February 2009 Coach's Quiz
We have given you five rules on how to prevent fair housing trouble caused by outside contractors. Now let's look at how the rules might apply in the real world. Take the COACH'S QUIZ to see what you have learned.
INSTRUCTIONS: Each of the following questions has only one correct answer. On a separate piece of paper, write down the number of each question, followed by the answer you think is correct—for example, (1)b, (2)a, and so on.
And this month, there's an extra credit assignment: Judge for Yourself, a description of what happened in an actual court case. Test yourself on whether you think the community should be held liable, and then check the summary of the court's ruling to see how much you have learned.
COACH'S TIP: The correct answers (with explanations) follow the quiz. Good luck!
QUESTION #1
You have used the same plumbing contractor for many years. A resident calls about a plumbing problem and insists on being home when the plumber comes to fix it, but no one from your staff is available to escort the plumber to the resident's unit. You've never had any trouble from the plumber before, so there won't be any problem if you tell him to go to the unit on his own. True or false?
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True.
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False.
QUESTION #2
Your community needs some electrical work done quickly. When you call your usual electrical contractor, he says he's unavailable, but he recommends another contractor whom he knows will do a good job. The new contractor comes over right away, but he says he has to get to another job as soon as possible. What should you do?
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Let him start working right away.
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Explain your fair housing policy while taking him to see the problem.
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Explain your fair housing policy, and ask him to sign an acknowledgement and indemnification agreement before allowing him to perform any work.
QUESTION #3
While passing by the pool on your way to show a unit to an applicant, you notice the landscapers taking their lunch break. Most of them are sitting under one of the only trees nearby, but two of them are standing by the fence trying to talk to some of the female residents sunbathing by the pool. You should:
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Do nothing because no one has complained about them.
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Check to see if they are still there when you finish showing the unit; if not, just forget about it.
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Report what you saw to your manager.
EXTRA CREDIT: JUDGE FOR YOURSELF
Your community hires an independent property management company to act as your exclusive leasing agent and manage the property. The contract calls for the property management company to “perform all reasonable services requested by [the owner] in regards to operating, maintaining, servicing, and leasing the property.” It also provides that the property manager is to be the “sole tenant contact.”
One day, you receive notice that you are being sued for race discrimination under the FHA. Even though you are not being accused of any discriminatory actions, the complaint alleges that you are responsible for the discriminatory conduct of the property manager and its employees.
From reading the complaint, you learn that a leasing representative, who was an employee of the property management company, showed a unit to two African-American men. The men said they signed a one-year lease and paid an initial deposit.
Shortly before their move-in date, the men said that they dealt with another representative when they called about getting the keys to the unit. The complaint alleged that the second representative requested a larger deposit and suggested that they were not “the right fit for the building, because the ‘professional’ living downstairs would not like having unruly college-age residents living above him.”
A short time later, the men found out that the unit had been rented to someone else. When they went to get their deposit back, the first representative allegedly told them that they probably did not get the unit because the “professional” had called the management office to ask why the unit was being shown to “two black hoodlums” and said that he would not be happy if the unit was rented to African Americans.
Since you didn't do anything wrong—or even know about the men's race—you don't think it's fair that you should be held liable for the conduct of the property manager and its employees.
What will the court decide?
Coach's Answers & Explanations
QUESTION #1
Correct answer: b
Reason: Rule #2 applies here:
Rule #2: Supervise Conduct of Contractors Working at Your Community
Even if you've known the plumber for years, there's still a risk of fair housing trouble if you don't arrange to have a staff member accompany him while he is working inside the occupied unit. Allowing a contractor to have direct, unsupervised contact with residents in the privacy of the unit could leave you vulnerable to accusations of discrimination or sexual harassment. And it could also lead to the plumber being falsely accused of wrongful behavior.
Wrong answer explained:
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To avoid fair housing trouble, it's a good idea to supervise contractors while they are working at your community, particularly when the work is to be performed inside occupied units.
QUESTION #2
Correct answer: c
Reason: Rules #1 and #2 apply here:
Rule #1: Make Fair Housing Compliance Part of Your Contracts with Contractors
Rule #2: Supervise Conduct of Contractors Working at Your Community
If your community usually requires contractors to sign the fair housing acknowledgement form and indemnification agreement, you should do it for every contractor you hire. Signing the form confirms that the contractor understands and agrees to comply with your fair housing policies, and helps to protect you from fair housing trouble caused by the contractor.
Wrong answers explained:
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Contractors, such as electricians, may have little or no understanding of fair housing laws, so the burden falls upon you to explain your community's commitment to fair housing and to require contractors to confirm that they understand and promise to abide by the policy by signing your fair housing forms.
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A quick explanation of your community's fair housing policy may not be enough to protect you from liability in the event that your community is called upon to defend a fair housing complaint based on the contractor's conduct.
QUESTION #3
Correct answer: c
Reason: Rules #2 and #3 apply here:
Rule #2: Supervise Conduct of Contractors Working at Your Community
Rule #3: Take Special Precautions to Prevent Sexual Harassment Claims
You should report what you saw. It demonstrates that your community takes its obligations under fair housing law seriously even if your investigation shows the landscapers' conduct was harmless. On the other hand, if the investigation reveals a pattern of sexual harassment by the landscapers, your community will be in a position to do something to stop it.
Wrong answers explained:
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By ignoring the landscapers' conduct, your community is vulnerable to a fair housing complaint. If a resident later complains that you walked by while the landscapers were sexually harassing her, you may be hard pressed to defend against the accusation that you knew—or had reason to know—about sexual harassment by the landscapers, but didn't do anything to stop it.
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The landscapers may have gone back to work by the time you walk by, but that doesn't mean that you should ignore what you saw. You could still face a sexual harassment complaint weeks or months later.
ANSWER: JUDGE FOR YOURSELF
Even though you were not accused of any discriminatory actions, you could be held liable as the community's owner for any discriminatory conduct of the property manager and its employees under the FHA.
In the actual court case described, the lower court initially sided with the owner and dismissed the case, but the appeals court reversed the lower court's decision and sent the case back for further proceedings.
The court observed that the law generally holds an owner responsible for the actions taken by its agent. Whether the property management company was considered the owner's agent depends on a number of factors, but a key element was whether the owner had the right to “control” the property manager's actions.
In this case, the owner could be found to have exerted control over the property management company. The complaint alleged that the relationship between the property management company and the owner was governed by a property management agreement, which stated that the property management company would “perform all reasonable services requested by [the owner] in regards to operating, maintaining, servicing, and leasing the property.”
It didn't matter that the agreement also provided that the property manager was to be the “sole tenant contact.” That language did not prevent the owner from directing the manner in which the property manager dealt with residents, and it was not even related to the property manager's role as rental agent—that is, how it dealt with individuals who were not yet residents—the role at issue in this case.
Finally, the court said that the owner could be found liable even if it had no knowledge of the men's race. Such knowledge was required only if the owner had been accused of committing discriminatory actions; knowledge was not required to establish the owner's liability for the actions of the property manager or its employees [Cleveland v. Caplaw Enterprises, May 2006].
See The Lesson For This Quiz
| How To Protect Your Community From Fair Housing Violations By Outside Contractors |