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Perry v. Equity Residential Management, L.L.C.

United States District Court, District of Massachusetts

August 26, 2014

BRIAN PERRY, KIM PERRY, and CHERYL MILLER, on behalf of themselves and all others similarly situated



Plaintiffs Brian Perry, Kim Perry, and Cheryl Miller, on behalf of themselves and all others similarly situated, bring this action against defendant Equity Residential Management, L.L.C., alleging that defendant violated the Massachusetts Security Deposit Statute, Mass. Gen. L., ch. 186 § 15B(1)(b), by charging plaintiffs certain fees at or before the commencement of their tenancies. Before me are defendant’s motion to consolidate cases (Docket # 46), the parties’ cross-motions for summary judgment (Docket ## 56, 69), and plaintiffs’ motion for class certification (Docket # 28).

I. Background

Brian and Kim Perry (“the Perrys”), who now reside in Illinois, lived at Longview Place in Waltham, Massachusetts, from December 23, 2011, until approximately July 2012. From May 2, 2010, through approximately July 7, 2012, Cheryl Miller lived at 10 Emerson Place in Boston, Massachusetts. Defendant, a Delaware LLC with its principal place of business in Illinois, manages and leases approximately 31 residential apartment complexes in Massachusetts, including the two buildings in which plaintiffs were tenants. All told, it leases approximately 6, 680 apartments in the Commonwealth.

In Massachusetts, [a]t or prior to the commencement of any tenancy, no lessor may require a tenant or prospective tenant to pay any amount in excess of the following:

(i) rent for the first full month of occupancy; and,
(ii) rent for the last full month of occupancy calculated at the same rate as the first month; and,
(iii) a security deposit equal to the first month’s rent . . .; and,
(iv) the purchase and installation cost for a key and lock.

Mass. Gen. L. ch. 186 § 15B(1)(b). Plaintiffs contend that defendant violated this statute by charging five mandatory, non-refundable fees at or prior to the commencement of their tenancies:

1. Application Fee - $50 per person. The Perrys paid $100; Miller paid $50.
2. Amenity Fee - also called a “move-in fee.” The Perrys paid $350 (later reduced to $99); Miller paid $500.
3. Community Fee - $500 per tenancy. Plaintiffs allege that this fee replaced the “amenity fee.” Defendant, they say, charges the fee at the commencement of the tenancy but does not collect the fee until after the first month of the tenancy. Because they paid the amenity fee, its alleged predecessor, neither Miller nor the Perrys paid the community fee.
4. Up-Front Pet Fee - pet owners pay a $250 up-front fee. Neither named plaintiff paid this fee.
5. Monthly Pet Fee - pet owners pay $30 per month. The Perrys paid this fee.[1]

Plaintiffs say these fees are unlawful because they do not fit within any of the statutorily permitted categories. They are not a security deposit, first or last month’s rent, or reimbursement for the cost of a lock and key. Their five-count complaint alleges that defendant has violated the Security Deposit Statute (Count I) and Massachusetts General Laws chapter 93A (Count II). They also contend that defendant has unjustly enriched itself (Count III) and seek a declaratory judgment that defendant’s conduct is unlawful (Count IV) and an injunction ordering defendant to stop charging fees to its Massachusetts residents (Count V).[2]

II. Motion to Consolidate (Docket # 46)

Defendant moves to consolidate this action with Vincelette v. Equity Residential Management, L.L.C., No. 13-10710-RWZ, a removed action pending before me.[3] It states as support (1) Equity is the primary defendant in both actions; (2) both actions allege violations of the Security Deposit Statute and chapter 93A; and (3) both actions involve the same allegedly unlawful fees. Docket # 46 at 1-2. Plaintiffs in the present action and in Vincellete each filed an opposition (Docket # 77, 78). First, they argue that although Equity is a common defendant, the Vincelette plaintiffs also sued the owner of each of the four individual properties in which the plaintiffs lived.[4] Docket # 78 at 1-2. Second, they claim that the present action is procedurally more advanced than Vincelette, in which little discovery has taken place.[5] Id.; Docket # 77 at 2. It makes little sense, they urge, to consolidate actions with uncommon defendants and in distinct procedural stations.

I may consolidate actions if they involve a common question of law or fact. Fed.R.Civ.P. 42(a)(2). This is a threshold issue. Seguro de Servicio de Salud de P.R. v. McAuto Sys. Grp., Inc., 878 F.2d 5, 8 (1st Cir. 1989).[6] If the party seeking consolidation passes this first test, I have “broad discretion in weighing the costs and benefits of consolidation to decide whether that procedure is appropriate.” Id. When doing so, I should consider “the convenience or inconvenience to the parties, the judicial economy, the savings in time, effort or expense and any confusion, delay or prejudice that might result from consolidation.” Gilliam v. Fid. Mgmt. & Research Co., No. Civ. A 04-11600NG, 2005 WL 1288105, at *1 (D. Mass. May 3, 2005) (internal quotation and citation omitted).

Common factual and legal questions exist. The suits allege violation of the same statutes by the same means—charging unlawful fees. The fees themselves are the same. These commonalities easily satisfy the threshold inquiry. The balancing factors point in the same direction. The substantial overlap between the cases makes consolidation more economical and expedient. And there is little reason to think that the purported procedural lag in Vincelette is significant. As the cross-motions for summary judgment make plain, these cases turn on a statutory interpretation question: whether the fees violate the Security Deposit Statute. It is not altogether clear what discovery the parties need in these circumstances, so much so that neither party bothers to spell it out. Consolidation offers substantial benefits and no intelligible drawbacks. The motion is allowed.

III. Cross-Motions for Summary Judgment (Docket ## 56, 69)[7]

A. Legal Standard

Summary judgment is appropriate “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). I must view the record in the light most favorable to the nonmovant and draw all justifiable inferences in that party's favor. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986). If the evidence presented would allow a reasonable jury to return a verdict for the nonmovant, summary judgment must be denied. Id. at 248. When the parties cross-move for summary judgment, I apply the same standard to each motion. Atl. Fish Spotters Ass’n v. Evans, 321 F.3d 220, 224 (1st Cir. 2003).

B. Violation of the Security Deposit Statute, Mass. Gen. L. ch. 186 § 15B(1)(b) (Count I)

1. Language of Section 15B(1)(b)

The main issue in this case is whether section 15B(1)(b)’s language allows a landlord to require that tenants pay up-front fees other than the four statutorily permitted charges. The parties offer competing interpretations of the statute. Plaintiffs contend that section 15B(1)(b) just lists the permissible charges; any charge not on the list is prohibited. Defendant responds that the statute’s legislative history demonstrates its ambiguity.

I am not the first to consider this matter. Two of my colleagues have held that the language of section 15B(1)(b) is unambiguous. Gardner v. Simpson Fin. Ltd. P’ship, No. 09-11806-FDS, 2012 WL 1109104, at *8 (D. Mass. Mar. 30, 2012) (Saylor, J.); Hermida v. Archstone, 826 F.Supp.2d 380, 384 (D. Mass. 2011) (Young, J.).[8] I join them. Giving the statute’s words their ordinary meaning “consonant with sound reason and common sense, ” Harvard Crimson, Inc. v. President & Fellows of Harvard College, 840 N.E.2d 518, 522 (Mass. 2006), section 15B(1)(b) simply is not susceptible of more than one reasonable construction. The statute is a list. If a fee is on the list then it is a permissible up-front charge; if it is not on the list, then it is impermissible. For this reason, I need not—and indeed, may not—indulge defendant’s spirited recitation of the statute’s history. See Pyle v. Sch. Comm., 667 N.E.2d 869, 871-72 (Mass. 1996); New Eng. Med. Ctr. Hosp., Inc. v. Comm’r, 412 N.E.2d 351, 352 (Mass. 1980) (“[W]here the language of a statute is plain and unambiguous, legislative history is not ordinarily a proper source of construction.”).

Defendant conjures ambiguity in the statute in several ways. Each is unconvincing. First, defendant asserts that the statute fails to define key terms, like “rent.” Def.’s Mem. in Supp. of Cross-Mot. for Summ. J., Docket # 57, at 5. “Rent, ” though, has an ordinary meaning, which I am bound to accept and apply. See Hashimi v. Kalil, 446 N.E.2d 1387, 1389 (Mass. 1983). Second, defendant reads the statute’s “in excess of” language to set forth a total amount of up-front charges. Mem. in Supp. at 4. No matter whether the charges fit within the statutorily permitted categories, a landlord may not require that a tenant pay more than the sum of first month’s rent, last month’s rent, a security deposit equal to one month’s rent, and the cost of a lock and key before his or her tenancy begins. Id. Judge Young rejected that interpretation in Hermida. 826 F.Supp.2d at 386-87. Defendant does not identify any flaws in his reasoning, and neither do I. Finally, defendant maintains that a plain reading of the statute is incompatible with the fundamental principle of freedom of contract between landlord and tenant. Mem. in Supp. at 7, 10. True enough. In fact, section 15B recognizes that landlord and tenant are often in unequal negotiating positions and seeks to level the playing field. Hermida, 826 F.Supp.2d at 386 (“The major legislative concern . . . has been for the tenant.”); Goes v. Feldman, 391 N.E.2d 943, 947 (Mass. App. Ct. 1979) (“By limiting the freedom of landlords and tenants to contract in this regard, the Legislature manifested a concern for the welfare of tenants in residential property who, as a practical matter, are generally in inferior bargaining positions . . . .”). Defendant’s argument contradicts the express purpose of the Legislature.

Having established that the statute creates categories of permissible charges, I must now decide whether the fees defendant charged plaintiffs fit within them.

2. Defendant’s Fees

a. Application Fee

Two Commonwealth courts have concluded that section 15B(1)(b) does not authorize landlords to charge prospective tenants an application fee. See Dolben Co. v. Friedmann, No. 10034, 2008 WL 81549, at *4 (Mass. App. Div. Jan. 2, 2008); Broad St. Assocs. v. ...

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