Background
In 2020, during the COVID-19 pandemic, Seattle Mayor Jenny Durkan issued a temporary eviction moratorium on residential evictions in the city. Two Seattle housing providers challenged the constitutionality of eviction bans in both the City of Seattle and Washington state in the United States District Court for the Western District of Washington (district court). The housing providers argued the eviction bans violated their rights to be free from impairment of contract and from physical takings of their properties.
The district court disagreed, granting summary judgment in favor of the City of Seattle. The district court held the housing providers were unable to provide evidence the eviction moratoria were “not appropriate and reasonable ways to advance significant and legitimate goals of preventing disease transmission, housing displacement, and homelessness” … or evidence that “a physical taking occurred.” The housing providers appealed to the Ninth Circuit.
In its unpublished opinion, the Ninth Circuit affirmed the district court’s ruling, but on different grounds. As it pertained to the takings claim against Washington state, it held that Section 1983 takings claims cannot be brought against a state officer in their official capacity; therefore, the claim against the Washington Attorney General failed.
As it pertained to the City of Seattle, the Ninth Circuit held that Yee v. City of Escondido controlled in this case, and precluded the housing providers’ per se physical takings claim.
The Seattle housing providers relied on the ruling in Cedar Point Nursery v. Hassid to support their physical takings claim. The Ninth Circuit distinguished Cedar Point from the housing providers’ case, stating that in Cedar Point, the property owners objected to the occupancy of the union organizers on their land; whereas, in the Seattle case, the housing providers chose to use their property as residential rentals. Furthermore, the Ninth Circuit held the Seattle regulations still allowed housing providers to evict their residents under certain circumstances.
Lastly, the Ninth Circuit held the decision in Alabama Association of Realtors v. HHS did not affect the court’s analysis because whether the City of Seattle and Washington state had the authority to implement the eviction bans was not a question before the court.
Supreme Court Denies Certiorari
After an unfavorable decision in the Ninth Circuit, the Seattle housing providers petitioned SCOTUS to review the case. In its petition, the Seattle housing providers presented the following question to SCOTUS:
"Whether an ordinance that compels the possession of property by an unwelcome occupant is a categorical physical taking, as the Eighth Circuit held in Heights Apartments, LLC v. Walz, 30 F.4th 720 (8th Cir. 2022), or a permissible regulation of use under Yee v. City of Escondido, as the Ninth Circuit held below?"
In their petition, the housing providers stated that SCOTUS should grant their request for review to resolve conflicts between the Eighth and Ninth Circuits and between SCOTUS and the state court decisions on physical takings. The housing providers also stated that SCOTUS should grant the request to clarify that a property owner’s “limited and conditional” consent to entry does not “categorically bar” all future physical takings claims. The housing providers noted that the COVID eviction ban cases have misinterpreted Yee, with lower courts incorrectly holding that “compelled occupation” of rental units is not a physical taking because the owner agreed to the lease.
NAA, WMFHA, GRE Downtowner LLC and Weidner Apartment Homes filed a joint friend of the court brief supporting the housing providers’ petition to the Supreme Court. In their joint brief, the parties demonstrated the damaging and lingering physical and financial impact that state and local eviction moratoria have on housing providers by sharing real industry experiences with SCOTUS.
On February 20, 2024, SCOTUS denied review of the Seattle housing providers’ petition without commentary. As such, the Ninth Circuit’s ruling stands and the Seattle Moratorium on Evictions survives its latest legal challenge.
NAA remains opposed to adverse policy changes to eviction laws that impede housing providers’ ability to manage the risks associated with defaulting renters. To learn more about NAA’s Legal Advocacy Program, please contact Ayiesha Beverly, General Counsel.