Uninhabitable rental units result in verdict for three separate plaintiffs. San Francisco County.
Slumlords convert single-family home to multiple rental units, but fail to maintain habitable standards. Former tenants awarded $132,950 by jury. $574,759 judgment with attorney fees and costs.
- Case Name: Hurtado, et al., v. Segura, et al.
- Court and Case Number: San Francisco Superior Court/ CGC-12-517315
- Date of Verdict or Judgment: Friday, June 14, 2013
- Date Action was Filed: Friday, January 13, 2012
- Type of Case: Landlord-Tenant Issues
- Judge or Arbitrator(s): Hon. Ernest H. Goldsmith
Plaintiffs: Silvia Hurtado, retirement home workerFloridalma Bac, domestic workerCarlos Sumpalaj, construction worker
Defendants: Luis Segura, dry clean delivery van driverYolanda Segura, house cleaner
- Type of Result: Jury Verdict
- Gross Verdict or Award: $132,950, plus attorney's fees and costs for a total judgment of $574,759.44.
- Net Verdict or Award: Total by Plaintiff: Hurtado $61,900. Bac $29,950. Sumpalaj $41,100.
Award as to each Defendant:
Two-thirds against Luis Segura and one-third against Yolanda.
- Trial or Arbitration Time: 11 calendar days.
- Jury Deliberation Time: 6 hours
- Jury Polls: Liability: 12-0; Damages: 11-1.
- Post Trial Motions & Post-Verdict Settlements: Defendants' motions for JNOV were denied. Plaintiffs moved for attorney’s fees: Awarded $430,000 with a multiplier of 1.5 on hourly rates of $400 and $500.
Attorney for the Plaintiff: Philip O’Brien, San Francisco.Sundeen Salinas & Pyle by Robert Salinas, Oakland.
Attorney for the Defendant: Haapala, Thompson & Abern, LLP by David Semel, Oakland.
Plaintiff's Technical Experts: Brian Grey, residential rental value, Pacifica.Arthur Slater, pest control, Sebastopol.
Defendant's Technical Experts: None.
Facts and Background
Facts and Background:
Plaintiffs rented rooms from defendants out of a single family home in a residential neighborhood in San Francisco.
Eventually, defendants were renting out rooms including the living room, dining room, and the converted garage and installed a second kitchen. The City of San Francisco cited the property for myriad code violations including lack of egress, lack of heat, etc., and ordered defendants to remove the second kitchen, restore the garage (defendants had already removed the dining room walls they installed for use as a rental). Defendants passed inspection with the City as to restoring the garage for car use and removing the second kitchen, then immediately re-installed the second kitchen and converted the garage back to a rental room. This was later detected and re-cited by City Inspector Danny Mak.
Plaintiffs vacated after the Seguras filed an unlawful detainer (despite a pending Notice of Violations issued by the City), agreeing to reserve all claims.
That defendants were operating a single-room occupany hotel (SRO). That at any given time there were 17 to 23 unrelated occupants living in the house, with no resident manager. The result was that the house could not be kept clean or safe, as some of the occupants and their guests roamed the hallways and there was alcohol and drug use often late into the night and morning hours.
That there was garbage accumulation both inside and outside the premises, a roach infestation, no heat, and insufficient bathing and cooking facilities due to the overcrowding. That after plaintiffs complained to the City, and asserted their rights to withhold rent, defendant Luis Segura reacted by installing a video camera covering the kitchen and bathroom hallway areas, removing the stove burner knobs and oven racks, and by threatening Sumpalaj with physical injury.
That defendants breached the implied warranty of habitability, covenant of quiet use and enjoyment, CC 1942.4, and SFRO 37.10B (a superset of tenant claims).
During the trial the Court dismissed the CC 1942.4 claim based on the litigation privilege. Plaintiffs also contended that after plaintiffs complained to the City and asserted their rights to withhold rent, defendant Luis Segura cut the cable TV line and slashed Silvia Hurtado’s car tire.
Plaintiff contended that each plaintiff should prevail as to San Francisco Rent Ordinance Section 37.10B, as well as breach of the warranty of habitability; and that the SFRO 37.10B amounts should be trebled per the Ordinance.
That all three plaintiffs did not pay rent from October, 2011 through February, 2012. That the property was in the same condition when the plaintiffs moved in (2008 and 2010) as it was when they stopped paying rent and that they did not complain or notify defendants of any defective conditions until they called the Department of Building Inspection in September, 2011.
That heat was provided at all times. That Mr. Sumpalaj's claims of threats and physical violence were inconsistent and untrue. That there was no evidence supporting claimed damages.
That defendant was never cited for pests at the property, but when he noticed a roach in the garage he fumigated the entire property on August 3, 2011.
Plaintiffs stopped paying their rent after September 2011, so Mr. Segura retained an attorney who did not participate in the trial. Mr. Segura’s eviction attorney served plaintiffs with the proper Three-Day Notices to Pay Rent or Quit. After plaintiffs did not pay the overdue rent, the eviction attorney filed an Unlawful Detainer Complaint. The parties to the U.D. entered into a Settlement Agreement on January 17, 2012. Plaintiffs agreed to vacate no later than March 4, 2012, and Mr. Segura kept their security deposits and security deposit interest.
Injuries and Other Damages
Damaged electronics from roaches, damaged clothes from moisture, having to eat out due to food being stolen, kitchen not available or too dirty to use. Rent overpayment. Emotional distress, anxiety, sadness, sleeplesness.
Demands and Offers
- Plaintiff Final Demand before Trial: At the UD level, plaintiffs offered to settle for a total of $14,000.
Based upon an informal survey, plaintiffs believe theirs is the first jury verdict for violation of SFRO Section 37.10B. A timely memorandum of costs was filed and no motion to tax was brought forth, thus costs of $11,709.44 were added to the First Amended Judgment, entered November 26, 2013. Total Judgment is $574,759.44.
Per plaintiffs' counsel: At mediation in November, 2012, defendants offered $20,000, withdrawn two days later (to $0).
Per defense counsel: Defendants informed plaintiffs and the mediator they could not contribute significantly to a settlement agreement because did not earn much money and had no liquid assets. Their insurance carrier, which provided a defense pursuant to a reservation of rights, claimed none of plaintiffs’ damages were covered under the insurance policy.
Per plaintiffs' counsel:At a Mandatory Settlement Conference on December 11, 2012 with a private attorney appointed by the Court, the defense and Allstate walked out, offering nothing.
Per defense counsel: The defense and Allstate reiterated the offer of $20,000 and invited plaintiffs to show evidence supporting their claimed out-of-pocket expenses.
On April 25, 2013, at a pre-trial settlement conference with Attorney Pang Ly in Dept. 603 of this court, defendants re-offered $20,000. During the jury trial the parties stipulated to settlement discussions.
Per defense counsel: After judgment was entered, defendants’ insurance carrier filed for declaratory relief.