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September 07, 2021 Articles

SCOTUS: CDC’s Eviction Moratorium Is Unlawful

Landlords must continue to abide by the requirements of the local laws imposing eviction moratoria.

By Ali Degan

On August 26, 2021, the Supreme Court, per curiam, once again affirmed the ruling of the U.S. District Court for the District of Columbia, concluding that the landlords are virtually certain to succeed on the merits of their argument that the Centers for Disease Control and Prevention (CDC) has exceeded its authority in imposing the eviction moratorium. However, this time, both the district court and Supreme Court agreed to vacate the stay, which they had previously refused to do, rendering it enforceable. Alabama Association of Realtors, et al. v. Department of Health and Human Services, et al., 594 U. S. ____ (2021).

The Court noted that in March 2020, Congress imposed a 120-day national eviction moratorium on certain properties with federally backed mortgages by enacting Coronavirus Aid, Relief, and Economic Security Act (the CARES Act). If Congress meant to extend its moratorium, it should have done so instead of CDC inappropriately taking the role of Congress, the Court reasoned. Accordingly, the CDC went beyond its statutory authority when it administratively, yet unlawfully, imposed its eviction moratorium.

The CDC relied on section 361(a) of the Public Health Service Act for authority to promulgate and extend the eviction moratorium. See 58 Stat. 703, as amended, 42 U. S. C. §264(a). Referring to how old the statute is (it passed in 1944), the Court noted that the provision on which the CDC relied, has never been used before to justify an eviction moratorium. Rather, regulations under this authority have generally been limited to quarantining infected individuals and prohibiting the import or sale of animals known to transmit disease. See, e.g., 40 Fed. Reg. 22543 (1975) (banning small turtles known to be carriers of salmonella).  

In its judgment, the district court stated that it vacated the stay for two reasons. “First, the Government was unlikely to succeed on the merits, given the four votes to vacate the stay in the Supreme Court and Justice Kavanaugh’s concurring opinion. 2021 WL 3577367, *6 (Aug. 13, 2021). Second, the equities had shifted in the plaintiffs’ favor: Vaccine and rental-assistance distribution had improved since the stay was entered, while the harm to landlords had continued to increase. But the court concluded that its hands were tied by the law of the case, in light of the D. C. Circuit’s earlier decision not to vacate the stay.” Another attempt to vacate the stay at the D. C. Circuit Court was unsuccessful on August 20, 2021. Therefore, applicants turned to the Supreme Court for relief.

Irrespective of the statutory language and interpretation, the per curiam decision stated that the Court expects Congress to speak clearly when authorizing an agency to exercise powers of “vast ‘economic and political significance.’” Utility Air Regulatory Group v. EPA, 573 U. S. 302, 324 (2014), quoting FDA v. Brown & Williamson Tobacco Corp., 529 U. S. 120, 160 (2000). Aside from that, the CDC moratorium intrudes into an area that is the particular domain of state law: the landlord-tenant relationship. See Lindsey v. Normet, 405 U. S. 56, 68–69 (1972).

The Court also agreed with the district court that equities do not justify depriving the applicants of the judgment in their favor by stating that “the moratorium has put the applicants, along with millions of landlords across the country, at risk of irreparable harm by depriving them of rent payments with no guarantee of eventual recovery”. Alabama Association of Realtors, 594 U.S. at ___ (slip op., at 2). “It is indisputable that the public has a strong interest in combating the spread of the COVID–19 Delta variant. But our system does not permit agencies to act unlawfully even in pursuit of desirable ends[,]” the per curiam decision reasoned.  Cf. Youngstown Sheet & Tube Co. v. Sawyer, 343 U. S. 579, 582, 585–586 (1952) (concluding that even the Government’s belief that its action “was necessary to avert a national catastrophe” could not overcome a lack of congressional authorization). The Court noted, in closing, that “it is up to Congress, not the CDC, to decide whether the public interest merits further action here.”

Justice Breyer’s dissent, which was joined by Justice Sotomayor and Justice Kagan, stated that the Court erred in vacating the stay without full briefing and as an emergency matter. More specifically, the Supreme Court “may not vacate a stay entered by a [lower] court . . . unless that court clearly and ‘demonstrably’ erred in its application of ‘accepted standards.’” Planned Parenthood of Greater Tex. Surgical Health Servs. v. Abbott, 571 U. S. 1061 (2013) (Scalia, J., concurring in denial of application to vacate stay), quoting Western Airlines, Inc. v. Teamsters, 480 U. S. 1301, 1305 (1987) (O’Connor, J., in chambers). Those accepted factors are “(1) whether the stay applicant has made a strong showing that he is likely to succeed on the merits; (2) whether the applicant will be irreparably injured absent a stay; (3) whether issuance of the stay will substantially injure the other parties interested in the proceeding; and (4) where the public interest lies.” Nken v. Holder, 556 U. S. 418, 426 (2009) (internal quotation marks omitted).

In Justice Breyer’s view, the courts below did not clearly err for three reasons. Irrespective of the statutory interpretation, “first, it is far from ‘demonstrably’ clear that the CDC lacks the power to issue its modified moratorium order as there is a split among the Circuits. Furthermore, CDC’s current order is substantially more tailored than its prior eviction moratorium, which automatically applied nationwide. Justified by the Delta-variant surge, the modified order targets only those regions currently experiencing skyrocketing rates.”

Citing Chrysafis, which struck down a portion of New York’s moratorium, see Chrysafis v. Marks, post, at 1, Justice Breyer stated that, under the CDC’s moratorium, landlords remain free to “challeng[e]” in court “the truthfulness of a tenant’s . . . declaration” that he or she qualifies for the order’s protection. Furthermore, the dissent reasoned that Congress’ short extension of the CDC moratorium in 2020 was a tacit approval of the authority granted to the CDC by virtue of the cited statute. Second, the balance of equities strongly favored leaving the stay in place as the landlords’ loss of income was partially compensated by the CDC order’s directive that tenants have an obligation to make “as close to the full rent payment” as possible. To compensate for the shortfall, Congress appropriated more than $46.5 billion to help pay rent and rental arrears. The delay to get compensated is the injury, but the dissent emphasized that one must compare that injury to the irreparable harm from vacating the stay. “COVID–19 transmission rates have spiked in recent weeks, reaching levels that the CDC puts as high as last winter: 150,000 new cases per day.” “Absent the stay, the CDC projected a strong ‘likelihood of mass evictions nationwide’ with public-health consequences that would be ‘difficult to reverse’”, wrote Justice Breyer. Third, the public interest strongly favors respecting the CDC’s judgment at this moment, when over 90 percent of covered counties are experiencing high transmission rates. Given that its decision will impact the health of millions, the Court should have fully heard the matter before vacating the stay.

The Court’s ruling, nevertheless, will allow evictions to proceed nationwide, where the state law has not imposed a local moratorium. Landlords must continue to abide by the requirements of the local laws imposing eviction moratoria. Practitioners should keep abreast of the ever-changing scope of pandemic-related eviction laws.

Ali Degan is an associate with Stern & Eisenberg, P.C., in New York City, New York.

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