Gonzales v. Inslee

504 P.3d 890

Gene GONZALES and Susan Gonzales, Horwath Family Two, LLC, and the Washington Landlord Association, Appellant,

v.Governor Jay INSLEE and State of Washington, Respondent.

No. 55915-3-II

Court of Appeals of Washington, Division 2.

Filed February 23, 2022

Richard M. Stephens, Stephens & Klinge LLP, 10900 Ne 4th St. Ste. 2300, Bellevue, WA, 98004-5882, for Appellants.

Zachary Jones Pekelis, Pacifica Law Group, 1191 2nd Ave. Ste. 2000, Seattle, WA, 98101-3404, Brian Hunt Rowe, Attorney at Law, Cristina Marie Hwang Sepe, Washington State Office of the Attorney, 800 Fifth Ave. Ste. 2000, Seattle, WA, 98104-3188, Jeffrey Todd Even, Office of The Attorney General, P.O. Box 40100, 1125 Washington St. Se, Olympia, WA, 98504-0100, for Respondents.

PUBLISHED OPINION

Maxa, J.

¶ 1 Gene and Susan Gonzales, Horwath Family Two, LLC, and the Washington Landlord Association (collectively, the appellants) appeal the trial court's grant of summary judgment in favor of Governor Jay Inslee and the State (collectively, the State), dismissing their declaratory judgment action challenging Governor Inslee's proclamations ordering a temporary eviction moratorium related to COVID-19.

¶ 2 In February 2020, Governor Inslee declared a state of emergency in Washington because of COVID-19. In March 2020, he issued a proclamation placing a temporary moratorium on most evictions. The moratorium was amended and extended by several subsequent proclamations until the last version expired on June 30, 2021. The governor then issued an eviction bridge proclamation, which expired on October 31, 2021.

¶ 3 Gonzales and Horwath provided rental housing in Lewis County, and their tenants had not paid rent since the governor's proclamation was issued. The appellants filed this action in Lewis County, seeking a declaration that the governor had no statutory authority to issue the eviction moratorium and the moratorium violated several constitutional provisions. The State then filed a motion to transfer venue to Thurston County, which the Lewis County trial court granted.

¶ 4 We hold that (1) this appeal is not moot because the case presents issues of substantial public interest, (2) the Lewis County trial court did nor err in transferring venue to Thurston County, (3) the Governor had authority to issue the proclamations under RCW 43.06.220(1)(h), (4) RCW 43.06.220(1)(h) did not violate the constitutional prohibition against the delegation of legislative authority, (5) the proclamations did not violate the separation of powers doctrine or deny access to the courts, (6) the proclamations did not constitute a taking of the appellants’ property, and (7) the proclamations did not constitute an unconstitutional impairment of the appellants’ contracts with their tenants.

¶ 5 Accordingly, we affirm the trial court's grant of summary judgment in favor of the State.

FACTS

Background

¶ 6 In response to the COVID-19 pandemic, on February 29, 2020 Governor Inslee declared a state of emergency in Washington. On March 18, 2020, the governor issued Proclamation 20-19,¹ which prohibited certain activities related to residential evictions under the authority of RCW 43.06.220(1)(h). The effect was to put a temporary moratorium on most residential evictions. The moratorium aimed to protect those with the inability to pay rent from being evicted from their homes in the midst of the pandemic. The purpose of the moratorium was to prevent increasing risks to life, health, and safety from the pandemic.

¶ 7 The governor issued subsequent proclamations that extended the eviction moratorium several times and provided much more detailed provisions: Proclamations 20-19.1² , 20-19.2³ , 20-19.3⁴ , 20-19.4⁵ , and 20-19.5.⁶ The final proclamation regarding the eviction moratorium, Proclamation 20-19.6⁷ , expired on June 30, 2021 and was not renewed. These proclamations prohibited landlords and related persons from engaging in a number of activities regarding evictions, which essentially prevented most evictions. One exception was if eviction was necessary because the tenant was creating a "significant and immediate risk to the health or safety of others." Proclamation 20-19.1 at 3. An exception later was added for when the landlord planned to personally occupy or sell the rented premises.

¶ 8 The proclamations also prohibited landlords from treating unpaid rent resulting from COVID-19 as an enforceable debt, unless the landlord offered and the tenant refused a reasonable repayment plan.

¶ 9 In April 2021, the legislature enacted Engrossed Second Substitute Senate Bill (E2SSB) 5160. LAWS of 2021, ch.115. Section 1 of E2SSB 5160 noted the governor's temporary moratorium on evictions "to reduce housing instability and enable tenants to stay in their homes." LAWS of 2021, ch. 115, sec. 1. E2SSB stated that the Governor's eviction moratorium would end on June 30, 2021. RCW 59.18.630.

¶ 10 E2SSB 5160 provided a number of protections for tenants, including that landlords must offer tenants a reasonable schedule for repayment of unpaid rent accruing between March 1, 2020 and six months after expiration of the eviction moratorium. RCW 59.18.630. In addition, the legislation provided for the development of court-based eviction pilot programs to facilitate the resolution of nonpayment of rent cases between landlords and tenants. LAWS OF 2021, ch. 115, sec. 7. E2SSB 5160 also allowed landlords to recover up to $15,000 from the State in unpaid rent if the tenant voluntary vacated a tenancy or if a tenant defaulted on a payment plan. RCW 43.31.605 (1)(d)(i). And it was required that landlords be given the opportunity to apply for certain rental assistance programs. LAWS OF 2021, ch. 115, sec. 12.

¶ 11 On June 29, 2021, the governor issued Proclamation 21-09⁸ as a temporary bridge between the expired eviction moratorium and the implementation of E2SSB 5160. This proclamation continued to prohibit evictions until certain provisions of E2SSB 5160 were implemented. Proclamation 21-09 was extended once, Proclamation 21-09.1⁹ , and expired on October 31, 2021.

Lawsuit and Summary Judgment

¶ 12 Gonzales and Horwath provided rental housing in Lewis County. Tenant X had been with the Gonzales’ since 2019. Tenant X had not paid rent or utilities since June 2020. The Gonzales’ asked tenant X if they planned to pay utilities and tenant X reportedly responded with "[w]hy should I pay them anything; they can't shut me off due to the Pandemic." CP at 252.

¶ 13 Tenant Y rented with Horwath. Tenant Y had not paid rent since February 2020 or utilities since March 2020. A rental management company attempted to contact tenant Y about finding a solution for paying and to inquire about tenant Y's plans or ability to pay. Tenant Y did not respond to the inquiries. No repayment plan was offered because tenant Y would not respond to any communications.

¶ 14 In December 2020, Gonzales and Horwath, joined by the Washington Landlord Association, filed a declaratory judgment action in Lewis County against Governor Inslee and the State. They sought an order declaring that the governor's proclamations ordering an eviction moratorium were void as being without statutory authority and unconstitutional under various provisions, and an order declaring that the proclamations had caused an unconstitutional taking without compensation.

¶ 15 The State filed a motion to change venue from Lewis County to Thurston County. The Lewis County trial court granted the motion under RCW 4.12.020(2) because the case involved a lawsuit against a public officer for an act done by the governor in virtue of his office.

¶ 16 Both parties subsequently filed summary judgment motions. The parties submitted declarations supporting the facts stated above. The trial court granted the State's motion on all claims and denied the appellants’ motion.

¶ 17 The appellants appeal the trial court's summary judgment order.

ANALYSIS

A. SUMMARY JUDGMENT STANDARD

¶ 18 Where the parties do not dispute the material facts of the case, we will affirm a grant of summary judgment if the moving party is entitled to judgment as a matter of law. Wash. State Legislature v. Inslee , 198 Wash.2d 561, 569, 498 P.3d 496 (2021).

B. LANGUAGE OF PROCLAMATIONS

1. Preamble

¶ 19 Proclamation 20-19 and subsequent versions all contained similar preamble language explaining the basis of the eviction moratorium:

WHEREAS, the COVID-19 pandemic is expected to cause a sustained global economic slowdown, which is anticipated to cause an economic downturn throughout Washington State with layoffs and reduced work hours for a significant percentage of our workforce due to substantial reductions in business activity...; and

WHEREAS, many in our workforce expect to be impacted by these layoffs and substantially reduced work hours are anticipated to suffer economic hardship that will disproportionately affect low and moderate income workers resulting in lost wages and potentially the inability to pay for basic household expenses, including rent; and

WHEREAS, the inability to pay rent by these members of our workforce increases the likelihood of eviction from their homes, increasing the life, health and safety risks to a significant percentage of our people from the COVID-19 pandemic; and

....

WHEREAS, a temporary moratorium on evictions throughout Washington State at this time will help reduce economic hardship and related life, health, and safety risks to those members of our workforce impacted by layoffs and substantially reduced work hours or who are otherwise unable to pay rent as a result of the COVID-19 pandemic.

Proclamation 20-19 at 1-2.

¶ 20 Proclamation 20-19.1 and subsequent versions added the following to the preamble:

WHEREAS, tenants, residents, and renters who are not materially affected by COVID-19 should and must continue to pay rent, to avoid unnecessary and avoidable economic hardship to landlords, property owners, and property managers who are economically impacted by the COVID-19 pandemic;

....

WHEREAS, it is

...