Help Your Clients Avoid Stumbling into Fair Housing Problems, Part 2

We recently shared some ways that community associations can unexpectedly find themselves liable under federal and state fair housing laws. Here are few more missteps our experts have identified as potentially risky.

Inadvertent Familial Discrimination

JoAnn Burnett, an attorney in the Fort Lauderdale, Fla., office of Becker & Poliakoff who focuses her practice on fair housing and discrimination claims, says familial discrimination trips up many associations.

“They have provisions in the governing documents — especially rules and restrictions but also in declarations — regarding children,” she says. “Even if not enforced, it’s a problem if they’re on the books.

“A lot of those rules get overlooked because they don’t look menacing on their face, but once someone gets a hold of it for a fair housing complaint, the association is going to be in trouble.” Rules requiring children to wear water diapers in the pool represent one such culprit.

David Muller, a shareholder and board-certified specialist in condominium and planned development law with the Naples, Fla., office of Becker & Poliakoff, says he regularly hears from boards about what he calls “the incontinence issue,” where an association has a water diaper rule for kids but not for adults with the same problem.

“The key is to draft such rules so they’re age-neutral,” he says. “Instead of saying children have to wear swim diapers, you say all persons who are incontinent must wear appropriate attire when in the pool. A lot of clients think this is silly and just PC, but, as lawyers, we’re just interested in potential liability, and associations have run afoul of this in the past.”

Failure to Comply with 55-and-over Requirements

Burnett cautions 55-and-older communities about feeling a false sense of security when it comes to potential familial discrimination liability: “I’ve run into plenty of these communities that never implemented the necessary language in the declaration. For example, they don’t conduct the required survey every two years to make sure they’re in compliance.” That leaves associations vulnerable to claims that they otherwise would be protected against.

As a reminder, to qualify for the 55-or-older exemption from familial discrimination, a community must:

• Have at least one occupant who is 55 years old or older in at least 80 percent of the units,
• Publish and adhere to policies and procedures that demonstrate the intent to operate as 55-or-older housing, and
• Comply with HUD’s regulatory requirements for age verification of residents through reliable surveys and affidavits.

Remember, too, that the exemption doesn’t protect associations from liability for housing discrimination due to race, color, religion, sex, disability, or national origin.

Criminal Background Checks

Burnett says associations can get themselves in hot water, too, by misusing the results of criminal background checks.

“HUD released guidance a few years back about what you can and can’t use as a basis to deny someone’s application to purchase or lease,” she says. “But I’ll see an association that ran a screening and wants to deny an application because the person was arrested for drugs or some other felony — even though there’s never been an actual conviction.

“If there’s no conviction, you definitely can’t deny, and, even if there is, it can’t be for just burglary or anything like that. It really needs to be an egregious crime.”

Muller agrees: “A lot of our clients are under the misconception that any criminal offense, even a misdemeanor from 20 years ago, is a reason they can deny, and that’s just not the case.”

Note, too, that many states prohibit communities from reviewing potential buyers. And, even where states permit an association to review renters’ applications (not owners’), many attorneys advise boards against the practice.