477 P.3d 14
Or. Ct. App.2020Background
- Tenant texted landlord during application claiming $76,000 income in 2016 and that she had never been evicted; landlord had limited screening time but contacted a prior landlord.
- Parties executed a one-year lease in April 2018; tenant paid part of rent directly and part via subsidy.
- Tenant failed to pay her share for August and September 2018; landlord served a 72-hour termination notice (served 9/11/2018) and later filed a forcible entry and detainer (FED) action for nonpayment.
- Tenant asserted tender (offered payment via third parties), counterclaimed for unlawful entries, and paid $846 into court under ORS 90.370 to preserve possession.
- Trial court found tenant had misrepresented rental and income history, concluded she breached the ORLTA duty of good faith, disregarded her defenses and ORLTA rights, returned her court payment, and granted possession to landlord.
- On appeal, the court held that a misrepresentation in the application was not a duty or condition precedent under ORS 90.130 to bar tenant from asserting tender or using ORS 90.370; it reversed and remanded.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a tenant's misrepresentation on a rental application can bar assertion of defenses and ORLTA remedies (eg, tender, paying rent into court under ORS 90.370) | Lopez: ORLTA does not condition those defenses/rights on truthful application statements; only certain statutory misrepresentations (eg, criminal conviction) are actionable | Kilbourne: ORS 90.130 duty of good faith forbids invoking ORLTA remedies if tenant acted in bad faith during application | Reversed — the duty of good faith applies only to duties or acts that are conditions precedent under ORLTA; application misstatements here were not such a condition, so they did not bar defenses or ORS 90.370 rights |
| Whether the trial court properly rejected tenant's tender-of-rent defense on the merits | Lopez: court wrongly ignored the tender defense and should have adjudicated the factual dispute about offers of payment | Kilbourne: payments were partial and/or from third parties and landlord was not required to accept them | Remanded — appellate court did not decide the merits; trial court erred by not reaching them because it applied an improper good-faith bar |
| Whether tenant's counterclaims were brought in bad faith, affecting the withholding remedy | Lopez: counterclaims were brought in good faith; paying into court preserved possession | Kilbourne: argued bad faith to negate ORS 90.370 protection | Held: trial court made no finding of bad faith on counterclaims; because tenant paid more than owed into court, she should not have been evicted without those findings |
Key Cases Cited
- Stonebrook Hillsboro, L.L.C. v. Flavel, 187 Or App 641 (Or. Ct. App. 2003) (tenant bad faith can bar enforcement of a statutory notice when the bad-faith act is the same act tied to the right)
- Napolski v. Champney, 295 Or 408 (Or. 1983) (withholding remedy: tenant may pay rent into court when asserting counterclaims; counterclaims must be in good faith)
- Eddy v. Anderson, 366 Or 176 (Or. 2020) (ORLTA good-faith standard is subjective UCC-derived honesty in fact)
- Amatisto v. Paz, 82 Or App 341 (Or. Ct. App. 1986) (tenant who pays sufficient rent into court retains possession even if counterclaims fail)