AAGLA Previously Prevailed in Overturning One of Two Harmful City of L.A. Ordinances

Current Filing Seeks Further Review to Overturn City’s Ordinance Imposing Threshold of Past Due Rent Requirement Before Initiating Formal Collection Efforts or Eviction

The Apartment Association of Greater Los Angeles (“AAGLA”) (www.aagla.org) announced today that it has filed a Petition for Review (“Petition”) in the California Supreme Court petitioning a decision rendered by the State of California Court of Appeals, Second District, in its lawsuit seeking to prohibit the City of Los Angeles’ enforcement of Ordinance No. 187763 (“Threshold Ordinance”). Under the Threshold Ordinance, a financial threshold of past due rent (equal to one month’s fair market rent as set by the U.S. Housing and Urban Development Department) must be met prior to initiating formal collection efforts or eviction proceedings.

In its latest appeal, AAGLA challenges whether the City’s Threshold Ordinance that extends the unlawful detainer (eviction) timeline is an improper procedural restriction and therefore preempted under state law, and also whether the Threshold Ordinance prevents housing providers from initiating an unlawful detainer for nonpayment of rent in violation of state law. AAGLA has publicly stated previously that to fully prosecute unlawful detainers (evictions) in California, the timeline for doing so can extend up to six months or more and obtaining a sheriff's lockout following the rendering of a court decision can take another one to three months. The Threshold Ordinance has had the effect of extending this timeline by at least an additional 30 days.

In the same lawsuit, AAGLA prevailed at the Court of Appeals in overturning the city’s Ordinance No. 187764 (“Relocation Assistance Ordinance”), which had previously forced rental housing providers to pay substantial relocation fees when implementing a rent increase exceeding a specified amount on housing legally exempt from local and state rent stabilization rules such as in connection with single family, condominium and newly constructed properties.

The lawsuit challenging both ordinances was initially filed in the Superior Court of the State of California and was later appealed by AAGLA to the State of California Court of Appeals, Second District. Both ordinances have been in effect since March 27, 2023.

Matthew Williams, President of the AAGLA Board of Directors and a Los Angeles Area property manager stated: “While pleased with our partial victory in this matter, waiting for one month of past due rent to go by before any formal collection efforts may be initiated under the Threshold Ordinance, merely further extends an already lengthy and costly process.” Mr. Williams further commented: “Providing housing under such an extreme and complicated regulatory environment complete with fast rising costs and growing legal exposure, for many, particularly independent operators, there is no longer an appetite and little incentive to remain in the rental housing business. More than ever, our purveyors of traditionally affordable rental housing here in California are being forced out of business.”

Commenting on AAGLA’s latest legal maneuver, AAGLA Chief Executive and Executive Director, Daniel Yukelson, stated: “We are certain that the court will agree with our arguments. By imposing a requirement that forces housing providers to just sit back and do nothing while past due rent accumulates until the City’s arbitrary financial threshold has been met flies in the face of State Law allowing owners to serve 3-day notices and initiate legal proceedings to quickly recover rent owed.” Yukelson further commented, “If we do not prevail, there is no telling where harmful regulations like this past due rent threshold might end up. Already, the County of Los Angeles has imposed a two-month past due rent threshold for its unincorporated areas after considering and ultimately rejecting a three-month threshold, and nearly a dozen other jurisdictions have adopted or have considered similar horrible measures. No business can be expected to be viable under such hardships and financial obstacles.”

AAGLA is represented by the law firm of Rutan & Tucker LLP based in Irvine, California.

Founded in 1917, AAGLA seeks to promote the highest levels of professionalism within the multifamily rental housing industry. It provides a wide array of services and benefits that meet the needs of rental housing providers of all sizes, including educational seminars and member events, expert operational advice, and an extensive library of forms needed to successfully own and manage rental properties. AAGLA also serves as a powerful advocate and lobbyist for rental housing providers at the local, county, state, and federal levels of government. AAGLA maintains a Legal Fund to provide necessary resources to fund litigation seeking to protect the rights of property owners and overturn harmful regulations. For more information, go to: www.aagla.org/legalfund.

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