Two Maginnis Law attorneys, Edward Maginnis and Karl Gwaltney, recently won a critical decision in the States Court of Appeals for the Fourth Circuit. This case examined a landlord’s ability to charge and collect eviction-related fees from a tenant in default of his lease under North Carolina law.
The Plaintiff alleged that Camden Development, Inc., his former landlord, violated the North Carolina Residential Rental Agreements Act (the “RRAA”), the North Carolina Debt Collection Act (the “NCDCA”) and the North Carolina Unfair and Deceptive Trade Practices Act (the “NCUDTPA”) by improperly charging a filing fee, a service fee and an attorney’s fee (“Eviction Fees”) after he failed to make the required monthly rent payment under the lease.
After litigating this case for nearly two years, Suarez and Camden both moved for summary judgment—meaning we asked the court to decide whether the Eviction Fees were illegal. On June 25, 2018, after the parties moved for summary judgment, various landlord industry groups associated with Camden successfully lobbied the North Carolina General Assembly to change the RRAA to allow landlords to charge Eviction Fees (the “2018 Amendment”).
After the RRAA was amended because of the efforts of landlords, like Camden, the district court granted Camden’s motion for summary judgment and denied Suarez’s motion for partial summary judgment. In doing so, the district court judge concluded that the 2018 Amendment had retroactive application; meaning that the Amended Statute was deemed to have been in effect the entire time. Because it was allowed to have retroactive application, the Court found that Camden did not violate the RRAA by charging Eviction Fees.
Suarez, through his attorneys, appealed the district court’s decision to apply the 2018 Amendment retroactively and find Eviction Fees to be lawful.
After substantial briefing, the Fourth Circuit ultimately concluded that the 2018 Amendment does not apply retroactively and the pre-amendment version of Section 42-46 of the RRAA prohibited Camden from charging filing and service fees, but did authorize a reasonable attorney’s fee, but not a filing fee or a service fee. This case has been remanded to the district court for additional proceedings consistent with the Fourth Circuit’s opinion.
If you have any questions about this case, or any other class action issue, please contact our firm at 919.526.0450 or email us at info@carolinalaw.com.
