Class-action rental suit settled in Iowa City

A rental property managed by Apartments Downtown on South Gilbert Street in Iowa City is shown last week. The rental agency has reached a class-action lawsuit filed on behalf of tenants. PHOTO/CHASE CASTLE

By Chase Castle

Apartments Downtown, one of the largest rental agencies in Iowa City, has reached a settlement with plaintiffs in a class-action lawsuit that alleged the rental agency billed its tenants for charges contrary to state law.

Originally filed in late 2010, the case alleged multiple violations of the Uniform Residential Landlord and Tenant Act, first created in 1972 and adopted in Iowa seven years later, which governs the rights of both tenants and landlords.

In the settlement Judge Chad Kepros of the Sixth District of Iowa determined that each former tenant who resided at Apartments Downtown properties for at least one year between 2010 and 2012 will receive $65 for each year of tenancy. That figure was based on the most widespread claim against the company that it automatically withheld security deposit funds comparable to that amount in the form of a carpet cleaning fee.

According to Christopher Warnock, an attorney representing the tenants in the case, $65 was a “compromise” that accounted for the variance in size of the charge, depending on the square footage and rent of the apartment, as well as the landlord’s claims that some tenants’ carpets legitimately required and were subject to cleaning or replacement.

Close to 14,000 tenants and subtenants of Apartments Downtown and affiliated operations under Apartments Near Campus are now eligible for the payments, although Mr. Warnock said only a fraction of those eligible are likely to pursue compensation. In total, he estimated $500,000 or less would ultimately be paid out, likely over several years.

As part of an agreed upon complaint process, current and future tenants of Apartments Downtown are expected address maintenance needs or other concerns related to their unit with their landlord, who has 10 business days to resolve the complaint. If the complaint is not resolved, the tenants may contact Mr. Warnock, who will first informally try to resolve the issue and, if necessary, represent the tenants in court at the expense of the landlord.

“While the class action settlement is great, I am even more excited about the complaint process,” Mr. Warnock said in a news release. “We see this as a new partnership between landlords and tenants.”

Apartments Downtown, which is based at 414 E. Market St. in Iowa City, is owned by James A. Clark, according to state records. The company also operates as Apartments at Iowa.  Apartments Downtown representatives could not be reached for comment.

Mr. Warnock said the case is significant for striking the legality of fees built into tenant leases, and said landlords observing the case must remove such clauses from lease templates. Active leases with clauses identifying automatic charges do not need to be rewritten, he said, but landlords using such leases should notify tenants in writing that those clauses will not be enforced.

“Just be up front with your tenants, let them know, and then you’re fine and off the hook,” Mr. Warnock said.

The deadline for former tenants to submit claims is Nov. 15. Former tenants must provide the year of tenancy, the mailing or street address of the building and preferably the unit number. To submit a claim, visit

The case is Michael Conroy vs. Apartments Downtown Inc.