430 P.3d 1100
Or. Ct. App.2018Background
- Month-to-month tenancy for a house began Nov 2013; written lease listed landlord-owned appliances and set rent at $1,400/month with late fees.
- Tenants repeatedly paid rent late or partially, accrued substantial unpaid rent and charges; landlord eventually sued after tenants stopped paying and overstayed a stipulated move-out date.
- Tenants repeatedly reported intermittent downstairs shower drain backups; landlord cleared blockages using a provided "expander bulb" and repaired the sewer line in 2007; subsequent occupants had no drainage problems.
- After tenants vacated (no clear notice date), landlord discovered missing/damaged landlord-owned items and debris in the yard (which had already generated a city nuisance citation and fine); landlord disposed of the yard debris and repaired/replaced property.
- Tenants counterclaimed: (1) diminished rental value and personal property damage based on alleged habitability violations (drain backups), and (2) statutory relief for landlord’s alleged failure to give an abandoned-property notice before disposing of items.
- Trial court found tenants acted in bad faith to avoid paying rent, denied both counterclaims (concluding disposed items were trash/debris so no abandoned-property notice was required) and awarded landlord most of the claimed damages; appellate court affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether tenants needed to give written notice (ORS 90.365) before asserting diminished-rental-value damages under ORS 90.360(2) for plumbing/habitability defects | Landlord: tenants did not give the written notice required for essential-service remedies; their withholding of rent was improper and showed bad faith | Tenants: they proceeded under ORS 90.360(2) (no written notice required) and should be allowed damages without invoking ORS 90.365 | Court: did not decide the statutory-interpretation question; held trial-court fact finding of bad faith (tenants withheld rent to avoid payment) defeats the counterclaim regardless of which statute applies; affirmed dismissal |
| Whether landlord had to give abandoned-property notice (ORS 90.425) before disposing of items left on premises | Landlord: items were trash/debris (nuisance), not "personal property/goods" under ORS 90.425, so no notice duty | Tenants: the disposed items were personal property requiring statutory notice and relief from unpaid rent for landlord's noncompliance | Court: "personal property" in ORS 90.425 is limited by statute to enumerated items (e.g., "goods"); trash/debris typically lack value and fall under tenant duties to remove; yard items were nuisance/trash so no notice required; counterclaim denied |
Key Cases Cited
- L&M Investment Co. v. Morrison, 286 Or. 397, 594 P.2d 1238 (discussing deferential review of trial court fact findings in landlord-tenant disputes)
- Napolski v. Champney, 295 Or. 408, 667 P.2d 1013 (tenants may counterclaim for diminution of rental value; good-faith requirement under ORLTA)
- Amatisto v. Paz, 82 Or. App. 341, 728 P.2d 42 (ORLTA operates to provide rent-withholding remedy; good-faith inquiry central)
- Brewer v. Erwin, 287 Or. 435, 600 P.2d 398 (interpretation of ORLTA remedial directives)
- Commonwealth Property Management, Inc. v. Hanson, 94 Or. App. 136, 764 P.2d 950 (trial court may reject counterclaims asserted in bad faith)
- State v. Gaines, 346 Or. 160, 206 P.3d 1042 (methodology for statutory interpretation: text, context, legislative history)
- PGE v. Bureau of Labor and Industries, 317 Or. 606, 859 P.2d 1143 (use of statutory context and related provisions in interpretation)