Oldendick v. Crocker
70 N.E.3d 1033
Ohio Ct. App.2016Background
- Plaintiff Elisabeth Oldendick and co-lessee signed a one-year lease for a Cleveland Heights apartment on Sept. 10, 2013, and paid $1,720 (first month’s rent + $860 security deposit). They never took possession.
- On Sept. 13, 2013 Oldendick repudiated the lease; she later leased a different apartment with an earlier commencement date and lower rent.
- Landlord (Winslow Crocker, doing business as Urban Restoration Project) re-advertised and re-rented the unit; new lease began Nov. 1, 2013. Landlord deducted an $860 early-termination fee from Oldendick’s deposit and kept the $1,720 total.
- Oldendick sued to recover the $1,720, statutory double damages under R.C. 5321.16(C), and attorney fees; appellees counterclaimed for breach. Trial court ruled for appellees and allowed retention of the funds.
- Court of Appeals reversed in part: held the early-termination clause operated as an unenforceable penalty for purposes of deducting from the security deposit, calculated landlord’s actual recoverable damages, and awarded Oldendick double the portion wrongfully withheld under R.C. 5321.16(C).
Issues
| Issue | Plaintiff's Argument (Oldendick) | Defendant's Argument (Crocker) | Held |
|---|---|---|---|
| Enforceability of lease / unconscionable clauses | Lease contained unconscionable/self-help/attorney-fee provisions making it unenforceable | Lease clauses standard and not enforced; entire lease valid | Court declined to void entire lease; no relief based on unused "self-help" clauses because they were not exercised |
| Early-termination clause — deductibility from security deposit under R.C. 5321.16(B) | Clause functions as a penalty/liquidated damages and is inconsistent with R.C. 5321.16(B); cannot be withheld from deposit | Clause is a contractual liquidated-damages term and enforceable; landlord entitled to deduct it as damages | Clause operated as a penalty on these facts and was not a proper deduction from the security deposit under R.C. 5321.16(B) |
| Measure and amount of landlord’s recoverable actual damages after breach | Only minimal re-rental commission (at most $100) was recoverable; landlord did not suffer lost rent because new tenant paid similar rent | Landlord suffered $550 lost rent (difference) + $220 re-rental expenses = $770 | Court found $220 re-rental expense recoverable but rejected $550 lost-rent amount (pet fee accounted for difference); actual damages = $220 |
| Statutory double damages and attorney fees under R.C. 5321.16(C) | Because the early-termination fee was wrongfully withheld from deposit, Oldendick is entitled to double damages on the wrongfully withheld portion plus reasonable fees | Landlord not liable because deduction was lawful under the lease | Where a landlord wrongfully withholds part of a deposit, tenant recovers double damages only for the amount wrongfully withheld; here plaintiff recovers $640 x 2 = $1,280 plus attorney fees related to deposit claim |
Key Cases Cited
- Taylor Bldg. Corp. of Am. v. Benfield, 117 Ohio St.3d 352 (contract unconscionability standard and de novo review)
- Vardeman v. Llewellyn, 17 Ohio St.3d 24 (interpretation and purpose of R.C. 5321.16(B) and (C))
- Smith v. Padgett, 32 Ohio St.3d 344 (no bad-faith requirement for double damages under R.C. 5321.16(C))
- Lake Ridge Academy v. Carney, 66 Ohio St.3d 376 (liquidated-damages/penalty analysis principles)
- Samson Sales, Inc. v. Honeywell, 12 Ohio St.3d 27 (test for distinguishing liquidated damages from penalties)
- Riding Club Apartments v. Sargent, 2 Ohio App.3d 146 (liquidated-damages clause inconsistent with R.C. 5321.16(B) — unenforceable)
- Albreqt v. Chen, 17 Ohio App.3d 79 (same; landlord must itemize actual damages under R.C. 5321.16(B))