Jose Calderon and Veronica Gonzales, representing their children E.G. and A.G., appealed a district court decision regarding their civil petition against Saber Khan. The appeal addressed four main claims: unfair and deceptive acts, breach of express warranty of habitability, breach of implied and statutory warranty of habitability, and requests for declaratory and injunctive relief. The appellants contended that the court incorrectly dismissed counts one and two, along with part of count four related to these counts. They also argued that the damages awarded for emotional distress under count three lacked substantial evidence, punitive damages were unjustly denied, and only half of their requested attorney fees were granted.
The background indicates that the appellants signed a one-year lease nearly twenty years prior and continued living in the apartment on a month-to-month basis after the lease expired. They reported infestations of bed bugs, mice, and cockroaches starting around 2010, which Khan failed to adequately address despite being notified. This negligence led to various hardships for the appellants, including health issues and emotional distress, rendering the apartment uninhabitable and in violation of health codes. The appellants asserted that Khan's actions constituted unfair practices and a breach of the lease's warranty of habitability, obligating him to maintain safe living conditions. They sought statutory damages and attorney fees based on Iowa law.
In count four, the appellants sought declaratory and injunctive relief to compel Khan to address an infestation issue. After multiple unsuccessful attempts to serve Khan, the appellants were granted additional time for service but denied alternative service methods. Later, the court authorized service by alternative means, and in February 2019, confirmed the appellants' compliance. Following the court's order for service by publication and Khan's failure to respond, the appellants applied for a default judgment. After a hearing in February 2020, where Khan did not appear, evidence was presented regarding the infestation, including testimony from Calderon about the family's financial losses and health issues stemming from their living conditions. The court found Khan in default but deemed the evidence insufficient to support claims for emotional distress or the terms of the lease. Although the appellants sought nearly $1,000,000 in damages and attorney fees, the court awarded $38,250 for count three, which included specific reimbursements for carpet replacement, clothing, furniture, and a portion of past rent payments. The court also awarded $3,506.25 in attorney fees, half of the requested amount. The appellants subsequently appealed the decision, with the document noting that personal judgments against a defendant served only by publication require that the defendant has appeared, as established by Iowa case law. The standard of review for default judgments is for legal error, while punitive damages and attorney fees are reviewed for abuse of discretion.
The appellants contend that the court erred in dismissing claims related to consumer fraud, breach of express warranty of habitability, and declaratory and injunctive relief. The court was permitted to enter judgment and subsequently assess evidence for damages, as counts one and two did not specify a sum certain. Following Khan's default, the court deemed the facts in the petition admitted, except for value or damage claims. The court's dismissal of the claims was interpreted as a finding that the appellants did not prove any non-duplicative damages, as all theories of relief stemmed from the same circumstances. The appellants did not contest the monetary damages awarded under count three. The court's dismissal language was vacated, clarifying that the appellants failed to demonstrate non-duplicative damages for counts one and two. Additionally, the request for declaratory and injunctive relief was deemed moot since the appellants had vacated the apartment by trial.
Regarding past pain and suffering and emotional distress, the appellants argued for damages but failed to provide monetary evidence to substantiate their claims. The district court found no credible documentation to support their testimony, and both the court and the appellate body declined to arbitrarily assign a damage amount, affirming the decision not to award damages in this category.
Appellants argued that the court erred in denying their request for punitive damages, specifically seeking treble damages under Iowa Code section 714H.5(4) due to alleged willful and wanton disregard by Khan for their rights. The district court determined that the appellants did not sufficiently prove entitlement to punitive damages, as defined by requiring evidence of legal malice, which involves wrongful actions taken with reckless disregard for others' rights. The appellants only pursued treble damages and did not make a separate request for punitive damages. Additionally, they pointed to violations under chapter 562A rather than chapter 714H, leading to a waiver of their treble damages argument due to lack of proper legal reasoning and citation, as required by Iowa rules.
Regarding attorney fees, the district court ruled in favor of the appellants under chapter 562A but awarded only half of the requested fees without providing an explanation. The absence of a clear rationale made it impossible to assess whether the court abused its discretion. As a result, the attorney fee award was vacated, and the matter was remanded for reconsideration with a required explanation. The court affirmed the district court’s ruling overall, except for the noted modifications, specifically vacating and remanding the attorney fee award.
