In April 2026 the Supreme Judicial Court upheld a class action settlement for tenants who were charged rental application fees and lock change fees. The court held that late notice to the Massachusetts IOLTA Committee, which may ask for leftover settlement money, did not require undoing the settlement because the committee was not harmed. This is a published decision of the Supreme Judicial Court and binding statewide.
What happened
Two former tenants sued the owner and manager of an apartment complex in Superior Court. They claimed the landlord broke the security deposit statute, G.L. c. 186, § 15B, by charging rental application fees and excessive lock change fees, and that this was also an unfair practice under G.L. c. 93A. The court certified a class. After the landlord was sanctioned for discovery violations and barred from contesting certain liability facts, the judge granted summary judgment to the tenants on liability under § 15B, but not on the c. 93A claims. On the eve of trial, the parties settled. Each class member who filed a valid claim would get between 100 and 200 percent of the fees they paid. Only about 220 class members filed claims, and they received about $51,000 in total.
The settlement let part of the unclaimed money go back to the landlord, capped at $500,000, with the rest going to two affordable housing charities. The IOLTA Committee, which funds civil legal aid, was not told about the settlement until more than two years after final approval. It objected, but a judge approved the final distribution anyway.
What the court decided
The SJC affirmed in Ortins v. Lincoln Property Company, SJC-13777 (Mass. April 14, 2026).
Massachusetts Rule of Civil Procedure 23 (e) (3) says that where residual funds may remain, no class judgment or settlement may be approved unless the plaintiff has notified the IOLTA Committee so it can be heard on whether it should receive those funds. The court made three rulings:
- Standing. The committee may appeal the denial of its right to notice and a hearing. It may not attack the overall fairness of the settlement. Protecting absent class members is the settlement judge’s job. See Sniffin v. Prudential Ins. Co. of Am., 395 Mass. 415 (1985).
- Violation assumed. The court assumed, without deciding, that the rule applied to this “claims-made” settlement, because the landlord paid money into a fund up front and the deal planned for leftover funds. On that assumption, the late notice violated the rule.
- No prejudice. Not every procedural violation requires vacating a judgment. The committee was eventually heard on the exact question the rule lets it address. Nothing in the record suggested earlier notice would have changed the result. The settlement judge had already pushed back on the reversion to the landlord and on the choice of charities.
The court stressed that compliance with the notice rule is mandatory. Trial judges should confirm at the approval stage that the committee received timely notice.
What this means for you
The SJC did not decide whether these fees were legal. That ruling came from the trial court, and the landlord was barred from contesting some facts as a discovery sanction. Still, the case is a reminder of what the statute says. At or before the start of a tenancy, a landlord may not require more than first month’s rent, last month’s rent, a security deposit equal to one month’s rent, and the purchase and installation cost of a key and lock. G.L. c. 186, § 15B. Section 15B does not list any other upfront fee among the permitted charges.
Many unlawful fee cases are small for one tenant but large across a building. Chapter 93A lets an injured person sue on behalf of others who were harmed the same way, with court approval of any settlement. G.L. c. 93A, § 9.
There is also a practical lesson. In this settlement, only about 220 class members filed claims, and about $500,000 of the money deposited went back to the landlord. If you get a class action notice about your apartment, read it and file your claim form before the deadline. Money you do not claim may never reach you.
What to do now
- Find your lease, move-in receipts, and bank records showing every fee you paid before or at move-in.
- Compare those charges with the four items § 15B allows.
- Keep any receipt for a lock change and what you were charged for it.
- If you receive a class action notice, file the claim form on time and keep a copy.
- Talk to a lawyer about whether your claim can be brought for you alone or for a group of tenants.
If this is your situation, call Doubleday Law at (617) 575-2006 or tell us what happened. Housing Court deadlines are short.
Prior results do not guarantee a similar outcome.
