On February 27, the Maryland Court of Appeals released their written opinion in Gregory Smith v Wakefield LP.
At some point in the last few decades, landlords began converting residential leases, which have three-year statute of limitations, to “contracts under seal” which have a 12-year statute of limitations, simply by the word “seal” next to the signature line in the lease, allowing landlords to bring suits for alleged damages several years after tenant has left the property (and no longer has photos and documentation to defend the suit). PBRC’s Consumer Protection Project (CPP) sees the results of this practice on the affidavit judgment docket almost every week. The morning the decision was released, we had a client being sued for alleged damages from an apartment she moved out of ten years ago!
In this case, Wakefield brought suit against Smith in 2015 for alleged unpaid rent and damages from 2008. Smith, represented by a CPP volunteer attorney, argued the case was outside the three-year statute of limitations for residential leases (in addition to arguing he didn’t owe anything because he gave proper notice); Wakefield argued that the lease is a “contract under seal” with a 12-year statue of limitations. The Baltimore City District and Circuit Court agreed with Wakefield that the suit was filed timely because the lease was a “contract under seal” with a 12-year statute of limitations. Smith’s attorneys appealed the decision to the Court of Appeals.
The Court of Appeals’ decision?
“We reverse. We hold that actions for back rent under residential leases are subject to a three-year period of limitations—as they have been for the last three centuries in Maryland—regardless of whether the lease includes provisions that purport to convert into a contract under seal.” The court went on to say that an agreement between a landlord and a tenant to the statue of limitations to 12 years is contrary to this State’s landlord/tenant law.
-Sydney Dunning, Esq.