A Short History of Rent Escrow and MMLA's Settlement for a South Minneapolis Tenants' Group

In an unusual and complicated set of rent escrow cases that stretched from August 2022 to July 2023, Mid-Minnesota Legal Aid (MMLA), led by housing attorney Julia Zwak, represented a total of 12 primarily Spanish-speaking clients in seven separate rent escrow lawsuits that were combined for settlement and trial. A housing court referee agreed to combine the cases because of common building-wide issues in addition to individual repair issues in each client’s unit. The tenants and landlord agreed to formal mediation and the appointment of a third-party administrator to collect rent payments and inspect repairs, a notable departure from most rent escrow cases. The parties reached an agreement in November 2022 and by mid-April 2023, the administrator was satisfied that the landlord had fulfilled the settlement terms. Some of the tenants objected to the quality and scope of some of the repairs and so a two-day bilingual trial was held.

In June, the court referee who decided the case ruled that several of the tenants’ objections were valid and that some repairs were incomplete. However, the referee stopped short of ordering the landlord to complete repairs according to the tenants’ recommended specifications. “That’s one downfall of the rent escrow statutes in general … a tenant can’t necessarily dictate the means of repair if they identify the problem and a landlord fixes it — whether it’s the way the tenant would have fixed it, it’s not really up to the tenant to make that call as long as the problem is resolved, at least for the time being,” Zwak said.

Ultimately, most of the referee’s decision sided with the tenants and Zwak acknowledged it was beyond perhaps what the court might have awarded in a typical post-trial order. Zwak also noted the unique feature of the case — multiple tenants banding together — also created the challenge of getting tenants on the same page. Despite these challenges, the tenants’ tenacity and commitment to securing justice in their cases forced the landlord to make many significant repairs.

Read more about these cases and about Minnesota’s rent escrow history in MinnPost’s Determined south Minneapolis tenants fought for repairs in their apartment building: inside a ‘rent escrow’ case.”