Alabama Association of Realtors Prevails: Another Court Rules CDC Rule Prohibiting Evictions is Invalid and Unenforceable

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A federal court in Washington, D.C. has become the latest in a growing group of courts to hold that a CDC rule prohibiting residential evictions is invalid and unenforceable in its May 5, 2021, order in Alabama Association of Realtors v. U.S. Dept. of Health and Human Services, Case No. 20-cv-3377, in the United States District Court for the District of Columbia.

Earlier this year, a federal district court in Texas ruled that Congress itself had no constitutional authority to empower the Centers for Disease Control to prohibit foreclosures and evictions because such matters do not involve “interstate commerce” and thus are outside of Congress’s power to legislate under the Constitution.

The federal district court in Washington, D.C. did not address the Constitutional limits on the power of Congress, but rather held that Congress had not authorized the CDC to make such a sweeping rule based merely on authority from Congress to combat the spread of coronavirus by very specific means, none of which involved restrictions on evictions.

In doing so, it joined and referenced cases in federal courts in Tennessee and Ohio that also found the CDC’s eviction moratorium to be beyond the authorization granted to the CDC by Congress.

The Washington, D.C. court also cited federal courts in Georgia and Louisiana, however, which declined to grant preliminary injunctions against the CDC’s eviction ban, ruling instead that the issue needs more factual development prior to issuance of a dispositive ruling.

In the Washington, D.C. case, Judge Dabney Friedrich discussed the history of Congress’s grant of rule-making authority to the CDC regarding the spread of coronavirus, which is premised on the stated goal of, “prevent[ing] 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” by “provid[ing] 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 . . . .”

Based on the above language, Judge Friedrich held that “the national eviction moratorium satisfies none of these textual limitations.  Plainly, imposing a moratorium on evictions is different in nature than “inspect[ing], fumigat[ing], disinfect[ing], sanitize[ing], . . . exterminate[ing] or destr[oying].”

Judge Friedrich also found the CDC’s position – that a general grant of Congressional authority regarding coronavirus could be interpreted so broadly, and that courts must then give “deference” to the CDC’s determination of the scope of its own authority – would raise “serious constitutional concerns” regarding Congress’s ability to so completely delegate its legislative authority to a part of the executive branch of the government.

This growing hostility in the federal courts to such broad, sweeping actions by the CDC affecting the property rights of real estate owners – coupled with some accommodation of the CDC’s claims in other courts – suggests that this issue will likely find its way through the federal Circuit Courts of Appeal and – if those Circuits do not all agree – ultimately to the Supreme Court.  These cases also provide a template for property owners to challenge the eviction and foreclosure bans imposed by the CDC and to enforce their rights under mortgages and related security agreements.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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