If alandlord fails to obtain an occupancy certificate, does that breachthe tenant’simplied warranty of habitability?

Town ordinances clearly require a landlord to obtain a C/O from the town. For 10 months a tenant leased a small house from landlord, for $1,000 per month, and paid several thousand dollars for utilities. Does tenant have a cause of action based on breach of the landlord’s implied warranty of habitability, since no certificate was ever issued? Can tenant recover the approximately $25,000 he paid landlord pursuant to an unlawful lease? This all occurred over 2 years ago.

Asked on August 23, 2011 Connecticut

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

1) A failure to obtain a certificate of occupancy does not breach the implied warranty of habitabiliy, since it does not impact the fitness of the premises for its purpose--i.e., it does not literally affect "habitability," since a premises can be habitable even if its violates the law to in fact inhabit it. The implied warranty of habitability protects tenants from having space that is not useful due to leaks, heating/cooling problems, mold, large holes in walls or ceilings, inoperative utilities, etc.

2) If there was no C/O, the lease was illegal--it violated that law. That would have let you out of the lease, without penalty, if you had moved to void or rescind the lease while there. It will not let you recover money after the fact because a) you were not damaged by the illegal occupancy--you apparently rented the place and got what you paid for; and similarly b) to give you the money back would unjustly enrich you, since it would mean that you were able to lease  the premises for "free." Illegal leases are voidable, but they do not automatically give rise to a claim for compensatory damages if you were not injued in some way.


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