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Cohn v. Hinger

A-2632-10T2 (N.J. Super. App. Div. 2011) (Unpublished)

LANDLORD-TENANT; HABITABILITY — If a residential tenant sues to recover damages based on an alleged defect in its premises, it must first have given its landlord notice of the defect, requested correction, and gives its landlord a reasonable time to correct the defect.

Tenants rented the first floor and unfinished basement of a duplex apartment. After the apartment suffered water penetration and mold growth in the basement, the tenants moved their belongings to the first floor living space and notified their landlord. When the condition did not subside, the landlord contacted waterproofing companies to assess the situation and make any necessary repairs. The repairs took four months to complete. The landlord then decided to sell the duplex, and its buyer conducted a home inspection. It revealed the absence of GFI outlets and carbon monoxide detectors. It also described asbestos in the basement. All of these conditions were remediated by the landlord. The tenants continued to live in the unit during the repairs and remained tenants after the original landlord sold the duplex. Each month they paid the full rent.

The tenants then filed a small claims complaint against landlord for breach of the implied warranty of habitability and for breach of contract. Their complaint was based on the “massive amounts of inconvenience” they suffered as well as their exposure to unsafe conditions during their tenancy. They sought a rent abatement. The lower court disagreed and dismissed the suit. It found that the tenants had failed to show that the premises were uninhabitable and did not prove they suffered any specific damages, such as medical injuries, due to the condition of the unit.

The tenants appealed. The Appellate Division affirmed, even though the tenants argued that the lower court improperly dismissed their claims because they failed to supply evidence that they personally suffered any damages due to the property’s unsanitary condition. They argued that evidence of personal injury is not required to prove a habitability case. They also claimed that the lower court improperly took into account the fact that they paid their rent in full while negotiating a solution instead of seeking other remedies, such as vacating the unit or depositing their rent in escrow.

The Court noted that the implied warranty of habitability requires a residential unit to be occupiable without latent defects that are vital to the use of the unit for residential purposes. These typically include sufficient heat, ventilation, hot water, plumbing, and maintenance. However the defect must render the premises uninhabitable in the eyes of a reasonable person. When a tenant believes a unit is uninhabitable, it has several options: (a) vacate the premises and stop paying rent, but only if the defect is permanent and substantially interferes with the tenant’s use and enjoyment of the unit; (b) make repairs and offset the cost of repairs against the amount of the rent; or (c) sue to recover all or a portion of the rent paid. If a tenant sues under the third option, the tenant will only be responsible for the reasonable rental value of the unit in its imperfect condition. However, in order to sue, the tenant must first give the landlord notice of the defect, request that it be corrected, and allow the landlord a reasonable time to correct the defect.

In this case, the Court found that the landlord acted reasonably in remediating all of the cited conditions brought to his attention. It did not matter that the tenants believed its landlord could have completed the repairs in a shorter time frame. The Court also found that the water damage did not rise to the level of breaching the implied warranty of habitability because the loss of basement storage did not render the unit unlivable. The tenants were using the basement for laundry and storage, but it could not be argued that their primary purpose in leasing the unit was to utilize the basement for living purposes. In addition, even if they could have shown that the premises were uninhabitable, the measure of damages would have been the difference in value of the rental property before and immediately after the condition that rendered it uninhabitable. Here, the tenants offered no proof that the rental value of the unit diminished as a result of the water infiltration and other items.

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