Since shortly after the start of the COVID-19 pandemic, federal, state, and municipal governments have implemented a number of programs, many of them of dubious legality. Perhaps most notable of all, the Center for Disease Control attempted to block landlords from evicting tenants in any area deemed to be high-risk for COVID-19 transmission across the country before the Supreme Court effectively nullified this program. Attorney Lane Bogard analyzes the issues at play.
Overview of eviction moratoria and whom they affect The Rise and Fall of the Federal CDC Eviction Moratorium Throughout the COVID-19 pandemic, a huge number of government voices, ranging from the Center for Disease Control and Prevention (“CDC”), to state and local public health departments, repeatedly insisted that evicting tenants for failure to pay rent could have a negative impact on efforts to slow the spread of the virus.[1] As a result, the CDC issued an agency order, entitled, “Temporary Halt in Residential Evictions to Prevent the Further Spread of COVID-19” (the “CDC Order”),[2] which went into effect on September 4, 2020 and was effective through the end of that year. The CDC order provided that a “landlord, owner of a residential property, or other person[] with a legal right to pursue eviction or possessory action,” was prohibited from “evicti[ng] any covered person from any residential property in any jurisdiction to which th[e] Order applies during the effective period of the Order” for non-payment of rent.[3] In other words, under the CDC Order, any landlord who would ordinarily be entitled to evict a tenant was prohibited from doing so (provided the tenant was a “covered” person, a term whose meaning was changed at times throughout the duration of the moratorium, but which included a potentially enormous number of tenants). However, upon the expiration of the CDC Order, the expected relief for landlords failed to materialize. Congress instead extended the moratorium through January 31, 2021.[4] Then the CDC, acting on its own authority, extended the moratorium through March 2021. Then June 2021. And then July 2021.[5] Finally, when the CDC attempted to extend the moratorium yet again – this time to October 3, 2021 – they were stopped in their tracks.[6] As explained below, landlords fought back against this order, taking it all the way to the United States Supreme Court, which ruled in their favor. After the U.S. District Court for the District of Columbia found in favor of the landlords, the CDC sought a stay of judgment while it prepared an appeal of the decision. On August 26, 2021, however, the Supreme Court vacated the stay on the grounds that the CDC had no reasonable expectation of winning on appeal, thereby effectively ending the Federal government’s attempts to issue nationwide eviction bans.[7] The reasoning laid out in the opinion of the Court is instructive, and we will examine it shortly. State and Local Eviction Moratoria Not long after the Federal government issued its eviction moratorium, state and local governments followed suit. In California, Governor Gavin Newsom issued an executive order authorizing local governments to halt evictions for failure to pay rent.[8] In addition, the California State Legislature passed the California's Tenant, Homeowner and Small Landlord Relief and Stabilization Act of 2020 (AB 3088) (the “California Eviction Moratorium”). Under the California Eviction Moratorium, landlords were prohibited (among other restrictions) from evicting residential tenants for non-payment of rent before January 31, 2021.[9] Just before that order was set to expire in January, Governor Newsom signed a bill (SB 91) that extended the eviction moratorium in AB 3088 through June 30, 2021, making use of the extension to add even more restrictions on landlords.[10] Then, apparently feeling that anything worth doing two times is worth doing three, again before the order expired in June, Governor Newsom signed a third bill (AB 832) that again extended the eviction moratorium and restrictions from AB 3088 and SB 91 and added still more requirements for landlords set to expire at the end of September 2021.[11] In addition to the eviction moratoria at state level, local governments, such as the city of Los Angeles, have also imposed restrictions on landlords’ rights to evict non-paying tenants. The City of Los Angeles passed Local Ordinance No. 186,585 on March 4, 2020 and Local Ordinance No. 186,606 on May 12, 2020.[12] These ordinances (the “LA Eviction Moratorium”) were later “codified at sections 49.99 through 49.99.9 of the Los Angeles Municipal Code”[13] Pursuant to the LA Eviction Moratorium, the City of Los Angeles went further than the State of California and Federal Government and imposed a ban on evictions of both residential and commercial tenants.[14] This LA Eviction Moratorium is still in effect as of September 27, 2021.[15] The actions of the federal, state, and local governments, while presumably having a positive impact on certain tenants, have undoubtedly affected the constitutional rights of property owners. There is no dispute that COVID-19 has had a severe impact on all of the victims, victims’ families, and health care provides – indeed, in an indirect sense, every person in America, if not the world, has been affected. However, the severity of the problem that a government action is intended to address has no bearing on the legality of that action. The United States Constitution must govern the laws imposed on citizens of the United States, irrespective of the good intentions of the government. The issue is not whether the COVID-19 pandemic is a real threat that continues to persist, but whether the actions of the government in taking measures to control COVID-19 by imposing restrictions on property owners are constitutional. As we will see, there are several good reasons to believe that they are not. The actions of the federal government are unconstitutional Necessary and Proper Clause and Exceeding Authority Article 1 of the United States Constitution gives Congress the power “to make all laws which shall be necessary and proper for carrying into execution the foregoing powers, and all other powers vested by this Constitution in the government of the United States, or in any department or officer thereof.” Therefore, pursuant to the Article 1 powers, Congress may: [C]reate federal agencies and individual offices within those agencies, design agencies’ basic structures and operations, and prescribe, subject to certain constitutional limitations, how those holding agency offices are appointed and removed. Congress also may enumerate the powers, duties, and functions to be exercised by agencies, as well as directly counteract, through later legislation, certain agency actions implementing delegated authority.[16] However, there are limits to Congress’s power to delegate authority. As we will discuss in more detail later, Congress cannot delegate authority that it does not, itself, possess, and it is questionable whether Congress could impose a blanket prohibition on evictions, in any case. Additionally, because the Constitution grants legislative powers to Congress alone, any delegation of these powers must be done in such a way that Congress remains in genuine control over its agents (in this case, the CDC). This concept is often known as the “doctrine of non-delegation.” As noted earlier, the CDC Eviction Moratorium was essentially held to be illegal by the United States Supreme Court in the case Alabama Ass'n of Realtors v. Dep't of Health & Hum. Servs., No. 21A23, 2021 WL 3783142, at *1 (U.S. Aug. 26, 2021), on the basis that the CDC acted beyond the scope of the authority granted to it by Congress. In the Alabama Ass’n of Realtors case, the CDC argued that it possesses the power to enact the CDC Eviction Moratorium pursuant to section 264(a) of Title 42 of the United States Code (referred to as section 361(a) of the Public Health Service Act), because this law allows the following: The Surgeon General, with the approval of the [Secretary of Health and Human Services], is authorized to make and enforce such regulations as in his judgment are necessary to prevent the introduction, transmission, or spread of communicable diseases from foreign countries into the States or possessions, or from one State or possession into any other State or possession. For purposes of carrying out and enforcing such regulations, the Surgeon General may provide for such inspection, fumigation, disinfection, sanitation, pest extermination, destruction of animals or articles found to be so infected or contaminated as to be sources of dangerous infection to human beings, and other measures, as in his judgment may be necessary.[17] The CDC, relying on the phrase “other measures, as… may be necessary,” argued that it has statutory authority to regulate evictions if the regulation is necessary to prevent the spread of COVID-19. “Realtor associations and rental property managers in Alabama and Georgia sued to enjoin the CDC's moratorium,” arguing that CDC Eviction Moratorium was unconstitutional on the basis that the CDC did not have the requisite statutory authority to impose the ban and thus the CDC exceeded the scope of authority granted by Congress[18] The opinion of the Supreme Court explained that, because the statute delineates certain measures which the CDC may take to prevent the spread of disease, the phrase “other measures as may be necessary” covers only actions essentially similar to those specifically named - “inspection, fumigation, disinfection, sanitation, pest extermination, and destruction of contaminated animals and articles,” and must “directly relate to preventing the interstate spread of disease by identifying, isolating, and destroying the disease itself.” The Court went on to find that the “CDC's moratorium . . . relates to interstate infection far more indirectly: If evictions occur, some subset of tenants might move from one State to another, and some subset of that group might do so while infected with COVID–19.” Therefore, “it is a stretch to maintain that § 361(a) gives the CDC the [broad and vast] authority to impose this eviction moratorium.” The Supreme Court added: It is indisputable that the public has a strong interest in combating the spread of the COVID–19 Delta variant. But our system does not permit agencies to act unlawfully even in pursuit of desirable ends. Cf. Youngstown Sheet & Tube Co. v. Sawyer, 343 U.S. 579, 582, 585–586, 72 S.Ct. 863, 96 L.Ed. 1153 (1952) (concluding that even the Government's belief that its action “was necessary to avert a national catastrophe” could not overcome a lack of congressional authorization). It is up to Congress, not the CDC, to decide whether the public interest merits further action here.[19] In short, the Court affirmed that government agencies cannot act outside the scope of authority specifically granted to them by Congress. Accordingly, if the federal government wishes to impose regulations such as an eviction moratorium, it must do so through legislation that either explicitly orders such action or grants agencies the clear and explicit authority to take such action. As far as it goes, the Court’s reasoning here is based strictly upon the interpretation of a specific statute on its own terms, but it is easy to see the doctrine of non-delegation lurking in the background: to the extent that the statute does, in fact, grant far-reaching discretionary powers to the CDC, it may be unconstitutional insofar as such a grant would erode Congress’s effective control over the CDC and thereby cede legislative powers to a party other than Congress. Commerce Clause While not addressed by the Supreme Court in Alabama Ass'n of Realtors v. Dep't of Health & Hum. Servs., No. 21A23, 2021 WL 3783142, at *1 (U.S. Aug. 26, 2021), the CDC Order is also arguably unconstitutional pursuant to the Commerce Clause. Article 1 of the United States Constitution also gives Congress the power to “to regulate commerce with foreign nations, and among the several states, and with the Indian tribes.” [This] commerce power allows regulation of three categories of activity: (1) ‘the use of the channels of interstate commerce’; (2) ‘the instrumentalities of interstate commerce, or persons or things in interstate commerce’; and (3) ‘those activities having a substantial relation to interstate commerce, ... i.e., those activities that substantially affect interstate commerce.’[20] The Sixth Circuit Court of Appeals addressed a constitutional challenge to the CDC Order and found that the “[r]eal estate is inherently local. Residential buildings do not move across state lines. And eviction is fundamentally the vindication of the property owner's possessory interest.”[21] Therefore, the CDC Order violated the Commerce Clause because the halt on lacked a substantial relation to interstate commerce. Thus, the eviction moratorium cannot be a legitimate exercise of the CDC’s authority, since Congress is not empowered to regulate commercial activities that take place exclusively within a given state and accordingly, as noted earlier, cannot delegate such authority to the CDC. The actions of state and local governments are unconstitutional Much like the order issued by the CDC, the eviction moratoria passed by state and local governments are arguably unconstitutional on several bases. Contracts Clause The Ninth Circuit has addressed a challenge to the constitutionality of the LA Eviction Moratorium under the Contracts Clause in the case Apartment Ass'n of Los Angeles Cty., Inc. v. City of Los Angeles, 10 F.4th 905 (9th Cir. 2021). The Contracts Clause set forth in Section 10 of Article 1 of the United States Constitution provides that “No State shall ... pass any ... Law impairing the Obligation of Contracts.” The original aim of the Contracts Clause was to prevent “legislation that was designed to repudiate or adjust preexisting debtor-creditor relationships that obligors were unable to satisfy.” [22] The Ninth Circuit explained that, in light of the Supreme Court case, Sveen v. Melin, 138 S. Ct. 1815 (2018), there is a two-step inquiry to determine whether a state law is unconstitutional for violating the Contracts Clause. Under Sveen’s formulation, “[t]he threshold issue is whether the state law has ‘operated as a substantial impairment of a contractual relationship.’ ” Id. (quoting Allied Structural Steel Co. v. Spannaus, 438 U.S. 234, 244, 98 S.Ct. 2716, 57 L.Ed.2d 727 (1978)). Factors relevant to that consideration include “the extent to which the law undermines the contractual bargain, interferes with a party's reasonable expectations, and prevents the party from safeguarding or reinstating his rights.” Id. at 1822. If the law is a substantial impairment, then “the inquiry turns to the means and ends of the legislation.” Id. At that point, a court must determine whether the law is drawn in an “ ‘appropriate’ and ‘reasonable’ way to advance ‘a significant and legitimate public purpose.’ ” Id. (quoting Energy Reserves, 459 U.S. at 411–12, 103 S.Ct. 697). A heightened level of judicial scrutiny is appropriate when the government is a contracting party. U.S. Trust Co. of N.Y. v. New Jersey, 431 U.S. 1, 25–26, 97 S.Ct. 1505, 52 L.Ed.2d 92 (1977). But when the government is not party to the contract being impaired, “courts properly defer to legislative judgment as to the necessity and reasonableness of a particular measure.” Energy Reserves, 459 U.S. at 413, 103 S.Ct. 697 (quotations omitted); see also Keystone Bituminous, 480 U.S. at 505, 107 S.Ct. 1232; Lazar v. Kroncke, 862 F.3d 1186, 1199 (9th Cir. 2017).[23] Under the two-step inquiry, the Ninth Circuit explained that even if the LA Eviction Moratorium substantially impairs the contractual relations between landlords and tenants, the moratorium would be constitutional and upheld “if the [moratorium’s] ‘adjustment of the rights and responsibilities of contracting parties is based upon reasonable conditions and is of a character appropriate to the public purpose justifying the legislation's adoption.’”[24] The Ninth Circuit ultimately found that the Apartment Association did not prove that the restrictions imposed in the LA Eviction Moratorium “were not ‘appropriate and reasonable’” under the circumstances. While the Ninth Circuit Court of Appeals held the LA Eviction Moratorium was constitutional under the Contracts Clause, the holding was based on the property owners failing to show that the specific regulations and restrictions imposed by the moratorium were not appropriate and reasonable. However, if different and/or more restrictive regulations are imposed on landowners in California, a challenge based on the Contracts Clause could very well prevail. Takings Clause In Apartment Ass'n of Los Angeles Cty., Inc. v. City of Los Angeles, 10 F.4th 905 (9th Cir. 2021), the Ninth Circuit did not address arguments that the LA Eviction Moratorium violated the Takings Clause. The Takings Clause is set forth in the Fifth Amendment of the U.S. Constitution and provides that “private property [shall not] be taken for public use, without just compensation.”[25] While originally referring specifically to federal laws, this Takings Clause explicitly applies to state law, as well, due to the provisions of the Fourteenth Amendment.[26] Therefore, a State must not make laws that take private property for public use without just compensation. The Ninth Circuit did not address arguments that the LA Eviction Moratorium violated the Takings Clause, but possible challenges exist on that front, as well. Under the local and state eviction moratoria that remain in place, property owners can argue that the ban on recovering property (including physical possession of the rental property and money owed for rent) is a regulatory taking that is unconstitutional without just compensation. Know Your Rights As outlined above, there are many constitutional challenges that can reasonably be made to federal, state, and local eviction moratoria. In addition to the challenges discussed above, there may also be challenges based on other Constitutional provisions, such as the Tenth and Fourteenth Amendments. Therefore, if you believe a local, state, or federal law and/or order infringes on your property rights, you must consider whether a local, state, or federal restriction on your property rights is constitutional under at least the following: · Article 1 of the U.S. Constitution – Necessary and Proper Clause and Statutory Powers of Agencies · Article 1 of the U.S. Constitution – Commerce Clause · Article 1 of the United States Constitution - Contracts Clause · Takings Clause of the Fifth and Fourteenth Amendments · Due Process Clause of the 14th Amendment
The Lex Rex Institute is experienced in bringing Constitutional litigation and has a proven track record of success on claims of this sort. LRI is eager to vindicate the rights of landlords on matters related to the eviction moratoria described in this article and on related matters, and we encourage those whose rights have been violated us to contact us for legal help as soon as possible.
[1] See, e.g., CDC Issues Eviction Moratorium Order in Areas of Substantial and High Transmission, Press Release (Tuesday August 3, 2021), https://www.cdc.gov/media/releases/2021/s0803-cdc-eviction-order.html. [2] See 85 Fed. Red. 55292 (2020). In addition to the CDC Order, Congress took steps to also place other limitations on evictions and landlords’ rights through the CARES Act. See CARES Act § 4024. [3] 85 Fed. Red. 55292 (2020). [4] See Consolidated Appropriations Act, 2021, Pub. L. 116–260, § 502, 134 Stat. 2078–2079. [5] See, e.g., 86 Fed. Reg 8020 (2021). [6] This last order was more limited and “imposed a nationwide moratorium on evictions of any tenants who live in a county that is experiencing substantial or high levels of COVID–19 transmission and who make certain declarations of financial need.” Alabama Ass'n of Realtors v. Dep't of Health & Hum. Servs., No. 21A23, 2021 WL 3783142, at *1 (U.S. Aug. 26, 2021); 86 Fed. Reg. 43244 (2021). [7] See Alabama Ass'n of Realtors., No. 21A23, 2021 WL 3783142, at *1. [8] See Governor Newsom Issues Executive Order to Protect Renters and Homeowners During COVID-19 Pandemic (published March 16, 2020), https://www.gov.ca.gov/2020/03/16/governor-newsom-issues-executive-order-to-protect-renters-and-homeowners-during-covid-19-pandemic/; see also Cal. Executive Order No-28-20. [9] See New Laws Apply to Eviction Cases https://www.courts.ca.gov/44660.htm?rdeLocaleAttr=en; see also AB 3088: California Eviction Protections (September 3, 2020), https://www.bbklaw.com/news-events/insights/2020/legal-alerts/09/ab-3088-california-eviction-protections. [10] See New Laws Apply to Eviction Cases https://www.courts.ca.gov/44660.htm?rdeLocaleAttr=en. [11] See New Laws Apply to Eviction Cases https://www.courts.ca.gov/44660.htm?rdeLocaleAttr=en. [12] See Apartment Ass'n of Los Angeles Cty., Inc. v. City of Los Angeles, 10 F.4th 905 (9th Cir. 2021). [13] See Apartment Ass'n of Los Angeles Cty., Inc., 10 F.4th at 905. [14] In addition to the City of Los Angeles imposing an eviction moratorium, counties across California have imposed similar bans. For example, Los Angeles County has passed a moratorium banning evictions effective March 4, 2020 to September 31, 2021. See, e.g., Los Angeles County Temporary Eviction Moratorium for Residential Tenants, https://dcba.lacounty.gov/wp-content/uploads/2021/06/RSU_Residential-EM-6.22.21-1-2.pdf [15] See Apartment Ass'n of Los Angeles Cty., Inc., 10 F.4th at 905. [16] Congress’s Authority to Influence and Control Executive Branch Agencies, https://sgp.fas.org/crs/misc/R45442.pdf [17] Alabama Ass'n of Realtors, No. 21A23, 2021 WL 3783142, at *1 (quoting 42 U.S.C. § 246(a)) (citing 42 C.F.R. § 70.2 (2020)). [18] Id. at *3. [19] Id. at *4. [20] Terkel v. Centers for Disease Control & Prevention, No. 6:20-CV-00564, 2021 WL 742877, at *4 (E.D. Tex. Feb. 25, 2021) (quoting United States v. Lopez, 514 U.S. 549, 558-59 (1995)). [21] Id. at *6. [22] U.S. Const., Art. 1, § 10. [23] Apartment Ass'n of Los Angeles Cty., Inc. v. City of Los Angeles, 10 F.4th 905 (9th Cir. 2021). [24] Id. [25] U.S. Const. Amend. V. [26] See Chicago, B. & Q.R. Co. v. Chicago, 166 U.S. 226, 17 S.Ct. 581, 41 L.Ed. 979 (1897).
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