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Not so long ago, the appearance of a black smudge on a bathroom ceiling triggered a search for a sponge and a bottle of Tilex. These days, it is more likely to trigger calls to a lawyer and an industrial hygienist, extensive testing for “toxic mold” and a law suit. In fact, in the landlord-tenant arena, mold has replaced lead paint as the de facto defense of tenants fighting eviction actions. Fortunately for landlords (and community associations), the mold defense – “I’m withholding my rent (or suing my condominium association) because of the toxic mold growing in my bathroom” – is not a slam dunk. Tenants or condominium owners pursuing those claims must clear four legal hurdles in order to prevail.

	They have to establish that mold is present in their residence. This isn’t difficult, as mold is virtually omnipresent. I used to tell judges that mold exists every place except in a vacuum, until scientists found mold in outer space, too. But not every black, icky substance on a wall is necessarily mold. Rather, it requires a scientific test to confirm that it is in fact mold. One judge went so far as to require a tenant, who lacked a scientific analysis of the substance about which she was complaining, to refer to it as “black, icky stuff” rather than mold throughout the trial.
	It isn’t enough to document the presence of mold; tenants/owners also have to demonstrate that the mold actually caused them harm. This isn’t so easy. There are thousands of different types of mold, most of which have existed for eons without attracting much attention or causing any problems. Toxic mold – the mold made famous by Melinda Ballard, the Texas homeowner, whose mold-infested house had to be demolished, and the type of mold everyone claims to have — is actually quite rare. That said, some people are highly sensitive to some types of mold, and this is the third legal hurdle for anyone pursuing a mold claim.
	Tenants or owners claiming to be harmed by mold must demonstrate that they are affected by the specific type of mold found in their residence; and
	They must demonstrate to a reasonable degree of scientific certainty that the mold detected caused the medical problems from which they claim to be suffering. This last hurdle in particular is one that few mold litigants have been able to clear.

Finding the Link

A recent case in which I was involved illustrates the challenge for tenants and owners that often gives landlords and community associations an advantage in court. The landlord in Avalon v. King sought to evict the tenant for non-payment of rent. The tenant argued that she had legitimately withheld her rent because the landlord failed to eliminate mold in her unit, which had cause her to suffer severe respiratory ailments. Extensive testing by the landlord and the tenant found several types of mold in the unit, some in large quantities. What the tenant couldn’t find, however, was evidence linking the mold directly with her medical problems.

The lower court ruled that the tenant had failed to demonstrate “a causal nexus between the conditions of the premises and [her] physical condition.” In other words, while mold was clearly present in the apartment, and while the tenant was clearly having breathing issues, there was no evidence that the two — the mold and the breathing problems — were connected.

The court also rejected the concept that the presence of mold, in itself, constituted a breach of the warranty of habitability. Rather, the court found that there had to be evidence that the mold was a defective condition that materially interfered with the tenant’s use and enjoyment of the apartment.

The appeals court agreed with both conclusions, finding that a causal “nexus” between the mold and the tenant’s breathing problems was an essential element of her claim, and that she had failed to demonstrate that the conditions in the apartment constituted a “material breach” of the warranty of habitability sufficient to justify the withholding of rent — a base line legal hurdle in the tenant’s eviction counter-claim.

While the testing had found mold in the apartment, the appeals court said, there was no evidence that its occurrence was “regular or periodic,” or that it exceeded the level “commonly found” in residential units. “It is clear,” the court said, “that the condition of which the tenant complained…did not make the apartment uninhabitable….To hold that the type of evidence advanced in this case is sufficient to establish an actionable condition would expose every landowner to liability for failing to undertake impossible remedial efforts,” the court concluded.

The problem this tenant and most plaintiffs have in pursuing mold claims is that mold exists, in some amounts, in every dwelling and federal and state health agencies have not established “acceptable” exposures for mold, as they have for radon and lead paint. So there is no benchmark for asserting that any mold concentrations are harmful per se.

No Medical Consensus

Mold creates an additional problem for plaintiffs, in that there is no scientific consensus that mold – even toxic mold — causes serious medical problems. In a discussion of the issue on its Website, the Centers for Disease Control asserts: “There are very few case reports that toxic molds…inside homes can cause unique or rare health conditions….These case reports are rare, and a causal link between the presence of the toxic mold and these conditions has not been proven.”

Consistent with that view, most courts to date have been skeptical of the medical evidence that mold plaintiffs have offered. In Davis v. Henry Phipps Plaza South, a New York trial court ruled against several tenants who claimed that mold in their units had caused serious neurological problems. According to the court, mold “has not gained general acceptance in the scientific community as a cause of brain injury, including cognitive impairment.”

Another New York trial court concluded similarly that the plaintiffs in a 2006 case had “failed to demonstrate that the community of allergists, immunologists, occupational and environmental health physicians and scientists accept their theory that mold and/or damp indoor environments cause illness.”

Even Melinda Ballard, the Texas homeowner who became something of a poster child for mold claims after winning a multi-million-dollar judgment, stumbled over the medical threshold. Her $32 million award (later reduced to $ 4 million) was for punitive damages assessed against Ballard’s insurance company, which the court found to be negligent in failing to correct the mold damage in her home before it got out of hand. But Ballard did not win anything for her personal injury claim, because the judge ruled that medical testimony linking mold to her family’s medical problems was not “scientifically valid” and so could not be introduced as evidence to support her claim.

Liability Concerns

Although the legal landscape has not been particularly friendly for some plaintiffs in mold litigation, landlords and community associations should not conclude that mold claims pose no potential liability risks for them. On the contrary, some court decisions have gone the other way. This list includes a 2004 Massachusetts case – Stevens v. Pirates Lane Condominium Trust — in which a condominium owner won a $285,000 judgment against her condominium association (estimated to total closer to $500,000 now, with the interest accumulated during an eight-year court battle). The court found the association liable for damages because of its failure to correct water seepage in a common area that produced mold and health problems that the owner argued successfully were related to it. (A few courts, like this one, have accepted the testimony of experts who attribute medical problems to mold after eliminating other possible causes.)

A similarly-minded Delaware Supreme Court upheld a $1 million award to a tenant for mold-related medical problems resulting, again, from water seepage the landlord failed to address. And earlier this year, another Massachusetts jury awarded several million dollars in damages to a tenant for mold-related ailments linked to moisture in her unit. Significantly, all of these cases turned in large part on the failure of landlords or association boards to take reasonable steps to prevent the growth of mold and to deal effectively with mold outbreaks when they occurred.

In Avalon (the Massachusetts eviction case mentioned earlier, in which the landlord prevailed), the landlord’s position was strengthened considerably by evidence that it had gone to great lengths to address the tenant’s concerns. Among other measures, this landlord hired an engineer to conduct an environmental assessment of the unit, replaced the tile calking around the tub and installed an air filter. Remember that in Ballard (the archetypal mold case), it was the insurance company’s negligence, not the medical problems allegedly caused by mold, that produced the outsized jury award.

Reducing the Risks

And that is the essential message for landlords and community associations. Your greatest liability risk isn’t the potential for mold litigation, but your failure to respond appropriately and effectively to the complaints about mold and/or moisture that precede those claims. Our advice:

	Take complaints about mold and moisture seriously. Establish procedures for managing them, follow those procedures scrupulously and document your response. If you receive a complaint about mold (black icky stuff, or mildew), respond immediately, follow your remediation protocol, and confirm your work, in writing, with the resident. Also, remind complaining resident, in writing, that they should report any further concerns immediately.
	Be proactive. There is no mystery about what causes mold – it’s moisture. Prevent moisture and you’ll prevent mold. If there’s a leak, fix it first; you can always fight later about who should pay for the repair. Had the board at Pirate’s Lane followed that advice and fixed the water problem instead of fighting for eight years about whether they were obliged to do so, they probably wouldn’t be trying to figure out how to pay a $500,000 liability judgment today. Also, consider other measures you can take if mold recurs, such as installing a stronger fan, putting vents in doors, etc. Also, since the most common cause of bathroom mold is the failure to use the fan (a very common problem when the occupants include teenaged children) consider re-wiring the bathroom fan so it is connected to the bathroom lights.\
	Follow up. If you replace calk, paint, plug holes or install fans, don’t assume those measures have worked; check back after a few weeks to make sure the problem has been resolved. One landlord we represented advised a tenant that using the bathroom fan would resolve the moisture problem about which the tenant was complaining. But when a subsequent check indicated that the tenant wasn’t following that advice, the landlord installed louvers in the door to provide the necessary ventilation. While he wasn’t required to take that extra step, it will probably solve the moisture problem. And it will strengthen the landlord’s legal position should the tenant’s complaints morph into a mold damage claim in the future.
	Make tenants and condominium owners share the responsibility for reducing mold risks. We advise landlords to include language in their leases specifying that tenants are required to properly maintain their units so mold doesn’t grow in them and are required to report any leaks immediately to the building owner or manager. We advise community association boards similarly to adopt resolutions or amendments imposing similar requirements on unit owners. The wording we suggest specifies the reasonable measures owners must take to reduce the risk of mold and water damage in their units, requires them to notify the board of any water or mold-related problems within their units that they can’t control, and makes it clear that owners will be liable if their actions, or failure to act, damages other units or common areas.

Detailing the obligations of tenants and owners in leases and condominium documents won’t prevent leaks or mold and it certainly won’t eliminate law suits related to them. But these defensive measures, combined with proactive management of water and mold complaints, will avoid some law suits and will short-circuit others by increasing the likelihood that courts will dismiss actions outright or issue summary judgment decisions much earlier in the process, before substantial legal costs have been incurred.

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