Chapter § 31.5 TENANT REMEDIES

• Jurisdiction: Oregon

§ 31.5 TENANT REMEDIES

§ 31.5-1 Rent Withholding; Rent Redemption

ORS 90.370 is commonly referred to as rent redemption. This statute specifies that in an eviction for nonpayment of rent, or in an action for rent when the tenant is in possession,

the tenant may counterclaim for any amount, not in excess of the jurisdictional limits of the court in which the action is brought, that the tenant may recover under the rental agreement or this chapter, provided that the tenant must prove that prior to the filing of the landlord's action the landlord reasonably had or should have had knowledge or had received actual notice of the facts that constitute the tenant's counterclaim.

ORS 90.370(1)(a).

The purpose of rent redemption "is to allow the tenant to get needed repairs without having to move." Amatisto v. Paz, 82 Or App 341, 347, 728 P2d 42 (1986). However, the tenant is limited to bringing only counterclaims asserted in good faith. See Commonwealth Property Management, Inc. v. Hanson, 94 Or App 136, 764 P2d 950 (1988) (affirmed trial court's finding that tenant's counterclaim for habitability defect was filed in bad faith and was pretextual). Counterclaims that are "[s]purious, frivolous, or improperly motivated . . . may not be used to justify a tenant's rent withholding." Napolski v. Champney, 295 Or 408, 419, 667 P2d 1013 (1983). Otherwise, the tenant's withholding of rent "effectively shifts to the landlord the burden to commence any litigation necessary to determine the parties' rights in the dispute and, further, confronts the landlord with the risk of becoming liable for costs and attorney fees if the tenant 'prevails.'" Napolski, 295 Or at 418.

The court may order that the tenant pay into court all or part of the rent that has accrued and is thereafter accruing. At the conclusion of trial, the court will determine the amount due to each party. After disbursing rent appropriately, if no rent remains due to the landlord after application of the statute, judgment "shall be entered for the tenant in the action for possession." ORS 90.370(1)(b). Stated differently, if the court finds that even one dollar is owed to the tenant for diminished habitability, as long as all rent owed to the landlord was tendered into court before commencement of trial; and after disbursing the rent owed to the landlord and the one dollar owed to the tenant, because no rent then remains due to the landlord, judgment will be entered for the tenant. See Eddy v. Parazoo, 77 Or App 120, 124, 711 P2d 205 (1985) (tenant may prevail by tendering, after verdict but before entry of judgment, the difference between rent adjudged due to the landlord and amount awarded on counterclaims).

Rent redemption does have limitations. For example, if the tenant does not comply with an order to pay rent into court the tenant will not be permitted to assert a counterclaim in the action for possession. ORS 90.370(3). Also, if the total amount found due to the tenant on any counterclaim is less than the rent found to be due to the landlord and the tenant then retains possession solely because the tenant paid rent into court, "no attorney fees shall be awarded to the tenant unless the tenant paid at least the balance found due to the landlord into court no later than the commencement of the trial." ORS 90.370(4).

§ 31.5-2 Action for Damages

§ 31.5-2(a) Diminished Habitability

ORS 90.360 allows a tenant to recover damages for any non-compliance by the landlord with (1) the rental agreement; (2) ORS 90.320, which specifies habitability obligations of...