Familial Status Discrimination in HOA Rules

Familial Status Discrimination in HOA Rules
By: Sam Bell

Two 15-year-olds walk into an association’s fitness room.  A sign is posted on the mirror stating, “No children under 18 on the exercise equipment without adult supervision.”  Regardless of the sign, the children use the exercise equipment.  They are caught by the association and enforcement action is taken against the owners/parents.  The parents file a complaint against the association for discrimination with the Utah Antidiscrimination and Labor Division (“UALD”).  After going through the resolution and investigative process, the association is found guilty by the UALD for fair housing violations and fined.

What seemed like a simple rule to protect the exercise equipment and children back-fired on the association costing it thousands in fines and defense costs.

What happened?

Residential associations are subject to the Federal Fair Housing Act (“Fair Housing Act”).  The Fair Housing Act protects classes of people from discrimination based on race, color, national origin, religion, disability, gender, and familial status.  Utah statutes include source of income, gender identity, and sexual orientation as protected classes.  In the scenario I described above, the association discriminated on the basis of familial status.

Nearly every set of rules I have reviewed has multiple fair housing violations.  Some if not all of the fair housing violations are based on familial status.  Well-meaning associations create rules intending to protect children, but instead create liability.  It is very rare that I find discrimination against any of the other classes protected by the statute.

Familial status discrimination is when an association discriminates against one or more individuals younger than 18 years old who live with a parent or designee of a parent (designee being someone with written permission).  When reviewing association rules, it is one of the most prevalent fair housing risks we find.  It can appear in pool rules (e.g., adult swim time, diaper requirement), storage rules (e.g., no toys on the balcony), fitness center rules, and general common area usage rules.

In the example I gave, the association’s rule discriminated against children in its very terms.  The rule ignored the fact that some children know how to properly use exercise equipment and are physically developed enough to use the equipment.

When reviewing rules that expressly discuss children I will often replace the word “children” with a certain nationality or religion, such as “Russians” or “Catholics.”  This will readily show whether the rule is discriminatory.  If the exercise room rule had stated, “No Catholics on the exercise equipment without adult supervision,” it would be obviously discriminatory.  Had the association used this simple tactic when drafting their fitness room rule, it would not have passed the simple discriminatory test I just shared.

In addition to express discrimination, an association may be found in violation of fair housing laws by creating a rule that causes a disparate impact on children under 18.  A disparate impact is when a seemingly neutral rule disproportionately affects children.

For example, all the roads in another association are private.  The association creates a rule stating, “No bicycling, skateboarding, rollerblading, or playing in the roads.”  A family living in the association has young children who occasionally play in the road.  Upon learning about the rule, the family files a complaint against the association for discrimination with the UALD.  The association argues that the rule applies to all owners equally.  The rule is found to violate fair housing law and the association is fined.  What seemed like a simple rule to protect all people (not just children) from being injured in the private roads proved to be a costly violation of fair housing law.  The reasoning is that children are more likely to participate in the listed activities than adults.  Therefore, the rule had a disparate impact on children.

When discussing new rules associations should beware of the word children.  They should also look at the effect of rules to see if they disproportionately impact children.  When in doubt associations should contact their attorney to discuss potential liabilities.

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Press Release: CCIM Excellence Award

Sam Bell Honored as Finalist in Prestigious CCIM Excellence Award

SALT LAKE CITY, Utah-SEB Legal, a full service real estate law firm, is proud to announce that founder, Sam Bell, JD, is among the top two nominees for the prestigious CCIM Real Estate Attorney of the Year Award.

Contestants are judged in three main areas of law, including the complexity of case work, gravity of case work (specifically a case’s impact on the community and client), leadership and civility.

“CCIM is the industry standard in professionalism and I’m honored to be selected as a finalist,”Bell said. “2014 was a good and challenging year with several complex cases and I’m thankful for the recognition and ability to share these cases within the commercial real estate community.”

Bell founded SEB Legal in 2012, with a practice focus on real estate law, homeowners association law and landlord law, amongst other areas. SEB Legal has experienced explosive growth since being founded and currently has four attorneys and seven staff helping clients with their legal needs.

The CCIM is commercial real estate’s global standard for professional achievement.

“The CCIM Excellence Award for the 2014 year…is given to an elite group of professionals,”Ronda Landa, the award chair for the Utah CCIM said. “The competition was very tough and the applications very impressive, making the decision even more challenging.”

Winner of the CCIM Excellence Award to be announced in a ceremony on March 13, 2015.