This is an appeal from the Fourth Judicial District Court, in
and for the County of Missoula, the Honorable Jack L. Green
presiding. Appellants were all tenants of a Missoula trailer court
at one time or another. They appeal the decision of the District
Court which held that the landlords did not breach the warranty of
habitability. We reverse.
This action began in 1983 when Bill Adams and Harold Magruder
(landlords) purchased a Missoula trailer court known as the "River
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Road Trail Court. Mervin Brandvold (Brandvold) became the on-site
manager and leased mobile home spaces to numerous individuals, some
of whom are the appellants (tenants) in this action. Shortly after
purchasing the trailer court the landlords made promises to reseed
lawns and pave streets, neither of which was done. They also made
various rules for the trailer court and its residents which went
unenforced over the course of several years; the manager actually
participated in breaking the rules.
The tenants experienced various maintenance problems the most
serious to include garbage accumulation due to inadequate
collection services, septic system overflows and backups, and a
contaminated water system. The tenants complained regularly,
resulting in little or no action from the landlords or Brandvold.
In 1985, the landlords decided to build a townhouse
development on the trailer court site and submitted proposals to
that end with the appropriate authorities. To accomplish the
project, eviction of the trailer court tenants would be necessary.
2
As consideration of the townhouse development progressed, the
tenants continued to be plagued with severe problems with the water
and sewer systems as well as garbage collection and general
cleanliness of the common areas of the trailer court.
At one point a "boil order" was levied due to a contaminated
water sample test obtained by the Missoula City-County Health
Department (Health Department). It was not uncommon that raw
sewage spilled out onto the ground and sewer risers on vacant
trailer spaces had loose fitting caps or were left uncapped
completely. Little or no effort was made to clean up the spills
leaving a detestable odor throughout the trailer court,
particularly in warm weather.
Eventually, landlords withdrew the proposed townhouse
development and the property continued to be utilized as a trailer
court. Complaining tenants were often met with threats of eviction
though some persisted anyway. Several tenants testified that they
did not complain in writing because they believed the eviction
threats of Brandvold and they did not possess the financial
resources to move their trailers on short notice.
Out of desperation the tenants eventually began to complain to
the Health Department because of the inaction of the landlords and
Brandvold. Out of concern for their health and safety, the tenants
formed a tenants' union in August of 1985 and elected a
spokesperson. On August 13, 1985 the spokesperson/tenant received
an eviction notice. Also in August, the landlords attempted to
have the tenants sign a written rental agreement: all refused
primarily due to a clause in the agreement that stated the premises
were in a safe and tenantable condition.
After the Health Department became involved at various points,
the landlords were instructed to hook into the Missoula County
sewer system due to the severity of the septic system problems and
water contamination. To accomplish this endeavor, landlords
evicted the tenants all of whom were out of the trailer court by
July 1986.
This matter came to trial in 1991 on the 9th, 10th and 24th of
April and the District Court ruled in favor of the landlords,
stating that they did not breach the warranty of habitability in
maintaining the trailer court. Tenants appeal and we reverse.
We address only the following dispositive issue on appeal:
whether the District Court erred in deciding that the landlords did
not breach the warranty of habitability.
We utilize the "clearly erroneous" standard for reviewing
findings of fact. Steer, Inc. v. Department of Revenue (1990), 245
Mont. 470, 474, 803 P.2d 601, 603. To determine whether a finding
is clearly erroneous we have adopted the following three-part test:
First, the Court will review the record to see if the
findings are supported by substantial evidence. Second,
if the findings are supported by substantial evidence we
will determine if the trial court has misapprehended the
effect of evidence. [Citing cases. ] Third, if
substantial evidence exists and the effect of the
evidence has not been misapprehended, the Court may still
find that "[A] finding is 'clearly erroneous1 when,
although there is evidence to support it, a review of the
record leaves the court with the definite and firm
conviction that a mistake has been committed." [Citing
cases. ]
Interstate Prod. Credit Asstnv. DeSaye (lggl), 250 Mont. 320, 323,
820 P.2d 1285, 1287.
Montana enacted "The Montana Residential Landlord and Tenant
Actf1 (the Act) in 1977. Sections 70-24-101, MCA et seq. The
purpose of the Act is to: '!(a) simplify, clarify, modernize, and
revise the law governing the rental of dwelling units and the
rights and obligations of landlords and tenants; and (b) encourage
landlords and tenants to maintain and improve the quality of
housing. l1 Section 70-24-102, MCA, The term Ifdwelling unit1' is
defined by 5 70-24-103 (3) , MCA, to include person who rents
space in a mobile home park,I q making the Act applicable in the case
at bar. The Act utilizes "good faithg1 "honesty in fact" as the
or
standard in dealings and transactions between the parties. Section
70-24-103 (4), MCA.
Also instructive in the case at bar are various Administrative
Rules of Montana including: 16.10.706-Water Supply, 16.10.707-
Sewage System, 16.10.710-Solid Waste--Storage and Disposal,
16.10.754-Operator Requirements.
It is with guidance from these sources that we address the
issue of habitability; intimately intertwined with the habitability
issue is the aspect of "noticet1 the landlords of the problems
to
the tenants experienced. Therefore, for clarity, we first address
informationally the topic of I1noticel1in the case at bar before
proceeding to the dispositive issue of habitability.
The landlords argue that they were never notified nor were
they aware of the conditions so that they could repair or replace
the problem. This argument is n o t supported by the record.
Brandvold, as manager of the trailer court, lived in the trailer
court and, if he did not observe the debris and odors in and about
the trailer court, he most certainly should have. Since Brandvold
is the agent of the landlords, they must be charged with having
notice of the defects and conditions on the premises.
The landlords continue with this illogical argument in
reliance on 5 70-24-406, MCA, which provides that the tenant is to
notify the landlord in writinq of any problems. We believe that
the legislature adopted the "in writingn portion of the statute to
deter tenants from claiming that they gave notice to the landlord
when they had not. The "in writing" requirement is to assure that
the landlord was given notice and the opportunity to correct the
problem. The case at bar is not one of these cases. As stated
previously, Brandvold lived at the facility and witnessed the
defects and problems first hand; he obviously had actual notice of
all the aforementioned problems. The Health Department was also
involved on various occasions relating to the unsanitary sewage and
water conditions of the trailer court. The testimony of one of the
owners, Harold Magruder (Magruder) is riddled with the words I1I
don't recallu when asked for any specificity or detail on almost
any issue. He was particularly elusive about the notice issue and
even went so far as to state repeatedly that he was not aware of
the complaints because they were not in writing due to Brandvoldls
failure to relate the complaints to him.
Later, Magruder reluctantly conceded that he was aware of some
of the problems and that eight of the tenants were complaining.
Further, Magruder testified that he did get written notice from the
Health Department about the condition of the trailer court:
Q. Clean and safe. Was it [the trailer court] clean
according to the pictures of the refuse piled around all
of the dumpsters?
A. Well, if that -- those pictures coincided with the
date of the rental agreement, no.
Q. Wasn't the water unsafe in August of 1985? Wasn't
there a boil order in effect?
A. If that's what it [the letters from the Missoula
County Health Department] says, yes.
Q. And didn't Mr. Xikkert [the County's environmental
health specialist], several times, say that there were
serious sanitary problems going on at the trailer court?
A. Just that one mention in that one here.
Q. Well, I recall three letters by Mr. Kikkert
indicating that there were sanitation problems there.
A. Caps.
Q. That's not exactly what he said. Didn't he talk
about serious health hazards? Do you want to look at the
exhibits again?
Magruder's testimony is fraught with inconsistencies; after
claiming that he had no knowledge of the problems he then testified
that the sewer repair people were out at the trailer court trying
to fix the problems on a daily basis. Magruder also attempts to
create yet another escape route stating that he told Brandvold to
tell the tenants that if they had a serious complaint they should
bypass Brandvold and speak directly with the owners.
We find it particularly egregious that the landlords then,
with knowledge of the many problems, would present for the tenants'
signatures the lease agreement containing a statement of condition
which was untrue, let alone emphasize that the tenants refused to
sign the new lease as some example of their uncooperativeness. T h e
clause read as follows:
8. Condition: Lessee agrees and stipulates that Lessee
has examined the premises, including the grounds,
buildings, and improvements, and that they are, at the
time of this rental agreement, in good order and repair,
and in a safe, clean and tenantable condition.
Under these circumstances, we will not allow the landlords to
escape their responsibility by claiming that they were never
notified. There was actual notice under § 70-24-108, MCA.