Action to recover rent. The Municipal Court of Hennepin County, A. Paul Lommen, J., entered judgment in favor of the plaintiff and defendant appealed from order denying his motion for amended findings or a new trial. The Supreme Court held that tenant who had not vacated premises prior to period for which rent was claimed could not invoke defense of constructive eviction.
This is an action to recover rent in which the defense is constructive eviction.
The matter was heard by the court without a jury and judgment entered for the plaintiff. Defendant appeals from an order denying his motion for amended findings or a new trial.
During the period in question the premises were occupied by defendant under an oral month-to-month lease and were used by him to store and repair heavy equipment. Plaintiff acquired title in September 1962. On September 18, 1962, he gave defendant written notice that the lease would be terminated on November 1, 1962, unless the defendant elected to effect an increase in monthly rental from $150 to $350. The defendant advised plaintiff that he would not remain in possession at the new rate. Nevertheless, he neither vacated the premises nor thereafter paid rent but remained in possession until about January 6, 1963.
1. In support of his claim that he was constructively evicted, defendant testified that plaintiff's renovation of the building interrupted and delayed defendant's efforts to move his equipment from the premises. The trial court rejected this defense and found that the defendant continued to operate and conduct his business on the property after November 1, 1962.
It is settled law that a tenant may not invoke the defense of constructive eviction unless he vacates the premises. In Roach v. Peterson, 57 Minn. 462, 464 N.W. 601, this court, speaking through Mr. Justice Mitchell, held:
"* * * [The tenant] cannot retain possession and at the same time refuse to pay rent. When the premises are rendered untenantable the lessee is put to his election whether he will retain possession under his lease or surrender it to the lessor. He must exercise this election promptly and within a reasonable time, and, when once made, this election is final and irrevocable."
We hold that the record supports the court's findings. Having failed to vacate on or before November 1, 1962, defendant is liable for rental during the subsequent 3 months.
[The rest of the case is procedural material which is no longer valid under current law].
The facts are undisputed. Defendant leased of plaintiff a written lease a dwelling known as 2012 Lake of the Isles Boulevard, Minneapolis, Minn., for a term beginning September 1, 1928, at the monthly rent of $112.50, payable in advance on the first day of each month. Defendant held over after expiration of the term, paying $112.50 rent in advance on the first day of every month, including the month of April, 1931. On April 1st, 1931, defendant served a written notice that he would surrender possession and terminate the tenancy before the beginning of the new monthly term on May 1, 1931. The notice was not served personally, but was mailed on March 31, 1931, and was received by plaintiff on the next day, viz. April 1st. Defendant vacated before the end of April, 1931. In this actin to recover the rent for the month of May, 1931, the court found for plaintiff. The sole question before the trial court was: Did the notice received by plaintiff on April 1, 1931, terminate the tenancy with the expiration of that month? In other words, was it served in time to end the tenancy with the end of April? It is conceded that the notice was adequate as to contents.
Gen. St. 1923 (2 Mason, 1927) § 8191, applicable here, reads: "Estates at will may be determined by either party by three months' notice in writing for that purpose given to the other party, and, when the rent reserved is payable at periods of less than three months, the time of such notice shall be sufficient. It it be equal to the interval between the terms of payment." In the case at bar the interval is a calendar month, and hence is not of the same length of every month. In Hunter v. Frost, 47 Minn. 1, 49 N.W. 327, 328, it was said: "The rule was generally adopted that the time of notice should be governed by the length of time specified as the interval between the times of payment of rent, and should be equal to one of these intervals, and must end at the expiration thereof." Therefore in the instant case the notice must terminate the tenancy with the last day of April. But the 1st day of April, the day on which the notice was received, was a part of that month, and the notice to be effective should have been served before that rental month began. In other words, if the tenancy is allowed to continue until a new rental month is begun, it is too late to serve notice so as to terminate the tenancy with the expiration of that month. It was definitely held in Budds v. Frey, 104 Minn. 481, 117 N.W. 158, 15 Ann. Cas. 24, that, when a lease is dated the first day of a month, that day is part of that month's tenancy or term, so that, if it became necessary and permissible to terminate the same by notice, the last day of that month would be the one upon which surrender of possession should take place. Remaining in possession on the next day, May 1st, would be entering on a new month by the tenant. The syllabus in Petsch v. Biggs, 31 Minn. 392, 18 N.W. 101, is: "Where, in a tenancy from month to month, the month commences on the first day, a notice served a month before the day named in it, requiring the tenant to quit on the last day of the month, it is sufficient." The notice there was served before the month began upon last day of which the tenant was required to quit.
In Alworth v. Gofdon, 91 Minn. 445, 84 N.W. 454, the notice was likewise served before the beginning of the month upon the last day of which the tenancy was to cease. And we think the general understanding of the bar has been that to end an estate at will, rent payable monthly, the notice must be given before the month begins with the last day of which the tenancy is to end. Section 477, Taylor's Landlord and Tenant (9th Ed.) states: "If a particular day is named in the notice, it must be the day of, or corresponding to, the conclusion of the tenancy, and not to its commencement; for if the latter day is named, the possession of the tenant for a new term has begun, and if this be for a time, however short, his holding must continue until determined by a new notice." Speaking of the length of the notice required, Tiffany on Landlord and Tenant, p. 1454, says: "In view of the uncertainty as to the mode of computing time in this connection, it is advisable in giving notice to quit, to allow a margin of time, and, as a matter of fact, notices are ordinarily given more than the prescribed period before the time named for the expiration of the notice." There are holdings that, where the lessor gives notice to quit, if it be given before the month begins, it is effective, although it gives the lessee the first day of the next month within which to surrender possession. Searle v. Powell, 89 Minn. 278, 94 N.W. 868; Aitkin Lodge v. Troppman & Singer, 179 Minn. 349, 229 N.W. 312. Under a statute like ours, it was held that a notice served on May 1, notifying the lessor that the lessee would surrender and quit at the end of one month from this date, was too late to save the lessee from liability for the rent for the month of June following. President, etc., of Bay \State Bank v. Kiley, 14 Gray (80 Mass.) 492. But in Walkder v. Sharpe, 14 Allen (96 Mass.) 43, it was held that "the estate of a tenant at will, who occupies under an agreement to pay rent monthly, on the first day of each month, may be determined by a written notice, given on the first day of a month, and directing him to quit and deliver up the premises on the first day of the next month, although the monthly terms began on the first day of each month."
The court, referring to President, etc., of Bat State Bank v. Kiley, supra, said if there did not appear that the day upon which the notice was given was a rent day, "but it assumed that the rent was payable for a term ending on a rent day, and not for a term ending the day before." The court goes on: "If we sustain the ruling of the court in this case, we must hold that there ought to have been a notice to quit on the day before the rent day, and served at some time prior to the preceding rent day. Adhering to the decisions above cited, and to the words of the statute as construed by those decisions, we must hold that the notice should terminate on a day when rent is payable; and it will then follow that the notice will not be sufficient in such a case as this, though it is equal to the interval between one day longer than the interval. This would be directly contrary to the statute. We do not feel at liberty to carry the construction of a statute to such a length." In that case the rent was payable on the first day of the month for the month just passed, and was not in advance. However, in a case of terminating a tenancy at will by notice, the length of notice and the time of termination of the tenancy should not be left to a dispute as to when the rent was or was not payable in advance. And, since our decisions have definitely settled that a tenancy begins on the day of the month the lease is dated, and also that it ends with the last day of that month, it follows that a new term begins on the next day. We therefore hold that, in order to end such a tenancy with the end of a rental month, the notice must be served before the first day of that month. In Massachusetts it is firmly established that a tenant may vacate or surrender possession on a rent day, even though it is the beginning of a new term. In Missouri the statute provides that, where the tenancy is from month to month, a month's notice is sufficient to terminate the tenancy. The court holds that, where the rental month begins on a certain date, and is desired to terminate such tenancy with the expiration of that month, the notice must be served before the date on which the month begins. Gunn v. Sinclair, 52 Mo. 327; Corby v. Book & Stationary Co., 76 Mo. App. 506.
Strictly speaking, the length of time given by the notice served on April 1st equals the interval of time between the rent payments of April 1, and May 1. But, with our decisions that the rental month begins on the day the lease is made, usually the day the rent is paid in advance for the month, and that it ends with the last day of the rental month, we think it more in consonance with the practice in vogue to hold, as stated, that a notice served on the first of a rental month is not in time to terminate the tenancy with the end of that month.
The order is affirmed.
Appeals were taken from two orders of the St. Paul Municipal Court, Allan R. Markert, J., for issuance of writs of restitution in actions for unlawfully detaining apartment premises after nonpayment of rent. The Supreme Court, Kelly, J., held that (1) although the appeals were taken from nonappealable orders, the Court, because of the important questions presented, would exercise discretionary review and decide the merits of the case, (2) a covenant in a lease for payment of rent and the covenants of habitability of residential premises imposed by statute are mutually dependent rather than independent, and a breach of the statutory covenants of habitability may be asserted as a defense in an unlawful detainer actin for nonpayment of rent, and (3) abandonment of the premises is a prerequisite to the assertion of constructive eviction as a defense in an unlawful detainer action for nonpayment of rent.
Reversed and remanded with directions.
1. A covenant in a lease for payment of rent and the covenants of habitability of residential premises imposed by Minn. St. 504.18, subd. 1, are mutually dependent rather than independent, and a breach of the statutory covenants of habitability may be asserted as a defense in an unlawful detainer action for nonpayment of rent.
2. Abandonment of the premises is a prerequisite to the assertion of constructive or partial constructive eviction as a defense in an unlawful detainer action for nonpayment of rent.
These appeals were taken from two orders of the municipal court of St. Paul for issuance of writs of restitution in actins for unlawfully detaining apartment premises after nonpayment of rent. The appeals have been consolidated for determination in this court. In pretrial rulings, the municipal court has held that the untenantability of residential premises cannot be asserted as a defense to an unlawful detainer action. We reverse.
About August 1, 1971, defendants, Mr. and Mrs. Robert Warthen, began renting a 1-bedroom apartment at 709 Portland Avenue in St. Paul on an oral month-to-month basis for a monthly rental of $85. After they had rented the apartment, repair and maintenance problems arose which allegedly interfered with their enjoyment of the premises. Notice of the defects and requests for their correction were given to the landlord. When no repairs were made, the Warthens withheld $35 of the rent for February 1972.
On February 16, 1972, an unlawful detainer actin was commenced by the landlord in justice court for a writ of restitution on the grounds of nonpayment of rent. Defendants' request for removal to municipal court was granted. In their answer, the defendants alleged that they were deprived of the full value of the apartment because of the repair and maintenance problems which were in violation of the Housing Code of St. Paul and of the statutory covenants of habitability contained in Minn. St. 504.18. Because of this, they denied that any additional rent was presently owing.
Two additional unlawful detainer actions pending before the municipal court against other tenants of the same apartment building were consolidated for the purpose of the court's order granting a writ of restitution. Subsequently, the landlord also commenced unlawful detainer actions against seven other tenants of the same apartment complex and an identical consolidated order was issued for those actions.
Defendant-tenants essentially raise tow issues on this appeal: (1) Whether breach of the statutory covenants of habitability under Minn. St. 504.18 constitutes a defense to an unlawful detainer action for nonpayment of rent; and (2) where the premises have not been abandoned, may constructive eviction or partial constructive eviction be asserted as a defense to an unlawful detainer action.
Before commenting on these issues, we should point out that the present appeals are taken from nonappealable orders. According to Minn. St. 566.12, an appeal is allowed only from the judgment of restitution and not from an order directing entry thereof. Northwest Holding Co., v. Evanson, 265 Minn. 562, 122 N.W.2d 596 (1963); Goldbert v. Fields, 247 Minn. 213, 76 N.W.2d 668 (1956). However, because of the important questions presented by this case, we are prompted to exercise discretionary review under Rule 105, Rules of Civil Appellate Procedure, and decide the merits of the case.
1. As a part of tenants' rights legislation enacted by the 1971 legislature, a landlord is not held, by virtue of Minn. St. 504.18, subd. 1, to covenant to keep leased residential premises in reasonable repair, fit for their intended use and maintained in compliance with applicable health and safety laws. The question whether these statutory covenants of habitability now made a part of every residential lease may be asserted as a defense to an unlawful detainer action is one of first impression to this court.
According to traditional common-law principles, a tenant's covenant to pay rent is independent of a landlord's covenant to repair and maintain the premises. Therefore a landlord's breach of his covenants does not relieve a tenant of his obligations under the lease. The payment of rent is a prerequisite to continuing in possession regardless of the failure of the landlord to fulfill his obligations to repair and maintain the premises. Se Strupp v. Canniff, 276 Minn. 558, 150 N.W.2d 547 (1967); Leifman v. Percansky, 186 Minn. 427, 243 N.W. 446 (1932); Roach v. Peterson, 47 Minn. 462, 50 N.W. 601 (1891); 49 Am.Jur.2d, Landlord & Tenant § 613. The only covenant which is dependent upon the payment of rent is the delivery of possession to the tenant. Se,, Cohen v. Conrad, 110 Minn. 207, 124 N.W. 992 (1910).
While we intimate no opinion as to the continued justification for the common-law rule of independent covenants in leases of modern urban dwellings, we do not believe the rule is applicable to the landlord's covenant's of habitability imposed by Minn. St. 504.18. These covenants are not made a part of the lease by agreement between the parties but by statutory mandate. In light of the directive of Minn. St. 504.18, subd. 3 to liberally construe the statutory covenants, we hold that these implied covenants of habitability and the covenant for payment of rent are mutually dependent rather than independent. Rome v. Walker 38 Mich. App. 458, 196 N.W.2d 850 (1972). Se Javins v. First Nat. Realty Corp., 138 U.S. App. D.C. 396, 428 F.2d 1071 (1970), certiorari denied, 400 U.S. 925, 91 S.Ct. 186, 27 L.Ed.2d 185 (1970).
The mutual dependence of the statutory covenants of habitability and the covenant to pay rent does not, however, dispose of the question whether the breach of the statutory covenants is available as a defense to an unlawful detainer action. Minn. St. 504.18 does not specify a remedy for enforcement of the covenants. Three possible alternative remedies are available to enforce the statutory covenants: (1) The tenant may assert breach of the covenants as a defense to the landlord's unlawful detainer action for nonpayment of rent; (2) the tenant may continue to pay rent and bring his own action to recover damages for breach of the covenants by the landlord; (3) the tenant, after vacating the premises and suspending rent payments, may raise breach of the covenants as a defense to an action by the landlord for the rent.
We have often observed that the object of an unlawful detainer action under Minn. St. 566.03 is to provide an adequate and summary remedy for obtaining possession of premises wrongfully held by a tenant after nonpayment of rent. In Leifman v. Percansky, 186 Minn. 427, 429, 243 N.W. 446, 447 (1932), we observed:
"* * * [A] statutory action to recover leased premises because of nonpayment of rent is a summary proceeding, involving only the present right to the possession of the premises. Where the plaintiff shows defendant in possession under a lease, and failure to pay the stipulated rent, his cause of action under the statute is complete. * * * The defenses that can be interposed are strictly limited."
We believe that the language of the unlawful detainer statute is broad enough to permit a tenant to assert breach of the statutory covenants as a defense. Minn. St. 566.03, subd. 1, sets forth the elements of an action to recover possession of premises which reads in pertinent part:
"When any person holds over lands or tenements * * * after any rent becomes due according to the terms of such lease or agreement, * * * the person entitled to the premises may recover possession thereof in the manner hereinafter provided."
Because the statutory covenants of habitability are made a part of every residential lease and are mutual with the covenant to pay rent, the rent, or at lease part of it, is not due under the terms of the lease when the landlord has breached the statutory covenants (emphasis provided).
In addition, Minn. St. 566.07 allows a tenant in defense to an unlawful detainer action to set forth "all matters in excuse, justification, or avoidance of the allegations." Prior to the adoption of the statutory covenants, the only defenses available to the tenant would be actual payment of nondelivery of possession. All other covenants were independent of the tenant's obligation to pay rent. Because of the mutuality of the statutory covenants of habitability and the covenant to pay rent, the tenant may now assert breach of the statutory covenants in "excuse, justification, or avoidance" of the landlord's action. Rome v. Walker, supra.
The legislative objective in enacting the implied covenants of habitability is clearly to assure adequate and tenantable housing with the state. That objective is promoted by permitting breach of the statutory covenants to be asserted as a defense in unlawful detainer actions. If a landlord is entitled to regain possession of the premises in spite of his failure to fulfill the covenants, this purpose would be frustrated. A tenant would be given little choice in asserting his statutory right to tenantable housing if only his alternatives were abandonment of the premises of continued payment of rent to which the landlord is not entitled because of the conditions. Se Academy Spires, Inc. v. Jones, 108 N.J. Super. 395, 261 A. 2d 413 (1970).
Permitting these matters in defense does not alter or frustrate the unlawful detainer statute's purpose of returning lawful possession in an expeditious manner. Raising breach of the statutory covenants in defense would not burden the proceedings more than raising other permissible defenses to such actions does. If the tenant asserts the defense, the landlord may move for a summary judgment to determine if the tenant's allegations raise a fact question. If not, the action may proceed in the customary manner. If a fact question is found to exist, the question of possession must await final determination of the merits of the tenant's allegations.
We are aware that pending final determination of the tenant's claim of breach of the statutory covenants, the landlord will be deprived of all or a portion of the rent while the tenant remains in possession. However, during this period the landlord will continue to experience normal operating and overhead expenses. In a building where all or a substantial number of tenants withhold their rent, this could be devastating to a landlord. Because he is deprived of rental income, he may be unable to correct the very conditions that the tenant contends render the premises untenantable. In some of the cases, the landlord may prevail and may not then be able to collect the rents due and yet would have been unable to dispossess the tenant during the delays occasioned by court proceedings.
Recognizing these potential problems, we have concluded that once the trial court has determined that a fact question exists as to the breach of the covenants of habitability, that court will order the tenant to pay the rent to be withheld from the landlord into court pursuant to Rule 67.03, Rules of Civil Procedure for the Municipal Court, and that until final resolution on the merits, any future rent withheld shall also be paid into court. The court under its inherent powers may order payment of amounts out of this fund to enable the landlord to make repairs or meet his obligations on the property or for other appropriate purposes. In the majority of cases, final determination of the action will be made quickly and this procedure will not have to be used. It is anticipated that the trial court, in lieu of ordering the rent paid into court, in the exercise of its discretion may order that it be deposited in escrow subject to appropriate terms and conditions or, in lieu of the payment of rents, may require adequate security therefore if such a procedure is more suitable under the circumstances.
2. Defendants also argue that an unlawful detainer actin for nonpayment of rent may be defended on the grounds of constructive or partial constructive eviction. We have consistently held that abandonment of the premises is a prerequisite to the defense of constructive eviction, Leifman v. Percansky, supra. No different rule is applicable to partial constructive eviction. Se Leifman v. Percansky, supra. Since defendants have not vacated their apartments, they cannot assert total or partial constructive eviction as a defense. Indeed, because of the remedies granted in this case, there is no real showing of any necessity for changing our prior holdings on this issue.
Reversed and remanded with directions to proceed with the actions in accordance with this opinion.
YETKA and SCOTT, JJ., not having been members of this court at the time of the argument and submission, took no part in the consideration or decision of this case.