Discriminatory Practices: Is Your Association Prepared? by KBR Legal

Discriminatory Practices: Is Your Association Prepared?

by Kaye Bender Rembaum

On September 26, 2016, Rembaum’s Association Round Up published an extremely important article regarding a community association’s potential liability when allegations by one member accuse another member of a discriminatory practice. (Click HERE to view the 2016 article). On September 13, 2016, HUD made clear that a housing provider is responsible for discriminatory practices that may take place. In its Rules and Regulations set out in Chapter 24, Part 100 of the Code of Federal Regulations, effective which further interprets the Federal Fair Housing Act, HUD explained that it believes that, “we are long past the time when racial harassment is a tolerable price for integrated housing; a housing provider is responsible for maintaining its properties free from all discrimination prohibited by the Act.” Those regulations became effective on October 14, 2016.

In this author’s opinion, HUD went way too far by mandating that housing providers act as the investigator, police, judge and jury in cases of alleged discrimination. After all, there are countless Fair Housing offices in each state where complaints can be filed and are actively investigated, often times with only a bare inference. Community association board members are volunteers with no required special training other than to be “certified” within 90 days of taking office, which certification can be met by signing a one-page form acknowledging duties or taking a two-hour class. Neither the individual board members nor the community as a whole should have to bear liability for its board of directors not taking action in a neighbor to neighbor dispute. Afterall, the court room is the proper setting where such matters should be resolved.

In the January 25, 2021, edition of the Palm Beach Post reporter Mike Diamond Special to Palm Beach Post USA TODAY NETWORK, authored an article titled “Judge Won’t Dismiss HOA Religious Bias Suit.” In the article the judge was quoted as follows: ““the La-Grassos [the plaintiff’s] have plausibly alleged a claim against the association for its failure to respond to or seek to control Ms. Tannenholz’s allegedly discriminatory conduct.” Amongst other things, the allegation is that Tannenholz’s told La-Grassos, “you do not belong in a community that is 80% Jewish and that La-Grassos should “move the F… out and go to a white supremist community.”

But for HUD’s position that a housing provider can have liability for discriminatory practices of the residents it is unlikely the association would be a defendant in this lawsuit. By forcing housing providers, such as Florida’s countless condominium, homeowners’ and cooperative associations, to interject themselves into what should be private disputes amongst neighbors, HUD is providing the deepest of pockets to the plaintiff’s attorneys. At the end of the day, it is just another reason to sue the innocent community association to create liability where there should not be any in the first place.

Practical Tip no. 1: In light of this lurking danger, be sure to check in with your association’s insurance agent to be sure the association has proper liability coverage for accusations of discrimination.

Practical Tip no. 2: Also, given that there can even be personal liability in such actions, board members would be wise to speak to their own personal insurance agents too… Afterall you never know when that umbrella policy may come in handy. Remember this, too: if one board member has knowledge about an event, then such knowledge can be imputed to all board members as if they are all similarly aware. In other words, when one board member knows, then the association itself is on notice.

Practical Tip no. 3: Consider formally adopting a “no discrimination” type of rule. It could be as simple as “discrimination of any kind will not be tolerated”.

Practical Tip no. 4: If your association is made aware of an alleged discriminatory practice, then a written record of such allegation and the association’s efforts to remedy the situation should be made.

Be sure to discuss each and every alleged discriminatory practice brought to the attention of the board and/or its manager with the association’s attorney to obtain the proper guidance needed.