Legal Update: Recent Developments in Fair Housing Law

This month, Fair Housing Coach reviews recent developments—court rulings, settlements, and enforcement agency actions—in fair housing law. Staying on top of developments may help you to avoid common problems that so often lead to fair housing trouble and resolve minor grievances before they escalate into formal fair housing complaints.

Disability discrimination remains the most frequent source of fair housing trouble. In this lesson, we’ll review recent court cases in which communities found themselves in court to defend how they handled requests for emotional support animals, ramps, and other disability-related requests. Reviewing the cases may help you avoid similar problems at your community.

You’ll also read about a community that successfully defended its handling of a reasonable accommodation request. The case shows not only what to do right when dealing with disability-related requests for exceptions to your rules, but also how to deal with neighbors who object when you make an exception for someone else.

In Legal Update, the Coach continues our coverage of a developing trend, which could lead to expansion of the definition of sex discrimination to cover claims based on sexual orientation and gender identity. And in News Notes, we highlight recent settlements costing communities thousands—in one case, hundreds of thousands—to resolve allegations of sexual harassment and discrimination based on national origin and families with children. Finally, you can take the Coach’s Quiz to see how much you’ve learned.

RECENT CASES

Resident Claims Request for Emotional Support Animal Was Met with Threats to Evict Her

In May 2018, a court refused to dismiss a lawsuit against a Florida condominium community accused of violating fair housing law by refusing to relax its no-pet policy for a resident’s emotional support animal.

ALLEGATIONS: According to the complaint, the resident rented a condo unit for three years from its owner, who was a member of the community’s homeowners association (HOA). She lived there with her minor daughter under a month-to-month tenancy. Allegedly, the resident was under medical supervision for post-traumatic stress disorder (PTSD).

In early 2017, the resident claimed that her doctors suggested that she get an emotional support animal. Some months later, she said she discussed it with her landlord and submitted a written accommodation request, along with a letter from her healthcare provider that she needed a service dog due to her PTSD. At that time, the resident said that the landlord didn’t raise any objections, telling her only to “pick up after” the dog.

Soon after, however, the resident received a letter from her landlord, informing her that she couldn’t have a dog in the unit because dogs weren’t allowed at the community. Allegedly, the landlord stated that she had spoken to “our manager,” who she said was sure to “fight it.” The resident believed that the landlord was referring to the HOA’s treasurer, who also its registered agent.

A short time later, the resident claimed that the landlord sent her a text in which she was threatened with eviction. In response, the resident said she gave the landlord a second letter from her doctor stating her medical need for an emotional support dog. About a week later, the landlord allegedly sent the resident a notice to vacate, indicating that her month-to-month tenancy was terminated as of the end of the month.

The resident retained counsel, who contacted the manager to request information about the community’s reasonable accommodation policy. Allegedly, the manager refused the request and referred the lawyer to the HOA’s counsel, whom the lawyer contacted to request a reasonable accommodation.

According to the complaint, it was a day or so later—on the day before the resident’s tenancy was to terminate—that the HOA’s attorney notified the resident that her reasonable accommodation request for an emotional support dog was granted.

Nevertheless, the resident sued the HOA, its manager, and her landlord for discriminating against her because of her disability and unlawfully denying her reasonable accommodation request.

The community asked the court to dismiss the case, arguing that she couldn’t sue because the community had already granted her accommodation request and she still lived there with the dog.

DECISION: Denied in part.

REASONING: The court allowed the resident to pursue most of her fair housing claims but dismissed any claim that she was treated differently than other residents because of her disability.

The court refused to dismiss the resident’s claim that the community discriminated against her because of her disability. The complaint alleged that the community attempted to evict her, served her with termination notices, and harassed her after she made a disability-related reasonable accommodation request to keep an emotional support animal.

The court said she could pursue the claim even though she wasn’t actually evicted—and was allowed to live there with her assistance animal—when the community granted her accommodation request just before her tenancy was to end. Fair housing law protects renters not only from eviction, but also from discriminatory actions that would lead to eviction but for an intervening cause.

The resident could also pursue her failure-to-accommodate claim. Even though the community ultimately granted her request, the resident alleged that the nearly two-month delay between her initial request to her landlord and the attorney’s letter granting her request was unreasonable, and in essence amounted to the same thing as an outright denial.

• Carlson v. Sunshine Villas HOA Inc., Florida, May 2018

Community Accused of Denying Rental After Applicant Requested Wheelchair Ramp

A court recently ruled that a Missouri community must pay $7,000 in damages and penalties for violating state fair housing law by refusing to rent to an applicant who requested a wheelchair ramp at the building entrance.

ALLEGATIONS: The case dates back to February 2010, when a married couple visited the community after determining that it could potentially accommodate the wife’s disability, which required her use of a wheelchair. During their visit, they met with a manager, although the couple and the manager later recounted different version of events that day.

According to the couple, the manager showed them the community’s two-bedroom display unit (because there were no available ground-floor units and the one-bedroom model could be accessed only by using stairs). The wife was able to easily navigate the display unit in her wheelchair.

According to the couple, the manager told them that a ground-floor two-bedroom unit (later identified as Unit 1915C) would be available in April. She took them to the building, where she opened the security door and allowed the husband to lift the wife over the three-quarter inch threshold into the building. The manager explained that she couldn’t show them Unit 1915C because it hadn’t yet been cleaned, and they declined her offer to show them the available one-bedroom unit accessible only with stairs. Before leaving the community, the couple said they told the manager that they would need a ramp to be built to the building’s entrance and that the manager responded that she would speak to the community’s owner.

The manager had a different version of what happened. She denied that she showed them inside the building’s security door or that she discussed the possibility of a ramp during the visit.

Before hearing back about the ramp, the couple returned and submitted an application, an application fee, and a security deposit for what they believed was for unit 1915C, the ground-floor unit where the manager led them six days earlier and indicated would be available in April. Their preferred move-in date was in mid-March, but they later said their move-in date was “flexible.” According to the couple, it was only after they paid the fees that the manager informed them that it wouldn’t be possible to build the ramp to the building.

Two days later, the couple submitted a written request to have a ramp built at the building entrance to unit 1915C at their expense, but they said they received no response.

Two weeks later, the couple filed a disability discrimination complaint with the state’s human rights commission. A few weeks after that, unit 1915C was rented to someone else.

At the hearing, the community denied that they refused to rent to the couple, citing a legitimate, nondiscriminatory reason that the couple couldn’t rent unit 1915C: It was unavailable either when they submitted an application or on their preferred move-in date.

Siding with the couple, the commission found the community liable for disability discrimination and ordered it to pay $5,000 in damages to the couple and a $2,000 civil penalty.

After a series of proceedings, the community appealed.

DECISION: Affirmed.

REASONING: The community was liable for violating state fair housing law: The couple proved that they made a good faith offer to rent from the community and that the wife’s disability was a factor in the community’s decision not to rent to them.

Although the community argued that the unit the couple wanted was unavailable, there was enough evidence to show that its stated reason for not renting to the couple was merely a pretext. Despite the couple’s obvious interest in renting unit 1915C and flexibility regarding their move-in date, the community didn’t attempt to rent to them at the end of March, when the previous lease ended.

The community protested that it had no time to address the couple’s request to build the ramp before the couple filed the discrimination complaint. The court disagreed, noting that the community had more than a month after learning that the couple would require a ramp to consider the request. Although the prior lease ended days before they filed their complaint, the community neither offered nor attempted to negotiate with the couple regarding Unit 1915C either before or after they filed their complaint and chose instead to rent it to someone else three weeks later.

• Vermett v. State ex rel. Henderson, Missouri, February 2018

Neighbor Objects When Family Allowed to Install Fence Around Their Yard

An Ohio homeowner’s association recently fended off a lawsuit from a resident who objected to its handling of a reasonable accommodation that allowed her next-door neighbors to fence their yard to protect their young daughter from a water hazard. 

ALLEGATIONS: Both families lived in single-family homes with backyards that abutted a lake. Community rules banned residents from putting up fences, plantings, or enclosures in backyards without prior written consent of the architectural committee.

One family, parents of a toddler and newborn, requested permission to put up a four-foot black wrought-iron fence along the backyard to protect the children’s safety. They later offered to make it only three feet, but the request was denied.

A year later, the family submitted a second request, this time for a fence around their yard, referencing their older daughter’s “well-documented disability,” and citing federal fair housing law.

Upon receipt of the request, the HOA president (who was also on the architectural committee) requested documentation about the daughter’s disability. In response, the family submitted letters from four of the daughter’s healthcare providers, including her doctor, who said that the two-and-half-year-old girl had limited reasoning skills and severe motor and language delays. Because of her impairments, the doctor said that the girl needed a safe environment because she had limited understanding of physical dangers and difficulty with motor skills to avoid such dangers.

At a meeting, the HOA discussed and approved placement of a perimeter fence upon the condition that the family would remove the fence if they moved, the fence was no longer medically necessary, or the daughter turned 18. In addition, the family had to submit annual documentation of the daughter’s continuing disability.

After the family installed a three-foot wrought iron fence around their yard, their next-door neighbor contacted the property manager to make sure the board addressed what she believed to be a clear violation of the rules against backyard fences. The HOA president responded by informing her that the family had been granted permission to install the fence in response to a request for accommodation under fair housing law.

Displeased, the neighbor condemned the board’s failure to notify her before allowing the family to put up the fence. She invited the board to see the “unsightly” view created by the fence and demanded copies of the medical documentation provided by the family to the board. The board refused.

The neighbor sued the family, individual board members, and the HOA for breaching its fiduciary duties by granting an accommodation in conflict with the HOA’s rules against backyard fences.

In each of the next two years, the family submitted annual documentation of the daughter’s continuing disability—letters from her pediatrician attesting to the girl’s developmental delays, which caused great difficulty in reasoning (making her unable to recognize dangers), and poor motor control, which made it more difficult to avoid dangers. In both letters, the doctor said the girl continued to need a safe environment; the second letter specifically referenced the need for a fence as a barrier to the lake.

After a hearing, the court granted judgment to the HOA and other defendants, ruling that the board did not breach its fiduciary duty by granting the family’s reasonable accommodation to build the fence.

DECISION: Affirmed.

REASONING: The HOA didn’t violate its fiduciary duty under state law by granting the family’s request for an exception to its rules against fencing to accommodate the daughter’s disability.

The court rejected the neighbor’s claims that the board violated its own rules because it failed to notify her before granting the family’s request. Neither the HOA’s own rules nor fair housing law required the HOA to inform the family’s next-door neighbors that it was considering a request for a reasonable accommodation under fair housing law.

The court also rejected the neighbor’s claims that the board breached its fiduciary duties by failing to investigate possible alternatives to allowing the family to put up the fence. The HOA argued that it abided by the law, but the neighbor said it did nothing more than to accept the family’s claims at face value.

To meet its fiduciary duties to its members, the board was required, when considering the requested accommodation, to balance the interests of and benefits to the disabled individual against the interests of and burdens to the HOA. The board was under no affirmative duty to consider alternatives to the family’s request for a perimeter fence.

Undoubtedly, there might be alternatives more reasonable to the HOA (and more palatable to the family’s next-door neighbor). It was also possible that a family determined to protect its disabled child would cause the HOA great expense in defending its decision to deny the requested accommodation and enforce its rules against the fence.

In this case, the board considered the accommodation request in good faith and conditioned its approval to allow installation of a temporary perimeter fence, subject to conditions beneficial to the HOA. Contrary to the neighbor’s argument, the board didn’t simply accept the family’s demand.

The board didn’t violate its fiduciary obligations to its members by failing to enforce the community’s rules. In fact, the evidence showed that the board performed its duties in responding to a request for a reasonable accommodation under fair housing law in good faith, in a manner that it reasonably believed to be in the best interests of the community and with the care that an ordinary prudent person would use under similar circumstances.

• Ray v. Hidden Harbour Association, Ohio, January 2018

LEGAL UPDATE

Discrimination Based on Sexual Orientation and Gender Identity

In the May 2018 lesson—and a related webinar—the Coach discussed developing trends, including the potential expansion of the ban on sex discrimination to cover complaints based on sexual orientation and gender identity.

Federal fair housing law, like its counterpart banning employment discrimination, prohibit discrimination based on sex, but neither explicitly ban discrimination based on sexual orientation or gender identity. Until recently, the general belief was that the ban on sex discrimination didn’t cover claims based on sexual orientation, though it may cover claims for failure to conform to gender stereotypes. In recent rulings, however, several courts have recognized that the federal ban on sex discrimination in employment covers claims based on sexual orientation or transgender status.

COURT RULING: In April 2018, the federal court in Texas was the latest to continue the trend in a case involving a transgender woman who alleged that a prospective employer withdrew a job offer because of her transgender status. Persuaded by the recent cases recognizing that transgender status and sexual orientation were protected classes under the federal law banning employment discrimination based on sex, the court assumed that the applicant’s status as a transgender woman placed her under the law’s protection. Nevertheless, the court ruled in favor of the prospective employer based on evidence that her job offer was withdrawn not because of her transgender status, but because of discrepancies in her dates of employment. There was no evidence that her transgender status played any role in the decision to withdraw her offer [Wittmer v. Phillips 66 Co., Texas, April 2018.]

STATE LAW: Currently, 22 states and the District of Columbia have adopted fair housing protections based on sexual orientation; most, but not all, also cover gender identity, gender expression, or transgender status.

In Michigan, the state’s antidiscrimination law, the Elliott-Larsen Civil Rights Act, prohibits discrimination in employment, housing, and public accommodations on the basis of sex, but it doesn’t specifically ban discrimination based on gender identity and sexual orientation.

Efforts to change the law have been unsuccessful, but the Michigan Civil Rights Commission recently announced that it will begin processing complaints of sex discrimination based on sexual orientation and gender identity.

The change comes at the request of Equality Michigan, which last year asked the commission to issue guidance on the meaning of “sex” under the state antidiscrimination law. The commission previous tabled the issue, but in May 2018, the commission voted to issue an interpretive statement clarifying that discrimination on the basis of sex includes protection against discrimination on the basis of gender identity and sexual orientation.

“I commend the commission for the courage they’ve shown in making this decision,” Agustin V. Arbulu, Director of the Michigan Department of Civil Rights, said in a statement. “Beginning tomorrow morning, the department will begin processing complaints of sex discrimination based on sexual orientation and gender identity.”

NEWS NOTES

Oklahoma Landlords Agree to Pay $800,000 to Resolve Sexual Harassment Claims

A husband and wife, and their various business entities, recently agreed to pay $800,000 to resolve a fair housing case alleging a pattern or practice of sexual harassment of female residents of residential dwellings they owned or managed in Oklahoma City and the surrounding area.

The complaint alleged that since at least 2008, the husband discriminated against female residents on the basis of sex by subjecting them to severe, pervasive, and unwelcome sexual harassment, including making unwelcome sexual comments and unwelcome sexual advances; subjecting them to unwanted sexual touching; conditioning or offering tangible housing benefits—such as rent forgiveness, late fee withdrawal, dismissal of evictions, payment of utilities, or access to housing—in exchange for sexual acts by female residents; entering the dwellings of female residents without notice or permission; taking adverse housing actions, or threatening to take such actions, against female residents who refused, or refused to continue, to grant sexual favors; and seizing the personal property of female residents and their children in retaliation for their failure or refusal to provide sexual favors. The defendants denied the allegations.

In agreeing to the settlement, the defendants made no admission of liability or wrongdoing in connection with the allegations and claims made by the plaintiffs. In addition to the monetary payment, the settlement also requires the husband to cease activities that would bring him in contact with applicants or residents of rental property owned, managed, operated, or controlled by any defendant.

Community Accused of Displaying Nazi Flags in Building Lobby

The New York City Commission on Human Rights recently announced a settlement with a Queens condo community, following an investigation into reports of resident harassment, discrimination, and a hostile environment, including displays of Nazi and Confederate imagery, swastikas, and hate symbols in the lobby.

The investigation stemmed from reports that a board member was harassing residents based on their immigration status, national origin, and race and creating a hostile environment, including the posting of notices, photos, and slogans in the common area of the building to demean, intimidate, and harass tenants. One resident said that the board member stopped her as she was walking to her unit with her boyfriend, who was of Puerto-Rican descent, demanding to see his passport and exclaiming that he “could be anyone illegal.” Another unit owner said that the board member left her a voicemail claiming to be Adolf Hitler and stating that “the grandmaster of the KKK is coming to the lobby”; she said that he also responded to her attempt to rent her unit to a Latina woman by declaring, “She’s Spanish. They are low lives and don’t pay the rent.”

According to the commission, its investigation allegedly uncovered other violations of the city’s human rights law in the community’s “House Rules,” including a provision requiring unit owners to provide the board with the U.S. passports or residency cards of any tenant living in the unit as well as a blanket “no pets” policy that didn’t mention accommodations for residents with disabilities.

Among other things, the settlement requires the resignation of the board member and two others from the board and the removal of all offensive posters, symbols, and materials from the lobby. The community was also required to amend its house rules to remove the requirement that tenants prove their immigration status and to change the “no pets” policy to include language about accommodating tenants with disabilities. The settlement resolves only the commission’s claims; aggrieved residents and condo owners may still file their own fair housing complaints.

“We hope this settlement sends a strong message to housing providers citywide that New York City does not tolerate discrimination or harassment and that we will not hesitate to take immediate action when we learn of violations,” Sapna V. Raj, Assistant Commissioner for the Law Enforcement Bureau at the NYC Commission on Human Rights, said in a statement. “Housing providers, including condo boards, supers, landlords, and brokers, have a legal obligation to follow the NYC Human Rights Law, which prohibits discrimination and harassment based on national origin, immigration status, race, or any other protected category.”

Community Pays $27,500 Settlement to Resolve Fair Housing Claims

The owner and the property manager of a six-unit California community recently agreed to pay $27,500 to resolve a complaint alleging housing discrimination based on national origin, familial status, and disability.

The complaint was filed on behalf of an Hispanic couple and their minor son, who allegedly moved into their second-floor unit in 2011. At that time, they said that one unit was occupied by an Hispanic couple with two minor children; the others were occupied by non-Hispanic, Caucasian individuals.

Soon after moving in, they said they complained that mold in the unit was causing breathing problems for the wife and son, but that nothing was done about the problem until late 2015, when the husband got permission to replace the carpeting with laminate flooring. Soon after, the manager allegedly raised concerns about noise after the new neighbor downstairs complained the son was running around the apartment late at night.

By early 2016, the community allegedly terminated the tenancies of both Hispanic families. The couple said they offered to move downstairs, but the owner denied their request. Allegedly, the owner told the husband that she no longer wanted to rent any apartments to families with children.

The owner filed an eviction action against them and the other Latino family. Attached was a copy of the House Rules and Regulations, which allegedly limited the ability of children to play, or to use or store toys, on the property. 

After the family moved out, fair housing advocates filed a fair housing complaint, claiming that its investigation revealed discrimination in the way that prospects were treated based on their national origin. During an initial round of calls, the manager allegedly told a Latino investigator to call back about an expected vacancy, but provided more detailed information to a non-Latino Caucasian investigator. When the testers called back, the manager allegedly told the Latino investigator that there was no availability, but told the non-Latino Caucasian investigator about two expected vacancies and later showed him the property.

In addition to the monetary payment, the settlement requires fair housing training and significant policy changes, including removal of any discriminatory language regarding children, from leases and accompanying documents.

Community to Pay $12K to Settle Dispute over Rules Affecting Children’s Playtime Activities

In March 2018, a court approved a settlement requiring a California community to pay $3,000 to each of a former resident’s four children to resolve allegations that it enforced rules that unfairly targeted children and discriminated against families with children. The complaint alleged that the rules prevented children from playing in common areas. After reviewing comparable settlements approved in cases involving similar allegations, the court ruled that the amounts provided to the minor children were fair and reasonable [Faustino v. Central SDHC FHA LLC, California, March 2018].

• Fair Housing Act: 42 USC §3601 et seq.