Opinion
No. 02A03-1105-SC-200
12-07-2011
JOHN F. OTTO, JR., Appellant-Plaintiff, v. SCOTT DOUGLAS WOODHAMS, Appellee-Defendant.
ATTORNEY FOR APPELLANT : MICHAEL H. MICHMERHUIZEN Barrett & McNagny LLP Fort Wayne, Indiana
Pursuant to Ind.Appellate Rule 65(D),
this Memorandum Decision shall not be
regarded as precedent or cited before
any court except for the purpose of
establishing the defense of res judicata,
collateral estoppel, or the law of the case.
ATTORNEY FOR APPELLANT:
MICHAEL H. MICHMERHUIZEN
Barrett & McNagny LLP
Fort Wayne, Indiana
APPEAL FROM THE ALLEN SUPERIOR COURT
The Honorable Jerry L. Ummel, Magistrate
Cause No. 02D01-1012-SC-22393
MEMORANDUM DECISION - NOT FOR PUBLICATION
ROBB , Chief Judge
Case Summary and Issue
John F. Otto, Jr. appeals from the trial court's denial of his motion to correct error on the trial court's judgment on his claim against his tenant, Scott Woodhams. The sole issue is whether Otto's notice of his intent to retain Woodhams' security deposit in full or in part complied with the requirements of Indiana Code section 32-31-3-14 that a landlord mail a letter to his or her tenant providing an itemized list of damages claimed for which the tenant's security deposit is to be used. Concluding the trial court did not err in denying Otto's motion to correct error because the letter Otto sent to Woodhams was neither strictly nor substantially in compliance with the statute, we affirm.
Facts and Procedural History
On January 1, 2008, Otto, as the landlord, and Woodhams, as the tenant, entered into a written lease agreement. As part of the lease, Woodhams provided Otto with a $500 security deposit and agreed to pay $550 in rent each month. Once the original lease agreement ran its course, Woodhams continued renting Otto's property on a month-to-month basis.
On December 3, 2010, Woodhams delivered his rent check to Otto, along with a notice stating Woodhams' intent to vacate the property. On December 5, 2010, Otto sent Woodhams a letter acknowledging his receipt of the rent check and Woodhams' intent to vacate the property. Otto's letter also stated as follows:
Your [security] deposit will be remitted within 30 days of January 1, 2011. The amount will be dependent on the condition of the interior and exterior. The condition is to be as clean as it was when you entered into the original lease, less normal wear and tear. Attached is a copy of the original lease - reread if you have time.Appendix of the Appellant's Brief at A-27.
On December 8, 2010, Otto's bank notified him that a stop payment order had been placed on the check tendered to Otto by Woodhams to cover Woodhams' December 2010 rent obligation. Woodhams never cured the lack of payment for his December 2010 rent obligation.
On December 28, 2010, Otto sent a letter to Woodhams that read as follows:
Pursuant to Indiana Rules and Regulations for Landlords and Tenants: I must inform you that the condition of the rental home you occupied for 3 years . . . was in a condition that was not similar to that of December 2007, when you moved into the home.Id. at A-30. On December 16, 2010, Otto filed a Notice of Claim against Woodhams in small claims court, seeking $2,618.13 in damages. At trial, Otto testified that it took approximately sixty days to return the rental property to a condition in which it was suitable to lease to a new tenant. He further testified that the final repair costs could not be completed and itemized within forty-five days after the termination of occupancy, as required by Indiana Code section 32-31-3-14.
For that reason, your $500.00 security deposit will not be refunded in part or whole. It will be applied to the damages - carpeting, painting, dog feces, window blind replacing, ceramic tile cleaning, and replacement.
Neither the original hearing in the small claims court nor the hearing on Otto's motion to correct error was recorded, and these facts therefore come from the verified statement of evidence certified by the trial court. App. of the Appellant's Br. at A-20-23.
On March 3, 2011, the trial court entered judgment in favor of Otto in the amount of Woodhams' unpaid rent, $620, to be offset by $500, which represented the amount of Woodhams' security deposit retained by Otto, resulting in a judgment in Otto's favor in the amount of $120. The trial court concluded that Otto's December 5, 2010 and December 8, 2010 letters to Woodhams did not satisfy the requirements of Indiana Code section 32-31-314, and thus Otto was not entitled to recover for damages to the premises.
On March 18, 2011, Otto filed a motion to correct error contending the trial court's ruling was contrary to the holding in Turley v. Hyten, 772 N.E.2d 993 (Ind. 2002). On April 26, 2011, the trial court denied Otto's motion, finding the Turley decision to be distinguishable from the case at bar. Otto now appeals the trial court's denial of his motion to correct error.
Discussion and Decision
I. Otto's Motion to Correct Error
A. Standard of Review
The denial of a motion to correct error is generally reviewed for an abuse of discretion. Kornelik v. Mittal Steel USA, Inc., 952 N.E.2d 320, 324 (Ind. Ct. App. 2011). However, where the issues raised in the motion are questions of law, we employ the de novo standard of review. Id. Here, Otto's motion to correct error raised questions about the applicability of a supreme court decision to the facts of this case, and thus de novo review is the applicable standard. As such, we owe the trial court no deference, and we will substitute our judgment for that of the trial court if necessary. See City of Anderson v. Davis, 743 N.E.2d 359, 362 (Ind. Ct. App. 2001) (disapproved of on other grounds by Wilson v. Isaacs, 929 N.E.2d 200 (Ind. 2010)).
In this case, Woodhams, the appellee, did not file a brief. When an appellee fails to submit a brief, we will not undertake the burden of developing an argument on his or her behalf. Christy v. Sebo, 930 N.E.2d 1154, 1158 (Ind. Ct. App. 2010). We will, however, apply a less stringent standard of review with respect to the showing necessary to establish reversible error. Wolverine Mut. Ins. Co. v. Oliver, 933 N.E.2d 568, 570 (Ind. Ct. App. 2010), trans. denied. It is within our discretion to reverse the trial court's decision if the appellant can establish prima facie error. In re Riddle, 946 N.E.2d 61, 70 (Ind. Ct. App. 2011).
B. Sufficiency of Otto's Notice
Indiana Code section 32-31-3-14 provides:
Not more than forty-five (45) days after the termination of occupancy, a landlord shall mail to a tenant an itemized list of damages claimed for which the security deposit may be used . . . . The list must set forth:
(1) the estimated cost of repair for each damaged item; and
(2) the amounts and lease on which the landlord intends to assess the tenant.
Otto urges us to take the position that the letter he sent Woodhams dated December 28, 2010 complies with the relevant statute, and that he justifiably withheld Woodhams' security deposit as a result. This court has taken a strict compliance approach to the notice statute on numerous occasions, at times counting the days to ensure the landlord's letter was sent within the prescribed forty-five day period and scrutinizing the level of itemization by the landlord with great care. See e.g. Pinnacle Properties v. Saulka, 693 N.E.2d. 101, 104 (Ind. Ct. App. 1998), trans. denied; Figg v. Bryan Rental, Inc., 646 N.E.2d 69, 71 (Ind. Ct. App. 1995), trans. denied; Meyers v. Langley, 638 N.E.2d 875, 878 (Ind. Ct. App. 1994). However, in rare instances in which a landlord's letter to his or her tenant does not strictly comply with the notice statute, we have discerned that the letter nonetheless fulfilled the purpose of the statute and therefore sufficiently complied with its provisions. See Turley, 772 N.E.2d at 997.
Otto indeed points us to Turley for guidance, claiming that its facts are indistinguishable from the case at bar. In Turley, the tenant vacated the landlord's property on an unspecified date, sometime between February 1 and 3, 1996. Id. at 994 n.l. The landlord sent the tenant the following letter, dated February 25, 1996, in response to the tenant's demand for the return of his $450 security deposit:
In response to your registered letter of February 7, 1996, this is notification to you regarding expenses chargeable to you under the terms of your lease. Pictures have been taken, and the Town Marshall was invited in to see the house in the condition you left it. You left behind trash and there are many holes in the wall to be patched before it can be painted. There is also damage to the building.Id. at 996. This court held the letter failed to comply with the requirements of Indiana Code section 32-31-3-14 because, although it identified various damage items and stated the total damages exceeded $1400, the letter did not provide an estimated cost for each of the damage items. Turley v. Hyten, 751 N.E.2d 249, 252 (Ind. Ct. App. 2001).
When you called to say you were moving, you didn't tell us there was no heat in the house and all the pipes froze and burst. The damage to the carpet and floors is very bad. The toilet bowl burst, to name just a few of the problems. The house will have to be totally replumbed.
The Water Company called and said you had told them early on in the month that you were moving and they put the billing back in our name. That is why they called to tell us something might be wrong because 24,000 gallons of water had gone through leaving "a pretty large bill for [the landlord] to have to pay". Had you told us you were moving, perhaps this could have been avoided.
[Although] we don't have a complete estimate yet, the damage is already more than $1400.00. After a complete assessment is made, we will give you a full itemized statement. It will also include lost rent due to our inability to lease the house again on a timely basis.
The Indiana Supreme Court granted transfer and ultimately reversed this court's decision. The supreme court looked to this court's discussion of the statute's purpose in Meyers, in which we stated, "[t]he purpose of the notice provision is to inform the tenant that the landlord is keeping the security deposit and for what reason. It provides the tenant an opportunity to challenge the costs for which the deposit is being used." Meyers, 638 N.E.2d at 878-79.
The court stated that the statute's purpose, as articulated in Meyers, had been fulfilled in Turley. 772 N.E.2d at 997. The landlord informed the tenant of the types of damages at the property, and that due to their extensive nature, a complete estimate of the total amounts of each damage item was not yet available. Id. The court also held that the letter provided the tenant with more than enough information with which to contest the costs to which his security deposit was being applied. Id. The court noted in particular that the tenant's security deposit was $450, whereas the landlord's letter made clear that total damages had already exceeded $1400. Id. Finally, the court pointed out that the landlord's letter stated that the tenant would be held liable for lost rent due to the landlord's inability to lease the house in a timely fashion. Id. Under the lease agreement between the tenant and the landlord, one month's rent was equal to the tenant's security deposit, which gave the tenant further indication as to where his security deposit could be applied. Id.
Having reviewed the facts in Turley, specifically the security deposit letter, we find numerous facts on which to distinguish the case at bar from Turley. In Otto's letter to Woodhams, he does name specific damage items for which Woodhams' security deposit will be used, but Otto failed to provide any estimate of the costs of the damages calculated up to that point. Additionally, Otto did not state that he would provide Woodhams with the total costs of damages after a complete assessment was made.
In finding that the purpose of the notice letter had been served, the court in Turley noted that the landlord's letter gave the tenant more than enough information on which to contest the damage items. Here, Otto's letter only lists certain damage items; it does not describe the issues they caused nor does it state what remedial measures need to be taken as a result. On the contrary, the landlord's letter in Turley thoroughly explained the nature of the damages to the property and the repairs that would be undertaken as a result. Otto's letter lacked such thoroughness; for example, stating only damage items such as painting and window blind replacing. It provides no specificity as to the type of damage that led to the need to repaint or to replace window blinds.
Otto argues that the case before us is even more compelling than Turley, because here Woodhams had past due rent obligations. As a result, Otto suggests that he could have simply retained the entire security deposit for lost rent, irrespective of the damages to the property. Otto's argument is unconvincing; it ignores not only the plain language of his letter to Woodhams, but also the purpose of the security deposit statute. Otto's letter states because the property was not left in a condition similar to that in which Woodhams found it, Woodhams' security deposit would not be refunded in part or in whole. The letter makes no mention of applying the security deposit towards past due rent obligations. As previously mentioned, the purpose of the security deposit statute is to inform the tenant that the landlord is keeping the security deposit and for what reason. Meyers, 638 N.E.2d at 878-79. Thus such an argument, on its face, fails to comply with the language and purpose of the security deposit statute.
For the aforementioned reasons, Otto's letter to Woodhams generally lacks the specificity and depth of the Turley letter. As a result, we cannot excuse Otto's failure to provide Woodhams with an itemized list of damages claimed for which the security deposit may be used not more than forty-five days after the termination of Woodhams' occupancy. Woodhams may well have had past due rent obligations to which, as Otto urges us to find, the security deposit could have been applied. But Otto's failure to disclose in the letter his intention to so use Woodhams' deposit is fatal to this stance. We therefore cannot hold that the purpose of the security deposit statute has been fulfilled by Otto's letter.
Conclusion
We conclude that the trial court did not err in denying Otto's motion to correct error on the basis that the facts in the case at bar are distinguishable from those found in Turley, and Otto has therefore failed to comply with the requirements of Indiana Code section 32-31-3-14.
Affirmed. BARNES, J., and BRADFORD, J., concur.