Kristina Lewis v. Howard L. Allen Investments, Inc., Howard L. Allen, Metro Investments, and Yogurt & More, Inc. ( 2021 )

IN THE SUPREME COURT OF IOWA
No. 19–1640
Submitted February 16, 2021—Filed March 19, 2021
KRISTINA LEWIS,
Appellant,
vs.
HOWARD L. ALLEN INVESTMENTS, INC., HOWARD L. ALLEN,
METRO INVESTMENTS and YOGURT & MORE, INC.,
Appellees.
Appeal from the Iowa District Court for Black Hawk County,
George L. Stigler, Judge.
The plaintiff appeals from the district court’s grant of summary
judgment holding that the defendants owed no duty of care on the
plaintiff’s negligence cause of action. AFFIRMED.
McDermott, J., delivered the opinion of the court, in which all
justices joined.
Eashaan Vajpeyi (argued) and H. Daniel Holm Jr. of Ball, Kirk &
Holm PC, Waterloo, for appellant.
Henry J. Bevel III (argued) of Swisher & Cohrt, P.L.C., Waterloo, for
appellees Howard L. Allen Investments, Inc., and Howard L. Allen.
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Thomas C. Verhulst (argued) of Beecher, Field, Walker, Morris,
Hoffman & Johnson, P.C., Waterloo, for appellees Metro Investments and
Yogurt & More, Inc.
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McDERMOTT, Justice.
Howard L. Allen Investments, Inc. (“Allen Investments”) sold a house
under a contract of sale. The contract required the buyers to make
monthly payments to Allen Investments for ten years, at which time the
contract would be paid in full. Allen Investments would remain on the
deed until payment in full but would have no right to possess or enter the
property during the payment period.
About five years into the payment period, the buyers leased the
house to a tenant named Kristina Lewis and her fiancé. Several months
later the house caught fire, and Lewis suffered serious injuries. Lewis,
seeking damages for negligence, sued both the buyers who leased her the
house and Allen Investments. The district court granted summary
judgment in Allen Investments’ favor, holding that the entity as contract
seller owed no duty to Lewis. In an appeal that requires us to interpret for
the first time several interrelated definitions in Iowa’s Uniform Residential
Landlord and Tenant Act, Iowa Code chapter 562A, we must answer
whether a seller of a property under a contract of sale owes a duty to a
contract buyer’s tenant.
Lewis sued not only the buyers and Allen Investments but also Allen
Investments’ president and (under an alter ego theory) its shareholders
Metro Investments, LLC, and Yogurt & More, Inc. As to the buyers of the
property under the contract of sale, Lewis claimed they were liable “[b]y
virtue of their position as lessors” of the property. As to Allen Investments
and its related codefendants (for simplicity, “Allen Investments”), Lewis
claimed they were liable “[b]y virtue of their position as deed holders” of
the property. Lewis alleged all the defendants had a duty to exercise
reasonable care to maintain the house in a safe condition for the tenants,
including particularly a duty to provide functioning fire safety equipment
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such as smoke detectors and fire extinguishers. The petition included an
allegation that the defendants failed to provide fit premises in violation of
Iowa Code chapter 562A. She sought damages for negligence that
included past and future medical expenses, past and future loss of full
mind and body, past and future mental and physical pain and suffering,
loss of earnings and earning capacity, and punitive damages.
To maintain a claim for negligence, Lewis must prove that Allen
Investments owed a duty to protect her from the harm she suffered. See
Thompson v. Kaczinski, 774 N.W.2d 829, 834 (Iowa 2009). Whether a
defendant owes a duty of care under particular circumstances is a
question of law for the court to decide. Hoyt v. Gutterz Bowl & Lounge,
L.L.C., 829 N.W.2d 772, 775 (Iowa 2013). The district court in granting
summary judgment held that Allen Investments owed Lewis no duty of
care and thus dismissed the negligence claim. We review the district
court’s ruling for correction of legal error. Van Fossen v. MidAm.
Energy Co., 777 N.W.2d 689, 692 (Iowa 2009).
In Junkin v. McClain, decided in 1936, we described a “contract of
sale” as a “contract for sale of real estate with the legal title of record
retained by the seller, pending payment of the purchase price, and upon
completion of payment of such purchase price the instrument transferring
the legal title to be delivered to purchaser.” 221 Iowa 1084, 1089,
65 N.W. 362, 365 (1936). We held in Junkin that the seller under a
contract of sale holds legal title simply as security for the contract buyer’s
payment of the remaining debt. Id.In Hollingsworth v. Schminkey, we analyzed whether a seller under
a contract of sale could be held liable for a rutted driveway on the property
that damaged a car’s muffler and put into motion a series of injuries after
carbon monoxide leaked into the passenger compartment.
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553 N.W.2d 591, 599 (Iowa 1996). We found that the contract sellers had
no right to possess the property and thus owed no duty under a negligence
theory to keep or maintain the driveway in a safe condition. Id.But Lewis argues that Hollingsworth doesn’t control the outcome of
the duty analysis in this case because Hollingsworth didn’t involve a
tenant–landlord relationship. Lewis points us instead to a statute—
chapter 562A—that she contends explicitly defines Allen Investments’ role
as a “landlord” that owes duties to her as tenant. Section 562A.15 imposes
a duty on the landlord to maintain fit premises, including complying with
the requirements of “housing codes materially affecting health and safety”
and doing “whatever is necessary to put and keep the premises in a fit and
habitable condition.” Iowa Code § 562A.15(1)(a)(1), (2) (2019).
Lewis argues the definition of “landlord” in section 562A.6(5)
imposes liability on not only the buyers—with whom Lewis had a written
lease agreement and to whom she paid rent—but also Allen Investments
as the seller that remained on the deed while the buyers paid off the house
under the contract of sale. As relevant here, that subsection defines
“landlord” as “the owner, lessor, or sublessor of the dwelling unit or the
building of which it is a part.” Id. § 562A.6(5). Lewis argues Allen
Investments’ name on the deed makes it an “owner” under this definition.
The word “owner” is separately defined in the statute as “one or more
persons, jointly or severally, in whom is vested . . . [a]ll or part of the legal
title to property; or . . . [a]ll or part of the beneficial ownership and a right
to present use and enjoyment of the premises,” including a mortgagee in
possession. Id. § 562A.6(6)(a)–(b). Under Lewis’s reading of the statute,
the buyers (as “lessor”) and Allen Investments (as “owner” because its
name remained on the deed during the contract-of-sale purchase period)
each owed her a duty of care to maintain the premises.
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Lewis’s interpretation—that where there’s a distinct owner and
distinct lessor in a particular case then both are “landlords” and are thus
jointly and severally responsible to maintain the property—lacks textual
(and contextual) support in this case. In the definitions Lewis relies on,
small words do important work. Again, “landlord” means “the owner,
lessor, or sublessor.” Id. § 562A.6(5). The word “the” used with “or” can
reasonably be read to suggest a limitation on who or what fulfills the role
of “landlord.” See Doe v. State, 943 N.W.2d 608, 611 (Iowa 2020) (use of
the definite article “the” particularizes the following noun). Lewis’s
argument suggests a reading not with the limiting force of “the” but with
an “indefinite or generalizing force of ‘a’ or ‘an.’ ” Id. (quoting Am. Bus.
Ass’n v. Slater, 231 F.3d 1, 4–5 (D.C. Cir. 2000)). Use of “the” coupled with
“or” suggests that the landlord could be “the owner” or “the lessor,” but
nothing in the definition of “landlord” requires us to consider them both to
serve as a landlord simultaneously. The code subsection that Lewis cites
to argue that Allen Investments owed a duty to maintain fit premises,
section 562A.16, similarly refers throughout to “the landlord,” again
suggesting that the duty resides with a particular landlord and not some
coexisting collection of them. See Iowa Code § 562A.15 (referencing “the
landlord” nine separate times).
The context in which we apply these definitions also undercuts a
multiple-landlord reading as well. The introductory paragraph preceding
the list of definitions in section 562A.6 begins with an important
limitation: words bear the definitions provided but “[s]ubject to additional
definitions contained in subsequent articles of this chapter which apply to
specific articles or its parts, and unless the context otherwise requires.” Id.
§ 562A.6 (emphasis added). And here, as in all instances of statutory
construction, context matters. See Iowa Ins. Inst. v. Core Grp. of the Iowa
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Ass’n for Just., 867 N.W.2d 58, 72 (Iowa 2015). Chapter 562A establishes
rights and responsibilities as between a tenant and landlord. “Tenant” is
defined as “a person entitled under a rental agreement to occupy a dwelling
unit to the exclusion of another.” Iowa Code § 562A.6(16) (emphasis
added). “Rent” is defined as “a payment to be made to the landlord under
the rental agreement.” Id. § 562A.6(10). The connection between “tenant,”
as person with a rental agreement, and “landlord,” who receives rent under
that rental agreement, provides context for how we define “landlord.”
Lewis occupied the property under a rental agreement with the
contract-of-sale buyer; Allen Investments as the contract-of-sale seller was
not a party to the rental agreement. Indeed, Allen Investments had no
knowledge of the rental agreement (nor were the buyers required to provide
Allen Investments notice of it) and had no possession or control of the
property. Lewis paid no “rent” to Allen Investments. That Allen
Investments received insurance proceeds from the fire damage to the
property isn’t “rent” and doesn’t somehow morph Allen Investments into
the landlord under chapter 562A.
Because Allen Investments owed no duty of care to Lewis to maintain
the property, we affirm the district court’s summary judgment ruling and
the dismissal of Lewis’s claims against Allen Investments.
AFFIRMED.