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Landlords Pay Over $2 Million in Harassment Complaints! – By Judy Drickey-Prohow, Esq.

Posted on 27. Feb, 2012 by in all, Magazine Articles

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How do you deal with issues of harassment on property? Don’t ask, don’t tell doesn’t work any more.
Over the last five years HUD and other enforcement agencies have seen increasing numbers of fair housing complaints alleging that properties are failing to deal with issues of harassment. In some instances, the claims involve harassment by a manager. Sometimes the alleged harasser is the maintenance person. Sometimes it is another tenant. Properties that fail to anticipate these claims and establish appropriate procedures for dealing with them can face substantial liability when the allegations are substantiated.

What Is Harassment?
HUD’s guidance from November 2008, http://www.hud.gov/content/releases/q-and-a-111708.pdf., provides a good starting point in analyzing harassment. In that guidance HUD looks to decisional law in the employment context to identify the characteristics of harassment and to define when a property may be liable for it.
Among other things, HUD notes that to establish a case of harassment, the person must show that he or she was subjected to unwelcome and unsolicited conduct that occurred because of a person’s membership in a particular protected group. Because “unwelcome” conduct goes to the mindset of the purported victim, a person can allege and often prove harassment even if he/she voluntarily submitted to the challenged conduct.
HUD also recognized that there are two kinds of harassment: (1) quid pro quo harassment and (2) hostile environment harassment.
In quid pro quo harassment, there is liability when a housing provider, or its employee, agent or contractor, conditions access to or retention of housing on a person’s willingness to submit to unwelcome conduct, such as sexual conduct, that occurred because of the person’s membership in a protected group. Where hostile environment harassment is alleged, the allegation is merely that the person was subjected to hostile, intimidating or offensive behavior that is sufficiently severe or offensive that it changes the terms and conditions of the individual’s housing. Claims based on either concept can be filed regardless of whether an individual experienced the loss of a housing opportunity or some tangible economic harm.

While most harassment cases deal with claims under a “hostile environment” analysis, properties cannot sit back and wait for harassment to become pervasive before they do something about it. The definition of hostile environment is posed in the alternative and courts balance the severity of the conduct with the pervasiveness of it. Thus, conduct that is exceptionally severe often has to happen only one time before the property faces liability.  In an employment context, for example, several courts have held that  “no single act can more quickly alter the conditions of employment and create an abusive working environment than the use of an unambiguously racial epithet. . .“  Similarly, either an actual or attempted sexual assault is considered sufficiently severe as to change a person’s terms and conditions of tenancy.

When Is a Property Liable for Harassment?
As in the employment context, under the fair housing act liability for harassment exists directly, when a property owner or manager engages in the conduct, and vicariously, when an employee or agent has engaged in harassment with or without the knowledge of the owner or manager.
In addition, there are a series of fair housing decisions in which courts have found properties liable for tenant-on-tenant harassment when the owner or manager knew or reasonably should have known of the harassment and failed to take prompt effective remedial action to stop it  and ensure that it did not recur. HUD is in the process of drafting new harassment regulations that are due out this year. When those rules are issued, HUD is expected to take a firm position holding properties liable for tenant-on-tenant harassment under these circumstances.

What Are the Consequences to a Property
When HUD Finds Harassment?
In recent years HUD has taken a very proactive approach to all cases where it has been able to substantiate allegations of harassment, and that approach has proved exceptionally costly to property owners and management companies. A sample of verdicts and settlements over the last five years includes the following:
•    In January 2010 a Baltimore landlord was required to pay $106,000.00 for creating an unwelcome environment for a family with children and seeking to have them evicted.
•    In August 2009 a Dayton, OH jury returned a verdict of $246,640 in favor of a resident whose landlord had subjected her to severe, pervasive and unwelcomed verbal and physical sexual advances, had demanded sexual favors from her and had tied sexual favors to repairs. The tenant had moved out after living in the unit for one week.
•    In September 2008 a Cincinnati landlord agreed to pay $1,000,000.00 in monetary damages and a civil penalty as compensation to twelve women who had been sexually harassed.
•    In March 2008 a lawsuit by 15 Latino families alleging that the Caucasian resident managers of the Alpine Mobile Home Park in San Pablo, CA repeatedly used racial slurs and intimidating behavior was resolved for $520,000.
•    In September 2007 the United States Department of Justice negotiated a settlement in a case alleging that a property owner in Minnesota had directed unwelcome verbal advances and unwelcome touching at female residents, and had entered their apartments without notice or permission. In that settlement the owner agreed to pay the victim $360,000 and to use a property management company in the future to manage all of his units.
•    In a similar case where the alleged harasser was a property manager, the court awarded judgment against both the owner and management company and assessed damages at ten percent of the property’s net worth.
•    In 2006, the Justice Department settled a sexual harassment complaint against a property where tenants alleged that a former maintenance employee had sexually harassed female residents. The property was ordered to pay $95,000 to resolve the suit under the theory that the on-site manager had failed to take action to prevent the maintenance employee from continuing to harass female tenants.

Practice Tips
While no one can prevent a complaint of harassment from being filed against a property, there are things that properties can do to protect themselves from the likelihood that anyone will prevail on such a claim:

•    Let staff and residents know that you will not tolerate harassment under any circumstances.
•    Train your employees to identify harassment
•    Remember that anyone who is aware of harassment has the right to report it and make a claim based on it, even if the harassment is not directed at that person.
•    Encourage residents to report conduct that they believe is harassment so that you can look into it before HUD does.
•    If someone reports that harassment is occurring, investigate the allegation and document your investigation.
•    If you find that an employee is engaging in harassment, immediately engage in appropriate disciplinary action and document it.
•    If you find that another resident is engaging in harassment, take appropriate action against that resident. At a minimum harassment is a violation of the legal requirement of quiet enjoyment of a person’s tenancy.

Judy Drickey-Prohow is an attorney with the Law Offices of Scott M. Clark and can be reached at 520-241-1847.
The views expressed here are generalized advice or information.   Fact-specific questions should always be referred to legal counsel.  Statements and opinions expressed in this legal column are solely those of the author or authors.