On October 8th, 2024, the Virginia Court of Appeals issued a ruling that comes as a win for many housing providers in Virginia. In Woodrock River Walk v. Rice and Andrade, the Court ruled that the CARES Act is violated only when an officer executes a writ of execution during the 30 days after a housing provider has served a notice to vacate.
Background
Woodrock River Walk, LLC (Woodrock) issued a notice to Lloyd Rice and Christine Andrade (the Residents) for failure to pay rent on December 7, 2022. The notice stated that under Virginia law, the lease would terminate if the rent was not paid within five days, and Woodrock could proceed to regain possession. The notice also informed the Residents that they were not required to vacate the premises for 30 days, per the CARES Act. On January 5, 2023, Woodrock filed a summons for unlawful detainer, also known as an eviction, in the City of Salem General District Court (GDC).
The GDC dismissed the unlawful detainer, and Woodrock appealed to the Salem Circuit Court. The Residents filed a motion to dismiss the lawsuit, arguing the summons issued by Woodrock violated the CARES Act because a housing provider cannot require a resident to leave their property until 30 days after a resident receives notice, and here the summons for unlawful detainer was issued 29 days after the Residents received notice. The Circuit Court agreed with the Residents and dismissed the case. Woodrock then appealed to the Court of Appeals.
Virginia Court of Appeals Makes its Mark on the CARES Act
Focusing on statutory interpretation, the Court analyzed whether filing a summons for unlawful detainer or terminating a lease required a resident to vacate, thus violating the CARES Act if done during the 30 days following the issuance of a notice to vacate. The Court determined that the plain language of the CARES Act does not prohibit a housing provider from filing an eviction action within the 30-day period, stating a “summons for unlawful detainer is merely the initial filing that begins the eviction process” and does not require the resident to vacate the premises. The Court also took note of Virginia’s eviction process, stating “…there are many steps after a court issues a summons before a landlord can compel the tenant to vacate” and only the execution of a writ of eviction compels a resident to vacate the premises.
Under this analysis, the Court held that Woodrock’s summons for unlawful detainer, filed 29 days after issuing the five-day notice to pay or quit, did not violate the CARES Act because it did not require the Residents to leave the premises.
The CARES Act versus Virginia Code § 55.1-1233
The Court then analyzed whether the five-day notice to pay or quit that Woodrock issued to the Residents terminating the lease violated the CARES Act. The Residents argued that Woodrock was in violation of the CARES Act because “[t]he lease is the instrument that gives [the Residents] the right to remain in the dwelling unit, [and] if the lease terminated, [ then] they have no right to remain in the unit.” The Court interpreted the five-day notice as a notice to vacate under the CARES Act because it “terminated the Residents’ lease after five days for failure to pay, and the termination of the lease mandated [that the Residents] vacate.”
Virginia Code § 55.1-1233 states, “At the termination of the term of tenancy, whether by expiration of the rental agreement or by reason of default by the tenant, the tenant shall promptly vacate the premises…” [emphasis added]. The Court determined this language conflicted with the CARES Act 30-day notice to vacate because it is legally impossible for a housing provider to follow Virginia state law and the CARES Act. Therefore, the Court held that the federal CARES Act notice to vacate preempted Virginia’s state law, granting residents 30 days to remain on the premises despite lease termination. However, the Court was clear that this does not mean a housing provider may not terminate a lease during the 30-day window; rather, after a housing provider terminates a lease, a resident has 30 days before they need to leave the premises after receiving a notice to pay or quit.
The Court states that its interpretation “adheres to the purpose of the CARES Act—to provide protection to [residents] by allowing them to remain in their premises for additional time despite receiving a notice to vacate.”
Conclusion
The Court held that Woodrock’s notice to the Residents was lawful because it adhered to Virginia law and the CARES Act.
The Court concluded its opinion by stating that in Virginia, neither a summons for unlawful detainer nor a notice of termination of a lease requires a resident to vacate the premise; therefore, the CARES Act notice requirement is violated only when an officer executes a writ of execution during the 30 days after a housing provider has served a notice to vacate. The Court reversed the circuit court’s ruling and sent the case back to the lower court for further proceedings.
Impact on the Industry
Since its implementation in March 2020, the CARES Act's federal 30-day notice to vacate requirement has created significant confusion for housing providers managing federally backed and federally assisted properties. The enforcement of this notice requirement remains a contentious issue in courts nationwide, leaving housing providers uncertain about the correct notice obligations for covered properties. The CARES Act's notice to vacate—which overrides state and local notice periods— was a temporary measure that expired after the 120-day moratorium expired in 2020.
The National Apartment Association (NAA) is aware that at least six states have upheld the CARES Act through case law. However, this recent case offers clarity for housing providers in Virginia by confirming that housing providers can file a summons for unlawful detainer within the 30-day notice period mandated by the CARES Act without violating its provisions. Unfortunately, this case is only binding in Virginia, though it can serve as persuasive case law in other jurisdictions.
NAA’s Advocacy and Next Steps
NAA continues its advocacy to remove any ambiguity about whether covered housing providers must provide this federal, pandemic-era notice requirement. Our solution, the Respect State Housing Laws Act (S. 3755/H.R. 802) removes the notice requirement from the CARES Act entirely. NAA’s advocacy remains focused on encouraging bipartisan support for this solution through co-sponsorships and exploring all avenues for passage before the end of the 118th Congress.