IMU5: Unit 5: Exceptions & Canons



HOUSING DISCRIMINATION SPRING 2008

INFORMATION MEMO ON UNIT FIVE

TABLE OF CONTENTS

(A) Unit Five: Covered Topics & List of Relevant Exam Questions

(B) User-Friendly Layout of §3603(b)(1)

(C) The Single Family House Exemption: Selected Issues

(D) City of Edmonds: Summary of Arguments

(A) Unit Five: Covered Topics

& List of Relevant Old Exam Questions

(1) Religion & Privacy: Constitutional Defenses (and Policy Interests)

(a) You will not be tested on Constitutional Doctrine.

(b) You can argue that a statute should be interpreted a particular way or that a proposed amendment should or shouldn’t be adopted …:

(i) to further the interests in protecting religious belief and privacy; OR

(ii) to avoid potential conflicts with the Constitutional rights to Free Exercise of Religion and to Privacy.

(c) Comments & Model Answers for Assignment IV

(d) Old Exam Questions: 1J 2B 2E 3B

(2) Non-Statutory Defenses

(a) Non-Statutory Defenses Generally: Old Exam Questions 1C 1E 1H 1I 1J

(b) Sex Discrimination & Related Defenses: Old Exam Questions 1H 2E 3E 3P

(c) Integration Maintenance

(i) Comments & Model Answers for Assignment V

(ii) Old Exam Questions: 1A 1B 1E 2C 2F

(3) Statutory Defenses

(a) Might Be Covered on Exam:

(i) Religious Organizations

(ii) Single Family House Exception

(iii) See Old Exam Questions 1I 2E 3B 3E 3F 3J 3K

(b) Will Not Be Covered on Exam:

(i) Private Club

(ii) Mrs. Murphy

(iii) Maximum Occupancy Limits

(4) Canons of Construction: Written Assignment VI: Comments/Models

(B) User-Friendly Layout of §3603(b)(1)

§3603(b) Exemptions. Nothing in [§3604] (other than subsection (c)) shall apply to—

(1) any single-family house sold or rented by an owner:

[First Proviso:] Provided, That such private individual owner does not own more than three such single-family houses at any one time:

[Second Proviso:] Provided further, That in the case of the sale of any such single-family house by a private individual owner not residing in such house at the time of such sale or who was not the most recent resident of such house prior to such sale, the exemption granted by this subsection shall apply only with respect to one such sale within any twenty-four month period:

[Third Proviso:] Provided further, That such bona fide private individual owner does not own any interest in, nor is there owned or reserved on his behalf, under any express or voluntary agreement, title to or any right to all or a portion of the proceeds from the sale or rental of, more than three such single-family houses at any one time:

[Fourth Proviso:] Provided further, That … the sale or rental of any such single-family house shall be excepted from the application of this title only if such house is sold or rented

(A) without the use in any manner of the sales or rental facilities or the sales or rental services of any real estate broker, agent, or salesman, or of such facilities or services of any person in the business of selling or renting dwellings, or of any employee or agent of any such broker, agent, salesman, or person; and

(B) without the publication, posting or mailing, after notice, of any advertisement or written notice in violation of [§3604(c)];

but nothing in this [fourth] proviso shall prohibit the use of attorneys, escrow agents, abstractors, title companies, and other such professional assistance as necessary to perfect or transfer the title …

(C) The Single Family House Exemption: Selected Issues

1. Ambiguities and Open Questions Regarding §3603(b)(1)

(a) Can anyone besides the owner claim the exemption? (See DQ115)

(i) One view is that the exemption belongs only to the owner. See Singleton.

(ii) Another view is that the exemption attaches to the house. That is, so long as the house is being rented to someone else by the owner, it is a “single-family house … rented by an owner” and §3604 doesn’t apply at all. See Pulcinella and discussion below.

(b) When a single structure contains more than one dwelling unit, is any one of these dwelling units a “single family house”?

(i) Literally, the term “single family house” seems to mean only a structure designed to hold just one family. Lamb appears to adopt this view when it does not count the units in a duplex as “single family houses.”

(ii) However, if you take that reasoning seriously, a condominium in a building containing 30 units would not be a single family house, but part of a 30-family house. In that case, even if that condo was the only residence your family owned, you would not be eligible for the exemption. That seems inconsistent with the purposes of the exemption. Hogar Agua seems to treat one of the units in a duplex as a single family house.

(c) Under what circumstances can people in the real estate business invoke the exemption on their own behalf?

(i) Real Estate Professionals who own no more than three single family houses and no other real estate. (See DQs 116 & 119): This depends on the interpretation of the Fourth Proviso, which says that you cannot only invoke the exception with regard to a transaction made “without the use in any manner of the … sales or rental services of any real estate broker, agent, or salesman, or of such … services of any person in the business of selling or renting dwellings…”

(A) If a court decides that real estate professionals cannot possibly engage in such a transaction without the use of their own services, then they never can invoke the exception.

(B) If a court decides that real estate professionals are not inherently “using” their own services, it might allow the exemption. The Sixth Circuit in Babin allowed a real estate agent to invoke the exception so long as she didn’t take advantage of the tools at her workplace (such as computer listings).

(ii) People who own no more than three single family houses but own other kinds of real estate (e.g. a thirty-unit apartment complex) The language of the exemption does not place any limits on any real property ownership other than single family houses. On the other hand, it would be odd if a person who owned four single family houses couldn’t use the exemption, but someone could who owned three single family houses plus five 100-unit apartment complexes.

2. Write-Up of Discussion Question 120 from a Prior Class: Pulcinella v. Ridley Township (PP.371-74), addressed a challenge under §3604(f)(3)(B) to a refusal by a local municipality to allow a variance so that a person with a recently acquired disability could make his house usable. The court held that the FHA did not apply because the single-family house in question was owned by a person who owned no other residential property.

a. Is this holding supported by the language of §3603 (b)(1)?

i) Note that there is no question that the landlord could invoke the exemption, but she doesn’t want to. The legal question is whether the municipality can invoke the exception. Students divided on the plain meaning arguments. Look at the text and see if you can see both sides:

ii) One view is that the exemption belongs only to the owner (Singleton approach):

(A) A plain language argument would prevent the municipality from being able to use the FHA exemption. The plain language of the statute exempts the owner, not the municipality.

(B) When using the plain meaning of the statute in 3603(b)1, when the court says “any single-family house…” the exemption applies to the house and the homeowner,  but not to the municipal board.  …The municipal board is trying to extend the exemption to include the board, so that they do not have to grant the variance.  A literal reading of the statute does not seem to support such a contention, so the court, although correct in stating the law, was incorrect in applying the exemption to the municipal board.

(iii) The other view is that the exemption attaches to the house. That is, this house is being rented to the plaintiff by the owner, so this is a “single-family house … rented by an owner” and §3604 doesn’t apply at all.

b. Is this holding supported by the policy behind of §3603 (b)(1)?

(i) The Policy Behind the Exemption

• A policy behind the exemption is a person’s right to do what they want with their own home The first policy does not help the municipality fall under the exemption because the municipality is not the owner.

• Another policy behind the exception is the difficulty of enforcing the statute on a small scale. The second policy does help the municipality fall under the exemption because this is one house and the courts may not want to deal with the litigation.

• This is the only residential property that the landlord owned, so not making the

alterations in this instance wouldn’t deprive a large portion of the

(disabled) population of housing, as she did not own multiple dwellings.

(ii) The Policy Behind the FHA

• The Pulcinella holding had the effect of making a home unavailable to a handicapped tenant because of their handicap. The holding is, therefore, in direct opposition to the policy of the Fair Housing Act:

• Discriminating against someone with a handicap by not allowing for necessary modifications to the dwelling is exactly the type of discrimination that is intended to be deterred.

(D) City of Edmonds: Summary of Arguments

Although you will not be tested on the operation of 42 USC §3607(b)(1), you may wish to work through the statutory and policy arguments from this case, which might be helpful for your exam (especially for Question I)

I. OVERVIEW: In City of Edmonds, the Supreme Court answered an important question about the scope of 42 USC §3607(b)(1), the exception to the Fair Housing Act for “reasonable … restrictions regarding the maximum number of occupants permitted to occupy a dwelling.” Many municipalities have zoning restrictions that limit certain lots to residence by a single “family” and then define “family” to mean an unlimited number of people related by blood, marriage or adoption or a limited number of unrelated people.

These regulations that define occupancy in terms of “family” tend to exclude some people with disabilities. Many persons with disabilities receive therapeutic benefits from living in group homes. These homes often house between six and twelve disabled residents, providing structured care and support, while allowing the residents to live in a “normal” residential neighborhood. Because the occupants of the group homes generally are not related to one another, the group homes do not qualify for sites in single-family neighborhoods. The resulting ban on group homes, while not intended to exclude persons with disabilities, generally is seen as having a disparate impact on them.

In City of Edmonds, defendant Oxford House, which had opened a group home in Edmonds, asked the municipality to make an exception to its single-family zoning to permit the home to operate. It claimed that the exception would be a “reasonable accommodation” to the needs of its disabled residents. The FHAA requires such accommodations under §3604(f)(3)(B). The city brought a declaratory judgment action, claiming (among other things) that its single family requirements were fell within the §3607(b)(1) exception, and that it therefore did not have to make exceptions to the requirements. The Supreme Court disagreed, holding that the exception only applied to regulations that put an absolute cap on the number of occupants in a dwelling. Because Edmonds’s ordinance allowed any number of related people to live in a dwelling, it did not fall within the exception.

The case was important because most cities have single-family restrictions like the one at issue in the case. If the municipality had prevailed, these cities would effectively be able to prevent the establishment of group homes for the disabled in any single-family residential neighborhood. Below, I’ve laid out the statutory arguments made by both the majority and the dissent.

II. ARGUMENTS FROM LEGISLATIVE LANGUAGE: The majority argued that the language “regarding the maximum number of occupants permitted to occupy a dwelling” refers exclusively to absolute limits on the number of people who could live in a dwelling. Because the Edmonds provision placed no restrictions at all on the number of related people who could live together, the Court held that it did not fall within the language of the statute. As the Court stated, the provision “surely does not answer the question ‘what is the maximum number of occupants permitted to occupy a house?’”

To bolster the claim that the statutory language did not cover the city ordinance, Justice Ginsburg characterized it as a “family composition rule” as opposed to a “maximum occupancy restriction.” She argued that family composition rules protected the family character of neighborhoods where maximum occupancy restrictions protect health and safety by preventing overcrowding. She noted that the Court already had recognized this distinction as legally significant in Moore v. City of East Cleveland. She also noted that Edmonds itself had separate provisions that did place absolute caps on the number of residents, suggesting that the city itself recognized the distinction she was relying on. The Court appeared to be using the distinction to create a context in which its placement of the Edmonds provision in a separate category outside the statute would seem logical.

Justice Thomas in dissent takes the majority to task because its two categories are not well-established legal terms. He argues correctly that the majority cannot seriously contend that Congress intended that explicit distinction. Yet I think he misses the more general point, which is that the provisions the majority refers to as “family composition restrictions” are different in both form and purpose from typical maximum occupancy limits and so likely not within the exemption Congress created for the latter.

He also focuses on different words in the statute. §3607 refers to “any reasonable … restrictions regarding” maximum occupancy. Because the Edmonds ordinance does restrict the number of unrelated people who can occupy a dwelling, he says it is a restriction regarding maximum occupancy. Essentially, he says that “any” means we must read “restrictions regarding” broadly. Thus, as long as the provision sometimes establishes the maximum occupancy, it falls within this broadly defined statute.

My sense is that the plain language arguments are close to a dead heat: you could read the statute either way. Thus, you need to go further.

III. ARGUMENTS FROM LEGISLATIVE HISTORY: The majority relies on the House Report on the FHAA, which referred to limits on occupancy per unit based on the number of square feet. This suggests that they were not thinking of provisions like the Edmonds ordinance. Justice Thomas does not discuss legislative history at all.

IV. THE CANONS: The majority opinion relies on the canon that you read exceptions to remedial statutes narrowly to fulfill the remedial purpose of the statute. Here, that test suggests the broad reading suggested by the dissent of “any reasonable … restriction” is inappropriate. The dissent makes Justice Tatting-like arguments on the difficulty of identifying the primary policy behind the statute, but I don’t think it does a good job countering the usual rule about reading exemptions narrowly.

Instead, the dissent relies on the Gregory case for the proposition that the Court has not always narrowly construed exemptions from anti-discrimination statutes. However, in Gregory, the Court was trying to decide if state judges were “policy-making officials” exempt from the federal age discrimination statute. The Court read the exemption relatively broadly, but it did so to protect a key state interest: the right under its own constitution to decide on its own rules for appointing judges. By contrast, the state’s interest here would be in preventing a narrow exception to a local zoning ordinance for people with disabilities. Thus, I don’t find Gregory particularly persuasive.

Justice Thomas relies on a different canon: that Congress must make its intention clear when it intends to pre-empt a traditional state power. I find this reliance misplaced. Here, Congress repeatedly indicated in the legislative history that it intended the FHAA to limit the use of zoning to exclude group homes. Moreover, §3615 clearly states that Congress means to invalidate inconsistent local laws.

V. ARGUMENTS FROM STATUTORY PURPOSE: The majority notes that the exemption was added along with the familial status provisions. It sees the purpose of the exemption as showing that “landlords legitimately may refuse to stuff large families into small quarters….” To the extent that the exemption was primarily intended to modify the familial status provision, the majority’s reading is likely correct. It would make no sense to exempt provisions like the Edmonds ordinance, which do not limit the size of families with children at all.

To my view, both sides ignore the most significant policy argument. I find compelling the clear statements in the legislative history that Congress wanted to make it possible for group homes for people with disabilities to operate in residential neighborhoods. As noted in the introduction to this analysis, the dissent’s interpretation would likely bar group homes from many residential neighborhoods. Thus, Congress probably would not want the Court to adopt that interpretation.

In sum, between the standard rule about reading exemptions narrowly and the purposes of the FHAA, I am fairly convinced that Justice Ginsburg got this one right.

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