LA Public Interest Law Firms -- Legal Analysis re eviction moratorium (CF 20-0404) unpaid rent (CF 20-0409) and Rent Freeze (CF 20-0407) 4 21 2020

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EO for other types of evictions. Put another way, the silence on other types of evictions does notimplicitly mean the City is preempted from regulating them. The City is only preempted if there were tobe conflict with state law. The City can both comply with the Executive Order and go farther than theexecutive Order so long as there isn’t a conflict. Because state law grants local jurisdictions the authorityto regulate the substantive grounds for eviction, 26 no such conflict exists.E. A broad eviction moratorium is not unconstitutional under the Takings Clause.The proposed temporary eviction moratorium would not rise to the level of a “taking” underlongstanding case law. Both the United States Constitution and the California Constitution prohibit thetaking of private property for public use without just compensation. 27 The Takings Clause of theCalifornia Constitution is generally interpreted congruently with the Takings Clause of the FifthAmendment. 28The government’s regulation of private property will constitute a taking of such property only if itis “so onerous that its effect is tantamount to a direct appropriation or ouster.” 29 Such “regulatory takings”will constitute “per se” takings requiring compensation only if they either (i) result in a permanentphysical invasion of property or (ii) deprive a property owner of all economically beneficial or productiveuse of the property in question. 30 Otherwise, government regulation that does not result in a “per se”taking may still constitute a taking, but only if it is found to be “functionally equivalent” to a directappropriation or ouster under the “essentially ad hoc” fact-specific inquiry described in the Penn Centralcase. 31Because the proposed measure would neither result in a permanent physical invasion of propertynor in a complete deprivation of economic use of the property in question, it should be analyzed under thePenn Central standard. The Penn Central inquiry focuses on two primary factors: (i) the economic impactof the regulation on the property’s owner and (ii) the investment-backed expectations of the owner. Thisinquiry also takes into account the character of the government action – a taking is more likely to befound when the regulation can be characterized as a “physical invasion by government” as opposed to “apublic program adjusting the benefits and burdens of economic life to promote the common good.” 32 Inanalyzing whether a taking has occurred, the court does not analyze whether the owner’s rights in oneparticular segment of the property have been abrogated, but rather focuses on “the nature and extent of theinterference with rights in the parcel as a whole.” 33The threshold for a taking under the Penn Central analysis is high. In applying the Penn Centralfactors, the Ninth Circuit Court of Appeals has observed that “diminution in property value because ofgovernmental regulation ranging from 75% to 92.5% does not constitute a taking” and that it is not aware26See Fisher v. City of Berkeley (1984) 37 Cal. 3d 644, 707 (holding that a city may regulate the substantivegrounds of eviction, even to the point of “effectively eliminat[ing]” a ground for eviction in state law.) See alsoBirkenfeld v. City of Berkeley (1976) 17 Cal. 3d 129, 148-149.27U.S. Const., amend. 5, 14; Cal. Const., art. I, § 19(a).28San Remo Hotel v. City and County of San Francisco (2002) 27 Cal.4th 643, 664.29Lingle v. Chevron U.S.A. Inc., 544 U.S. 528, 537 (2005).30Lucas v. S.C. Coastal Council 505 U.S. 1003, 1015-17 (1992). A third category, not applicable here, involves aland-use exaction, where the government conditions the issuance of a development permit on a landowner’sdedication of an easement on the property allowing for public use. Lingle at 546-548; See also Nollan v. CaliforniaCoastal Comm'n, 483 U.S. 825 (1987) and Dolan v. City of Tigard, 512 U.S. 374 (1994).31Penn Cent. Transp. Co. v. New York City, 438 U.S. 104, 124 (1978); Lingle at 538; Kavanau v. Santa MonicaRent Control Bd., 16 Cal.4th 761, 774 (1997).32Penn Central at 124; Lingle at 538-39 (2005).33Tahoe-Sierra Pres. Council v. Tahoe Reg'l Planning Agency, 535 U.S. 302, 327 (2002).6
of any case in which a court has found a taking where diminution in value of the property in question wasless than 50%. 34 Moreover, a loss of profits due to a restriction on the use of the property –unaccompanied by a physical property restriction -- is generally viewed as a weak basis for a takingsclaim. 35 As the Supreme Court noted in Andrus v. Allard, “[G]overnment regulation -- by definition --involves the adjustment of rights for the public good” and that although such adjustments often limit insome way the economic exploitation of private property “[t]o require compensation in all suchcircumstances would effectively compel the government to regulate by purchase.” 36A full eviction moratorium would not constitute a taking under a Penn Central analysis becauseof its limited impact on the overall values of the affected properties, its time-limited nature, and itssimilarity to existing measures. The eviction moratorium would simply extend the existing City of LosAngeles renter protection ordinance banning the eviction of tenants for COVID-19-related nonpayment ofrent to include all tenants for the duration of the declared emergency plus 30 days. This temporaryeviction moratorium should not have any long-term economic impact on the value of rental properties andwould not defeat the investment-backed expectations of landlords, who are already subject to numerouslimitations on the right to evict. Moreover, the character of the government action is precisely that of the“public program adjusting the burdens of economic life to promote the common good” that Penn Centralexplicitly states is unlikely to support the finding of a taking.F. A temporary eviction moratorium is not unconstitutional under the ContractsClause.A temporary moratorium is also not an unconstitutional interference with existing contracts. TheContracts Clause of the Constitution prohibits only “a substantial impairment of a contractualrelationship.” 37 Even a substantial impairment may be upheld if the state has a “significant and legitimatepublic purpose behind the regulation.” 38 Courts also assess whether the adjustment of the parties’ rights isreasonable and “appropriate to the public purpose” of the regulation but generally defer to statelegislatures in making those determinations. 39 Since the end of the Lochner era, the Contract Clause hasnot been “read as a serious impediment to state social and economic legislation affecting privatecontracts.” 40In determining whether a regulation constitutes a substantial impairment, “whether the industrythe complaining party has entered has been regulated in the past” is an important consideration indetermining whether a law operates as a substantial impairment of a contractual relationship. Because“the landlord-tenant relationship is, if nothing else, heavily regulated,” new laws regulating thatrelationship are subject to less scrutiny. 41 Landlords have come to expect that the state legislature andlocal governments will enact laws that will affect their contractual relationship with tenants. In this case,in response to the COVID-19 pandemic, many policies have been adopted – between the Mayor’sExecutive Orders, the City’s adopted existing tenant protection ordinances, the multiple executive orders34Colony Cove Props., LLC v. City of Carson, 888 F.3d 445, 451 (9th Cir. 2018).35Andrus v. Allard, 444 U.S. 51, 66 (1979).36Andrus at 65.37Energy Reserves Group, Inc. v. Kansas Power and Light Co., 459 U.S. 400, 411 (1983).38Id.; United States Trust Co. v. New Jersey, 431 U.S. 1 (1977) (holding that the elimination of unforeseen windfallprofits is a legitimate state interest).39Id. at 412.40Troy Ltd. v. Renna, 727 F.2d 287, 295 (3d Cir. 1984) (citing Home Bldg. & Loan Ass’n v. Blaisdell, 290 U.S. 398(1934) (holding two-year state moratorium on foreclosure of mortgages did not violate Contract Clause)).41Id. at 297-98 (holding law that “simply enlarge[d] the terms of a statutory tenancy” was not substantialimpairment of contractual relationship).7
Page 1 and 2: April 21, 2020Honorable Members of
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LA Public Interest Law Firms -- Legal Analysis re eviction moratorium (CF 20-0404) unpaid rent (CF 20-0409) and Rent Freeze (CF 20-0407) 4 21 2020

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