Iowa Supreme Court Set to Hear Argument on the Continued Validity of CARES Act Notice Requirements for Landlords

Iowa landlords are likely to receive long-awaited clarity on notice requirements under the Coronavirus Aid, Relief, and Economic Security (CARES) Act from the Iowa Supreme Court in a pending appeal case where Fredrikson attorneys, Jodie McDougal and Jack O’Brien, filed an amici curiae brief on behalf of multiple statewide landlord associations. For years, residential landlords in Iowa (and every other state) have struggled with inconsistency and confusion as to whether the additional 30-day notice to vacate requirement of the CARES Act is still applicable. While many practitioners believe this requirement was intended to be a temporary response to the COVID-19 pandemic, others believe it remains effective despite the end of the related eviction moratorium and public health emergency. Iowa judges hearing evictions have largely taken the latter position, and similar conclusions have been reached by appellate courts in a handful of other states such as Colorado and Washington.

Now, the Iowa Supreme Court is set to weigh in. On appeal are two essentially identical cases concerning whether the CARES Act’s 30-day notice to vacate requirement remains in effect indefinitely or whether it lapsed years ago. Argument on these cases will take place at the Iowa Supreme Court (1111 East Court Avenue Des Moines, IA 50319) on Tuesday, December 17, 2024, at 1:30 P.M. These arguments will also be livestreamed on the Iowa Judicial Branch’s YouTube channel.

The CARES Act

In response to the COVID-19 pandemic in 2020, Section 9058(b) of the CARES Act implemented a 120-day moratorium wherein landlords of covered property (as defined specifically in Section 9058(a)) could not evict tenants for nonpayment of rent. The federal moratorium was set to and did expire on July 25, 2020. Section 9058(c) further provided that once the moratorium period expired, a landlord could not “require a tenant to vacate” until 30 days after the landlord provided the tenant with a written notice, and such notice could not be provided any sooner than after the end of the moratorium. Per the express language of this provision, when dealing with nonpaying tenants, landlords of covered properties were to provide an additional 30-day notice to vacate in addition to the standard Iowa three-day notice of nonpayment of rent before commencing an eviction action in court. The question is whether this 30-day notice to vacate requirement is still applicable years later.

Factual & Procedural Background

The two appeals arise from separate residential lease agreements between defendant tenants (Tenants) and plaintiff MIMG CLXXII Retreat on 6th, L.L.C. (Landlord). (MIMG CLXXII Retreat on 6th LLC v. Mackenzie Miller and Parties in Possession, Linn County Case No. SCSC261751, Iowa Supreme Court Case No. 23-0670; MIMG CLXXII Retreat on 6th LLC v. Nathan Cortez Williams and Parties in Possession, Linn County Case No. SCSC261758, Iowa Supreme Court Case No. 23-0672). Tenants failed to pay rent, and Landlord served Tenants with only a three day notice (not the CARES Act’s 30-day notice) instructing them either to cure their defaults or vacate the premises. After the Tenants failed to do either, Landlord filed eviction actions against Tenants pursuant to Iowa Code § 648.1(5).

Tenants did not appear at the scheduled hearings or submit any arguments in their defense. However, the magistrate judge summarily dismissed both actions, finding the CARES Act requires landlords of covered properties to provide the 30-day notice to vacate. Landlord appealed to the district court which affirmed and also found that the notice provision remained in effect indefinitely and that it preempts Iowa law. Landlord appealed again to the Iowa Supreme Court where the cases are now pending.

Arguments

Although Tenants never appeared in these proceedings, Iowa Legal Aid has effectively argued for their interests as amicus curiae. Its argument is simple; Section 9058(c) does not specifically state that the notice requirement is temporary or ends at any point. Thus, it continues to remain in effect indefinitely until Congress intervenes, as most courts have determined.

Landlord is joined in its case by several associations comprised of some of Iowa’s largest housing providers—specifically the Greater Iowa Apartment Association, Iowa Manufactured Housing Association and Landlord of Iowa, LLC, who retained Fredrikson attorneys, Jodie McDougal and Jack O’Brien, to file an amicus curiae brief on behalf of these associations. The legal term amicus curiae is a Latin phrase that literally means “friend of the court.” Appellate courts will allow amicus curiae briefs to be filed by a party who is involved with a case, but in support of one side or another on the legal issue at hand, in cases in regarding matters of broad public interest, such as this one. Here, the Supreme Court granted permission for the aforementioned associations to file an amici brief to provide the Court with the perspective on this matter from the hundreds of landlords who are members of those associations. Landlord and these amici curiae argue that the notice requirement only applies to evictions paused by the moratorium which lapsed in July 2020 and, thus, is no longer effective. They cite the overall purpose of the CARES Act as an emergency response to the pandemic and note that this legislation was never intended to permanently supersede Iowa law, which only requires three days’ notice for these evictions.

The Iowa Supreme Court will consider the parties’ briefing (linked below) and oral argument and issue a decision in the coming months which is likely to resolve this ongoing ambiguity in the eviction process.

How Does This Impact Me?

If the Court finds the 30-day notice provision is no longer effective, then landlords can return to providing only the three days’ notice to vacate under Iowa law. If the Court provision is still effective, landlords will need to wait for Congress to pass legislation expressly invalidating the 30-day notice requirement.

If you have questions regarding anything addressed in this article, please contact Jodie McDougal (jmcdougal@fredlaw.com, 515.242.8971) or Jack O’Brien (jobrien@fredlaw.com, 515-242-8931).