In Re the Estate of: Constance Marie Vossberg, a/k/a Constance M. Vossberg.
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (1998).
STATE OF MINNESOTA
IN COURT OF APPEALS
Cimarron Village Townhomes, Ltd.,
Filed July 27, 1999
Reversed and remanded
Dakota County District Court
File No. C5-98-15671
Christopher A. Lidstad, Robert B. MacDonald, Hinshaw & Culbertson, 3100 Piper Jaffray Tower, 222 South Ninth Street, Minneapolis, MN 55402 (for respondent)
David P. Simmons, Michael Hagedorn, Paul Onkka, Southern Minnesota Regional Legal Services, Inc., 16174 Main Avenue, Prior Lake, MN 55372 (for appellant)
Considered and decided by Harten, Presiding Judge, Parker, Judge, and Thoreen, Judge.[**]
U N P U B L I S H E D O P I N I O N
Appellant seeks reversal of the district court's grant of summary judgment. She argues that respondent violated 26 U.S.C. § 42(h)(6)(B)(i) (1994), by terminating her lease on a federally subsidized housing unit without good cause, where respondent had signed an extended low-income housing commitment agreement. We reverse and remand.
D E C I S I O N
On appeal from summary judgment, this court asks two questions: whether there are any genuine issues of material fact and whether the district court erred in its application of the law. State by Cooper v. French, 460 N.W.2d 2, 4 (Minn. 1990). The reviewing court must also view the evidence in the light most favorable to the party against whom summary judgment was granted. Fabio v. Bellomo, 504 N.W.2d 758, 761 (Minn. 1993). The construction of a statute is a question of law and thus fully reviewable by an appellate court. Hibbing Educ. Ass'n v. Public Employment Relations Bd., 369 N.W.2d 527, 529 (Minn. 1985).
Appellant Cynthia Washington signed a one-year lease for a townhouse in a complex managed by respondent Cimarron Village. The complex is federally subsidized pursuant to 26 U.S.C. § 42 (1994) (Internal Revenue Code). Under section 42 of the code, a developer may qualify for tax credits by making an "extended low-income housing commitment" (extended commitment) pursuant to 26 U.S.C. § 42(h)(6)(B). A developer first commits to a compliance period of 15 years, which is followed by an extended-use period of at least 15 years or another period of time as agreed upon by the developer and the state agency. 26 U.S.C. § 42(h)(6)(D), (i)(l). When Cimarron, without good cause, declined to renew Washington's lease in 1998, the housing complex was in both the compliance period and extended-use period. See id., § 42(h)(6)(D) (providing that extended-use period begins during compliance period).
Washington argues that the plain language of 26 U.S.C. § 42(h)(6)(B)(i), with its reference to 26 U.S.C. § 42(h)(6)(E)(ii)(I)-(II), prohibits the eviction, except for good cause, of residents of any housing unit that is governed by an extended commitment agreement. We agree. The statutory language at issue provides:
For purposes of this paragraph, the term "extended low-income housing commitment" means any agreement between the taxpayer and the housing credit agency--
(i) * * * and which prohibits the actions described in subclauses (I) and (II) of subparagraph (E)(ii).
26 U.S.C. § 42 (h)(6)(B). The above referenced subclause I, which is the only applicable clause here, prohibits "the eviction or the termination of tenancy (other than for good cause) of an existing tenant of any low-income unit." Id., § 42(h)(6)(E)(ii)(I).
Our analysis of the proper construction of this statute is guided by the rules of construction for provisions of the Internal Revenue Code, which states:
No inference, implication, or presumption of legislative construction shall be drawn or made by reason of the location or grouping of any particular section or provision or portion of this title.
26 U.S.C. § 7806(b) (1994).
Respondent argues that subclause (E)(ii)(I) is applicable only where an extended commitment for a qualified low-income building is prematurely terminated, either because of foreclosure or because a buyer cannot be found who is willing to continue the building's low-income status. Respondent reasons that 26 U.S.C. § 42(h)(6)(B)(i) incorporates by reference not only subclauses I and II, as the plain language suggests, but all of subparagraph (E)(ii) and that subclause I must be read in the context of the prefatory language of subparagraph (E)(ii). Under this analysis, the prohibition on eviction, except for good cause, would exist only during the three years immediately following a premature termination of a qualified low-income building. But this analysis would also require that 26 U.S.C § 42(h)(6)(E) be read as a whole, and the language of section 42(h)(6)(B)(i) does not impose such a requirement. In addition, respondent's analysis would require a presumption of legislative construction that is specifically prohibited by 26 U.S.C. § 7806(b).
The language of section 42(h)(6)(B)(i) states "and which prohibits the actions described in subclauses (I) and (II) of subparagraph (E)(ii)." 26 U.S.C. § 42(h)(6)(B)(i) (emphasis added). It does not state "which prohibits the actions described in subparagraph (E)(ii)." We must, therefore, consider only the specifically referenced language and read subclauses (I) and (II) alone without any of the prefatory language of subparagraph (E)(ii). Such a reading requires a finding that subclause (I), which prohibits eviction except for good cause, applies during the entire period of an extended commitment agreement.
Respondent also argues that applying the prohibition of eviction without good cause to the entire extended commitment creates an "endless lease" and discourages landlords from participating in low-income housing programs. We do not find this argument persuasive. Respondent, or any other landlord, may bring an action in the district court to evict a tenant for good cause and, therefore, the statutory objective of providing low-income housing is protected. We conclude, therefore, that the district court erred in its construction of the statute, and we reverse.
Because we find that the meaning of the statute at issue is unambiguous, we need not consider the legislative history of the statute. But were we to do so, our conclusion would be the same. The "good cause" prohibition was first added to subparagraph (E)(ii) as part of the Revenue Reconciliation Act of 1989. Pub. L. No. 101-239, § 7108, 103 Stat. 2106, 2309-10 (1989). As part of the Revenue Reconciliation Act of 1990, the phrase "and which prohibits the actions described in subclauses (I) and (II) of subparagraph (E)(ii)" was added to section 42(h)(6)(B)(i). Pub. L. No. 101-508, § 11, 701, 104 Stat. 1388, 1388-506 (1990) (adding technical corrections). Had Congress intended the prohibition on eviction without good cause to apply only in cases of premature termination of a qualified low-income building, there would have been no reason to reference subclauses (I) and (II) of subparagraph (E)(ii) because the necessary language to accomplish that goal was already in place. The addition of the reference to the actions described in subclauses (I) and (II) suggests Congress was not satisfied with the result of the 1989 legislation. Further, a document produced by the Joint Committee on Taxation corroborates this conclusion and provides the court with insight into Congress's intent. The document states
that the extended low-income housing commitment must prohibit the eviction or termination of tenancy (other than for good cause) of an existing tenant of a low-income unit * * *.
Joint Committee on Taxation, Description of H.R. 5454 (The Technical Corrections Act of 1990) (JCX-25-90), Aug. 3, 1990.
Because we find that the plain meaning of the statutory language prohibits the eviction of tenants without good cause at any time within an extended low-income housing commitment, we reverse the district court's grant of summary judgment and remand this case for further proceedings consistent with this opinion.
Reversed and remanded.
[*] Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to Minn. Const. art. VI, § 10.
[**] Retired judge of the district court, serving as judge of the Minnesota Court of Appeals by appointment pursuant to Minn. Const. art. VI, § 10.