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Mar 2, 2011

Law Court Rules on When a Property Is a Rental Property or Lodging House

Category: Firm News

Guests in a “lodging house” are not considered tenants of rental property and can be evicted without following the court procedures for forcible entry and detainer.  The owner of an inn, hotel, restaurant, or lodging house, or and innkeeper or campground owner can summarily eject guests deemed to be causing “unnecessary disturbance.”  Id. § 3837, 3838 (5) (A).  Such guests are deemed licensees rather than tenants.  Therefore, it can be critical whether a property is a lodging or boarding house for short term guests or a rental property for longer term occupancy.  One property owner in Bangor has just learned that its property is not a “lodging house” as it thought. 

At the end of February, the Maine Law Court decided Degenhardt v. EWE Limited Partnership,  2011 ME 23 (February 24, 2011).  The Court affirmed a decision of the District Court that Degenhardt was a tenant who could only be evicted through the FED process and not a “guest” in a “lodging house,” as the property owner contended, who could be ejected by the owner without following the FED requirements.  The court reduced his wrongful eviction damages from $590 to $473.33, however, because he had not proved that he had been damaged by $240 when excluded from his unit for “four days and nights.”  Degenhardt was represented by Pine Tree Legal Assistance. 

EWE Limited Partnership operated a 15 unit building on Union Street in Bangor it called “Union Street Inn,” and which it tried to operate as a lodging house rather than a rental property.  It was licensed by the City of Bangor as a “lodging house” and offered rooms on a daily basis.  However, on the facts of the case, the court sustained findings that the property was not lodging house under the law.  Degenhardt lived in the building for 8 months and paid a monthly rent rather than the daily fee.  He was arrested for disorderly conduct and spent a night in jail.  When he got back the next morning the owner ejected him, resulting in the suit.  The court explained its reasoning on the “lodging house” issue as follows: 

Although the property here retains qualities of both a lodging house and regular rental property, we agree with the District Court that the arrangement between the parties more closely resembles the latter. According to the undisputed testimony, the building has no doorman or desk clerk, and management did not retain keys to the individual units. The rooms themselves were minimally furnished, and only certain units contained kitchen or bathroom facilities.  Although EWE was granted a municipal license to operate the property as a “lodging house,” it achieved only partial compliance with the other statutory requirements: room rates were posted, but not in the units themselves; a guest register was maintained, but it contained no record of Degenhardt’s move to unit 9.  We also note the apparent discrepancy between the Union Street property’s Rules and EWE’s actual operating procedure: cleaning and linen services were offered, but no resident ever utilized them; the posted room rates indicated a daily fee, but the vast majority of residents were charged on a monthly basis. Indeed, although the Rules emphasized that occupants were “short term guest[s],” Degenhardt lived at the Union Street building continually (sic) for eight months prior to his eviction.  Other guests had been living at the property for years, including one guest for over twenty-five years. Based on these facts, we cannot say that the court erred in concluding that the Union Street property was not a lodging house within the meaning of 30-A M.R.S. §§ 3837 and 3838.

 By Bryan M. Dench 

For more information or if you have questions or concerns, contact us and speak with James E. Belleau, Norman J. Rattey, Bryan Dench, or another Skelton, Taintor & Abbott attorney.