FRANKLIN HOME OWNERS ASSOCIATION SETTLES DISABILITY DISCRIMINATION LAWSUIT FOR $156,000

NASHVILLE -- The Chestnut Bend Home Owners Association (CBHOA) in Franklin, Tenn., has settled a federal lawsuit filed against it in early 2012 for $156,000.

The Plaintiffs, Charles and Melanie Hollis and their youngest two children, both of whom have Down Syndrome, filed the suit on Feb. 2, 2012, with Larry Crain of Crain, Schuette & Associates, a Brentwood law firm, and Tracey McCartney, Executive Director of the Tennessee Fair Housing Council, representing them. Meagan Dolleris, the Council’s staff attorney, also assisted in the litigation.

The suit alleged that, throughout most of 2011, the CBHOA’s Architectural Review Committee (ARC) refused to allow the Hollis family to create a sun room to be used as a therapeutic area for the young children to receive physical therapy and to play in a safe environment, either because they disagreed with the family’s design choices or deemed the applications incomplete. Because of the manifestations of the children’s disabilities, the Hollises needed the sun room to house therapy equipment for stimulation and development.

In the fall of 2011, the Hollises approached the Tennessee Fair Housing Council’s executive director, Tracey McCartney, for assistance. McCartney contacted the ARC through a representative of CBHOA’s management company, Westwood Property Management LLC, and asked for a list of acceptable construction materials for the sunroom project so that she could assist the family in submitting a new proposal and educating the ARC and CBHOA on the requirements of the Fair Housing Act. The Act makes it illegal to refuse to permit reasonable modifications of existing premises if such modifications may be necessary to afford a person with disabilities full enjoyment of the home.

In its final request for approval, the Hollises asked to construct a sun room that would match that of a neighbor, which had a metal roof, and the ARC had previously indicated in writing that a metal roof would be acceptable. However, after McCartney submitted the proposal in early December 2011 for a sun room with a metal roof, the ARC, via its attorney, responded that “(t)he subdivision standard roof is shingle and not metal. Although metal roofs are in vogue right now the ARC prefers not to approve a metal roof.”

The letter also conditioned the sunroom approval process on the Hollises providing a written assurance that “the exercise equipment would be placed and maintained in the sunroom and not moved outside without further application to the ARC.” That assurance was not required of others requesting to modify their homes.

The Hollises and McCartney considered that letter a refusal to allow the reasonable modification and gave the ARC until Dec. 22, 2011, to reverse itself. Neither the ARC nor the CBHOA responded. The Hollises, frustrated by the refusal and by their treatment at the hands of the Architectural Review Committee, sold their home at a loss and moved out of the neighborhood. They filed the lawsuit shortly thereafter.

The case has resulted in an important clarification of the Fair Housing Act in the 6th Circuit. The trial court had found that the CBHOA may have failed to permit the reasonable modification but held that the plaintiffs had failed to produce any evidence that the CBHOA’s actions were motivated by discriminatory intent against people with disabilities. The trial judge also held that the Charles and Melanie Hollis did not have the right to sue on their own (as opposed to filing as the parents of the children) because they did not have any damages of their own. As a result, the trial judge dismissed the Hollises’ case.

The Hollises, with the representation of Stephen Dane and Ryan Downer of Relman, Dane and Colfax, a leading Washington, D.C., civil rights firm, appealed the case to the 6th Circuit Court of Appeals, which held that it is not necessary to show discriminatory intent in a reasonable modification case. The 6th Circuit also held that the Hollises had alleged they had been economically harmed by the CBHOA and thus had standing to sue. (The 6th Circuit covers Tennessee, Kentucky, Ohio and Michigan.)

Westwood, a Franklin, Tenn.-based company that provides management services to CBHOA and other home owner associations, was originally named as a defendant in the lawsuit. The plaintiffs agreed to dismiss Westwood in August of 2013 in exchange for its commitment to provide annual fair housing training for its employees, to engage the services of an experienced fair housing lawyer and to develop a fair housing policy. The plaintiffs insisted on these assurances after learning that the company apparently had not been requiring any of its managers to receive training on the Fair Housing Act.

In addition to the payment to the Hollises, the settlement agreement with CBHOA requires it to work only with management companies that have a fair housing policy and whose employees receive annual fair housing training. The CBHOA did not admit wrongdoing as part of the settlement.

The Tennessee Fair Housing Council’s involvement in this litigation was made possible by a grant from the U.S. Department of Housing and Urban Development’s Fair Housing Initiatives Program.