Court Opinion

ID: 9900458
Source: CourtListenerOpinion
Date Created: 2023-11-18 22:13:14.439503+00
Date Added: 2024-06-11T09:21:05.648817
License: Public Domain

No. 254               May 17, 2023                      1

          IN THE COURT OF APPEALS OF THE
                  STATE OF OREGON

              KKMH PROPERTIES, LLC,
                 Plaintiff-Respondent,
                           v.
                  Michael P. SHIRE
                and all other occupants,
                 Defendant-Appellant.
               Lane County Circuit Court
                 21LT01841; A176826

  Jay A. McAlpin, Judge.
  Argued and submitted April 5, 2023.
  Harry Ainsworth argued the cause and filed the brief for
appellant.
   Brian D. Cox argued the cause for respondent. Also on
the brief was Law Offices of Brian Cox.
  Before Tookey, Presiding Judge, and Egan, Judge, and
Kamins, Judge.
  TOOKEY, P. J.
  Affirmed.
2                                KKMH Properties, LLC v. Shire

          TOOKEY, P. J.
         In this forcible entry and detainer (FED) action
seeking restitution of possession of a residential dwelling
unit, defendant, the tenant, appeals from a judgment award-
ing possession of the premises to plaintiff, the landlord, con-
tending that the trial court erred in denying defendant’s
motion to dismiss, because the notice of termination of the
tenancy did not include a notice of an opportunity to cure
the violation of the rental agreement. Defendant’s assign-
ments of error relate to the trial court’s denial of defendant’s
motion to dismiss based on plaintiff’s failure to give the
required notice or the sufficiency of the evidence relating to
the ability to cure. We conclude that the trial court did not
err in denying the motion to dismiss and therefore affirm.
        The statutory context for the appeal is ORS 90.392,
which provides, in part:
        “(1) Except as provided in this chapter, after deliv-
    ery of written notice a landlord may terminate the rental
    agreement for cause and take possession as provided in
    ORS 105.105 to 105.168, unless the tenant cures the viola-
    tion as provided in this section.
       “(2)   Causes for termination under this section are:
       “(a) Material violation by the tenant of the rental
    agreement. * * *
       “* * * * *
       “(3)   The notice must:
       “(a) Specify the acts and omissions constituting the
    violation;
        “(b) Except as provided in subsection (5)(a) of this sec-
    tion, state that the rental agreement will terminate upon a
    designated date not less than 30 days after delivery of the
    notice; and
       “(c) If the tenant can cure the violation as provided in
    subsection (4) of this section, state that the violation can
    be cured, describe at least one possible remedy to cure the
    violation and designate the date by which the tenant must
    cure the violation.
Cite as 326 Or App 1 (2023)                                              3

      “(4)(a) If the violation described in the notice can be
   cured by the tenant by a change in conduct, repairs, pay-
   ment of money or otherwise, the rental agreement does not
   terminate if the tenant cures the violation by the desig-
   nated date. The designated date must be:
       “(A)   At least 14 days after delivery of the notice; or
      “(B) If the violation is conduct that was a separate and
   distinct act or omission and is not ongoing, no earlier than
   the date of delivery of the notice as provided in ORS 90.155.
   For purposes of this paragraph, conduct is ongoing if the
   conduct is constant or persistent or has been sufficiently
   repetitive over time that a reasonable person would con-
   sider the conduct to be ongoing.
      “(b) If the tenant does not cure the violation, the rental
   agreement terminates as provided in the notice.”

         The facts are largely undisputed. Plaintiff provided
defendant with a “for cause” notice of termination of a resi-
dential rental agreement, based on defendant’s material vio-
lation of the rental agreement in causing extensive damage
to the premises by allowing water to leak and having kept
277 uncaged guinea pigs.1 It is undisputed that the dam-
age to the premises included damage to the flooring, ceil-
ings, walls, cabinets, fixtures, appliances, trim, and other
portions of the premises. The notice of termination did not
provide defendant with an opportunity to cure the violation.
When defendant did not vacate the premises by the required
date, plaintiff brought this eviction action.
         Defendant sought to dismiss the action, asserting
that plaintiff’s notice of termination was invalid, because it
did not provide defendant with notice of an opportunity to
cure the violation. There was evidence that the anticipated
repairs would cost between $20,000 and $100,000. Although
defendant acknowledged that he did not have money to make
the repairs, he said that he hoped to be able to collect funds
from church friends. The trial court found that the dam-
ages to the premises were extensive, with the cost to repair
between $20,000 and $100,000, and that, although the
    1
      The guinea pigs had been removed from the premises at the time of the
notice.
4                           KKMH Properties, LLC v. Shire

premises were capable of “eventual restoration,” they were
not reasonably capable of being cured by defendant within
the minimum 14-day time period for cure that a landlord is
required to provide under ORS 90.392(4)(a)(A). Therefore,
the court held, the absence of notice of an opportunity to
cure the violations was excused.
         On appeal, plaintiff acknowledges that it did not
give the required notice of an opportunity to cure but asserts
that the notice was not required, because the violation was
not one that the tenant could cure. And defendant acknowl-
edges that he did not have the resources to make the neces-
sary repairs; but he contends that, under ORS 90.392, the
standard for determining whether a violation is one that can
be cured (so as to require notice of an opportunity to cure) is
whether the violation is “objectively” of a type for which an
opportunity to cure must be provided, because it is a viola-
tion that is capable of being cured through a “change in con-
duct, repairs, payment of money or otherwise,” as described
in ORS 90.392(4). In other words, in defendant’s view, cer-
tain damages—those that can be cured through the means
listed in ORS 90.392(4)—are curable as a matter of law.
Defendant contends that the trial court’s analysis incor-
rectly leaves the initial determination whether a violation
can be cured to the landlord, to determine “subjectively”
whether the violation is one that is capable of being cured
by the tenant. Defendant argues that, here, once the court
determined that the violations were of the type that could
be cured through “change in conduct, repairs, payment of
money or otherwise,” the court should have concluded that
the violation was curable as a matter of law and that the
notice was defective in failing to provide defendant with an
opportunity to cure. In the absence of the inclusion of notice
of such an opportunity, defendant contends, the notice was
invalid, and the trial court therefore erred in denying defen-
dant’s motion to dismiss. See Hickey v. Scott, 370 Or 97, 110,
515 P3d 368 (2022) (it is the landlord’s burden to “demon-
strate that it delivered a particular, valid notice that effec-
tively terminated the rental agreement”); Randall v. Valk,
324 Or App 251, 257, 525 P3d 889 (2023) (“A notice that fails
to comply with statutory requirements for its contents is
invalid.”).
Cite as 326 Or App 1 (2023)                                                     5

         Plaintiff responds that ORS 90.392 unambigu-
ously assigns to the landlord the “subjective” determination
whether the violation is curable. In this case, plaintiff con-
tends, the evidence supports the trial court’s determination
that the notice was not required, because the repair of the
damage was so costly and extensive that defendant could
not reasonably have cured the violations within the mini-
mum 14-day period that plaintiff would have been required
to give defendant under ORS 90.392.

         The parties’ arguments present a question of statu-
tory construction that we analyze pursuant to the methodol-
ogy described in State v. Gaines, 346 Or 160, 171-72, 206 P3d
1042 (2009), and PGE v. Bureau of Labor and Industries, 317
Or 606, 610-12, 859 P2d 1143 (1993), evaluating statutory
text in context, considering any helpful legislative history,
and turning to canons of construction as necessary.

         The parties do not dispute that it is the landlord
who must determine whether the violation is one that can be
cured so that the tenant must be given notice of an opportu-
nity to cure, and we agree that that is the correct reading
of the statute. The landlord makes the initial determina-
tion, subject to review by the court, whether the violation is
one that can be cured by the tenant.2 The parties describe
the disputed question of statutory construction as being
about how that determination is to be made by the land-
lord: whether ORS 90.392(3) and (4) state an “objective” or
a “subjective” standard for determining if the tenant can
cure the violation and when the notice of an opportunity to
cure must be given. Defendant argues that the standard is
“objective”—meaning that a tenant must be given notice of
an opportunity to cure if the violation is potentially curable
by one of the methods set out in ORS 90.392(4)(a). Plaintiff

     2
       Under ORS 90.392(3), it is the landlord who must provide notice (1) that the
violation can be cured; (2) how the violation can be cured; and (3) the length of
time available to cure the violation. And it is the landlord who determines, under
ORS 90.392(4)(a), whether the violation has been cured. If it is the landlord who
must provide notice that the violation is one that can be cured, how it may be
cured, the time within which it must be cured, and whether it has been cured,
necessarily, it must also be the landlord who makes the initial determination
whether the violation reasonably is one that can be cured by one of the means
listed in ORS 90.392(4).
6                           KKMH Properties, LLC v. Shire

responds that the standard is “subjective,” meaning that
the determination whether the tenant can cure the viola-
tion is one to be made by the landlord in the first instance,
depending, at least in part, on the particular tenant’s ability
to cure the violation by making the necessary repairs.
         As we view it, the question is not so much about
whether the determination is “objective” or “subjective,”
per se, but about under what circumstances ORS 90.392(3)
and (4) require that a tenant be provided with notice of an
opportunity to cure. ORS 90.392(3) states that the require-
ment for the landlord to give notice (1) that the violation
can be cured, (2) of a possible remedy for the cure, and
(3) the date by which the cure must occur, arises only “[i]f the
tenant can cure the violation as provided in subsection (4).”
ORS 90.392(3)(c) (emphasis added). ORS 90.392(4)(a), in
turn, states that if the violation can be cured by the tenant
by a “change in conduct, repairs, payment of money or other-
wise,”—by, essentially, any means—the rental agreement
does not terminate, if the tenant cures the violation by the
date designated by the landlord, no sooner than 14 days
after the notice. Thus, it would seem that not all violations
are subject to being cured or subject to notification of an
opportunity to cure and that there must be an initial deter-
mination whether “the tenant can cure the violation as pro-
vided in subsection (4).”
         In plaintiff’s view, the landlord makes the deter-
mination based on the particular tenant’s ability (financial
and practical) to make the necessary repairs. In defendant’s
view, the violation is one that can be cured if the violation
is one that is subject to cure by one of the means listed in
ORS 90.394(4)(a), without reference to whether the particu-
lar tenant has the ability to cure the violation.
         We think that the correct construction of the stat-
ute lies between those two views. Under both ORS 90.392(3)
and (4), notice must be given only if the violation is one that
can be cured by the tenant by one of the means listed in
ORS 90.392(4)(a). ORS 90.392(4)(a) continues by stating
that the rental agreement shall not terminate “if the tenant
cures the violation by the designated date.” The designated
date, in turn, must be “[a]t least 14 days after delivery of the
Cite as 326 Or App 1 (2023)                                         7

notice.” Here, as noted, the trial court found that, although
the damage to defendant’s apartment could be cured by one
of the means listed in ORS 90.392(4), it could not be cured
within the minimum 14-day period, thereby excusing the
requirement to give notice. Thus, as the trial court under-
stood the statute, if the notice is not given, and the landlord
establishes that the violation could not have been remedied
within the minimum 14-day period, the absence of a notice of
an opportunity to cure does not invalidate the termination.
         We conclude that the trial court’s construction of the
statute was largely correct. The requirement to give notice
of an opportunity to cure is dependent on the landlord’s
assessment whether the violation is one that reasonably can
be cured within the minimum time period required by ORS
90.392(4)(a)(A) (or the time period provided by the landlord).
Contrary to plaintiff’s contention, that does not include the
landlord’s assessment of the tenant’s particular financial
ability to cure the violation; rather, it only requires a deter-
mination by the landlord whether the violation is one that
is reasonably capable of being cured within the prescribed
time, i.e., within the minimum notice period that the land-
lord is required to give. That determination is also subject
to the statutory obligation of good faith that applies to all
duties under Oregon’s Residential Landlord and Tenant Act.
See ORS 90.130 (“Every duty under this chapter and every
act which must be performed as a condition precedent to the
exercise of a right or remedy under this chapter imposes an
obligation of good faith in its performance or enforcement.”);
ORS 90.100(19) (defining “good faith” to mean “honesty in
fact in the conduct of the transaction concerned”).
         In defendant’s view, the legislative history of ORS
90.392 requires the conclusion that if the violation is one
that can be cured through any means (a “change in conduct,
repairs, payment of money or otherwise”), ORS 90.392(4)(a),
the landlord must offer an opportunity to cure. Defendant
explains that former ORS 90.400(1)(a) (1993), repealed by Or
Laws 2005, ch 391, § 7, provided:
      “Except as provided in this chapter, if there is a material
   noncompliance by the tenant with the rental agreement,
   a noncompliance with ORS 90.325 materially affecting
8                                  KKMH Properties, LLC v. Shire

    health and safety, a material noncompliance with a rental
    agreement regarding a program of recovery in drug and
    alcohol free housing or a failure to pay a late charge pursu-
    ant to ORS 90.260 or a utility or service charge pursuant to
    ORS 90.315(4), the landlord may deliver a written notice to
    the tenant terminating the tenancy for cause as provided
    in this subsection. The notice shall specify the acts and
    omissions constituting the breach and shall state that the
    rental agreement will terminate upon a date not less than
    30 days after delivery of the notice. If the breach is remedia-
    ble by repairs, payment of damages, payment of a late charge
    or utility or service charge, change in conduct or otherwise,
    the notice shall also state that the tenant can avoid termina-
    tion by remedying the breach within 14 days.”

(Emphasis added.) Defendant asserts that the text of former
ORS 90.400 (1993) (“If the breach is remediable” by one of
the listed methods (emphasis added)) stated an “objective”
standard for determining whether a violation was of the
type that was subject to cure and did not depend on a deter-
mination by the landlord as to whether the violation could
be cured. ORS 90.400 (1993) was repealed in 2005, Or Laws
2005, ch 391, § 7, and replaced with ORS 90.392. Defendant
argues that the legislative history shows that the text of
ORS 90.392 was not intended to make substantive changes
to former ORS 90.400 (1993); therefore, he contends, the
current text should be viewed as maintaining the objective
standard that he asserts was applicable under former ORS
90.400 (1993).3
         Defendant correctly points out that under the text
of former ORS 90.400 (1993), a notice was required if the
violation was “remediable” by one of the means described in
   3
     In written testimony presented on June 1, 2005, to the Senate Rules
Committee on House Bill 2524A, a representative of the Lane County Law and
Advocacy Center testified:
    “Other parts of ORS 90.400(1) have not changed, such as the requirement
    that the 30 day notice specify—designate—the date when the tenancy
    ends, if the tenant fails to cure. Nor is there any change regarding the
    issue of whether a violation can be cured: tenant advocates think that all
    violations can be cured, while landlord advocates think not, and the new
    language doesn’t address that issue any more than the existing language
    does.”
Testimony, Senate Committee on Rules, HB 3524, June 1, 2005 (statement of
John Vanlandingham).
Cite as 326 Or App 1 (2023)                                  9

the statute, suggesting an objective standard rather than a
subjective evaluation whether the particular tenant is able
to cure the violation. Further, it appears from the legislative
history that the 2005 amendments that resulted in ORS
90.392 were not intended to effect a substantive change. But
neither the text of former ORS 90.400 (1993) nor the legisla-
tive history of ORS 90.392(4) addresses how the determina-
tion was to be made whether the violation was “remediable”
or “can” be cured. If, as defendant argues, the legislature
intended that an opportunity to cure was required for any
violation that could be cured by one of the means described
in ORS 90.392(4)(a), it could have so stated. Instead, with
the amendments made to the statute in 2005, the legisla-
ture stated that the notice must be given if the violation is
one that can be cured. A violation is one that can’ be cured
if the tenant is able to cure it. See Webster’s Third New Int’l
Dictionary 323 (unabridged ed 2002) (defining “can” as “to
be able to do, make, or accomplish”). That implies at least
an assessment as to whether the violation is one that can be
cured. In our view, that assessment includes consideration
whether the violation is one that can reasonably be cured
within the required notice period.
         The legislature knows how to mandate notice of
an opportunity to cure for certain violations. See, e.g., ORS
90.394(3) (requiring notice to provide statement of the
amount in default and the time to cure default in payment of
rent); ORS 90.396(2) (“If the cause for a termination notice
given pursuant to subsection (1) of this section is based
upon the acts of the tenant’s pet, the tenant may cure the
cause and avoid termination of the tenancy by removing the
pet from the premises prior to the end of the notice period.
The notice must describe the right of the tenant to cure the
cause.”). It has not done so in ORS 90.392, instead requiring
notice only if the violation is one that can be cured. Thus, we
conclude that it is the landlord’s responsibility to determine
in good faith whether the violation is one that reasonably
can be cured by one of the means described in ORS 90.392(4),
within the notice period required by ORS 90.392(4)(a)(A). If
so, the notice must be given.
         And if, as here, the landlord determines not to give
notice of an opportunity to cure, and the tenant challenges
10                         KKMH Properties, LLC v. Shire

the termination on that ground, it is the landlord’s obliga-
tion to establish that the violation could not reasonably have
been cured within the 14-day minimum notice period that
the landlord was required to provide. Here, the trial court
found that, although the violations were subject to “even-
tual restoration,” they could not have been cured within the
14-day period that plaintiff was required to provide. The
trial court’s finding is supported by evidence in the record.
We therefore affirm the trial court’s conclusion that the
notice of an opportunity to cure was excused, reject defen-
dant’s assignments of error, and affirm the trial court.
        Affirmed.