Non-action may no longer be a safe choice. In October of 2016, the United States Department of Housing and Urban Development (“HUD”) added certain provisions to the Fair Housing Act (“FHA”) which impose additional liability for condominium associations, homeowners associations, and landlords based on non-action.
One of the main additions to the FHA was the inclusion of a prohibition of quid pro quo harassment. Under the new provision, it is illegal to request or demand conduct in exchange for the sale or rental of a unit or dwelling, the provision of services for a unit, or the terms or conditions of residing in a unit. This most commonly cited example by HUD of possible scenarios that would fall under the new provision were those related to sexual acts in exchange for the providing maintenance or services, or abstaining from engaging in otherwise bothersome or prohibited conduct or terms of residency.
Additionally, HUD added a new provision to the FHA which defines hostile environment harassment as “unwelcome conduct that is sufficiently severe or pervasive as to interfere with: [t]he availability, sale, rental, or use or enjoyment of a dwelling; the terms, conditions, or privileges of the sale or rental, or the provision or enjoyment of services of facilities in connection therewith; or the availability, terms, or conditions of a residential real estate-related transaction. Hostile environment harassment does not require a chance in the economic benefit, terms, or conditions of the dwelling or housing-related services or facilities, or of the residential real-estate transactions.” § 100.600
HUD’s changes now make a person or entity directly liable for “[f]ailing to take prompt action to correct and end a discriminatory housing practice” by either that person’s employee, agent, or third-party if the person knew or should have known about the discriminatory conduct, and – in the case of a third-party – if the person had the power to correct the conduct. § 100.7(a)(1)(ii)-(iii).
The later change alone requires Associations and property management companies to take prompt action to correct a discriminatory housing practice – even by a third-party – if the Association or company is aware (or should have been aware) of the action and could have corrected it. No longer can Association’s or companies merely listen to complaints by one owner against another, but they must now take affirmative action to stop discriminatory conduct by those owners. Because of the first addition mentioned above, the requirement for Association’s to act include situations in which a unit owner has propositioned another unit owner in exchange for compliance with the Association’s rules and regulations.