The U.S. Supreme Court recently held that a private or public entity can be sued for discrimination even if there was no intent by that individual or group to discriminate, upholding the validity of disparate impact claims in fair housing issues. The ruling is based on the concept of "disparate impact" which, under the 1968 Fair Housing Act, states that any policy or practice that creates a disproportionate "adverse impact" on any group based on race, national origin, color, religion, sex, familial status, or disability may be considered discriminatory or illegal.
Opponents have maintained there needs to be intent for a discrimination suit to be valid. All federal courts of appeal have interpreted the law to mean that an entity can get sued for housing discrimination if its actions have a disparate impact on a protected class, regardless of intent.
The Supreme Court case involved Inclusive Communities Project, a nonprofit group that sued Texas Department of Housing and Community Affairs for allocating more federal tax credits for low-income housing in mostly poor, minority neighborhoods and fewer credits in wealthier white neighborhoods. The group successfully argued that this practice in effect kept low-income housing away from wealthier, white neighborhoods. Texas countersued, contending the Fair Housing Act only prohibits explicit or overt discrimination. The Supreme Court affirmed the Fifth Circuit Court of Appeals decision and ruled that the group's disparate impact claim was valid.
The Court went on to clarify that just because an action or policy has a disparate impact, it does not mean it is discriminatory. For the disparate impact claim to be valid, a party suing must show that there is an alternative policy or practice with a less discriminatory effect that would equally serve the defendant's legitimate business interest.
"The Court's ruling affirms the original intent of the 50-year-old Fair Housing Act and has implications on housing, exclusionary zoning policies, and even lending practices," says Chris Isaacson, president of the Silicon Valley Association of Realtors. "When considering the adoption of any housing policy or restriction, local governments and other entities should make sure the policy will not have an unintended adverse impact on a protected class."
According to Isaacson, Realtors play a vital role in ensuring fair housing for all. "Realtors strive to make homeownership accessible to everyone and ensure all groups of people enjoy the benefits of a housing market free from discrimination," says Isaacson.
Buyers or renters who believe they have experienced discrimination may file a complaint with at http://www.hud.gov. Complaints must be filed within one year of the alleged discrimination.
The Silicon Valley Association of REALTORS® (SILVAR) is a professional trade organization representing over 4,000 REALTORS® and Affiliate members engaged in the real estate business on the Peninsula and in the South Bay. SILVAR promotes the highest ethical standards of real estate practice, serves as an advocate for homeownership and homeowners, and represents the interests of property owners in Silicon Valley.
The term "REALTOR®" is a registered collective membership mark which identifies a real estate professional who is a member of the National Association of REALTORS® and who subscribes to its strict Code of Ethics.
Variations of this article have appeared in local area newspapers.
For further information, please email or call the SILVAR office at (408) 200-0100.