ANCHORAGE, Alaska (Legal Newsline) - An Alaska housing authority must pay $3 million to a man and his family because the authority didn’t continue to inspect a boiler in a house after the man had fully paid for it, the Alaska Supreme Court ruled. The state’s high court rejected arguments the home buyers were responsible for maintaining the house and that the state’s $1 million damages cap should apply to the entire award.
Dietrich Mael was seriously injured in 2016 after his mother told him to investigate a whistling noise coming from the 30 year-old boiler in their house and it exploded, throwing him against a wall and spraying him with scalding water and glycol.
The Maels moved into the home in Chefornak in 1984 under an agreement with the Association of Village Council Presidents Regional Housing Authority that shared responsibility for maintaining the house until they had paid it off through a 25-year lease arrangement. The Maels finished paying for the house in 2009 but the housing authority never formally transferred title and they kept paying administrative fees.
Dietrich Mael sued the authority on behalf of himself and his children, who heard the explosion and claimed mental distress. The authority moved to dismiss the case, arguing any obligation they had to inspect the home ended when it had been paid off. The trial judge rejected that argument, telling the jury that the housing authority had a continuing duty to inspect the home as long as it shared ownership with the occupants.
After a nine-day trial in 2019, the jury awarded more than $3 million in damages including $1.6 million in noneconomic damages and separate awards to the family members. The court reduced Mael’s damages to $1 million under Alaska’s cap for pain and suffering awards, but kept the separate awards to family members intact.
The housing authority appealed but the Alaska Supreme Court, in an April 15 decision, upheld the verdict.
Stating it was “ancient learning that one who assumes to act, even though gratuitously, may
thereby become subject to the duty of acting carefully,” the court said it was reasonable for the jury to conclude the housing authority had a continuing obligation to inspect and repair the boiler even after the house was paid off. The home was never formally conveyed to the Maels, the authority never told them they had to purchase it, and neither party ever told the other the contract between them was terminated, the court said.
The housing authority argued the boiler manufacturer was to blame for a defective design (it settled with the plaintiffs) and the Maels themselves bore some blame for attempting to service it themselves.
A housing authority employee testified there was rust on the pressure relief valve indicating it hadn’t been maintained, however, and said the authority was supposed to continue inspections and repairs even after a house was eligible for conveyance. An expert in boiler repair testified ordinary homeowners don’t know how to service a boiler and a label on the pressure relief valve says it should be removed and physically inspected by a licensed plumber every three years.
An Indian housing expert said every housing authority he’d worked with limited their responsibility to fixing known hazards, and boiler maintenance was up to the home occupants.
But the court trial rejected this interpretation and told jurors the housing authority had a duty to conduct regular boiler inspections as long as it had an interest in the home.
To support the conclusion the authority had a duty to inspect, the state Supreme Court cited a case where an insurer was potentially liable for failing to detect conditions that led helicopter pilots to be dangerously overworked. Federal law also states that failure by home buyers to properly maintain their houses “shall not relieve the IHA of responsibility in this respect.” The law requires housing authorities to complete yearly interior and exterior inspections and “remedy conditions shown by the inspection.”
The housing authority continued to inspect the home until 2011, two years after it was paid off, but called that a mistake. The Maels acknowledged they didn’t inspect the home for five years after that, and said they did their own maintenance on the boiler. But they continued to pay administrative fees to the housing authority and might have assumed the contract was still effective, the court said.
“Five years without inspections may be long enough for the Maels to have reasonably understood that there would be no more, and there was little evidence that the Maels ever inquired about their status,” the court concluded. “But other testimony indicated that inspections were always initiated by the housing authority; the Maels typically waited for the housing authority to act without prompting, and the jury could conclude that this conduct was consistent with the housing authority’s retention of the duty.”