Landlords Suffer Setback in Bid to End Eviction Moratorium

by | Nov 23, 2020 | Eviction Strategies

A federal judge has refused to grant an injunction to a group of landlords who say that the federal government’s temporary eviction freeze violates their constitutional rights and is causing irreparable harm.

In a 66-page decision that traverses the intricacies of numerous Latin legal terms and relies in part on a case involving turtle farming, the federal district court in Atlanta determined that the CDC has the authority to regulate state landlord-tenant laws if the agency determines such a move benefits public health. The court also held that the damage landlords suffer in subsidizing renters while the pandemic takes it course is not irreparable.

Lawyers for the New Civil Liberties Alliance which brought the suit on behalf of landlords in several states who are impacted by the federal eviction ban called the decision “erroneous” and already have asked the U.S. Court of Appeals to stay the decision pending their appeal.

The federal eviction moratorium came after landlords endured months of state-ordered eviction bans and as Congress debated an additional stimulus that would have extended unemployment benefits and offered additional relief to those struggling during the pandemic. However, when lawmakers failed to reach a deal on a stimulus package, the Administration ordered the CDC to demand the eviction moratorium on the grounds that evicted tenants would be at greater risk for contracting COVID-19.

The result of the government’s action has been to shift the financial burden from unemployed tenants to their landlords, many of whom rely on monthly rent payments as their source of income.

Lawyers argued that the order to halt evictions was not based on substantial evidence that it would be successful in stopping the spread of disease, nor would it be necessary. For instance, the CDC is not ordering other businesses, like bar and restaurant owners, to forgo their income to stop the spread of COVID. Without considering the extraordinary financial burden the eviction ban places on landlords, the court determined that the eviction ban does not need to be the best option, but merely an option for stopping the spread of the virus.

The judge determined that it is unlikely the landlords will prevail on their constitutional claims when the matter goes to trial, and therefore, they are not entitled to an injunction blocking the moratorium from taking effect. In reaching this conclusion, the court determined that the moratorium does not prevent landlords from pursuing their right to a court-ordered eviction, only in enforcing it prior to the January deadline. In practice, that distinction is hazy, and may require landlords to seek multiple court hearings and incur added expense. It also puts landlords in the unenviable position of having an angry tenant with nothing to lose in possession of the rental property asset for several more weeks.

Referring to provisions in the eviction order that require tenants to pay past due rent in full in January, the court dismissed the landlords’ argument that they will never collect months of outstanding rent from insolvent tenants, stating that the landlords “have not shown that they will likely never be able to collect a judgment.”

This post is provided by Tenant Verification Service, Inc., helping landlords reduce the risks of renting with fraud prevention tools that include Tenant Screening, Tenant Background Checks, (U.S. and Canada), as well as Criminal Background Checks, and Eviction Reports (U.S. only).

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Disclaimer: The information provided in this post is not intended to be construed as legal advice, nor should it be considered a substitute for obtaining individual legal counsel or consulting your local, state, federal or provincial tenancy laws.

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