent due and late fees but offset this amount with the damages owed to Ebben by Saha under Indiana Code section 32-31-8-6(d)(3), we conclude that the small claims court did not waive Ebben's rent obligation and did not violate its discretion in awarding damages.
V. Appellate Attorney Fees
[¶17] Indiana adheres to the "American Rule" with respect to the payment of attorney's fees, which requires each party to pay his or her own attorney fees absent an agreement between the parties, statutory authority, or rule to the contrary. Fackler v. Powell, 891 N.E.2d 1091, 1098 (Ind.Ct.App. 2008), trans. denied. After being awarded reasonable attorney fees by the trial court-which are uncontested by Saha on appeal-Ebben relies on two statutory provisions to request an award of appellate attorney fees.
[¶18] Pursuant to section 12 of the Security Deposit Act, "[i]f a landlord fails to comply with the [Security Deposit Act], a tenant may recover . . . reasonable attorney's fees." I.C. § 32-31-3-12(b). Under Indiana Code section 32-31-8-6(d)(1)(B), "[i]f a tenant is the prevailing party in an action [to enforce an obligation of a landlord under Indiana Code section 32-31-8-5], the tenant may obtain . . . [r]ecovery of . . . [a]ttorney fees." Because we affirm the trial court's determination that Saha violated both the Security Deposit Act and his obligations under Indiana Code section 32-31-8-6, we award appellate attorney fees and remand to the trial court for determination of reasonable attorney fees as a result of this appeal.
CONCLUSION
[¶19] Based on the foregoing, we affirm the small claims court's determination that Saha had notice of Ebben's mailing address, the small claims court damage award in favor of Ebben, and its determination that Saha failed to maintain the leased premises in good and safe working condition. We award reasonable appellate attorney fees and remand to the small claims court to determine this award.
[¶20] Affirmed and remanded with instructions.
[¶21] Brown, J. and Foley, J. concur