SCOTUS Rejects New York Rent Control Appeal - U.S. Second Circuit
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SCOTUS Rejects New York Rent Control Appeal

If you’re the beneficiary of New York City rent control laws, you’ll be delighted to hear that the Supreme Court declined to review a Second Circuit Court of Appeals decision upholding the decades-old policy this week.

If you’re a landlord, the denied cert is bad news.

This morning, Supreme Court orders were a long list of denials, including the death knell in James and Jeanne Harmon's case challenging New York rent control laws.

The State of New York adopted a rent stabilization law in 1946 to respond to the housing shortage after World War II. In 1962, the Legislature gave New York City the power to enact its own rent regulations. The city approved its rent stabilization law in 1969, and followed up with related laws in 2006 and 2009, reports Reuters.

The Harmons sued to challenge the rent stabilization policy in 2008, arguing that the law constituted a taking without just compensation, and violated the Due Process Clause, the Equal Protection Clause and the Contracts Clause of the Constitution, reports Thomson Reuters News & Insight. (The Harmons, who own and live in a small brownstone building on Manhattan's Upper West Side, claimed three tenants in their building pay government-set rents that 59 percent below market value.)

The courts were not receptive to the Harmons' claims. Both the federal district court and the Second Circuit Court of Appeals dismissed the case, referring to the Supreme Court's decision in Yee v. City of Escondido. In a summary order dismissing the case, the Second Circuit wrote, "The Supreme Court has held that governmental regulation of the rental relationship does not constitute a physical taking."

The Supreme Court was the first court that seemed willing to entertain the Harmons' case. In December, the Court asked the defendants in the case to submit briefs. SCOTUS interest in the case, however, was not enough to overcome precedent.

Are you surprised that the Supreme Court rejected the New York rent control case, or more surprised that they considered it at all?

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