August 30, 2018 Practice Points

Do-Nothing Landlords Can Be Liable for Known Tenant-On-Tenant Harassment Under Federal Housing Act

Following Wetzel v. Glen St. Andrew Living Community, landlords must take reasonable steps to stop harassment based on protected status.

By Jeffrey B. Greenspan

The Seventh Circuit recently held that in addition to creating liability when a landlord intentionally discriminates against a tenant based on a protected characteristic, the Federal Housing Act (FHA), 42 U.S.C. §§ 3601–3619, also creates liability against a landlord that has actual notice of tenant-on-tenant harassment based on a protected status but chooses not to take any reasonable steps within its control to stop the harassment.

In Wetzel v. Glen St. Andrew Living Community, LLC, et al., Case No. 17-1322, 2018 WL 4057365 (7th Cir. Aug. 27, 2018), Marsha Wetzel alleged that after moving into Glen St. Andrew Living Community, she was subjected to physical and verbal abuse from other tenants because she is openly lesbian. Wetzel alleged that she routinely reported the abuse to St. Andrew’s staff, but they her told not to worry about the harassment, dismissed the conduct as accidental, denied Wetzel’s accounts, and branded her a liar. Wetzel also asserted that St. Andrews took affirmative steps to retaliate against her for her complaints, relegating her to a less desirable dining room location, barring her from the lobby except to get coffee, and halting her cleaning services.

Wetzel filed suit in the United States District Court for the Northern District of Illinois alleging St. Andrew failed to ensure a non-discriminatory living environment and retaliated against her for complaining about sex-based harassment, each in violation of the FHA. St. Andrew and the other defendants moved for dismissal, contending that the FHA does not make a landlord accountable for failing to stop tenant-on-tenant harassment unless the landlord’s inaction was animated by discriminatory animus. They also contended that Wetzel’s retaliation claim failed because it lacked an allegation that the defendants were motivated by discriminatory animus.  The district court agreed with the defendant’s arguments and dismissed both the harassment claim and retaliation claim.

The appellate court reversed. Citing one of their previous decisions, the court stated that discrimination based on sexual orientation qualifies as discrimination based on sex under Title VII and applies with equal force under the FHA. It also determined that Wetzel’s allegations demonstrated that the harassment she allegedly suffered was severe or pervasive enough to interfere with her enjoyment of her dwelling.  

The court then analyzed whether there was a basis to impute liability to St. Andrew for the hostile housing environment under the FHA. Acknowledging that the text of the FHA does not spell out a test for landlord liability, the court found that both Title VII (which governs discrimination in employment) and Title IX of the Education Amendments of 1972 (which is meant to eliminate sex-based discrimination from education) were analogous anti-discrimination statutes, and determined that the Supreme Court’s interpretation of those statutes established that Wetzel’s claim against St. Andrew was covered under the FHA.

The court rejected St. Andrew’s contention that because there is no agency or custodial relationship between a landlord and tenant, it had no duty to protect Wetzel from discriminatory harassment. It made clear that the duty not to discriminate in housing conditions encompasses the duty not to permit known harassment on protected grounds (i.e., common areas of the building). It stated that liability against a landlord attaches when it has available remedial tools that it could apply to deter the harassment, but fails to deploy them. St. Andrew, for instance, could have evicted any tenants that interfered with the peaceful use and enjoyment of the community by other tenants or suspended privileges for tenants who failed to abide by its anti-harassment policies. Instead, St. Andrew allegedly took a “blame-the-victim” approach, subjecting it to liability. The court also found that, contrary to St. Andrew’s contention, the FHA does not require that a plaintiff allege discriminatory animus to state a claim for retaliation. Accordingly, it held that Wetzel had stated both a hostile-housing environment claim and retaliation claim under the FHA.

Jeffrey B. Greenspan is a member at Cozen O’Connor in Chicago, Illinois.