Summary
In Blackwell, the Colorado Supreme Court acknowledged the harshness of applying caveat emptor principles to modern lease relationships but also concluded that the General Assembly, rather than the courts, was the more appropriate body to consider the propriety of abolishing caveat emptor in favor of an implied warranty of habitability.
Summary of this case from Anderson v. Shorter Arms Inv'rsOpinion
No. C-728
Decided August 3, 1976.
Action by tenant against landlord seeking to recover rents paid, and also seeking damages for alleged infliction of intentional emotional distress caused by landlord's "outrageous conduct." The district court dismissed the complaint. The court of appeals, 35 Colo. App. 399, 536 P.2d 838, affirmed, and certiorari was granted.
Affirmed
1. LANDLORD AND TENANT — Implied Warranty of Habitability — Negative. There is no implied warranty of habitability as a consequence of a landlord-tenant relationship with respect to residential premises.
Certiorari to the Colorado Court of Appeals
Michael J. Wood, for petitioner.
Robert W. LaBree, P.C., for respondent.
Michael Gilbert, Jon S. Nichols, for amici curiae Legal Aid Society of Metropolitan Denver, Inc.
Jonathan D. Asher, for amici curiae Colorado Rural Legal Services, Inc.
This case presents the question of whether in Colorado an implied warranty of habitability arises as a consequence of the landlord-tenant relationship. The court of appeals, in affirming the trial court's ruling, held that such a warranty does not exist, Blackwell v. Del Bosco, 35 Colo. App. 399, 536 P.2d 838. We granted certiorari to review this determination and we now affirm.
I.
In March 1971, respondent purchased an existing car dealership and the tract of land on which it was located, on South Weber Street, in Colorado Springs. Among the improvements was a run-down one-bedroom house, which was occupied by petitioner who had been paying a monthly rental of sixty-five dollars to the previous owner. Petitioner was a widow approaching sixty years of age, whose monthly income totalled $123. Respondent permitted petitioner to continue the month-to-month tenancy at the same monthly rental. Petitioner remained in possession until November 1973.
Respondent testified that he intended to eventually tear the house down in order to expand his used car lot. He advised petitioner of his intentions and told her that he hoped she could find another place to live. He also told her that he did not intend to make any repairs. However, he allowed petitioner to continue occupancy for over two years, and on occasion he or his agents attempted minor repairs.
The record establishes, and respondent concedes, that the house in question was in wretched condition. A municipal building inspector who inspected it in September 1973 characterized it as unfit for human habitation. The building inspector gave respondent sixty days to correct the deficiencies and informed him that if the corrections were not remedied within this period occupancy of the dwelling would become unlawful.
In August 1973, petitioner commenced to withhold rent payments because of respondent's refusal to make certain repairs which she alleged he had promised. Rather than repair the house to bring it up to the minimal level required for compliance with the housing code, which it was estimated would cost thousands of dollars, respondent brought, on November 5, 1973, a forcible entry and detainer (FED) action in the El Paso County court against petitioner, demanding return of the premises and payment of the rent withheld. This action was later transferred to the district court.
On November 13, 1973, petitioner filed an action in the El Paso County district court, seeking in the first claim to recover rents paid during the tenancy, in the sum of $1,885, and in the second claim damages of $5,000 for the alleged infliction of intentional emotional distress caused by respondent's "outrageous conduct."
Respondent's FED action was heard on November 20, 1973, at the conclusion of which petitioner was ordered to vacate the premises. No appeal was taken from that ruling.
Trial of petitioner's claims was to a jury, and commenced on May 7, 1974. At the conclusion of petitioner's case, the court granted respondent's motion to dismiss both claims for relief. The court found that the landlord had not expressly or impliedly warranted the dwelling to be habitable and that the tenant had not given proper notification of such defects as did exist. The record supports these findings. The court of appeals affirmed the trial court's rulings. Petitioner does not, on certiorari, seek review of the court of appeals' affirmance of the dismissal of the second claim relating to the alleged intentional infliction of emotional distress.
II.
[1] Under the common law rule, which evolved from an agrarian society in medieval England, all leases were subject to the doctrine of caveat emptor. A lessor by merely leasing did not covenant or warrant that the premises were tenantable or fit for the lessee's intended use. Thus, in the absence of an express warranty or of fraud or misrepresentation, the lessee took the premises in the condition he found them, with all existing defects of which he knew or could have ascertained upon reasonable inspection. Quinn Phillips, The Law of Landlord-Tenant: A Critical Evaluation of the Past With Guidelines for the Future, 38 Fordham L. Rev. 225 (1969); 49 Am. Jur. 2d Landlord and Tenant § 768. "Fraud apart," it was said, "there is no law against letting a tumbledown house. * * *" Robbins v. Jones, 15 C.B. (N.S.) 221, 143 Eng. Rep. 768 (1863).
This court has basically adhered to the common law rule with respect to leases of both a business and a residential nature. In Davis v. Marr, 160 Colo. 27, 413 P.2d 707, it was stated:
"Generally, when a prospective tenant has had an opportunity to inspect the condition of the premises sought to be rented, and any defects existing thereon are patent or obvious to the tenant's observation, the law exempts the landlord from liability for injuries * * *. In the absence of the landlord's covenant to repair, the tenant is said to have assumed the risk of loss or injury when he enters into the defective premises and has had means of information equal to that of the landlord. * * *"
To the same effect is Capitol Co. v. Anheuser-Busch, 94 Colo. 372, 30 P.2d 264, where, said the court, the ordinary rule is that there is no implied warranty on the part of the lessor that the premises, as leased, are safe for occupation by the tenant.
In Spicer v. Machette, 59 Colo. 214, 147 P. 657, the court said that in a lease for a building there is no implied contract that it is well constructed, or safe, or reasonably fit for occupancy, or that it will continue in habitable condition. Absent an express agreement, if the tenant has equal information with his lessor, the lessor is not liable for losses sustained due to defective or dangerous conditions.
Consistent with the foregoing rule are also: Baughman v. Cosler, 169 Colo. 534, 459 P.2d 294; Martin v. Grant, 90 Colo. 300, 8 P.2d 764; Colorado Co. v. Giacomini, 55 Colo. 540, 136 P. 1039; Davidson v. Fischer, 11 Colo. 583, 19 P. 652; Thum v. Rhodes, 12 Colo. App. 245, 55 P. 264.
Several exceptions, however, have been established in this state to the rule of caveat emptor, see Giacomini, supra, where the property, a hotel, was leased for those purposes; see also Capitol Co. v. Anheuser-Busch, supra, where the defect was allegedly unknown to the tenant, was known to the landlord, and was not ascertainable upon ordinary inspection, and Davis v. Marr, supra, where the landlord had covenanted to repair the defect.
III.
The sometimes harshness of the common law rule, which led this and other courts to establish exceptions to it, has also led an increasing number of courts in recent years to treat the residential lease as a contract and to imply a warranty that the living unit is "habitable." Courts have recognized that tenants today are typically short-term and have neither the tools nor skills to make needed repairs, which repairs may well cost more than the average tenant can afford. Furthermore, there is often unequal bargaining power between landlord and tenant, 2 M. Friedman, Friedman on Leases § 10.101. The tenant, even if he inspects before signing a lease, may not be able to discover hidden defects.
For these reasons, a number of jurisdictions have rejected the common law doctrine of caveat emptor: Javins v. First National Realty Corporation, 138 D.C. App. 369, 428 F.2d 1071 (D.C. Cir. 1970), cert. denied, 400 U.S. 925, 91 S.Ct. 186, 27 L.Ed.2d 185; Lemle v. Breeden, 51 Hawaii 426, 462 P.2d 470, 40 A.L.R.3d 637; Mease v. Fox, 200 N.W.2d 791 (Iowa 1972); Steele v. Latimer, 214 Kan. 329, 521 P.2d 304; Boston Housing Authority v. Hemingway, 293 N.E.2d 831 (Mass. 1973); King v. Moorehead, 495 S.W.2d 65 (Mo.App. 1973); Marini v. Ireland, 56 N.J. 130, 265 A.2d 526, 40 A.L.R.2d 1356; Pines v. Perssion, 14 Wis.2d 590, 111 N.W.2d 409; see also Annot., 40 A.L.R.3d 646.
In addition to the foregoing policy reasons, the courts have been guided by the existence of housing codes and warranties implied in other areas of the law. The Javins case, supra, held that the warrant could be implied independently on the basis of a housing code, and reliance has been placed by analogy on the trend in a growing number of states to imply warranties in sales of new homes and in the Uniform Commercial Code implied warranties of merchantability and fitness for a particular purpose, see Lemle v. Breeden, supra.
This trend is exemplified by this court's decision in Carpenter v. Donohoe, 154 Colo. 78, 388 P.2d 399; see also Schipper v. Levitt Sons, Inc., 44 N.J. 70, 207 A.2d 314; Comment, 20 De Paul L. Rev. 955 (1971).
We have carefully considered the emerging warranty remedy recognized in these opinions. We have concluded that, however desirable the adoption of the rule of implied warranty of habitability might be, the resolution of this issue is more properly the function of the General Assembly. We recognize that the rule of caveat emptor was developed under social and economic conditions which no longer prevail in many areas of the United States. But the implied warranty of habitability theory involves many economic and social complexities, and we believe its adoption should be preceded by the research and study of which the legislature is more capable. Embracing the theory might, for example, cause landlords to significantly raise rents in order to make the required repairs, or induce them to abandon already run-down premises, leaving some poor people without any place, good or bad, in which to live. Indeed, in the present case, respondent preferred to evict the petitioner rather than invest great sums in repairs.
We note, further, that the courts which have adopted the implied warranty remedy have not expressed agreement on what form it is to take — by what standards breach of warranty is to be measured, whether it may be waived or disclaimed, or what measure of damages should be available to the aggrieved tenant. These considerations, the formulation of which will vastly affect the rental industry, in our view, lie within the legislative competence of the General Assembly.
For the foregoing reasons, the judgment of the court of appeals is affirmed.
MR. CHIEF JUSTICE PRINGLE dissents.