Court Opinion

ID: 6935041
Source: CourtListenerOpinion
Date Created: 2022-07-24 00:27:12.094225+00
Date Added: 2024-06-11T16:07:24.853715
License: Public Domain

HENRY, Circuit Judge,
dissenting.
The majority holds it arbitrary and capricious for the Secretary of Housing and Urban Development to conclude that Mountain Side’s policy had a discriminatory effect upon families with children and that Mountain Side did not meet the “business necessity” exception to the Fair Housing Act (FHA). I must respectfully dissent for three reasons. First, substantial evidence existed for the Secretary to find that Mountain Side’s policy had a discriminatory effect upon families with children. Second, substantial evidence supports the Secretary’s finding that the engineering study was a post-hoc justification for a discriminatory policy that actually does not support Mountain Side’s position because it proposed a solution that would have allowed the family at issue to continue living in the park. Third, I believe that Congress has already determined the balance between the rights of children and others and that it is not the role of this court to determine whether prohibiting discrimination against children may negatively affect the quality of life in multifamily housing.
Before explaining my dissent, I note that the majority assumes in part IV of its opinion what I believe it should acknowledge: Policies that create a disparate impact upon families with children are prima facie discriminatory. See, e.g., Casa Marie, Inc. v. Superior Court, 988 F.2d 252, 269 (1st Cir.1993) (collecting cases); Huntington Branch, NAACP v. Town of Huntington, 844 F.2d 926, 935-36 (2d Cir.) (noting confusion surrounding the prima facie case in housing discrimination matters and holding that disparate impact is sufficient to create a prima facie case), aff'd, 488 U.S. 15, 109 S.Ct. 276, 102 L.Ed.2d 180 (1988) (per curiam); Betsey v. Turtle Creek Assocs., 736 F.2d 983, 986 (4th Cir.1984) (holding that effect alone is sufficient to establish a prima facie ease under the FHA). However, whether one assumes, arguendo, or acknowledges that disparate impact is sufficient to state a prima facie case under the FHA, my view is the same. Five people will be evicted from a home they purchased based upon what I believe to be an erroneous application of the law to the facts of this case.
Statistical Analysis
The majority holds that the Secretary erred by relying upon national statistics. However, without strong evidence showing that the relevant market differs from the national average to such an extent that the three-person limit does not have a disparate impact on families with children, I cannot agree. In my view, the Secretary established a prima facie ease of discrimination through the use of statistical evidence, and Mountain Side failed to rebut that case.
According to the record, national census figures show that between 71% and 97% of United States households with four persons or more have minor children. Rec. vol. II, at 38. On the other hand, less than 12% of households with three persons or fewer have minor children. Secretary’s Second Remand at 7. Unless we suppose that Mountain Side’s market is dramatically different from the national average, it seems clear that its rule limiting occupancy to three-people-per-*1258unit has a disparate impact upon families with minor children.
However, the majority holds that the Secretary must provide a statistical analysis of Jefferson County, Colorado, in order to rely upon disparate impact. I can find no authority for the proposition that the Secretary must explicitly focus upon the county housing market and family statistics when evaluating a housing discrimination claim. In my view, such a position is inconsistent with Congress’s grant of authority to the Secretary, our standard of review, and the approach other courts have taken in the discrimination context. In Dothard v. Rawlinson, 433 U.S. 321, 330, 97 S.Ct. 2720, 2727, 53 L.Ed.2d 786 (1977), the Supreme Court held that when “there was no reason to suppose” a difference between local and national statistics, the district court did not err in using national statistics. In addition, the Ninth Circuit has held that if a plaintiff produces statistical evidence in a Title VII action, “the burden of proof shifts to the employer to prove either that the plaintiffs statistics are inaccurate and no disparity exists, or that the practice is necessary to the efficient operation of the business.” Hung Ping Wang v. Hoffman, 694 F.2d 1146, 1148 (9th Cir.1982) (citing Dothard, 433 U.S. at 338-39, 97 S.Ct. at 2731 (Rehnquist, J., concurring) (other citations omitted)).
Without convincing evidence defining Mountain Side’s market and conclusively showing how that market differs materially from national statistics, I do not believe we are in a position to conclude that the Secretary erred by relying upon census data.
Business Necessity
In addition to holding that the Secretary erred by relying upon the government’s sta-tistieal evidence to find that Mountain Side’s policy had a discriminatory impact upon children under the FHA, the majority holds that the Secretary erred by finding that Mountain Side did not have a business necessity to engage in activities that disparately impacted a protected class.1 I cannot agree.
Prior to 1988, Mountain Side prohibited children from living in its park. In 1988, however, Congress passed legislation preventing landlords from maintaining adults-only properties, except under limited and specific circumstances. Fair Housing Amendments Act of 1988, Pub.L. No. 100-430, §§ 6(b)(1) — (2), 6(d)(2), 102 Stat. 1619, 1622, 1623 (codified at 42 U.S.C. §§ 3604(a)-(e), 3607(b)(1)). During the week before the legislation went into effect, Mountain Side revoked its adults-only policy and instituted a three-person-per-unit limit. After adopting this new policy, and at the suggestion of legal counsel, Mountain Side retained a consultant and initiated its study. Rec. vol. Ill, at 234-35. The study concluded that the existing sewage system could support 916 residents.2 In 1991, however, the park had only 341 residents. In addition to being well below the limit its expert concluded the infrastructure can support, Mountain Side failed to follow its own expert’s advice. The expert suggested a policy that limited occupancy to two-people-per-bedroom in each unit. Under this policy, the family in this case would have been permitted to live in their three-bedroom unit. Mountain Side itself, moreover, argues that larger families do not usually want to live in mobile home parks, thus suggesting that rapid growth is unlikely. Given the timing of the policy change from adults-only to a three-person-per-unit limit, the timing *1259and substance of the sewer study, Mountain Side’s failure to accept its consultant’s recommendation on limiting park population, the fact that the population was well below half of the maximum suggested by the consultant in the study upon which Mountain Side relies, and the lack of evidence of a population explosion, I cannot agree that the Secretary erred by rejecting Mountain Side’s business necessity defense to the occupancy restriction.
Finally, I believe that the majority’s consideration of quality of life at the park is misplaced. Some would argue that the FHA makes an explicit trade-off between the quality of life for children and other citizens. One commentator, for example, suggests that landlords prefer not to provide housing for children, that senior citizens prefer to live in communities without children, and that prohibiting multifamily home providers from discriminating against children may not be socially desirable. See James C. Frooman, Comment, Statutory Analysis of The Familial Status Provision of The Fair Housing Amendments of 1988 — Or, ‘Why Do I Have To Live With Those Curtain-Climbing Rug Rats?”, 17 N.Ky.L.Rev. 215 (1989).3 However, Congress chose to protect children and resolved this question in favor of nondiscrimination.
From the time of Shelley v. Kraemer, 334 U.S. 1, 68 S.Ct. 836, 92 L.Ed. 1161 (1948), the courts have realized that public policy concerns are relevant in housing law. Congress’s desire to prohibit discrimination against children is certainly appropriate in cases of multifamily housing developments that require significant and disproportionate outlays of public resources to provide police, fire, health, and other public services. Congress has recognized that multifamily housing providers who enjoy this public subsidy must meet certain standards in exchange for entering this potentially lucrative market. The FHA seeks to prohibit discrimination against families with children in multifamily housing, and I believe that is an appropriate exercise of congressional power. I would therefore affirm the decision of the Secretary.

. There is no allegation that the occupancy at issue violates any local ordinance.

. It is ironic that the business necessity exception results in such economically inefficient results in this case. If two family members do not move, the family will have to move and sell their home. The park will then have one less tenant and both parties will suffer the transaction costs involved in the dislocation.