Real estate agents need to understand how to respond when a client violates fair housing laws. By acting swiftly to separate yourself from and address the discriminatory behavior, you can not only protect yourself from potential liability, but also help prevent fair housing violations. A pending case in the U.S. District Court in Massachusetts exemplifies these issues, and is a good example of the steps real estate agents should take in these situations.
In Clinton-Brown v. Hardick, the plaintiffs filed suit, alleging violations of the Fair Housing Act and Rhode Island fair housing laws based on defendants’ alleged refusal to sell their property to the plaintiffs based on their race. Although the parties had verbally agreed to the terms of the sale, when the Hardicks received the signed purchase agreement from the Browns and noticed Ms. Clinton-Brown’s first name, “Ebony”, they asked their real estate agent whether Ms. Clinton-Brown was “black.” When their real estate agent confirmed her race, the Hardicks purportedly advised that they would not sell their property to an African American and refused to move forward with the sale.
In response, and according to an affidavit submitted by the Hardicks’ agent, the agent informed the Hardicks that she could not continue discussions with them, and immediately reported the conversation to her broker. The agent subsequently withdrew the listing upon the Hardicks’ request, and ceased all further communication with the Hardicks.
The agent’s decisive and prompt actions in response to the client’s fair housing violations were appropriate and helped shield the agent from liability in the lawsuit. If you find yourself in a similar situation where a client violates the fair housing laws, be sure to follow these best practices:
- Remind clients of their obligations under the Fair Housing Act, and of your policy not to discriminate.
- Discontinue representation of any client who has made a statement or taken an action in violation of fair housing laws.
- Report the situation to your broker.
- Document the situation in writing, including what actions you took in response to your client’s violations.
- If you are unsure whether a client’s actions violate fair housing laws, consult with an attorney.
In addition to these best practices, it’s always a good idea to include a clear statement of your commitment to upholding fair housing laws in your listing agreements and other communications with clients. These efforts, along with a reminder to clients of their own obligations under fair housing laws, will go a long way to not only protecting you from legal liability, but to helping prevent fair housing discrimination.