CA Supreme Court upholds $10,000 damage award in race case; affirms state agency’s ability to award

The California Supreme Court issued a decision in August that upholds the ability of the California Fair Employment and Housing Commission (FEHC) to award damages in fair housing cases. The 6-1 decision overturns a state court decision and a California Court of Appeals decision. It also overturns a previous California Supreme Court decision which held that the FEHC lacked constitutional authority to award damages. 

The decision reinstated a $10,000 award for loss of housing opportunity and emotional distress in a racial discrimination case filed by an African American police officer from southern California. 

In 1991, the California Supreme Court ruled that the FEHC could not award damages in the case of Walnut Creek Manor v. FEHC. In this latest decision, the Court noted recent changes in California’s fair housing laws had eliminated the Constitutional hurdles detailed in the Walnut Creek case. Specifically, the law now allows either party to remove cases before the FEHC to court. In this specific case, neither party chose to do so. Therefore, the Court ruled, the respondent agreed to the FEHC’s jurisdiction. 

The case that made its way to the state Supreme Court began when, in 1997, Sheryl Annette McCoy, who is African American, inquired about renting a unit at a duplex from Nancy Ann Konig, who is white. As McCoy read a rental notice, Konig came outside and stated, "Shame on you. Get off my porch. You’re trying to break into my house." Konig then slammed the door. 

McCoy asked a colleague, Terrence Smith, who is also African-American, to inquire about Konig’s rental unit. When Smith approached Konig, she ran into her house, slammed the door, and did not respond to Smith’s knocks. Smith left his name, address, and telephone number on a piece of paper, which he slipped into the mail slot as directed by the notice on the door. Konig never contacted Smith.

When the unit was later advertised, the Fair Housing Council of Long Beach sent testers to inquire about the unit. Konig discouraged the African American tester from renting the premises. When the African American tester asked for an application, Konig refused to give her one. In contrast, Konig treated the Caucasian tester with deference, did not ask whether she had given notice at her present residence, and told her to telephone her if she wished to rent the unit.

In a hearing, the FEHC awarded McCoy $10,000 in civil penalties, $1 for loss of housing opportunity, and $9,999 for emotional distress. In her appeals, Konig challenged the damages, but not the civil penalty, based on Walnut Creek.