IN THE SUPREME COURT OF IOWA

No. 15–1348

Filed May 19, 2017

Amended July 19, 2017

JOAN WALTON,

Appellee,

vs.

MARTIN GAFFEY,

Appellant.

Appeal from the Iowa District Court for Johnson County, Patrick R. 

Grady, Judge.

A landlord appeals a district court’s ruling on summary judgment 

that certain lease provisions are prohibited under the Iowa Uniform 

Residential Landlord and Tenant Act and that certified a class of tenants. 

AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.

James W. Affeldt and Nicholas J. Kilburg of Elderkin & Pirnie, 

P.L.C., Cedar Rapids, for appellant.

Christopher Warnock of The Iowa Tenants’ Project, Iowa City, and 

Christine Boyer of The Iowa Tenants’ Project, Iowa City, for appellee.
2

HECHT, Justice.

A tenant brought this action alleging her lease included several 

provisions known by the landlord to be prohibited under the Iowa 

Uniform Residential Landlord and Tenant Act (the Act). Claiming status 

as an appropriate representative of other similarly situated residential 

tenants, the tenant requested certification of a class. On interlocutory 

appeal challenging a summary judgment in favor of the tenant and an 

order certifying a class of tenants, the landlord contends (1) the lease 

provisions are not prohibited under the Act; (2) the tenant has no claim 

for damages because even if the lease provisions are prohibited under the 

Act, the landlord did not enforce them against the tenant; and (3) the 

district court erred in certifying the class. Upon review, we conclude 

some, but not all, of the challenged lease provisions are prohibited under 

the Act and we reverse and remand on class certification. 

I. Background Facts and Proceedings.

Tenant Joan Walton entered into a rental agreement with landlord 

Martin Gaffey on March 14, 2014, for a lease term that ended on July 29, 

2015. The agreement included provisions imposing fees, charges, and 

liquidated damages in the event of various occurrences. Paragraph 7 

prescribed a charge of $35 if the tenant’s check was returned for 

insufficient funds. Paragraph 8 imposed a “processing administrative 

fee” of $35 for “issue and service of each 3-DAY NOTICE TO PAY UNPAID 

RENT.” Paragraph 12 established an administrative fee of $40 if the 

tenant failed to register utilities in her name. Paragraphs 13 and 27 

prescribed a fee in the same amount in the event the tenant failed to 

keep the utilities registered in her name until the end of the lease term. 

A fine of $500 was imposed under paragraph 22 of the agreement if the 

tenant was “caught smoking in [the] dwelling unit or interior common 
3

area” of the property. Service calls precipitated by noise complaints, 

trash removal, parking violations, unauthorized pets, or posting notices 

to the tenant would result in a “minimum trip charge” of $50 payable by 

the tenant under paragraph 24 of the agreement. A minimum service 

charge of $50 was established in paragraph 25 in the event the tenant 

was locked out of the abode and requested the landlord’s assistance in 

regaining access after normal working hours. An administrative fee of 

$40 for each new approved occupant and a fee of $100 for each 

unapproved new occupant were prescribed in paragraph 26. A fee of 

$200 was charged in paragraph 27 in the event the tenant should 

sublease the unit. A fee of $500 for keeping an unauthorized animal in 

the unit was established under paragraph 28 of the agreement. A fee of 

$100 was imposed in paragraph 37 for each inspection attempted by the 

landlord as a result of the tenant’s failure to vacate the premise after

termination of the agreement.

The agreement also included provisions purporting to limit the 

landlord’s liability or exculpate him entirely for some types of damages or 

losses. For example, paragraph 16 provided as follows:

Subject to other remedies at law, if LANDLORD is unable to 

give TENANT possession at the beginning of the term, the 

rent shall be rebated on a pro rata basis until possession 

can be given, which rebated rent shall be accepted by 

TENANT as full settlement of all damages occasioned by said 

delay, and if possession can not be delivered within ten days 

of the beginning of said term, this lease may be terminated 

by giving prior written notice of such termination.

Paragraph 20(e) addressed the landlord’s liability for appliance failures. 

This provision provided in relevant part:

In the event of the failure of an appliance that is furnished 

by LANDLORD under this rental agreement, LANDLORD’S 

sole responsibility shall be the repair or replacement of the 

appliance at the LANDLORD’S sole discretion. In no event or 
4

circumstance will LANDLORD be responsible for any loss of 

use or consequential damages caused by said appliance 

failure.

Paragraph 23 of the agreement further provided that “LANDLORD shall 

not be liable for damage or loss of any of the TENANT’S personal property 

for any cause whatsoever.”

The agreement also addressed the subject of carpet cleaning. 

Paragraph 29 provided in relevant part that “LANDLORD shall have all 

carpeting professionally shampooed, paid out of tenants security 

deposit.”1 

Walton filed this action against Gaffey seeking a declaration that 

each of the lease provisions mentioned above violated the Act. In 

particular, Walton alleged the provisions imposing fees, charges, and 

liquidated damages in the event of various occurrences violated Iowa 

Code sections 562A.11(1), 562A.27, and 562A.32 (2015) because a 

landlord may recover only actual damages under the Act. Walton’s 

petition further asserted the various provisions limiting or exculpating 

Gaffey’s liability violated section 562A.11(1). In addition, the petition 

alleged the lease provisions allocating to her the cost of carpet cleaning 

are prohibited under the Act because they purport to impose the cost of 

carpet cleaning whether or not cleaning was necessary to restore the 

dwelling to its condition at the commencement of the lease, ordinary 

wear and tear excepted, and because they authorized withholding the 

cost of such cleaning from the security deposit.2 The petition sought 

 1Gaffey’s “Tenant Rules and Regulations” also addressed the subject of carpet 

cleaning, stating that the “[c]arpet has been cleaned prior to move-in and is required to 

be cleaned at move out and at TENANT’S expense only by approved or authorized firms. 

At time of move-out a copy of the receipt for cleaning is to be provided to LANDLORD.”

2Although Walton’s petition challenged other lease provisions as well, we confine 

our discussion to those provisions that were addressed in the district court’s summary 

judgment ruling. 
5

judgment for actual and punitive damages, injunctive relief, and attorney 

fees. Gaffey’s answer denied the agreement’s provisions violate the Act 

and urged dismissal of the action. 

A. Motion for Partial Summary and Declaratory Judgment. 

Walton filed a motion for partial summary and declaratory judgment. 

The motion sought a declaration that the above-mentioned lease 

provisions imposing charges, fines, penalties, liquidated damages, or 

other fees are prohibited because, Walton contended, a landlord can 

recover only actual damages from tenants under the Act. Walton further 

urged the court to enter summary judgment declaring that the lease 

provision imposing an automatic carpet-cleaning charge and withholding 

it from her security deposit violates the Act.3 Walton’s motion also 

sought a summary declaration that paragraphs 20 and 23 of the lease 

violate section 562A.11(1)(d) of the Act because they purport to limit or 

exculpate Gaffey’s liability arising under law. In addition, Walton urged 

the court to declare that Gaffey is liable under the Act as a matter of law 

for willfully using the prohibited lease provisions even if he did not 

attempt to enforce them against her. 

In his resistance to the tenant’s motion for partial summary 

judgment, Gaffey contended the contested provisions are neither 

prohibited under Iowa Code section 562A.11(1) nor unconscionable 

under section 562A.7(1)(a). In the alternative, Gaffey asserted that 

Walton has asserted no claim that is ripe for adjudication because the 

 3Walton’s motion for summary judgment asserted that whether the cost of 

carpet cleaning is withheld from her security deposit or paid to an authorized cleaner, 

the Act does not permit Gaffey to impose—without inspection—the cost of cleaning a 

carpet that is not in need of cleaning. 
6

challenged provisions were not enforced against her.4 The landlord 

further asserted that even if any of the challenged provisions is 

determined to be prohibited under the Act, the record does not support a 

finding that he willfully used it with knowledge of its prohibition. Based 

on these assertions, Gaffey urged the motion for summary judgment be 

denied. 

B. Motion for Class Certification. Walton also filed a motion 

requesting she be certified as representative of a class consisting of all of 

Gaffey’s tenants who signed “the same or substantially similar standard 

leases and lease rules.”5 The motion requested the court adjudicate for 

the entire class (1) whether the terms of the lease violated the Act, and 

(2) whether Gaffey knowingly and willfully used a rental agreement 

containing prohibited provisions. 

Gaffey resisted the certification of the proposed class of tenants, 

contending Walton is not a proper representative of the purported class 

because the challenged lease provisions were not enforced against her. 

Contending Walton has suffered no injury as a consequence of the 

inclusion of the challenged provisions in the lease agreement, Gaffey 

posited that Walton lacks standing to proceed with her claims and is 

therefore not a proper class representative. Certification should also be 

denied in this instance, Gaffey asserted, because individual claims and 

defenses predominate over common issues across the putative class. 

 4In an affidavit filed in support of his resistance to the motion for summary 

judgment, Gaffey attests that he does not invoke the carpet-cleaning provision in every 

case and instead makes a case-by-case determination whether cleaning is required.

5Gaffey has admitted in this case that the lease provisions that are the subject of 

this case were part of his rental agreements with more than fifty tenants. 
7

C. District Court’s Summary Judgment Ruling. The district 

court granted Walton’s motion for partial summary judgment. Reasoning 

that Gaffey owes his tenant a duty of due care to protect them from 

injury, the court declared that paragraph 20(e) (limiting landlord’s 

liability for any loss of use or consequential damages arising from 

appliance failure) and paragraph 23 (landlord not liable for damage or 

loss of any of the tenant’s personal property for any cause whatsoever) of 

the agreement purport to exculpate or limit the landlord’s liability in 

violation of Iowa Code section 562A.11(1)(d). 

The district court further concluded the lease provisions imposing 

the fees, charges, and liquidated damages detailed above were prohibited 

under the Act. Citing our decision in D.R. Mobile Home Rentals v. Frost, 

545 N.W.2d 302 (Iowa 1996) (per curiam), the district court concluded 

the Act allows landlords to recover only actual damages from their 

tenants. Because the fees, charges, and liquidated damages were set 

“without any consideration of what the landlord’s actual damages and 

fees would be in each situation,” the court concluded the lease provisions 

violate the Act.

The court also decided the carpet-cleaning provision was 

prohibited under the Act because it automatically imposed on Walton a 

fee without regard to whether the carpet was clean at the end of the lease 

term and because it authorized Gaffey to withhold the cost of the 

cleaning from the security deposit without proof that such cleaning was 

necessary to restore the dwelling unit to its condition at the 

commencement of the tenancy, ordinary wear and tear excepted. The 

court concluded, however, that the question of whether Gaffey willfully 

used the prohibited provisions is a disputed question of fact for the fact

finder. 
8

In reaching its summary judgment conclusions, the district court 

relied on an unpublished decision of our court of appeals in Staley v. 

Barkalow, No. 12–1031, 2013 WL 2368825 (Iowa Ct. App. May 30, 2013).

In Staley, the plaintiffs were tenants who alleged their landlord used 

several lease provisions prohibited under Iowa Code section 562A.11(1). 

Staley, 2013 WL 2368825, at *2. The tenants in that case challenged the 

lease provisions on the grounds they constituted illegal indemnity and 

exculpatory clauses, required tenants to pay rent even if the landlord 

failed to deliver possession of the premises at the commencement of the 

lease term, and illegally required tenants to pay for maintenance and 

repair of the premises, carpet cleaning, and property damages caused by 

third-party vandals. Id. at *2–3. The defendant landlord contended it 

had no liability to the tenants under chapter 562A for lease provisions 

that were included in the lease but not enforced. Id. at *4–5. The district 

court denied the Staley tenants’ motion for partial summary judgment, 

concluding the landlord had no liability to the tenants under section 

562A.11(2) for including any lease provisions that were not enforced 

against them, and denied a motion to certify a class of similarly situated 

plaintiffs. Id. at *5–6. Our court of appeals reversed, concluding a 

landlord “willfully uses” a lease provision prohibited under the Act by 

willfully including it in a lease. Id. at *8. The court of appeals also found 

the district court abused its discretion in refusing to certify the class of 

tenants. Id. at *12.

We granted Gaffey’s application for interlocutory review. 

II. Scope and Standards of Review.

The relevant scope and standards of review are detailed in another 

of this court’s opinions, filed today. In Kline v. Southgate Property 

Management, L.L.C., a case involving similar issues, we said,
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Generally, our standard of review for a declaratory 

judgment ruling depends on whether the action was tried at 

law or in equity in the district court. When we review a 

declaratory ruling entered on summary judgment, however, 

our scope of review is for correction of errors at law. 

Summary judgment rulings based on statutory 

interpretation are reviewed for correction of errors at law. 

We review a district court’s rulings on certification of a 

class for an abuse of discretion. The district court “enjoys 

broad discretion in the certification of class action lawsuits.” 

Iowa’s “class-action rules are remedial in nature and should 

be liberally construed to favor the maintenance of class 

actions.” A district court abuses its discretion when its 

“grounds for certification are clearly unreasonable.” 

895 N.W.2d 429, 436 (2017) (citations omitted) (first quoting Legg v. W. 

Bank, 873 N.W.2d 756, 758 (Iowa 2016) and then quoting Anderson 

Contracting, Inc. v. DSM Copolymers, 776 N.W.2d 846, 848 (Iowa 2009)).

III. Analysis.

We first address Gaffey’s contention that the district court erred in 

concluding a tenant against whom a rental agreement provision has 

never been enforced has standing to sue her landlord under chapter 

562A. We then turn to Gaffey’s alternative contention that even if such a 

tenant could have standing to challenge a prohibited rental agreement 

provision, the district court erred in concluding any of the provisions 

assailed by Walton are prohibited under section 562A.11(1). Lastly, we 

address Gaffey’s assertion that the district court abused its discretion in 

certifying a class of tenants in this action.

A. Standing. Because it is undisputed that he has made no 

attempt to enforce the challenged lease provisions against Walton, Gaffey 

argues the summary judgment record is devoid of evidence of any 

injurious effect necessary to sustain standing to sue. Accordingly, Gaffey 

suggests, Walton’s claims in this case are purely hypothetical or 

academic—not concrete, ripe, and justiciable. We rejected these 
10

arguments in Kline and reject them here for the same reasons. See

Kline, 895 N.W.2d at 436–37.

B. Fees, Charges, and Liquidated Damages Provisions. The 

district court concluded all of the challenged fees, charges, and 

liquidated damage provisions in the leases are prohibited under the Act 

“because they were set without any consideration of what the landlord’s 

actual damages and fees would be in each situation.” As we have already 

noted, the district court reached this conclusion because it believed our 

decision in Frost required it. See Frost, 545 N.W.2d 302. Gaffey 

contends reversal is required on this issue because the fees, charges,

and liquidated damages provisions challenged by the tenant in this case 

are not prohibited under the Act. We resolved this issue in the landlord’s 

favor in Kline. For the reasons we articulated there, we conclude the 

summary judgment ruling in Walton’s favor on this issue must be 

reversed. See Kline, 895 N.W.2d at 441.

As in Kline, however, we emphasize that 

the district court did not decide whether any of the fees, 

charges, and liquidated damage provisions challenged in this 

case by the tenants are unconscionable under section 

562A.7 or unenforceable penalties under any other principle 

of law or equity supplementing the Act. 

Id. at 442. Accordingly, those issues remain for resolution in 

proceedings on remand. 

C. Carpet-Cleaning Provision. The district court concluded the 

carpet-cleaning provision in paragraph 29 of Gaffey’s rental agreement is 

prohibited because it provides for automatic cleaning whether the carpet 

needs cleaning or not and authorizes withholding of the cost of such 

cleaning from the security deposit. Gaffey contends the district court 

erred on this issue because the record demonstrates the provision is not 
11

automatically invoked against tenants and because it is properly 

understood as the parties’ expression of their expectations of cleanliness 

at the beginning and end of the lease term. In other words, Gaffey 

explains, the professional carpet-cleaning requirement ensures the 

carpet is returned to the condition it was in at the commencement of the 

lease term, ordinary wear and tear excepted. See Iowa Code 

§ 562A.12(3)(a)(2) (permitting withholding such amounts from a security 

deposit as are reasonably necessary “[t]o restore the dwelling unit to its 

condition at the commencement of the tenancy, ordinary wear and tear 

excepted”). 

We addressed the legality of an automatic carpet-cleaning 

provision in a residential rental agreement in De Stefano v. Apts. 

Downtown, Inc., 879 N.W.2d 155 (Iowa 2016). The agreement in that 

case provided,

The carpets throughout the building are professionally 

cleaned each time apartments turn over occupancy. Tenants 

agree to a charge starting at $95 (efficiency) not to exceed 

$225 (6+ bedrooms) being deducted from the deposit for 

professional cleaning at the expiration of the Lease.

Id. at 160. We decided that the provision conflicted with the Act because 

“it generates an automatic deduction from the rental deposit even when 

none of the conditions of section 562A.12(3) have been met.” Id. at 185. 

We acknowledged in De Stefano, however, that Iowa Code section 

562A.12 “clearly authorizes the deduction of carpet-cleaning costs from 

rental deposits if necessary to restore the dwelling to the condition at the 

commencement of the tenancy, beyond the ordinary wear and tear.” Id. 

at 186. We expressly left room for the possibility that “a landlord may be 

able to impose a nonrefundable charge on tenants for automatic carpet 

cleaning” not affecting the rental deposit. Id.
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In Kline, we concluded the district court erred in declaring the 

landlord’s carpet-cleaning provision was prohibited under section 

562A.12(3). We reasoned that the language of the rental agreement in 

that case was not reasonably understood as an authorization for 

automatic withholding of the cost of carpet cleaning from a security 

deposit. It was, we concluded, instead “a provision establishing a 

benchmark for the condition of the carpet—a clean carpet—at the 

commencement of each tenancy from which subsequent assessments of 

ordinary wear and tear can be measured.” Kline, 895 N.W.2d at 444; see 

also De Stefano, 879 N.W.2d at 186. 

In this case, the carpet-cleaning provision in paragraph 29 of 

Gaffey’s rental agreement with Walton provides: “Landlord shall have all 

carpeting professionally shampooed, paid out of tenants’ security 

deposit.” It authorizes the landlord to undertake professional carpet 

cleaning and deduct the cost from the security deposit without regard to 

whether the cleaning is necessary to restore the carpet to its condition at 

the commencement of the tenancy. We think this provision is more like 

the carpet-cleaning provision in De Stefano than the one in Kline. 

Accordingly, we affirm the district court’s determination that the carpetcleaning provision in paragraph 29 is unenforceable under law. See

De Stefano, 879 N.W.2d at 186. Our confidence in the conclusion that 

the subject provision is unenforceable is not diminished by the 

undisputed fact that Gaffey made no effort to enforce the provision 

against Walton; neither is it diminished by Gaffey’s assertion—supported 

by substantial evidence in the summary judgment record—that he 

exercises discretion in enforcing the provision and only does so when 

necessary under the circumstances. As written, paragraph 29 amounts 

to an agreement by Walton to waive her right to insist that Gaffey 
13

withhold from the security deposit only such amounts as are reasonably 

necessary to restore the carpet to its condition at the commencement of 

the tenancy, ordinary wear and tear excepted. See Iowa Code 

§ 562A.12(3)(a)(2). We therefore affirm the district court’s conclusion 

that the carpet-cleaning provision in paragraph 29 of the rental 

agreement is a prohibited provision.6 See id. § 562A.11(1)(a).

D. Certification of the Class. Gaffey contends the district court 

made both procedural and substantive errors in certifying the class of 

tenants. In certifying the class, the district court again relied on the 

decision of the court of appeals in Staley, a case brought by tenants 

making similar claims against a different landlord. Staley, 2013 WL 

2368825, at *10. Gaffey contends the district court in this case relied 

solely on the certification decision in Staley and assumed—without 

performing an independent analysis and making findings of fact as to the 

substantive criteria for class certification—that certification is 

appropriate in this case and Walton is a suitable representative of the 

class. 

Today we reversed the certification of a class of tenants in Kline. 

See Kline, 895 N.W.2d at 432–33. The certification of a class in this case 

is procedurally flawed for the same reasons and must therefore be 

reversed. As in Kline, however, our ruling should not be understood as a 

determination that Walton cannot establish the grounds for certification 

 6We acknowledge that under Gaffey’s tenant rules, Walton could avoid the 

deduction of the cost of mandatory carpet cleaning from the security deposit by hiring a 

professional approved by Gaffey to undertake the cleaning and by providing a receipt 

evidencing payment for the service. We conclude, however, that the provision still 

violates the Act. An unauthorized deduction from the security deposit does not become 

authorized merely because the tenant can avoid it by making a separate payment.
14

of a class. On remand, the court should make the findings required 

under Iowa Rule of Civil Procedure 1.263(1).

IV. Conclusion.

We affirm the district court’s declaration that paragraphs 20(e), 23,

and 29 of Gaffey’s rental agreement constitute prohibited provisions. We 

reverse the district court’s declaration that the other lease and rule 

provisions challenged by Walton are categorically prohibited. We also 

reverse the class-certification ruling and remand for further proceedings.

AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.