Apartment Owners Are Suing WeHo, L.A. County and the State Over the Eviction Moratorium

The City of West Hollywood is one of eight cities being sued by a group of apartment owners and lessors who allege they have been forced through tenant eviction protection ordinances enacted during the coronavirus pandemic to shoulder financial burdens that should be borne by the public at large. The plaintiffs also are suing the State of California and Los Angeles County.

The plaintiffs in the suit filed in Los Angeles Superior Court include Casa Green Inc., Westside Habitats LLC, Brass Key Properties LLC, VSN Properties LLC, Hollywood Lofts LLC, Streamline Properties LLC, Terraces at the Grove Inc. and Silver Swan Properties LLC.

The cities named as defendants are Los Angeles, Beverly Hills, Santa Monica, West Hollywood, Glendale, Burbank, Agoura Hills and Santa Clarita. The suit filed Friday seeks unspecified damages “far in excess of $300,000” and a court order enjoining the government entities from requiring the plaintiffs to comply with the ordinances.

Representatives for Gov. Gavin Newsom’s office, the Los Angeles City Attorney’s Office and Los Angeles County did not immediately reply to requests for comment on the suit, which alleges the plaintiffs’ properties “have been unlawfully and illegally commandeered without compensation, just or otherwise.”

The plaintiffs contend the government entities quickly issued a series of ordinances which, among other things, created moratoriums on evictions and prohibited lessors and landlords from exercising their contractual options in cases where tenants refuse to pay rent.

“While purportedly intending to provide relief to tenants … the ordinances and other enactments are illegal, imbalanced and significantly infringe on their constitutional rights,” according to the suit, which states that “undoubtedly, a significant percentage of the tenants who have not been paying rent will not pay back the arrearages.”

According to the plaintiffs, the alleged imbalance can be demonstrated by comparisons to grocery stores, which were not directed to give patrons credit upon a showing of economic hardship created or linked to the pandemic, or service stations, which have not been mandated to slash gas prices by 100% in exchange for an IOU promising payment in a year.

Similarly, the plaintiffs say, government entities have not ordered lawyers to provide legal services on a deferred payment basis, nor have judges been told to accept half of their compensation with the promise that the balance will be paid in a year.

On the other hand, there have been no “mortgage moratoriums” for landlords who still must pay money owed to lenders, according to the suit. Historically, the cost of operating the apartments and other rental units has gone up every year, while income streams from the rentals have now plummeted, the plaintiffs say.

In addition, insurance rates are going up dramatically, due in part to issues set into motion by the coronavirus, making it even harder for the plaintiffs, whose expenses are going up while their income streams are plummeting, the suit says.

As WEHOville has previously reported, there currently are federal, state, county and City of West Hollywood eviction moratoriums, some of which seem to conflict with one another. West Hollywood’s residential eviction moratorium act gives tenants who have suffered financial impacts from the COVID-19 pandemic 12 months from its Sept. 30, 2020, expiration date to pay past their due rent. However, a description of the State of California’s recently enacted eviction moratorium, AB 3088,  posted on the state’s website   says that local ordinances must “provide a repayment schedule to begin repayment no later than March 1, 2021.”  AB 3088 also says that a county or city government cannot extend its eviction moratorium beyond the date when the state’s moratorium expires.

The West Hollywood City Council is expected to review the city’s residential and commercial eviction moratoriums at its Sept. 21 meeting.

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WeHo Poster
WeHo Poster
2 months ago

Pity the landlord! The most oppressed of them all!

Carolynn Montgomery
Carolynn Montgomery
2 months ago

I understand their position. There were no mandates to protect them from the banks. As usual in this country the banks win and everyone else loses. The rich get richer and the poor get poorer. When this is over the homeless population is going to explode. The real crisis has not yet begun, unfortunately.

Erik Jon Schmidt
Erik Jon Schmidt
2 months ago

Shawn wrote: “I am not concerned with the huge coporate (sic) landlords, but for the smaller ones.” Don’t be so presumptuous, the “smaller ones” are not suffering as much as you think. If you research property owners in West Hollywood you would be surprised to know that many, if not most of the small, run-down buildings are owned by people who are not suffering financially. They are known as “slumlords”. They charge unreasonable amounts of rent, because they know they can in West Hollywood, yet they put very little back into their buildings because the City has no reasonable standards… Read more »

Joshua88
Joshua88
2 months ago

Wow. Makes them out as real heroes, don’t it?

Having trouble opening SBA PPP list, but I am sure Mr Scott (& City News & Staff) already thought of that.

hifi5000
hifi5000
2 months ago

For a landlord to compare their apartment building to grocery stores or service stations is really stretching it.You can always go to another grocery store or service stations for comparative prices and service.With apartment rents ,you are playing with people’s homes and the prospect of homelessness. These guys are asking for it,as if they are successful with this suit and start with the promised evictions,there will be a hooting and hollering the city have never experienced.The protests seen during the summer will be a cakewalk next to what I believe will happen.Mass evictions will not be good for the public… Read more »

Tom
Tom
2 months ago
Reply to  hifi5000

It’s even more specious than that- if you don’t have money for groceries, you don’t go to the store. How many of the plaintiffs are developers who received tax breaks, incentives, and zoning changes to build their buildings?

Vigilant
Vigilant
2 months ago
Reply to  Tom

Most of the plaintiffs appear to be property management companies. Are they testing the water?

Rob Bergstein
Rob Bergstein
2 months ago
Reply to  hifi5000

No, hifi3000, I can draw a direct line for you. Tenants have been told if they’re impacted by Covid & can’t pay their rent, they don’t have to pay rent & for the foreseeable future, they won’t be evicted (and my crystal ball prediction is that when the moratoriums are lifted, you’ll see far to many tenants just walk away from their debts–and for a landlord to take someone to court, get a judgment & be able to collect on it??). You have taken one group of unemployed or underemployed and created a second layer–landlords. Sure, the large corporate landlords… Read more »

Shawn
Shawn
2 months ago

I remember back in March when the city and state put the first moratorium in place and they were asked about a delay in paying property taxes and they said “no, that’s not possible. It’s set by law and can’t be changed”. It just strikes me as unfair that they can potentially tell a landlord that the tenant can go a year without paying rent, but the state and county couldn’t delay the deadline for paying taxes, although the feds delayed their deadline. I think it is clearly a case of “public taking”. I don’t know what the solution is,… Read more »

David Abrams
David Abrams
2 months ago
Reply to  Shawn

It’s very clearly a public taking, although structuring it as a deferral and not a reduction/waiver or rent is a legal loophole. They know most, if not all, of the “deferred” rent won’t be able to be collected. The argument they’re using is valid. Why should one sector of private citizens bear the cost of the pandemic? Huge corporations like Amazon and Target are having record profits, and are even accelerating plans to open new stores. How much of those profits are coming from money that people would have otherwise been spending on rent? You can bet if lawmakers instituted… Read more »