The Joplin Globe, Joplin, MO

Local News

July 13, 2011

State accuses landlord of price gouging

JOPLIN, Mo. — Vincent Valenti recalls his landlord coming to his door at the Northside Apartments in Joplin the week following the May 22 tornado.

The landlord had a new lease in his hand and said he had to sign it or move out, according to Valenti. The new lease called for rent of $550 per month for his two-bedroom apartment, up from $475.

“But my lease was up, and he raised it $75 per month,” Valenti said.

He said he did not have much choice and went ahead and signed the new 12-month lease. But he felt at the time that the landlord was taking advantage of the scarcity of rental properties in the Joplin area created by the tornado, he said.

Valenti said that’s why he was glad to hear a couple of weeks ago that the Missouri Attorney General’s Office might take action against his landlord, David Box Jr. That action came Wednesday in the form of a lawsuit filed in Jasper County Circuit Court on behalf of tenants at Northside Apartments on North Range Line Road in Joplin, and at Classic Town Homes in Webb City.

Box Properties owns both apartment complexes and others in the Joplin area.

13 RENTER COMPLAINTS

Attorney General Chris Koster said at a news conference in the emergency operations command center in Joplin that the lawsuit alleges price gouging and other violations by Box in the aftermath of the tornado. He said his office received complaints from renters of 13 apartments in the two complexes regarding notices of rental increases they received.

For example, one renter received a notice that his rent was increasing to $595 per month from $475, a 25 percent hike, Koster said. Two other renters were informed of 16 percent increases from $475 per month to $550, he said.

The notices reportedly read: “This price is based on a 12-month lease and will go into effect with or without your signature on the renewal 30 days from this notice.”

The notices provided some leasing options for shorter periods than a full year, with proportionally higher rent increases the shorter the lease period chosen. They further required that tenants inform the landlord within three days of their decision or their apartment could be leased to someone else, the attorney general said.

“This is against state law to treat people this way,” Koster said.

He said both the law and some of the landlord’s own leases with his tenants require at least 30 days’ notice for rent increases.

Normally, Koster said, rent hikes are not a violation of the state’s merchandising practices law. When the state or federal government have designated a disaster area, there are prohibitions against price gouging that kick in, he said. In general, state law prohibits increases in prices for consumers in disaster areas without corresponding increases in the costs of a merchant or vendor, he said.

Koster said his office and others in Jefferson City decided early in the state’s response to the tornado in Joplin that a strong stance needed to be taken against those who would try to take advantage of storm victims and other consumers in the area.

“We didn’t want aggressive economics to cost other people their safety and shelter,” Koster said.

The lawsuit seeks an order for a permanent injunction against Box to keep him “from engaging in unlawful, unfair and deceptive practices,” and asks that he be required to make full restitution to any tenants harmed by such practices. The state also is seeking a civil penalty of $1,000 per violation and payments to the state amounting to 10 percent of any restitution order, plus court and investigative costs.

51 RENT ISSUES

The attorney general said the complaints received from tenants in the two apartment complexes were among 51 complaints received from the Joplin area regarding rent issues in the wake of the tornado. Of those, he said, 30 complaints have been resolved.

David Box did not return calls seeking his comments for this report.

Josh Grissom, a tenant of Apple Tree Townhouses at 2911 W. 14th St., was surprised to hear that his apartment complex was not made part of the lawsuit. Box Properties also owns the complex Grissom lives in with his wife and two preschool children.

Grissom acknowledged being one of those who complained to the attorney general’s office after a notice of a rent increase was taped to his door June 25. He said the notice called for a $70 increase in rent.

“That’s a pretty hard hit, because my wife stays at home with our two kids and I work for my parents’ landscaping business, which has been a pretty rough go with there not being a whole lot of work right now,” he said.

He finds Box Properties’ attempts to raise rent in its complexes at this time “distasteful” at best.

“I don’t see how trying to bully someone into a new contract can be legal,” he said.

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