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Landlord-Tenant: Pugh v. Holmes, the end of Caveat Emptor.

Posted By Cliff Tuttle | June 5, 2010

No. 451

It has been over thirty year since the Pennsylvania Supreme Court definitively laid to rest the venerable doctrine of caveat emptor in landlord tenant law and replaced it with the warranty of habitability. In Pugh v. Holmes, 486 Pa. 272, 405 A.2d 897 (1979), the Supreme Court stated that the ancient common law doctrine was rooted in an agrarian world where the land, not the dwelling was the focus.  The house that came with the farm acreage in the era when caveat emptor was adopted predated electricity, indoor plumbing and all the modern amenities. The tenant was expected to inspect the dwelling and demand repairs at the time the lease was negotiated.

Today’s tenant, by contrast, is a consumer of residential services.  He wants electricity, heat and plumbing that works.  If these essential amenities break down, he expects them to be promptly repaired.

In place of caveat emptor, the Court asserted that the modern tenancy was subject to an implied warranty of habitability.  In order to constitute a breach of the warranty, the defect must be of a nature and kind that will prevent the use of the dwelling for its intended purpose, to provide a residence fit for habitation.  At a minimum, this means that the premises must be safe and sanitary. However, this does not require the premises to be aesthetically pleasing.

Whether a particular breach of this warranty is material depends on the facts and must be determined on a case-by-case basis.

Breach of the warranty of habitability may be asserted by a tenant-plaintiff as a cause of action or by a tenant-defendant as a defense to an action for possession or rent.  It may also be plead as a counterclaim.

The tenant, either as plaintiff or defendant, has the burden of proving that he gave notice of the defect or condition to the landlord and the landlord had a reasonable opportunity to make repairs. However, it is not necessary for the tenant to prove that the defect or condition violated any statute or building code.

In Pugh, the tenant had filed an answer to a complaint for possession and damages asserting that premises were uninhabitable due to a leaky roof, lack of hot water, leaking toilet and pipes, cockroach infestation, as well as hazardous floors and steps.  The plaintiff had filed preliminary objections, asserting that under caveat emptor such matters were not a defense.  The Supreme Court remanded the case, stating that if the defendant can prove the conditions exist, it could defeat both the action for possession and for rents.

The severity of the condition will determine whether the rent is to be partially or totally abated.  And if the rent is totally abated, the Court stated, the plaintiff is not entitled to possession, because no rent is due.

Of course, the tenant may vacate the premises, if the condition constitutes a breach of the warranty of habitability. But he need not do so.  If the landlord fails to respond to a reasonable request for a repair, he may  make the repair himself and deduct the cost from the rent. He may also invoke other contract remedies, such as specific performance.

Although one method of determining damages would be to subtract the actual rental value of the premises from the contract rent, the Court stated that a tenant was not required to present such evidence.  The fair market value of a defective residence is problematical.  In a perfect world, no one would wish to rent a dwelling with a serious defect, making the value zero. But experience has shown that tenants do rent defective properties, sometimes from desperation or a lack of choices.  Or they believe representations by the landlord that the conditions are temporary and will be corrected. Moreover, such proof usually requires an expert witness, which is beyond the capability of many, perhaps most, tenants to afford.



CLIFF TUTTLE has been a Pennsylvania lawyer for over 45 years and (inter alia) is a real estate litigator and legal writer. The posts in this blog are intended to provide general information about legal topics of interest to lawyers and consumers with a Pittsburgh and Western Pennsylvania focus. However, this information does not constitute legal advice and there is no lawyer-client relationship created when you read this blog. You are encouraged to leave comments but be aware that posted comments can be read by others. If you wish to contact me in privacy, please use the Contact Form located immediately below this message. I will reply promptly and in strict confidence.

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