Opinion
No. 6-071 / 05-0328
Filed March 29, 2006
Appeal from the Iowa District Court for Pottawattamie County, James S. Heckerman, Judge.
Defendant tenants were granted discretionary review of a district court appeal decision that affirmed a judgment in favor of plaintiff landlords in the landlords' forcible entry and detainer action. REVERSED AND REMANDED.
Michael Tulis of Iowa Legal Aid, Council Bluffs, for appellants.
Robert Rodenburg, Council Bluffs, for appellees.
Heard by Zimmer, P.J., and Miller and Hecht, JJ.
Defendant tenants Dayson Brown and Charrey Johnson were granted discretionary review of a district court appeal decision that affirmed a judgment in favor of plaintiff landlords Wayne and Kathy Goff in the Goffs' forcible entry and detainer (FED) action. We reverse the district court and remand for further proceedings not inconsistent with this opinion.
I. Background Facts and Proceedings.
During all times relevant to these proceedings, Brown and Johnson were receiving federally subsidized tenant-based assistance. In 2002 Brown and Johnson entered into an agreement with the Goffs to lease property located at 1808 South 10th Street, Council Bluffs. They signed both a "Lease for Voucher Tenancy" (voucher lease) and a separate month-to-month lease. In 2004 the parties agreed that, after expiration of the current voucher lease, Brown and Johnson would move to another property owned by the Goffs, located at 3505 Avenue C. The Goffs informed the defendants that they would again be required to sign both a voucher lease and an additional month-to-month lease.
In November 2004 Johnson and Kathy Goff entered into a new voucher lease for the property at 3505 Avenue C. The voucher lease, a form document consisting of three parts, was signed by Johnson on November 1 and by Goff on November 3. "Part A of Lease: Contract Information" identified the parties and the unit rented, listed all allowable household members, provided for a one-year initial lease term with an automatic renewal provision, stated an agreed amount of monthly rent, and assigned responsibility for utilities and appliances. "Part B of Lease: Tenancy Addendum," included "lease language required by HUD" that addressed a number of issues, including responsibility for maintenance, utilities, and other services; grounds for termination of the tenancy by the owner; and the fact that the terms of the addendum controlled over conflicting provisions or terms agreed to by the tenant and the owner. "Part C" allowed for the incorporation of "additional provisions (as required by the owner)" and instructed the owner to "[s]pecify any additional provisions e.g., by designating any exhibits or attachments to the lease." "Part C" was left blank, and no documents were attached to the voucher lease.
United States Department of Housing and Urban Development.
The Goffs also requested that Johnson sign a month-to-month rental agreement with several new terms, including late fee, security deposit, and renters' rules provisions. After Johnson failed to keep a November 4 appointment to sign the additional lease, the Goffs served a three-day notice of delinquent rent and termination. The notice stated Johnson and Brown's November 2004 rental payment was delinquent and gave them three days to cure the default by paying the past-due rent and a late fee. The notice also stated, "Termination of Tenancy. The tenants failure to accept the owners' offer of a new lease or revision."
The defendants timely paid the amounts demanded. No further notices were sent to the defendants at any time prior to November 10, the date the Goffs filed an FED action. The stated basis for the FED action was that "[Johnson] will not sign a rental agreement."
Following trial, a magistrate entered a judgment in favor of the Goffs for possession of the property. Brown and Johnson appealed, asserting (1) the voucher lease was a rental agreement under Iowa law, which the Goffs "failed to properly terminate under Iowa Code chapter 562A prior to filing their forcible entry and detainer action," (2) their failure to sign the additional month-to-month lease "was not `good cause' under federal law for termination of their Section 8 lease agreement," and (3) the Goffs failed to file a notice to quit on Brown and Johnson, as required by Iowa Code section 648.3.
On appeal, the district court affirmed the eviction. The court held the voucher lease was not a rental agreement under Iowa law, but merely a "contract with section 8, a third party, . . . [which] presupposes the prior existence of a separate lease between a landlord and tenant. . . ." Accordingly, the court concluded Iowa's statutory notice provisions were inapplicable.
The defendants filed an application for discretionary review, which was granted by our supreme court. On appeal, the defendants claim the voucher lease meets the legal requirement for a rental agreement under Iowa and federal law, the termination of the lease was without good cause under federal law, and the Goffs failed to provide notice prerequisites for an FED action. The Goffs maintain the case is moot because the defendants cannot be returned to the premises and do not have any other substantial right affected by the outcome of this case. However, they offer no argument regarding the merits of the appeal.
II. Scope of Review.
Forcible entry and detainer actions are tried in equity. See Iowa Code § 648.5 (2003). As such, our scope of review is de novo. Iowa Rs. App. P. 6.4, 6.203; Sunset Mobile Home Park v. Parsons, 324 N.W.2d 452, 454 (Iowa 1982). The interpretation of statutes is reviewed for the correction of errors at law. State v. McCoy, 618 N.W.2d 324, 325 (Iowa 2000).
III. Discussion.
A. Mootness.
Before we can reach the merits of the appeal, we must address the Goffs' contention that this matter is moot. "`An issue is moot if it no longer presents a justiciable controversy because it is has become academic or nonexistent.' The test is whether the court's opinion would be of force or effect in the underlying controversy." In re D.C.V., 569 N.W.2d 489, 494 (Iowa 1997) (citations omitted). The Goffs contend a decision by this court would have no force or effect in the FED action because, even if a lease existed, it has long since expired.
We might agree, were it not for the fact the defendants in this case were receiving tenant-based housing assistance from the federal government. Under 24 C.F.R. § 982.552(c)(1)(ii), their eviction grants the local public housing authority (PHA) discretionary authority to terminate their assistance. Thus, the controversy before the district court implicated more than the Goffs' bare right of possession to the leased premises. Under the circumstances, we cannot conclude the validity of the FED ruling is "a mere abstraction"; rather it involves "real, present questions, involving actual interests and rights of the parties. . . ." Manning v. Heath, 206 Iowa 952, 954, 221 N.W. 560, 561 (1928) (citations omitted). We therefore turn to the merits of the appeal.
B. Voucher Lease.
The crux of the district court's decision is its conclusion that the voucher lease is not in fact a lease, but merely a contract with HUD or the local PHA that contemplates a further lease between the landlord and tenant. This conclusion was not supported by reference to any law, and appears to be based on the following trial testimony from Johnson: "I didn't know that [I had to sign the additional lease] until I talked to Section 8 and they told me they could require a lease." After reviewing the relevant statutory provisions, we conclude the voucher lease is a valid lease agreement under both Iowa and federal law.
1. Iowa Code Chapter 562A.
Iowahas a relatively broad definition of a rental agreement, as "an agreement written or oral, and a valid rule, adopted [by the landlord] under section 562A.18, embodying the terms and conditions concerning the use and occupancy of a dwelling unit and premises." Iowa Code § 562A.6(10); see also id. § 562A.18 (setting forth criteria for rules adopted by the landlord "concerning the tenant's use and occupancy of the premises"). "The landlord and tenant may include in a rental agreement, terms and conditions not prohibited by . . . chapter [562A] or other rule of law including rent, term of the agreement, and other provisions governing the rights and obligations of the parties." Id. § 562A.9. A written document such as we have here, which is signed by the lessor and lessee and identifies pertinent terms and conditions — including identity of the leased premises, amount of rent, the lease term, renewal provisions, allowable household members, and responsibility for utilities and appliances — is more than adequate to meet the foregoing requirements. The voucher lease satisfies the definition of a lease agreement under Iowa law.
2. Federal Regulations.
The federal regulations pertinent to tenant-based assistance define a lease as
a written agreement between an owner and a tenant for the leasing of a dwelling unit to the tenant. The lease establishes the conditions for occupancy of the dwelling unit by a family with housing assistance payments under a HAP contract between the owner and the PHA.
A housing assistance payment (HAP) contract governs the terms and conditions of the monthly housing assistance payment the owner receives from the local PHA.
24 C.F.R. § 982.4. The lease must include the HUD tenancy addendum. Id. § 982.308(b)(2).
The voucher lease similarly defines the term "Lease" as "[t]he written agreement between the owner and the tenant for the lease of the contract unit to the tenant. The lease includes the tenancy addendum prescribed by HUD."
The lease must also specify:
(1) The names of the owner and the tenant;
(2) The unit rented (address, apartment number, and any other information needed to identify the contract unit);
(3) The term of the lease (initial term and any provisions for renewal);
(4) The amount of the monthly rent to owner; and
(5) A specification of what utilities and appliances are to be supplied by the owner, and what utilities and appliances are to be supplied by the family.
Id. § 982.308(d).
The voucher lease entered into between Johnson and Kathy Goff meets all the foregoing requirements. Moreover, we find no basis, in either the terms of the voucher lease or the federal regulations, for the district court's conclusion that the voucher lease was in fact an agreement with HUD or the local PHA which contemplated the execution of an additional lease between the parties.
The only signatories to the voucher lease were Johnson and Kathy Goff, and nothing on the face of the voucher lease indicates the signature of a representative of HUD or the local PHA was required. Nor does the voucher lease require or indicate the necessity of an additional lease to be executed by the landlord and tenant. In fact, it appears the only separate written agreement contemplated by the voucher lease or the federal regulations is the HAP contract between the Goffs and the PHA, and it is clear the voucher lease is not an HAP contract. See id. § 982.451. Moreover, we find nothing in the federal regulations that indicates the requirement of a separate written agreement between tenants and HUD or the local PHA. See id. §§ 982.201-.207, .302, .305 (setting forth procedure for obtaining tenant-based assistance). We conclude the voucher lease signed by Johnson and Kathy Goff constitutes a valid lease under the pertinent federal regulations.
C. Good Cause for Termination.
Consistent with those federal regulations, the tenancy addendum provided that the Goffs "may only terminate the tenancy in accordance with the lease and HUD requirements," and allowed the Goffs to terminate Johnson's tenancy only for:
(1) Serious or repeated violation of the lease;
(2) Violation of Federal, State, or local law that imposes obligations on the tenant in connection with the occupancy or use of the premises;
(3) Criminal activity or alcohol abuse (as provided in paragraph c); or
(4) Other good cause (as provided in paragraph d).
See also 42 C.F.R. § 982.310(a); Horizon Homes of Davenport v. Nunn, 684 N.W.2d 221, 226-28 (Iowa 2004) (concluding federal regulations require good cause for termination of month-to-month tenancy under project-based assistance, and federal housing law preempts Iowa law in enforcement of HUD project leases).
Johnson's failure to sign the additional month-to-month lease can in no way be construed as satisfying any of the first three grounds for termination stated in the tenancy addendum. Nor can we conclude Johnson's failure to sign the additional lease constitutes "[o]ther good cause." Up to and including the time the FED action was filed, Johnson was still within the initial one-year lease term. Under both the tenancy addendum and federal regulations, during the initial lease term other good cause must be due to "something the family did or failed to do," and does not include a tenant's "failure . . . to accept [an] offer of a new lease or revision. . . ." See 42 C.F.R. § 982.301(d)(2). Thus, Johnson's failure to sign an additional lease setting forth additional terms and conditions of her tenancy, after the execution of the voucher lease, cannot constitute good cause for termination.
IV. Conclusion.
Johnson and the Goffs entered into a valid lease agreement. Accordingly, the Goffs could not terminate Johnson's tenancy absent qualifying lease or legal violations, or good cause. See id. § 982.310; Horizon Homes, 684 N.W.2d at 226-28. Because no such grounds existed, the judgment in their favor must be reversed. We remand this matter to the district court for further proceedings not inconsistent with this opinion.