Landlady, 91, Plans Appeal of Ruling on Rent Control

Attorneys for a 91-year-old landlady fighting Santa Monica’s strict rent control law say they plan to appeal, after a stinging loss last week in federal court.

U.S. District Judge Ronald S. Lew, siding with Santa Monica, granted the city’s motion for summary judgment and ruled that there was no basis for the case to continue to trial.

Lawyers for Lena Schnuck, who sought a jury trial, had argued that Santa Monica’s rent regulations were unconstitutional because they prevented the elderly woman from evicting a tenant.

But in a 14-page opinion, Lew said the 10-year-old rent control law could not be found unconstitutional because it did not deprive owners of the use and control of their property.

Temporary Setback

Landlords who hoped to use the case as a vehicle to overturn Santa Monica’s rent control law on constitutional grounds asserted that the defeat in court was merely a temporary setback.

“Our audience is not a trial judge in Los Angeles,” Robert Jagiello, Schnuck’s attorney, said. “Our audience is the Supreme Court in Washington.”

Jagiello, who recently won a case against rent control at a Santa Barbara trailer park, said he would file an appeal as soon as possible.

Attorneys for Santa Monica called Lew’s ruling a “tremendous victory” that attested to the strength of the rent control law, considered one of the toughest in the nation.

“This is another affirmation that these (legal) challenges . . . are a waste of time and resources,” said Santa Monica Deputy City Atty. Barry A. Rosenbaum, who argued before Lew.

“This should send a clear signal to any landlord organization that if they want to change the rent control law, (the court) is not the avenue,” he said.

A group of apartment owners and landlords organized in late 1987 around the Schnuck case. Calling itself the Foundation for the Defense of Free Enterprise, the group is financing Schnuck’s legal battle and has vowed to launch additional lawsuits to tackle rent control.

The group’s strategy shifted the fight over rent control out of local political and state judicial arenas to the federal court system, where a more conservative, Reagan-appointed bench might be more likely to rule in favor of the landlords.

Costly Fight

K.B. Huff, a landlord who heads the organization, sought to put Lew’s decision in the best light. By eliminating a trial and moving straight to an appellate court, he said, the case will reach a higher court sooner.

But he acknowledged that the effort is costly.

“It will cost a lot of money,” he said. “But there is more to this than money. (We are) very concerned about property rights. . . . It’s a question of what’s right and wrong.”

Rosenbaum said the city was confident its position would survive Schnuck’s appeal. “We are more than ready to meet their challenge,” he said.

Jagiello failed to convince Lew that Santa Monica’s rent control law constituted a “taking.” A taking, which is a violation of the U.S. Constitution, occurs when a government takes private property for public use without just compensation.

Her lawyer argued a taking had occurred because Schnuck was not allowed to evict a tenant from the eight-unit building she owns on Franklin Street.

Her family said Schnuck lives in one of the building’s second-floor apartments. After suffering a stroke, however, she needed to move to a first-floor apartment. But the law forbids an owner from evicting a tenant so the owner can move in if the owner already lives at the building.

Jagiello also challenged the rent control law on the grounds that it allegedly has failed to achieve its stated goals of preserving the city’s affordable housing stock and of protecting low-income and minority tenants.

Survey of Tenants

Jagiello presented a survey of 189 owners of 2,226 apartments who, all told, had filled 307 vacancies in the last two years. The survey showed that 41.7% of the new tenants had annual incomes of more than $40,000, and 3.4% of new tenants were black or Latino.

But Lew seemed uninterested in those arguments.

“This court may only review the constitutionality of the challenged law,” he wrote.

“Whether or not it is sound public policy is irrelevant to the determination made here. . . . Whether in fact the Rent Control Law is successful in achieving its intended goals is constitutionally unimportant.”

Santa Monica’s rent control law--the target of scores of legal challenges over its decade-long history--limits the amounts of rent that owners may charge and regulates evictions.

The law in Santa Monica is especially stringent because it does not allow a landlord to raise the rent when a tenant moves out of an apartment.