Mootness Requires Loss of Existing Controversy, Not Alternate Forum for Resolution of Issues on Appeal

“The ground has shifted considerably since the Marlins filed their original complaint for a declaration of rights.”  If that sounds to you like a court about to examine whether that shifting ground has mooted the appeal, then you have a good ear.

In  Marlin v. AIMCO Venezia, case no. B188407 (2d Dist. August 16, 2007), tenants (or “Marlins”) filed a declaratory judgment action against their landlord for a declaration of their respective rights under the Ellis Act, which allows “landlords who comply with its terms to go out of the rental business by evicting their tenants and withdrawing all units from the market even if doing so would otherwise violate a local rent control ordinance.”  The landlord filed a successful anti-SLAPP motion (Code Civ. Proc., § 425.16) and the case was dismissed.  While the appeal was pending, the landlord initiated eviction proceedings against the tenants and claimed that the eviction proceedings mooted the appeal because the parties’ rights under the Ellis Act could be litigated in the eviction proceedings.

The Court of Appeal disagrees.  The eviction proceedings do not end the controversy between the parties, they merely provide another forum for their resolution:

Defendants’ instigating unlawful detainer proceedings against the Marlins did not moot the controversy between the parties over the applicability of the Ellis Act, the conditions on the tentative tract map and the city rent control ordinances.  Mootness occurs when a case has “‘lost that essential character’” of an existing controversy.  A controversy remains between the parties as to their respective rights.  Indeed defendants concede this in their statement claiming the Marlins can raise their concerns in the unlawful detainer action.  The question is not whether the controversy is moot but where the controversy should be adjudicated: in the Marlins’ declaratory rights action or in the defendants’ unlawful detainer action.  The parties have not briefed this issue and we express no view on it.

(Footnote omitted.)

The court goes on to the merits for a second reason: “Furthermore, we have broad discretion to render an opinion in a case which poses issues of broad public interest and which are likely to recur even if an event occurring during the pendency of the appeal might otherwise render the underlying controversy moot.”

(Footnote omitted.)

Emotional Distress Damages for Statutory Habitability Action

In McNairy v. C. K. Realty, case no. B178918 (May 22, 2007), the Second District Court of Appeal holds that tenants may recover emotional distress damages in an action under Civil Code section 1942.4 against their landlord for breach of statutory habitability standards. Reasoning that the term “actual damages” in the statute (since amended, but still allowing for “actual damages”) has a plain meaning that includes emotional distress damages, the court rejects the landlord’s contention that emotional distress damages in such actions will lead to windfall recoveries. The statute requires severe and prolonged habitability problems, which naturally lead to inconvenience:

Generally, the residential tenant who has suffered a breach of the warranty does not lose money. He instead cannot bathe as frequently as he would like or at all if there is inadequate hot water; he must worry about rodents harassing his children or spreading disease if the premises are infested; or he must avoid certain rooms or worry about catching a cold if there is inadequate weather protection or heat. Thus discomfort and annoyance are the common injuries caused by each breach and hence the true nature of the general damages the tenant is claiming. (Quotation marks and citation omitted.)

The court notes other states had construed similar statutes to include emotional distress damages, and that other “actual damages” provisions in the California codes had been construed to include emotional distress damages. Finally, because the damages were awarded on a statutory cause of action rather than an action for breach of the lease contract, the award of emotional distress damages was not an impermissible award of tort damages in a contract action.