Printable     Lesson Materials     Print these materials as a study guide                                  These printable...
California Real Estate Law                 Lesson 19:                 Civil Rights and                 Fair Housing Laws  ...
State Action vs. Private ActionDiscriminatory state action includes:  l discriminatory laws and regulations  l discriminat...
Federal Antidiscrimination LawsCongress later passed:  l Civil Rights Act of 1866  l Title VIII of the Civil Rights Act of...
Federal Antidiscrimination LawsCivil Rights Act of 1866Constitutionality of act challenged and upheld in1968 landmark case...
Federal Antidiscrimination LawsCivil Rights Act of 18663.      1866 Act is supplemented by—not replaced        by—Civil Ri...
Federal Antidiscrimination LawsFederal Fair Housing ActTitle VIII of the Civil Rights Act of 1968: prohibitsdiscriminatory...
Federal Fair Housing ActFair Housing Act exemptionsExemptions include:  l sale or rental by private owner  l rental in an ...
Fair Housing Act ExemptionsReligious organizations and private clubsReligious organization or private club may limitaccomm...
Federal Fair Housing ActProhibited acts (cont.)  l making, printing, publishing any notice,    statement, or advertising t...
Prohibited ActsSteeringSteering: channeling prospective buyers or rentersinto specific neighborhoods based on race or some...
Federal Fair Housing ActEnforcementHUD will investigate complaint and attempt tonegotiate agreement.If unsuccessful, dispu...
Federal Fair Housing ActEnforcementFor continuing acts, or for issue of publicimportance, Attorney General may file suit i...
Fair Lending LawsHome Mortgage Disclosure ActHome Mortgage Disclosure Act: enacted in 1975, tohelp enforce federal laws ag...
SummaryFair Lending Laws    l Home Mortgage Disclosure Act    l ECOA    l Consumer credit                  © Copyright 200...
Fair Housing Act RequirementsReasonable accommodationsReasonable accommodations: landlord must makeany reasonable accommod...
Fair Housing Act RequirementsNew multi-family constructionDesign and construction requirements:  l all public and common a...
Americans with Disabilities ActADA requirements (cont.)  l provision of auxiliary aids and services so that    no individu...
California Antidiscrimination LawsCalifornia’s antidiscrimination laws are often muchstricter than federal counterparts.  ...
Fair Employment and Housing ActApplicationFair Employment and Housing Act makes it illegalfor any owner, landlord, assigne...
ApplicationService animalsUnder reasonable accommodation requirement:  l landlord with “no pets allowed” must make    exce...
Fair Employment and Housing ActEnforcementDiscrimination complaints are handled byDepartment of Fair Employment and Housin...
California Antidiscrimination LawsUnruh Civil Rights ActBrokerage firm is business establishment, so it:  l cannot discrim...
Unruh Civil Rights ActExpanded protectionUnruh doesn’t prohibit all discrimination.  l economic discrimination permissible...
California Antidiscrimination LawsHousing Financial Discrimination ActComplaints filed with state Secretary of Business,Tr...
California Antidiscrimination LawsReal Estate License LawReal Estate Commissioner’s regulations forbid realestate licensee...
The Right to SueTestersHousing discrimination case may involve manyplaintiffs/defendants.  l testers: people pretending to...
Antidiscrimination in Real EstateViolations may occur in:  l advertising  l selling or renting real property  l lending  l...
Antidiscrimination in Real EstateAdvertisingTypes of models used in advertising can also leadto charges of discrimination....
Antidiscrimination in Real EstateZoningExclusionary zoning: zoning that prohibits orunreasonably restricts permits for mul...
SummaryAntidiscrimination in Real Estate   l Exclusionary zoning   l Disparate impact              © Copyright 2007 Rockwe...
Legal Aspects of Real Estate                                   Lesson 19 Cumulative Quiz1. The 1866 Civil Rights act appli...
7. A real estate agent telling owners that an influx of minorities will adversely affect the schools in theneighborhood is...
13. Modifications under the Americans with Disabilities Act must be:    A.   made regardless of expense    B.   made if re...
20. Which of the following is not a public accommodation under the ADA?    A.   The home office of a school teacher    B. ...
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Transcript of "Rockwell publishing real estate law chapter 19"

  1. 1. Printable Lesson Materials Print these materials as a study guide These printable materials allow you to study away from your computer, which many students find beneficial. These materials consist of two parts: graphic summaries of the content and a multiple choice quiz. Graphic Summaries This portion of your printable materials consists of dozens of frames that summarize the content in this lesson. The frames are arranged on the page to make it easy for you to study the material and add your own notes from your textbook or the online course. Quizzes Many students learn best from sets of questions, and this multiple choice quiz allows you to focus your review of the material to important topics. 13218 NE 20th Street Bellevue, WA 98005 425-747-7272 800-221-9347 www.rockwellinstitute.com© 2009 Rockwell Institute
  2. 2. California Real Estate Law Lesson 19: Civil Rights and Fair Housing Laws © Copyright 2007 Rockwell Publishing, Inc.IntroductionThis lesson will discuss: l state action vs. private action l federal antidiscrimination laws l California antidiscrimination laws l the right to sue l antidiscrimination law and the real estate profession © Copyright 2007 Rockwell Publishing, Inc.State Action vs. Private ActionEarliest civil rights laws were originally interpretedto require state action.State action: action by federal, state, or localgovernment officials or entities © Copyright 2007 Rockwell Publishing, Inc. 1
  3. 3. State Action vs. Private ActionDiscriminatory state action includes: l discriminatory laws and regulations l discriminatory enforcement of the law by courts l court orders to enforce discriminatory private covenants or restrictions © Copyright 2007 Rockwell Publishing, Inc.State Action vs. Private ActionSince 1960s, legislatures and courts haveexpanded antidiscrimination laws. l now prohibit discriminatory action by private parties as well as the stateThis includes real estate agents. © Copyright 2007 Rockwell Publishing, Inc.Federal Antidiscrimination LawsFederal antidiscrimination laws began withThirteenth and Fourteenth Amendments to theConstitution. l passed after Civil War l abolished slavery l guaranteed equal protection under the law © Copyright 2007 Rockwell Publishing, Inc. 2
  4. 4. Federal Antidiscrimination LawsCongress later passed: l Civil Rights Act of 1866 l Title VIII of the Civil Rights Act of 1968 (Fair Housing Act) l Equal Credit Opportunity Act l Home Mortgage Disclosure Act l Americans with Disabilities ActAll contain provisions prohibiting discrimination inreal estate transactions. © Copyright 2007 Rockwell Publishing, Inc.Federal Antidiscrimination LawsKeep in mind that California has its ownantidiscrimination laws. l some are more strict than federal l stricter law will apply © Copyright 2007 Rockwell Publishing, Inc.Federal Antidiscrimination LawsCivil Rights Act of 1866Civil Rights Act of 1866: prohibits discriminationbased on race or color, giving all citizens of theUnited States the same rights to own and enjoyproperty as those held by white persons l applies to all real estate transactions l without exception © Copyright 2007 Rockwell Publishing, Inc. 3
  5. 5. Federal Antidiscrimination LawsCivil Rights Act of 1866Constitutionality of act challenged and upheld in1968 landmark case: Jones v. Alfred H. Mayer Co. l soon after passage Civil Rights Act of 1968Jones established three important points. © Copyright 2007 Rockwell Publishing, Inc.Federal Antidiscrimination LawsCivil Rights Act of 18661. The right to buy or to lease property can be hindered just as much by private citizens as by government. l 1866 Act prohibits all racial discrimination l not just discrimination by state action © Copyright 2007 Rockwell Publishing, Inc.Federal Antidiscrimination LawsCivil Rights Act of 18662. Congress has power to enforce Thirteenth Amendment (abolishing slavery) using “appropriate legislation.” l 1866 Act addresses one of the “badges of slavery” (inability to own property) l 1866 Act is therefore appropriate legislation © Copyright 2007 Rockwell Publishing, Inc. 4
  6. 6. Federal Antidiscrimination LawsCivil Rights Act of 18663. 1866 Act is supplemented by—not replaced by—Civil Rights Act of 1968. © Copyright 2007 Rockwell Publishing, Inc.Civil Rights Act of 1866EnforcementPerson discriminated against in violation of 1866Act may: l bring lawsuit in federal court l be entitled to injunctive relief, actual damages, punitive damages © Copyright 2007 Rockwell Publishing, Inc.SummaryFederal Antidiscrimination Laws l State action l Civil Rights Act of 1866 l “Appropriate legislation” l “Badge of slavery” © Copyright 2007 Rockwell Publishing, Inc. 5
  7. 7. Federal Antidiscrimination LawsFederal Fair Housing ActTitle VIII of the Civil Rights Act of 1968: prohibitsdiscriminatory practices related to housing l also known as Federal Fair Housing Act l prohibits discrimination on the basis of race, color, national origin, religion, sex, handicap, and familial status (protected classes)Familial status: families with minor children © Copyright 2007 Rockwell Publishing, Inc.Federal Antidiscrimination LawsFederal Fair Housing ActFederal Fair Housing Act also prohibitsdiscrimination in: l advertising l lending l real estate brokerage l certain other services connected with residential transactions © Copyright 2007 Rockwell Publishing, Inc.Federal Fair Housing ActApplicationFederal Fair Housing Act covers most sales,rentals, or exchanges of residential property that: l involves buildings or portions of buildings, or l is intended to be occupied as a residenceAlso includes vacant land, offered for sale or lease,that will be site of residential building. © Copyright 2007 Rockwell Publishing, Inc. 6
  8. 8. Federal Fair Housing ActFair Housing Act exemptionsExemptions include: l sale or rental by private owner l rental in an owner-occupied dwelling l sale or rental by religious organization or private club l housing for older persons © Copyright 2007 Rockwell Publishing, Inc.Fair Housing Act ExemptionsSale or rental by private ownerLaw doesn’t apply when private individual sells orrents single-family home, as long as: l owner has less than four homes l no discriminatory advertising used l no real estate broker involvedExemption available only once every 24 months. © Copyright 2007 Rockwell Publishing, Inc.Fair Housing Act ExemptionsRental in owner-occupied dwellingLaw doesn’t apply to rental of room or unit indwelling with up to four units, as long as: l owner lives in one unit l no discriminatory advertising used l no real estate broker involved © Copyright 2007 Rockwell Publishing, Inc. 7
  9. 9. Fair Housing Act ExemptionsReligious organizations and private clubsReligious organization or private club may limitaccommodations to own members, as long as: l providing accommodations is incidental to its primary purposeExemption unavailable if membership is restrictedbased on race, color, or national origin.Exemption doesn’t apply to commercialtransactions. © Copyright 2007 Rockwell Publishing, Inc.Fair Housing Act ExemptionsHousing for older personsChildren may be excluded from housing expresslydesignated for elderly if housing is: l developed or provided through program to assist elderly, l intended for and occupied only by people over the age of 62, or l designed and developed to meet needs of people 55 or older and at least 80% of units occupied by at least one person 55 or older. © Copyright 2007 Rockwell Publishing, Inc.Federal Fair Housing ActProhibited actsFederal Fair Housing Act makes it unlawful toengage in certain acts if based on race, color,religion, sex, familial status, national origin.Prohibited acts include: l refusing to sell or rent after making of bona fide offer, refusing to negotiate, or making unavailable or denying a dwelling l discriminating against any person in terms, conditions, privileges of sale or rental, or in provision of services or facilities in connection with dwelling © Copyright 2007 Rockwell Publishing, Inc. 8
  10. 10. Federal Fair Housing ActProhibited acts (cont.) l making, printing, publishing any notice, statement, or advertising that indicates a preference, limitation, or discrimination in sale or rental l representing that dwelling is not available when it is l blockbusting © Copyright 2007 Rockwell Publishing, Inc.Federal Fair Housing ActProhibited acts (cont.) l discriminating in making of loan for buying, building, repairing, improving, or maintaining a dwelling l denying access to multiple listing service, or discrimination in terms or conditions for access l coercing, threatening, interfering with anyone attempting to enjoy rights granted by Fair Housing Act © Copyright 2007 Rockwell Publishing, Inc.Prohibited ActsRedliningRedlining: refusal to make a loan based on racial orethnic composition of neighborhood in whichproperty is located l occurs when lenders assume property values in minority-owned neighborhoods will decline l loan refusals must be based on purely objective economic criteria © Copyright 2007 Rockwell Publishing, Inc. 9
  11. 11. Prohibited ActsSteeringSteering: channeling prospective buyers or rentersinto specific neighborhoods based on race or someother protected classExample: agent showing white client homes only inwhite neighborhoods © Copyright 2007 Rockwell Publishing, Inc.Prohibited ActsBlockbustingBlockbusting: agent tries to convince owners to sellby creating impression that neighborhood isdeclining due to influx of minority ownersAgent predicts: l lower property values l higher crime rates l decline in school qualityResult: owners panic and list properties with agent,who profits from resulting sales © Copyright 2007 Rockwell Publishing, Inc.Federal Fair Housing ActEnforcementA person who has been discriminated against inviolation of Fair Housing Act may file complaint withOffice of Fair Housing and Equal Opportunity (partof HUD). l must file within one year of incident l HUD may file complaint on own initiative © Copyright 2007 Rockwell Publishing, Inc. 10
  12. 12. Federal Fair Housing ActEnforcementHUD will investigate complaint and attempt tonegotiate agreement.If unsuccessful, dispute may be resolved by l HUD l federal courtHUD may also refer discrimination complaints tostate agency. © Copyright 2007 Rockwell Publishing, Inc.Federal Fair Housing ActEnforcementIndividual also has option to file lawsuit directly, infederal or state court. l suit must be filed within two years of incident © Copyright 2007 Rockwell Publishing, Inc.Federal Fair Housing ActEnforcementFair Housing Act penalties include: l compensatory damages l injunctions l civil penalties ($16,000 for first offense, up to $65,000 for third offense)Fair Housing Act is enforced by U.S. AttorneyGeneral. © Copyright 2007 Rockwell Publishing, Inc. 11
  13. 13. Federal Fair Housing ActEnforcementFor continuing acts, or for issue of publicimportance, Attorney General may file suit in federalcourt, seeking: l temporary injunctions l permanent injunctions l civil penalties ($55,000 for first violation, up to $110,000 for third violation) © Copyright 2007 Rockwell Publishing, Inc.SummaryFederal Fair Housing Act l Title VIII of Civil Rights Act of 1968 l Protected class l Redlining l Steering l Blockbusting © Copyright 2007 Rockwell Publishing, Inc.Federal Antidiscrimination LawsFair lending lawsIn addition to federal Fair Housing Act, other lawsprohibiting discrimination in lending include: l Home Mortgage Disclosure Act l Equal Credit Opportunity Act (ECOA) © Copyright 2007 Rockwell Publishing, Inc. 12
  14. 14. Fair Lending LawsHome Mortgage Disclosure ActHome Mortgage Disclosure Act: enacted in 1975, tohelp enforce federal laws against redliningAct requires institutional lenders to report annuallyon loans they make or purchase each year. l Government investigators look for areas where few or no loans made, and check for discriminatory practices. © Copyright 2007 Rockwell Publishing, Inc.Fair Lending LawsECOAEqual Credit Opportunity Act (ECOA): passed in1974, intended to provide consumers with equalaccess to creditLaw prohibits lender from discriminating againstpotential borrower based on race, color, religion,national origin, sex, marital status, age, or incomefrom public assistance. © Copyright 2007 Rockwell Publishing, Inc.Fair Lending LawsECOAApplies to: l all residential real estate loans l all consumer credit transactionsConsumer credit: credit given to individuals forpersonal, family, or household purposes © Copyright 2007 Rockwell Publishing, Inc. 13
  15. 15. SummaryFair Lending Laws l Home Mortgage Disclosure Act l ECOA l Consumer credit © Copyright 2007 Rockwell Publishing, Inc.Federal Antidiscrimination LawsEqual access to facilitiesFederal laws now include handicapped persons asprotected class. l Federal Fair Housing act amended in 1988 to prevent housing discrimination l Americans with Disabilities Act (ADA): effective in 1992, prohibits discrimination on basis of handicap in any business or facility open to public © Copyright 2007 Rockwell Publishing, Inc.Equal Access to FacilitiesFair Housing Act requirementsFair Housing Act prohibits discrimination: l in terms, conditions, privileges of sale or rental of housing, or l in provision of services or facilities related to housingRequires landlord to permit reasonableaccommodations or modifications that handicappedperson needs to be able to use and enjoy housingunit. © Copyright 2007 Rockwell Publishing, Inc. 14
  16. 16. Fair Housing Act RequirementsReasonable accommodationsReasonable accommodations: landlord must makeany reasonable accommodations to rules, policies,practices, and services if needed by handicappedperson to use and enjoy housing unitApplies to: l public and common areas l individual units © Copyright 2007 Rockwell Publishing, Inc.Fair Housing Act RequirementsReasonable accommodationsReasonable modifications: landlord must allowhandicapped person to make reasonablemodifications to existing housing if modifications arenecessary for full enjoyment l Landlord can require tenant to pay for modifications. l Landlord can require tenant to return premises to original condition if it’s reasonable to do so. © Copyright 2007 Rockwell Publishing, Inc.Fair Housing Act RequirementsNew multi-family constructionCertain design and construction requirements formulti-family dwellings (four or more residential units)built after 1991.Applies to: l ground floor units in buildings with no elevators l all units in building with elevators © Copyright 2007 Rockwell Publishing, Inc. 15
  17. 17. Fair Housing Act RequirementsNew multi-family constructionDesign and construction requirements: l all public and common areas must be accessible and usable l doors must be wide enough for wheelchairs l light switches, outlets, thermostats must be accessible l bathroom wall reinforced, to allow for installation of grab bars l kitchens and bathrooms designed so wheelchair can maneuver about the space © Copyright 2007 Rockwell Publishing, Inc.Equal Access to FacilitiesAmericans with Disabilities ActADA prohibits discrimination on basis of disability inany place of public accommodation.Disability: any physical or mental impairment thatsubstantially limits one or more of the individual’smajor life activitiesPublic accommodation: any private entity that owns,operates, or leases a place open to the public, aslong as the operation of the facility affectscommerce © Copyright 2007 Rockwell Publishing, Inc.Americans with Disabilities ActADA requirementsADA requires each of following to be accomplished,if readily achievable: l modifications in policies, practices, and procedures to make goods and services accessible l removal of architectural, structural communication, or transportation barriers so that goods and services are accessible © Copyright 2007 Rockwell Publishing, Inc. 16
  18. 18. Americans with Disabilities ActADA requirements (cont.) l provision of auxiliary aids and services so that no individual excluded, denied services, segregated, or otherwise treated differently than others l new commercial construction must be accessible unless structurally impossibleReadily achievable: action that can be easilyaccomplished without much difficulty or expense © Copyright 2007 Rockwell Publishing, Inc.Americans with Disabilities ActEnforcementIndividual discriminated against may: l bring civil action l obtain temporary or permanent injunction or restraining order l file complaint with U.S. Attorney General © Copyright 2007 Rockwell Publishing, Inc.SummaryEqual Access to Facilities l Americans with Disabilities Act l Reasonable modifications l Disability l Public accommodation l Readily achievable © Copyright 2007 Rockwell Publishing, Inc. 17
  19. 19. California Antidiscrimination LawsCalifornia’s antidiscrimination laws are often muchstricter than federal counterparts. l include broader range of protected classes l allow few, if any, exemptions © Copyright 2007 Rockwell Publishing, Inc.California Antidiscrimination LawsState laws designed to prohibit discrimination andpromote fair housing include: l Fair Employment and Housing Act l Unruh Civil Rights Act l Housing Financial Discrimination Act l Real Estate Law © Copyright 2007 Rockwell Publishing, Inc.California Antidiscrimination LawsFair Employment and Housing ActFair Employment and Housing Act: passed in 1963,prohibits discrimination in the sale or lease ofhousing in California l also known as “Rumford Act” l protects more classes than federal Fair Housing Act l fewer exemptions than federal Fair Housing Act © Copyright 2007 Rockwell Publishing, Inc. 18
  20. 20. Fair Employment and Housing ActApplicationFair Employment and Housing Act makes it illegalfor any owner, landlord, assignee, managing agent,real estate broker or salesperson, or any businessestablishment to discriminate based on: l race, color, religion, sex, sexual orientation, marital status, national origin, ancestry, familial status, source of income, or disability © Copyright 2007 Rockwell Publishing, Inc.Fair Employment and Housing ActApplicationLaw also prohibits: l use of discriminatory terms when advertising housing l discrimination in financing l seller/landlord from even asking about protected class (if licensee is asked such a question, he should refuse to answer) © Copyright 2007 Rockwell Publishing, Inc.ApplicationReasonable accommodationsLandlords: l required to make reasonable accommodations or modifications l may ask for medical verification of disability and need © Copyright 2007 Rockwell Publishing, Inc. 19
  21. 21. ApplicationService animalsUnder reasonable accommodation requirement: l landlord with “no pets allowed” must make exception for service/companion animal l no extra fees for animal l tenant liable for any damage caused by animal l same rule applies to people who train service animals © Copyright 2007 Rockwell Publishing, Inc.ApplicationService animalsIn California, animal doesn’t need to be trained asservice animal to qualify as reasonableaccommodation. l animals prescribed as “companion animals” for mental illness/depression © Copyright 2007 Rockwell Publishing, Inc.Fair Employment and Housing ActExemptionsFair Employment and Housing Act doesn’t apply: l to accommodations operated by nonprofit religious, fraternal, or charitable organizations l when a portion of a single-family owner- occupied home is rented out l to housing for the elderly (familial status rules only) © Copyright 2007 Rockwell Publishing, Inc. 20
  22. 22. Fair Employment and Housing ActEnforcementDiscrimination complaints are handled byDepartment of Fair Employment and Housing.Options: l hearing by Department l case heard in superior court © Copyright 2007 Rockwell Publishing, Inc.Fair Employment and Housing ActEnforcementIf found guilty, violator may be ordered to: l sell or lease housing in question to injured party l provide financial assistance or benefits previously denied l pay actual damages l pay civil penalty ($10,000 for first offense, up to $50,000 for third offense)Superior court may order punitive damages insteadof civil penalty. © Copyright 2007 Rockwell Publishing, Inc.California Antidiscrimination LawsUnruh Civil Rights ActUnruh Civil Rights Act: prohibits discrimination bybusiness establishments: l based on sex, race, color, religion, ancestry, national origin, disability, medical condition, marital status, or sexual orientationBusiness establishments also prohibited fromdiscriminating in housing transactions based onage. © Copyright 2007 Rockwell Publishing, Inc. 21
  23. 23. California Antidiscrimination LawsUnruh Civil Rights ActBrokerage firm is business establishment, so it: l cannot discriminate in performance of duties l cannot refuse listing or turn away prospective buyer for discriminatory reasons © Copyright 2007 Rockwell Publishing, Inc.California Antidiscrimination LawsUnruh Civil Rights ActAlso included as business establishments: l apartment houses l homeowners and condominium owners associations l other real estate developments © Copyright 2007 Rockwell Publishing, Inc.Unruh Civil Rights ActExpanded protectionCourts have interpreted Unruh Act’s list of protectedclasses as “illustrative rather than restrictive.” l all arbitrary discrimination prohibitedArbitrary discrimination: based on individualcharacteristics, traits, or beliefs similar to thoselisted in the actExample: families with children are protected classeven though not mentioned in statute © Copyright 2007 Rockwell Publishing, Inc. 22
  24. 24. Unruh Civil Rights ActExpanded protectionUnruh doesn’t prohibit all discrimination. l economic discrimination permissible, as long as it applies to everyone equally © Copyright 2007 Rockwell Publishing, Inc.California Antidiscrimination LawsHousing Financial Discrimination ActHousing Financial Discrimination Act: it’s againstpublic policy to deny mortgage loans (or imposestricter terms) based on neighborhood conditionsthat are unrelated to borrower’s creditworthiness orto security property’s value l also known as the “Holden Act” l targets redlining © Copyright 2007 Rockwell Publishing, Inc.California Antidiscrimination LawsHousing Financial Discrimination ActHolden Act makes it illegal to: l discriminate in providing financial assistance to purchase, construct, rehabilitate, improve, or refinance housing on basis of neighborhood characteristics l consider the racial, ethnic, religious, or national origin composition of neighborhood l discriminate in providing financial assistance for housing on the basis of race, color, religion, sex, marital status, national origin, ancestry © Copyright 2007 Rockwell Publishing, Inc. 23
  25. 25. California Antidiscrimination LawsHousing Financial Discrimination ActComplaints filed with state Secretary of Business,Transportation, and Housing.Violator may have to: l make the loan l pay damages © Copyright 2007 Rockwell Publishing, Inc.California Antidiscrimination LawsReal Estate License LawReal estate licensees also need to be aware ofantidiscrimation provisions in: l Real Estate Law l Real Estate Commissioner’s regulations © Copyright 2007 Rockwell Publishing, Inc.California Antidiscrimination LawsReal Estate License LawUnder the Real Estate Law, discriminatory actioncan result in: l discipline from Department of Real Estate l sanctions including license suspension, revocation © Copyright 2007 Rockwell Publishing, Inc. 24
  26. 26. California Antidiscrimination LawsReal Estate License LawReal Estate Commissioner’s regulations forbid realestate licensees from discriminating on basis of: l race, color, sex, religion, ancestry, physical handicap, marital status, national origin © Copyright 2007 Rockwell Publishing, Inc.California Antidiscrimination LawsReal Estate License LawExamples of prohibited real estate actions (ifactions involve discrimination) include: l refusing to negotiate l refusing or failing to show, rent, sell, or finance l providing different services l representing to any person that property is not available, when it is l etc. © Copyright 2007 Rockwell Publishing, Inc.California Antidiscrimination LawsReal Estate License LawReal estate licensees have affirmative duty tofamiliarize themselves with laws.Brokers have duty to supervise licensees © Copyright 2007 Rockwell Publishing, Inc. 25
  27. 27. The Right to SueTestersHousing discrimination case may involve manyplaintiffs/defendants. l testers: people pretending to be housing applicants; used to help prove fair housing law violationsSandwich test: l white tester asks to see available housing l followed by minority tester l followed by another white tester © Copyright 2007 Rockwell Publishing, Inc.The Right to SueTestersIf white testers are shown units, but minority testertold none available ? sufficient evidence to provediscriminationExample: African-American man claims racialdiscrimination in apartment complex; fair housingorganization sends testers who use sandwich test © Copyright 2007 Rockwell Publishing, Inc.SummaryCalifornia Antidiscrimination Laws l Rumford Act l Unruh Civil Rights Act l Arbitrary discrimination l Housing Financial Discrimination Act l Testers and sandwich test © Copyright 2007 Rockwell Publishing, Inc. 26
  28. 28. Antidiscrimination in Real EstateViolations may occur in: l advertising l selling or renting real property l lending l zoning and other regulatory actions l brokers’ employment/business practices l MLS membership and practices © Copyright 2007 Rockwell Publishing, Inc.Antidiscrimination in Real EstateAdvertisingIllegal under both federal and state law to useadvertising that indicates preference, restriction, orintent to discriminate. l even unintentional discrimination may be violationExample: flyer describing a house as “Near localchurch and synagogue” may seem to indicate thatMuslims are unwelcome © Copyright 2007 Rockwell Publishing, Inc.Antidiscrimination in Real EstateAdvertisingSolicitations for potential buyers may havediscriminatory effect if: l solicitations used only in neighborhoods with residents of one race/religion/ethnicity l persons in neighborhood of particular race/religion/ethnicity aren’t sent copies l solicitation suggests recipient can control type/character of person who will buy property © Copyright 2007 Rockwell Publishing, Inc. 27
  29. 29. Antidiscrimination in Real EstateAdvertisingTypes of models used in advertising can also leadto charges of discrimination. © Copyright 2007 Rockwell Publishing, Inc.Antidiscrimination in Real EstateSelling and rentingRefusing to sell, rent, or negotiate is prohibited ifmembership in protected class is factor in decision l includes straightforward refusal l includes refusing to answer doorExample: apartment manager whose peepholeshows front door, refuses to answer if minorityapplicant rings bell © Copyright 2007 Rockwell Publishing, Inc.Antidiscrimination in Real EstateLendingDiscriminatory lending practices include: l redlining l using different foreclosure procedures for different parties l using discriminatory criteria when determining application fees or finance charges © Copyright 2007 Rockwell Publishing, Inc. 28
  30. 30. Antidiscrimination in Real EstateZoningExclusionary zoning: zoning that prohibits orunreasonably restricts permits for multi-family orlow -income family housingSuch zoning impacts some classes more thanothers (disparate impact).Disparate impact: even though ordinance orregulation appears to be neutral, its effect isdiscriminatory because impact falls on oneparticular class more than others © Copyright 2007 Rockwell Publishing, Inc.Antidiscrimination in Real EstateEmployment by brokersBroker may not discriminate in: l hiring sales associates l determining commission splits l assigning work l determining other terms and conditions of employment © Copyright 2007 Rockwell Publishing, Inc.Antidiscrimination in Real EstateMLS practicesDiscrimination charges may result from l denial of access © Copyright 2007 Rockwell Publishing, Inc. 29
  31. 31. SummaryAntidiscrimination in Real Estate l Exclusionary zoning l Disparate impact © Copyright 2007 Rockwell Publishing, Inc. 30
  32. 32. Legal Aspects of Real Estate Lesson 19 Cumulative Quiz1. The 1866 Civil Rights act applies to discrimination based on: A. race B. familial status C. handicap D. gender2. Which of the following is not an example of state action? A. A zoning ordinance passed by a city council B. Enforcement of noise regulations by a police officer C. Court enforcement of private restrictions in a deed D. Public advertising by a real estate agent3. Which of the following is not available as a remedy when a plaintiff wins a discrimination suit underthe Fair Housing Act? A. Jail time for the offending party B. An injunction C. Compensatory damages D. Civil penalties4. Under the Fair Housing Act, religious organizations may limit occupancy to their own members,provided membership isnt restricted on the basis of: A. race B. gender C. national origin D. Both A and C5. The refusal to make loans in certain neighborhoods for discriminatory reasons is called: A. panic selling B. blockbusting C. redlining D. steering6. Channeling prospective renters into specific neighborhoods based on race is an example of: A. steering B. blockbusting C. panic selling D. public accommodation© 2009 Rockwell Publishing 1
  33. 33. 7. A real estate agent telling owners that an influx of minorities will adversely affect the schools in theneighborhood is an example of: A. blockbusting B. panic selling C. Both of the above D. None of the above8. The Home Mortgage Disclosure Act helps enforce the prohibition against: A. redlining B. blockbusting C. steering D. All of the above9. Title VIII of the Civil Rights Act of 1968 is also known as the: A. Equal Credit Opportunity Act B. Home Mortgage Disclosure Act C. Americans with Disabilities Act D. Fair Housing Act10. In an apartment complex built after 1991, the Fair Housing Act requirements for handicappedaccessibility apply to the: A. individual living areas B. common use areas C. public areas D. All of the above11. Under the Fair Housing Act, someone who has been discriminated against may: A. file a complaint with the Office of Equal Opportunity B. file a lawsuit in federal court C. file a lawsuit in state court D. All of the above12. The Equal Credit Opportunity Act applies to: A. real estate loans only B. consumer credit C. consumer and commercial credit D. all consumer credit excluding real estate loans© 2009 Rockwell Publishing 2
  34. 34. 13. Modifications under the Americans with Disabilities Act must be: A. made regardless of expense B. made if readily achievable C. made in all places of public accommodation D. Both B and C14. Which California law prohibits discrimination by business establishments generally? A. Fair Employment and Housing Act B. Housing Financial Discrimination Act C. Unruh Civil Rights Act D. Real estate license law15. The Unruh Civil Rights Act does not prohibit: A. arbitrary discrimination B. discrimination based on sexual orientation C. discrimination based on financial status D. racial discrimination16. Compared to the federal Fair Housing Act, Californias Fair Employment and Housing Act contains: A. a narrower range of protected classes and fewer exemptions B. a wider range of protected classes and fewer exemptions C. a narrower range of protected classes and more exemptions D. a wider range of protected classes and more exemptions17. Zoning practices that restrict multi-family houses may be considered: A. restrictive B. disparate C. exclusionary D. unaccommodating18. Californias real estate license law: A. does not address discrimination B. allows an affiliated licensee to follow instructions from her broker that result in discrimination C. prohibits assisting in a transaction if the agent believes her client intends to discriminate D. states that any discrimination will result in automatic license suspension19. A common method of proving fair housing violations is through the: A. disparate impact test B. exclusionary zone test C. sandwich test D. reasonable accommodation test© 2009 Rockwell Publishing 3
  35. 35. 20. Which of the following is not a public accommodation under the ADA? A. The home office of a school teacher B. The office of the local credit union C. A real estate office D. A property management office with only one employee© 2009 Rockwell Publishing 4

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