Assanah-Carroll v. Law Offices of Maher
11m/21
Md.Jul 28, 2022Background
- Tenant Alison Assanah‑Carroll lived in a Baltimore City rental building whose city rental license lapsed from Aug. 15, 2019 to July 14, 2020; she paid rent during the lapse, stopped when she learned of it, then resumed after relicensing.
- Assanah‑Carroll filed a putative class action under the MCPA and MCDCA seeking restitution of rent paid during the unlicensed period and alleging unlawful collection efforts to recover unpaid rent for that period.
- Defendants include the landlord entities (Roizman) and the law firm retained to collect unpaid rent; collection included summary ejectment actions in District Court and a payment by Assanah‑Carroll to redeem her lease under a judgment.
- Baltimore City Code Art. 13 §5‑4(a)(2) (enacted as part of Bill 18‑0185 in 2018) prohibits charging, accepting, retaining, or seeking to collect rent unless the landlord was licensed both when offering and when providing occupancy.
- The federal district court certified two questions to the Maryland Court of Appeals: (1) whether a tenant who voluntarily paid rent to an unlicensed landlord may recover restitution under the MCPA or MCDCA without showing actual injury; and (2) whether a currently licensed landlord violates the MCDCA or MCPA by pursuing collection/ejectment for rent attributable to a prior unlicensed period where the tenant alleges no damages beyond the rent itself.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| 1. Can a tenant who voluntarily paid rent to an unlicensed Baltimore landlord recover restitution under the MCPA or MCDCA without proving actual injury? | Assanah‑Carroll: §5‑4(a)(2) manifestly forbids collection of rent by unlicensed landlords; City intended that tenants may recover such rent in private MCPA/MCDCA actions without proving separate injury. | Roizman: Existing Maryland precedent requires proof of "actual injury or loss" for private MCPA actions; City lacked authority to alter MCPA remedies by local ordinance. | No. A private MCPA (and MCDCA) plaintiff must prove actual injury or loss; §5‑4(a)(2) did not create a private restitution remedy and City cannot modify statewide MCPA remedies. |
| 2. May a landlord (licensed now) collect unpaid rent or pursue ejectment for rent attributable to a period when the landlord lacked a required rental license? | Assanah‑Carroll: Collection for an unlicensed period violates §5‑4(a)(2) and collection attempts can constitute MCDCA/MCPA violations causing damages. | Roizman: Arguments focused on statutory text and prior case law; sought to avoid broad common‑law forfeiture of rent where license later obtained. | Landlord may not recover unpaid rent attributable to an unlicensed period — either by summary ejectment or breach‑of‑contract action — unless tenant’s wrongful acts caused the loss/suspension of the license. Collections undertaken in violation may give rise to MCDCA/MCPA claims if they proximately caused damages. |
| 3. Does §5‑4(a)(2) create a private disgorgement/restitution remedy enforceable under the MCPA? | Assanah‑Carroll: The ordinance’s language shows City intended forfeiture of prohibited rent and to allow tenant restitution via private MCPA suits. | Roizman: Remedies for disgorgement/restitution under MCPA lie with the Attorney General/Consumer Protection Division (public enforcement); private MCPA remedy is limited to actual injury or loss. | No. Restitution/disgorgement is a public/enforcement remedy for the Division/AG; private plaintiffs under CL §13‑408 are limited to compensatory damages for actual injury. |
| 4. When may a tenant sue landlords/collectors under MCDCA/MCPA for collection activity tied to unlicensed periods? | Assanah‑Carroll: Collections to recover rent from the unlicensed period violate §5‑4(a)(2) and the MCDCA/MCPA; tenant need not show other damages beyond unlawful rent retention/collection. | Roizman: Collection actions should be permitted when landlord later obtains license; disputes over knowledge element of MCDCA. | If landlord engages in collection activity to recover rent attributable to an unlicensed period (and lacks a legally cognizable right to do so), such conduct can violate the MCDCA (and thus the MCPA). Tenant must still prove damages proximately caused by that unlawful collection activity. |
Key Cases Cited
- McDaniel v. Baranowski, 419 Md. 560 (2011) (applied common‑law licensing/illegality principles to bar an unlicensed landlord from invoking summary ejectment to collect rent; required landlord to be licensed when filing)
- CitaraManis v. Hallowell, 328 Md. 142 (1992) (private MCPA actions require proof of actual injury or loss; lack of licensure alone does not entitle tenants to restitution)
- Golt v. Phillips, 308 Md. 1 (1986) (rental of unlicensed, uninhabitable premises violates MCPA; tenant recovered compensatory damages where actual injury shown)
- Linton v. Consumer Protection Division, 467 Md. 502 (2020) (distinguished private compensatory remedies from public restitution/disgorgement remedies available to the AG/Division under MCPA)
- Consumer Protection v. Consumer Publishing Co., 304 Md. 731 (1985) (government consumer‑protection enforcement may seek restitution without direct proof of reliance; contrasted restitution/disgorgement with private damages)
- Harry Berenter, Inc. v. Berman, 258 Md. 290 (1970) (unlicensed contractor cannot enforce contractual remedies where statute is regulatory to protect the public)
- Goldsmith v. Manufacturers’ Liability Ins. Co., 132 Md. 283 (1918) (unlicensed insurance brokers barred from recovery when licensure requirement protects public)
- Snodgrass v. Immler, 232 Md. 416 (1963) (unlicensed architect could not recover fees where licensure requirement served public protection)
- Smirlock v. Potomac Development Corp., 235 Md. 195 (1964) (unlicensed real estate broker could not recover commission where licensing requirement had regulatory purpose)