The Apartment Association of Greater Los Angeles has scored a partial victory in its legal battle with the City of Los Angeles, as the court ruled to overturn one of two ordinances that landlords said imposed excessive financial burdens and conflicted with state law.
The California Court of Appeal ruled that the city’s Relocation Assistance Ordinance — which required property owners to pay tenants relocation fees after lawful rent increases on units exempt from rent control — was preempted by the Costa‑Hawkins Rental Housing Act, according to a press release via Business Wire. The court found that the ordinance undermined Costa‑Hawkins, which explicitly allows landlords of non‑rent‑controlled properties to raise rents to market value.
By forcing relocation payments when tenants voluntarily leave, the city’s rule “frustrates the purpose” of the state law, the judges wrote. The decision means owners of single‑family homes, condos and other exempt properties will no longer face financial penalties for rent adjustments.
AAGLA also challenged the city’s Threshold Ordinance, which requires landlords to wait until unpaid rent equals at least one month’s fair‑market rent before filing eviction proceedings. The court upheld that measure, finding it regulates substantive eviction grounds rather than procedural rights, likening it to “just‑cause” protections. AAGLA said it may consider further appeals.
AAGLA President Matthew Williams called the ruling “a partial victory,” saying the relocation‑fee mandate had imposed severe financial strain on small landlords and discouraged investment in rental housing. He warned that excessive regulation is driving many owners to exit the market, worsening Los Angeles’ housing shortage.
Executive Director Daniel Yukelson praised the decision as a “great result for property owners,” pointing out that it restores fairness for those operating legally outside rent‑control limits. He criticized the remaining threshold rule as inconsistent with state law allowing landlords to issue three‑day notices for unpaid rent.
Rutan& Tucker, the law firm representing AAGLA, filed the case in Superior Court before appealing it to the state’s Second District. Both ordinances took effect in March 2023.
AAGLA is an advocacy group for residential landlords founded in 1917.
– Joel Russell