Lawsuit over state’s eviction moratorium names Spokane, alleging ‘government-compelled physical occupation’

A policy created to protect renters during the COVID-19 pandemic is the target of class-action lawsuit from property owners in Washington, including Spokane, who claim that the policy constituted an unlawful “taking” from landlords.

The suit, filed last month in Thurston County, names Gov. Bob Ferguson, the state of Washington and several municipalities, including Seattle and Spokane, which put measures in place that prevented landlords from evicting tenants for more than a year as the nation dealt with the pandemic.

The government entities that enacted the eviction moratoriums “compelled Plaintiffs to allow tenants-turned-trespassers to occupy Plaintiffs’ property without receiving compensation – while Plaintiffs remained liable for all property taxes, mortgage payments, maintenance costs, and utility charges for a property they no longer controlled,” the suit states. “This government-compelled physical occupation of Plaintiffs’ property constituted a per se taking under the Fifth Amendment of the United States Constitution.”

One of the signatory attorneys, John DiLorenzo of the law offices of Davis Wright Tremaine in Seattle, said Tuesday that while filed, the lawsuit remains early in the process. As such, several of the defendants, including the City of Spokane, have not yet been served.

“It’s in it’s very, very early stages,” DiLorenzo said.

City of Spokane spokeswoman Erin Hut confirmed that it has not yet been served. She said officials would respond once they “receive it and once our lawyers have had time to review.”

The suit names 12 local governments “who had copycat ordinances that looked like the state’s eviction moratorium,” DiLorenzo said. “We wanted to be sure that everyone who enacted a moratorium was invited to the party.”

Spokane rental property owner Steve Otten is also a plaintiff in the suit. Efforts to reach Otten this week were not successful.

Sean Flynn, the executive director of the Rental Housing Association of Washington, said that the moratorium caused a greater financial burden on owners, like Otten, who don’t own large apartment buildings.

“The members who make up the suit are small- to mid-sized property owners,” Flynn said. “The very large housing providers weren’t affected as much as someone who owns a duplex or a single-family home.”

The state did set up a system for landowners to recoup some of the lost rent, but those funds often came with assurances that the property owners would not seek back rent from their tenants.

“A lot of our members didn’t have the resources to do the paperwork or hire an attorney,” he said. “In an emergency, that’s when the constitution matters the most. We believe our folks’ fundamental constitutional rights were violated and we look forward to having the courts look at this fact pattern again.”

DiLorenzo noted that the Washington Supreme Court has already ruled that the eviction moratorium did not constitute a taking under state law. But he noted that other courts across the country have come to different conclusions.

“We believe the Washington Supreme Court is wrong,” he said. “Because the Washington Supreme Court has determined these eviction moratoriums were not takings, and other courts across the country have determined that they were takings, our hope is that it will be reviewed by the United States Supreme Court.”

While the case challenges the legal underpinnings of the eviction moratoriums, those measures did something else: they saved lives, said Terri Anderson, the director of the Spokane office of the Tenants Union of Washington State.

She noted that each eviction causes a high degree of human interaction, including court filings, judicial rulings and eventually county deputies physically entering homes to remove tenants and belongings.

“I truly believe it not only saved the lives of tenants, but county sheriff’s deputies who didn’t have to go execute a writ of restitution,” she said.

She noted that most tenants did not stop paying rent out of choice.

“Many tenants were forced to stay home from work. They didn’t walk off the job. The were forced not to work because of emergency orders,” Anderson said. “It prevented people from having to live out on the street.”

Anderson served on a committee of tenant and landlord advocates set up by former Gov. Jay Inslee that met regularly during the moratorium.

She noted that in the early stages of the pandemic, even health officials were unsure how easily the coronavirus spread.

“It was much safer to keep everybody in place and keep all the court people in place,” she said. “To me, that was the prevailing factor of the moratorium. It was not an intent to take anything.”

DiLorenzo said that while the case remains in its early stages, it will take a while to get through the courts. If it passes some initial steps, the class of potential plaintiffs could grow substantially.

“We expect the parties will debate a motion to dismiss. That will be going on the first part of the year,” he said.

Flynn, of the rental housing association, said the suit is necessary to protect the rights of small landlords.

“We have just over 6,000 members statewide. The little guys, when you add us up, are big,” he said. “We provide the last organically occurring affordable housing in our state.”

While he understands the arguments about the emergency caused by the pandemic, he said landlords were treated differently.

“They didn’t go to grocers and say, ‘You have to provide people with food,’ ” Flynn said. “When the government takes your property for the benefit of the greater good, they have to pay you for it. The constitution is very clear on that.”