Fair Housing Complaints, Investigations, and the Enforcement Process

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By: Robert ("Robin") Hein, Esq.

Which Agencies Process a Fair Housing Complaint.  The fair housing complaint, investigation, and enforcement process is somewhat complex because there are so many public and private components.  There are two basic kinds of civil housing discrimination claims.  Both often are loosely referred to as "complaints" but actually are very different.

One is called an "administrative agency complaint" that primarily involves the processing and investigation of an alleged discrimination claim by a federal or state enforcement agency, such as the U.S. Department of Housing and Urban Development (HUD) or the Florida Commission on Human Relationships (FCHR).

In Florida, there are a number of cities and counties which have their own local enforcement agencies and also process such claims.   These cities and counties also have adopted their own local fair housing laws that sometimes include more protected categories than the seven protected federal and state groups (race, color, religions, sex, national origin, familial status, and disability).  They are Hillsborough, Palm Beach, and Pinellas Counties and the cities of Jacksonville, Orlando, St. Petersburg, and Tampa.

Administrative agency actions could be investigated by HUD (a federal agency), the FCHR (a state agency), and, at the city or county level if the local government has an agency capable of handling the complaint and investigation.

The "administrative agency complaint" is the most common kind of fair housing complaint confronted by apartment management.  It is basically the preliminary or first stage of most fair housing complaints and focuses mainly on investigation.  However, another very important kind of housing discrimination claim or "complaint" is the traditional lawsuit or civil action which is filed and proceeds through the court system. 

How the Complaint Process Works.

The Administrative Complaint and Agency Investigation.  The procedures involved in defending or responding to these two different kinds of discrimination claims (administrative vs. civil action) are very different.

Processing the administrative agency complaint focuses more on investigation and results in an agency finding or determination and report with regard to whether the agency has reason to suspect discrimination may have occurred.  The investigative agency finding is not the final step in determining whether discrimination occurred.  Further prosecution of the claim in a state or federal trial court or in a federal or state administrative court is necessary to establish whether discrimination occurred.  Further prosecution of a fair housing violation could take place before an administrative law judge or in the federal and state trial court systems. 

The Civil Action or Lawsuit. Traditional lawsuits must follow the federal or state rules of civil procedure and rules of court that govern formal legal actions and require legal counsel experienced with litigation.  Administrative proceedings must follow the federal or state rules for administrative proceedings and do not provide for jury trials.  A federal or state lawsuit or an administrative trial results in a binding judicial decision.  Criminal actions or complaints may be filed for certain kinds of serious violations.  So, what is often the "second stage" after an investigation or the final resolution of any fair housing claim could take place at either the federal or state level or in a regular or administrative court.  It also is possible that the unhappy applicant or resident may never proceed with the claim after going through the preliminary agency investigation.

A federal civil lawsuit alleging housing discrimination also could be filed in one of the U.S. District Courts in Florida, Georgia, or other states. Likewise, in Florida a suit could be pursued in one of the county Circuit Courts.  While the fair housing laws under Title VIII of the Civil Rights Act are very similar to employment discrimination laws of Title VII, the fair housing claim does not have to start with HUD or the FCHR before a lawsuit can be filed in court.  [Employment discrimination claims must first be filed with the U.S. Equal Employment Opportunity Commission (EEOC) within 180 days of the alleged act of employment discrimination and be processed by the EEOC before an employment discrimination civil lawsuit can be filed in a federal or state trial court.]

Both kinds of administrative and civil lawsuit discrimination complaints in Florida, Georgia, and other states can be filed and pursued at the federal or state level.

The Complaining Party Can Bypass the Administrative Complaint and Go Directly to a Civil Lawsuit.  The applicant or resident (or HUD, U.S Department of Justice, GCEO, and State Attorney General) could bypass filing an administrative complaint and go directly to a lawsuit in federal or state trial court by filing a civil action.  The Fair Housing Act does not require the complaining party to first file with HUD or the GCEO.  This is a different procedure from employment claims which must first be filed with the EEOC.  The failure to file a timely EEOC complaint within six months (180 days) of the alleged discrimination means that the employment discrimination claim is barred from further prosecution.  Employment discrimination claims are discussed in Chapter 16. 

Who Can Pursue a Fair Housing Complaint.  There are three categories of persons or organizations which might pursue a housing discrimination claim or complaint.  First, and most often, an individual (such as an apartment visitor, applicant, or resident) may claim to have experienced a discriminatory act that violates his or her civil rights.  Such persons are referred to as the "aggrieved party" under the Fair Housing Act (FHA).  Second, private non-profit housing rights advocacy groups may file claims on behalf of an individual.  These advocacy groups often claim standing (the ability to file lawsuits) to pursue claims based on expending their own monies or resources to investigate claims of discrimination on behalf of an individual.  Third, governmental agencies or departments such as HUD and the U.S. Department of Justice or the GCEO and Georgia Attorney General’s Office can initiate or join in prosecutions of FHA claims.

A private non-profit housing organization which might be involved in filing a complaint with HUD, a state agency, or a local municipal government is an organization sometimes referred to as a "private advocacy group."  These private nonprofits do not have governmental authority or jurisdiction to process and investigate complaints but may assist a resident or other complaining party in filing their complaint.

For example, in Washington, DC, one well known group is the Equal Rights Center (ERC).  Such nonprofit private groups submit funding requests to HUD and are eligible to receive grants under the federal FHIP.  These private advocacy groups then may use some of those funds to provide "testers" and prosecute housing violations.  They also are eligible to seek compensation as plaintiffs in lawsuits prosecuting alleged housing discrimination. These groups also may initiate filing their own fair housing complaint independent of an individual or governmental agency.

FHA Claims – The Reality.  Even the best efforts to prevent housing discrimination claims cannot always prevent a complaint being filed.  Despite extensive education and training, despite good operational policies and procedures, and notwithstanding attempts to design and construct disability-accessible housing, apartment owners and management still may face either an administrative claim (investigation) or a lawsuit that alleges some kind of housing discrimination.  One reality of apartment management is that fair housing claims are possibly the most frequent retaliatory vehicle used by unhappy visitors, applicants, or residents who believe they were treated unfairly by corporate or on-site management of an apartment community.  Once a claim is filed, the agency or court system must follow the rules and go through the investigation or court procedures for determining whether a violation occurred.

Filing an Administrative Agency Complaint.  In most instances, an individual who believes that he or she was a victim of discrimination (an "aggrieved party") can start the investigative process by filing an administrative agency complaint with HUD or the FCHR not later than one year after the alleged "discriminatory housing practice."

The administrative complaint is a one- or two-page form which states the names of the persons and apartments or owners alleged to have violated the law; the type of discrimination alleged (race, color, religion, etc.); and a short summary statement of the facts, dates involved, and description of the alleged discriminatory practice.  For example, the complaint may allege:

             "Complainant, who is disabled, requested reasonable

modifications to the interior of her apartment such that

 her wheelchair could maneuver about the space. 

 Complainant requested the modifications at the time of

 applying for occupancy on June 20, 1998, and agreed

 to pay the reasonable costs of making such changes.

 The Respondent (owner or management company)

 refused to permit the changes in violation of 42 USC

 §3604(f)(3)(A) of the ‘Fair Housing Amendments Act of

 1988,’ which requires that the owner and management

 permit reasonable modifications of the apartment if

 necessary to afford the resident full enjoyment of the

 premises."  [The term "complainant" also means

 "aggrieved party."]

Retaliation Claims Are Separate Violations. The FHA prohibits any kind of "retaliation" against the resident, management employees, or other persons who might be involved in filing or investigating the complaint.  If a resident, visitor, or applicant has threatened or filed a fair housing complaint, care should be taken to avoid any adverse action which could be seen as retaliatory.   A housing discrimination retaliation claim is a separate offense that may be prosecuted even if the investigation or lawsuit establishes there was no discrimination.

Processing the Complaint.  After its filing, the HUD or FCHR administrative complaint is delivered to the apartment community, corporate office or management employee by certified mail within 10 days.  The owner, manager, or employee (referred to as "respondents") may file an answer to an administrative complaint with HUD or FCHR within 10 days after receiving the complaint.  Even though the administrative complaint cannot go into default for failure to answer, the Fair Housing Act requires apartment owners and managers to cooperate in responding to investigative inquiries by HUD and the FCHR.  Care should be taken to respond properly with assistance of legal counsel to any administrative action in order to avoid making admissions or inappropriate comments.

All administrative complaints and civil actions should be forwarded immediately to a supervisor and risk management for evaluation and submission to any insurance carriers who may provide coverage.  Risk management or the management’s corporate office should immediately notify both the management’s and the property owner’s commercial general liability, employment practices liability, and errors and omissions insurance carriers in writing of the claim for all policy years that might be affected.  Management should retain legal counsel experienced with fair housing claims for filing a response to either the administrative complaint or civil action. 

Administrative complaints from HUD or the FCHR should be answered within 10 days.

Individual Liability.  Do not be surprised to learn that the complaint names the property supervisor, community manager, assistant manager, or leasing consultant as a respondent or party who can have individual personal liability for the alleged discrimination.  On-site and corporate employees can have individual liability for fair housing violations.

The Investigation.  HUD or the FCHR is supposed to complete its investigation within 100 days of the date the complaint was filed; however, the time can be (and usually is) extended as needed.  Both HUD and the FCHR will try to minimize disruption of management business while conducting the investigation, but it is inevitable that management will need time assembling and reviewing documents, meeting with legal counsel, and providing witness interviews. 

Federal and state fair housing laws encourage voluntary cooperation by the owner and management in making files and records available, providing interviews with management employees, and allowing on-site inspections of the property to investigators.  The kinds of documents and information HUD or the GCEO request will vary depending on the nature of the alleged violation.  Governmental agencies can initiate a contempt action for failure to respond to a subpoena.

Discovery or Requests for Information from HUD and the GCEO.  Informal requests for information and documents from HUD or the GCEO to the owner or manager usually accompany a copy of the administrative complaint or may be sent soon thereafter.  More formal requests also are used, such as requests for documents, depositions, and requests for physical inspection of the property.  In addition to interviewing the on-site staff, the investigators or compliance officers might interview prospects, applicants, and other residents in the community to take written or recorded statements and verify whether discrimination may have occurred.  Interviews of other residents can produce great anxiety and raises difficult issues of how to disclose that an investigation is on-going and why an investigator is asking questions about discrimination.  The private, nonprofit civil rights advocacy groups do not have any of the enforcement agency powers granted to HUD and the GCEO to process administrative fair housing complaints, issue subpoenas and discovery requests, or conduct official interviews.

Documents and Information Sought During the Investigation.  In almost all cases, management will be requested to identify the owner of the property, other properties owned or managed, and those employees with knowledge of the events which took place. 

If the allegations involve design and construction requirements for disabled accessibility, the apartment owner will be requested to identify the architects, engineers, contractors and subcontractors who built or developed the property.  Investigators will ask for copies of building permits, certificates of occupancy, and construction plans showing specifications.  The owner or manager may have to arrange for or cooperate with an on-site inspection of each floor plan for that community.  Inspection of the property also will include the leasing, management, and business offices, and amenities such as the swimming pool, tennis courts, picnic areas, mail centers, and other common areas.  The investigators will take measurements of door widths and thresholds, reaching distances for thermostats and light switches, and maneuvering spaces in the kitchens and bathrooms.

If the allegations of discrimination center on refusing to disclose or show available apartments or steering prospects because of race, family status or disability, then HUD or the GCEO will request copies of prospect or visitor cards and photo identifications (if management keeps or maintains such records), rental applications, and statistical information, such as management’s best guess about who lives on the property (demographic percentages by race, families with children under 18, or persons with disabilities), and rental applications.  Providing demographic statistical information seems to be a puzzling aspect of investigations to many owners and managers because such information is not usually kept (unless required under a federal or state program) and could be considered circumstantial evidence of discrimination

If the allegations concern discrimination involving eviction, non-renewal, or termination of a resident’s lease, investigators will seek files of other residents who were given similar notices to determine if they were treated any differently from the person filing the fair housing complaint.  The investigator will examine these "comparative files" for late notices, correspondence, maintenance requests logs, work orders, leases, and addenda.  The investigators are looking for patterns of discrimination or unexplained differences of treatment based on a prohibited basis.  Management will be asked to explain the reasons for evicting or terminating the rental agreement and must be prepared to give objective and nondiscriminatory reasons for the actions taken.

Management will be asked to provide copies of its operational policies and procedures, rental qualification criteria, statements of rental policy, availability lists, rent rolls with names and addresses of all residents on the property, and many other documents.

Conciliation.  By law, HUD and the FCHR are required to attempt "conciliation" of the claim by bringing the parties together for a mediation conference to reach a compromise.  In the conciliation conference each party is given an opportunity to present its side of the case.  A representative of HUD or the GCEO acts as a mediator, attempting to resolve the claims involved in the case.  Most complaining parties usually have a dollar amount in mind in order to settle the claim.  (The parties are not required to conciliate or settle, but such mediation can be successful if the demands of the complainant are reasonable and the apartment owner or manager is willing to settle under a stipulation that does not admit a violation occurred.  Unfortunately, this kind of mediation often is not successful.)  Nothing that is said or done in the course of conciliation may be made public or used as evidence without the written consent of the parties.

If the parties are able to reach a settlement, the mediator or investigator will draft a proposed settlement agreement for signature.  The conciliation agreement can provide for binding arbitration.  The agreement must be approved by HUD or the FCHR and will be made public unless both parties agree to keep it private.  Conciliation is not binding or mandatory and is considered to be non-adversarial.  If the parties cannot reach an agreement, then the investigation continues. 

Completion of the Investigation.  Once the investigation is complete, a final investigative report is issued by the Assistant Secretary of HUD or by the Administrator of the FCHR state enforcement agency.  The report will not contain the names of witnesses if they request anonymity.  The report will contain a summary of the dates of correspondence, records, witness statements, and answers to interrogatories.  General Counsel for HUD then will determine from all the circumstances whether "reasonable cause exists to believe that a discriminatory housing practice has occurred."  HUD’s General Counsel also will determine whether the facts are sufficient to begin a civil action in federal court.  A similar determination also is made in a FCHR investigation.

Final Investigative Report.  Filing a fair housing complaint with HUD or the FCHR only starts an investigation process.  The end result of the investigation is a determination of whether HUD or the FCHR finds sufficient evidence to believe housing discrimination may have occurred.  At the conclusion of the investigation, HUD or the FCHR will issue a "final investigative report" summarizing the facts and recommending whether to issue a "charge" or to dismiss the case. If there is no reason to believe that discrimination occurred, the complaint will be dismissed.  If there is some evidence that discriminatory housing practices occurred, a "charge" will be issued.  A charge is sometimes called a "cause finding."  Even if a charge is issued at the end of the investigation of an administrative complaint, either an administrative hearing or civil trial is still required in order to  become a binding determination as to whether discrimination actually occurred.  A dismissal or issuance of a charge does not end the process, as the "complainant" or "aggrieved party" still has the right to file a lawsuit or request an administrative hearing before an administrative judge for a final judicial determination.

Issuance of a Charge or Dismissal.  If there is reason to believe that a discriminatory housing practice occurred (sometimes referred to as a "cause finding"), a "charge" is issued (called a "Charge of Discrimination").  HUD or the state agency will state the facts upon which the decision is based.  If no reasonable cause is found for a violation, the complaint will be dismissed (called a "Determination of No Reasonable Cause").  The dismissal does not completely end the matter since the complaining party still could file a civil action or lawsuit in the state or federal court system or pursue an administrative hearing under federal or state law.  Issuance of a charge is not a conclusive and binding judicial finding of discrimination.  The owner or manager is not "guilty" of a discriminatory housing practice simply because a charge was issued; however, the charge could be admissible in evidence at a later jury trial or administrative hearing.  There still must be a judicial hearing or trial to determine whether discrimination occurred and any civil liability for damages or other relief.  Management will have an opportunity to present its side of the case to a judge, jury, panel, or hearing officer to determine whether discrimination did in fact occur.

Do Not Give False Reasons for Non-Renewal of Leases. Management will have to explain to a fair housing investigator why it chose to make the resident leave the property.  Management must be able to explain to a fair housing investigator and document good "legitimate, non-discriminatory" business reasons for the non-renewal.  Acceptable reasons include repeated complaints from other residents about domestic fights disrupting their quiet enjoyment of the premises, vandalism and destruction of community property by the resident’s children, threats of violence, abuse, harassment, or criminal activity. 

Caution: When issuing lease termination or non-renewal notices, management should never give a false or "made-up" reason for its actions (to avoid saying why the resident was being asked to leave).  A false reason for the lease termination or non-renewal could cause the investigator or jury to infer that the "real" reason for the termination or non-renewal was illegal and discriminatory.  So, even if the real reason for the non-renewal or lease termination were legitimate and non-discriminatory, management could be faced with just the opposite conclusion.  Non-renewal notices do not have to state a reason for the non-renewal, but management must be prepared to explain a legitimate, non-discriminatory reason for its action. 

Investigators Look for Instances of Inconsistent Treatment.  The investigation will seek out any instances in which management treated the prospect, applicant, or resident differently from other prospects, applicants or residents who had the same or similar situations.  Treating someone who is not in the same category more favorably than the complaining resident could lead an investigator to conclude that management committed a discriminatory housing practice.  However, making exceptions to a procedural policy or procedure is not by itself discrimination.  Many times there are reasons why one applicant or resident received different treatment which was justified under particular circumstances.  This is why it is so important for management to be able to explain its actions.

Differences in Factual Circumstances.  Not all factual situations are identical.  Someone whose lease is terminated because of a noise violation could be treated very differently in terms of severity if the underlying facts showed that in one situation a gun was fired and in another there was an isolated instance of playing music loudly.  The fact that two similar situations involved families of different racial backgrounds and resulted in different management decisions does not by itself make the termination or non-renewal discriminatory.  In one instance the lease may be terminated for firing a gun, but in another, loud noise from a television may result only in a warning.

Fair Housing Training Is Important In Reducing Liability and Claims.  Fair housing training is necessary and effective in reducing claims of housing discrimination.  Adoption and implementation of good operational policies and procedures are also important.  Consistency and good documentation of resident files is a necessity. Even the best training and procedures will not eliminate all claims. But good procedures and education certainly can increase the odds that an apartment community will survive and defeat a fair housing complaint and investigation.  Understanding what happens once a claim is filed will help to ensure a successful resolution and defense of the complaint.

By Robert ("Robin") P. Hein, Esq. (Senior Counsel)

Fowler, Hein, Cheatwood & Williams, P.A.

2970 Clairmont Road, N.E., Suite 220

Atlanta, GA 30329-4414

(404) 633-5114

www.ApartmentLaw.com

Mr. Hein and Mike Williams, Esq. handle defense of fair housing administrative complaints throughout the Southeast and U.S. Their Atlanta based firm represents many of the largest owners and managers in the country.

*Robin Hein will be one of the workshop presenters at the upcoming FAA Education Conference and Trade Show.