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US Court of Appeals Holds CDC Eviction Moratorium Likely Invalid

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In September 2020 the Center for Disease Control (CDC) issued a nation-wide eviction moratorium,  citing generic rulemaking authority under the Public Health Service Act. The same month, landlords in Tennessee filed a lawsuit in federal court arguing that the CDC eviction moratorium exceeded statutory authority.

The Public Health Service Act statute authorizes the CDC Director to provide for “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.” The CDC based its authority to supersede state law and halt evictions nation-wide on the “other measures” catchall.

Later, Congress extended the CDC eviction moratorium from December 31 to January 31. On January 29, the CDC extended the eviction moratorium through March 31, relying again on the generic catchall as authority.

The federal district court ruled that the CDC had exceeded its statutory authority. The government appealed and moved for a stay on the district court’s order.[1] The Sixth Circuit Court of Appeals concluded that the government was unlikely to prevail on the merits, and denied the motion.[2]

The Court reasoned that as the “other measures” catchall comes at the end of a list of specific items, the “other measures” catchall must be construed to be of the same nature as the specified items like “inspection, fumigation, disinfection, sanitation, pest extermination” and so on. “Plainly, government intrusion on property to sanitize and dispose of infected matter is different in nature from a moratorium on evictions.”

The Court noted that regulation of the landlord-tenant relationship has historically always been the province of the states, and the Court would not read the statute as granting the CDC power to insert itself in a traditional area of state law without “some clear, unequivocal textual evidence of Congress’s intent to do so.” The Court cited an “ordinary rule of statutory construction that if Congress intends to alter the usual constitutional balance between the States and the Federal Government, it must make its intention to do so unmistakably clear in the language of the statute.”

The government argued that since other provisions of the Public Health Service Act allow the CDC to enforce quarantines, the “other measures” catchall must be read broadly to include things like quarantine. The Court conceded that this argument has “cosmetic appeal” but concluded that it does not hold up to scrutiny. The Court reasoned that the provision the government relied upon dealt with limited power to restrict liberty by imposing quarantines. The “other measures” language is found in provisions dealing with property interest, and an eviction moratorium is radically different from the types of property interests listed there.

The government also argued that when Congress legislatively extended the CDC eviction moratorium it acknowledged that the statute authorized the moratorium. The Court noted that nothing in the congressional act expressly approved the CDC’s interpretation, and “mere congressional acquiescence in the CDC’s assertion” of statutory authority “does not make it so, especially given that the plain text indicates otherwise.”

The Court found the government unlikely to prevail on the merits, and accordingly denied the motion for a stay on the district court’s order.

[1] Tiger Lily, LLC v. US Dept. of Housing and Urban Development (6th Cir. No. 21-5256).

[2] See https://www.opn.ca6.uscourts.gov/opinions.pdf/21a0074p-06.pdf

Texas Federal Judge Hold CDC Moratorium Unconstitutional

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A federal judge in Texas has held the Centers for Disease Control eviction moratorium unconstitutional.[1]

In September 2020 the CDC issued a nation-wide residential eviction moratorium in response to the COVID-19 pandemic. The CDC eviction moratorium stopped evictions for non-payment. In Texas several landlords filed suit challenging the legal authority of the federal government to impose an eviction moratorium upon states.

The judge ruled that while states have the power to regulate residential evictions, the CDC moratorium exceeded federal authority to regulate interstate commerce. States have broad power to enact laws for the general public good—called ‘police power’—but the police power of the federal government is limited under the US Constitution.

The federal government has no general police power. The federal government must find authority either under an area reserved to it under the Constitution, such as the power to regulate interstate commerce.

The Court noted that the “federal government cannot say it has ever before invoked its power over interstate commerce to impose a residential eviction moratorium” and that the federal government had not done so during the Spanish Flu pandemic or the Great Depression. “The federal government has not claimed such a power at any point during our Nation’s history until last year.”

The government claimed broad constitutional authority. The federal government argued it had authority to issue suspend evictions even in the absence of a pandemic for any reason, including an agency’s views on “fairness.”

Note that the impact of this ruling is limited as it is the holding of a local federal district court judge, and even within its jurisdictional boundaries, the Court did not issue an injunction. Any landlord should consult with an attorney before acting, particularly as there are potential criminal penalties for violating the CDC moratorium.

An appeal is highly anticipated.

[1] Terkel et al. v. Center for Disease Control and Prevention, No. 6:20 -cv- 00564 (E.D. Texas February 25, 2021).

Evicted by Matthew Desmond, a Review

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A woman moves slowly, looking overcome as she answers the door for the sheriff deputy and moving-crew. A sob breaks through her face as she open the refrigerator and sees the movers have cleaned out everything, even the ice trays. At another eviction, the mother named in the court order had died two months prior. The children had gone on living in the rental by themselves with ratty mattresses and roaches scaling the walls. The landlord changed the locks. No one in the crew knew where the children would go, and they did not ask. A week earlier a man being evicted told the sheriff deputy to give him a minute. Then he shut the door and shot himself in the head.

In the Pulitzer Prize-winning Evicted Matthew Desmond paints a compelling portrait of the agonizing human toll eviction exacts. Desmond seasons anecdotes gleaned from living with landlords and tenants in Milwaukee’s low-income neighborhoods with enough data to show he has done his homework, but not too much to risk boring the reader.

Desmond’s non-judgmental approach lends much to his credibility. No zealot labeling good guys and bad guys, he instead writes that landlords are not “so different from the rest of us.” If given the same business “opportunity would any of us price an apartment at half of what it could fetch or simply forgive and forget losing thousands of dollars when the rent checks don’t arrive?” he rhetorically asks. At the same time, he writes candidly about some tenants being their own worst enemies with substance abuse and other issues.

The truth is far more nuanced than blaming some tenants for their own plight. Desmond argues that housing affordability and the resulting high eviction rate has gotten worse over several decades because of a complex web of public policies and socio-economic trends.

He shows how low-income people are at great risk of falling into a vicious cycle. If half or more of your income goes to housing, it is easy to fall behind—often for reasons that are not blameworthy at all. Once your behind if you find yourself under threat of eviction and take off from work to look for new housing, you lose income and are at greater risk of being fired. Displaced children fall behind in school and suffer emotional trauma, putting them in jeopardy of falling into a generational poverty trap. And so it goes.

So, do we reach for a Bolshevik abolishment of private rental housing? Hardly. Desmond recognizes that economic incentives to provide housing are a vital part of any solution. “If we are going to house most low-income families in the private rental market, then that market must remain profitable,” Desmond writes. Quoting a source from some 125 years ago, Desmond postulates “The business of housing the poor, if it to amount to anything, must be a business…As a charity, pastime, or fad, it will miserably fail, always and everywhere.”

He urges solutions such as no-cost legal representation for low-income tenants facing eviction, and universal housing vouchers to all who financially qualify, rather then putting most low-income applicants on a waiting list for housing vouchers as is done now. We do not put people on a waiting list for food stamps, nor do we vilify grocery stores for not handing out free food to the hungry.

Rather than display a partisan’s intransigence, Desmond acknowledges that the policies he advocates—like all policies—may have both pros and cons, and welcomes an honest debate. “Would a universal housing program be a disincentive to work? It is a fair and important question.”

Yet not addressing the housing crises, he urges, is far worse than possible side effects of universal housing vouchers and other possible solutions.

A compelling read, Evicted is the product of years of embedded research. The Gates Foundation has granted Matthew Desmond funds to continue research into the causes of high housing costs, even if lower-income areas. Could a sequel be in the works?

New York Eviction Moratorium Challenge Dismissed

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A federal judge struck down constitutional challenges to Governor Cuomo’s eviction moratorium orders.

The moratorium allows tenants to apply security deposits to rent provided the tenant replenishes the funds on a defined schedule, and temporarily prohibits landlords from starting an eviction against tenants facing financial hardship related to the pandemic.

The Governor’s Orders did not address then pending eviction cases, but as the Court pointed out the New York state courts closed in March and all eviction cases were suspended.

The first moratorium temporarily paused all evictions regardless of grounds.  A later order clarified that evictions on grounds other than non-payment against tenants experiencing financial hardships could proceed.

A group of landlords sued Governor Cuomo in federal court challenging the constitutionality of the orders on various legal theories. The Court dismissed the case in a summary judgment ruling.

The Court noted as background that evicting a tenant in New York, especially a residential tenant, is slow, cumbersome and extremely tenant-favorable process, especially when compared to analogous procedures in other states.

The Court noted several times in its opinion the temporary nature of the New York eviction moratorium. “[T]here is nothing permanent about [the eviction moratorium order]; it expires on August 19.”

The Court reasoned that the moratorium does not forgive rent, and landlords will be able to attempt to collect and/or evict tenants once the moratorium expires. “As long as the order is in place, tenants will continue to accrue arrearages, which the landlord will be able to collect with interest once the Order has expired. Furthermore, landlords will regain their ability to evict tenants once the Order expires.”

The Court pointed out that landlords “can still initiate eviction proceedings against the tenants who are not facing financial hardship but who have chosen not to pay their rent” and “will be able to move against their other tenants after August 19.”

The Court reasoned that the moratorium is not a regulatory taking because landlords still retain many economic benefits of ownership such as collecting rent from tenants not facing financial hardship and collecting security deposit funds from tenants affected by the pandemic.

The Court stated that the law is clear that “state governments may, in times of emergency or otherwise, reallocate economic hardships between private parties, including landlords and their tenants, without violating” the US Constitution.

Download a copy of the Court’s opinion.

New York Landlord-Tenant Attorneys

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Emotional Support Chickens

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Emotional support chickens? Really? Read on. 

Under current federal law, all a tenant needs is a letter from a medical professional or counselor that any animal is needed for emotional support, and pretty much the landlord must accept the animal. No choice. No pet fees or deposits. 

Recently in a rental housing industry listserve someone posted about their client whose tenant presented a letter from a doctor indicating the need for emotional support chickens (plural). Now the Housing and Urban Development Department is after the landlord for refusing to allow a chicken coop in the residential rental unit. 

We have no way to verify the story, but there is no incentive for the posting to be fictitious, and the scenario, as crazy as it may sound, is consistent with current federal law on emotional support animals. 

Property Damaged By Tenants – What Should You Do?

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Sadly, it is not unusual for tenants facing eviction to take ‘revenge’ (or to recoup what they see as their losses) by damaging your property or stealing things like appliances. Obviously this is not a situation in which any landlord wishes to find themselves. Tenant-inflicted damage (especially if willful and malicious) can cost thousands of dollars to set right – not only in the actual rep air costs, but in lost rent while the repairs are taking place. Such things can put a struggling landlord into serious financial straits. However, there may be ways in which you can get some of your money back, and there may be ways to turn this nasty situation around. Here are the steps you should take if your property has been damaged by a tenant:

Record Everything

It is more than worth photographing or videoing the property in detail, making meticulous records of all damages. Ideally, you will have photographed the state of the property before the commencement of the tenancy (and will thus be able to compare ‘before’ and ‘after’) – but don’t worry if you haven’t. It is still useful to have a photographic and/or video record of the damage, and will help greatly with any ensuing investigation or court proceedings.

Tell The Police

It’s not often that the police make any actual arrests in the case of tenants damaging properties – but they may still issue you with a police report number, which is very much needed if you’re going to sue your tenants or claim the damage against your insurance. If your tenants have stolen appliances or anything else of yours that is valuable, the police may decide that they have grounds to make an arrest, in which case you can decide whether or not to press charges. Should it transpire that criminal activity has been occurring on the property, and if there is evidence of this, it is more likely that the police will take action against the tenants than if they’ve simply caused damage. Drug dealing or preparation within the property is a common reason for police to arrest former tenants on the landlord’s information – but you need to be able to present evidence of this to the police before they will take any serious action. However, even if the police don’t make any arrests, it’s still helpful from an insurance point of view to have informed them, and potentially to have had them assess the damage.

Contact Your Insurers

Depending on what kind of cover you have for your property, you may well find that your insurers are able to cover much of the cost of repairs. Getting reimbursed for rent lost while repairs are occurring is trickier, but not impossible depending upon your insurer and the status of the case. Your insurer is likely to want to see your photos of the damage, plus any police reports on the case. Most insurers who deal specifically with landlords will be sympathetic to you. However, you may have a battle on your hands in some cases, so it’s wise to be as organized, thorough, and meticulous as you can when presenting your case to the insurers.

Be Sensible With The Security Deposit

Whatever your tenants have done to your property, you still have to abide by the law when it comes to the security deposit your tenant left behind. If you use any or all of the deposit to pay for damages, you must present an itemized receipt to them for having done so. The precise ins and outs of landlord/tenant law varies from state to state, so it’s wise to familiarize yourself with your duties and responsibilities in this area. No matter how angry you are at the state of your property, withholding the security deposit or failing to fulfil your legal obligations will not help matters at all!

Decide Whether Or Not To Sue

On occasion, the best way to get justice and to recoup your losses is to take your former tenants to court. Sometimes, however, the costs of doing this exceed the costs of repairing your property. You may decide that the principle of getting justice is worth the extra costs, or you may decide to cut your losses and work on getting your property back into a reasonable condition. This is entirely up to you. The small claims court, however, is available for situations like this!

Landlord Duty to Deliver Possession

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“English” Rule

The covenant to deliver possession is enforceable against the landlord when a third party wrongfully remains in possession at the time the tenant is entitled to possession. The landlord’s obligation is to ensure actual possession, not a mere right of possession.

This is the long-established rule in England and is followed by a number of American jurisdictions.[1]

“American” Rule

The landlord need only convey the right of possession, not actual possession – unless there is an express lease covenant to the contrary.  This rule was developed historically in US jurisdictions but has been largely modified or abandoned, particularly as to residential tenancies.

Many states have adopted the Uniform Residential Landlord-Tenant Act.[2]  The Uniform Residential Landlord-Tenant Act in its current form has provisions expressly creating a duty to deliver actual possession.

Although statutes in many states are based on this model act, the model and the various statutes in jurisdictions that adopted it evolve separately and differ more and more over time. The Washington Residential Landlord-Tenant Act does not have these provisions.

[1] American Law of Landlord and Tenant, Robert S. Schoshinski.

[2] http://www.uniformlaws.org/shared/docs/residential%20landlord%20and%20tenant/urlta%201974.pdf

 

Advice For New Landlords

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by Eve Pearce

With housing prices remaining relatively low, some are looking to rent out their existing property when moving on rather than selling at a price lower than the purchase while others are using this time of more affordable housing to buy an investment property as a provision for the future. Whatever the reason, becoming a landlord is not risk free and so it is important that you do your research and take the proper precautions to protect your investment and hopefully see a good return.

A Good Rental?

First things first, find out whether your property or prospective property will make a viable rental. This involves calculating total outgoings such as mortgage payments, insurance, maintenance and repairs and agent fees and researching typical rental prices in the same neighbourhood. Speaking to local real estate and letting agents and looking at online property rental websites is essential to finding the right rental price for your property. This is important not only for calculating the yield on your investment to check for financial viability, but also for setting an appropriate price that will attract tenants when you come to advertise. Whether or not a property will make for a good rental is not only about how the figures stack up. It is vital to consider the local market, the competition, and identify the type of tenants that are likely to be interested in your property so that you can make sure you tailor your rental accordingly. For example families will generally require a bath whereas young professionals are often fine with just a shower room. By understanding your market you can ensure that your property caters for the needs of prospective tenants and, in areas of ample competition, stands out from the crowd.

Let Your Mortgage Company Know

If you are thinking about renting a property which you previously purchased with a residential mortgage, it is important that you inform your lender of your intention to let. Some lenders might force you to change your mortgage to a buy-to-let which often requires a lower loan to value and charges a higher interest rate, so be sure find out where your lender stands when you are assessing the suitability of renting out your property.

Work Out Tax Implications

As with any income, money earned from rental of real estate is subject to federal taxation. It is therefore important that you understand the tax implications of becoming a landlord. When you start to receive an income from your property – regardless of whether you make a profit – you will need to declare this income on your tax return. However, there are a number of deductibles (for example repairs to the property) that can offset some of the income you make so it is important that you get into good record keeping habits from the start.

Get Rock Solid Contracts

Regardless of who you are letting your property to, a solid rental contract is vital. Even when you are renting your property to family or friends this is essential, and it is unfortunately often these situations that go wrong and so it is important that you are protected by a sound lease agreement or rental contract. It is worth seeking the advice of a real estate lawyer or attorney to have a contract drawn up to ensure it contains all of the proper provisions. Often new landlords are tempted to find a contract or template online or try drawing up an agreement themselves to save money, but this will be a false economy if your contract turns out not to be watertight if you have problems with your rental.

Vet Your Tenants

Although you will never really know how a prospective tenant will turn out until they are living in your property (or more often until they move out), but it is nonetheless vital to make the appropriate checks into their character and background before you hand over your keys. If you are using a rental agent to obtain tenants and manage your property, they will undertake such checks. However if you are choosing to self-manage, then conducting a credit check and obtaining references from employers and previous landlords is necessary. Another test not to be underestimated is simply meeting prospective tenants face to face. If their checks and references look good but you just have a strange feeling about them, trust your instincts.

Protect Your Property

As a landlord it is important to have the proper insurance in place to protect your real estate and any contents which you own by taking out appropriate landlords insurance. When moving out of and renting your own home, it is important to switch to landlords insurance rather than rely upon your existing policy as in the event of an incident for which you need to make a claim, you could find that your insurer refuses to pay out on the basis that you had leased the property without their knowledge. In addition to covering the property itself and any fixtures and fittings you have provided, it is possible to take out cover against loss of rental income or your liability as a landlord to ensure you are covered in any situation. Another way of protecting your property is by installing adequate smoke alarms and this is in fact a legal requirement in most states.

Know The Law

Another important aspect of becoming a landlord is being aware of all of the laws that protect you as a landlord, such as eviction procedures, and those which you are obliged to adhere to for the protection of your tenants. Understanding your legal requirements as a landlord is crucial to ensuring you don’t find yourself in a litigious situation and understanding your rights as a landlord before you lease your real estate to your first tenants will give you the confidence to act swiftly and appropriately should any difficult situation, such as non-payment of rent, arise.

 

About to get evicted with 5 month old baby…..?

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My and my fiancee are going through a hard time, our car was repossessed, he lost his job, and i have yet to find work since having a baby girl 5 months ago. we are 2 months behind on our rent and just received the eviction papers a week ago. i mailed off a letter to the plaintiff attorney stating the reasons why i think we shouldn’t be forced to move but i have a feeling it doesn’t really matter and that i will be receiving a 24 hr notice any day now. is there any way to slow down the eviction process and buy some time. and any advice to me about where we are supposed to go…we live in broward county florida and i contacted EVERY rental assistance agencies churches and all and no one has funds. even the homeless shelters have waiting lists. what am i supposed to do?? please someone offer me some kind of advice. and no mean answers please. do unto others as you would have them do unto you.

Does anyone know any good landlords that have houses 4 rent?

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Hello My Name is kellyI am in need of a three or four bedroom house within the philadelphia area i really really need to move by august 21,2008 I am willing to pay at least 700.00 in a nice area I already have 1,400 for the security deposit. I f theres any honest landlords or realestates out there please contact me asap. I am a single mother of four wonderful kids. I am working so paying the rent will not be a problem. Iam clean and reliable hardworking and honest. I cannot continue to live in this one bed room apartment it is unfit the owner does not fix anything i have a leaky toliet form the upstairs apartment and my children needs their own rooms. I have one furry friend a small cat who is also clean have all shots and is well cared for. I work and also attend school. I am not on section eight i have been on the waiting list for 11 years and have not been called. My credit is not to good but that doesnt mean that i will not be a good tenant. I have no evictions.