Trump Administration, CDC Sued By Landlords Over 'Unconstitutional' Moratorium On Evictions

A national moratorium on evictions is being challenged in at least two lawsuits filed in federal court on the grounds that denying landlords the right to evict tenants for nonpayment is unconstitutional.

The National Apartment Association - a trade group representing the apartment rental housing industry, joined a lawsuit filed in a Georgia federal district court against the Trump administration and the Centers for Disease Control. The original suit was brought by a group of landlords and the New Civil Liberties Alliance - a nonprofit group which seeks to protect constitutional freedoms and civil rights "from violations by the Administrative State," according to MarketWatch.

"Agencies have no inherent power to make law, and nothing in the relevant statutes or regulations gives CDC the power or authority to issue an eviction-moratorium order," said the New Civil Liberties Alliance in a summary of the court filing which claims that the CDC's moratorium "violates the U.S. Constitution because the CDC has not identified any act of Congress that confers upon it the power to halt evictions or preempt state landlord-tenant law."

The group claims the CDC moratorium basically "commandeers" state officials - including law enforcement officers and judges, to enforce federal law.

As Zachary Yost of the The Mises Institute noted last month, the war on landlords has begun.

A second lawsuit was filed by a group of Tennessee property owners, who similarly argue that the CDC's moratorium violates the constitution - and that the agency has prevented landlords from exercising due process over their property rights.

"Plaintiffs readily acknowledge the nobility of the CDC’s and, by extension, the executive branch’s, desire to help those profoundly affected by the current health crisis," states the suit. "However, that help must conform to the law and must not infringe unlawfully upon the rights of others."

Rental-housing industry officials have warned that the CDC’s order could have devastating effects on landlords, particularly smaller “mom-and-pop” landlords who own only a handful of properties.

The CDC eviction moratorium will surely cause more economic harm than it prevents,” said David Howard, executive director of the National Rental Home Council, another industry trade group. “It puts renters in a position of having to pay back rent that they likely won’t have, while causing immediate hardship for property owners who have no means of carrying the costs of ownership.”

 

Now that the moratorium is in effect, Howard said, many property owners have come to the conclusion that they may not be able to afford to stay in business. (The National Rental Home Council is not party to either of the lawsuits against the CDC.) -MarketWatch

Another group questioning the legality of the moratorium - the National Multifamily Housing Council - has not joined either of the lawsuits, but has instead pursued rental assistance for struggling tenants.

"It is far better to focus on ensuring renters can pay the rent than to try and come up with policies like eviction moratoriums that do not address the root cause and put housing providers at financial risk," said Paula Cino, the group's VP of construction, development and land use policy.

Affordable housing experts agree with Cino.

"Rather than suing for the right to evict during a pandemic, landlords should be working with renters to ensure Congress provides at least $100 billion in emergency rental assistance to help renters avoid a financial cliff when the moratorium expires and to help landlords continue to operate their rental homes," said Diane Yentel, president and CEO of the National Low Income Housing Coalition.

Said experts also say that the two lawsuits against the CDC are unlikely to be successful - as landlords who have previously challenged state moratoria on evictions using similar arguments.

"Every single case filed previously was dismissed for lack of merit, and we think the same thing should happen with these new cases," said Eric Dunn, director of litigation at the National Housing Law Project.

And while the CDC has issued its moratorium, evictions are still making their way through state and local courts nationwide. The CDC’s order doesn’t automatically protect tenants from being kicked out of their homes for failure to pay the rent amid the coronavirus pandemic. Instead, renters must proactively sign a document stipulating that they cannot pay and provide that document to their landlord. Legal experts have also suggested that loopholes in the order could allow for evictions to occur.

As of Monday, roughly 3,500 eviction cases had been filed by private-equity firms and other corporate landlords, according to information collected by the Private Equity Stakeholder Project, an initiative that seeks to monitor these firms. In the last week alone, more than 1,860 cases had been filed. -MarketWatch

"Corporate landlords are moving quickly to file evictions before renters can make use of the protections," said Yentel. "As the CDC order makes clear, eviction poses significant harm to individuals, their communities, and our broader public health as we collectively work to contain the coronavirus pandemic and prevent unnecessary deaths."