Manatt Appellate Senior Counsel Michael Berger filed an amicus brief on behalf of the Small Property Owners of San Francisco Institute in a case before the United States Supreme Court about if rent control is considered a physical taking.
The brief, filed in support of the Community Housing Improvement Program, stems from a suit challenging New York’s Rent Stabilization Law under the Fifth Amendment’s Takings Clause. After decisions from the Second Circuit Court of Appeals in related cases, the challenge was appealed to the Supreme Court to weigh in on if rent control is considered a physical taking.
In the brief, Berger said SPOSFI sympathizes with the City’s and the Second Circuit’s efforts to address a lack of affordable housing in New York but detailed the member represented by SPOSFI are “mom and pop” operations that will be harmed by hastily chosen solutions.
“To meet perceived needs, New York has cast its net too broadly,” Berger wrote in the brief. “It has transferred palpable interests in property from landlords to tenants. Without compensation. That, the constitution forbids.”
Berger explained the strict rules surrounding rent control have made ownership of an apartment building “something akin to a public utility, where all decisions are made by the government” and taken away property owners’ rights. He said a general rule is that physical occupation is considered a taking by the Court’s own precedent, one that may be “qualitatively worse” than what other cases have identified as takings. He added, “The landlords have lost all ability to determine who will live in their buildings. That control has shifted to their tenants.”
Further, Berger cited previous cases dating back to 1922 in which the good intentions of a governmental power, however legally or morally necessary, are constitutionally irrelevant. The power, he said, must have an underpinning in the Constitution.
“That the city professes to be seeking to do good is beside the point,” Berger wrote in the brief. “It proceeds as though recognition of a legitimate governmental goal validates whatever solution is chosen. And the Second Circuit bought into that.”
Read the full brief here.