An early case on the implied warrantee of habitability is Lemle v Breeden, Supreme Court of Hawaii (1969), 51 Hawaii 426, 51 Hawaii 478, 462 P.2d 470, 40 A.L.R. 3d 637. The implied warrantee found by the court included the absense of rats--even though the owner had occupied the premises before the tenant moved in and the agent of the owner attempted to deal with the problem. It was not clear whether the rats came from the house or from the outside.
Defenses of the shift from caveat emptor/freedom of contract to the implied warrantee of habitability can be found in Pugh v. Holmes, Supreme Court of Pennsylvania (1979) 486 Pa. 272, 405 A. 2d 897 and Javins v. First National Realty Corporation, United States Court of Appeals, District of Columbia Circuit, 1970. 428 F.2d 1071, cert. den., 400 U.S. 925 , 91 S.Ct. 186 , 27 L.Ed.2d 185 (1970). In the latter case, the Court of Appeals, J. Skelly Wright, Circuit Judge, held that the warranty of habitability, measured by the standard set out in the Housing Regulations for the District of Columbia, is implied by operation of law in all leases, whether oral or written and for all types of tenancies, of urban dwelling units covered by those regulations and that breach of such warranty gives rise to usual remedies for breach of contract. May 7, 1970.
The California Supreme Court adopted the implied warrantee of habitability in Green V. Superior Court, 10 Cal.3d 616 , 111 Cal. Reptr. 704 , 517 P.2d 1168 (1974)
For an academic discussion of the rise of the doctrine, see:
Rabin, "The Revolution in Residential Landlord-Tenant Law: Causes and Consequences, 69 Cornell L. Rev. 517 (1984).