Supreme Court Tackles CDC’s Eviction Moratorium and Its Effect on Philadelphia

In Alabama Association of Realtors v. Department of Health and Human Services, the Supreme Court determined the Centers for Disease Control and Prevention (CDC) exceeded its authority when imposing a nationwide moratorium on evictions of any tenants who live in a county that is experiencing substantial or high levels of COVID–19 transmission and who make certain declarations of financial need.

In March 2020, Congress passed the Coronavirus Aid, Relief, and Economic Security Act that included a 120-day eviction moratorium for properties that participated in federal assistance programs or were subject to federally backed loans. When the eviction moratorium expired in July, the CDC decided to renew it.

The new moratorium was broader than its statutory predecessor, covering all residential properties nationwide in addition to imposing criminal penalties on violators.

Originally, the CDC’s moratorium was scheduled to expire on Dec. 31, 2020, however, Congress extended it for one month as part of the second COVID–19 relief act.

As the new deadline approached, the CDC extended its moratorium through March, then again through June, and ultimately through July.

The Alabama Association of Realtors, a trade group of landlords and property owners, obtained a judgment from the U.S. District Court for the District of Columbia vacating the moratorium on the ground that it was unlawful. However, the district court stayed its judgment while the government pursued an appeal.

In June, the Supreme Court, by a 5-4 vote, declined to vacate a stay of a final judgment holding the moratorium unlawful. The Supreme Court reasoned that although it appeared the CDC’s moratorium exceeded its statutory authority, the moratorium would end in only a few weeks, and that time would allow for additional and more orderly distribution of congressionally appropriated rental assistance funds. Thus, it would be appropriate to leave the stay in place.

However, three days after the moratorium expired, the CDC reimposed it. The Supreme Court noted that the only material difference was the moratorium slightly narrowed the geographic scope. With the moratorium once again in place, the Alabama Association of Realtors returned to the district court to seek vacatur of its stay. Both the U.S. District Court for the District of Columbia and the U.S. Court of Appeals for the D.C. Circuit declined to lift the stay.

For the second time, the Alabama Association of Realtors applied to the Supreme Court for an emergency order vacating the stay.

The CDC claimed it had the authority to extend the moratorium pursuant to Section 361(a) of the Public Health Service Act (42 U.S.C. Section 264). That provision states:

“The Surgeon General, with the approval of the [Secretary of Health and Human Services], is authorized to make and enforce such regulations as in his judgment are necessary to prevent the introduction, transmission, or spread of communicable diseases from foreign countries into the states or possessions, or from one state or possession into any other state or possession. For purposes of carrying out and enforcing such regulations, the Surgeon General may provide for such inspection, fumigation, disinfection, sanitation, pest extermination, destruction of animals or articles found to be so infected or contaminated as to be sources of dangerous infection to human beings, and other measures, as in his judgment may be necessary.”

See also 42 CFR Section 70.2 (2020) (delegating this authority to the CDC).

The CDC contends that the first sentence of Section 361(a) gives it broad authority to take whatever measures it deems necessary to control the spread of COVID–19, including issuing the moratorium.

In response, the Alabama Association of Realtors argued Congress never gave the CDC the breathtaking amount of power it claims. The Alabama Association of Realtors noted 42 U.S.C. Section 264, is a rarely used statute from 1944 that has generally been used to limit quarantining infected individuals and prohibiting the import or sale of animals known to transmit disease.

Furthermore, the Alabama Association of Realtors noted that Congress must expressly and specifically authorize an agency to resolve major policy questions before it can do so, and Section 264 contains no such authorization when it comes to regulating landlord-tenant relationships throughout the country.

The Supreme Court agreed with the Alabama Association of Realtors. The Supreme Court highlighted that the second sentence of 42 U.S.C. Section 264, illustrates the breadth of the grant of authority by providing the kinds of measures that could be necessary: inspection, fumigation, disinfection, sanitation, pest extermination, and destruction of contaminated animals and articles. As emphasized by the Supreme Court, these measures directly related to preventing the interstate spread of disease by identifying, isolating and destroying the disease itself.

In contrast, the CDC’s moratorium, according to the Supreme Court, relates to interstate infection far more indirectly: if evictions occur, some subset of tenants might move from one state to another, and some subset of that group might do so while infected with COVID–19.

The Alabama Supreme Court went on to state that reading both sentences together, rather than the first in isolation, it would be a stretch to maintain that Section 361(a) gives the CDC the authority to impose this eviction moratorium. Instead, Congress must speak when authorizing an agency to exercise powers of “vast ‘economic and political significance.’”

Furthermore, the Alabama Supreme Court was particularly troubled by the unprecedented nature of the CDC’s claim. In the opinion, the Supreme Court stated the provision’s enactment in 1944, no regulation premised on it has even begun to approach the size or scope of the eviction moratorium. And it is further amplified by the CDC’s decision to impose criminal penalties of up to a $250,000 fine and one year in jail on those who violate the moratorium.

Ultimately, the Supreme Court held that the moratorium 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. Accordingly, the application to vacate the stay was granted.

Although the Supreme Court’s opinion brings an end to the CDC’s eviction moratorium, the court clearly stated that if a federally imposed eviction moratorium is to continue, Congress must specifically authorize it. By doing so, the court’s ruling clears a path for intervention by Congress.

How Does This Affect Philadelphia Landlords and Tenants?

On Oct. 28, the Pennsylvania Supreme Court granted Patrick F. Dugan, president judge of the Philadelphia Municipal Court, the authority to continue the Philadelphia Municipal Court landlord-tenant diversion program through Nov. 30, subject to continued, adequate funding in the emergency rental assistance program.

As a result of the Supreme Court’s order, landlords must first file an application for rental assistance, and participate in good faith, with the emergency rental assistance program through www.phlrentassist.org and then wait 45 days before filing a landlord-tenant complaint seeking possession based on nonpayment of rent.

— Clementa Amazan, an associate at Nochumson P.C., is the co-author of this article.

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