Fair Housing for Construction Lawyers

By Luke J. Farley Sr.

When you think about the statutes and codes that govern the construction and design process in North Carolina, does the N.C. Fair Housing Act come to mind? Probably not—but it should, or your clients may be needlessly exposing themselves to an expensive risk. According to Lawyers Weekly, in 2016 one of the largest settlements in North Carolina resulted from a construction and design dispute under the N.C. Fair Housing Act (NCFHA). The developers, builders, and architects of the SkyHouse high rise apartments in Raleigh and Charlotte agreed to pay $1.8M to correct sliding door thresholds which were inaccessible to people with disabilities. This wasn’t an isolated case. Owners, contractors, and designers around the country have paid out millions of dollars to resolve fair housing construction disputes. You and your clients can’t afford to be unaware of the Fair Housing Act.

The NCFHA is primarily meant to combat housing discrimination and most of the provisions of the act don’t directly bear on construction and design. The one provision of concern to owners, designers, and contractors is N.C. Gen. Stat. § 41A-4(f)(3) which makes it “an unlawful discriminatory housing practice to fail to design and construct covered multifamily dwellings” according to seven different handicap accessibility standards set out in the statute.

A wide variety of buildings and facilities are covered by the act, including condominiums, cooperatives, apartment buildings, vacation and time share units, assisted living facilities, continuing care facilities, nursing homes, public housing developments, transitional housing, single room occupancy units (SROs), homeless shelters, dormitories, hospices, extended stay or residential hotels, and more.  If your client is designing or constructing almost any type of building where people will be sleeping, they should ask themselves whether the N.C. Fair Housing Act design standards will apply.

Common violations of the design and constructions standards include building entrances having only steps but no ramps, door thresholds being too high and without a bevel, outlets placed too low, and switches placed too high. Unlike other provisions of the N.C. Fair Housing Act, proof of a violation doesn’t require a showing of discriminatory intent or effect; failure of the dwelling to meet the standards is enough.

When a project fails to meet the design and construction standards under the NCFHA, who’s responsible—the owner, the designer, or the contractor? On this question, construction law and fair housing law intersect with unexpected results. Citing the Spearin doctrine, most construction lawyers would point the finger at the designer. The contractor, after all, is only responsible for building according to the architect’s design; if the plans and specs didn’t meet accessibility requirements, that’s no fault of the contractor. Unfortunately, within fair housing disputes, the Spearin doctrine doesn’t work the same way it usually does. Neither do indemnity clauses, one of the cherished risk allocation tools in the construction industry. For a more thorough consideration of these and other issues, check out “A Quick Guide to Design and Construction Standards of the North Carolina Fair Housing Act,” which includes more than seventy citations to statutes, case law, and administrative guidance.

Luke J. Farley, Sr. is a construction lawyer with Ellis & Winters LLP in Raleigh. From 2014 to 2018, he served as a commissioner on the North Carolina Human Relations Commission, the state government agency responsible for enforcing the Fair Housing Act. Luke can be reached at luke.farley@elliswinters.com.