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U.S. Supreme Court Terminates The CDC Moratorium On Evictions: Now What?

by | Aug 30, 2021 | Landlord-Tenant Law |

 

On August 26, 2021, the U.S. Supreme Court ruled in Alabama Association of Realtors et. al. v. Department of Health and Human Services, 594 U.S. ___ (2021) that the nationwide moratorium on evictions imposed by the Center for Disease Control (CDC) was impermissibly extended without congressional approval by the executive branch beyond January 31, 2021 and should have terminated.  The CDC had, on its own initiative, extended the moratorium through March 2021, then through June 2021, and finally beyond July 31, 2021.  When Congress did not take action, the Biden administration lacked the authority to prolong the moratorium any further.

In March 2020, Congress passed the Coronavirus Aid, Relief and Economic Security Act (CARES Act) which imposed a 120-day eviction moratorium on properties that participated in federal assistance programs or were encumbered by federally-back loans.  This first moratorium expired in July 2020 and Congress did not renew it at that time.  However, the CDC acted alone and extended the moratorium until December 31, 2020.  On December 21, 2020, Congress passed an additional $2.3 trillion appropriations package signed into law by President Trump that included extending the CDC eviction moratorium from December 31, 2020 to January 31, 2021.  This was the last time Congress took action on the eviction moratorium, but the CDC extended it on its own initiative after that time.

Realtor associations and rental property managers in Alabama and Georgia sued to enjoin the CDC’s continued moratorium.  The U.S. District Court for the District of Columbia granted summary judgment in favor of the plaintiffs and held that the CDC lacked statutory authority to impose its own moratorium without congressional action.  However, the District Court stayed its order pending appeal.  The D.C. Circuit Court and the U.S. Supreme Court agreed with the District Court that the CDC exceeded its authority, but decided to keep the stay in place since the eviction moratorium was scheduled to expire anyway on July 31, 2021.  Instead, the CDC decided to reimpose the moratorium again on August 3, 2021, so the plaintiffs returned to the U.S. District Court to ask for the stay to be lifted.  Both the trial court and the D.C. Circuit Court again agreed that the stay should be lifted, but held that they were bound by their earlier decision not to vacate the stay the first time.  In a unanimous opinion, the U.S. Supreme Court vacated the stay and effectively terminated the eviction moratorium, finding that the reasons for maintaining the stay in the first place were not the same because the harm to the realtor associations and rental property managers continues to increase while the government’s interest in preserving the moratorium continues to decrease with the passage of time.  While the government may have a valid interest in preserving the moratorium to combat the spread of COVID-19, the law “does not permit agencies to act unlawfully even in pursuit of desirable ends” and “[i]t is up to Congress, not the CDC, to decide whether the public interest merits further action here.”  If the eviction moratorium is going to continue, then it has to be through an act of Congress.

What does this mean for tenants in Michigan?  In short, this means that landlords can proceed with eviction actions in district court if you failed to pay rent or comply with other aspects of the lease agreement.  Keep in mind that tenants are still obligated to pay the rent that may have gone unpaid during the duration of the moratorium.  Tenants facing eviction should be aware of the following:

COVID Emergency Rental Assistance Program (CERA) – The Michigan State Housing Development Authority (MSHDA) oversees the CERA program that gives legal and financial help to renters who are facing eviction or utility shut-offs.  MSHDA works with a network of service providers called Housing Assessment and Resource Agencies (HARAs) to provide local assistance in all of Michigan’s counties.  The HARAs determine who is eligible for legal and financial help and determine how much monetary assistance they will get.  However, most HARAs will not consider your case or take action until your landlord takes legal action against you (e.g. serves you with a summons and complaint).  You do not need to wait (and SHOULD NOT WAIT) until the landlord actually gets a judgment against you.

Your Rights When The Landlord Initially Files Suit Against You – On July 2, 2021, the Michigan Supreme Court amended Administrative Order 2020-17 to provide the following additional procedures in landlord-tenant cases filed in the district court:

  • All local administrative orders requiring a written answer pursuant to MCL 600.5735(4) are temporarily suspended. Tenants can simply appear at the pretrial hearing on the summons paperwork without being held in default for failing to file a written answer.
  • At the initial hearing before the court noticed by the summons, the district court judge must verbally inform the tenant of the following rights:
    • Defendant has the right to counsel pursuant to MCR 4.201(F)(2).
    • Defendant must be informed that the Michigan Department of Health and Human Services (MDHHS), the local Coordinated Entry Agency (CEA), the HARA, or the federal Help for Homeless Veterans program may be able to assist the parties with payment of some or all of the rent due.
    • Defendants must be informed that they do not need a judgment to receive assistance from MDHHS, the local CEA or the HARA, for the summons and complaint are sufficient for MDHHS purposes.
    • Defendants must be made aware of the availability of the Michigan Community Dispute Resolution Program (CDRP) and local CDRP Office as a possible source of case resolution. The court must make contact with the local CDRP to coordinate resources and the chief judge can determine the extent of the CDRP in resolving summary proceedings cases, including but not limited to conducting mediation at the pretrial hearing.
    • Defendants must be informed of the possibility of a Conditional Dismissal pursuant to MCR 2.602 if approved by all parties. The parties must be provided with a form to effectuate such Conditional Dismissal.
  • Courts are authorized to proceed with these summary proceedings actions by way of remote participation tools such as Zoom in lieu of personal appearances at the district court. The summons must provide the date and time for remote participation in the scheduled hearing (with instructions).  In addition, the summons must be accompanied by any written information about the availability of counsel and housing assistance information as provided by legal aid or local funding agencies.  If the defendant was serviced with personal service pursuant to MCR 2.105(A) and fails to appear, then he or she can be defaulted.  If the defendant was not personally served with the summons, then the court cannot enter a default but rather must reschedule the hearing and mail notice that this rescheduled court appearance could require an in-person appearance.
  • In all summary proceedings cases, the hearing before the judge must be adjourned for seven days after the pretrial hearing is conducted. Parties that fail to appear at the hearing scheduled seven days after the pretrial can be defaulted.  The case does not have to be adjourned for seven days after the pretrial if the landlord decides to dismiss the complaint, or the defendant was personally served with the summons pursuant to MCR 2.105(A) and fails to appear, or both parties were represented by counsel and enter into a consent judgment or conditional dismissal that is filed with court.
  • If the case is filed for non-payment of rent pursuant to MCL 600.5714(1), then the district court must stay further proceedings after the pretrial hearing is conducted and not proceed to judgment if the defendant/tenant applies for CERA and notifies the court of the application. The stay is contingent upon ALL of the following events occurring (if any of these events do not occur, the court must lift the stay and continue with the proceedings):
    • An eligibility determination is made by the appropriate HARA within 30 days of the pretrial hearing;
    • The defendant is eligible to receive rental assistance for all rent owed; and
    • The plaintiff receives full payment from the CERA program within 45 days of the pretrial hearing.

What Happens When There Is Already A Judgment Against You? – If the landlord already has a judgment awarding possession to them for non-payment of rent, then the execution of that order has likely been stayed by the eviction moratorium until now.  This judgment issued shall allow the defendant/tenant to pay the unpaid rent or move within the 10-day minimum period under MCL 600.5744, or after the expiration of the CDC order (whichever is later).  Now the landlord can apply for a writ of eviction asking the sheriff to assist in removing the tenant from the premises.

  • Under the Michigan Court Rules, “[u]nless a hearing is held after the defendant has been given notice and an opportunity to appear, an order of eviction may not be issued later than 56 days after judgment is entered, or be executed later than 56 days after it is issued.” MCR 4.201(L)(4).
  • Under the amended Administrative Order 2020-17, the requirement under MCR 4.201(L)(4) that an order of eviction cannot be issued later than 56 days after the judgment enters is suspended for cases subject to the CDC moratorium. The 56-day period in that rule shall commence ON THE FIRST DAY AFTER THE EXPIRATION OF THE CDC ORDER IN THOSE CASES.  This means that, if 56 days has passed since the judgment, a new hearing DOES NOT have to be scheduled before the judge can sign the writ or order of eviction.  The eviction will proceed without further notice to the tenant.

The end of the eviction moratorium means that summary proceedings will continue on as they did before the COVID-19 pandemic.  If you are a landlord or tenant with questions or need legal representation, then do not hesitate to contact the experienced attorneys at Kershaw, Vititoe & Jedinak PLC for assistance today.

 

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