Wade v. Jobe
818 P.2d 1006 (1991)
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Rule of Law:
Utah common law recognizes an implied warranty of habitability in residential leases, which requires landlords to maintain premises that are fit for human occupation. A tenant's obligation to pay rent is dependent upon the landlord's compliance with this warranty.
Facts:
- In June 1988, Lynda Jobe rented a house from Clyde Wade for herself and her three young children.
- Shortly after moving in, Jobe discovered numerous defects, including a lack of hot water due to the water heater's flame being extinguished by sewage and water accumulating in the basement.
- The accumulated sewage produced a foul odor throughout the house.
- From July through October 1988, Jobe repeatedly notified Wade of the problem, and his attempts to fix it—pumping the basement and relighting the water heater—were only temporary.
- In November 1988, Jobe informed Wade that she would withhold rent until the sewage problem was permanently resolved.
- In December 1988, an Ogden City Inspection Division inspection revealed the premises were unsafe for human occupancy due to the lack of a sewer connection and numerous other code violations constituting a substantial hazard.
Procedural Posture:
- Clyde Wade (landlord) sued Lynda Jobe (tenant) in the second circuit court to recover unpaid rent.
- Jobe filed a counterclaim seeking an offset against rent owed due to the uninhabitable condition of the premises.
- The case was removed to the district court (a trial court of general jurisdiction) at Jobe's request.
- The district court awarded judgment to Wade for the full unpaid rent and dismissed Jobe's counterclaim, holding that Utah law did not recognize an implied warranty of habitability.
- Jobe, as the appellant, appealed the district court's judgment to the Utah Supreme Court, with Wade as the appellee.
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Issue:
Does Utah common law recognize an implied warranty of habitability in residential leases, making a landlord's duty to maintain habitable premises and a tenant's duty to pay rent mutually dependent covenants?
Opinions:
Majority - Durham, Justice
Yes. The court recognizes a common law implied warranty of habitability in residential leases, making the tenant's duty to pay rent and the landlord's duty to maintain a habitable premises dependent covenants. The court rejects the traditional common law rule of caveat emptor for residential leases, viewing them as contracts for a package of goods and services rather than a simple conveyance of land. Modern tenants often lack the bargaining power and expertise to inspect and repair properties, necessitating this protection. The warranty requires landlords to maintain 'bare living requirements' and ensure the premises are fit for human occupation. A breach occurs when defects, such as a lack of hot water or sewage problems, have a significant impact on the health or safety of the tenant. When a breach occurs, tenants may withhold rent, and damages are calculated using the 'percentage diminution' approach, which reduces the rent by the percentage that the tenant's use and enjoyment of the property was diminished.
Concurring - Howe, Associate Chief Justice
Yes. I concur with the majority's adoption of the implied warranty of habitability. However, I express no opinion on the applicability of the Utah Consumer Sales Practices Act (UCSPA), as it is not necessary to resolve that issue to provide the tenant with adequate relief under the newly recognized warranty of habitability. It is also noted that this case arose before the enactment of the Utah Fit Premises Act of 1990.
Analysis:
This case marks a landmark shift in Utah's landlord-tenant law, abandoning the archaic doctrine of caveat emptor in favor of modern contract principles. By establishing an implied warranty of habitability, the court fundamentally altered the balance of power, providing tenants with a powerful remedy against landlords who fail to maintain safe and sanitary housing. This decision aligns Utah with the overwhelming majority of American jurisdictions and establishes a clear precedent that a tenant's duty to pay rent is conditional on the landlord providing a livable home. The adoption of the 'percentage diminution' standard for damages also provides a practical, if subjective, framework for trial courts to calculate rent abatement.
