In 1985, the Chanticleer Condominium Association passed an amendment to their Declaration of Condominium Ownership, stating that "no minor children under the age of 18 years may reside in any unit purchased after the effective date of this amendment without the prior written approval of the Board of Managers." Residents who violated the rule were subject to "injunctive relief" and a $10,000 fine. In other words, departing residents could not sell their homes to families with children.
The Simovitses moved into Chanticleer in 1993. The resident screening committee advised them of the "no minor children" rule. Stephen Simovits, who happened to be a licensed real estate agent, told the committee that he thought that it was illegal to have such a rule. The committee noted his statement but did not change the rule.
In May 1995, the Simovitses decided to sell their condominium. They were asking for $187,500. Karen Jones, a real estate agent, contacted them with a prospective buyer. The buyer happened to have a small child. The Simovitses testified that they decided not to sell the condo to the buyer because they did not want to cause any trouble with the condo association. The condo remained on the market for close to four months without any prospective buyers.
In August 1995, another real estate agent, Bonita Swartz, approached the Simovitses about a client who wanted to make an offer on the condominium. The buyer had three children, all under the age of 18. Stephen Simovits and Swartz approached the condo association's president, Jim Londos, informing him that a prospective buyer with minor children was interested in purchasing the condominium. Londos told them that the association's rules prohibited the sale of a condominium to a family with minor children. Swartz told her client about the rule and her client withdrew the offer to buy the condo.
Londos contacted the association's attorney about his conversation with Stephen Simovits. The attorney contacted Stephen Simovits on November 8, 1995 and advised him of the association's rules. Less than a week later, the attorney sent a letter to Londos, explaining that discriminating against families with children was illegal and "unless Chanticleer can produce hard evidence that the community meets [the Fair Housing Act's] narrowly construed exemptions, the financial liability of Chanticleer could be substantial." Londos shared the letter with the association's Board of Managers on the day he received it. Despite the warning, the Association decided to maintain the "no children" rule.
On April 15, 1996, the Simovitses sold their condominium to a couple with no children for $145,000, more than $40,000 less than what they had originally asked for, and more than $20,000 less than the offer the prospective buyer with children had offered. The Simovitses, with the assistance of the HOPE Fair Housing Center, sued the Chanticleer Condominium Association, alleging that the "no children" rule diminished the value of their condo by more than $30,000.
Judge Keys ruled in the Simovitses' favor. He ordered Chanticleer to pay the Simovitses $12,500 for reduction of value of their condo, $3,560 for unnecessary mortgage payments, and $10,000 in punitive damages. The judge awarded HOPE $7,230 in economic losses and $10,000 in punitive damages. He also ordered Chanticleer to remove the "no children" rule from its by-laws and to submit annual reports to HOPE until the year 2000.
Bernard Kleina, HOPE's executive director, said, "The thing that amazed me was that this case went to trial. The defendants fought this case to the end even though it was blatantly discriminatory." Kleina also noted that the case was handled very quickly in federal court. The Simovitses' complaint came in April 1996 and the trial was in May 1996.