• Neighbor-to-Neighbor Harassment: How To Minimize Community Associations’ Liability
  • April 27, 2017 | Author: Shirley M. Steinbach
  • Law Firm: Lerch, Early & Brewer, Chartered - Bethesda Office
  • Community Associations Update

    Many community associations and property managers are experiencing anxiety in the wake of new Fair Housing Act (FHA) regulations governing neighbor-to-neighbor harassment.

    Amongst the angst, however, it is important to remember that community associations are not responsible under the new regulations for correcting all neighbor-to-neighbor harassment on their properties. Even better, community associations can take concrete steps to minimize their exposure to liability under the FHA.

    When Are Community Associations Liable For Neighbor-to-Neighbor Harassment?

    The FHA regulations impose liability on community associations for failing to take prompt action to correct neighbor-to-neighbor harassment where a complainant can establish the following four elements:
    1) The harassment is perpetuated on account of race, color, religion, sex, familial status, national origin, or disability.
    If a neighbor is harassing another neighbor simply because he does not like him, or due to a financial dispute, a community association cannot be held liable under the law.
    2) The harassment is objectively severe or pervasive.
    It is difficult to provide general guidance regarding the type of conduct that rises to the level of “severe or pervasive” because incidents of harassment are fact-specific. Moreover, at this time, few if any cases interpreting the meaning of “severe and pervasive” in the context of the new FHA regulations have been ruled upon (and because of the “heightened expectation of privacy within the home,” reliance on cases involving workplace harassment is “not always appropriate,” according to the Department of Housing and Urban Development).
    3) The association has knowledge from which a reasonable person would conclude that harassment was occurring.
    An association has the requisite knowledge when, for example, a board member or a manager (i) hears one resident use a racial slur against another resident, and/or (ii) receives an informal report from a third party regarding a resident using a racial slur against another resident. It is not settled whether an association can be held liable for the knowledge of its independent contractors, such as lifeguards and landscapers, but most lawyers might agree that the better argument is that an association cannot be.
    4) The association had “the power to correct” the harassment.
    A community association’s power to respond to third-party harassment generally comes from its governing documents, including its declaration and bylaws. Many associations have the power to correct harassment because their governing documents prohibit offensive activity at the property and give associations the power to enforce that prohibition, for example, by assessing fines after a hearing and/or by filing a lawsuit.
    If a complainant cannot establish all four of these elements, a community association can safely stay out of a neighbor-to-neighbor harassment dispute.

    How Can Community Associations Minimize Their Exposure To Liability?

    As suggested above, harassment claims under the new FHA regulations are fact-specific, are relatively untested by the courts, and should be considered in light of each association’s unique governing documents.

    For this reason, community associations should promptly refer all complaints of harassment to their legal counsel (or to the police if the alleged harassment poses a threat to bodily harm, a resident’s safety, or the security of the community). The association and its counsel can work together to:
    • Investigate the complaint.
    • Evaluate whether the complaint is has merit and, if it does, ensure it is addressed promptly.
    • Keep written records documenting all steps taken to resolve the complaint.
    • Keep the victim of alleged harassment continually updated regarding the processing of the complaint.
    The association and its counsel can also work together to determine what remedial actions (if any) are necessary and appropriate, both from a legal and a business perspective. These actions may include:
    • Sending the perpetrator of the harassment a cease and desist notice.
    • Holding a hearing before the board of directors.
    • Fining the perpetrator of the harassment.
    • Referring the matter to an administrative body.
    • Filing a lawsuit for injunctive relief against the perpetrator.
    • Doing nothing because the risk of liability under the FHA is low.
    Above and beyond ensuring harassment complaints are properly handled, community associations can consider additional measures to minimize their liability under the new FHA regulations. Industry professionals may encourage associations to offer fair housing training to their residents, adopt anti-harassment rules, make complaint forms available to residents, and/or evaluate their insurance coverage.

    However, a strategic community association lawyer can tell you that some suggested measures are likely to subject an association to additional legal requirements and to more liability. In addition, some measures are not cost-effective. Ask your lawyer what measures are right for your community association.