Real Estate

For every quarter, the six-quarters section above lists the orders in force on the quarter's first and last day, by issuer, date and terms, with exhibit identifiers, and the tables on this page tabulate them. For the third quarter of 2021 alone the list runs to the CDC's eviction order in force July 1 through July 31 and August 3 through 26, 2021, addressed to every landlord in the country with criminal penalties; the FHA, FHFA, VA and USDA eviction moratoria to September 30, 2021; the CFPB's Regulation X safeguards from August 31; the eviction statutes, proclamations, procedures and court stays of sixteen jurisdictions and the territories; the remote-notarization instruments of ten States; the local eviction and court instruments of a dozen metros; the face-covering, vaccination-proof and access orders of the States, the District and the metropolitan areas named in subpart (B) of the third quarter of 2021, the workplace infection-prevention and exposure-control requirements of the Delta quarter; the State emergencies, general orders and counter-orders; the courts' orders in more than twenty States; and the federal conveyance, workplace, contractor, entry and border orders.²¹⁵ A form sentence that no orders were in effect is not the "case-by-case" determination the United States described to the District Court.²¹⁶ The sentence describes a quarter that did not occur, and the Service's records, whatever they contain, do not contain the Federal Register.

The word "essential" is not in the statute. The designation "real estate services (including appraisal and title services)" in the Illinois-list orders was the premise of the conditions those orders imposed, never an exemption from them: six-foot distancing, telework "to the fullest extent possible," gathering caps of ten that made every open house unlawful, and customers who could leave home only for enumerated purposes.²¹⁷ The Notice itself provides that an employer so designated "may be considered to have a partial suspension of operations if, under the facts and circumstances, more than a nominal portion of its business operations are suspended by a governmental order," and its own last sentence in the same answer treats a compelled closure "for a period of time during normal working hours" as a partial suspension; the United States told the District Court that an employer "could be considered to have a partial suspension due to the governmental order if it was required to suspend certain operations for certain purposes."²¹⁸ Minnesota confined the designation to "workers who facilitate and finance real estate transactions"; Mecklenburg County confined it to "appraisal and title services"; New Mexico granted it "limited to minimized operations and staff" under a prohibition of every gathering of five or more; Michigan, Pennsylvania, New York, New Jersey, Vermont, Delaware and Washington withheld it altogether for the first six to nine weeks.²¹⁹ An employer that "remained open" under an order that fixed how many persons could enter a house it was showing, and barred it from evicting the tenant who did not pay, was partially suspended by that order. The designation was a permission to operate under the orders, not an exemption from them.

The statute says nothing of the source or addressee of the order; it asks whether the order limited "commerce, travel, or group meetings." The Notice's own list of qualifying orders includes "A State's emergency proclamation that residents must shelter in place" and "An order from a local official imposing a curfew on residents," both addressed to the public, and the United States quoted that list to the District Court as the statute's meaning and told the Ninth Circuit that a business "may be suspended 'due to' a government order addressing a third party."²²⁰ The orders that reached this industry were, moreover, directed at its business operations in terms: "No in-person open houses are permitted"; "Limit in-person activities to no more than the real estate professional and two people inside a property"; "[r]eal estate services shall be conducted remotely for all transactions"; "a landlord, owner of a residential property, or other person with a legal right to pursue eviction ... shall not evict."²²¹ The position rewrites the statute and misdescribes the orders.

"Comparable operations" and "telework" are not in the statute; Tri-State defines a partial suspension as a temporary delay, interruption or termination of a portion of the business, and a brokerage whose showings, open houses, photography and closings were prohibited or confined had those portions terminated or interrupted for the duration of the orders whatever its agents did from home.²²² The Notice's own words confirm it. Q&A-15 provides that where "the closure of the workplace causes the employer to suspend business operations for certain purposes, but not others, it may be considered to have a partial suspension of operations due to the governmental order," and its Example 2 treats an employer whose customers cannot all be served remotely and whose employees "cannot access specific equipment or tools" as partially suspended; Q&A-16 provides that where the physical work space is so critical that central tasks cannot be performed remotely "this factor alone indicates that the employer is not able to continue comparable operations"; Q&A-17 provides that a compelled modification with more than a nominal effect is a partial suspension.²²³ A showing is conducted in a stranger's living room; an open house is a gathering; an appraisal is an interior inspection; a notarial acknowledgment was, until the emergency instruments rewrote it, a physical-presence act; an eviction is a courtroom proceeding; a leasing tour is a walk through a vacant unit. None is performed by telework, and the orders reached each of them. The comparable-operations sentence with which Q&A-15 opens is not in the statute, has no force of law by the United States' own account, and is not applied here.²²⁴ The position substitutes a word Congress did not write for the one it did.

The eviction orders were addressed to the landlord and property manager by name; the showing rules were addressed to "workers in the real-estate industry, including agents, appraisers, brokers, inspectors, surveyors, and registers of deeds"; the notarial instruments changed the act the title agent performs; the face-covering and exposure-control orders were addressed to every business operating an indoor public setting.²²⁵ Where an order did address the customer, it limited the industry's commerce in terms: a stay-at-home order that confined a buyer to her home was the order that made showing a house to her unlawful, and a stay-at-home order on the customer base is on the Notice's own list of qualifying orders.²²⁶ Q&A-13 excludes only a suspension claimed "because its customers are subject to a government order," and its own example describes the order as one that "limits travel"; the United States told the Ninth Circuit that an order "addressing a third party" suffices, and Q&A-12 honors third-party orders on suppliers.²²⁷ The customer exclusion was confined in April 2020 to an essential employer "not required to close its physical locations" claiming a suspension "for the sole reason" of its customers' order; the Notice extended it to every employer and to any "reduction in demand" on March 1, 2021, after every 2020 quarter had closed, in a document the United States has represented has no force of law.²²⁸ The position cannot be reconciled with the Notice it invokes.

"Voluntary" is not in the statute; "due to" is, and it means but-for causation.²²⁹ Q&A-14 by its own terms reaches only a suspension "not due to a governmental order." A brokerage that held no open house in April 2020 did so because every State's gathering cap made the open house unlawful; a property manager that filed no eviction between September 4, 2020 and July 31, 2021, or between August 3 and August 26, 2021, did so because a federal order with criminal penalties forbade it; a title agency that closed by two-way audio-video did so because the emergency instrument was the only lawful way to acknowledge the deed while the notary's desk was closed; an appraiser who delivered an exterior-only report did so because the lender's federal regulator prescribed it. Tri-State accepted the hospital's allegation that the protocols its proclamation required "were not voluntary," held that it "was required to make these changes to ensure compliance with the Proclamation," and held that on the United States' contrary theory "there are not many businesses or any business that would be eligible under the ERC at all."²³⁰ The word describes nothing that happened in this industry.

Nor does the premise of the ground survive the standing duties set out in the layers section. Q&A-14 reaches only a suspension "not due to a governmental order,"²³¹ and the United States and the District Court have defined the excluded employer as one that "chooses not to" continue comparable operations and was "not being ordered to do so."²³² No employer in this industry answered that description in any of the six quarters. The reopening orders permitted it to operate only on conditions with the force of law: appointment-only showings, party caps, occupancy limits, screening, distancing and face coverings.²³³ The standing statutes commanded the same conduct independently: Texas's communicable-disease act ("Each person shall act responsibly to prevent and control communicable disease"), its emergency act's penalty and its safe-workplace statute, the equivalents of the other principal States, and the general duty clause over all of them, enforced by citation from September 2020.²³⁴ The legislatures then fixed the standard of care as compliance with governmental standards, guidance and protocols, in Texas for every action commenced on or after March 13, 2020, in Arizona from March 10, 2020 and in Michigan from March 1, 2020.²³⁵ The safe-workplace statute had no COVID-19 content until the health authorities said what a safe workplace required; the measures were taken because those directives defined the duty and would not have been taken without them. "Due to" is but-for causation, and the causation here runs from the command to the measure without an intervening choice.²³⁶ The Notice's own words confirm it: a modification "required by a governmental order as a condition of reopening a physical space for business or service to the public," including "requiring services to be performed only on an appointment basis," is a partial suspension due to the order.²³⁷ An owner's description of that compliance as a choice is not an element of the statutory test and not evidence of the counterfactual. A statute that commands conduct is an order from an appropriate governmental authority, and the Service's premise fails wherever a command reached the employer, which in this record is everywhere.

The ten percent figure is, by the United States' own account, "not an eligibility requirement," "[e]ffectively ... a safe harbor," "a quintessential safe harbor," "a safe harbor rather than a hard floor," and, in Tri-State, "a method for the test to be met not as a requirement to meet the test"; the District Court held it "not an exclusionary cut-off point" and "subject to rebuttal."²³⁸ Congress placed its numerical thresholds in the gross-receipts prong alone.²³⁹ The figure first appeared on March 1, 2021, in a document the United States has represented has no force of law, after the FAQs of April 29, 2020 had stated no nominal test and no percentage.²⁴⁰ The Service administers the figure as a definition ("[t]he IRS considers 'more than nominal' to be at least 10% of your business") while the United States describes it to the courts as a safe harbor, and this analysis holds the United States to the account it gave the courts.²⁴¹ No proposition on this page depends on the figure. As a matter of the orders' own terms, the showing function is the origin of every commission a brokerage earns; the eviction remedy is the enforcement mechanism of every lease a property manager administers; the closing is the event at which every title fee is earned; the interior inspection is the appraiser's product. Each is the operation of the employer that performs it, and each was terminated, interrupted or delayed by order. A safe harbor the showing exceeds many times over cannot be the floor beneath which the showing fails.

The statute has no nominal-effect requirement; a partial suspension is "a temporary delay, interruption, or termination of a portion an employer's business," and "portion" is not "significant."²⁴² Q&A-18's own first paragraph lists "requiring services to be performed only on an appointment basis (for businesses that previously offered walk-in service)" and "requiring employees and customers to wear face coverings" among the modifications "required by a governmental order as a condition of reopening a physical space for business or service to the public," and Q&A-17's Example 2 holds that an employer that "resumed all categories of its business operations" remains partially suspended while a spacing order is in force.²⁴³ The modifications the orders imposed on this industry were not gloves at a checkout: they were the prohibition of the open house, the four-person and three-person showing, the vacant-unit rule, the remote acknowledgment, the exterior-only appraisal, the barred eviction, the closed recorder's counter and, in the Delta quarter, the face covering on every participant in every showing, closing and leasing tour, an airborne-transmission control imposed on every indoor workplace and public setting, and Honolulu's direction that real estate be conducted "by remote/electronic means whenever possible."²⁴⁴ The United States told the District Court that "employees having to wear face masks may impact business operations."²⁴⁵ Q&A-18's categorical sentence that mask mandates "will not result in more than a nominal effect" is a factual conclusion stated as a rule, with no record, in a document without the force of law; the facts of this industry are the orders' own terms.²⁴⁶

This analysis relies on no bare declaration as an order. Every State emergency cited in the six-quarters section is cited for the limitation it imposed or carried: Texas' declaration was the predicate of GA-38 and of the Supreme Court of Texas' emergency orders; Georgia's Economic Recovery emergency carried sector duties; Pennsylvania's Act 21 extended the Commonwealth's regulatory suspensions to September 30, 2021; Maryland's Order 21-06-15-01 continued the eviction and notarization orders to August 15, 2021; Hawaii's proclamations carried the traveler quarantine and the eviction suspension; Delaware's Sixth Modification stayed evictions "until the state of emergency is terminated."²⁴⁷ The Notice's own sentence excludes a declaration only "if it does not limit commerce, travel, or group meetings in any manner."²⁴⁸ The declarations of this record limited them in every manner the statute names.

AM 2023-005 says of itself that it "may not be used or cited as precedent," and Tri-State refused to give a Chief Counsel memorandum any weight for that reason.²⁴⁹ Q&A-12 says an employer "may be considered to have a full or partial suspension of operations due to a governmental order" when its "suppliers are unable to make deliveries of critical goods or materials due to a governmental order that causes the supplier to suspend its operations"; the words "narrow," "limited" and "exception" appear nowhere in it, and the United States told the Ninth Circuit that the rule "never even mentions a 'physical[ ] clos[ure]' order against the supplier."²⁵⁰ This industry's suppliers were closed by order in terms: the recorder's counter, the notary's physical presence, the courtroom that issues the warrant of removal, the borrower's interior, the tenant's restaurant. Each closure is an exhibit, not an inference. Where the Chief Counsel memorandum's "residual delays" sentence is invoked against a later quarter, the statute asks whether the operation was suspended "during the calendar quarter due to" orders, the suspension the orders caused continued because of them for the period the orders' own steps took, and orders were in force in every quarter through September 30, 2021.²⁵¹ AM 2023-005's scenarios stipulate a jurisdiction that "lifted all orders related to COVID in May 2020"; no State in the Library fits them.²⁵²

For every quarter, the six-quarters section lists the orders in force on the quarter's first day and its last. For the third quarter of 2021 the CDC's order of June 24, 2021 took effect July 1 and ran through July 31; its order of August 3 ran to August 26; the FHA and FHFA eviction moratoria expired September 30; New York's chapter 417, Washington's Proclamation 21-09.1, New Jersey's Executive Order 249, Illinois' Executive Order 2021-20, Oregon's indoor face-covering rule, New Mexico's order, Washington's Order 20-03.4, Nevada's Directive 047, Louisiana's Proclamation 137, the Bay Area's orders, Los Angeles County's order and the Key to NYC order were each issued inside the quarter.²⁵³ The clause asks whether the operation was "suspended during the calendar quarter," not whether an order was issued in it; Tri-State defines suspension to include a "delay"; Q&A-22 makes a suspension during any portion of a quarter eligibility for the whole quarter; and the interconnected-economy section states the restoration arithmetic from the orders' own step dates.²⁵⁴ This analysis never says an expired order suspended anyone by its own force; it says the suspension the orders caused continued because of them, and it lists the orders in force. The premise of the ground, that the orders had lifted, is contradicted by the Federal Register for every day of the quarter through September 30, 2021.

The gross-receipts prong is an alternative route to eligibility, not a condition of the suspension prong. Tri-State held that the existence of the gross-receipts test shows "an employer may be economically affected without any partial or full suspension," which "does not make the Gross Receipts Test superfluous with the plain language interpretation of 'partial suspension' but instead logical within the scope of the act," and held the prongs independent "by Defendant's admission."²⁵⁵ Congress wrote a numerical threshold into clause (II) and none into clause (I), and "where Congress includes particular language in one section of a statute but omits it in another section of the same Act, it is generally presumed that Congress acts intentionally and purposely."²⁵⁶ This analysis does not rely on the gross-receipts prong, and a letter that measures a suspension claim by a receipts decline answers a question the claim did not ask.

Every instrument in the six-quarters section is an order, proclamation, statute, rule, regulation or court order with a stated enforcement mechanism: criminal penalties under 42 U.S.C. § 271 for the CDC orders; misdemeanor liability under the State emergency acts for the stay-at-home, gathering and face-covering orders; license suspension and daily penalties under Clark County Code 3.04.065; fines of up to $2,000 per violation under Philadelphia's regulation; contempt and the withholding of warrants and judgments under the court orders; FHA's mortgagee sanctions and the Enterprises' contracts under the moratoria; the CFPB's enforcement authority under Regulation X.²⁵⁷ The Notice's own Q&A-10 counts orders "without regard to the level of enforcement."²⁵⁸ Where this analysis names a real estate commission's guidance, the order relied on is the Governor's or health officer's order the guidance applied, and where a Michigan or Pennsylvania instrument is labeled "guidance," its text is mandatory ("must be performed by appointment"; "so long as they strictly adhere to the requirements") and it issued under an executive order carrying penalties.²⁵⁹ The Court of Federal Claims itself has held that health-department guidance issued under compulsory authority "qualifies as an 'order.'"²⁶⁰ The ground mislabels the record.

Agreed, and applied. An order is "An authoritative indication to be obeyed; a command or direction"; the Service's own Chief Counsel memorandum defines it as "a command or mandate delivered by a government official."²⁶¹ Every instrument in the six-quarters section is a command of a governmental official or body, addressed to persons within its power, with a sanction for disobedience. "Commerce" is "the exchange or buying and selling of commodities on a large scale involving transportation from place to place," and in Chief Justice Marshall's words "it is intercourse"; "travel" is "to go on or as if on a trip or tour"; a "meeting" is "an act or process of coming together."²⁶² An order that forbids a stranger to enter a house for sale, closes the counter at which a deed is recorded, bars a landlord from removing a tenant, or requires every person in a leasing office to wear a face covering as an airborne-transmission control limits commerce, travel and group meetings in the ordinary meaning of each word. The ordinary meaning is the statute's meaning, and it is the meaning this analysis applies.