LA Moratorium Battle Joins Dozens Across The Country

A suite of protections the city of Los Angeles put in place to keep tenants in their homes during the coronavirus pandemic hangs in the balance after a new legal challenge from a Southern California apartment owners association. It now joins dozens of both state and local eviction protections that are the subject of court battles across the country.

On March 31, 2020, the city of Los Angeles implemented anti-eviction protections for tenants affected by the coronavirus. The protections prohibited landlords from evicting renters who couldn’t pay rent due to COVID-19, or for "no fault" reasons or unauthorized occupants, like a pet or another person staying in the unit as a result of fallout from the pandemic. The city also enacted a rent freeze on rental units that fall under the city’s rent-control ordinance. 

“This is a common sense action to help tenants stay in their homes,” said Mayor Eric Garcetti, announcing the rent freeze. “Angelenos who have lost hours or been laid off, or can’t work as a result of a COVID-19 diagnosis, should not face the extra burden of a spike in their rent.”

Landlords and landlord groups saw the new rules as anything but common sense. Just over a month later, the Apartment Association of Greater Los Angeles filed a lawsuit against the city in the U.S. District Court for the Southern District of California, seeking to invalidate the city’s COVID-19 renter protections and the rent freeze. 

Then, in late September, not wanting to wait for the trial to play out, AAGLA filed a preliminary injunction, which, if granted, would end the city’s protections immediately. 

“Our concern is that, following seven months of not collecting rent under the city of Los Angeles’ emergency ordinances, many rental property owners and our members have been suffering the severe financial consequences of the city’s eviction ban and rent increase freeze,” AAGLA Executive Director Daniel Yukelson told Bisnow.

A spokesperson for the Los Angeles City Attorney said the city vigorously opposes the motion for the injunction but didn't offer further comment.

Also involved in the case are the nonprofits Strategic Actions for a Just Economy and Alliance of Californians for Community Empowerment. They joined the case in July as intervenors on the side of the city, for tenants to have a voice in a case that could profoundly affect them.

“If AAGLA’s injunction is granted, the city’s eviction protections and rent freeze would be immediately halted,” said Faizah Malik, an attorney with Public Counsel who is representing the nonprofits Strategic Actions for a Just Economy and Alliance of Californians for Community Empowerment. “This would put tenants who have been relying on these protections at risk of eviction."

Malik said invalidating the city’s protections would mean that some tenants could be evicted for nonpayment as early as February because the 12-month repayment period for back rent that the city’s ordinance provides them would disappear. 

Malik also said that tenants could immediately face no-fault evictions and evictions for unauthorized occupants or pets who are in the unit because of COVID-19, or a family member who moved in with another because they lost their job, for example. 

“We are vigorously opposing the injunction because we are still in the midst of the emergency and tenants still need all of these protections,” Malik said.

Across the country and within the state, landlord response to eviction moratoriums at the local, state and federal level has been wide-ranging. 

In San Francisco, a coalition of landlord groups sued San Francisco in San Francisco Superior Court over its eviction moratorium, which they said would allow renters to live rent-free for months and offer no legal pathways for landlords to get back rent, KQED reported. Those groups lost in court, but appealed the decision in August, according to the website for the San Francisco Apartment Association, one of the groups involved in the legal action. 

“Property owners would have no legal recourse to recoup unpaid rent. Small owners are particularly hard hit by renters who cannot pay,” a representative for the Small Property Owners of San Francisco Institute told KQED in a statement.

Nationally, a number of groups have filed legal challenges to an eviction moratorium from the U.S. Centers for Disease Control and Prevention. In September, the 85,000-member National Apartment Association joined a lawsuit filed by the New Civil Liberties Alliance against the CDC, claiming that the CDC’s order overrides state laws that empower landlords to retake their property from tenants who don’t pay rent. 

“Because the CDC has not identified any act of Congress that confers upon it the power to halt evictions or preempt state landlord-tenant laws, the order violates the U.S. Constitution and should be declared void by the Court,” the NCLA said in a statement. 

AAGLA’s lawsuit challenges the constitutionality of the city’s eviction protections and rent freeze, arguing in its lawsuit that the city’s eviction safeguards were a violation of their constitutional rights because they changed the nature of the landlord-tenant agreement. 

“At the heart of any rental lease is the tenant’s agreement to pay rent — typically on a monthly basis, with rent paid in advance for the coming month — in exchange for the right to occupy housing,” AAGLA wrote in the injunction.

By forcing landlords to provide housing even when tenants aren’t holding up their end of the bargain, AAGLA argued that the city had fundamentally changed the landlord-tenant relationship and violated their constitutional rights in doing so. 

Attorneys for SAJE and ACCE say that the standard to get an injunction is high. The attorney for AAGLA did not respond to Bisnow by press time. 

“The standard to get an injunction is quite high and AAGLA is going to have to show that they’re likely to succeed on the merits, suffer irreparable harm, that the balance of equities tips in their favor, and that the injunction is in the public interest,” Malik said.

If the city’s eviction ordinance is voided, it’s likely that city residents would still be protected from certain types of eviction by a newly passed state law, AB 3088, said Jonathan Jager, an attorney with the Legal Aid Foundation in LA who is tracking the various new rules around evictions that have cropped up as a response to the coronavirus.

The new state regulation would require many actions and payments that the city protections did not, including the mandate that tenants affected by COVID-19 pay 25% of the rent owed from September 2020 through January 2021 in order to be permanently protected from eviction for nonpayment. It’s also possible that existing county protections could come into play. 

“These [eviction rules and regulations] are incredibly complex and an injunction would make them more complex,” Jager said. 

The way that the patchwork of city and state regulations has impacted landlords seems to vary. Cityview CEO Sean Burton told Bisnow that the LA-based multifamily investor and developer hadn’t really been affected by the eviction moratorium. 

“We’ve been pleasantly surprised with the strength of our rent collections throughout the pandemic, and have not seen the high delinquencies that some anticipated,” Burton said.

Depending on asset class, rent collection has been in the low to high 90% range at the LA-based multifamily investor and developer’s properties, Burton said, and the company has been able to negotiate agreements with those tenants who have had trouble paying their rent. 

But for Malcolm Bennett, a landlord whose properties are largely in South Central LA, the situation is more dire. Bennett said many of the tenants in his properties, many of whom work in industries that were affected by the shutdown or cannot be done remotely, were hit hard by the pandemic. 

“This is worse than the 2008 recession. Then, people still had jobs and money and were still paying rent,” Bennett said. 

Bennett is a member of NAA, which is suing the CDC, and he supports the lawsuit they filed. Bennett is also a member of AAGLA. He said the best outcome he could imagine would be for the federal government to issue rent vouchers to tenants who can’t pay rent that would allow money to flow to property owners so they could pay their bills and maintain their properties.

“If you’re unemployed and don’t have any money, you can’t go into the grocery store and get a bag of groceries and say, ’Well, I’ll pay for it when the pandemic is over,’” Bennett said. “Why are we the only ones that have to bear the brunt of this?”