When a residential landlord leases a rental unit to a tenant, there is a statutory covenant that the landlord will provide the premises in a habitable condition for use. Even if the language is not codified in the lease agreement, it is still a legal duty that can amount to an actionable violation by the tenant under Michigan law. MCL 554.139 states as follows:
- (1) In every lease or license of residential premises, the lessor or licensor covenants:
- (a) That the premises and all common areas are fit for the use intended by the parties.
- (b) To keep the premises in reasonable repair during the term of the lease or license, and to comply with the applicable health and safety laws of the state and of the local unit of government where the premises are located, except when the disrepair or violation of the applicable health or safety laws has been caused by the tenants willful or irresponsible conduct or lack of conduct.
- (2) The parties to the lease or license may modify the obligations imposed by this section where the lease or license has a current term of at least 1 year.
- (3) The provisions of this section shall be liberally construed, and the privilege of a prospective lessee or licensee to inspect the premises before concluding a lease or license shall not defeat his right to have the benefit of the covenants established herein.
Some circumstances that can amount to a breach of the implied warranty of habitability include a non-functioning furnace, the presence of significant mold or holes in the roof (provided they were not caused by the tenant AND the landlord did not take reasonable steps to repair them.
At common law, the tenant’s covenant to pay rent was separate from the landlord’s covenant to keep the premises in reasonable repair and comply with applicable health and safety laws. This means that the landlord’s failure to repair does not excuse the tenant’s duty to pay rent, or vice versa (legal remedy for a breach of either covenant would have to be sought in the courts). But with the passage of the tenant’s rights act (Public Act 297 of 1968), the tenant is now allowed to raise the question of a landlord’s breach “which excuses the payment of rent”. MCL 600.5720(f). In Rome v Walker, 38 Mich App 458; 196 NW2d 850 (1972), the Michigan Court of Appeals held that the district court properly rejected the landlord’s motion for summary disposition to evict tenants for rent non-payment when the tenants claimed they withheld payment due to landlord’s breach of the implied warranty of habitability. Although the covenant to pay rent and the covenant to repair and comply with safety and health laws are still mutual covenants, the tenant is now permitted by statute to raise the issue as a defense against the landlord’s action for possession.
When violation of the implied warranty of habitability is found during an eviction proceeding for non-payment of rent, MCL 600.5741 states “…the jury or judge shall deduct any portion of the rent which the judge or jury finds to be excused by the [landlord]’s breach of one or more statutory covenants imposed by … MCL 554.139.” This recognizes that the tenant’s unwillingness to pay may be due to a constructive eviction. “[C]onstructive eviction occurs when the act of the landlord is of such character as to deprive the tenant of the beneficial use and enjoyment of the whole or any part of the demised property, to the extent he is thus deprived; constructive eviction can also be found where a landlord fails to supply essential services.” Belle Isle Grill Corp. v City of Detroit, 256 Mich App 463, 474; 666 NW2d 271 (2003).
Outside of the context of eviction proceedings, what options do tenants have when the landlord does not make the necessary repairs to keep the premises habitable?
- COMMON LAW REPAIR AND DEDUCT – A tenant has a common law right to make repairs and either recover the costs of the such repairs from the landlord and deduct them from the rent. However, the tenant must first give reasonable notice to the landlord of the defect. “Unless the landlord’s duty to repair is expressly made conditional upon receipt of notice from the tenant, such duty may arise from the landlord’s actual knowledge of the need to repair”. Anchor Inn of Mich., Inc. v Knopman, 71 Mich App 64; 246 NW2d 416 (1976).
- STATUTORY RIGHT TO REPAIR AND DEDUCT – MCL 125.534(5) of the Housing Law of Michigan, Act 167 of 1917, states: “[i]f an occupant is not the cause of an unsafe, unhealthy, or unsanitary condition, or a violation of this act, and is the complainant, the court may authorize the occupant to correct the violation and deduct the cost from the rent upon terms the court determines just.” This remedy requires court action.
- BREACH OF CONTACT ACTION – According to the Michigan Supreme Court in Allison v AEW Capital Mgt, LLP, 481 Mich 419, 425-426 (2008), “… a breach of the duty to maintain the premises under MCL 554.139(1)(a) or (1)(b) would be construed as a breach of the terms of the lease between the parties and any remedy under the statute would consist exclusively of a contract remedy.” A breach of contract action can seek either the recovery of compensatory damages from the landlord or to enforce specific performance of the contract.
A tenant is not free to simply walk away from the lease agreement on the basis of inhabitability and believe the landlord won’t take action on the unpaid rent. Since the covenants are mutual, the tenant must either seek an agreement from the landlord to terminate the lease or seek relief of the contractual terms from the district court. A unilateral abandonment of the premises will create more problems than it solves. You should consider seeking the advice of an experienced lawyer before considering such a rash action.
Here are some other aspects of the implied warranty of habitability as determined by appellate courts that tenants should know:
- Robart v McAvinchey, unpublished per curiam opinion of the Court of Appeals, issued May 19, 2005 (Docket No. 253825) – The Michigan Court of Appeals determined that it was not improper for the landlord to contract away the covenants of habitability because, under the plain language of MCL 544.139(2), the lease agreement was for a one-year period to so the parties were permitted to modify the obligations.
- Allison v AEW Capital Mgt, LLP, 481 Mich 419, 751 NWd 8 (2008) – Plaintiff injured her ankle when he slipped on the snow and ice that accumulated in his apartment building’s parking lot and subsequently sued the landlord for violating MCL 554.139(1)(b). The Michigan Court of Appeals found that the parking lot was a common area covered by the law, but that the landlord did not violate their duty because the parking lot was “fit for the use intended by the parties” (e.g. parking vehicles) and the natural accumulation of snow and ice is not subject to the landlord’s duty of reasonable repair.
- Hadden v McDermitt Apartments, LLC, 287 Mich App 124; 782 NW2d 800 (2010) – Plaintiff was a tenant in an upstairs apartment who slipped and fell on black ice on the stairway and fractured her hip, despite telling the landlord beforehand about the hazard. Although seemingly similar to Allison, the Michigan Court of Appeals determined that the stairway was not fit for the intended purpose of walking up and down and the landlord had a duty to repair. It was erroneous for the trial court to grant summary disposition in favor of the landlord.
- Cunningham v McKinley Inc., unpublished per curiam opinion of the Court of Appeals, issued February 13, 2014 (Docket No. 313062) – Plaintiff was a guest at her friend’s apartment building who slipped on torn carpet on the staircase and fell. She subsequently sued her friend’s landlord for damages on the basis that the implied warranty of habitability was violated. The Michigan Court of Appeals determined that MCL 554.139 only applies to contractual parties and, since the plaintiff was not in an agreement with the landlord, it was proper for the trial court to dismiss the lawsuit.
If you have any questions about the implied warranty of habitability or any other aspect of property law, do not hesitate to contact the attorneys at Kershaw, Vititoe & Jedinak PLC.