Federal Judge Strikes Down CDC’s COVID-19 Eviction Moratorium
March 29, 2021 —
Zachary Kessler, Amanda G. Halter & Adam Weaver - Gravel2Gavel Construction & Real Estate Law BlogA federal judge in Texas has declared the Centers for Disease Control and Prevention (CDC) eviction moratorium unconstitutional, holding that Article I’s power to regulate interstate commerce and enact laws necessary and proper for such regulation does not include the power to suspend residential evictions on a nationwide basis. While the court stopped short of issuing immediate injunctive relief, instead relying on the CDC to “respect the declaratory judgment” and withdraw the Order, the court stated that such relief would be available if the government does not comply with the decision. With this ruling, the most significant prohibition on residential evictions for nonpayment of rent is likely to be lifted, and many residential evictions halted or delayed under the Order may begin in earnest. While additional tenant protections remain in certain locales, this federal ruling increases the likely rate and pace of residential eviction activity across the country.
The CDC Eviction Moratorium was a nationwide order enacted under the Trump Administration in an effort to reduce the adverse economic impacts of the ongoing COVID-19 pandemic on residential tenants, and as a public health measure to prevent displacement of individuals into living situations conducive to the spread of the COVID-19. The Order allowed tenants facing eviction due to financial strains caused by the pandemic to certify in writing to their landlord that they are unable to pay full rent and that eviction would likely lead to homelessness or force the individual into unsafe congregate or shared living quarters. The CDC issued the order under its emergency pandemic powers under the Public Health Service Act. Initially in effect through December 31, 2020, the Order was subsequently extended through March 31, 2021.
Reprinted courtesy of
Zachary Kessler, Pillsbury,
Amanda G. Halter, Pillsbury and
Adam Weaver, Pillsbury
Mr. Kessler may be contacted at zachary.kessler@pillsburylaw.com
Ms. Halter may be contacted at amanda.halter@pillsburylaw.com
Mr. Weaver may be contacted at adam.weaver@pillsburylaw.com
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NJ Supreme Court Declines to Review Decision that Exxon Has No Duty to Indemnify Insurers for Environmental Liability Under Prior Settlement Agreement
November 29, 2021 —
Patricia B. Santelle & Laura Rossi - White and WilliamsOn November 1, 2021, in a single-sentence Order, the Supreme Court of New Jersey denied a request for review of a decision that ExxonMobil Corporation (Exxon) did not have to indemnify certain of its insurers over environmental liabilities as required by a previous settlement agreement. The case, entitled Home Insurance Company v. Cornell-Dubilier Electronics Incorporated, et al., has a unique and convoluted procedural history but, in short, the denial of review leaves standing a holding by the intermediate appellate court that the insurers’ “untimely notice actually prejudiced Exxon, violated the no-prejudice rule, and breached the covenant of good faith and fair dealing.” The court declined to consider the question framed by the insurers: whether the importance of enforcing settlement agreements outweighs New Jersey’s entire controversy doctrine.
The matter dated back almost thirty years, when the New Jersey Department of Environmental Protection notified the Appearing London Market Insurers (ALMI) of the potential liability of Cornell-Dublier Electronics (CDE), a former indirect subsidiary of Exxon, for pollution at a site in New Jersey. Coverage litigation followed in New Jersey, which ALMI defended under policies issued to CDE. Exxon was not named in the CDE suit nor were the policies which ALMI issued to Exxon at issue in that case; Exxon instead had its own pollution coverage case pending in New York. In June 2000, Exxon and its insurers, including ALMI, entered into a settlement agreement which (a) required Exxon to indemnify the insurers for any environmental liability claims involving its subsidiaries, and (b) provided for application of New York substantive law and litigation in New York City court for any dispute between the parties under it.
Reprinted courtesy of
Patricia B. Santelle, White and Williams and
Laura Rossi, White and Williams
Ms. Santelle may be contacted at santellep@whiteandwilliams.com
Ms. Rossi may be contacted at rossil@whiteandwilliams.com
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With No Evidence of COVID-19 Being Present, DC Trial Court Finds No Claim for Business Interruption
September 28, 2020 —
Tred R. Eyerly - Insurance Law HawaiiA D.C. Superior Court rejected a business interruption claim due to closures related to the COVID-19 pandemic. Rose's 1, LLC v. Erie Ins. Exchange, Civil Case No 2020 CA 002424 B (Order dated Aug. 8, 2020). The decision is here.
Plaintiffs owned a number of restaurants in the District of Coiumbia. Plaintiffs had commercial property coverage in a policy issued by Erie. The policy provided coverage for loss of income sustained due to interruption of business resulting directly from "loss or damage" to the insured property.
DC Mayor Bowser issued a series of orders in March 2020 which closed all non-essential businesses, including plaintiffs' restaurants. Plaintiffs filed claims with Erie. When coverage was denied, plaintiffs filed suit. Both sides moved for summary judgment.
The dispute centered on whether the closure of the restaurants due to the mayor's orders constituted a "direct physical loss" under the policy. Plaintiffs argued that the loss of use of the restaurants was "direct" because the closures were the direct result of the mayor's orders without intervening action. The court reasoned, however, that the orders were governmental edicts that commanded individuals and businesses to take certain actions. Standing alone and absent intervening actions by individuals and businesses, the orders did not effect any direct changes to the properties.
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Tred R. Eyerly, Damon Key Leong Kupchak HastertMr. Eyerly may be contacted at
te@hawaiilawyer.com
The Status of OSHA’s Impending Heat Stress Standard
May 30, 2022 —
Stephen E. Irving - ConsensusDocsThere has been much talk in the last several months about OSHA’s intent to establish a national standard to prevent heat-related injury and illness. OSHA’s Region VI, covering the states of Texas, Louisiana, Arkansas, Oklahoma, and New Mexico
[1], has had a regional emphasis program dealing with the hazards of heat stress for more than two decades, and much of the talk about a new national standard suggests modeling some aspects of the standard after the Region VI program. Region VI’s long-standing program emphasizes water, rest, and shade; acclimatization; and responding to medical emergencies.
In October 2021, OSHA issued its advance notice of proposed rulemaking (ANPRM) for Heat Injury and Prevention. The ANPRM rulemaking established a new Heat Injury and Illness Prevention Work Group within the National Advisory Committee on Occupational Safety and Health (NACOSH.)
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Stephen E. Irving, Peckar & AbramsonMr. Irving may be contacted at
sirving@pecklaw.com
First-Time Buyers Home Sales Stagnates
October 22, 2014 —
Beverley BevenFlorez-CDJ STAFFDespite a rise overall in home sales, “first-time buyer share remained unchanged from the previous two months at 29%, far behind the historical average first-time buyer share of about 40%,” reported National Association of Home Builders’ Eye on Housing. However, “[e]xisting home sales increased to the highest level of the year, having posted gains for five of the last six months, despite weakness among first-time buyers. Existing home sales increased 2.4% in September, but remain 1.7% below the same period a year ago.”
According to Eye on Housing, existing sales is expected to continue to increase throughout the year, though the first-time buyer segment is “the weak spot.”
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U.S. Homeowners Are Lingering Longer, and the Wait Is Paying Off
July 28, 2018 —
Jeremy Hill - BloombergHomeowners in the U.S. are holding on to their houses longer than they have in at least 18 years, and when they do sell, they’re reaping gains that haven’t been seen since before the housing crisis.
Those who sold in the second quarter did so after owning their homes for an average of 8.09 years, the longest stretch since Attom Data Solutions started tracking the statistic in 2000. The wait appears to be paying off: Second-quarter sellers recorded gains averaging $58,000 -- the most since the third quarter of 2007.
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Jeremy Hill, Bloomberg
Landlords, Brace Yourselves: New Law Now Limits Your Rental Increases & Terminations
March 02, 2020 —
Kyle Janecek – Newmeyer DillionCalifornia can be an especially expensive place to live. While this is the common wisdom, residents of the state are also painfully aware that location is an equally important factor. Yet, to curb unscrupulous actions in certain areas and expansive rental increases, Governor Gavin Newsom has signed AB-1482, which is a state-wide limitation on yearly rental increases, prompting potential additions to leases, and additional notices that landlords are required to give to tenants. Failure to do so may cost landlords unnecessary costs and unforeseen complications around the termination of a tenancy.
How Does the Rental Cap Work?
The law sets forth three ways that rental increases may be limited: (1) a cap of 5% plus the percent change in the cost of living; (2) a cap of 10%; or (3) where local rent or price control that restricts annual increases in the rental rate to an amount less than the state law. The cap that applies is the one that is the most restrictive on the landlord. For example, if the cost of living has gone up by 6%, and there is a local law that restricts rental increases by 15%, then the state law would cap the landlord to a rental increase of 10%.
Notably, this doesn't count any discounts or incentives that are applied to the rent, if they are (a) listed separately and (b) clearly stated within the residential lease agreement. Thus, even if the effective increase would be beyond the applicable cap, the landlord is not obligated to cap rent using the discounted rental fees.
Finally, this does not prohibit the landlord from freely setting a rent for new tenants. The cap only applies to existing tenants.
Exempt Properties from the Law
Certain properties are also exempt from the rental cap law, allowing landlords to increase rents without limitation for the residential properties below:
- Housing restricted by deed for purposes of affordable housing.
- New housing with a certificate of occupancy that has been granted within the previous 15 years.
- Condominiums or townhouses provided that the owner is not (a) a real estate investment trust; (b) a corporation, or (c) a limited liability trust.
- A duplex in which one of the units is owner-occupied as the owner's primary residence.
'Just Cause' for Terminations Is a Necessity
Notably, AB-1482 is not limited to rent restrictions. AB-1482 also restricts the ability of a landlord to evict tenants after the tenant has been occupying the property for over 12 months without just cause. Just cause includes items typical to an ordinary eviction action, such as a failure to pay rent or a default of a material term of the lease, or nuisance actions. Importantly, the legislature provided "no-fault just cause" such as the intent to occupy the real property by the owner or one of their family members, withdrawal of the property from the rental market, compliance with a government agency or an intent to substantially remodel the property.
In the event that the just cause is "no-fault," then the owner must either (a) assist the tenant in relocating by providing a direct payment of a full month's rent to the tenant within 15 calendar days of the notice; or (b) waive the payment of the last month's rent. Effectively, this puts a cost on the landlord to terminate a tenancy. Importantly, an owner's failure to do either of those actions will render the termination of tenancy void, and cannot be contractually waived.
This does not apply to any of the housing types exempt under the rental cap provision, or (a) transient and tourist hotel occupancy; (b) housing accommodations in a nonprofit hospital, religious facility, extended care facility, licensed residential care facility for the elderly, or in an adult residential facility; (c) housing accommodations in which the tenant shares bathroom or kitchen facilities with the owner; (d) single-family owner-occupied residences where the owner leases no more than two units or bedrooms; or (e) student housing for kindergartens or grades 1 to 12.
Notwithstanding, landlords must also provide additional language within their lease giving notice of the rental cap law and the tenant's rights regarding termination. This language is stated within the law, and must be given in 12 point font.
What Landlords Must Do Right Now
Ultimately, landlords will have to show more care towards termination processes and rental increases moving forward.
At a bare minimum, landlords will have to revise their form leases for new tenants and prepare addendums for any tenancies continuing in 2020. While the bare minimum is the new, state-mandated language to inform tenants of their rights, other language may be required if the landlord wishes to reserve a right to terminate in order to take occupancy for themselves.
Furthermore, for any leases going forward, any landlord that wants to provide a temporary discount or incentive to rent their units will have to include language outlining and specifically stating the presence of the discount or incentive, or chance that a tenant may contest the increase in rent as a violation of the rental cap portion of the law. Similarly, the changes above will have to be implemented as an addendum to any leases being renewed.
A failure to do any of these actions risks that a tenant may contest either the termination for being improper or an increase in rent, as an excessive rent hike.
Kyle Janecek is an associate on the firm's Transactional team, and has experience with drafting leases for landlords and tenants, real estate purchase and sale agreements, and loans secured by real estate. For more information on how Kyle can help, contact him at kyle.janecek@ndlf.com.
About Newmeyer Dillion
For 35 years, Newmeyer Dillion has delivered creative and outstanding legal solutions and trial results that achieve client objectives in diverse industries. With over 70 attorneys working as a cohesive team to represent clients in all aspects of business, employment, real estate, environmental/land use, privacy & data security and insurance law, Newmeyer Dillion delivers holistic and integrated legal services tailored to propel each client's success and bottom line. Headquartered in Newport Beach, California, with offices in Walnut Creek, California and Las Vegas, Nevada, Newmeyer Dillion attorneys are recognized by The Best Lawyers in America©, and Super Lawyers as top tier and some of the best lawyers in California and Nevada, and have been given Martindale-Hubbell Peer Review's AV Preeminent® highest rating. For additional information, call 949.854.7000 or visit www.newmeyerdillion.com.
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Coverage for Construction Defects Barred By Exclusion j (5)
April 15, 2015 —
Tred R. Eyerly – Insurance Law HawaiiThe Texas Court Appeal reversed a trial court judgment which found coverage in favor of the contractor based upon exclusion j(5). Dallas Nat'l Ins. Co. v. Calitex Corp., 2015 Tex. App. LEXIS 2002 (Tex. Ct. App. March 3, 2015).
Turnkey Residential Group, Inc., was the contractor to construct a twelve-unit townhome complex in Dallas. The owner of the project was Calitex Corporation. Construction began on November 2006. The project was to be completed by Turnkey by October 27, 2007.
Calitex filed suit against Turnkey and some of its subcontractors in February 2008. Calitex alleged problems with Turnkey's work included: (1) the stone exterior was not properly treated and leaked, and some areas were left uncovered with stone; and (2) windows leaked. It was further alleged that the quality of materials, labor and craftsmanship did not meet the standards of the contract and resulted in damages. Turnkey submitted a notice of claim to its insurer, Dallas National Insurance Company (DNIC). Coverage was denied.
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Tred R. Eyerly, Insurance Law HawaiiMr. Eyerly may be contacted at
te@hawaiilawyer.com
