Before the

Commission on Human Rights

State of Missouri

 

 

 

 

STATE OF MISSOURI, ex rel.                             )

METROPOLITAN ST. LOUIS EQUAL               )

HOUSING OPPORTUNITY COUNCIL,            )

                                                                              )

                                    Petitioner,                           )

                                                                              )

            vs.                                                              )                 No.  05-0003 HRC

                                                                              )

ALBERT-HALL APARTMENTS AND                )

WILLIE & GERALDINE FERRELL,                    )

                                                                              )

                                    Respondents.                      )

 

 

RECOMMENDED DECISION

The Hearing Examiner recommends that the Missouri Commission on Human Rights (“the MCHR”) grant the claim of the Metropolitan St. Louis Equal Housing Opportunity Council (“the Council”) against Willie Ferrell (“Ferrell”) and award the Council $1.00 in actual damages and that the MCHR assess a civil penalty of $100.00 against Ferrell. 

The Hearing Examiner recommends that the MCHR dismiss “Albert-Hall Apartments” and Geraldine Ferrell as respondents.

Procedure

            The Council filed a complaint of housing discrimination with the United States Department of Housing Development (“HUD”) on August 31, 2004, and amended it on October 8, 2004.  The amended complaint was deferred to the MCHR.  On December 21, 2004, the

 

 

MCHR found probable cause to believe that discrimination occurred.  The MCHR received an affidavit of the failure of conciliation on March 15, 2005.  On May 19, 2005, the MCHR approved its executive director’s appointment of June Striegel Doughty, Administrative Hearing Commissioner, as Hearing Examiner.  On June 3, 2005, the MCHR transmitted its record to the Hearing Examiner.  The MCHR filed an amended complaint on September 20, 2005.  The complainant did not intervene.  On December 21, 2005, the Hearing Examiner convened a hearing on the amended complaint.  Assistant Attorney General Cyrus Dashtaki represented the MCHR.  Norvel E. Brown represented the Ferrells.  The transcript was filed on January 11, 2006.  The last brief was filed on May 4, 2006.

Findings of Fact

1.      Willie and Geraldine Ferrell (“the Ferrells”) are husband and wife.  They purchased the Albert-Hall apartment building (“Albert-Hall”) at 6136 Delmar in the City of St. Louis (“the City”) on June 11, 1974.  Albert-Hall is the name of the apartment building; it is not a business entity.

2.      The Ferrells owned rental property in University City before selling it in 1974 and buying Albert-Hall.  They have owned no other rental property.

3.      The Ferrells are still married, but have been separated for 20 years.  Ferrell lives in an apartment at Albert-Hall while his wife, Geraldine, lives in University City.  Ferrell is the manager of Albert-Hall.  Geraldine does not participate in the management or operations of Albert-Hall.

4.      Albert-Hall has 12 units.  Each of its three floors has two apartments in the rear and two in the front.  Each apartment has a 12 x 16 living room,[1] an 8 x 10 bedroom, a 6 x 10


 

 

 

kitchen, and a 4 x 4 bathroom.  The only closet is in the living room.  The front apartments also have a sun room. 

5.      Three or four years after the Ferrells bought Albert-Hall, the City included it in a “housing conservation district.”  This required Ferrell to obtain an occupancy permit for each apartment before renting it.  When this requirement began, the City’s inspectors measured the apartments and issued a permit for each apartment that specified the maximum number of people allowed to live there. 

6.      There were no more inspections after the initial ones, but the City has required Ferrell to obtain a new occupancy permit each time he rented an apartment to a different tenant. 

7.      Usually, the City issued occupancy permits allowing one person to live in each of the apartments in the rear of the building and two persons to live in each of the front apartments.[2]

8.      Although there were children living in the apartments when the Ferrells bought Albert-Hall, Ferrell decided that the apartments were too small to allow children to live there.[3]  He recalled that the ordinances governing the rental property he had in University City had not allowed rental to anyone with children unless there were at least two bedrooms.  This reinforced his conclusion that the apartments in Albert-Hall were not suitable for children.[4]  Ferrell did not rent to anyone with children after that.  No one from the City forbade him from allowing children.  He made that decision on his own.[5] 


 

 

9.      When he bought Albert-Hall in 1974, Ferrell posted a sign outside that stated:[6]

Apts for Rent

Adults Only

One Bedroom

726-6590

 

Eventually he replaced that sign with one that stated:[7]

NEWLY REMODELED APTS

FOR RENT

ADULTS ONLY

(ONE BEDROOM)

726-6590

 

10.    Ferrell replaced the last-described sign with a sign that stated: [8]

Fully Re-Modeled

ONE BEDROOM

APARTMENTS

FOR RENT

ADULTS ONLY

726-5341

 

This sign was on display in front of Albert-Hall on June 16, 2004.  Until that day, neither Ferrell nor the Council had received any complaints about Ferrell’s sign or his practice of renting only to tenants without children.[9]

11.    The Council is a private, not-for-profit corporation, dedicated to testing whether fair housing laws are being followed, investigating possible violations of those laws, and filing complaints with HUD and the MCHR when the Council believes violations have occurred.

12.    On June 16, 2004, an employee of the Council, Mira Tanna, saw the “adults only” sign outside Albert-Hall.  Tanna reported it to Katina Combs, housing/lending specialist at the


 

 

Council.  Combs directed Tanna to take photographs of the sign.  Tanna took photographs the next day.[10] 

13.    After that, Combs called the telephone number on the sign.[11]  It is the telephone number for Norma Betts, who lives in apartment 303.  Ferrell also lives in apartment 303.  Betts assisted Ferrell in the operation of Albert-Hall. 

14.    Combs asked Betts if there were any apartments available for rent.  Betts said that there were not, so Combs did not ask to rent an apartment.  Instead, Combs asked if families with children were allowed.  Betts said that they were not allowed.  Combs asked if the apartment was for seniors only.  Betts said no, anyone was welcome except families with children. 

15.    When Ferrell found out that his “adults only” sign violated the law, he took it down and had a new sign made, stating:[12]

FOR RENT

NEWLY REMODELED

1 BEDROOM

[telephone number]

He will not display the new sign until there is an apartment for rent.  At present, there is no sign on display.

16.    The Council’s funds come primarily from federal grants that HUD administers.  When the Council is the complainant in legal proceedings, it seeks money damages measured by the cost to the Council of expending its physical and personnel resources to investigate and litigate the complaint.  HUD requires the Council to pay HUD any money damages that the


 

 

Council receives as reimbursement for grant money directly related to the costs of the investigation.

17.    The Council’s board of directors and its executive director provide a formula to assess their damages.  They determine the Council’s overhead from the annual budget.  The overhead includes at least the cost of the copier lease, the rent, office supplies, equipment, and salaries.  They average the overhead to arrive at an hourly rate which they assign to the personnel who investigate and assist in litigating the case.  A Council employee who investigates and assists in litigating the complaint keeps a time log showing the date, nature of activity, and number of hours expended.  The Council arrives at the damage amount for a particular case by multiplying the employee’s hourly rate by the hours expended on the case. 

18.    In this case, Combs investigated and assisted in the litigation.  The Council assigned her hourly rate at $150. 

Conclusions of Law

            The MCHR has jurisdiction to hear and determine this complaint.[13]  

Dismissal of Respondents

            The MCHR’s amended complaint named Albert-Hall Apartments as a respondent.  When entering his appearance for the Ferrells at the beginning of the hearing, the Ferrells’ counsel stated:  “Albert Hall Apartments is listed as a party to these proceedings and Albert Hall Apartments is a building.  It has no legal status at all. . . .  And so there’s nothing to represent.”[14]  The MCHR did not oppose this assertion, and we note that neither party has continued to identify “Albert-Hall Apartments” as a respondent in their respective post-hearing briefs. 


 

 

            There is no evidence that “Albert-Hall” was anything other than the name of the building engraved in the masonry over the main entrance of the apartment building.[15]  We recommend that the MCHR dismiss “Albert-Hall Apartments” as a respondent.

            Although Geraldine Ferrell did not ask to be dismissed, we find no evidence to show that she was involved actively or passively in the business of renting apartments.  Although her name is on the deed to the property, Ferrell testified that his wife had no active involvement in the rental business.[16]  The MCHR did not develop any further facts or cite to any law that makes Geraldine Ferrell liable for her husband’s actions.  We recommend that the MCHR dismiss Geraldine Ferrell as a respondent.

Admission of Exhibit C

            At the hearing, the MCHR offered Exhibit C to prove what resources the Council expended on its investigation and the dollar value of those resources.  Ferrell objected to Exhibit C as not having sufficient foundation to be admitted as a business record and, in the alternative, that it was not the best evidence.[17]  We deferred ruling until the parties briefed the issues.

            Section 536.070(10) sets forth the standard for admissibility of a business record in an administrative proceeding:

Any writing or record, whether in the form of an entry in a book or otherwise, made as a memorandum or record of an act, transaction, occurrence or event, shall be admissible as evidence of the act, transaction, occurrence or event, if it shall appear that it was made in the regular course of any business, and that it was the regular course of such business to make such memorandum or record at the time of such act, transaction, occurrence, or event or within a reasonable time thereafter.  All other circumstances of the making of such writing or record, including lack of personal knowledge by the entrant or maker, may be shown to affect the weight of such evidence, but such showing shall not affect its admissibility.  The


 

 

 

term "business" shall include business, profession, occupation and calling of every kind.

 

Under this standard, the hearing officer “may determine from the totality of the circumstances whether the document meets the criteria; the document’s custodian or preparer need not be present to sponsor the document.”[18] 

            Exhibit C consists of two pages.  The first page is entitled, “Damages for Frustration of Mission and Diversion of Resources for Fair Housing Organization:  Metro. St. Louis Equal Housing Opportunity Council v. Albert Hall apartments [sic].”  Under “Market Rates,” the form requires the listing of each employee who worked on the case with his or her “market hourly rate” and the basis for the hourly rate.  Section 1 lists the employee for the Albert-Hall investigation as Combs, whose market hourly rate is $150.  Then the form lists under “Basis,” “organizational training rate.”  Under “Staff Time for Intake, Investigation and Litigation – attach time logs,” the form lists Combs as having worked 28.25 hours.  The form states $4,237.50 as the product of multiplying 28.25 hours by Combs’ market hourly rate of $150.  The second page is Combs’ time log.  It lists Combs’ activity according to date, description of action, and time spent.  The printed initials “KC” are next to each entry.

            The executive director of the Council, Willie Jordan, testified that for each case that the Council handles investigating claims of housing discrimination, the Council prepares a damage and frustration of mission sheet as on the first page of Exhibit C “for the purposes of accumulating the time and the hours that have gone into the case.”[19]  He testified that the Council arrived at the hourly market rate by using all of the annual expenses of the Council’s overhead.[20]  Jordan described the time log on the second page of Exhibit C as a summary of the hours that


 

 

Combs spent in the investigation.[21]  He described some of his meetings with Combs that the time log shows.[22]   

            The evidence establishes Exhibit C’s admissibility under § 536.070(10).  The time log was made in the regular course of the Council’s business to document Combs’ activities.  Both pages of the exhibit were made as a part of the Council’s regular business practice to document and place a monetary value on Combs’ activities in order to collect monetary damages.      

            Ferrell also objects that the exhibit does not represent the best evidence because it is a summary from the file, not the file itself.   Generally, the best evidence rule provides that “in proving the terms of a writing, where its terms are material, the original writing must be produced unless it is shown to be unavailable for some reason other than the serious fault of the proponent.”[23]  However, “where a fact (in this case time and services) to be proven exists independently of a writing, and there is also evidence of such fact written in writing, then both sources, i.e., oral or written evidence, become primary evidence and the best evidence rule is inapplicable.”[24]  We reject Ferrell’s characterization of the time log as merely a summary from the file.  It appears from Jordan’s testimony and from the initials “KC” next to each entry that Combs made each entry.  Further, “Insofar as the appellant's contention that the best evidence rule prevents the admission of such testimony is concerned, the purpose of the Uniform Business Records as Evidence Law is to avoid many of the overly-technical rules of common law regarding the admissibility of business records as evidence, and to make admissible records or other entries which without the law would be inadmissible.”[25] 


 

 

The time log appears to represent Combs’ documentation as to what she did and how long it took her.  She need not have testified personally because, as we explained above, it qualifies as a business record under § 536.070(10).  Therefore, the “best evidence rule” does not apply here.

            The best evidence rule also does not apply to the first page of the exhibit.  Jordan participated in the decision on how the hourly rate was calculated and how the damage calculation was arrived at.  What appears on the first page of the exhibit, therefore, has a basis in Jordan’s testimony.  The best evidence rule does not apply. 

            We admit Exhibit C.  However, as demonstrated in the proposed conclusions of law on damages, we give it little weight. 

Merits of the Amended Complaint

            Section 213.040 provides:

            1.  It shall be an unlawful housing practice:

 

            (1) To refuse to sell or rent after the making of a bona fide offer, to refuse to negotiate for the sale or rental of, to deny or otherwise make unavailable, a dwelling to any person because of race, color, religion, national origin, ancestry, sex, disability, or familial status;

 

            (2) To discriminate against any person in the terms, conditions, or privileges of sale or rental of a dwelling, or in the provision of services or facilities in connection therewith, because of race, color, religion, national origin, ancestry, sex, disability, or familial status;

 

            (3) To make, print, or publish, or cause to be made, printed, or published any notice, statement or advertisement, with respect to the sale or rental of a dwelling that indicates any preference, limitation, or discrimination based on race, color, religion, national origin, ancestry, sex, disability, or familial status, or an intention to make any such preference, limitation, or discrimination[.]

 


 

 

 

Section 213.010 provides:

 

As used in this chapter, the following terms shall mean:

 

*   *   *

 

            (3) "Complainant", a person who has filed a complaint with the commission alleging that another person has engaged in a prohibited discriminatory practice;

 

*   *   *

 

            (5) "Discrimination", any unfair treatment based on race, color, religion, national origin, ancestry, sex, age as it relates to employment, disability, or familial status as it relates to housing;

 

            (6) "Dwelling", any building, structure or portion thereof which is occupied as, or designed or intended for occupancy as, a residence by one or more families, and any vacant land which is offered for sale or lease for the construction or location thereon of any such building, structure or portion thereof;

 

*   *   *

 

            (10) "Familial status", one or more individuals who have not attained the age of eighteen years being domiciled with:

 

            (a) A parent or another person having legal custody of such individual; or

 

            (b) The designee of such parent or other person having such custody, with the written permission of such parent or other person.  The protections afforded against discrimination on the basis of familial status shall apply to any person who is pregnant or is in the process of securing legal custody of any individual who has not attained the age of eighteen years;

 

*   *   *

 

            (14) "Person" includes one or more individuals, corporations, partnerships, associations, organizations, labor organizations, legal representatives, mutual companies, joint stock companies, trusts, trustees, trustees in bankruptcy, receivers, fiduciaries, or other organized groups of persons;

 

*   *   *

 

 

 

 

            (16) "Rent" includes to lease, to sublease, to let and otherwise to grant for consideration the right to occupy premises not owned by the occupant;

 

*   *   *

 

            (18) "Unlawful discriminatory practice", any act that is unlawful under this chapter.

 

Refusal to Negotiate, and

Terms, Conditions, or Privileges of Rental

            The MCHR contends that Ferrell violated § 213.040.1(1) by refusing to negotiate for the rental of a dwelling to the Council based on familial status and denied or otherwise made unavailable a dwelling to the Council based on familial status.  The MCHR contends that Ferrell also violated subdivision (2) by imposing terms, conditions, or privileges on the rental of an apartment that indicated discrimination based on familial status.

            Both parties agree that to make a prima facie case, the MCHR must prove:  (a) that the complainant, the Council, is protected by § 213.040.1(1) and (2); (b) that Ferrell refused to negotiate with the Council; and (c) that the Council’s familial status was a factor in Ferrell’s decision not to rent to the Council.[26]

            Ferrell asserts that the phrase “refusal to negotiate” presumes that there is something to negotiate over, in this case, an apartment available for rent.  Since it is undisputed that there was no apartment for rent at the time Combs called Betts, Ferrell asserts that there can be no violation of the “refusal to negotiate” provision in § 213.040.1(1). 

“Negotiate” means “to arrange for or bring about through conference, discussion, and compromise.”[27]   In housing discrimination cases, the matter “to arrange for or bring about” is the rental or sale of housing.  If there is nothing for rent or sale, there is nothing to arrange for or


 

 

to bring about.  Therefore, a landlord who has no apartment for rent cannot be said to refuse to negotiate when he or she truthfully advises an inquirer that there is no apartment available. 

Typically, refusal to negotiate cases are those in which the landlord lies about the availability of an apartment to someone in a protected class to which the landlord does not want to rent.  For example, in Van Den Berk v. Missouri Comm'n on Human Rights, 26 S.W.3d 406 (Mo. App., E.D. 2000), the landlord showed the available apartment to a white person, but told the black person who inquired that it was not available. 

The MCHR has failed to show that Ferrell violated the refusal to negotiate provision in

§ 213.040.1(1).  By the same reasoning, Ferrell cannot be said to have discriminated against “any person” by imposing discriminatory conditions on the rental because there was nothing to rent.  Therefore, the MCHR has also failed to establish a violation of § 213.040.1(2).

Further, our research failed to reveal any case in Missouri or in federal court in which the presence of a sign, such as the one here, was ever prosecuted under the refusal to negotiate provisions of Missouri or federal law.  This strongly suggests that the legislature’s provision of

§ 213.040.1(3) and Congress’ provision of its federal counterpart were intended for situations such as in this case in which the sign itself suggests that there may have been refusals to negotiate in the past (and would be in the future) but there is no complaining witness to any refusals.    

Discriminatory Advertisement

 

            In his post-hearing written argument, Ferrell states that he does not dispute the following conclusion of law:[28]

            9.  Respondents violated Section 213.040.1(3) RSMo by making and publishing a sign that indicated preferences for “Adults Only” in its advertisement of its apartments[.]

 

 

 

Ferrell testified that since he began ownership of the apartment building in 1974, he had someone make apartment-for-rent signs, which he has displayed, that expressly announced his “adults only” policy.  He presented photographs of all of the signs that he used up to and including the one complained about in this case.  He testified that he did not want to rent to someone with a child because the apartments were too small and because the University City ordinances he was used to operating under restricted tenants with children to those apartments that had more than one bedroom.  He also testified that he began putting the adult-only signs out when he bought the apartment building in 1974, that the City did not begin its issuance of occupancy permits until three or four years later, and that it was his decision, not the City’s, to limit rentals to adults. 

            The undisputed evidence establishes that Ferrell violated § 213.040.1(3) by advertising on June 16 and 17 that he restricted rentals to adults.  It does not matter that there was no apartment for rent at the time because subdivision (3) not only prohibits advertisements that indicate discrimination based on familial status, but also any advertisement “that indicates … an intention to make any such preference, limitation, or discrimination.” 

Damages

            Section 213.075.11(1) provides for “actual damages” when a respondent has engaged in an unlawful discriminatory practice.  “A damage award is designed to fulfill the remedial purposes of the civil rights laws and compensate a wronged person for the loss or injury suffered.”[29] 

            The Council is a not-for-profit corporation whose mission is two-fold:  education and enforcement involving fair housing laws.  The MCHR contends that Ferrell’s violation of


 

 

§ 213.040.1(3) damaged the Council because the offending sign occasioned the Council to expend its resources to investigate and litigate the violation. 

There is no Missouri case law on what constitutes damages for a complainant such as the Council.  We may look to federal housing discrimination cases because of the similarities between the federal and Missouri statutes.[30]  The law on cognizable damages to not-for-profit advocacy agencies is found in federal cases addressing whether such agencies have standing to sue under the Fair Housing Act (“FHA”).  The United States Court of Appeals for the Eighth Circuit summarized the law in a case involving a fair housing organization called “ACORN”:[31]

The United States Supreme Court has held the sole requirement for an organization such as ACORN to have standing to sue in its own right under the FHA is injury in fact.  [Citation omitted.]  “As long as respondents have alleged distinct and palpable injuries that are ‘fairly traceable’ to petitioner’s action, the Art. III requirement of injury in fact is satisfied.”  [Citations omitted.]  A fair housing organization satisfies this requirement where it “devote[s] significant resources to identify and counteract” a defendant’s unlawful practices.  [citations omitted.] 

 

            The MCHR relied on Exhibit C to prove what resources the Council expended on its investigation and the dollar value of those resources.  We admitted Exhibit C over objection as a business record under § 536.070(10), but this does not mean we must find it persuasive of the facts represented therein.  “All other circumstances of the making of such writing or record, including lack of personal knowledge by the entrant or maker, may be shown to affect the weight of such evidence.”[32]  Ferrell asserts that despite the admission of the exhibit, Jordan’s testimony and Exhibit C fail to provide substantial evidence as to the existence and amount of damages.  “Generally, damages need not be established with absolute certainty, but reasonable certainty is


 

 

required as to both existence and amount, and the evidence must not leave the matter to speculation.”[33] 

            Combs and Jordan testified about the efforts put into the investigation leading up to the filing of a complaint at HUD.  Jordan testified that he put a dollar value on the damages to the Council by multiplying the “market rate” ($150) assigned to Combs by the number of hours she expended investigating and litigating the case (28.25 hours).  This results in the total of $4,237.50. 

The evidence establishes the existence of damages, but not the amount.  The amount of damages hinges on the “market rate” that the Council assigned to the work of Combs.  Jordan could not explain how the Council determined the market rate other than that it represented an averaging of the Council’s annual expense budget:[34] 

The $150.00 hourly rate also accumula -- also takes into account our overhead, our copier lease, the rent, every amount of paper and pencils that we use.  It’s an average based upon a national standard that we were trained to use with the National Fair Housing Advocacy.

 

*   *   *

 

I -- myself and the Board established the market rate based upon our overhead cost; how much we pay in rent; our lease, copier lease; some of the larger bills that we have; and then equipment cost; and office supplies; and then, also the salary of the employees. 

 

When asked if he had a breakdown of the market rate, he stated, “We don’t have anything with us today, but certainly we could-- ”[35]  There was no explanation of the methodology of assigning to Combs’ hourly rate the salaries of the other eight employees, the rent, and the costs of


 

 

equipment and supplies.  The record fails to provide substantial evidence as to why the $150 per hour figure is reasonable.

            Further, Combs’ time log in Exhibit C fails to provide substantial evidence of the hours expended.  The time log presents serious questions that were not answered.  This is a case in which a Council employee spotted the “adults only” sign and reported it to Combs, who instructed the employee to take photographs the next day.  Combs then designed a test that involved her calling the telephone number on the sign and inquiring whether there was an apartment to rent and the policy of renting to a tenant with children.  Betts’ answers were concise and candid.  The Council then filed a complaint with HUD and spoke with the MCHR investigator assigned. 

            The questions about the log begin with the discrepancy between Combs’ testimony that she called Betts and the log entries indicating that Combs spent 45 minutes on June 21, “Debriefed tester on phone contact with respondent[.] Received complete test packet from tester.”  Then we must question the accuracy of two hours on June 21 for “Summarized testing data.”  There were two photographs of the sign and a short conversation with Betts.  Why did it take two hours to summarize what that evidence revealed?  The brief facts of this case also require questions about the two hours entered for July 21 for “Prepared case for HUD review[.]  Complete case for HUD review[.]  Submitted” and the July 22 entry of three hours for “Information to HUD for investigation.”  We also need to know what required two hours on August 27 for “Investigation” and the need for 30 minutes each for a “Case update” on October 11, November 9, December 9, 2004, and then in 2005 on December 9, August 24, November 29, and December 6.  Particularly questionable is the six-hour long update on December 7, 2005. 

The MCHR presented Combs first, but asked her no questions about Exhibit C.  The MCHR introduced Exhibit C through Jordan, who testified immediately after Combs.  Although

 

 

Combs was still present after Jordan’s testimony, the MCHR made no attempt to recall her to answer questions about the time log.  Because of the lack of explanation for questionable time log entries and because the MCHR failed to ask Combs about these matters even though she was a witness, we find no substantial evidence upon which we could recommend any finding of fact on the number of hours expended.

            The MCHR proved that Ferrell violated § 213.040.1(3) and that the Council suffered some unquantified damage in terms of its expenditure of resources on the investigation.  The MCHR failed, however, to prove how much damage occurred.  Instead, these circumstances support the assessment of nominal damages:

In general theory, nominal damages are allowed where a legal right has been invaded but no actual damages were suffered or proven. . . .  It is for the reason that these damages are not true damages at all, but imputed to vindicate an invasion of right that otherwise would go without redress, that they are in name only nominal. . . . It is where the invasion of right has produced no actual present loss of any measurable kind, therefore, that nominal damages are recoverable. . . .

 

            Accordingly, nominal damages are fixed at a trifling sum, usually no more than $1.00, sometimes less.[[36]]

 

Accordingly, we recommend that the MCHR assess $1.00 in nominal damages against Ferrell on behalf of the Council.

Civil Penalty

In its post-hearing brief, the MCHR seeks a civil penalty under § 213.075.11(2), which allows such a penalty upon a finding:[37]

            (2) That a respondent has engaged or is about to engage in a violation of section 213.040 . . .  the commission may, in addition to the relief provided in subdivision (1) of this subsection, assess a

 

 

civil penalty against the respondent, for purposes of vindicating the public interest:

 

            (a) In an amount not exceeding two thousand dollars if the respondent has not been adjudged to have violated one or more of the sections enumerated in subdivision (2) of this subsection within five years of the date of the filing of the complaint[.]

 

            The MCHR asks only for a cease and desist order and compensatory damages for the Council in its amended complaint.  It does not request the imposition of a civil penalty.  While good practice would require informing the other party and the MCHR what relief is being requested, it is not clear whether the law requires the MCHR complaint to contain a request for damages.  Section 536.063 requires in any contested case:

Any writing filed whereby affirmative relief is sought shall state what relief is sought or proposed and the reason for granting it . . . provided, however, that this subdivision shall not apply when the writing is a notice of appeal as authorized by law.

 

However, the statute specifically addressing MCHR proceedings requires only that the complaint:[38]

shall state the name and address of the person alleged to have committed the unlawful discriminatory practice and which shall set forth the particulars thereof and such other information as may be required by the commission.  The complainant’s agent, attorney or the attorney general may, in like manner, make, sign and file such complaint.

 

Regulation 8 CSR 60-2.065(1) provides:

After a contested case has been set for public hearing, the complaint may be amended by the commission or the complainant-intervenor within time limits set by the presiding officer, to cure technical defects or omissions, including to clarify and amplify allegations made in the complaint. . . .

 

The content of the parties’ other filings, however, do not require us to resolve this issue.  The first mention of a civil penalty is in the last paragraph of Ferrell’s answer to the amended

 

 

complaint, in which he states, “WHEREFORE, Respondents respectfully request that a reasonable penalty be imposed for the placement of the offending sign . . . .”  There was no mention of penalties at the hearing by either party.  The MCHR has not asked to file a second amended complaint to add a request for a civil penalty, but did include a request for a civil penalty in its post-hearing written argument.  In Ferrell’s post-hearing written argument, he admits that his display of the “adults only” sign violates § 213.040.1(3) and requests a civil penalty of $10.  Given this unique set of circumstances, we conclude that both parties consent to the submission of the civil penalty issue to the MCHR. 

            The only rule the law provides as to the amount of the civil penalty that the MCHR can impose is to limit it to a maximum of $2,000 in cases, such as this, in which there has been no prior adjudication that Ferrell violated state civil rights laws.  That the penalty is “for purposes of vindicating the public interest” establishes its penal nature. 

[W]here fines and penalties are prescribed as a punishment for a violation of public rights, i.e., crimes, and such penalties or fines are to be recovered by public authority, the disposition of such recovered fines or penalties comes within the constitutional provision [art. IX, section 7] . . . and they may not be turned awry from the prescribed constitutional course.[[39]]

 

            Section 213.040.1 has outlawed housing discrimination on the basis of familial status since 1992.[40]  Ferrell is responsible for knowing and following the law, but there is no showing that he actually knew he was violating any law with the “adults only” policy until after the Council investigation began in 2004.  He subsequently took down the offending sign and had one prepared that complies with the law.  Ferrell was not a sophisticated business person.  Ferrell’s decision not to rent to people children was not based on any mean-spirited motive against


 

 

them, but on the practical concerns of having children live in such small quarters and his experience with University City’s ordinance that required rental units to have more than one bedroom before being rented to tenants with children.  Further, Albert-Hall is a small twelve-unit apartment building in a large metropolitan area.  The damage to the public in terms of the percentage of rental units in the metropolitan area affected by the discrimination is miniscule.  We recommend that the MCHR assess a civil penalty against Ferrell of $100.00.

Summary

            The Hearing Examiner recommends that the MCHR take the following actions:

(1)   dismiss “Albert-Hall Apartments” and Geraldine Ferrell as respondents;

(2)   assess nominal damages of $1.00 against Ferrell;

(3)   assess a civil penalty of $100.00 against Ferrell; and

(4)   order Ferrell to cease and desist from any ongoing discriminatory practices that violate the prohibition on familial status discrimination in § 213.040.1(3) and to submit a report of the manner of compliance.

 

            Pursuant to the MCHR’s Regulation 8 CSR 60-2.200(1), the parties may file exceptions within ten days of the date of this recommended decision.

            SO RECOMMENDED on June 8, 2006.

 

 

                                                                              ________________________________

                                                                              JUNE STRIEGEL DOUGHTY

                                                                              Hearing Examiner

 



                [1]Measurements are in feet.

                [2]At least once, the City issued a permit restricting an apartment previously permitted for two persons to just one person when tenants changed.  The occupancy permit for apartment 203 issued May 27, 1994, allowed two persons, while the permit issued January 9, 1998, allowed only one.  (Exs. 10 and 5, respectively.)

                [3]Tr. at 138.

                [4]Id. at 103-104.

                [5]Id. at 141.

                [6]Ex. 3.

                [7]Ex. 2.

                [8]Ex. 1 and Exs. A and B.

                [9]The law prohibiting housing discrimination on the basis of familial status became effective August 28, 1992.  L.1992, H.B. 1619, p. 683 at 687 and table with effective dates at 1259 (86th Gen. Assbly., 2d Reg. Sess.)

                [10]Exs. A and B.

                [11]Combs’ time log in Exhibit C contains entries for June 21 indicating that she “sent test out” and “Debriefed tester on phone contact with respondent.  Received complete test packet from tester.”  While this indicates that someone other than Combs did the testing, Combs testified that she did the testing.  (Tr. at 17-18.)  We take as true the account that Combs gave under oath.

                [12]Ex. 4.

                [13]Section 213.075.3 and .5.  Statutory references are to the 2000 Revised Statute of Missouri.

                [14]Tr. at 6-7.  This is consistent with the Ferrell’s denial that Albert-Hall was a business entity in response to paragraph 5 of “Petitioner’s First Request for Admissions to Respondent Albert-Hall Apartments.”  (Ex. D.) 

                [15]Ex. B.

                [16]Tr. at 82-83.

                [17]Id. at 37 and 42.

                [18]State ex rel. Sure-Way Transp. v. Division of Transp., 836 S.W.2d 23, 26 (Mo. App., W.D. 1992).

                [19]Tr. at 35.

                [20]Id. at 35, 49-51.

                [21]Tr. at 44-45.

                [22]Id. 45-49.

                [23]State v. Fontana, 589 S.W.2d 639, 641 (Mo. App., S.D. 1979). 

                [24]Jourdan v. Gilmore, 638 S.W.2d 763, 770 (Mo. App., W.D. 1982). 

                [25]Adler v. Ewing, 347 S.W.2d 396, 401 (Mo. App., St.L. 1961).

                [26]Van Den Berk v. Missouri Comm'n on Human Rights, 26 S.W.3d 406, 412 (Mo. App., E.D. 2000).

                [27]MERRIAM-WEBSTER'S COLLEGIATE DICTIONARY 777 (10th ed. 1993).

                [28]Resp. Brief, at 7.

                [29]Van Den Berk, 26 S.W.3d at 413.

                [30]Van Den Berk, 26 S.W.3d at 411.

                [31]Arkansas ACORN Fair Housing, Inc. v. Greystone Development, LTD. CO., 160 F.3d 433, 434 (8th Cir. 1998). 

                [32]Section 536.070(10).

                [33]Hershewe v. Perkins, 102 S.W.3d 73, 80 (Mo. App., W.D. 2003), quoting Bechtle v. Tandy Corp.,

77 S.W.3d 689, 695 (Mo. App., E.D. 2002).

                [34]Tr. at 35, 49.

                [35]Id. at 51.

                [36]Simpkins v. Ryder Freight System, 855 S.W.2d 416, 422-23 (Mo. App., W.D. 1993).

                [37]Section 213.075.11(2) authorizes assessment of a civil penalty in cases heard by a panel of the MCHR.  For cases heard by a hearing examiner, subsection 13 authorizes the hearing examiner to “recommend to the commission an order granting such relief as provided in subsection 11 of this section[.]”

                [38]Section 213.075.1.

                [39]Missouri Gaming Comm'n v. Missouri Veterans' Comm'n, 951 S.W.2d 611, 613 (Mo. banc 1997), quoting State ex rel. Rodes v. Warner, 94 S.W. 962, 964 (1906).

                [40]L.1992, H.B. 1619, p. 683 at 687 (86th Gen. Assbly., 2d Reg. Sess.).