MANHATTAN (CN) — An appellate panel tossed out a group of New York landlords’ lawsuit challenging the state’s Covid-19 eviction moratorium — a case that had temporarily blocked the statewide ban after the Supreme Court weighed in on its constitutional merits.
New York state legislators tweaked the eviction stay after the Supreme Court ruling, which took issue with a provision that let tenants declare a financial hardship to avoid being evicted without having to offer proof to their landlord.
The adjustment was enough to render the plaintiff landlords’ due process claims as moot, a Second Circuit panel ruled on Wednesday.
“In this case, we cannot be certain how the new procedures in [the eviction ban] will be implemented in practice in the state courts or what administrative steps the Chief Administrative Judge of those courts might think are necessary, if any, to mitigate the alleged due process deficiencies in those procedures,” reads the 19-page order, penned by Senior U.S. Circuit Judge Jon O. Newman, a Jimmy Carter appointee.
“But we do not think we should undertake to rule on those matters definitively on this appeal, which is nominally a challenge to the expired provisions of the old statute but is realistically an attempt to challenge the new statute.”
Since the appellate panel remanded the matter to district court, it lacks jurisdiction to grant the landlords an injunction, the judges wrote. They vacated the district court’s ruling with leave for the landlords to assert new claims, challenging the new statute.
“A hearing in a District Court proceeding will provide an opportunity to clarify how the new statute will be implemented, thereby creating the basis for an informed appellate ruling as to a due process claim in the event of a subsequent appeal,” the judges wrote.
In addition to Newman, the Second Circuit panel included the Clinton-appointed U.S. Circuit Court Judge José A. Cabranes and Senior U.S. Circuit Judge Richard C. Wesley, appointed by George W. Bush.
Filed in the Eastern District of New York, the 49-page complaint argued that New York’s ban on evictions was keeping the plaintiffs out of their own homes.
One of the landlords filing suit, a single mother and Air Force veteran, broke into tears during oral arguments as she explained that a family living in one of her six residences had stopped paying rent — leaving the landlord no choice but to keep living with her ex-fiancée.
“He’s been asking me to leave for a couple months,” said Brandi LaCasse, her voice breaking up with emotion. Her ex sent “nasty text messages,” telling her to get out, she added.
But the testimony from LaCasse and others was unsuccessful in pushing U.S. District Judge Gary Brown to strike down the eviction ban.
Instead, he consolidated the landlords’ motion for a preliminary injunction with the merits of the case, and ruled in favor of defendant Chief Administrative Judge Lawrence Marks, dismissing all other defendants — which included county sheriffs and other court officials — from the case.
The landlords, represented by attorneys from the firm Gibson Dunn, then took their fight to the Supreme Court in August, where judges took issue with the provision of the law that allowed tenants to file an uncontested hardship declaration.
"If a tenant self-certifies financial hardship, Part A of CEEFPA generally precludes a landlord from contesting that certification and denies the landlord a hearing," the unsigned order states. "This scheme violates the court’s longstanding teaching that ordinarily 'no man can be a judge in his own case' consistent with the Due Process Clause."
Following public promises to reinstate the ban, New York legislators passed a bill extending it until January 2022, which added a due process mechanism for landlords to challenge financial hardship declarations submitted by residential and commercial tenants in court.
In their Second Circuit brief, the landlords continued to argue that the government was requiring “private property owners to convey government messages directly contrary to their interests: It forces them to supply a government-drafted notice and declaration form instructing tenants how to forestall eviction and evade paying rent, as well as a government-curated list of legal service providers who are available to assist tenants in doing so.”
The plaintiffs also said that district court erred by ignoring the Roman Catholic Diocese of Brooklyn Supreme Court ruling, which found that “even in a pandemic, the Constitution cannot be put away and forgotten.”
In response, the state said that the Supreme Court’s stay of ban lacked the benefit of “more recent data confirming that resuming evictions en masse would cause significant harms given the new threats posed by the ever-changing COVID-19 pandemic,” and that those harms are unnecessary while the state continues distributing $2.4 billion in rental assistance benefits to landlords like the plaintiffs.
Eric Dunn, director of litigation at the National Housing Law Project, said the Supreme Court’s ruling could have an effect on hundreds, if not thousands, of similar legal schemes that allow people to sign a declaration placing themselves in a certain category.
“I thought the Supreme Court’s decision, striking down the original moratorium, was quite questionable,” Dunn told Courthouse News in a phone interview. “That could call a lot of different legal schemes into question.”
While New York’s ban stands for now, the federal eviction moratorium was blocked by the Supreme Court at the end of August.
“It was kind of a bad day for tenants, but not unexpected,” Dunn said of the national ban’s end.
The ban, while a good idea, wasn’t necessarily doing its job, either.
“A lot of people really didn’t appreciate it being called a moratorium, because there were just so many workarounds,” Dunn said.
That included judges choosing not to honor the bans in some cases, Dunn said. So for eviction defense lawyers trying to figure out how to help tenants, “you have no idea whether the judge who’s on the bench that day is going to actually enforce it.”
Federal rental assistance money is still being distributed — slowly, Dunn said: “The pace of the payments has been picking up, but most of the money’s still there.”
Some states have implemented stopgap measures to help those who have applied for aid. In Virginia, Dunn said, applicants can get an eviction stay for 30 or 45 days while the payment is processed, for example.
Those measures may have helped to avoid a major spike in evictions that housing advocates had feared. Dunn said an uptick, though, could be more incremental.
“When we look back over time, we’ll see that there were more of them,” he said. But, unlike the potential for hundreds of thousands of people to be displaced over a few weeks, “it’s not going to necessarily be visible to the naked eye.”
The landlords’ attorney, Randy Mastro, did not respond to a call and email on Wednesday requesting comment. New York’s chief administrative judge’s office could not be reached in time for publication, nor could the Rent Stabilization Association of New York City.
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