Owners Get Borough to Halt Discriminatory Enforcement

Facts: Two rental apartment companies sued the Borough of Magnolia, N.J., to stop the Borough from enforcing its property rental ordinances in a manner that infringed on their rights under the Fair Housing Act.

In 2007, the Borough enacted Ordinance 11A, entitled “An Ordinance Creating Landlord Responsibilities,” which included among its provisions:

• A section making “[a]ny landlord and/or owner of a leased property within the borough…responsible for any activities, actions or events and the conduct of any person and/or animal which occurs in, on or about said premises or property[, including] any disorderly conduct, nuisance and any other behavior or conduct which is a violation of any state statute or of any of the provisions of the code of the borough;” and

• A section creating a licensing requirement for rental properties and charging $200 per rental unit per year, but if the owner has been convicted of any violation of the borough code, the annual fee would be $500 per unit for the following year.

The owners claimed that they were subjected to overzealous enforcement of the Borough's rental ordinances, in violation of their rights under the Fair Housing Act. They argued that the Borough issued made-up citations of their properties for nonexistent, vague, or baseless violations of the ordinance, and used the outstanding violations as the basis to withhold new certificates of occupancy. They asserted that the Borough enacted an unreasonable and punitive ordinance in an effort to interfere with their efforts to rent their properties to non-white tenants.

Decision: The U.S. District Court for the District of New Jersey agreed with the owners and barred the Borough from enforcing Ordinance 11A against them, and ordered the Borough not to enforce its property ordinances in a discriminatory manner.

Reasoning: According to the court, the Borough interfered with the owners' ability to lease apartments to non-white tenants. The Borough's motive in enacting the landlord responsibility ordinance and in issuing false and deliberately vague citations of the owners' properties was based in part on racial animus and fear of racial transition in the community. The Fair Housing Act makes it unlawful to interfere with a person's provision of housing based upon the race of potential residents.

• Raab Family Partnership v. Borough of Magnolia, February 2009