Caseflicks

District Court, D. Massachusetts • 2001

Marya v. Slakey

190 F. Supp. 2d 95 | 2001 U.S. Dist. LEXIS 22582

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Takeaway

In short, this case holds that a landlord may face housing-discrimination liability for a tenant’s discriminatory screening decision when the landlord has consistently delegated and retained ultimate control over the tenant-selection process.

Background

Linda Slakey owned a six-bedroom house in Amherst, Massachusetts, which she leased to six unrelated tenants under a single joint-and-several lease. The tenants typically advertised vacancies, interviewed applicants, and selected a replacement unanimously. Slakey retained contractual authority to approve occupants and could check references, but ordinarily accepted the tenants’ selections and amended or renewed the lease to add each new resident.

When a vacancy arose in 1998, Kriti Aurora, an Indian graduate student at UMass, applied. She met the house’s usual requirements: tenants had to be students, vegetarians, and nonsmokers. Tenant Paul Norris voted against her. According to several witnesses, Norris said he did not want a third Indian woman in the house and did not want the house dominated by one culture. Another tenant, Suzanne Castello, also opposed Aurora for asserted personality-conflict reasons.

Other tenants told Slakey about Norris’s stated reasons and asked her to intervene. Slakey said Norris had a right to decide whom he lived with, spoke with him, and ultimately declined further involvement. The vacancy was filled by someone who did not satisfy the usual student requirement.

Aurora and Deepika Marya sued Norris and Slakey under the Fair Housing Act, 42 U.S.C. §§ 3604(a) and (c), 42 U.S.C. §§ 1981 and 1982, and Massachusetts General Laws chapter 151B, and also alleged negligence. The court had previously dismissed Marya for lack of standing. On the remaining plaintiff’s claims, the defendants moved for summary judgment. The court denied the motion.

Issues

Issue #1

Whether a reasonable jury could find that Norris acted as Slakey’s actual agent in rejecting Aurora’s housing application under the Fair Housing Act and the Civil Rights Act.

Holding

Yes. The evidence was sufficient to permit a jury to find an actual agency relationship, so summary judgment was improper.

Reasoning

Federal, rather than Massachusetts, agency law governs the Fair Housing Act and Civil Rights Act claims. Applying the Restatement and HUD’s parallel definition, agency may arise from the parties’ conduct: the alleged principal must authorize the other to act on her behalf and subject to her control, and the other must accept that role. The court considered only actual agency because Aurora had never dealt directly with Slakey and therefore could not establish apparent authority.

Although Slakey did not expressly delegate tenant-selection authority to Norris personally, a jury could infer agency from the parties’ established practice. Over many vacancies, tenants—including Norris—advertised openings and chose replacements. Slakey consistently accepted their choices, executed or modified leases to include the selected newcomers, and never rejected a tenant-approved applicant. That pattern could show that tenants were performing a rental-related function for Slakey with her acquiescence.

Slakey retained enough control to satisfy the agency requirement. The lease reserved to her the ultimate authority to approve any additional occupant, and she believed she could reject candidates presented by the tenants. She also retained the right to check applicants’ references. Agency does not require continuous, day-to-day control; an owner’s retained final approval authority may suffice.

A jury could also find that Slakey benefitted from the tenants’ role. Their work in advertising vacancies, showing the house, interviewing applicants, and selecting replacements spared her the expense and burden of handling those tasks herself. The fact that the tenants were jointly and severally liable for rent did not eliminate that practical benefit.

The court rejected Aurora’s separate ratification theory. Ratification requires that the person whose conduct is ratified have purported to act for the alleged principal. Because Norris was not alleged to have represented that he was acting for Slakey, ratification did not apply.

Issue #2

Whether the evidence could establish an agency relationship between Norris and Slakey under Massachusetts General Laws chapter 151B.

Holding

Yes. The same evidence of Slakey’s repeated acquiescence in tenant selection practices could support a jury finding of agency under Massachusetts law.

Reasoning

Massachusetts agency law, like federal agency law, permits an agency relationship to be implied from a course of conduct in which a principal repeatedly acquiesces in and adopts similar acts. Slakey’s longstanding acceptance of tenants’ screening and selection of replacement residents therefore created a triable agency question under chapter 151B as well.

Issue #3

Whether Norris was outside the Fair Housing Act because he was not professionally engaged in the business of selling or renting housing.

Holding

No. The Act and HUD’s regulations are not limited to professional real-estate actors.

Reasoning

The court found no legal support for treating Norris as exempt merely because he was a tenant rather than a professional landlord or broker. Fair Housing Act liability may extend to a person authorized to take rental-related action for an owner, regardless of whether that person works in the real-estate business.

Issue #4

Whether Castello’s separate nondiscriminatory vote against Aurora made Norris’s alleged discriminatory rejection legally irrelevant.

Holding

No. A second tenant’s opposition did not eliminate the possible legal significance of Norris’s alleged discrimination.

Reasoning

The defendants supplied no authority for the proposition that another tenant’s vote rendered Norris’s conduct nugatory. Given the Fair Housing Act’s broad remedial purpose, the court declined to adopt such a narrow construction where the house’s unanimous-selection practice gave each tenant—including Norris—an effective veto over an applicant.

Issue #5

Whether the owner-occupied dwelling exemption in 42 U.S.C. § 3603(b)(2) exempted the residence from the Fair Housing Act.

Holding

No. The statutory exemption did not apply because Slakey did not occupy the residence.

Reasoning

Section 3603(b)(2) applies only to certain small dwellings in which the owner actually maintains and occupies one of the living quarters as a residence. Slakey did not live in the six-bedroom house, so the required owner-occupancy condition was absent.