$110,000 Penalty For Association’s “children” Rules: Doj Sues Condominium Association For Fair Housing Act Violations

In March 2015, a federal case brought by the U.S. Department of Justice (“DOJ”) against a Minnesota condominium association for engaging in housing practices that discriminated on the basis of familial status came to an unsympathetic end. The case, which was initiated to enforce provisions of the Fair Housing Act against the condominium association, resulted in a consent agreement without going to trial.

The Fair Housing Act prohibits discrimination against individuals based on race, color, religion, sex, handicap, familial status or national origin. The Fair Housing Act applies to community associations in that it prohibits discrimination in the provisions of services or facilities with respect to residential housing.

Familial status means one or more individuals below 18 years of age who are domiciled with a parent or legal custodian, or with the designee of such custodian, or with the designee of such parent or legal custodian. This includes a person who is pregnant or in the process of securing legal custody of a child.

Familial status issues arise most often from rules and regulations adopted by community associations that treat residents differently because of their age or which have a disparate impact on residents because of their age. Even though age is not a protected class under the Fair Housing Act, the effect of limiting access to services and facilities based on age negatively impacts families with children and constitutes familial status discrimination.

In the DOJ case, the Minnesota association adopted rules requiring children to be supervised by an adult at all times when playing in common areas. The association, its property manager, and its on-site manager were sued by the DOJ for discriminating against children by restricting them from playing in the common areas of the association. The association and the property managers were also accused of selectively enforcing the rules regulating the use of the common areas and by failing to comply with the requisite enforcement procedure before issuing violation notices to owners.

While the association specifically denied all allegations, it agreed to resolve the litigation without a trial. The agreement required the association to refrain from discriminating based on familial status or from making any statements indicating any preference based on familial status. The association was required to adopt a Nondiscrimination Policy and undergo mandatory discrimination training.

The harshest penalty came in the form of compensation. The association agreed to pay the injured parties $100,000.00 and was required to pay a civil penalty of $10,000.00. Additionally, the association was prohibited from assessing any of the injured owners in order to fund the compensation award.

This case is an example of the strict penalties that may result in a violation of the Fair Housing Act. It is important to tailor rules that will be applied equally to all residents, regardless of age. If your association has questions about rules regulating children, please call our office and we can review your specific situation.

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