Opinion ID: 662404
Heading Depth: 2
Heading Rank: 3

Heading: Measurement of Damages

Text: 21 Plaintiffs sought a rent reduction as their remedy for breach of the implied warranty of habitability. The ordinary method of measuring damages is to compute the difference between the amount of rent each tenant has paid and the actual market value of the premises in as-is condition. This formulation compensates the tenant for having paid too much because of the landlord's breach. In this case, however, the district court used a different method. Because Tyler House is federally subsidized, each tenant pays only a portion of her rent; HUD pays the rest. Defendants' method of computing damages (which assumed that any overpayment was HUD's overpayment, and not the tenants') would leave many tenants with nothing. 22 Therefore, the district court rejected the defendants' method as inequitable. Instead, it accepted the plaintiffs' alternative method of percentage reduction, whereby the jury was asked to calculate the percentage by which the breach reduced the plaintiffs' rental obligations. The jury decided that the rent should be reduced by 87 percent, and each tenant therefore recovered 87 percent of the rent she personally paid, regardless of the HUD subsidy. 23 If the tenants had been paying the entire rent, there would be no dispute about damages: defendants would be on the hook for the entire cost of the breach--considerably more money than they are paying here. Because these tenants are subsidized, and because HUD is not a party to this case, defendants' method of recovery would allow them to pay even less, thereby evading the obligation to make full restitution to the victims of their Housing Code violations. Indeed, under defendants' method of computing damages many of the tenants who suffered from the deplorable conditions at Tyler House would recover nothing at all. The Superior Court has rejected a similar argument on one occasion, applying a percentage remedy in an analogous case. Multi-Family Management, Inc. v. Hancock, 121 Daily Wash.L.Rptr. 837 (D.C.Super.Ct.1993) (percentage remedy is a fair and equitable resolution). Therefore, the percentage remedy is not only more equitable, but it is also the law of the District of Columbia. 24 Defendants further argue that the district court erroneously excluded their proffered expert testimony. The expert appraiser would have testified to the as-is market value of units in similar projects. But the expert never visited Tyler House; he offered only to testify to the value of other projects that may have been similarly situated. Not having seen the conditions at Tyler House, he could not testify accurately as to the value of the apartments there. Consequently, the district court could reasonably exclude the testimony for inadequate foundation. The only issue here was the percentage reduction in value of the units at Tyler House itself, and the expert's grasp of that issue was materially compromised. Accordingly, the district court properly exercised its discretion to exclude the appraiser's testimony.