Local Rules Go Too Far

Massachusetts’ Supreme Judicial Court stopped enforcement of a local ordinance aimed at cleaning up problems caused by empty, foreclosed properties. Despite the blight resulting from loose lending in Springfield Massachusetts, sometimes called the City of Neighborhoods, the rules enacted by the city to govern foreclosing owners would have disrupted more comprehensive state laws. The case is Easthampton Savings Bank v City of Springfield.

State law, not localities establish foreclosure rules the SJC decided. The city rules would have empowered city inspectors to treat foreclosing lenders as owners and to impose financial burdens – including the duty to clean up toxic or hazardous conditions. Since State law already comprehensively governs foreclosures, hazardous waste and sanitary code conditions, the City could not add its more onerous rules.

The Court’s decision did not disparage the aims of the city in trying to address foreclosure-related problems but the justices said the locally enacted rules improperly interfered with elaborate existing state laws. The lawmaking body to enact such foreclosure remedies would be the State Legislature.