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State Supreme Court rules in favor of Tenants' Project

May 6, 2016

Andy Davis
Iowa City Press Citizen

Iowa Supreme Court rulings made Friday are expected to have significant statewide implications, according to an attorney with the Iowa Tenants' Project.

Local attorney Chris Warnock, who has led the Iowa Tenants' Project, said the ruling made by the state high court in the lead case Elyse DeStefano v. Apartments Downtown establishes firm legal precedents.

The court ruled that, based on its interpretation of the Uniform Residential Landlord and Tenant Act, it is illegal to include provisions in leases that charge tenants carpet-cleaning fees without an inspection and to hold tenants financially responsible for damage caused by third-party vandalism.

"Pretty much every lease I've seen in Iowa they've been changed now in Iowa City because of the Tenants' Project cases have provisions that say at the end of the lease, no matter what, the tenant has to pay for professional carpet cleaning," Warnock said. "This ruling is huge. It has an impact on potentially hundreds of thousands of tenants around the state. That's a widely used provision."

According to case background included in the ruling, DeStefano and three roommates, who were University of Iowa students at the time, in July 2010 signed a lease with Apartments Downtown, Iowa City's largest landlord, for a four-bedroom home. Three months later a burglar kicked down their door, damaging the door frame and lock. At the end of the lease term, tenants were assessed door-replacement costs, a little more than $598, and a $191 carpet-cleaning fee, among other charges.

A provision included in the lease, which the tenants signed, stated that "tenants agree to pay for all damages to the apartment windows, screens, and doors, including exterior unit doors (including random acts of vandalism)," the ruling said.

"The court said the tenants could not be charged for that repair because the door has to do with safety and habitability, and those are the landlord's responsibility," Warnock said.

A ruling for the companion case, Lenora Caruso v. Apartments Downtown, was similar to that of the lead case. In the companion case, Caruso and two roommates were charged an automatic $134 carpet-cleaning fee and a $199 door-replacement fee, though damage was not the result of a burglary.

The rulings come as two class-action lawsuits brought by the Tenants' Project against Apartments Downtown and landlord Tracy Barkalow, of TSB and Big Ten Property Management, over automatic carpet-cleaning lease provisions near settlement.

In March, the Tenants' Project and Apartments Downtown filed a joint settlement proposal to be considered by the court at a July 18 hearing. Warnock represents about 14,000 tenants in the suit, which could total $1 million in repayments to tenants if it is approved.

The settlement also would forge a partnership between Apartments Downtown and the Iowa Tenants' Project where current tenants and those who may rent from Apartments Downtown, Apartments Near Campus and Apartments at Iowa over the next three lease terms would have the opportunity to be represented by the Tenants' Project.

Warnock said the case against Barkalow has been granted a preliminary approval of settlement to be considered at a district court hearing around July 11. As with the Apartments Downtown case, Warnock said tenants who rented from 2010 to 2012 can find more information and register to collect repayment online.

With Friday's rulings and the ongoing work between the Tenants' Project and Apartments Downtown, Warnock said conditions are improving for Iowa City renters, and local landlords like Apartments Downtown are making positive improvements.

"I'm happy with the standards the court has set, but there's still a lot of work to do. We're going to try to continue to try to make things better for landlords and tenants," Warnock said. "In a way, even though I'm happy to have won at the Supreme Court, I'm even happier when landlords are able to come together and work on a mutually agreeable settlement. These cases are really about principle."