Set­tle­ment made in rent law­suit

Land­lord agrees to al­ter rent col­lec­tion prac­tices

Baltimore Sun - - NEWS - By Doug Dono­van ddono­van@balt­sun.com

A large res­i­den­tial prop­erty man­age­ment com­pany has set­tled a class-ac­tion law­suit with 1,442 Bal­ti­more ten­ants who ac­cused the firm of charging im­proper fees and then threat­en­ing them with evic­tion to force pay­ment, the par­ties an­nounced Fri­day.

Dunne Wright Ser­vices, based in Bal­ti­more, de­nied the al­le­ga­tions in the law­suit but agreed to al­lo­cate nearly $663,000 to re­duce the debts of past and cur­rent ten­ants, to credit their rents and re­im­burse some costs. The com­pany also agreed to pay $61,500 in ten­ants’ le­gal fees.

The com­pany, which owns or manages 900 units through­out the re­gion, also agreed to re­write its stan­dard lease, change its rent col­lec­tion and prop­erty man­age­ment prac­tices and ad­just dis­puted fees.

Dunne Wright also agreed to de­fine “rent” “to in­clude only the fixed sum due from the ten­ant each month (not in­clud­ing re­pair charges or util­i­ties, which will be clas­si­fied as non-rent charges),” the com­pany said in a joint state­ment is­sued Fri­day with Pub­lic Jus­tice Cen­ter, the non­profit that rep­re­sented the former and cur­rent ten­ants.

The agree­ment on the def­i­ni­tion comes as judges across Mary­land grap­ple with the proper ap­pli­ca­tion of a rul­ing by the Court of Ap­peals. The court ruled in Fe­bru­ary that a prop­erty man­ager should not have claimed un­paid util­ity bills amounted to over­due rent for the pur­pose of fil­ing evic­tion pro­ceed­ings against a ten­ant.

In the set­tle­ment agree­ment, Dunne Wright agreed to abide by the same stan­dard.

Philip Gar­bo­den, a re­searcher at The Poverty and In­equal­ity Re­search Lab at the Johns Hop­kins Univer­sity who has in­ter­viewed hun­dreds of land­lords, called the set­tle­ment “a big win” for ten­ants.

“They’ve es­tab­lished that you can evict only on rent, not on fees,” he said.

Gar­bo­den said other land­lords will take no­tice of the set­tle­ment and pos­si­bly ad­just their prac­tices “to avoid be­ing the tar­get of a class-ac­tion law­suit.”

Ten­ants ac­cused Dunne Wright of fil­ing hun­dreds of fail­ure-to-pay-rent ac­tions in District Court ev­ery year not just for rent but also for late pay­ment of water bills, re­pair fees and main­te­nance charges. The ten­ants al­leged it was the com­pany’s re­spon­si­bil­ity to cover these charges.

Dunne Wright charged ten­ants $50 for fail­ure-to-pay-rent ac­tions in District Court that ac­tu­ally cost $27; $70 for fil­ing war­rants of resti­tu­tion that ac­tu­ally cost $50; and a $10 “evic­tion post­ing fee” that state law says can­not ex­ceed $5.

In the set­tle­ment, the com­pany agreed that it would stop billing ten­ants more than “the amount charged by the district court.”

Ten­ants al­leged that Dunne Wright would ap­ply their rent checks to cover over­due util­i­ties and other un­paid bills stem­ming from those ex­ces­sive fees. That left the rent not fully paid, re­sult­ing in an­other court ac­tion and the as­sess­ment of a new set of those evic­tion-re­lated fees.

“As a re­sult of this mis­al­lo­ca­tion, Dunne Wright uni­lat­er­ally deems sub­se­quent pay­ment for rent in­suf­fi­cient, churn­ing the cy­cle of lit­i­ga­tion, late fee, and il­le­gal fee ac­crual again,” ten­ants said in the law­suit.

The com­pany then used the threat of evic­tion to col­lect, the ten­ants said.

Un­der the set­tle­ment, Dunne Wright agreed to al­lo­cate ten­ants’ pay­ments to out­stand­ing rent charges be­fore ad­di­tional “non-rent charges,” to bill ten­ants only for the ac­tual costs of fil­ing court ac­tions, and to pay for re­pairs that are the com­pany’s re­spon­si­bil­ity.

The com­pany “de­nied the al­le­ga­tions of the com­plaint and dis­puted all li­a­bil­ity in the case,” it said in the joint state­ment. Dunne Wright con­tended that their prac­tices were not il­le­gal, fol­lowed cus­tom­ary prac­tices and did not vi­o­late any laws.”

KARL MER­TON FERRON/BAL­TI­MORE SUN

Kait Dougherty of Ti­mo­nium smiles while try­ing on the Ori­oles Bird mas­cot’s cap dur­ing a rally for Ori­oles fans held Fri­day night at Mother’s North Grille in Ti­mo­nium as the team makes a run for the play­offs.

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