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01/24/92 TENANTS 500 23RD STREET v. DISTRICT

January 24, 1992

TENANTS OF 500 23RD STREET, N.W., ET AL., PETITIONERS
v.
DISTRICT OF COLUMBIA RENTAL HOUSING COMMISSION, RESPONDENT; COLUMBIA PLAZA LIMITED PARTNERSHIP, INTERVENOR



Before Terry and Farrell, Associate Judges, and Belson, Senior Judge.

The opinion of the court was delivered by: Farrell

On Intervenor's Motion For An Award of Attorney's Fees

FARRELL, Associate Judge: Section 902 of the Rental Housing Act of 1985 (the Act) provides that, except in eviction cases, courts may "award reasonable attorney's fees to the prevailing party in any action under [the Act]." *fn1 D.C. Code § 45-2592 (1990). This motion requires us to determine the proper standard under the Act for awarding attorney's fees to a prevailing housing provider. *fn2

I.

In September 1987, intervenor Columbia Plaza Limited J Partnership, a "housing provider" under the Act, *fn3 filed several capital improvement petitions before the Rent Administrator pursuant to § 210 (i), D.C. Code § 45-2520 (i). *fn4 A small group of tenants of the property contested these petitions. Initially, the Rent Administrator dismissed the petitions on procedural grounds. On appeal to the Commission, that decision was reversed and the petitions were remanded for consideration on the merits. After a full hearing, the Rent Administrator again dismissed the petitions. The housing provider appealed and the Commission reversed the dismissal, ordering rent ceiling adjustments. The tenants sought judicial review by this court of the Commission's decision. See § 219, D.C. Code § 45-2529. Although the tenants raised eight claims of error before this court, we "affirm the Commission's order in all respects" and addressed only a few points raised by the tenants that "merit Discussion." Tenants of 500 23rd St., N.W. v. District of Columbia Rental Hous. Comm'n, 585 A.2d 1330, 1331 (D.C. 1991). The housing provider, the "prevailing party" in this action, *fn5 now moves under § 902, D.C. Code § 45-2592, for an award of attorney's fees for services rendered by counsel during the course of judicial review. *fn6

II.

On its face § 902, D.C. Code § 45-2592, is silent about the standards that should serve to guide the award of attorney's fees to prevailing parties in cases brought under the Act. To assist in interpreting this provision, we have turned to the underlying legislative purpose of the section. See Ungar v. District of Columbia Rental Hous. Comm'n, 535 A.2d 887, 892 (D.C. 1987). On the one hand, § 902 was designed to deter "frivolous cases" litigated under the Act. The author of the provision, Councilmember Clarke, "put [the counsel fee provision] in because . . . sometimes frivolous cases are brought and sometimes attorneys' fees are justified on both sides of the issue." *fn7 Remarks of Councilmember Clarke, Transcript of District of Columbia Council Proceedings at 104 (Nov. 14, 1980). On the other hand, we have recognized that § 902 was intended to encourage compliance with the Act by facilitating remedial litigation by tenants. In Ungar, supra, "we infer from the statutory scheme that . . . the purposes of the attorney's fee provision are to encourage tenants to enforce their own rights, in effect acting as private attorneys general, and to encourage attorneys to accept cases brought under the ." 535 A.2d at 892. See also Hampton Courts Tenants' Ass'n, 573 A.2d at 12, 13 (noting Ungar's "adopt[ion of] the 'private attorney general' analysis stated by the Supreme Court in explication of the [Civil Rights Act of 1964]").

Consistent with the goal of encouraging litigation by tenants acting as "private attorneys general," we interpret § 902 as entitling prevailing tenants to a presumptive award of attorney's fees. See Newman v. Piggie Park Enterprises, Inc., 390 U.S. 400, 402 (1968) (construing 1964 Civil Rights Act). Indeed, we have already held that under § 902 prevailing tenants, regardless of their position in the litigation, should generally be awarded attorney's fees though these "may be withheld, in the court's discretion, if the equities indicate otherwise." Ungar, 535 A.2d at 892; see also Tenants of 2301 E St., N.W. v. District of Columbia Rental Hous. Comm'n, 580 A.2d 622, 626 (D.C. 1990); Hampton Courts Tenants' Ass'n, supra; Alexander, 542 A.2d at 360-61. *fn8

Intervenor argues that a housing provider is entitled to the same presumptive award of attorney's fees as are prevailing tenants. It reasons that when a housing provider files a meritorious capital improvements petition seeking a rent adjustment under § 210 (i), D.C. Code § 45-2520 (i), it furthers the purposes of the Act in general and specifically of § 210, and so is properly cast in the role of "private attorney general." This argument, however, while emphasizing the goals of other sections of the Act, does not focus adequately on the specific goals of the attorney's fee provision, which we conclude must be our guide. See, e.g., Newman v. Piggie Park Enterprises, Inc., 390 U.S. at 402 (analyzing Congress' purpose in enacting counsel fee provision of Title II of Civil Rights Act of 1964 to determine criteria for awards to prevailing plaintiffs); Christiansburg Garment Co. v. EEOC, 434 U.S. 412, 417-22 (1978) (analyzing legislative history of counsel fee provision of Title VII of Civil Rights Act of 1964 to determine criteria for awards to prevailing defendants). while the Act does grant rights for housing providers and authorizes capital improvement petitions, nothing in the text of § 902 or its legislative history indicates that the legislature sought to encourage or facilitate housing provider enforcement actions by attorney's fee awards in favor of housing providers, or to create an incentive for attorneys to accept housing provider cases by means of fee awards against unsuccessful tenants. See Ungar, 535 A.2d at 892; Hampton Courts Tenants' Ass'n, 573 A.2d at 12. Since housing provider litigation fails to serve these goals of the attorney's fee provision of the Act, we hold that prevailing housing providers do not enjoy a presumptive entitlement to attorney's fee awards.

That, however, does not end the analysis. Presumptions aside, our reading of § 902 makes clear to us, as it was to the Supreme Court in interpreting identical statutory language enacted under similar circumstances, that the legislature intended something else besides facilitating remedial litigation by tenants under the Act. As the remarks of Councilmember Clarke, (supra) , indicate, the legislature also wanted to protect housing providers "from burdensome litigation having no legal or factual basis." Christiansburg Garment Co., 434 U.S. at 420. To accommodate these sometimes competing goals, we conclude that attorney's fees may be assessed in favor of a prevailing housing provider when the litigation of tenants is "frivolous, unreasonable, or without foundation, even though not brought in subjective bad faith." Christiansburg, 434 U.S. at 421; see Hamer v. County of Lake, 819 F.2d 1362, 1366-67 (7th Cir. 1987), cert. denied, 110 S. Ct. 146 (1989). This interpretation of the statute has been adopted by the Rental Housing Commission for attorney's fee awards to prevailing housing providers in several categories of litigation at the administrative level. See Hagner Management Corp. v. Rutherford, TP 12,117 (RHC Sept. 8, 1986) (prevailing housing provider in tenant petition case); Columbia Plaza Ltd. Partnership v. Tenants of 500 23rd St., N.W., CI 20,266 - 20,268 (RHC May 30, 1991) (prevailing housing provider in capital improvement case); Tenants of 1255 New Hampshire Ave., N.W. v. Hamilton House Ltd. Partnership, HP 20,388 (RHC May 30, 1991) (prevailing housing provider in hardship petition case). That reading of the statute by the agency charged with its enforcement confirms our judgment of the appropriateness of this standard.

The housing provider argues for a looser reading of § 902 which would allow an award of fees to a prevailing housing provider in the "sound discretion" of the court, "taking into account the relevant facts of the particular case." A purely discretionary standard, it urges, would better permit a prevailing housing provider to recover attorney's fees expended in resisting irrelevant and erroneous arguments pressed by tenants over years of litigation. *fn9 Though this proposed standard appears on the surface to be a "straightforward" and "even-handed" interpretation of § 902, we do not think it is consistent with the statutory purpose of facilitating tenant litigation under the Act but at the same time deterring "frivolous cases" on "both sides of the issue." Remarks of Councilmember Clarke, (supra) ; see Christiansburg Garment Co., 434 U.S. at 418-19. As did the Supreme Court, we think the Christiansburg standard best accommodates the "inherent tension" between these goals. Hamer, 819 F.2d at 1366.

The housing provider further argues that the Christiansburg standard, developed under the federal civil rights laws, is inapposite to the fee award provision of the Rental Housing Act because the underlying policies of the former -- combatting discrimination -- are not those of the Rental Housing Act, which carefully balances the rights of landlords and tenants. See Tenants of 2301 E St., N.W., 580 A.2d at 628 n.11. To accept this argument, however, would be to ignore the remarkable similarities of language and intent between the attorney's fee provisions of the two laws, and the fact that this court has heretofore looked to the former in interpreting our fee award provision. Hampton Courts Tenants' Ass'n, 573 A.2d at 12. Furthermore, many courts have applied the Christiansburg standard to other federal and state fee-shifting statutes. *fn10

We emphasize that this standard is not a reformulation of the traditional "bad faith" exception to the American Rule. See, e.g., Dalo v. Kivitz, 596 A.2d 35, 39-40 (D.C. 1991); Goffe v. Pickard, 588 A.2d 265, 271 (D.C. 1991) (defendant liable for attorney's fees under "bad faith" exception to American Rule when "conduct 'was vexatious and designed to avoid responsibility to the plaintiffs in bad faith'"). Under ยง 902, a finding of "subjective bad faith" is unnecessary to an award of attorney's fees in favor of a housing provider, provided the tenants' litigation was "frivolous, unreasonable, or without ...


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