As part of an ongoing series, the author, a practicing landlord/tenant attorney, discusses 5 of the most recent changes in North Carolina landlord tenant law and the practical affect these changes may impose upon an unsuspecting landlord.

Newletter #2 - Landlords vs. Tenants: Who Pays When Bed Bugs Invade?

By Johnson December 20, 2010

Cimex lectularius, or bed bugs as they are commonly known, are now a pandemic, not just here in the United States, but around the world. North Carolina landlords must take necessary contractual precautions to mitigate their exposure to lawsuits relating to this menace. Across the Country, property owners and landlords are experiencing a 500 percent increase in bed bug infestations. In some jurisdictions, legislatures have declared bed bugs as an official "public nuisance". In New York, bed bug complaints rose from 1,839 in 2005 to 8,830 in 2008'.

Once bed bugs are discovered, it is imperative that landlords take immediate remedial actions to eradicate an infestation. Property owners who fail to take the necessary steps to eradicate bed bugs from an apartment may experience a situation in which the bed bugs existing within one unit, may migrate throughout the entire building, thereby allowing multiple tenant claims for breach of warranty of habitability, exposing the owner to rent abatement damages and an inability to effectively lease a building with a bed bug stigma. Landlords should have a pre-determined plan that is derived from consultations with a qualified extermination company. The plan should provide a landlord with a step by step method to treat for bed bugs. Once a landlord is notified of the existence of bed bugs within a unit, a landlord should maintain a detailed chronology of the facts concerning the bed bug complaint and note each step that was undertaken by the landlord to eradicate an infestation. These records would be vital to an attorney in the event a tenant brings a claim against a landlord for damages associated with a bed bug infestation.

As part of a comprehensive bed bug policy to prevent infestations, eradicate colonies if they arise, and prevent lawsuits and other risks caused by bed bugs, the following are some suggestions:

Step 1: Before Signing a Lease Agreement with New Tenants
  • When your rental unit is vacant, have it inspected and certified bed bug-free by a licensed pest control company. Train your staff to recognize bed bugs and signs of their infestation, so that you are better equipped to catch an infestation early on, when it's still relatively easy to treat.
Step 2: The Lease Agreement Itself
  • Your lease agreement should contain language that makes it clear that the tenant is responsible for paying all pest control services necessary, including bed bugs treatment. It should also require tenants to report all pest sightings - including bed bugs - to the landlord or property management immediately.
Step 3: Include a Bed Bug Lease Addendum
  • Tenants should be given, upon signing the lease agreement, a copy of the bed bug certification, and should sign an addendum acknowledging both receipt of the certification and that the rental unit was bed bug-free upon move-in. Specify that the tenant is contractually obligated to allow entry to pest control exterminators to treat a bed bug infestation if it arises, and to cooperate fully in eradicating any bed bug infestations. Additionally, indicate that failure to report bed bugs or to cooperate in their treatment is a breach of the lease agreement, and is cause for lease termination.
Step 4: Include Bed Bug Information Along with your Lease Agreement
  • Educate tenants about what bed bugs look like, how to identify signs of their presence, where they like to live, how to prevent their entry to the rental unit, and that reducing clutter in the apartment reduces the number of places they can live.
Step 5: Bed Bug Treatment
  • The earlier you treat a bed bug infestation, the easier it is to contain and eradicate. Contact your pest control company immediately upon evidence of an infestation. Second, inform tenants not to move any of their furniture or belongings before the pest control exterminators arrive - moving belongings can spread the infestation.
  • The items that can be washed, such as linens, blankets, sofa covers, and clothes, should be washed in the hottest possible water, with detergent, and dried with high heat. Furniture may need to be destroyed, depending on the recommendation of the pest control company.
  • The pest control company has a variety of treatments available at their disposal, including the use of steam, extreme heat or cold, chemical carpet treatments, and fumigation. These treatments should only be performed by a licensed professional.
WHAT IS YOUR POTENTIAL EXPOSURE?

In North Carolina, a property owner of residential premises is statutorily required, from the inception of the lease and throughout the term of the lease, to provide the leased premises in a fit and habitable condition. N.C.G.S. 42-42. A caveat to the "Implied Warranty of Habitability", is that a residents remedy is limited to cases where an owner fails to make necessary repairs within a reasonable time. Our Courts have held that before a resident is entitled to a rent abatement or other damages, he/she must notify the owner of the defective condition and afford the owner the opportunity to repair within reasonable amount of time.

If a landlord is notified of a defective condition, such as bed bugs, and the landlord fails to take immediate corrective action, a landlord is faced with more than the possibility that their tenants may receive a rent abatement or credit. A tenant may also: (i) declare a constructive eviction and vacate the premises; (ii) file an action to recover the rents paid; and (iii) seek treble damages under our States unfair and deceptive trade practices statutes N.C.G.S. 42-50 et.al; and (iv) seek to impose the cost of the resident's attorney's fees from the property owner.

As of the date of this article, there has not been a published decision in North Carolina regarding a bed bug infestation claim against a landlord, other states including New York have had published cases, and these may provide insight into how a bed bug case may be addressed by a North Carolina Court.

COURT CASES OUTSIDE NORTH CAROLINA

In Mathias v. Accor Economy Lodging Inc. v. Motel 6 Operating L.P., the United States Court of Appeals for the Seventh Circuit upheld an award of punitive damages award against Motel 6 because of bed bug infestation. The plaintiffs were guests of the motel who were bitten repeatedly during their stay at the motel. The motel operator was fully aware of the bed bug infestation for a period of more than two years before the plaintiff's stay at the motel. The operator was advised by an exterminator to spray every room due to the extent of the infestation. The motel operator was unwilling to close his establishment for the period necessary to spray the rooms and properly treat the infestation. As a result of the foregoing facts, at trial, a jury awarded each plaintiff $5,000 in compensatory damages and $186,000 in punitive damages. The Seventh Circuit upheld the punitive damages award, based upon the wanton and willful conduct of the motel operator.

In 2003, an action was brought against Helmsley Park Lane Hotel in New York after a guest suffered numerous bed bug bites while staying at the property. The owner of the hotel settled the suit for $150,000.

In 2004, New York County's Civil Court, in the case of Ludlow Properties, LLC v. Young, 780 N.Y.S. 2d 853 (N.Y. City Civ. Ct.) the court distinguished between bed bugs and other vermin, like mice and roaches. The Court found that the presence of roaches and mice, while offensive, does not constitute constructive eviction. The court distinguished between bed bugs and other types of vermin - noting that "bed bugs feed upon one's blood in hoards while one is sleeping, thus turning a night's sleep into a hellish experience." The Court ruled that a bed bug infestation is an intolerable condition that breaches the warranty of habitability opening the door to entitling a tenant to treble damages and attorney's fees.

WHAT SHOULD YOU DO?

Landlord's must be prepared for potential situations with tenant who either (i) allege that bed bugs existed within the leased premises prior to their occupancy; or (ii) refuse inspection/treatment once beg bugs are detected in the leased premises. Landlord's are strongly encouraged to retain the services of a qualified landlord/tenant attorney to review and/or provide a bed bug addendum to their lease agreements.

The information you obtain in this article is not, nor is it intended to be legal advice. You should consult an attorney for individual advice regarding your own situation.