Baumgardner v. Secretary, U.S. Dept. of Housing and Urban Development on Behalf of Holley

• Decision Date: 31 March 1992
• Docket Number: No. 91-3039,91-3039
• Citation: 960 F.2d 572
• Parties: Thomas C. BAUMGARDNER, Petitioner, v. The SECRETARY, UNITED STATES DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT, on behalf of Blanton B. Holley, Respondent.
• Court: U.S. Court of Appeals — Sixth Circuit

Page 572

960 F.2d 572

115 A.L.R.Fed. 783

Thomas C. BAUMGARDNER, Petitioner, v. The SECRETARY, UNITED STATES DEPARTMENT OF HOUSING AND URBAN

DEVELOPMENT, on behalf of Blanton B. Holley, Respondent.

No. 91-3039.

United States Court of Appeals, Sixth Circuit.

Argued Aug. 8, 1991.

Decided March 31, 1992.

Mark L. Resler, Cincinnati, Ohio (argued and briefed), for Thomas C. Baumgardner, petitioner.

Leslie A. Simon (briefed), Jessica D. Silver (argued), U.S. Dept. of Justice, Civ. Rights Div., Appellate Section, Robert E. Kopp, Dept. of Justice, Appellate Staff, Civ. Div., David H. Enzel, Memmi M. Stubbs, U.S. Dept. of Housing and Urban Development, Washington, D.C., for Secretary, U.S. Dept. of Housing and Urban Development, on behalf of Blanton B. Holley, respondent.

Stephen M. Dane (briefed), Cooper, Straub, Walinski & Cramer, Toledo, Ohio, for National Fair Housing Alliance and Nat. Neighbors and Housing Opportunities Made Equal, Inc., amicus curiae.

Frederick M. Morgan, Jr. (briefed), Montgomery, Rennie & Jonson, Cincinnati, Ohio, for Blanton B. Holley, respondent-intervenor.

Before: JONES and SUHRHEINRICH, Circuit Judges; and WELLFORD, Senior Circuit Judge.

WELLFORD, Senior Circuit Judge.

Blanton B. Holley, who lived in the Walnut Hills area of Cincinnati, Ohio, called a telephone number listed on a rental sign at nearby 2343 Victory Parkway. The rental sign advertised a four-bedroom home owned by petitioner, Thomas C. Baumgardner. Holley talked to Baumgardner in early January, 1989, who gave him information about monthly rental and estimated utility bills. There is some divergence in testimony about the details of the balance of the conversation. Holley's version is that Baumgardner asked about the proposed use of the house and who would be living there with him. Upon being advised that Holley and three male friends planned to live there, Baumgardner inquired whether they were students. Holley testified that he told Baumgardner all were employed adults, whereupon Baumgardner stated, "I'm not interested in renting to males. My past experience has been that males are messy and unclean."

Baumgardner, on the other hand, testified that he had no specific recollection of any such conversation, but did remember a phone call inquiry from a male at about the date and time specified by Holley about the home in question. He claimed that the caller, whose identity he could not recall, would not answer his questions about who would be living in the house or about their employment and that he hung up during the conversation. Baumgardner stated that he was again called later by this "completely uncooperative" male. Baumgardner conceded, however, "I honestly do not recall the bits of what went on in the conversations because I have so many over the phone in any given day." Baumgardner's business was rental or residential real estate units, and he estimated that he received about 20 calls a day but did not keep any detailed records or logs about the contents of these calls from applicants or tenants.

Baumgardner had, in fact, difficulty with males damaging this rental property previously. He personally screened rental applicants at this location, one of about seventy-five or eighty rental housing units he owned and rented on an integrated basis to both males and females. He had also used the 2343 Victory Parkway location as an office from time to time since 1983.

Holley filed a complaint alleging denial of rental accommodation based on his gender (and that of his prospective male roommates) under the Fair Housing Act, 42 U.S.C. § 3601 et seq. Staff of the Department of Housing and Urban Development (HUD) investigated the complaint, following which HUD's general counsel issued a probable cause determination and a formal charge of gender discrimination against Baumgardner in 1990. After a hearing, an administrative law judge (ALJ) issued a lengthy "initial decision" on November 15, 1990, which determined that Baumgardner was guilty as charged of intentional discrimination, assessed $5,000 in actual damages and an additional $4,000 as a civil penalty, and ordered extensive injunctive relief. This appeal ensued. We AFFIRM the determination of liability, but REVERSE on the issues of damages and injunctive relief.

The ALJ determined that Holley called Baumgardner on January 19, 1989, and that he had responded to the inquiry "that he did not want to rent to males because his experience was that they did not keep a clean house." The ALJ found that Holley had invited Baumgardner to come to his "close by apartment" to see that he and his roommates "maintain a clean home," but to no avail. The ALJ also found that Baumgardner "refused to allow" Holley "and his friends an opportunity to inspect the house," stating in response to Holley's persistence that "he was no longer interested in renting the house but would take it off the market." The "For Rent" sign, however, remained in the front yard of the house "for some weeks."

Holley promptly called an organization funded by private and public grants which deals with fair housing complaints, HOME, in Cincinnati to register his complaint. HOME has a substantial staff to look into complaints concerning fair housing violations and make investigations. The next day HOME initiated visits to the subject property by various testers. A female tester was permitted by petitioner to view the house for renting to her and other members of her family. When a later female tester called to inquire about the property in February, Baumgardner indicated that he was considering using it as his office but would rent to her. A male tester, upon calling Baumgardner's office in March, was told that he had decided to convert the house into offices. Later in March, however, Baumgardner rented the house to a female with children. HOME (and later HUD) concluded that Baumgardner treated males and females differently with regard to renting this property. Upon a careful examination of the record, we are of the view that there is substantial evidence to support this conclusion, and that the ALJ was in the better position to make what was essentially a credibility determination on the content and effect of the Holley/Baumgardner conversations. Holley felt "offended, hurt, insulted and angered" by his rejection, according to his testimony and as found by the ALJ. A male friend moved in with Holley in his apartment inconveniencing him "for a couple of months" after Baumgardner refused Holley's expression of interest. The ALJ also found that Holley "now lives alone" and is uninterested in renting from Baumgardner.

I. PROCEDURAL ISSUES

HUD, as found by the ALJ, first contacted Baumgardner in this matter on or about April 3, 1989, and it then "sent him in error a housing discrimination complaint" about a house in East Chicago, Indiana. Along with this mistaken notice was a letter to Baumgardner from the HUD Chicago office referring to HUD investigator Jung, his phone number, and the subject "Holley v. Baumgardner, HUD case number 5-89-305-1, filing date March 21, 1989." The letter notified Baumgardner of a complaint that he had "engaged in discriminatory housing practices," and might file a sworn response within 10 days, and that an investigator would discuss the case with him. Holley's sworn complaint to HUD, however, was filed with HOME February 28, 1989, based on the January 19 call or calls. Baumgardner ignored the April 3, 1989 communication with the erroneous complaint enclosure. Jung did not commence investigation until August of 1989; he found Baumgardner "uncooperative." He used HOME's investigation and a contact with Holley as a basis for his final report recommending a formal complaint by the agency.

42 U.S.C. § 3604 describes, in pertinent part, unlawful acts:

(a) To refuse ... to negotiate for the ... rental of, or otherwise make unavailable or deny, a dwelling to any person because of ... sex....

....

(c) To make, print, or publish ... any statement ... with respect to the ... rental of a dwelling that indicates any preference, limitation, or discrimination based on ... sex, ... or an intention to make any such preference, limitation, or discrimination.

(d) To represent to any person because of ... sex ... that any dwelling is not available for inspection ... or rental when such dwelling is in fact so available.

Regulations issued under § 3604 further provide descriptions of prohibited conduct:

1. refusing to rent a dwelling to any person because of sex. 24 CFR 100.60(b)(2);

2. engaging in any conduct relating to the provision of housing that otherwise makes unavailable or denies dwellings to persons because of sex. 24 CFR 100.70(b);

3. discouraging any person from inspecting or renting a dwelling because of sex. 24 CFR 100.70(c)(1);

4. using words or phrases which convey that dwellings are not available to a particular group of persons because of sex. 24 CFR 100.75(c)(1);

5. expressing to prospective renters or any other persons a preference for or limitation on any renter because of sex. 24 CFR 100.75(c)(2); and

6. providing false or inaccurate information regarding the availability of a dwelling for rental to any person, regardless of whether such person is actually seeking housing, because of sex. 24 CFR 100.80(b)(5).

Baumgardner maintains that HUD violated its own regulations and the law in handling Holley's complaint thereby depriving him of his due process rights, and asks that this action be dismissed. Next, he claims that there was no real effort at conciliation, and that HUD did not complete its investigation within 100 days nor give him notice as to reasons for any delay within that time frame. Finally, he complains that he was not promptly furnished the final investigative report with exhibits, not even after requesting a copy thereof.

As noted by the ALJ, HUD not only failed to send Baumgardner a copy of the complaint within ten days, but it also sent out an erroneous copy of...