Wallace v. Boston Rent Bd.

• Decision Date: 02 June 1981
• Citation: 421 N.E.2d 96,12 Mass.App.Ct. 13
• Parties: Edward T. WALLACE et al. 1 v. BOSTON RENT BOARD et al. 2 (and a companion case 3 ).
• Court: Appeals Court of Massachusetts

Page 96

421 N.E.2d 96

12 Mass.App.Ct. 13

Edward T. WALLACE et al. ¹

v.

BOSTON RENT BOARD et al. ² (and a companion case ³ ).

Appeals Court of Massachusetts, Suffolk.

Argued March 16, 1981.

Decided June 2, 1981.

Russell Fanara, Boston, for Boston Rent Bd.

James J. Cotter, III, Milton, for Edward T. Wallace and others.

Alan P. Gottlieb, Boston, for Modern Continental Enterprises, Inc.

Edward Rabinovitz, Boston, for Chandler School Properties, Inc.

Before HALE, C. J., and BROWN and KASS, JJ.

HALE, Chief Justice.

By leave of a single justice of this court the Boston rent board has appealed from an order of the Housing Court of the city of Boston denying the defendant board's motion to dismiss a part of the plaintiffs' complaints. The court ruled that regulation 10 of the board's rent regulations (1976), which sets out the procedure for implementing decontrol of Boston housing from rent control, denies due process to a tenant occupying a controlled residence at the time of its decontrol. The court also ruled that the new tenants had a right to participate in the proceedings before the board and that they should have been notified of that right. The court ordered the action remanded to the board and further ordered that the board "in the future notify new tenants of their rights." The correctness of the ruling on due process is the only issue for our review as it is dispositive of the portions of the case before us.

Regulation 10 was issued pursuant to c. 15 of the Ordinances of the City of Boston (1975), the Boston rent control ordinance. Under that ordinance, if a housing accommodation within the jurisdiction of the board is vacated after January 1, 1976, either voluntarily or by court order, the housing accommodation may be decontrolled. ⁴ See Church v. Boston, 370 Mass. 598, 599, 351 N.E.2d 212, (1976). Regulation 10 provides the procedures to be followed in effecting decontrol: the landlord must file an application, accompanied by a statement that the previous tenant left voluntarily ⁵ or pursuant to a court order. The board then must send notice to the former tenant of the application and supporting statement and inform the former tenant of the right to submit evidence or argument opposing the application within ten days after receipt of notice. The board may conduct an investigation into the facts alleged in the application and require the landlord to submit further facts and evidence. The regulation makes no provision for notifying the present tenant (hereinafter the new tenant) of the application, but does provide that "any party" may supply information and argument to the board within ten days of the filing of the application. If the board finds that there is probable cause to believe that the housing accommodation may not have been vacated voluntarily or pursuant to a court order, the board may order a hearing. The burden of proof is on the landlord throughout the application process. Following these proceedings the board is required to send notice of its decision to the landlord and the new tenant, and to any other interested parties. The notice must state reasons for the decision and that the decision may be appealed to the District Court ⁶ or to the Housing Court. ⁷

The plaintiffs in both actions are tenants residing in the defendant landlord's apartment building. In November, 1979, the landlord applied to the board for vacancy decontrol of the plaintiffs' apartments. The board did not give notice of the filing to the then current occupants, the plaintiffs. The plaintiffs in one of the actions became aware of the filing and sought, and obtained, a hearing on the applications concerning them. The plaintiffs in the other action apparently knew nothing of the applications until they received notice of their approval and of the issuance of certificates of vacancy decontrol. These board actions were timely entered in the Housing Court. ⁸

The Housing Court based its ruling that the regulation 10 procedure did not afford due process in the absence of a provision for notice to the new tenant and an opportunity for the new tenant to participate in the board's proceedings as to whether a decontrol certificate should issue.

To invoke the rights under due process principles, ⁹ a party must establish the existence of a protected interest. The plaintiffs claim that they have a protected "property" interest under the Boston rent control ordinance. ¹⁰ Their argument is based on the provision that a rented unit continues to be controlled, despite a change in occupancy after January 1, 1976, until a certificate of decontrol is issued. That argument overlooks the fact that after January 1, 1976, any person commencing a tenancy in Boston was on at least constructive notice (see Parsons v. Lenox, 228 Mass. 231, 235, 117 N.E. 197 (1917); National Fireproofing Co. v. Kelley, 253 Mass. 344, 345-346, 148 N.E. 805 (1925)) that the premises could be decontrolled, which event he could not prevent except in unusual circumstances, i. e. forced or constructive eviction of the prior tenant (see n.5). ¹¹ The plaintiffs were not warranted in expecting to be protected by rent control. See Lotto v. Commonwealth, 369 Mass. 775, 778, 343 N.E.2d 855 (1976); Regents of State Colleges v. Roth, 408 U.S. 564, 578, 92 S.Ct. 2701, 2709, 33 L.Ed.2d 548 (1972). The temporary existence of rent control protections following a vacancy does not give rise to an entitlement to continuing protection. That temporary continuance of controls is to maintain the controlled rent in effect while the board carries on its responsibilities of administrative oversight of the decontrol process. The reason for the exercise of such administrative oversight is to remove any incentive a landlord might have to cause or create a vacancy by improper means in order to secure the decontrol of the rental unit. Whatever benefit the new tenant derives from the delay is in the nature of a windfall.

Even if we assume that the plaintiffs have a protected interest, their claim, nonetheless, fails, as the process set out by regulation 10 adequately protects such an interest. Consideration of what constitutes due process involves weighing of competing interests. Lotto, supra, 369 Mass. at 780, 343 N.E.2d 855. See Mathews v. Eldridge, 424 U.S. 319, 334-335, 96 S.Ct. 893, 902-903, 47 L.Ed.2d 18 (1976). Although the tenants are not given notice of the application and the pending administrative review, they are notified of the board's decision and are informed that it may be appealed to named courts. The practice in the Housing Court is to review decontrol proceedings de novo. See, e. g., Levenson v. Boston Rent Control Administration, Boston Housing Court Department, CA 5671 (1977) (order); Massik v. Boston Rent Control Administration, Boston Housing Court Department, CA 9471 (1980) (judgment). See, also, Gentile v. Rent Control Bd. of Somerville, 365 Mass. 343, 348-349, 312 N.E.2d 210 (1974). Any rent increase resulting from an improper decontrol would have impact on the tenant only after notice under G.L. c. 186, § 12 (as amended through St. 1979, c. 251), and can be remedied promptly, simply and completely through the available judicial review following the administrative determination. See Mackey v. Montrym, 443 U.S. 1, 12, 99 S.Ct. 2612, 2618, 61 L.Ed.2d 321 (1979). Compare Bane v. Boston, 378 Mass.App. ---, ---, ^a 396 N.E.2d 155 (1979). Should hardship arise because of the time required in the appeal process, the order of the board may be stayed. See c. 15, § 11, of the Ordinances of the City of Boston (1975). We doubt that resort to judicial review will often be required. The board is a neutral body with expertise in the area and the power to conduct investigations and hold hearings. It can be expected to be reasonably accurate in its determinations, and to uncover most, if not all, of those few cases in which a rental unit has been involuntarily vacated. See Mackey, supra, 443 U.S. at 13, 99 S.Ct. at 2618. Finally, we observe that the present procedure serves the public interest (as defined by the enabling act for the Boston rent control scheme, St. 1970, c. 863, § 1) by withdrawing the governmental intrusion into the rental housing market as soon as possible after the emergency conditions which created the need for it have ceased (St. 1970, c. 863, § 2), while also preserving order in the market (see Russell v. Treasurer & Recr. Gen., 331 Mass. 501, 508, 120 N.E.2d 388 (1954)), and simultaneously protecting tenants accustomed to the protections of rent control from undue pressure to vacate.

The orders are...