186 F. Supp. 3d 427
E.D. Pa.2016Background
- Plaintiffs (Hayes family) are enhanced-voucher beneficiaries who have occupied 538B Pine Street, a former project-based Section 8 unit, since the prior owner opted out in 2008 and the PHA issued enhanced vouchers.
- Defendant Harvey purchased the property in 2010 free of recorded encumbrances and entered a tenant-based HAP contract and a one-year Section 8 lease with the household; the lease renewed through April 30, 2015.
- Mrs. Florence Hayes (original head of household) died in February 2015; the PHA substituted Theodore Hayes as head of household on the lease.
- On February 17, 2015 Harvey sent a nonrenewal letter stating he would not renew the lease when it expired on April 30, 2015, citing plans to renovate and house a family member; a copy was sent to the PHA.
- Plaintiffs sued for declaratory and injunctive relief to prevent eviction, arguing enhanced-voucher protections create a perpetual right to remain and that termination requires "good cause." The parties filed cross-motions for summary judgment.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does §1437f(t) (enhanced vouchers) create a perpetual right to remain / bar nonrenewal at lease expiration? | Enhanced-voucher beneficiaries have the right to remain in the unit so long as it remains rental housing; owner may only end tenancy for cause. | No perpetual right; enhanced-voucher rules govern subsidy amount but do not bind an owner to renew at lease end. | Court: No perpetual right. §1437f(t) governs subsidy calculation, not an owner's obligation to renew; owner may decline to renew at lease expiration. |
| Is Defendant bound by enhanced-voucher/project-based restrictions because he bought the property after opt-out and without encumbrances? | Plaintiffs: enhanced-voucher protections persist regardless of purchaser. | Harvey: he purchased free and clear and is only bound by the tenant-based HAP and lease he signed. | Court: Harvey is bound by the tenant-based HAP/lease he signed, but those do not obligate him to renew at lease end. |
| Does the one-year opt-out notice provision (protecting tenants after owner opt-out) apply? | Plaintiffs rely on one-year notice protections given prior opt-out history. | Harvey contends one-year notice does not apply to tenant-based contracts. | Court: §1437f(c)(8)(A)’s one-year notice applies to project-based contract terminations, not to tenant-based HAP contracts; here Harvey was party to a tenant-based contract. |
| Does the "good cause" nontermination requirement restrict nonrenewal at the end of the lease? | Plaintiffs: lease can only be terminated or not renewed for good cause. | Harvey: "good cause" restriction applies only during the lease term, not to nonrenewal at expiration. | Court: Held that the statutory "good cause" restriction applies during the lease term; Congress removed the "endless lease" protection and an owner may refuse renewal at lease expiration. |
Key Cases Cited
- Barrientos v. 1801-1825 Morton LLC, 583 F.3d 1197 (9th Cir.) (discusses Congress's intent to eliminate the "endless lease" and that owners may refuse renewal)
- Feemster v. BSA Limited Partnership, 548 F.3d 1063 (D.C. Cir.) (enhanced-voucher tenants remain subject to eviction under local law and for cause)
- People to End Homelessness, Inc. v. Develco Singles Apartments Assocs., 339 F.3d 1 (1st Cir.) (owner may decline to renew project-based contract if proper notice given; injunction limited to one-year protection)
- Park Village Apt. Tenants Ass’n v. Mortimer Howard Trust, 636 F.3d 1150 (9th Cir.) (Congress intended to end ‘‘endless leases’’ in 1996 amendments)
- Owens v. Charleston Housing Authority, 336 F. Supp. 2d 934 (D. S.C.) (decision whether to renew HAP contract rests with the owner)