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Melnik v. Baldwin

Court of Appeals of Texas, Fourth District, San Antonio

June 5, 2019

Charles J. MELNIK, Appellant
v.
Dewayne BALDWIN, Tonia Baldwin, Appellees

          From the County Court at Law No. 1, Guadalupe County, Texas Trial Court No. 2018-CV-0012 Honorable Robin V. Dwyer, Judge.

          Sitting: Rebeca C. Martinez, Justice Patricia O. Alvarez, Justice Liza A. Rodriguez, Justice

          MEMORANDUM OPINION

          Rebeca C. Martinez, Justice.

         Charles Melnik appeals certain findings and conclusions in a bench trial adjudicating a landlord-tenant dispute. Melnik, the landlord, argues the trial court erred in: (1) holding the reletting fee could not be deducted from the security deposit; (2) failing to award Melnik attorney's fees and costs under a provision of the lease and section 38.001 of the Texas Civil Practice and Remedies Code; and (3) failing to award him attorney's fees because the lawsuit was based on frivolous claims.[1]

         Background

         On June 29, 2015, Melnik entered into a residential lease with Tonia and Dewayne Baldwin (the "Baldwins") requiring the Baldwins to pay Melnik $2, 500 a month to lease one of Melnik's rental homes. The lease term was for two years and required the Baldwins to pay a $2, 500 security deposit. The Baldwins leased the home without issue until late October 2016. At that time, the Baldwins notified Melnik they had purchased a new home and would vacate the rental home in late December 2016. The Baldwins told Melnik they would continue to pay rent until he was able to lease the property to new tenants. Melnik immediately listed the property for lease with his real estate agent who secured new tenants on April 17, 2017. The real estate agent charged a reletting fee of $1, 750.

         The Baldwins and Melnik disputed how much of the security deposit and pro-rated rent reimbursement for the month of April should be returned to the Baldwins. The Baldwins paid the full amount of $2, 500 for April's rent. Therefore, Melnik held a $2, 500 security deposit and $1, 166.67 in pro-rated rent reimbursement[2] that was due to the Baldwins after proper statutory and lease deductions. A summary of Melnik's accounting regarding the deductions from the security deposit and pro-rated rent reimbursement are as follows:

Security Deposit

$2, 500.00

Pro-rated Rent Reimbursement(April 17-30)

$1, 166.67

Reletting Fee

-$1, 750.00

Yard Work/Clean-up

-$850.00

Utilities

-$199.23

Utilities Transfer Fee

-$93.00

Misc. Home Repairs

-$258.14

House Cleaning

-$225.00

Carpet Cleaning

-$193.77

Total Reimbursement

$97.53

         On May 1, 2017, Melnik sent the Baldwins a letter containing this accounting with a check for $97.53. The Baldwins subsequently filed suit alleging the security deposit was wrongfully withheld.[3]

         The trial court found Melnik had wrongfully deducted the reletting fee, half of the yard work and cleanup, and the utilities transfer fee. The trial court reasoned the reletting fee was not a recoverable expense under the lease or the Texas Property Code, but was simply a "cost of doing business." The trial court reasoned that half of the yard work expenses were due to normal "wear and tear"-which was not recoverable under the lease. Finally, the trial court determined the lease did not allow Melnik to recover the cost of transferring the utilities into his name.[4] The trial court found the deductions for the other half of the yard work, miscellaneous repairs, house cleaning, and carpet cleaning were all proper deductions, and the trial court ordered the Baldwins recover $1, 399.44 of their security deposit from Melnik.[5]

         With regard to attorney's fees and costs, Melnik argues on appeal that he is entitled to recover his attorney's fees and costs under the following provision of the lease.

         18. Attorney's Fees

Should it become necessary for Landlord to employ an attorney to enforce any of the conditions or covenants hereof, including the collection of monthly rents or gaining possession of the premises, Tenant agrees to pay all expenses so incurred, including all attorney's fees and Landlord travel costs.

         The trial court held "the cost and expense provisions of the lease to be not in compliance with statute . . . and therefore award neither party any attorneys fees and order the costs of ...


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