                               NO.    91-556
            IN THE SUPREME COURT OF THE STATE OF MONTANA
                                     1992


BERNICE MATHES, GEORGE LaVOIE,
PETE SKELSKY, RICHARD SCHWARZ,
CORA LINN, NORRIS AMUNDSON,
DORIENNE AMUNDSON, TOM TALARICO,
SHERYL MANGINELLI, and HAROLD
MANGINELLI,
                                                      AUG 9 8 1992
            Plaintiffs and Appellants,               A   "
                                                              6
                                                             -3ir   . :<
     -vs-                                       CLERK GF S1JPi?E;2K COURT
                                                   STATE OF liiiiib~ci3,idA
BILL ADAMS and HAROLD MAGRUDER,
            Defendants and Respondents.



APPEAL FROM:     District Court of the Fourth Judicial District,
                 In and for the County of Missoula,
                 The Honorable Jack L. Green, Judge presiding.


COUNSEL OF RECORD:
            For Appellants:
                 Klaus D. Sitte, Montana Legal Services Association,
                 Missoula, Montana
                 Norris Amundson, Pro Se, Missoula, Montana
            For Respondents:
                 Christopher B. Swartley, Datsopoulos, MacDonald &
                 Lind, Missoula, Montana


                                 Submitted on Briefs:         April 15, 1992
                                               Decided: August 18, 1992
Filed:
Justice John Conway Harrison delivered the Opinion of the Court.

     This is an appeal from the Fourth Judicial District Court, in
and for the County of Missoula, the Honorable Jack L.                     Green
presiding. Appellants were all tenants of a Missoula trailer court
at one time or another.        They appeal the decision of the District
Court which held that the landlords did not breach the warranty of
habitability.      We reverse.
     This action began in 1983 when Bill Adams and Harold Magruder
(landlords) purchased a Missoula trailer court known as the "River
          #. ,
           . ~"
           J
Road Trail Court.      Mervin Brandvold (Brandvold) became the on-site
manager and leased mobile home spaces to numerous individuals, some
of whom are the appellants (tenants) in this action. Shortly after
purchasing the trailer court the landlords made promises to reseed
lawns and pave streets, neither of which          was   done.    They also made
various rules for the trailer court and its residents which went
unenforced over the course of several years; the manager actually
participated in breaking the rules.
     The tenants experienced various maintenance problems the most
serious   to      include   garbage     accumulation     due     to   inadequate
collection services, septic system overflows and backups, and a
contaminated water system.            The tenants complained regularly,
resulting in little or no action from the landlords or Brandvold.
     In   1985,     the     landlords   decided    to    build    a   townhouse
development on the trailer court site and submitted proposals to
that end with the appropriate authorities.                To accomplish the
project, eviction of the trailer court tenants would be necessary.
                                        2
As consideration of the townhouse development progressed, the
tenants continued to be plagued with severe problems with the water
and sewer systems as well as garbage collection and general
cleanliness of the common areas of the trailer court.
     At one point a "boil order" was levied due to a contaminated
water sample test obtained by the Missoula City-County Health
Department (Health Department).         It was not uncommon that raw
sewage spilled out onto the ground and sewer risers on vacant
trailer spaces had loose fitting caps or were left uncapped
completely.     Little or no effort was made to clean up the spills
leaving    a    detestable   odor    throughout      the    trailer   court,
particularly in warm weather.
     Eventually,     landlords      withdrew   the    proposed    townhouse
development and the property continued to be utilized as a trailer
court. Complaining tenants were often met with threats of eviction
though some persisted anyway. Several tenants testified that they
did not complain in writing because they believed the eviction
threats of Brandvold and they did not possess the financial
resources to move their trailers on short notice.
     Out of desperation the tenants eventually began to complain to
the Health Department because of the inaction of the landlords and
Brandvold. Out of concern for their health and safety, the tenants
formed a       tenants' union    in August     of    1985   and   elected   a
spokesperson. On August 13, 1985 the spokesperson/tenant received
an eviction notice.     Also in August, the landlords attempted to
have the tenants sign a written rental agreement: all refused
primarily due to a clause in the agreement that stated the premises
were in a safe and tenantable condition.
     After the Health Department became involved at various points,
the landlords were instructed to hook into the Missoula County
sewer system due to the severity of the septic system problems and
water contamination.    To accomplish this endeavor, landlords
evicted the tenants all of whom were out of the trailer court by
July 1986.
     This matter came to trial in 1991 on the 9th, 10th and 24th of
April and the District Court ruled in favor of the landlords,
stating that they did not breach the warranty of habitability in
maintaining the trailer court.   Tenants appeal and we reverse.
     We address only the following dispositive issue on appeal:
whether the District Court erred in deciding that the landlords did
not breach the warranty of habitability.
     We utilize the "clearly erroneous" standard for reviewing
findings of fact. Steer, Inc. v. Department of Revenue (1990), 245
Mont. 470, 474, 803 P.2d 601, 603. To determine whether a finding
is clearly erroneous we have adopted the following three-part test:
     First, the Court will review the record to see if the
     findings are supported by substantial evidence. Second,
     if the findings are supported by substantial evidence we
     will determine if the trial court has misapprehended the
     effect of evidence.       [Citing cases. ]    Third, if
     substantial evidence exists and the effect of the
     evidence has not been misapprehended, the Court may still
     find that "[A] finding is 'clearly erroneous1 when,
     although there is evidence to support it, a review of the
     record leaves the court with the definite and firm
     conviction that a mistake has been committed." [Citing
     cases. ]
Interstate Prod. Credit Asstnv. DeSaye (lggl), 250 Mont. 320, 323,
820 P.2d 1285, 1287.
     Montana enacted "The Montana Residential Landlord and Tenant
Actf1 (the Act) in 1977.      Sections 70-24-101, MCA et seq.       The
purpose of the Act is to: '!(a) simplify, clarify, modernize, and
revise the law governing the rental of dwelling units and the
rights and obligations of landlords and tenants; and (b) encourage
landlords and tenants to maintain and improve the quality of
housing. l1   Section 70-24-102, MCA,     The term Ifdwelling unit1' is
defined by 5 70-24-103 (3) , MCA, to include         person who rents
space in a mobile home park,I q making the Act applicable in the case
at bar.   The Act utilizes "good faithg1 "honesty in fact" as the
                                       or
standard in dealings and transactions between the parties. Section
70-24-103 (4), MCA.
      Also instructive in the case at bar are various Administrative
Rules of Montana including: 16.10.706-Water        Supply, 16.10.707-
Sewage    System,    16.10.710-Solid    Waste--Storage   and   Disposal,
16.10.754-Operator Requirements.
      It is with guidance from these sources that we address the
issue of habitability; intimately intertwined with the habitability
issue is the aspect of "noticet1 the landlords of the problems
                                to
the tenants experienced.     Therefore, for clarity, we first address
informationally the topic of I1noticel1in the case at bar before
proceeding to the dispositive issue of habitability.
      The landlords argue that they were never notified nor were
they aware of the conditions so that they could repair or replace
the problem.        This argument is n o t supported by the record.
Brandvold, as manager of the trailer court, lived in the trailer
court and, if he did not observe the debris and odors in and about
the trailer court, he most certainly should have.     Since Brandvold
is the agent of the landlords, they must be charged with having
notice of the defects and conditions on the premises.
     The   landlords continue with this illogical argument in
reliance on 5   70-24-406,   MCA, which provides that the tenant is to
notify the landlord in writinq of any problems.       We believe that
the legislature adopted the "in writingn portion of the statute to
deter tenants from claiming that they gave notice to the landlord
when they had not.    The "in writing" requirement is to assure that
the landlord was given notice and the opportunity to correct the
problem.   The case at bar is not one of these cases.       As stated
previously, Brandvold lived at the facility and witnessed the
defects and problems first hand; he obviously had actual notice of
all the aforementioned problems.       The Health Department was also
involved on various occasions relating to the unsanitary sewage and
water conditions of the trailer court. The testimony of one of the
owners, Harold Magruder (Magruder) is riddled with the words I1I
don't recallu when asked for any specificity or detail on almost
any issue. He was particularly elusive about the notice issue and
even went so far as to state repeatedly that he was not aware of
the complaints because they were not in writing due to Brandvoldls
failure to relate the complaints to him.
     Later, Magruder reluctantly conceded that he was aware of some
of the problems and that eight of the tenants were complaining.
Further, Magruder testified that he did get written notice from the
Health Department about the condition of the trailer court:
     Q.  Clean and safe. Was it [the trailer court] clean
     according to the pictures of the refuse piled around all
     of the dumpsters?
     A. Well, if that -- those pictures coincided with the
     date of the rental agreement, no.
     Q. Wasn't the water unsafe in August of 1985?      Wasn't
     there a boil order in effect?
     A. If that's what it [the letters from the Missoula
     County Health Department] says, yes.
     Q. And didn't Mr. Xikkert [the County's environmental
     health specialist], several times, say that there were
     serious sanitary problems going on at the trailer court?
     A.   Just that one mention in that one here.
     Q.  Well, I recall three letters by Mr. Kikkert
     indicating that there were sanitation problems there.
     A.   Caps.
     Q.  That's not exactly what he said.     Didn't he talk
     about serious health hazards? Do you want to look at the
     exhibits again?
Magruder's   testimony   is   fraught with   inconsistencies; after
claiming that he had no knowledge of the problems he then testified
that the sewer repair people were out at the trailer court trying
to fix the problems on a daily basis.    Magruder also attempts to
create yet another escape route stating that he told Brandvold to
tell the tenants that if they had a serious complaint they should
bypass Brandvold and speak directly with the owners.
     We find it particularly egregious that the landlords then,
with knowledge of the many problems, would present for the tenants'
signatures the lease agreement containing a statement of condition
which was untrue, let alone emphasize that the tenants refused to
sign the new lease as some example of their uncooperativeness. T h e
clause read as follows:
     8. Condition: Lessee agrees and stipulates that Lessee
     has examined the premises, including the grounds,
     buildings, and improvements, and that they are, at the
     time of this rental agreement, in good order and repair,
     and in a safe, clean and tenantable condition.
     Under these circumstances, we will not allow the landlords to
escape their responsibility by claiming that they were never
notified.   There was actual notice under   §   70-24-108, MCA.

     In directly addressing the habitability issue, we note that a
major but absent character in this lawsuit is Brandvold.          He was
the on-site manager of the trailer court and, in theory, the
conduit through which all information traveled between landlords
and tenants.     The record     indicates that Brandvold was         not
accountable to   :either the tenants   :or the landlords in almost
every action that took place. Brandvold also violated his own rule
of "no junk vehicles in the trailer courtu by himself repairing,
dismantling and parking vehicles in various stages of disrepair at
the trailer court site.       A careful review of the record also
indicates that due to the recurring nature of the problems and the
fact that Brandvold did little or nothing about the complaints, the
tenants obviously felt a sense of futility, many of them indicating
that making a complaint to him was in vain.      Further, when tenants
did complain many of them testified that they were met with threats
of eviction from Brandvofd.
     While we sympathize with the landlords1 apparent misfortune in
relying     on a manager who only paid "lip servicetg to their
instructions and directives, they still must be held accountable
for his actions or inactions. In this light, we note that Magruder
also testified that he hired          Brandvold without knowing his
employment history or taking an application for employment from
him.
       Q.  Okay.   And you hired Mr.        Brandvold then as the
       trailer court manager.
       A.   Yes.
       Q.   What did you know about Mr. Brandvold?
       A.   Not a great deal.
       Q. And is that -- has something to do with the fact that
       you can't find him?    Did you ever get an employment
       history from him?
       A.   No.
       Q.   Take an application from him.
       A.   No.    We just talked to him.
       Citing the fact that the trailer court license was never
revoked by the Health Department, the landlords characterize the
conditions that the tenants complained of as lfinconveniences.lv
However, raw sewage spilling onto the ground next to one's
dwelling, with its repugnant odors and health concerns, cannot
appropriately be described as merely an "inc~nvenience~~ can
                                                      nor
unsafe drinking water be placed into that category.       These issues
go directly to the habitability of the trailer court and no amount
of creative verbiage can subvert the conclusion that the trailer
court was not in a habitable condition.
       With regard to the contamination of the water at the trailer
                                     9
court,     the       environmental     health      specialist     Douglas    Kikkert
(Kikkert),       said     that   he    was    not     sure   of   the    source    of
contamination.          Further, trailer court tenant Mrs. Amundson, and
other tenants, testified that they were never notified by landlords
that the boil order was lifted and that they could resume normal
consumption of the water.             This fact was corroborated by Magruder
when he yet again assigned responsibility to Brandvold for not
informing the tenants that the boil order was lifted.
      Numerous witnesses testified to the unhabitable condition of
the trailer court. Ms. Cora Linn resided in the trailer court from
May   1985       to    June   1986    and    her    testimony     is    particularly
illustrative.
      Q. What was the condition of the trailer court at the
      time that you first moved into it?
      A.   It was a mess
      Q.  Could you describe the             --   what you mean by the word
      "mess?"
      A. Raw sewage. Toilet paper. Uncapped sewers.                         Open
      well hole full of water around a child's trailer.                     Yes,
      it was a mess.


      Q.   What kind of problems did you have?
      A. Right by my front door was a hole by a tree, and it
      was raw sewage and fumes that made me sick . the hole     . .
      was about a half a foot wide when I moved in. When I
      left it was a foot wide, and it was nasty.


      Q. .       .
               . Now this sewage backing up, could you tell
      where it was coming from?
      A.  From down in the ground past the tree trunks. It was
      just there.
Q.   There was no pipe there that you could see.
A.   I couldn't see nothing but a hole.

Q.  Did you mention that particular problem to Mr.
Brandvold?
A.   Yes.
Q.   And what did he tell you?
A.   Ha, ha, ha.    [To] put dirt on it.
Q.   And did you do that?
A.   Yes.
Q.   And what was the result?
A.   The hole got bigger.

Q.   How often would you have to fill that hole with dirt?
A. Once every month      .     .
                       . it grew an inch, inch and a
half, each time you filled it up.
Q.   Okay.    How deep was it?
A. Deep. I could put a stick in it and come up this
deep with it. I don't know how much that would be.
Q.   You indicated about maybe more than a foot.
A.   More.

Q.  Okay.     And to whom did you complain about that sewer
problem?
A.   To the manager [Brandvold].
Q.   And his response was what?
A.   Ha.     Put dirt in it.   It will dry up.


Q. Were there any other dangerous conditions at the
trailer court?
A. Yes, that little dot right in the top up there was
open.
    Q.     You're referring to the main sewer riser.
    A.   That's right. And there was a little baby hanging
    over the edge, and I got that baby, took him in his
    trailer. I went down to the manager and I said, "Cover
    this, or X 1 m going to the police," He said, "Bitch all.
    the way down there.    He put a piece of board and a rock,
    and he said, "Don't bother me no more. I don t care who
    dies. l1


    Q.  You had complaints, Ms. Linn, about the odor   and the
    appearance of the sewage. The sewage disposal      system,
    the drains, and toilets in your trailer worked     for the
    entire 14 months that you lived there, did they    not?
    A.. No.
    Q.     Were they stopped at some point?
    A.     They backed up a lot.   I had   --
     Q.    How many times?
    A.   I counted six times I had to use snakes to unplug my
     toilet so I could flush it. When I did it came out of
     the ground on the other side of the lot.
     Also, tenant Richard Schwarz testified that "[olne day the
sewage backed up to the point to where it came up through my
bathtub lines, all the way underneath my trailer, and came up and
knocked my bottom pipe down, and it was squirting out of the ground
behind my trailer.'! The extent of Brandvoldls attempt to correct
the problem was that he threw lime underneath Schwarzfs trailer.
A similar rendition was testified to by Dorienne Amundson as
follows:
     Q. Okay. Were you present in the trailer court when
     Richard Schwarz s neighboring vacant lot bubbled up with
     sewage?
     A.    Yes, I was.
     Q.    And what steps did Brandvold take to alleviate that
    situation?
    A.    He threw lime on it.
    Q.    Did he do any cleanup of the place?
    A,    None.
    Q. How about all those sewer risers in Exhibits 5, 6,
    and 7? Did he do anything to clean up the garbage that
    was around it?
    A.    No.     He left it there.
    Mr. Greg Filori also testified to the sewage and uncleanliness
of the trailer court as follows:
    Q. Did you have any problems with the sewage system
    where you lived in River Road Trailer Court?
    A.    Yes.     There was open pipe by the trailer.
     Q.  There was an open pipe by the trailer, and what did
     that do?
    A.   It kind of seeped up through the ground by the tree.
     You can smell it.
     Q.   What seeped up?
     A.   The sewage.


     Q. Okay. Were the common areas and the grounds around
     your particular residence whexe you lived, were they kept
     in a clean -- clean and safe manner by management?
     A.   No.

     Q. Did they keep the weeds and water puddles and what
     not removed?
     A.   There was quite a few weeds there.


     Q.   . . . were they   [the weeds] ever trimmed or cut back?
     A.   No.
     Q. Do you know if the common areas of the trailer court
     were ever watered or the grass mowed?
     A.   I didn't see [the grass] mowed.
     Garbage services were also problematic when, after constant
complaints about the inadequate size of the dumpsters, larger ones
were temporarily installed and Brandvold himself filled them with
d e b r i s from his construction business, which was unrelated to the

trailer court.
     The landlords also tout that they were never in any violation
of health codes as administered by the Health Department. However,
we have reviewed the reports and testings made by the Health
Department and have discovered the following warning in the reports
when the results proved to be qlnoncontaminated.gq
     The laboratory examination of this sample showed no
     evidence of contamination. This indicates that, as far
     as can be determined by a laboratory examination, the
     water was safe for drinking at the time the sample was
     taken. However, these results cannot be relied upon as
     indicating the safety of the water at all times unless
     the source is properly located and maintained.
     Any well construction which does not positively exclude
     all surface and subsurface contamination must be
     considered as dangerous to health.      All dust, pump
     spillage, surface drainage, bird droppings, scrapings
     from one's shoes, etc. must be prevented from entering
     the well.
     The surface and subsurface contamination of concern and
reported by the tenants is exactly the type of contamination named
in the warning. Further, the Health Department's employee Kikkert
explained more clearly the meaning of water test results in his
deposition as follows:
     Q.   And how about the other one [sample]?
      A. And the next one, a sample taken by       ...
                                                    Brandvold
      shows contamination with no coliform bacteria.
      Q.   What would that mean?
      A. That the particular multiple tube fermentation media
      was able to grow something, but not coliform bacteria.
      The laboratory problem there is that whatever's growing
      may have crowded out what we wanted to test for and the
      coliform bacteria and not allowed it to grow, so it's
      marked as no coliform bacteria, but the simple matter may
      be that another contaminate has crowded it out and not
      allowed it to show up on our test.
      Due to the historical non-attentiveness of Brandvold, the
tenants chose not to believe news circulated by word of mouth that
the water was once again safe for consumption, particularly when
the septic problems had not been alleviated. The tenants logically
connected the contaminated water with the sewage leakage and based
their actions regarding whether to drink the water again on their
own observations.
      With this testimony in mind we examine existing case law.
First, in Corrigan v. Janney (1981), 192 Mont. 99, 102, 626 P.2d
838, 839, we indicated that by adopting the Residential Landlord

and   Tenant Act    of   1977, there    is   an   implied    warranty   of
habitability present in the landlord/tenant relationship.               In
Corricran, the tenants complained to their landlord after moving in
that when touching various portions of the plumbing system an
electric shock was received.       Mr. and Mrs. Corrigan, as well as
numerous guests, experienced such shocks and requested that the
landlord have the electrical system inspected.        It was also shown
that the previous tenant moved out because the landlord refused to
address the     electrical   problem.    The      landlord   did   nothing
throughout the Corrigans' tenancy, which lasted a year or more,
until Mr. Corrigan was killed by an electric shock while bathing.
    While Corriqan is an example of a severe result from a
landlord's failure to maintain rental property in a habitable
condition, it bears similarity to the case at bar.         There were
serious and ongoing problems that went unabated despite the
complaints of the tenants. In the case at bar the record indicates
that the sewer and water systems were problematic and there were
other conditions in the trailer court that were unclean and
dangerous. The fact that no one incurred a fatal accident because
of the lack of care exhibited by the landlords is irrelevant. The
instant case and Corriaan are identical in that the tenants
repeatedly made complaints about the unsafe and uninhabitable
conditions, all of which were either addressed inadequately or more
commonly not at all.
     In Busch v. Kammerer (1982), 200 Mont. 130, 649 P.2d 1339, a
tenant's only source of domestic water came via a garden hose
stretched from a neighboring house above ground. We indicated that
such a condition was grounds for a claim against the landlord for
a violation of the Residential Landlord and Tenant Act, which, as
stated   in     Corriaan,   encompasses   an   implied   warranty   of
habitability.
     Corriaan and Busch perpetuate the purpose and goals of the
Residential Landlord and Tenant Act and are helpful by giving us
examples of violations of the warranty of habitability.
     In the case at bar, the testimony of Magruder is particularly
revealing with regard to his true expectations of Brandvold in
maintaining or repairing the trailer court.
     Q.  And yet you expected him to handle all of the
     business of the River Road Trailer Court.
     A.   Oh, no.
     Q.   The majority of it?
     A. Just collecting the rent, and keeping the weeds cut
     down.
     The examples in Corrisan and Busch are similar to the case at
bar and we conclude that the landlords breached the warranty of
habitability.
     In reviewing the case at bar we also note the District Court's
inconsistent treatment of the habitability issue. For instance, in
the court's findings of fact and conclusions of law that spanned 26
pages, the court said:
     The Court specifically finds that the River Road Trailer
     Court was not clean nor were the grounds, buildings and
     improvement[s] steadily in good order and repair.
Also the court found that the landlords failed to engage in cleanup
activity after tenants vacated the premises, yet the court ruled in
favor of the landlords and stated that the landlords met their duty
to maintain the premises, and that they took steps to remedy the
problems.
     Also, after the court recited the condition of the trailer
court and the ongoing nature of the problems,          it used   the
adjectives "inconvenienced" and "discomfortw to describe what these
tenants experienced.     As mentioned previously the record does not
support this characterization.
     The tenants in the case at bar contended with ongoing serious
violations of habitability standards few of which were addressed by
the landlords in a timely manner, if at all.   After reviewing the
record we are left with the definite and firm conviction that a
mistake has been committed under the third prong of the three-part
test we adopted in DeSave, 250 Mont. at 323, 820 P.2d at 1287, when
the District Court determined that the landlords did not breach the
warranty of habitability. We conclude that the landlords failed to
adequately maintain the trailer court in a habitable manner and
breached the warranty of habitability.   Therefore, we reverse and
remand to the District Court for further proceedings consistent
with this opinion.   Reversed.




We concur:
