Taylor v. Beaudry

971 N.E.2d 313, 82 Mass. App. Ct. 105, 2012 WL 2620537, 2012 Mass. App. LEXIS 213

• Court: Massachusetts Appeals Court
• Decided: July 9, 2012
• Docket: No. 10-P-1598
• Status: Published

Opinions

Rubin, J.

This case comes to us from the Housing Court after remand in Taylor v. Beaudry, 75 Mass. App. Ct. 411 (2009) (Taylor I). The only issue before us is whether the judge properly calculated damages and costs under G. L. c. 186, § 15B(7). We conclude that, because of the preclusive effect of an earlier judgment in the District Court, the case must be remanded for judgment in a different amount, and that the plaintiff is entitled to costs under the statute.

I. Background. The tenant in this case, John Taylor, rented an apartment in Lowell in mid-November, 2003. The tenant paid the landlord, J.P. Beaudry, a security deposit of $ 1,375. The last lease expired on August 31, 2007. The tenant and the landlord have disputed whether, as the tenant contends, he vacated the premises that day or, as the landlord contends, the tenant did not vacate until the following day.

By mail postmarked October 1, 2007, the landlord sent to the tenant a check for $871.67, also dated October 1, together with an undated letter explaining that the check covered the security deposit plus accrued interest of $109.81, minus $613.14 for “damage that cannot be attributed to normal wear and tear” and for cleaning costs incurred as a result of an alleged violation of the lease agreement. It is uncontested that the landlord failed to comply with the terms of G. L. c. 186, § 15B(4)(iii), in that he failed both to sign the list of claimed damages under the pains and penalties of perjury and to provide the required written evidence of the estimated or actual cost of repairing the damage. Further, while we need not decide the issue, the deductions for cleaning costs incurred as a result of a breach of the lease may not be permitted by the statute which, as relevant here, provides that “[n]o deduction may be made from the security deposit for any purpose other than” “a reasonable amount necessary to repair any damage caused to the dwelling unit by the tenant or any person under the tenant’s control or on the premises with the tenant’s consent, reasonable wear and tear excluded.” G. L. c. 186, § 15B(4)(iii), as amended by St. 1984, c. 474.

In response to a demand by the tenant, the landlord subsequently mailed the tenant the $613.14 of the deposit that he had initially failed to return. The very next day, however, the landlord initiated litigation, bringing suit in the small claims session of the Lowell Division of the District Court Department, seeking additional use and occupancy rent under G. L. c. 186, § 3, based on his claim that the tenant, who had lived in the apartment for almost four years, had vacated it one day late on September 1, 2007. The tenant subsequently filed the complaint in this matter, claiming that the landlord had not returned the deposit within thirty days after the tenancy’s end as required by G. L. c. 186, § 15B(6)(e), and that, having failed to follow the procedures set out in c. 186, § 15B(4)(iii), the landlord was not entitled to make any deductions from the deposit. See G. L. c. 186, § 15B(6)(¿>). Accordingly, the tenant sought a judgment for three times the total amount of the deposit, plus interest, costs, and reasonable attorney’s fees, pursuant to G. L. c. 186, § 15B(7).

The landlord sought dismissal on the ground that he had paid the deposit back in full in response to the tenant’s demand. In Taylor I we held that the cause of action under G. L. c. 186, § 15B(7), for failure to return a security deposit to a tenant as required by § 15B(6)(e) arises when the landlord “fails to return to the tenant the security deposit . . . within thirty days after termination of the tenancy,” and that a subsequent, late payment of the security deposit by the landlord in response to a demand by the tenant does not entitle the landlord to dismissal of the tenant’s complaint. Taylor I, 75 Mass. App. Ct. at 415-416, quoting from G. L. c. 186, § 15B(6)(e).¹ We also concluded that the landlord had not complied with § 15(B)(4)(iii), and that he was therefore not entitled to retain any part of the deposit, ibid., and we remanded for a calculation of damages and the award of costs pursuant to the statute. The Supreme Judicial Court denied further appellate review. See Taylor v. Beaudry, 455 Mass. 1108 (2009).

II. Remand. On remand, the first issue the judge considered was what day the tenant vacated the premises. The judge initially found that the tenant remained in possession of the premises beyond the date of the expiration of his lease (August 31, 2007) and remained in possession of the premises at least until September 1, 2007, that the landlord’s check for $871.67 was mailed on October 1, 2007, thirty days later, and that it was received by the tenant on October 2, 2007. The judge concluded that “a security deposit is properly ‘returned’ within the thirty days required by the statute if the landlord deposits in the mail within thirty days a check covering the amount of the deposit.” On the basis of this conclusion, the judge’s order trebled only the amount that he concluded was wrongly withheld, $613.14. The judge also deducted use and occupancy rent for September 1, 2007, under G. L. c. 186, § 3, which establishes liability for rent from “tenants at sufferance,” to which he added five percent interest.

In response to a motion for reconsideration, however, the judge vacated his award of use and occupancy rent for the premises on September 1, 2007, stating “the court finds that the landlord had already adjudicated the claim in Lowell District Court (Case No. 07-SC-2907) seeking one day’s rent for September 1, [2007,] and that after a Small Claims trial, the court found for the tenant on the landlord’s claim. Under the doctrine of res judicata, the landlord is not entitled to such an award from this court, and the tenant’s Motion for Reconsideration is allowed as to said claim.” Although the tenant argued that issue preclusion principles also barred the landlord’s argument that the tenant had not vacated until September 1, 2007 — the basis for the claim that $871.67 of the security deposit had been returned within thirty days of the end of the tenancy •— the judge left his damages award otherwise undisturbed.

In his remand order, the judge also stated that “[a]s to the tenant’s recovery of court costs, it is important to point out that this case was not brought pursuant to the small claims procedure although it could have been. . . . Accordingly, the plaintiff in this case should not recover civil action costs. [G. L.] c. 218, § 25. See Shaheen v. Hershfield, 247 Mass. 543, 546-547 . . . (1924).” General Laws c. 218, § 25, as amended by St. 1975, c. 377, § 13, provides that “[i]n any civil action begun by summons and complaint which might have been begun under the [small claims] procedure, the rules for the procedure may provide, or the court may by special order direct, that the cost to be recovered by the plaintiff, if he prevails, shall be eliminated in whole or in part.”

The tenant filed this appeal. The landlord has not cross-appealed, and, indeed, has declined to file a brief or otherwise participate in this litigation.

III. Discussion. In this appeal, the tenant argues that the judge’s finding that the tenant did not vacate the premises until September 1, 2007, the finding upon which the judge’s conclusion is based that the check for $871.67 was mailed by the landlord within thirty days of the termination of the tenancy, is barred by principles of collateral estoppel. He is correct.

On October 11, 2007, after receiving the tenant’s letter, and before the tenant brought this action, the landlord initiated litigation in the small claims session of the Lowell District Court seeking additional rent under G. L. c. 186, § 3. On December 18, 2007, that court issued judgment in favor of the tenant. In reaching the conclusion that the tenant was not on September 1, 2007, a “tenant at sufferance” under G. L. c. 186, § 3, the judge in the Lowell District Court necessarily decided that the tenant vacated the premises on or before August 31, 2007. Under basic principles of collateral estoppel, the landlord cannot relitigate that question in this Housing Court action. See Martin v. Ring, 401 Mass. 59, 61 (1987).

Consequently, on reconsideration the judge should not only have vacated the award of rent for that one day under G. L. c. 186, § 3, but, as the tenant asked, the judge should also have vacated his finding that the tenant occupied the premises on September 1, 2007, and his conclusion, following from that finding, that the $871.67 portion of the security deposit was “retum[ed]” within thirty days of the termination of the tenancy. The case must thus be remanded for entry of an additional damages award of $871.67 trebled plus interest, less the amount initially received by the tenant.

The tenant also seeks reversal of that portion of the judge’s order denying costs. The tenant is entitled to costs under the plain language of G. L. c. 186, § 15B(7). As he points out, had he chosen to seek damages under the small claims procedure, he would have been required to give up his right to appeal; it was the landlord who first sought damages in the small claims session and not the tenant. Whatever the scope of the discretion provided by G. L. c. 218, § 25 — and it has not been cited in an appellate decision since 1924 — it cannot be read in these circumstances to allow the trial judge to deny the costs specifically provided for by G. L. c. 186. Consequently, the judgment must also be modified on remand to add the tenant’s costs.

In light of our conclusion about the preclusive effect of the District Court judgment, under the facts presented, both the mailing and the receipt of the security deposit took place beyond the statutory thirty-day deadline. We therefore need not reach the tenant’s alternative argument that the statute requires receipt, not simply mailing, of the security deposit within thirty days.² The meaning of the word “return” in this statute is an important question with broad implications for landlord-tenant law. While we do not decide the matter, we note that we have before us only a single pro se brief in this case, and the statutory question does not appear to be a simple one in light of possible difficulties involved in construction of the language of the statute,³ and of its structure⁴ and purpose.⁵

Nor need we address in any detail the dissent. Its essential quarrel is with our decision in Taylor I, where we declined to dismiss the award of damages in favor of the tenant and held that under the statute a tenant who does not receive his security deposit on time may seek treble damages even after receiving it late. The statute states that if a landlord does not return a security deposit within thirty days of the termination of tenancy, the aggrieved tenant is entitled to treble damages, costs, and attorney’s fees. See G. L. c. 186, § 15B(6)(e), (7).⁶ In Taylor I we concluded that by its “unambiguous” language the statute does not require landlords to return security deposits only when threatened with litigation. Taylor I, 75 Mass. App. Ct. at 416. Rather, we said that the statute requires landlords to follow its “clear” terms and return security deposits within thirty days of the termination of tenancy or risk suits like this one for treble damages. See ibid. The strictness of the security deposit statute’s terms is well known; indeed, almost thirty years ago, the Supreme Judicial Court concluded that even “[a] finding of good faith” provided no “basis for an exception to the multiple damages provision of G. L. c. 186, § 15B(7).” Mellor v. Berman, 390 Mass. 275, 283 (1983). Taylor I reflects a conclusion that the Legislature thought the deterrent effect of suits such as this was necessary to ensure all landlords return security deposits on time and in full compliance with the statute. The landlord in this case, for example, could have avoided damages by complying with the statute and returning the security deposit within thirty days — sufficient time in the Legislature’s judgment to examine a vacant apartment and determine if any repair is needed — either in full, or in part, accompanied by proper evidence of damage and of repair costs, if any. See G. L. c. 186, § 15B(4)(iii). The dissent’s conclusion that the result in this case “advances no remedial or deterrent policy” thus amounts to a quarrel with this court’s reading in Taylor I of the Legislature’s judgment.

And, at the end of the day, the conclusions in the dissent that the judgment in this case “so unfairly punishes a party as to cause justice to miscarry,” that a suit like this does no more than “run a landlord into the ground,” and that a decent person would have been deterred from taking legal action had his landlord retained some of his security deposit while providing a list of damages like the one at issue here, also amount to nothing more than a quarrel with Taylor I and its construction of the statute. To the extent the dissent purports to base its judgment on facts, though, we note that we see no basis in the record for its assertions (a) that this lawsuit “has a vindictive character in the worst sense of that descriptive word,” (b) that there was “waste caused by the tenant” (something that has not been established, that, so far as we know, has never been asserted in this proceeding, and about which we express no opinion), or (c) that the tenant was unharmed by the unsworn-to list of damages sent by the landlord. Nor is there any basis in the record before us for the conclusion that the amounts listed in the landlord’s letter would have been properly deductible from the security deposit under the statute. That, again, has never been established, or even asserted before us by the landlord, and it is something about which we also express no opinion.⁷

To the extent the dissent argues not merely for affirmance, but for vacatur of the judgment in favor of the plaintiff, the landlord has not in this proceeding asked for or claimed entitlement to this (or any other further) relief. The question of the propriety of that portion of the judgment is not before us. And indeed, this court is without power to vacate the judgment in favor of the tenant because, as the dissent acknowledges, the landlord has not filed a notice of appeal. It is blackletter law that in the absence of a cross appeal an appellee may not obtain a decree more favorable than the one issued below. See, e.g., Gray v. Chase, 184 Mass. 444, 452 (1903); Turgeon v. Turgeon, 330 Mass. 402, 409 (1953).⁸

IV. Conclusion. The judgment is affirmed in part and reversed in part. The tenant has requested costs in connection with this appeal. He may submit an application for costs, with supporting documentation, to this court within fourteen days of the date of rescript. See Fabre v. Walton, 441 Mass. 9, 10-11 (2004). The landlord shall have fourteen days thereafter to respond.

So ordered.

1 At the time Taylor I was decided, the Housing Court judge had found that the landlord paid the balance in response to the complaint being filed, rather than, as the judge has now found after remand, in response to an actual demand letter. The new finding is irrelevant to the analysis in Taylor I, which was premised on the rule that “the commencement of the action itself . . . operatejs] as a demand.” Taylor I, 75 Mass. App. Ct. at 415 n.9, quoting from Castenholz v. Caira, 21 Mass. App. Ct. 758, 764 (1986).

2 The tenant does not challenge the method by which the judge determined under § 15B(4)(iii) the “balance [of the security deposit] to which the tenant is entitled,” and thus neither we nor the dissent express any opinion on the propriety of that method. See Taylor I, 75 Mass. App. Ct. at 417-418 (discussing possible interpretations of the statute without deciding which resulting method of determining that balance is correct).

3 The word “return” appears ambiguous. If I borrow my neighbor’s lawn mower and give it to someone else to bring it back to him, I have not “returned” it. (Indeed, I would likely ask such a third party to “return” the item for me.) On the other hand, when a check for repayment of borrowed money is placed in the mail, one might say that the money had been “returned.”

4 With respect at least to the interest on a security deposit, where a tenancy has gone on for more than a year, G. L. c. 186, § 15B(3)(6), as amended by St. 1978, c. 553, § 2, explicitly provides that “in the event that the tenancy is terminated before the anniversary date of the tenancy, the tenant shall receive all accrued interest within thirty days of such termination” (emphasis added). This might be read to imply that the principal need not be, or it might be determined that a different rule for the principal and for the accrued interest would make no sense. To complicate matters, the statute also indicates that at the end of each year of a lease that lasts longer than a year, the landlord must “give or send” the interest to the tenant, who may deduct the interest amount from his or her rent if it is not “received” “after thirty days.”

5 If “return” includes mailing, the statute would not place the burden of the vagaries of postal delivery upon the residential landlord. On the other hand, the strictness of the statute is well known, and ensuring that a tenant actually receives a security deposit within thirty days of moving out might have been consistent with the legislative determination that failure to timely return security deposits is a serious and deeply entrenched problem warranting the unusual sanction of multiple damages. See Mellor v. Berman, 390 Mass. 275, 282 (1983).

6 While in light of our conclusion about the preclusive effect of the District Court judgment we need not decide the issue, we note that the language of § 6(e), under which treble damages are allowed for failure to return a security deposit within “thirty days after termination of the tenancy,” is not, by its terms, applicable only to tenancies under written lease agreements.

7 The Legislature has determined that the requirements of a sworn-to list, and, unmentioned by the dissent, that a landlord also present “written evidence, such as estimates, bills, invoices or receipts, indicating the actual or estimated cost” of the repairs for which he or she claims the right to withhold a portion of the security deposit, see G. L. c. 186, § 15B(4)(iii), are an appropriate means to “ensurfe] that landlords do not make spurious and unfounded deductions for damage.” McGrath v. Mishara, 386 Mass. 74, 80 (1982).

8 We would also independently be bound to follow Taylor I with respect to the question of dismissal both because it is the law of the case, King v. Driscoll, 424 Mass. 1, 7-8 (1996), and because it is stare decisis on the question whether the late payment of a security deposit requires dismissal of a suit like this under G. L. c. 186, § 15B(7). See Horner v. Boston Edison Co., 45 (1998) (published decisions express the opinion of the entire court and are binding upon subsequent panels).