Armendariz v. Penman (9th Circuit)

An equal protection claim could be established for enforcement of housing and fire codes in an arbitrary and invidiously discriminatory manner.

http://caselaw.lp.findlaw.com/scripts/getcase.pl?navby=search&case=/data2/circs/9th/9355393.html

DOJ v. Addison IL

The Department’s July,1995 suit alleged that the village had violated the federal Fair Housing Act by illegally tearing down Hispanic neighborhoods as part of an urban renewal program.

http://www.justice.gov/opa/pr/1997/August97/327cr.htm

HUD v Elgin IL

The City of Elgin, Illinois has agreed to pay $500,000 to settle longstanding complaints that its enforcement of housing codes discriminated against Latino residents.The settlement with the U.S. Department of Housing and Urban Development (HUD), Department of Justice and the HOPE Fair Housing Center of Wheaton, Illinois includes a fund to compensate the victims of code enforcement discrimination.

http://www.fairhousing.com/include/media/pdf/sept2002.pdf (at page 3)

http://fairhousing.com/index.cfm?method=page.display&pagename=advocate_sept02_page4

DOJ v. Fairview IL

http://www.justice.gov/crt/housing/documents/fairviewsettle.php

Metropolitan St. Louis Equal Housing Opportunity Council on discriminatory code enforcement:

“The target in Belleville is obviously lower income residents and naturally blacks within the community. Another major cause for concern about Belleville’s occupancy practices is that these other cities are now watching to see how the Federal and State officials respond to Belleville. Without a federal or state response I’m afraid that Southern Illinois will become like Montgomery Alabama in 1955 if it isn’t already? The U.S. Department of Justice is well aware of what has been going on in Belleville and has been for sometime. We at EHOC have found that often people have been afraid of coming forward with complaints until their struggle is recognized by some form of credible authority.”

http://fairhousing.com/index.cfm?method=page.display&pagename=releases_ehoc12-13-02
http://www.citizenreviewonline.org/Dec_2002/subject.htm

(There was a DOJ case, but I can’t find it)

DOJ v. Waukegan, IL

The city of Waukegan, Illinois, whose officials were accused of violating the Fair Housing Act by enacting a housing code to limit the number of Hispanic family members living together, has agreed to pay $200,000 in damages and fines under an agreement reached with the Justice Department.

City officials said they intended to prevent Hispanics from “taking over” Waukegan

http://fairhousing.com/index.cfm?method=page.display&pageID=3167

HOPE Fair Housing Center settles case against West Chicago

http://fairhousing.com/index.cfm?method=page.display&pageID=3474

Property owners and tenants v. Georgetown DE

(Summary Decision allowing case to proceed)

Plaintiffs also allege that defendants have developed a pattern and practice of discriminatory housing code enforcement, by targeting Hispanic units while ignoring and not inspecting units occupied by non-Hispanics

http://www.ded.uscourts.gov/SLR/Opinions/Sep2002/01-881.pdf

I’m sure I am missing many.  Please add your favorite cases to the comments section or email them to me.

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Federal Court of Appeals ruled today that the combined cases of  Gallagher, Steinhauser,Harrilal (rental property owners) vs St. Paul will go to trial.

This is a very important case on code enforcement being used in a discriminatory manner.  Continue on to read the highlights with inks to the most recent decision.

This case alleges that St Paul housing inspection programs were used in a racially motivated manner to force racial minorities out of St Paul and that such actions violated the Fair Housing rights of the occupants.

A very interesting point is a number of city employees including inspectors are on the hook personally in this suit.  From a legal perspective each city employee must defend themselves as they, their co-workers and their employer have disparate interest.

For the city to win if the allegations are proven true they must claim rouge employees were acting outside of the law and contrary to department policy. For the inspectors to win they must argue that they were following instructions from their supervisors that they believed were legal.

At some point the inspectors will have to name their union as third party defendants as the union failed to stop management from allowing/forcing them to violate the rights of the tenants and owners

The inspectors may have a hard time claiming ignorance however as the owners had provided the inspectors with documentation that the inspectors’ acts were contrary to Fair Housing, yet the inspectors continued with their agenda.

From my conversations with two of the plaintiffs over the past five or six years they seem to be just a handful of hard working landlords who independently found themselves on the losing end of government behaving badly.  The current case is a consolidation of three or four cases that started independent of each other, but the claims were so similar that the federal court combined them.  Most of the cases claimed RICO (racketeering) on the part of the city employees.

Much of this is so similar to what we are seeing in Milwaukee.

Note the vacant building ordinance for example.  Our former Commissioner of Neighborhood Services had a number of conversations with his counterparts in MN, and proposed a number of ordinances that were based on what was on the books there.

Here is an except from today’s ruling

To demonstrate a disparate impact, Appellants have offered evidence supporting the following conclusions:

(a) The City experienced a shortage of affordable housing.  The City represented in its 2003 report to the U.S. Department of Housing and Urban Development (“HUD”) that “the lack of affordable housing opportunities remains a major issue facing many Saint Paul lower income households, who are also protected class members,” and that “27.6% of Saint Paul’s lower income residents cannot find adequate affordable housing in the City.”  Then, in 2005, the City estimated that 32% of the households in St. Paul had unmet housing needs (cost burdens, overcrowding, etc.).

(b) Racial minorities, especially African-Americans, made up a disproportionate percentage of lower-income households in the City that rely on low-income housing.  The district court noted that the parties agree that African-Americans make up a disproportionate percentage of low-income tenants in the City.  The City’s 2000 census data showed that 11.7% of the City’s population was African-American, whereas data from October 2004 showed that 61% and 62% of those on waiting lists for public housing and Section 8 assistance, respectively, were African- American.  Further, the City’s 2000 report to HUD showed that 52% of minority-headed renter households were in the bottom bracket for household adjusted median family income, compared to 32% of all renter households.

(c) The City’s aggressive Housing Code enforcement practices increased costs for property owners that rent to low-income tenants.  Appellants produced at least six affidavits describing the toll that the City’s aggressive Housing Code enforcement took on their rental business. They reported a substantial increase in costs, resulting in evictions for tenants and “forced sales” of their properties in some cases.  These allegations are corroborated by an internal memorandum from the City’s fire marshal in 1995, comparing the Housing Code and the HQS and concluding that the Housing Code was more strict in regard to 82% of the examined categories.

(d) The increased burden on rental-property owners from aggressive code enforcement resulted in less affordable housing in the City.  Documents from the City and the Public Housing Authority acknowledged that any decrease in federally assisted rental housing would reduce the amount of affordable housing in the City.  Those predictions were supported by the City’s Vacant Buildings Report, which showed that the number of vacant homes listed in the City rose from 367 to 1,466 between March 2003 and November 2007, which was a nearly 300% increase.  Further, Appellants submitted affidavits from three tenants who alleged that they endured hardship when their homes were condemned for minimal or false Housing Code violations.

These premises, together, reasonably demonstrate that the City’s aggressive enforcement of the Housing Code resulted in a disproportionate adverse effect on racial minorities, particularly African-Americans.  Viewed in the light most favorable to Appellants, the evidence shows that the City’s Housing Code enforcement temporarily, if not permanently, burdened Appellants’ rental businesses, which indirectly burdened their tenants.

Read the entire decision here.  I have a fairly complete set of pleadings if anyone wishes to study this more.

A lively discussion of the case on Ademocracy

I and others were crying tears of joy when we heard this news. It has been a long emotional ordeal for many of us.

There isn’t a jury in the entire world who could listen to this story and not favor the plaintiffs!

ABC News  -Landlord Suit Could Cost City Millions

A legal battle between the City of Saint Paul and a handful of landlords could force the city to pay millions.

It all centers around code enforcement.

Pioneer Press on the lawsuit.

A set of lawsuits alleging St. Paul’s housing-code enforcement discriminated against black tenants was given new life Wednesday when a federal appeals panel reinstated a portion of the case.

The allegations “reasonably demonstrate that the city’s aggressive enforcement of the housing code resulted in a disproportionate adverse effect on racial minorities, particularly African-Americans,” a three-judge panel for the 8th Circuit Court of Appeals wrote in overturning part of a 2008 dismissal of the case by U.S. District Judge Joan Ericksen.

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Here is Tristan’s letter describing the event.

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The Housing Authority denied an application because the prospective tenant had been found guilty in a default judgment on municipal citations for disorderly conduct, and assault and battery

Read the case here

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Here are seven dirty words you can’t say in real-estate ads: exclusive, quiet, private, bachelor, kids, walking and playroom.

Yet HUD’s Fair Housing enforcement guidelines appear to be more reasonable and contradict this article.

Use of the term master bedroom does not constitute a violation of either the sex discrimination provisions or the race discrimination provisions. Terms such as ”mother-in-law suite” and ”bachelor apartment” are commonly used as physical descriptions of housing units and do not violate the Act

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All states and many municipalities have their own protected classes in addition to the federal protections.   These protections are:

Note: if you are outside of Milwaukee, Dane County or City of Madison, there still may be local ordinances that affect you, but are not listed here.  If you are aware of a local ordinance please post a link  in the comments section below

Federal Fair Housing Protected Classes (Link to Federal Classes)

• Race Color
• Family Status
• Disability
• Sex
• Religion

Wisconsin Fair Housing Protected Classes (Link to §106.50)

• Race
• Family Status
• Sexual Orientation
• Source of Income
• Disability
• Ancestry
• Sex
• Marital Status
• Religion
• National Origin
• Color
• Age

City of Milwaukee Fair Housing Protected Classes(Link to Ch. 109)

• sex
• race
• religion
• color,
• national origin or ancestry
• age
• disability
• lawful
• source of income
• marital status
• sexual orientation
• gender identity or expression,
• past or present membership in the military service,
• familial status,

Madison and Dane County Addition to State and Federal Classes (Link)

• type of military discharge
• arrest or conviction record (limited protections)
• physical appearance
• political beliefs
• student status
• victims of domestic abuse or other crimes (limited protections)
• refusal to disclose Social Security Number (City of Madison only).

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Fair housing is a complex set of laws.  Even if you absolutely follow the rules and their intentions you can find yourself “defending your life” so to speak.  Better the records and documentation, the better you will be able to ward off false allegations.

Here is our personal experience with HUD Fair Housing:

In December 2007 an applicant from NYC applied to rent from us. Her most  recent employment was with a NYC temp agency. Although she put on the application that she was moving to Milwaukee to seek work, she  had no proof of a job offer.  We also had no means of verifying her  prior rental history or checking for NY evictions.

If she could not prove she had the resources to pay the rent it probably would not work out.  We told her we could accept her only if she could provide an acceptable cosigner.  She came in with a cosigner from Chicago, which  was not acceptable as it is pretty hard to collect a judgment  from an out of  state person in WI courts. So she was rejected.

Fast forward a couple of months. We receive a certified letter from HUD. The rejected prospective tenant from NY was alleging that  we denied her due to her being Hispanic.

Well this would be an easy one, I mistakenly thought.

The office manager who rejected the application was born in PR.  45% of our  tenants are Hispanic.  61% of our employees were Hispanic.  My wife is Hispanic. Her  parents were living in Vega Bajo, PR at the time of the complaint. Our company has donated to the Latino Community Center and has been one of the sponsors of Milwaukee’s Fiesta Boricua.

Our reasons for rejection were legitamate and followed our written criteria: 1) No verifiable current source of income; 2) No verifiable recent rental history.

So at that point I’m not real concerned of the complaint going anywhere.  It was a slight nuisance to spend an hour or so reviewing the file  and drafting a response. But I am comfortable that our process would withstand the scrutiny of HUD or anyone else, even absent a Hispanic  staff and wife. We had a written application with her hand written responses that did not include any WI income sources. We also have  the cosigners application that clearly shows he did not live in WI.  Plus we provide our screening criteria to prospective tenants as an attachment to our applications.

Once the investigator looks over our documentation supporting our reason for rejecting the applicantion the complaint will be dismissed, I mistakenly thought.

We were able to prove to the satisfaction of the federal investigator that indeed 45% of our tenants are Hispanic as is 61% of our workforce, including the employee who rejected the app for lack of verifiable income.

The woman amended her complaint saying that we discriminated against her as a single mother.  Well we have lots of single mom tenants, which we were again able to prove.

End of story right? Wrong!

No, the complaint was then amended that she is a Hispanic single mom with two kids and “everybody knows Hispanics think Hispanic single moms are bad risks”  (her statement, not ours.  In fact the woman who ran the application was a Hispanic single mom) So now we had to show all the screening we’ve done exclusively on Hispanic single moms.

We mailed 220 pages of application copies, spent hours pulling old records and doing phone interviews with the investigator.  He was at our office half a day looking at applications and tenant records as well as interviewing employees.  That we have our tenant docs scanned and digitalized really made this a lot more manageable.

As the investigator looked at each app he questioned things like ‘Why did you run a credit report on this one, but not that one.’ Well the latter had 5 evictions on CCAP so we didn’t need the credit report to see they were an unacceptable risk.   ’Why did you print out this CCAP case for your file, but not that case.’  Well the first case was an eviction, so we wanted it for our records.  The second case was a speeding ticket, which we really didn’t care about as we are renting houses not fast cars.

A constant theme throughout this was the investigator saying ‘I’d like to call you tomorrow with a settlement offer so we won’t need to go through this any more’ to which we constantly replied ‘We do not illegally discriminate, we have good records and therefore are not interested in any settlement offer.’  My position is I will spend twenty grand on attorneys  before I will allow us to be extorted out of $10 and have a discrimination blemish on our record.

Every app we have run is well documented, but a fair housing complaint was still troublesome.

After this experience I would not sleep at night if we were like so many other owners who rely on telephone prescreening or anything else that is not written, photocopied etc.  If you didn’t like the tenant’s income how would you prove how much  it was at the time if you didn’t have a photocopy of a pay stub or award letter?  If you didn’t copy the ID how do you prove you screened the right person.  He said Sam Johnson, you screened Sam Johnson and found a lot of bad stuff. When the fair housing complaint comes in from Sam Johnston (note the “t”) with a rental history as pure as the driven snow how do you prove yourself?

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