Apartment owners, landlords challenge state’s moratorium on evictions; Rose Law Group litigator Olen Lenets says moratorium has ‘rational basis.’ 

By Mike Sunnucks | Rose Law Group Reporter

Apartment owners and other landlords are challenging Arizona’s moratorium on evictions due to the COVID-19 pandemic.

The Arizona Multihousing Association, Manufactured Housing Communities of Arizona and some individual rental property owners are asking the Arizona Supreme Court to overturn the state’s eviction moratorium that protects tenants adversely impacted by COVID-19 and its economic ramifications. Arizona Gov. Doug Ducey issued the eviction moratorium in March at the onset of the pandemic. Ducey has extended the eviction moratorium until Oct. 31st

The landlord groups argue the governor’s order is unconstitutional and violates separation of powers and contract clause in the Arizona Constitution.

 “Our members are in the housing business. No one wants to see anyone evicted, especially during a pandemic,” said Courtney Gilstrap LeVinus, the President and CEO of the AMA. “Property owners statewide, from mom and pops to large rental communities, have done everything they can to work with residents. They’ve made payment arrangements, waived fees, helped renters fill out relief applications and worked with every agency that will listen on what’s necessary to avoid evictions.” 

Gilstrap LeVinus said the eviction moratorium essentially has created a rent holiday for some tenants. “The eviction moratorium has created a rent holiday for thousands of renters, while property owners still have a mortgage and taxes and bills to pay – including utility bills for many residents who are paying no rent. This isn’t about greed or profit. This is about a serious crisis that needs to be fixed immediately, because providing free housing while receiving no relief for seven months is not sustainable and not fair,” she said. 

The landlord groups also voiced frustration with the flow of state assistances to renters and property owners. They said there have been 20,000 housing assistance requests statewide totaling $11 million but only 7 percent of applications have been approved and $2 million deployed. 

Arizona has 190,794 COVID-19 cases and 4,383 deaths statewide, according to the Arizona Department of Health Services. Arizona has the third most COVID cases per 100,000 residents in the country behind only Louisiana and New York City, according to the U.S. Centers for Disease Control.

The pandemic has taken a major economic toll. Unemployment insurance claims in Arizona are up more than 910.5 percent compared to a year ago, according to financial research from WalletHub. The COVID pandemic has resulted in layoffs at hotels and resorts, retail stores, and other businesses. Fitness centers, led by Mountainside Fitness, have also challenged Ducey’s orders related to COVID and business closures. The landlord groups also argue the state orders are not fair to them even as many of their tenants are in economic peril. 

“When the pandemic hit, the state didn’t order grocery stores and restaurants to give away free food, or gas stations to give away free fuel, “said Gilstrap LeVinus. “Rental housing is the only area of the state economy that has been compelled to provide a product or service free of charge during the pandemic. And no other area of the economy has suddenly seen more than 920,000 legally binding private contracts made null and void by a stroke of the Governor’s pen.”

At the onset, the moratorium was meant to prevent those affected by the coronavirus, either by being infected or by losing their job, from being evicted. After Arizona failed to stem the growth of cases and became a hotbed of COVID-19, the governor extended the original moratorium end-date of July 22.

Extending the moratorium was within the governor’s authority because a rational basis of mitigating the spread of the virus through heightened physical distancing exists. The decision lies in the interest of public health.

It is important to remember that the moratorium does not outright stop evictions or relieve tenants from their duties to pay rent. A judge still reserves the discretion to order an eviction upon good showing; and tenants continue to be bound by their leases, meaning landlords are still entitled to all rents and late fees upon termination of the moratorium.

Olen Lenets, Rose Law Group Litigation Attorney
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August 2020