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January 10, 2013: NHLP Partnered in Case Challenging PHA Garbage Policy, Federal Court Certifies Class

The United States District Court for the Central District of California has certified the class in a challenge to the long-standing practice of the Housing Authority of the City of Los Angeles (HACLA) that required 6,500 public housing tenants to pay separately for the costs of garbage collection, despite the terms of their leases and federal statutory rent limitations. The Court’s January 3, 2013 tenants’ claims are based upon federal law and the terms of their lease agreement, and seek recovery during whatever period is defined by the applicable statute of limitations. They assert that HACLA’s practice of forcing tenants to pay for garbage removal violates federal law because their total contribution for rent payments and essential housing services exceeds the statutory maximum, usually 30% of income. These federal law claims are brought both through 42 U.S.C. § 1983 and directly as an implied right of action. The tenants also seek recovery of the payments under a breach of contract claim, based on the language of their lease agreements obliging the PHA to pay the cost of “rubbish removal.” They seek declaratory and injunctive relief, damages and specific performance of the lease agreement.

Plaintiffs modified their original request to seek class certification of two separate classes: (1) for the statutory claims, all persons who have resided and/or will reside in HACLA public housing, and who have been required or will be required to pay for trash collection fees, except for residents who pay flat rents; (2) for the contract claim, all persons who have resided and/or will reside in HACLA-owned public housing, and who have been required or will be required to pay for trash collection fees. This distinction derives from the fact that public housing tenants paying flat rents do not receive a utility allowance, because utilities are included in the data upon which a PHA bases the flat rent that the tenant may elect to pay in lieu of paying income-based rents. However, on the lease claim, there is no distinction between flat rent and income-based rent tenants because HACLA used the same form lease for all tenants, which guaranteed that HACLA would be responsible for the costs of trash removal.

The court certified these classes under Rule 23(b)(3), since monetary relief is the primary relief sought. Although the tenants also seek specific performance of the lease agreement to require HACLA to provide rubbish removal, the fact that the utility allowance is now being provided addresses most of the harm caused by HACLA’s alleged breach, diminishing the need for injunctive relief.

Settlement negotiations through mediation have so far proven unsuccessful.

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