The enactment of the Residential Rental Agreements Act of 1977, the Landlord Eviction Remedies Act of 1981, and the Retaliatory Eviction Act of 1979 provided expanded rights and protections for residential tenants. As a result, all residential tenants have the right to fit and habitable housing, and they cannot be evicted without the judicial process of summary ejectment. The law also protects tenants from eviction in retaliation for lawfully asserting their rights to fit and habitable housing, but that law is subject to a number of exceptions. The North Carolina appellate courts have issued recent opinions that address these tenants’ rights statutes. This post will explore these statutes by reviewing the details of this recent precedent.

Gas Leaks and Notice: The Residential Rental Agreements Act and Terry v. Public Service Co.

Fit and Habitable Rental Property. Historically, the common law rule of caveat emptor (let the buyer beware) applied to residential tenancies. The tenant accepted the property in the condition it was in, and the landlord was not expected to make any repairs. The Residential Rental Agreements Act (RRAA), G.S. Ch. 42, Art. 5, codifies a warranty of habitability that is implied in every lease and cannot be waived by the tenant. G.S. 42-42(b). The RRRA determines the obligations of the landlord to keep the property in a fit and habitable condition, including making repairs and complying with applicable building codes. G.S. 42-42(a). It also determines the obligations of the tenant to give notice to the landlord of defects, to keep the property clean, and to not damage the property beyond normal wear and tear. G.S. 42-43(a).

The RRAA requires the tenant to give written notice to the landlord, except in emergency situations, of needed repairs to all electrical, plumbing, sanitary, heating, ventilating, air conditioning, and other facilities and appliances supplied by the landlord. G.S. 42-42(a)(4). However, if any of these conditions also render the property unfit or uninhabitable under G.S. 42-42(a)(2), oral notice is sufficient. See Surratt v. Newton, 99 N.C. App. 396 (1990).

The landlord cannot be held liable for violations of G.S. 42-42(a)(2) unless there is proof that the landlord had knowledge, actual or imputed, or was notified of the condition. DiOrio v. Penny, 331 N.C. 726 (1992). Knowledge may be imputed to the landlord if the tenant can offer evidence that the landlord should have known of the defective condition at the time the property was leased. In DiOrio, the plaintiff failed to offer evidence that the landlords had actual or imputed knowledge of a hazardous condition related to carpeting on the stairs where the landlords had not been notified of problems with the staircase and there was no evidence that the landlords had lived in the property at a time when the carpeting was on the staircase or was being laid.

Further, the RRAA includes a list of imminently dangerous conditions which the landlord must repair or remedy within a reasonable period of time after acquiring actual knowledge or receiving notice of the condition. G.S. 42-42(a)(8). Imminently dangerous conditions include unsafe electrical and structural conditions, lack of potable water, heating or plumbing facilities, rat infestation, and standing water, sewage or flooding.

The Explosion. In Terry v. Public Service Co. of N.C., Inc., 385 N.C. 797 (2024), the plaintiff’s wife began renting the home in September 2005. In early 2017, there were multiple reports of the plaintiff and a neighbor smelling natural gas. At least two of these reports were investigated by the Public Service Company of North Carolina and the fire department. The landlord was never informed of these instances. On April 13, 2017, the plaintiff entered the bathroom and turned on the light which caused an immediate explosion. The plaintiff suffered serious burns, requiring extensive medical treatment.

An examination that followed the explosion revealed that the pipe supplying natural gas to the furnace was severely rusted and corroded. The landlord had not inspected the furnace either before or during the plaintiff’s occupancy. The plaintiff and the landlord spoke frequently over the years, but when asked about any problems at the residence, the plaintiff said everything was fine. However, during the course of the tenancy, a hole approximately 10-12 inches long and 1.5 inches wide had developed in the bathroom flooring. Water leaking through the hole in the bathroom rusted and corroded the furnace pipe. The plaintiff never gave the landlord notice of the hole, issues with the furnace, or any water leaks.

Procedural History of the Case. The plaintiff sued the landlord for negligence, negligence per se, violation of the RRAA, and breach of the implied warranty of habitability. The landlord filed a motion for summary judgment, a procedure that allows the court to dispose of a case without a hearing if there are no genuine issues of material facts and the moving party is entitled to judgment as a matter of law. The district court granted the landlord’s motion for summary judgment, dismissing all of the tenant’s claims. The court of appeals reversed the trial court’s order, and the landlord appealed. The supreme court reversed the court of appeals and reinstated the trial court’s order dismissing the plaintiff’s claims.

Notice and Duty. While the RRAA creates a duty for the landlord to make repairs, that duty only arises once the landlord acquires actual knowledge of the need for repairs or receives notice from the tenant. The court held that the RRAA does not create a duty for the landlord to inspect the property during the tenancy. The landlord was neither negligent nor negligent per se because the landlord had no knowledge of the conditions that caused the explosion. Further, while the landlord is required by the RRAA and the warranty of habitability to do whatever is required to keep the property in a fit and habitable condition, the landlord would still have to be notified of the condition and given a reasonable opportunity to repair it.

Going Rogue: Self-Help Eviction and Myers v. Broome-Edwards

No Self-Help Eviction in Residential Tenancies. G.S. 42-25.6 provides that residential tenants in North Carolina can only be evicted from their homes by the judicial process of summary ejectment as set out in G.S. Ch. 42, Art. 3. Tenants cannot be removed by actual or constructive self-help eviction by the landlord or the landlord’s agents. Actual self-help eviction occurs when the landlord or agent locks out the tenant. Constructive self-help eviction occurs when the landlord or agent allows conditions at the rental property to become so intolerable that the tenant has no choice but to leave. For example, the landlord might cut off the power and water so that the tenant cannot remain in the property.

It is important to note that this prohibition against self-help eviction applies to lessors, landlords, and agents. G.S. 42-25.9(a). Wrongfully dispossessed tenants are entitled to recover possession of the rental property or terminate the lease and recover damages caused by the tenant’s removal or attempted removal from the lessor, landlord, or agent. Id. The tenant may also recover possession of personal property seized by the landlord or compensation for the value of the personal property. G.S. 42-25.9(b). Additionally, the rental of residential property is an act that affects commerce, so the tenant may also be able to recover treble damages and attorney’s fees under the Unfair and Deceptive Practices Act (UDPA), G.S. Ch. 75, Art. 1. Stanley v. Moore, 339 N.C. 717 (1995).

The Lockout. In Myers v. Broome-Edwards, 294 N.C. App. 364 (2024), in 2020, the landlord filed several complaints for summary ejectment against the tenant, all of which were dismissed. Following the last dismissal, the landlord instructed the property manager to lock out the tenant. The tenant’s personal property was placed on the curb. The tenant estimated that he lost over $17,000 in personal belongings, but the court found the value to be $9,725.

The Procedural History of the Case. The tenant sued the landlord and the property manager (the landlord’s agent) for breach of the implied covenant of quiet enjoyment, wrongful eviction, and violation of the UDPA. The tenant also sought and was granted injunctive relief to get back into the property. After a bench trial in district court, the trial court concluded that both defendants had engaged in self-help eviction and had violated the UDPA. The trial court awarded treble damages and attorney’s fees to the tenant. The court of appeals affirmed the trial court’s order.

Agent Beware. One of the issues raised on appeal was whether the property manager was shielded from liability by the doctrine of respondeat superior. This doctrine holds the principal responsible for the wrongful acts of an agent if the acts occur within the scope of the agency. The property manager argued that he acted pursuant to the instructions of the landlord and should not be liable. The court of appeals disagreed and pointed to the express language of G.S. 42-25.9(a) that holds agents liable for violations of the Ejectment of Residential Tenants Act.

Code Enforcement and Holdover Tenants: Retaliatory Eviction and Waters v. Pumphrey

Retaliatory Eviction and Rebuttal. The Retaliatory Eviction Act protects tenants and known residents in the household who seek to exercise their rights to decent, safe, and sanitary housing. G.S. 42-37.1(a). The protected activities include requests for repairs; complaints to government agencies about health and safety or code violations; the issuance by a government agency to a landlord of a formal complaint about the premises; attempts to exercise rights under a lease or under State or federal law; and involvement in tenants’ rights organizations. Id. In an action for summary ejectment, the tenant may raise the affirmative defense of retaliatory eviction and may present evidence that the eviction is substantially in response to the tenant doing one or more of the protected activities within the 12 months before the filing of the complaint for summary ejectment. G.S. 42-37.1(b). If the court finds the eviction is retaliatory, the action for summary ejectment must be dismissed. G.S. 42-37.2(a).

The landlord can offer evidence in rebuttal of the retaliatory eviction defense. G.S. 42-37.1(c) provides the landlord with six ways to rebut the tenant’s defense. The landlord will win if the eviction is for nonpayment of rent or violation of any other substantial condition of the lease; the tenant is holding over after the expiration of the term; the repairs complained about are the fault of the tenant; the property requires demolition or major alteration to comply with building or housing codes; the notice to quit was delivered before any of the protected activities took place; or the landlord plans to reside in the property or take it off the rental market for at least six months.

Protected Activities and Holdover Status. In Waters v. Pumphrey, 286 N.C. App. 151 (2022), the tenant had a weekly, oral lease with the landlord. In the winter of 2017, the tenant notified the landlord of issues at the property, and ultimately, made a report to his local code enforcement office. In March 2018, code enforcement issued a notice of violations to the landlord. In December 2018, the landlord filed for summary ejectment against the tenant, but his claim was dismissed in small claims court in January 2019. In July 2019, the landlord’s attorney sent the tenant a notice to quit, but the tenant failed to vacate the property, making him a holdover tenant.

The Procedural History of the Case. In August 2019, the landlord filed a second complaint for summary ejectment against the defendant and prevailed. The tenant appealed for trial de novo to district court. In October 2019, the landlord filed a motion for summary judgment. In response, the tenant filed an affidavit asserting his belief that the eviction was substantially in response to his testimony at the January 2019 hearing and his 2018 complaints to code enforcement. The district court granted the motion for summary judgment, and the court of appeals affirmed.

Exclusion to Application. In reaching its decision, the court of appeals pointed to the exclusions to the application of the retaliatory eviction statute. The relevant exclusion provides that a landlord may prevail if a tenant with a lease for a definite period of time and no option to renew holds over after the expiration of the term. The tenant had a lease for a definite period-one week- and it expired on August 8, 2019. Since the tenant was a holdover tenant, he could not prevail on a retaliatory eviction defense. The court declined to address whether the protected act by the tenant was the issuance of the code enforcement complaint or the tenant’s testimony in the first summary ejectment hearing. Given the number of exclusions which are fatal to the defense of retaliatory eviction, tenants may find it difficult to prevail on it.

Final Takeaways and Conclusion

• The RRAA creates an obligation for the landlord to repair conditions at the property, but it does not create an obligation for the landlord to inspect the property during the tenancy.
• Landlords and property managers can face liability for damages stemming from unlawful self-help evictions of residential tenants.
• The defense of retaliatory eviction is subject to a number of exclusions that if successfully asserted by the landlord, render the defense unsuccessful.

Like all relationships, the landlord-tenant relationship can be complicated. Whether the issue is liability or summary ejectment, judicial officials are required to make tough calls. Hopefully, this exploration of recent case law will help guide the way.