PROPERTY (Section 1)
Spring Semester 2013

Condition of the Premises
Pages 440-473

1. Lambert signs a one-year lease to rent an apartment in a luxury apartment building owned by Trump. The agreement provided that Trump would provides maid service, a concierge, a doorman, and 24-hour repair services. When Lambert moves in, he discovers that the “maid service” is incompetent (they never vacuum to his exacting specifications), the concierge is a clueless college student, and the doorman was fired after drinking on the job and was not replaced. Further, when Lambert had a plumbing problem, it took Trump more than a full day to repair it! [Where are you supposed to get reliable, prompt service anymore?] Lambert wants to terminate the lease and move into a different apartment. Can he successfully argue that the lease is terminated due to Trump’s failure to provide bargained-for services? Why or why not? What additional information would you wish to discover?

2. Mitchell signs a one-year lease to rent a poorly-maintained home owned by Bowman. The agreed rent is $250/month. The lease provides as follows: "Landlord has no responsibility for the physical condition of the premises or any of its systems. Landlord is not responsible to fix the plumbing, wiring, heating, or any other mechanical systems in the building. Tenant agrees to be fully responsible for the cost of making any and all repairs that Tenant wishes to make, and Tenant also agrees that Landlord shall have no responsibility for such costs. It is the intention of the parties, by this agreement, that Landlord shall have no duty to provide habitable premises or to maintain the premises in habitable condition. LANDLORD DOES NOT WARRANT THAT THE PREMISES ARE HABITABLE AND TAKES NO RESPONSIBILITY FOR THE CONDITION OF THE PREMISES."

Two months into the lease, Mitchell is startled when a portion of the ceiling in his bedroom collapsed, narrowly missing him while he was sleeping. Fearful for his continued safety, he abandons the premises and ceases paying rent. The following month, Bowman sues Mitchell to collect the unpaid rent for that month. Mitchell files a counterclaim seeking damages against Bowman on account of the physical condition of the premises. How should this claim be resolved? What additional information might be relevant, and why?

3. L and T enter into a 1-year lease for T to lease an apartment (in a 90-unit apartment building). The lease provides that "If the premises become uninhabitable during the term of the lease, Tenant may terminate the lease; provided, however, that the Landlord shall have 30 days in which to make repairs in order to restore the habitability of the premises, in which case the Tenant shall remain liable hereunder. Tenant is entitled to an abatement of rent during any period in which the premises are uninhabitable." T has come to you for advice. T has had repeated problems with the apartment, including: leaking gas lines, sewage dripping onto the ceiling due to leaking plumbing, and mold (due to water damage caused by leaking pipes). Each time, L has made minimal repairs, but only after repeated complaints by T. T wants to know if T can terminate the lease for breach of the implied warranty of habitability. Based on the provision quoted above, what advice would you give to T? Why?

4. Should the implied warranty of habitability be breached by the presence of second hand smoke from other tenants? Are you persuaded by the court's reasoning in Poyck v. Bryant?

5. Barnes signs a three-year lease of a building in which he plans to operate a restaurant. The lease is silent about the tenant's responsibility for maintenance of the roof of the building. One week after the lease commences, Barnes discovers the roof is leaking after a huge rainstorm. The leak resulted in heavy flooding that closed Barnes's restaurant for several days. When Barnes demands that Landlord fix the roof, Landlord refuses. Barnes then vacates the premises and refuses to pay further rent. What result, if Landlord sues Barnes to collect unpaid rent? Why?

6. Do you think that the court decided Hadian v. Schwartz correctly? Why doesn't the lease's "compliance with laws" clause (quoted on p. 463) shift to the tenant the cost of complying with regulations such as the earthquake retrofitting order? Why does it matter whether the lease involved was a "net lease"?