Here's the latest complaint challenging coronavirus-related orders (in this case, the City of Los Angeles' rent payment and eviction moratoria) as a taking.
More here from the LA Times: "Landlord group sues city of L.A. over coronavirus anti-eviction protections."
You should probably read the entire document, as it is drafted well. But it is long (48 pages - it even has a Table of Contents and a Table of Authorities), so here are the key parts of the Introduction in case you don't have time to digest the whole complaint:
1. In the wake of the novel coronavirus, Defendants City of Los Angeles, City Council of the City of Los Angeles, and Mayor Eric Garcetti (collectively “City” or “Defendants”) hastily instituted a series of ordinances which prohibit lessors and landlords, such as Plaintiff’s members, from exercising their contractual remedies where tenants refuse to pay rent on the asserted grounds that they were impacted by the COVID-19 pandemic (“Pandemic”). While purportedly intended to provide relief to tenants so impacted, the ordinances are not tailored to a tenant’s actual inability to pay rent and significantly (and needlessly) infringe on the constitutional rights of all lessors and landlords within the City.
2. This Action challenges the implementation of the City’s Eviction Moratorium (Ordinance No. 186585) and Rent Freeze Ordinance (Ordinance No. 186607) (collectively the “Ordinances”) adopted by the City Council on March 27, 2020 and March 30, 2020, respectively.
3. Plaintiff’s members are sympathetic to tenants who have actually suffered hardship due to the Pandemic. Plaintiff’s members have every incentive to work with those tenants who do not have the financial means to pay all or some portion of their rent. As set forth below, however, the Ordinances actively undermine any such attempts at cooperation and allow tenants who actually have the ability to pay all or some of their rent to ignore their contractual obligations for the foreseeable future.
4. The Eviction Moratorium, among other things, contains provisions that indefinitely prohibit landlords and property owners from initiating or continuing residential eviction proceedings based upon non-payment of rent. Although it ostensibly only applies if a tenant is unable to pay due to circumstances related to the Pandemic, it does not require tenants to provide notice, let alone documentation, of their inability to pay. While the Eviction Moratorium provides no relief for owners and landlords and requires them to continue meeting their contractual and statutory obligations as “lessors,” it completely abrogates the material obligations of lessees and eliminates all of the contractual remedies lessors ordinarily have when tenants breach their lease provisions. Lessors are forbidden not only from commencing eviction proceedings for failure to pay rent, but from charging any late fees or interest to which they are contractually entitled. Under the Eviction Moratorium, tenants may continue to occupy their respective premises at no charge, utilizing the water, power, trash, sewage, and other fees that the landlords must continue to pay without reimbursement. By stripping all remedies away from owners – without requiring tenants to demonstrate an inability to pay rent – the Eviction Moratorium discourages tenants who can pay all or some of what they owe from doing so.
5. The Eviction Moratorium also gives tenants a full twelve months following expiration of the “Local Emergency Period”—which seems likely to last many months, at a minimum—to repay back rent, irrespective of the tenant’s ability to pay some or all rent, the term of the lease, any agreed plan or schedule for repayment, or any evidence demonstrating that the tenant will actually be capable of paying back rent at the expiration of the one-year grace period. For many, if not most “qualifying” tenants, the “rent deferral” provision will operate as rent forgiveness, as it is unlikely that tenants who do not pay rent during the Local Emergency Period will be in a position to pay back rent, in addition to their normal rent, at the conclusion of the grace period (whenever that may be). The Eviction Moratorium also fails to address how a landlord or property owner would actually be able to collect rent from those tenants who take advantage of the Eviction Moratorium, but move to a different location by the end of the one-year grace period. Indeed, the City has banned owners from pursuing their primary remedy (eviction) needed to mitigate damages where the tenant fails to pay rent. Every month a landlord is prevented from renting its unit to a paying tenant is a month for which the landlord cannot mitigate any damages. The Eviction Moratorium would force owners to allow tenants who have stopped paying – and may never pay again – to continue to occupy their units for many months and likely well into 2021. While owners can theoretically eventually sue such tenants for back rent (but not for any interest or late fees), their likelihood of ever actually collecting on a judgment for many months of back rent is minimal, at best. As for those tenants who move prior to the time owners may sue to recover back rent, there is simply no chance to recover such rent and, even if there was, the owner would incur a tremendous (and likely unrecoverable) litigation expense just to get that to which the owner is entitled.
6. The Eviction Moratorium further prohibits all evictions based on the presence of unauthorized occupants or pets, as well as for undefined “nuisance[s] related to COVID-19.” Incredibly, the Eviction Moratorium creates a private right of action in favor of only tenants whereby tenants are allowed to sue for alleged violations of the moratorium, subjecting landlords to civil penalties of up to $15,000 per violation. Thus, while the Eviction Moratorium bars lessors and landlords, like Plaintiff’s members, from utilizing their primary contractual remedy to secure payment of rent, it provides a new weapon for tenants to use against landlords and lessors who seek only that to which they are entitled under their existing leases.
7. The Rent Freeze Ordinance prohibits property owners from raising rent on any property subject to the City’s Rent Stabilization Ordinance for a period of one year following the end of the “Local Emergency” as declared by the Mayor, thus preventing property owners from implementing even the modest increases ordinarily allowed on properties pursuant to their respective lease agreements. The Rent Freeze Ordinance was adopted without any mechanism to determine whether rent increases are necessary for landlords to obtain a fair return, as required under the U.S. and California Constitutions. The impact of the two Ordinances together is thus particularly devastating, as property owners are not only forced to forbear collecting rent and effectively give interest-free loans to tenants who assert any Pandemicrelated inability to pay, but are also prohibited from making normal rent adjustments with respect to tenants that do not claim any financial hardship. The Ordinances also require property owners to financially support their tenants during the Local Emergency by subsidizing tenants’ rent, utilities and other charges without any support to the property owner or landlord. The City notably has refused to provide any financial relief to landlords and property owners, despite the hardship they have and are suffering.
8. As set forth below, this action seeks to nullify the Ordinances as violative of the United States and California Constitutions, on the grounds that they improperly interfere with Plaintiff’s members’ contracts and due process rights and constitute an improper uncompensated taking of the fundamental property rights of Plaintiff’s members. The Ordinances are further preempted by California law and the unlawful detainer statutes, which are intended to fully occupy the field of eviction procedures.
This joins a growing list of similar claims (see here, here, here, here, here, here, here, here, here, here and here, for example).
We'll be speaking about this question (and other related topics later this week in a program for the King Kamehameha V Judiciary History Center (open to the public, register here). Our thoughts on the takings aspects of the shutdowns orders generally: "Evaluating Emergency Takings: Flattening The Economic Curve."
Complaint for Declaratory Injunctive Relief, Apartment Ass'n of Los Angeles County, Inc. v. City of Los Angeles, No. 2:20-cv-05193 (C.D. Cal. June 11, 2020)
