The Santa Monica City Council has directed the city attorney to determine by what legal means the city can challenge the Ellis Act, a state law that enables landlords to evict their tenants and go out of the rental business. The law, which went into effect July 1, is expected to be tested in the courts.
"I think it is suspect and doubtful that the Ellis Act provides the right (of landlords) to evict tenants," Councilman Dennis Zane said. "The city ought to evaluate its options and direct the city attorney, according to his judgment, to pursue the legal option that will yield the result that the right to evict without cause is eliminated."
The Ellis Act grew out of a lawsuit brought by Santa Monica landlord Jerome J. Nash. When the city refused to permit Nash to demolish a six-unit apartment building, he went to court claiming that the city's rent control law had violated his right to go out of business. Nash won in Superior Court but was reversed in the state Supreme Court. In March, 1985, the U.S. Supreme Court refused to hear the case.
This prompted state Sen. Jim Ellis (R-San Diego) to introduce a bill that prevents governments from compelling landlords to stay in the rental business.
In response, the city of Santa Monica approved an ordinance requiring landlords to pay evicted tenants relocation benefits ranging from $2,000 to $4,000 per unit, depending on the size of the residence and whether the inhabitants are senior citizens, disabled or have children.
Although the Ellis Act permits landlords to evict their tenants and go out of the rental business, city law says they cannot put their property to other uses without the permission of the Santa Monica Rent Control Board, according to David Finkel, vice chairman of the Rent Control Board and a Santa Monicans for Renters Rights candidate for the City Council.
Finkel said in a report to the council that since the Ellis Act went into effect, landlords have notified the rent board that 17 buildings containing 131 units, 78 of which are occupied, will be withdrawn from the rental market in Santa Monica. There are about 32,000 rental units in Santa Monica.
In comparison, Finkel said, San Francisco, West Hollywood and Berkeley have each seen one building taken off the rental market under provisions of the Ellis Act. All three cities have rent control laws.
"Why are the numbers larger here?" Finkel asked before the meeting. "It may be that landlords here are more active and anxious to free their land for other uses."
Finkel concluded his report by calling on the council and other city boards and agencies to "see to it that tenants are not evicted under the Ellis Act, certainly in 1986, until we see what develops" in the courts.
James Baker, a leading landlord spokesman, said landlords who are withdrawing their buildings from the market in Santa Monica are reacting to the city's rent control law.
"I think Santa Monica has far and away the most punitive rent control system in the state and therefore owners here are the most desperate," he said.
City Atty. Robert Myers refused to discuss how the city might legally challenge the Ellis Act.
But Karl Manheim, a professor of law at Loyola Law School and a lawyer who worked on the Nash case for the Santa Monica city attorney's office, said the city could pursue several avenues.
"The word eviction does not appear anywhere in the act," Manheim said. Because of that, the idea that landlords can evict their tenants under the Ellis Act is vulnerable to legal attack, he said.
Under one legal approach, the city could sue the state, asking for "declaratory relief," Manheim said. That means that the court would examine the law and then rule to clear up unsettled legal questions, such as whether the law allows landlords to evict tenants.
Or, he said, the city could wait until a tenant challenges an eviction and then file a friend-of-the-court brief supporting the tenant's right to immunity from eviction under Ellis.
John Emanuello, a tenant who is facing eviction because the building he lives in is about to be withdrawn from the market, applauded the city's action.
"Something has to be done," he said. "If landlords can get away with evicting tenants under Ellis, what will eventually happen to rent control? Eventually we will have no protection at all."
But Manheim warned that it could be difficult for the city to help tenants facing imminent eviction.
Manheim said it would be hard for the city to obtain an across-the-board injunction halting all evictions now in progress under the Ellis Act. "I think the city would have to move on a case-by-case basis" to help tenants facing imminent eviction under the act, he said.
But Gordon Gitlan, an attorney for a landlord who has notified the city that his client intends to withdraw several buildings from the rental market, said "the city should not be directing its resources to protecting one class of persons."
"If there are evictions against tenants pursuant to the law, it is strange to me that the city would direct resources to protect tenants, especially when those tenants can get their own attorneys," he said.
Gitlan also said that he foresees the day when landlords will challenge the Ellis Act to overturn "the stipulation that landlords must get city permission to change the use of their property."