Court Opinion

ID: 9483489
Source: CourtListenerOpinion
Date Created: 2023-08-05 09:21:50.689687+00
Date Added: 2024-06-11T17:49:39.099994
License: Public Domain

OPINION
MURNAGHAN, Circuit Judge:
The present case arises as an appeal by appellant Darlene Walker from a judgment entered in the United States District Court for the Eastern District of Virginia. Walker brought suit against Constance A. Cri-gler, a professional realtor, and against Frank B. Whitesell, the owner of the rental property in question. In her suit, Walker alleged sex discrimination in the rental of housing pursuant to 42 U.S.C. § 3601 et seq. (1988), and sought to recover compensatory and punitive damages.
The jury returned a verdict in favor of Walker against Crigler and ordered the latter to pay $5,000 in compensatory damages, but indicated no punitive damages. Conversely, the jury found for Whitesell and cleared him of all charges and liabilities. Subsequently, appellant filed a motion for a new trial, a motion for judgment notwithstanding the verdict, and submitted new pleadings in support of a request for declaratory and injunctive relief that had remained pending since the conclusion of trial.
On April 1,1991, the district court denied all of appellant’s motions, and refused to order the declaratory or injunctive relief. Walker filed a timely notice of appeal from the district court’s rulings on the issues of denial of judgment n.o.v. and denial of the requested declaratory relief.
I.
Appellant is a single mother with one son. In 1986, she and her son moved to Falls Church, Virginia where appellant was and remains employed with the Central Intelligence Agency. Upon her arrival in Falls Church, appellant rented a pair of rooms in a four bedroom home for her and her son.
In late 1987, appellant’s landlord reclaimed one of the two rooms, and she became interested in finding a new residence. Approximately two years later, in July of 1989, appellant contacted Town and Country Properties to inquire about rental properties in the area. Appellant spoke to Maurice Hill, an agent at Town and Country, who provided her with various property listings taken from the firm’s Multiple Listing Service (“MLS”) computer listings. Appellant viewed two of the properties accompanied by Hill’s assistant John Moore (“Moore”).
On the night of July 27, 1989, appellant and Moore visited a property located at 124 Falls Avenue in Falls Church. Whitesell *902owned the property, and Crigler provided services as the property manager. Cri-gler’s responsibilities included finding financially-qualified tenants for 124 Falls Avenue and other properties owned by White-sell, and keeping Whitesell constantly abreast of developments concerning the properties.1 Crigler did not have the authority to sign leases with potential renters.
The listing in the MLS described the property as “a nice 2BR (two bedroom)” apartment “ideal for two men.” The listing also indicated that the property had “3 guys” as tenants, and that the rent was $600 per month.
In January of 1989, Whitesell, in response to an awareness of housing discrimination suits against landlords, sent Crigler a memorandum which read:
In view of the recent legal action against rental property owners I have been advised by my attorney to submit the following statement:
No one who meets all other qualifications for tenancy on (sic) one of my properties is to be denied the right to rent such properties solely because of discrimination on the basis of race, creed or physical impairment ...
Obviously, this notice includes no provision against gender discrimination, but Crigler contended that the meaning of the letter, that all federally mandated anti-discrimination provisions should be met, was clear.
Appellant was unable to tour the 124 Falls Avenue apartment because there was no key available. But given its location so close both to school for her boy and to transportation to work for herself, she decided that she wanted the apartment, and filled out an application for it with Moore’s assistance.
Later that night or early the next morning, Moore contacted Crigler to tell her that he had an application he wished to present on the Falls Avenue property. Both parties agree that Ms. Crigler inquired about the applicant, but that recollection is the end of their agreement.
Moore testified that he advised Crigler that the applicant was a single mother and that Crigler in no uncertain terms said that she would not rent to appellant because she was a woman. She expressed her policy of not renting to women in any circumstances. Crigler never reached the point of asking about appellant's financial qualifications, but Moore said that he told her that the applicant was financially qualified. Based on that conversation, Moore determined that it would be futile to deliver appellant’s application to Crigler.
Appellant called Crigler after Moore relayed his conversation with the property manager. According to appellant, Crigler told her she would not rent the apartment to a single woman, and that she had experienced problems with the boyfriends of single women in the past. Crigler testified that she never told anyone that she would not rent to appellant because of her gender, but that her expressed rationale was that appellant did not meet the financial requirements set out for the unit. Appellant testified that she asked Crigler if she was speaking on behalf of the owner of the apartment, and Crigler replied that she was. Appellant then related the substance of her conversation to Hill at Town and Country.
Hill subsequently called Crigler and she repeated to him her policy of not renting to women. Between August 10 and October 19, appellant filed various administrative, local and state discrimination suits against the Town and Country officials and Crigler. She did not know who owned the 124 Falls Avenue unit at the time of those suits. On October 5, the unit was finally rented to two men who paid $580 monthly rent, twenty dollars less than appellant had been willing to pay.
On August 9, 1990, appellant filed the present action against Crigler and White-sell alleging discrimination in violation of *903the Fair Housing Act of 1968, 42 U.S.C. § 3601 et seq. (1988). Trial was held on March 5 and 6, 1991.
At trial, Crigler denied that she ever referred to appellant’s gender as the reason for her refusal to rent to her. White-sell made little effort to defend Crigler’s actions and argued that he should not be held liable for her mistakes. At the conclusion of appellant’s case, the court granted Whitesell’s motion to strike appellant’s punitive damages claim against him. Thus the only remaining claims were for punitive and compensatory damages against Crigler and compensatory damages against White-sell.
The jury found for plaintiff in the suit against Crigler, but fully exonerated Whitesell of any responsibility for the discriminatory acts of his employee. The court had instructed the jury that they should find Whitesell liable for damages to appellant if they believed that Crigler, in practicing discrimination against appellant, was an agent of Whitesell, acting within the scope of her employment. The jury ordered compensatory damages of $5,000 to be paid by Crigler.
Following the trial, appellant filed a motion for judgment n.o.v., and for a new trial. In addition, appellant filed a memorandum in support of a request for a declaratory judgment and injunctive relief, requesting that the court enter judgment against Whitesell, arguing that Crigler, as a matter of law, was an agent of Whitesell, and that she had clearly acted within the scope of her authority when she harmed appellant.
On April 1,1991, the district court denied all of appellant’s post-trial motions. Appellant filed a timely notice of appeal. On April 19, Crigler filed a voluntary Chapter 7 bankruptcy petition. On August 9; 1991, appellant received a notice from the Bankruptcy Court indicating that Crigler’s $5,000 debt to her had been discharged.
II.
The denial of a motion for judgment n.o.v. “cannot be disturbed unless, without weighing the evidence and assessing witness credibility, we conclude that reasonable people could have returned a verdict only [for the moving party].” Cooper v. Dyke, 814 F.2d 941, 944 (4th Cir.1987). The denial of a motion for a new trial should be reversed only when abuse of discretion on the part of the trial court is shown in its determination that “[t]he jury’s verdict was not against the clear weight of the evidence.... ” Abasiekong v. City of Shelby, 744 F.2d 1055, 1059 (4th Cir.1984).2
The jury ruled on the case against Whitesell in his favor, holding, apparently, that Crigler was not acting in the scope of her employment when she denied Walker’s attempts to rent the 124 Falls Avenue premises because she was a woman.3 The sole evidence to support the jury’s conclusion that Whitesell was not liable for damages for the discrimination was the evidence indicating that Crigler was instructed not to refuse to rent on discriminatory grounds. In denying the motion for judgment notwithstanding the verdict, the trial judge concluded that the evidence of White-sell’s instruction was sufficient to support the jury’s verdict. We find, however, that the court’s conclusiones based on an erro*904neous theory of law, and that reversal is required. Since there is no unsettled question of fact to be submitted for decision by the jury, it is appropriate to reverse the judgment that Whitesell was not liable for compensatory damages and to direct entry of a verdict and the consequent judgment against Whitesell in Walker’s favor in the amount of $5,000.00. Both parties at oral argument agreed that, should we reverse, that would be the preferable course.
We accept the jury’s finding that White-sell did not confer on Crigler the right to discriminate, or even indicate his intention that she discriminate. The evidence is sufficient to sixpport the conclusion that Whitesell specifically intended that Crigler not discriminate. In many cases, involving issues other than housing discrimination, such a finding would refute the assertion that Crigler had acted within the scope of employment, and would concurrently, shield Whitesell from any liability as principal. However, the arguable conclusion that Crigler acted outside the scope of her employment is irrelevant in the present case, for Whitesell could not insulate himself from liability for sex discrimination in regard to living premises owned by him and managed for his benefit merely by relinquishing the responsibility for preventing such discrimination to another, party.4 Here we adopt the general rule applied by other federal courts that the duty of a property owner not to discriminate in the. leasing or sale of that property is non-delegable.5
The dissent cites regulations which govern the adjudication of fair housing proceedings brought in front of the Department of Housing and Urban Development (“HUD”) to support its proposed rejection of the conclusion that a property owner has a non-delegable duty to prevent discrimination.6 These regulations, as the dissent concedes, do not cover the circumstances of the present case which is a private cause of action and not a complaint filed with HUD.7 The cited regulations do not support rejection of the existing strong line of precedent which, unlike the regulations, does address directly the proper determination of the duty of a property owner in a private housing discrimination cause of action.
We are not unmindful of the arguable incongruity of applying liability to White-sell, and others similarly situated, who are apparently non-culpable in a housing discrimination instance, but must still bear the burden of liability. The central question to be decided in a case such as this, however, is which innocent party, the owner whose agent acted contrary to instruction, or the potential renter who felt the direct harm of the agent’s discriminatory failure to offer the residence for rent, will ultimately bear the burden of the harm caused. It is clear that the overriding societal priority of the provision of “fair housing through out the United States” clearly set out in the Fair Housing Act,8 indicates.that the one innocent party with the power to control the acts of the agent, the owner of the proper*905ty or other responsible superior, must act to compensate the injured party for the harm, and to ensure that similar harm will not occur in the future.9 Just as we feel no qualms in holding a property owner responsible for paying property taxes, meeting health code safety requirements, or ensuring that other responsibilities to protect the public are met, and we refuse to allow the owner to avoid these responsibilities with an assertion that he had conferred the duty to another, we must hold those who benefit from the sale and rental of property to the public to the specific mandates of anti-discrimination law if the goal of equal housing opportunity is to be reached.
Whitesell, despite forbidding discrimination on the part of Crigler, cannot, under the Fair Housing Act, dispose of his duty to prevent sexual discrimination in the renting of 124 Falls Avenue, a property which he owned and which was operated for his benefit.10
There remains for consideration Walker’s request for a declaratory judgment and injunctive relief which would ban rental discrimination violative of 42 U.S.C. § 3601 et seq. (1988) on Whitesell’s and Crigler’s part. Because of our action in requiring entry of a judgment in compensatory damages against Whitesell, we reverse and remand the April 1,1991 order denying Walker’s request for declaratory and injunctive relief. The district court should consider matters bearing on whether injunctive relief is appropriate, considering, inter alia, the end of Crigler’s status in connection with 124 Falls Avenue,-the adequacy of the compensatory damage awards and their stare decisis effect in curbing further breaches of 42 U.S.C. § 3601, et seq. (1988), present management arrangements for the premises, and the like. United States v. Warwick Mobile Homes Estates, 558 F.2d 194, 197 (4th Cir.1977).
REVERSED, JUDGMENT ORDERED.ENTERED, AND REMANDED.

. Crigler’s provision of information for White-sell included a monthly "Management Net Sheet,” which included a statement of the rents paid for the month, and additional "Notes” of interest. The April 1987 sheet included a reference to an advertisement that had been placed in local papers that sought “a male 5'6" for rent at $450 ..."

. "The scope of appellate review of the exercise of ... discretion [to grant or deny a declaratory judgment motion] is not under an 'arbitrary and capricious' standard but allows the appellate court to substitute its judgment for that of the trial court.” Cincinnati Ins. Co. v. Holbrook, 867 F.2d 1330, 1333 (11th Cir.1989). Accordingly, since the standard is more severe for a denial of a j.n.o.v. motion than that for a motion for declaratory judgment, if we find that the district court erred in denying the j.n.o.v. motion, it would be clear that it erred in denying declaratory relief.

. Given the jury’s verdict finding Crigler guilty of discrimination, the jury instructions provided by the trial court as to the relationship between principal and agent and possibilities for joint liability, and the jury’s failure to find Whitesell jointly liable, it is clear that the jury concluded either that Crigler was not an agent of White-sell, which is clearly erroneous given the undisputed nature of the principal/agent relationship, or that Crigler was acting outside the scope of her employment when she violated the Fair Housing Act requirements.

. Though the present case turns on the non-delegable nature of Whitesell’s duty not to discriminate, and not on the question of whether Crigler acted within the scope of her employment, we doubt that the mere act of instructing Crigler not to discriminate would be sufficient to justify a ruling that she was acting outside the scope of employment. "An act, although forbidden, or done in a forbidden manner, may be within the scope of employment.” Restatement of, Agency (Second) § 230 (1958).

. Marr v. Rife, 503 F.2d 735, 741 (6th Cir.1974) ("The discriminatory conduct of an apartment manager or rental agent is, as a general rule, attributable to the owner and property manager of the apartment complex, both under the doctrine of respondeat superior and because the duty to obey the law is non-delegable."); Coates v. Bechtel, 811 F.2d 1045, 1051 (7th Cir.1987); Phiffer v. Proud Parrot Motor Hotel, Inc., 648 F.2d 548, 552 (9th Cir.1980); Saunders v. General Services Corp., 659 F.Supp. 1042, 1059 (E.D.Va.1987) ("Under the Fair Housing Act, a corporation and its officers ‘are responsible for the acts of a subordinate employee ... even though these acts were neither directed nor authorized ....' Courts have followed this rule even where ‘it seems harsh to punish innocent and well-intentioned employers' because the statutory duty not to discriminate is non-delega-ble”) (citations omitted).

. 24 C.F.R. § 103.20 (1991).

. See infra, at 906 (Widener, J., dissenting).

. 42 U.S.C. § 3601.

. It must not be overlooked that although the property owner’s duty to prevent discrimination is non-delegable, the owner will not be subject to liability for the full amount of all successful claims to the extent that contribution from other liable parties may offset some, or all, of the payment for which the owner is responsible. In view of that consideration, the dissent has significantly overstated the meaning of the opinion to be that "[u]nder this rule even the most conscientious and careful property owner, as there was here, will be unable to protect himself from liability resulting from the forbidden acts of unscrupulous agents.” Slip op. at 10 (Widener, J., dissenting). In the great majority of cases we may assume that real estate agents will not turn bankrupt or otherwise judgment proof. They will remain liable for damages flowing from flaunting a principal's intentions. Restatement of Agency (Second) § 383, Comment (e) ("The agent may be subject to liability to his principal because he has ... committed a tort or a crime upon a third person for which the principal is liable.”).

. Given the minimal supervisory activity on the part of the owner to ensure that his agent met the requirements of federal fair housing law in the present case, we do not have occasion to address the question of whether a heightened level of supervisory activity on the part of a property owner could constitute reasonable fulfillment of his duty not to discriminate, shielding him from liability for discrimination carried out by an agent acting contrary to a specific non-discrimination program instituted by the owner.