E-Alert Case Updates

Court of Appeals Strikes Down Landlord Immunities and $17,000 Damages Cap in Maryland Lead Paint Act

Jackson v. Dackman Company
No. 131 (Maryland Court of Special Appeals, October 24, 2011)
by Colleen K. O’Brien, Associate
Semmes, Bowen & Semmes (www.semmes.com)

In this case, Maryland’s high court considered the constitutionality of the immunity provisions and the $17,000 cap on remedies contained in Maryland’s 1994 Reduction of Lead Risk in Housing Act (“Maryland Lead Paint Act” or “Act”), as codified in MD. CODE ANN., ENVIR. §§ 6-801, et seq.

The stated purpose of the Act was to “reduce the incidence of childhood lead poisoning, while maintaining the stock of available affordable rental housing.” The Act contained broad immunities for landlords who complied with it and limited the damages available to tenants poisoned by lead.

For instance, if a “person at risk,” such as a pregnant woman or child, were poisoned by lead while residing in a rental property, and the property owner complied with certain requirements under the Lead Paint Act, then the property owner or its insurer could make an offer of $17,000 to the injured individual, and then be completely immune from further tort liability. Moreover, the $17,000 offer was intended to go toward medical expenses and relocation services, and was paid directly to the medical or service provider rather than to the injured person. If the “person at risk” accepted the $17,000 offer (or in the case of a child, if their parent accepted the offer on their behalf), then the property owner was released from all liability, including a later suit for personal injuries by the injured person. If the offer was made, and rejected, then the owner was still immune from liability. Finally, in certain circumstances, even if an offer were never made, due to a failure by the injured person to comply with certain notice provisions or to be eligible for the offer under the Act, then the owner was still immune.

Here, the underlying suit involved an action by a child and her mother. They sued property owners for damages related to the child’s severe and permanent brain injuries allegedly arising from her ingestion of lead-based paint at two properties. The Defendant argued that it complied with the Lead Paint Act, and was immune from suit. The Plaintiffs argued that the Act’s grant of immunity was unconstitutional and also that the Defendant failed to comply with the Act because it failed to file the required certifications in a timely manner. The Circuit Court granted the Defendant’s Motion for Summary Judgment, finding that the immunity provisions of the Act were constitutional and that the Defendant complied with the Act. The intermediate appellate court held that the Act was constitutional, but held that the Defendant failed to comply with it. The Plaintiffs appealed the constitutionality of the statute under Article 19 of the Maryland Declaration of Rights to the Court of Appeals.

The sole issue considered by the Court of Appeals was the constitutionality of the Act under Article 19 of the Maryland Declaration of Rights. Article 19 generally protects two interrelated rights: (1) a right to a remedy for an injury to one’s person or property; (2) a right of access to the courts. The Court noted that any restrictions on Article 19 rights were required to be reasonable.

The Court held that the immunity provisions of the Act violated Article 19 of the Maryland Declaration of Rights: “For a child who is found to be permanently brain damaged from ingesting lead paint, proximately caused by the landlord’s negligence, the maximum amount of compensation under a qualified offer is minuscule. It is almost no compensation.” Therefore, the remedy which the Act substituted for a traditional personal injury action results in either no compensation (where no qualified offer is made or where a qualified offer is rejected) or drastically inadequate compensation (where such qualified offer is made and accepted).

Although the Court held that the immunity provisions of the Act were unconstitutional, it held that they were severable from the remainder of the Act. Therefore, the remaining provisions of the Act are still in effect, such as the registration, inspection, and risk reduction standards set forth in the statute.