Fee shifting can help restore balance to rent court

This year, the Baltimore Sun published an important series of articles on Baltimore City Rent Court. It describes a complex rent escrow system designed to protect tenants that is nevertheless dominated by landlords — even when the properties have conditions that are a serious threat to the health of the tenants. The landlords rarely suffer significant consequences for allowing unsafe property conditions, and tenants frequently struggle to navigate the system even when their cases are strong.

This is largely because landlords are almost always represented, while tenants are very rarely represented in rent court. The Maryland General Assembly could make a change to the law that would help increase tenants’ ability to get representation at no cost to the general public, would be paid for only by landlords who violate the law and would decrease the burden on Maryland courts: fee-shifting to prevailing tenants in rent escrow cases.

In the United States, unlike many other Western countries, each party to a lawsuit has to pay their own lawyers, regardless of who wins the lawsuit. There are only two major exceptions.

The first is where a contract between the parties says otherwise. Thus, landlords almost always include a provision in their leases saying that a tenant must pay the landlord’s legal fees if the landlord successfully sues the tenants, but the leases almost never allow a tenant to recover their attorneys’ fees from the landlord if the tenant wins.

The second exception is where a fee-shifting statute allows a prevailing party to recover their fees from the other side.

There are over 100 Maryland statutes permitting the recovery of attorneys’ fees for violations, including everything from the Consumer Protection Act to wage violations to chopping down merchantable trees without the owner’s permission.

Maryland’s high court has stated that “the goal of fee-shifting statutes in general is to ensure that individuals, when injured by violations, or threatened violations, of certain laws, have access to legal counsel by a statutory assurance that his or her counsel will be paid a reasonable fee.”

The Maryland Access to Justice Commission has stated that a fee-shifting statute “connects the individuals who may have been harmed with counsel who can aid them in seeking to enforce their rights under the law” and stated that the lawyers who take on these matters provide “a significant public benefit by enforcing the law, deterring future misconduct and promoting compliance with the law.”

As an example of the power of fee-shifting, one of The Sun’s articles noted that in the past seven years, there were approximately 49 convictions of Baltimore City landlords for criminal violations toward their tenants, resulting in about $66,000 in fines collected. Our organization, Civil Justice, represented a single Baltimore City tenant in an illegal eviction case and secured a settlement of almost the same amount as those 49 convictions combined; we settled for $65,000. We were able to secure that great result for the client in part because a fee-shifting statute applied to the matter.

There are several areas of landlord/tenant law where Maryland does provide for fee-shifting to a prevailing tenant, including illegal lockouts, security deposit disputes, retaliatory evictions and when a landlord unlawfully shuts off power. But there is no fee-shifting statute available in rent escrow cases, even when the tenant can show that the landlord did nothing after learning that the property’s condition is a threat to the health and safety of the tenant.

Civil Justice promotes access to justice by helping to connect Marylanders with private attorneys with innovative practice models who can provide affordable legal representation. Often, that affordability is based on fee-shifting statutes. We are frequently able to get legal representation for tenants where there is fee-shifting, but we are almost never able to find representation for tenants in rent escrow cases because of its absence.

Evictions cause enormous disruption, costing the government money to carry out the eviction and often sending the tenants into a spiral of job-loss and homelessness. Providing fee-shifting to tenants who successfully establish a rent escrow would create a market for private lawyers to help those tenants with good cases, would make it so the cost is borne solely by the bad landlords who violate the law by refusing to repair serious conditions, and would help restore balance to rent court.

Joseph Mack is executive director of Civil Justice Inc., a Maryland non-profit that promotes access to the civil justice system for low and moderate income clients. His email is jmack@civiljusticenetwork.org.

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