Landlord group still confident in federal lawsuit
CITY HALL — Attorneys this week rebuffed a federal lawsuit against Santa Monica’s 26-year-old rent control law. They claim the suit has no legal footing and comes more than two decades too late.
The lawsuit, filed Dec. 20 by a group of area landlords, alleges rent control violates the constitutional rights of property owners because it protects wealthy tenants as well as the poor, and therefore infringes on the rights of property owners without returning a substantial benefit to the state.
However, City Hall attorneys said in a prepared statement issued this week the lawsuit comes more than 20 years after the two-year statute of limitations had run its course on the 1979 rent control law. They add that the law has withstood similar legal challenges in county and state appellate courts.
“The Santa Monica rent control law was adopted by the voters of Santa Monica more than 25 years ago,” reads the statement prepared by attorney Doris Ganga. “It and similar rent control laws have been upheld as constitutional many times, and this new attack will also prove unsuccessful.”
Still, landlord advocates on Thursday vowed to press ahead with the federal lawsuit.
DEFENDING RENT CONTROL Ganga listed several unsuccessful lawsuits leveraged against City Hall’s rent control law, some by landlord attorney Rosario Perry, who also is handling the current federal case. Perry filed the lawsuit on behalf of Action Apartment Association, a group of 1,000 area landlords. “In 1999, the (Rent Control) Board prevailed in a California Supreme Court decision brought on similar grounds to the current lawsuit — (it) claimed failure to advance a legitimate state interest,” Ganga’s statement reads. “Last week, the board obtained judgment in its favor from the Los Angeles Superior Court in another lawsuit brought by Mr. Perry, which claimed that the law is unconstitutional because it allegedly has no legitimate state interest when applied to tenants who do not live in their units full time.”
Beyond that precedent, Ganga insisted the two-year statute of limitations has long since expired. Perry attempted to circumvent the statute by specifically targeting an amendment to rent control that went into effect on Dec. 20, 2002, exactly two years before his suit was filed.
“Plaintiff is more than 20 years too late in filing this lawsuit,” reads Ganga’s statement. “Section 1804(b), which mandates rent ceilings on all rent-controlled units, was amended by Santa Monica voters in November, 2002 (effective December, 2002), to conform to state law vacancy decontrol. But the limitations on rent that the lawsuit challenges have been in effect since April, 1979, and this lawsuit is far too late.”
Ganga continued by saying the courts, including the U.S. Supreme Court, have long held that consumer protection is a legitimate goal of rent control. She goes on to rebuff three federal lawsuits that Perry says prove rent control unfairly violates landlords’ constitutional rights.
“Mr. Perry states that he is relying on three recent 9th Circuit cases,” Ganga wrote. “However, the laws in those cases were different than the Santa Monica Rent Control Law, and the 9th Circuit already decided a case alleging that the Rent Control Law does not substantially advance a legitimate state purpose. It found that the Santa Monica Rent Control Law is constitutional. The court in that (1991) case said: ‘The Rent Control Law’s stated purpose is to help all Santa Monica tenants... Controlling rents to a reasonable level and limiting evictions substantially alleviate hardships to Santa Monica tenants.’”
‘A HOUSE OF CARDS’ Perry said Thursday he remained confident his case could prevail. Though the suit challenges rent control in its entirety, Perry said the goal is to protect landlords from having to subsidize wealthy tenants. A judge could establish some income standard by which tenants would be judged, Perry said.
“It is clear that if the Rent Control Board does not get their act together and adjust the rent control protection so that they are for the people that need them, the entire system will fall like a house of cards,” Perry said Thursday. “If they wish to fiddle while their city burns, the loss of rent control will be on their heads, and not caused by the housing providers of the city of Santa Monica.”
The previous cases cited by Ganga, Perry claimed, either failed to address the specific issue at hand, or were misinterpreted by the lower courts. As to the statute of limitations, Perry had this to say: “Justice is never too late. The wheels of justice grind slowly, but they grind exceedingly fine... The fallacy of her argument is that the courts have given Santa Monica 25 years to correct the housing shortage they claim exists. Anybody in City Hall will tell you the housing crisis is worse today than it was 25 years ago.
“The city has squandered their governmental credibility.”
Named as plaintiffs in the lawsuit are Action Apartment Association and local landlord Mat Millen, who for the last 25 years has lived in his five-unit apartment building in the eastside Pico neighborhood. One of Millen’s units is rented at market rate and another is rented to a low-income family with government subsidies. The other two units, Millen said, are rented at original, low rent control rates, causing him economic hardships.
While Action Apartment Association and City Hall fire the initial legal volleys in the most recent attempt to overturn rent control, Perry said he might have to drop his lawsuit if he fails to raise another $75,000. Denny Zane, co-chair of the powerful Santa Monicans for Renters’ Rights group, which introduced rent control, told the Daily Press on Monday he considered the lawsuit a “make-work program for struggling local attorneys,” referring to Perry.
Added Ganga: “This is just one of many lawsuits brought by Mr. Perry, and there will no doubt be many more. It is convenient for him that he can do free fundraising through the newspaper.”
“This is just one of many lawsuits brought by Mr. Perry, and there will no doubt be many more. It is convenient for him that he can do free fundraising through the newspaper.” — DORIS GANGA Attorney, Rent Control Board
Originally published in the Santa Monica Daily Press print edition on January 21, 2005. Read the original PDF.