Facts of the Case

The Fair Housing Act (FHA) forbids racial discrimination in respect to the sale or rental of a dwelling. The Holleys, an interracial couple, alleged that a Triad real-estate corporation sales representative prevented them from buying a Triad-listed house for racially discriminatory reasons. The Holleys filed suit against the sales representative and David Meyer, Triad's president, sole shareholder, and licensed "officer/broker," claiming that he was vicariously liable for the sales representative's unlawful actions. The District Court dismissed the claims, stating that the FHA did not impose personal vicarious liability upon a corporate officer or a "designated officer/broker." In reversing, the Court of Appeals ruled that the FHA imposes strict liability principles beyond those traditionally associated with agent/principal or employee/employer relationships.

Question

Does the Fair Housing Act impose personal liability without fault upon an officer or owner of a residential real estate corporation for the unlawful activity of the corporation's employee or agent?

Conclusion

No. In a unanimous opinion delivered by Justice Stephen G. Breyer, the Court held that the FHA does not impose liability without fault upon the employer in accordance with traditional agency principles. In other words, the FHA normally imposes vicarious liability upon the corporation, but not upon its officers or owners. In the absence of a clear indication of congressional intent to abrogate the common law principles of vicarious liability, the Court reasoned that neither the right of the officer to control the salesperson nor the overriding societal priority of the FHA's objectives warranted extending tort-related vicarious liability rules to include the officer. The Court also reasoned that nothing in the FHA supported imposing a non-delegable duty upon the officer to ensure that its salesperson did not discriminate.