NYC Rent Control Law Won't Go to US Supreme Court

By Stephanie Rabiner, Esq. on April 24, 2012 | Last updated on March 21, 2019

The Supreme Court on Monday refused to hear a challenge to New York City's rent control law. In doing so, the Second Circuit's 2011 decision to dismiss the case has been affirmed.

That suit was brought by James and Jeanne Harmon, owners of an apartment building that is partially subjected to the city's rent stabilization measures. They claim the NYC rent control law unconstitutionally deprives them of their property without just compensation.

They are legally required to rent the apartments at a rate 59% below market value.

Like the Supreme Court, the Second Circuit dismissed the Harmons' suit without much fanfare. In a 6-page ruling, the circuit court unanimously ruled that the suit is without merit. The decision pointed out that prior Supreme Court rulings have said that government regulation of rental property does not constitute a taking under the Constitution.

The appellate court also relied on the fact that the Harmons had bought the building knowing it was subject to the NYC rent control law. As such, the law hasn't impeded the couple's ability to contract. Nor has it left them without remedy -- they retain the statutory ability to evict tenants.

The Supreme Court's willingness to let this ruling stand is a sign that the justices have no desire to delve into the world of rent control in the near future. New York City has perhaps the largest number of rent controlled units in the country, according to Reuters. Nearly half the city's 2 million rental units are covered by the law. If the Court had plans to take up the issue, the NYC rent control would have been the perfect avenue to do so.

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