Gladstone, Realtors v. Village of Bellwood
441 U.S. 91 (1979)

Annotate this Case

U.S. Supreme Court

Gladstone, Realtors v. Village of Bellwood, 441 U.S. 91 (1979)

Gladstone, Realtors v. Village of Bellwood

No. 77-1493

Argued November 29, 1978

Decided April 17, 1979

441 U.S. 91

CERTIORARI TO THE UNITED STATES COURT OF APPEALS

FOR THE SEVENTH CIRCUIT

Syllabus

Section 812 of the Fair Housing Act of 1968 (Act) provides that the rights granted by § 804 against racial discrimination in the sales or rental of housing "may be enforced by civil actions in appropriate United States district courts." Respondents (the village of Bellwood, one Negro and four white residents of Bellwood, and one Negro resident of a neighboring municipality) brought separate actions in District Court under § 812 against petitioners (two real estate brokerage firms and certain of their employees), alleging that they had violated § 804 by "steering" prospective Negro homeowners toward a specified 12- by 13-block integrated area ("target" area) of Bellwood and by steering white customers away from the "target" area. It was further alleged that Bellwood had been injured by having its housing market wrongfully manipulated to the economic and social detriment of its citizens, and that the individual respondents had been denied their right to select housing without regard to race, and had been deprived of the social and professional benefits of living in an integrated society. Monetary, injunctive, and declaratory relief was sought. Prior to bringing suit, the individual respondents, purportedly, but not in fact, seeking to purchase homes, had acted as "testers" in an attempt to determine whether petitioners were engaged in racial steering. Four of the six individual respondents reside in the "target" area. The District Court granted summary judgment for the petitioners in both cases, holding that respondents, who had acted only as testers, and thus were, at most, indirect victims of the alleged violations, lacked standing to sue under § 812, which was limited to actions by "direct victims" of violations. The Court of Appeals reversed and remanded, holding that, although the individual respondents lacked standing in their capacity as testers, they were entitled to prove that the discriminatory practices documented by their testing deprived them, as residents of the adversely affected area, of the social and professional benefits of living in an integrated society; that the requirements of Art. III had been satisfied as to both the individual respondents and respondent village; that § 810 of the Act -- which provides that a "person aggrieved" by a violation of the

Page 441 U. S. 92

Act may seek conciliation from the Secretary of Housing and Urban Development (HUD), and, if conciliation fails, bring suit in district court -- and § 812 provide alternative remedies available to precisely the same class of plaintiffs; and that the conclusion in Trafficante v. Metropolitan Life Ins. Co.,409 U. S. 205, 409 U. S. 209, that standing under § 810 extends "as broadly as is permitted by Article III,'" is applicable to cases brought under § 812.

Held:

1. The Court of Appeals correctly interpreted §§ 810 and 812 as providing alternative remedies to precisely the same class of plaintiffs, with the result that standing under § 812, like that under § 810, is as broad as is permitted by Art. III. Trafficante, supra. This construction of the Act is consistent with both its language and its legislative history, and with the interpretation of HUD, the agency primarily assigned to implement and administer the Act. Pp. 441 U. S. 100-109.

2. The facts alleged in the complaints and revealed by initial discovery are sufficient to provide standing to respondents under Art. III, except with respect to the two individual respondents who do not reside within the "target" area, and thus summary judgments for petitioners should not have been entered. Pp. 441 U. S. 109-116.

(a) If, as alleged, petitioners' sales practices actually have begun to rob Bellwood of its racial balance and stability, the village has standing to challenge the legality of that conduct. Pp. 441 U. S. 109-111.

(b) The allegation that the "target" area is losing its integrated character because of petitioners' conduct is sufficient to satisfy Art. III with respect to the individual respondents who reside in that area. The constitutional limits of these respondents' standing to protest the intentional segregation of their community do not vary simply because that community is defined in terms of city blocks rather than, as in Trafficante, supra, by reference to apartment buildings, but instead are determined by the presence or absence of a "distinct and palpable injury" to respondents. Warth v. Seldin,422 U. S. 490, 422 U. S. 501. Moreover, to the extent that the complaints allege economic injury to these respondents resulting from a diminution in the value of their homes due to petitioners' conduct, convincing evidence of such a decrease in value would be sufficient under Art. III to allow standing to contest the legality of that conduct. Pp. 441 U. S. 111-115.

569 F.2d 1013, affirmed in part.

POWELL, J., delivered the opinion of the Court, in which BURGER, C.J., and BRENNAN, WHITE, MARSHALL, BLACKMUN, and STEVENS, JJ., joined.

Page 441 U. S. 93

REHNQUIST, J., filed a dissenting opinion, in which STEWART, J., joined, post, p. 441 U. S. 116.

MR. JUSTICE POWELL delivered the opinion of the Court.

Title VIII of the Civil Rights Act of 1968, 82 Stat. 81, as amended, 42 U.S.C. § 3601 et seq., commonly known as the Fair Housing Act of 1968 (Act), broadly prohibits discrimination in housing throughout the Nation. This case presents both statutory and constitutional questions concerning standing to sue under Title VIII.

I

Petitioners in this case are two real estate brokerage firms, Gladstone, Realtors (Gladstone), and Robert A Hintze, Realtors (Hintze), and nine of their employees. Respondents are the village of Bellwood, a municipal corporation and suburb of Chicago, one Negro and four white residents of Bellwood, and one Negro resident of neighboring Maywood. During

Page 441 U. S. 94

the fall of 1975, the individual respondents and other persons consulted petitioners, stating that they were interested in purchasing homes in the general suburban area of which Bellwood is a part. The individual respondents were not, in fact, seeking to purchase homes, but were acting as "testers" in an attempt to determine whether petitioners were engaging in racial "steering," i.e., directing prospective home buyers interested in equivalent properties to different areas according to their race.

In October, 1975, respondents commenced an action under § 812 of the Act, 42 U.S.C. § 3612, [Footnote 1] against Gladstone and its employees in the District Court for the Northern District of Illinois, alleging that they had violated 804 of Title VIII, 42 U.S.C. § 3604. [Footnote 2] Simultaneously, respondents filed a

Page 441 U. S. 95

virtually identical complaint against Hintze and its salespeople in the same court. The complaints, as illuminated by subsequent discovery, charged that petitioners had steered prospective Negro home buyers toward an integrated area of Bellwood approximately 12 by 13 blocks in dimension and away from other, predominately white areas. White customer, by contrast, allegedly were steered away from the integrated area of Bellwood. Four of the six individual respondents reside in this "target" area of Bellwood described in the complaint. [Footnote 3] The complaints further alleged that the

"Village of Bellwood . . . has been injured by having [its] housing market . . . wrongfully and illegally manipulated to the economic and social detriment of the citizens of [the] village,"

and that the individual respondents

"have been denied their right to select housing without regard to race and have been deprived of the social and professional benefits of living in an integrated society."

App. 6, 99. Respondents requested monetary, injunctive, and declaratory relief.

Petitioners moved for summary judgment in both cases, arguing that respondents had "no actionable claim or standing to sue" under the statutes relied upon in the complaint, that there existed "no case or controversy between the parties within the meaning of Article III of the Constitution," and that respondents failed to satisfy the prudential requirements for standing applicable in the federal courts. Id. at 78, 143. The District Judge presiding over the case against Gladstone and its employees decided that respondents were not within the

Page 441 U. S. 96

class of persons to whom Congress had extended the right to sue under § 812. The court expressly adopted the reasoning of TOPIC v. Circle Realty, 532 F.2d 1273 (CA9 1976), a case involving facts similar to those here. In TOPIC, the Ninth Circuit decided that Congress intended to limit actions under § 812 of the Act to "direct victims" of Title VIII violations, even though, under Trafficante v. Metropolitan Life Ins. Co.,409 U. S. 205 (1972), standing under § 810 [Footnote 4] of the Act, 42

Page 441 U. S. 97

U.S.C. § 3610, extends to the broadest class of plaintiffs permitted by Art. III. Since the individual respondents had been acting only as testers and thus admittedly had not been steered away from any homes they might have wished to purchase, the court concluded that they were, at most, only indirect victims of Gladstone's alleged violations of the Act. As respondents' action was brought under § 812, the court ruled that they lacked standing under the terms of the Act. The court did not discuss Gladstone's contention that respondents lacked standing under Art. III and the prudential limitations on federal jurisdiction. The District Judge presiding over the case against Hintze adopted the opinion of the Gladstone court as his own and also granted summary judgment.

The Court of Appeals for the Seventh Circuit consolidated the cases for appellate review. It first considered the significance of the fact that the individual respondents were merely testers not genuinely interested in purchasing homes. The court noted that while this precluded respondents from arguing that they had been denied their right to select housing without regard to race,

"the testers did . . . generate evidence suggesting the perfectly permissible inference that [petitioners] have been engaging, as the complaints allege, in the practice of racial steering with all of the buyer prospects who come through their doors."

569 F.2d 1013, 1016 (1978) (emphasis in original). Thus, although the individual respondents lacked standing in their capacity as testers, they were entitled to prove that the discriminatory practices documented by

Page 441 U. S. 98

their testing deprived them, as residents of the adversely affected area, "of the social and professional benefits of living in an integrated society."

The Court of Appeals then turned to the question whether the Art. III minima for standing had been satisfied. Observing the similarity between the allegations of injury here and those accepted as constitutionally sufficient in Trafficante, it concluded that the individual respondents had presented a case or controversy within the meaning of Art. III. The court also read the complaints as alleging economic injury to the village itself as a consequence of the claimed racial segregation of a portion of Bellwood. Although this aspect of the case was not directly controlled by Trafficante, the court found that the requirements of Art. III had been satisfied. [Footnote 5]

Having concluded that a case or controversy within the meaning of Art. III was before it, the Court of Appeals addressed the District Court's ruling that § 812 of the Act, unlike § 810, affords standing only to those directly injured by the discriminatory acts challenged. After considering the legislative history and recent federal court decisions construing these provisions, the court concluded, contrary to the decision in TOPIC v. Circle Realty, supra, that §§ 810 and 812 provide alternative remedies available to precisely the same class of plaintiffs. The conclusion of this Court in Trafficante that standing under § 810 extends "as broadly as is permitted by Article III of the Constitution,'" 409 U.S. at 409 U. S. 209, quoting Hackett v. McGuire Bros., Inc., 445 F.2d 442, 446 (CA3 1971), was seen as applicable to these cases brought under § 812. The Court of Appeals reversed the judgments of the District Court and remanded for further proceedings.

Petitioners sought review in this Court. We granted certiorari

Page 441 U. S. 99

to resolve the conflict between the decision of the Court of Appeals in this case and that of the Ninth Circuit in TOPIC, and to consider the important questions of standing raised under Title VIII of the Civil Rights Act of 1968. 436 U.S. 956 (1978). With the limitation noted in n 25, infra, we now affirm.

II

In recent decisions, we have considered in some detail the doctrine of standing in the federal courts.

"In essence, the question of standing is whether the litigant is entitled to have the court decide the merits of the dispute or of particular issues. This inquiry involves both constitutional limitations on federal court jurisdiction and prudential limitations on its exercise. . . . In both dimensions, it is founded in concern about the proper -- and properly limited -- role of the courts in a democratic society."

Warth v. Seldin,422 U. S. 490, 422 U. S. 498 (1975).

The constitutional limits on standing eliminate claims in which the plaintiff has failed to make out a case or controversy between himself and the defendant. In order to satisfy Art. III, the plaintiff must show that he personally has suffered some actual or threatened injury as a result of the putatively illegal conduct of the defendant. Duke Power Co. v. Carolina Environmental Study Group, Inc.,438 U. S. 59, 438 U. S. 72 (1978); Arlington Heights v. Metropolitan Housing Dev. Corp.,429 U. S. 252, 429 U. S. 260-261 (1977); Simon v. Eastern Kentucky Welfare Rights Org.,426 U. S. 26, 426 U. S. 38 (1976); Warth v. Seldin, supra at 422 U. S. 499; Linda R. S. v. Richard D.,410 U. S. 614, 410 U. S. 617 (1973). Otherwise, the exercise of federal jurisdiction "would be gratuitous, and thus inconsistent with the Art. III limitation." Simon v. Eastern Kentucky Welfare Rights Org., supra at 426 U. S. 38.

Even when a case falls within these constitutional boundaries, a plaintiff may still lack standing under the prudential principles by which the judiciary seeks to avoid deciding

Page 441 U. S. 100

questions of broad social import where no individual rights would be vindicated and to limit access to the federal courts to those litigants best suited to assert a particular claim. For example, a litigant normally must assert an injury that is peculiar to himself or to a distinct group of which he is a part, rather than one "shared in substantially equal measure by all or a large class of citizens." Warth v. Seldin, 422 U.S. at 422 U. S. 499. He also must assert his own legal interests, rather than those of third parties. [Footnote 6] Ibid.Accord, Arlington Heights v. Metropolitan Housing Dev. Corp., supra at 429 U. S. 263.

Congress may, by legislation, expand standing to the full extent permitted by Art. III, thus permitting litigation by one "who otherwise would be barred by prudential standing rules." Warth v. Seldin, 422 U.S. at 422 U. S. 501. In no event, however, may Congress abrogate the Art. III minima: a plaintiff must always have suffered "a distinct and palpable injury to himself," ibid., that is likely to be redressed if the requested relief is granted. Simon v. Eastern Kentucky Welfare Rights Org., supra, at 426 U. S. 38.

III

Petitioners have insisted throughout this litigation that respondents lack standing under the terms of the Act. Their argument, which was accepted by the District Court, is that, while § 810 provides standing to the fullest extent permitted by Art. III, see Trafficante v. Metropolitan Life Ins. Co., 409 U.S. at 409 U. S. 209, § 812, under which respondents proceed, affords standing only to "direct victims" of the conduct proscribed by Title VIII. Respondents, on the other hand, argue

Page 441 U. S. 101

that the Court of Appeals correctly concluded that §§ 810 and 812 are alternative remedies available to precisely the same class of plaintiffs. The issue is a critical one, for if the District Court correctly understood and applied § 812, we do not reach the question whether the minimum requirements of Art. III have been satisfied. If the Court of Appeals is correct, however, then the constitutional question is squarely presented. [Footnote 7]

Petitioners' argument centers on two points. First, § 810 uses the term "person aggrieved," defined as "[a]ny person who claims to have been injured by a discriminatory housing practice," to describe those who may seek relief under that section. By contrast, § 812 lacks this broad definition of potential plaintiffs, referring explicitly only to civil suits brought to enforce the rights granted elsewhere in the Act. Second, under § 810, a plaintiff must first seek informal conciliation of housing discrimination disputes from the Department of Housing and Urban Development (HUD) and appropriate state agencies before pursuing a judicial remedy. Seen 4, supra. But under § 812, a complainant may proceed directly to federal court.

From these facts, petitioners infer a congressional plan to create two distinct, though overlapping, remedial avenues under Title VIII. Under § 810, they argue, Congress intended to reach all victims -- both direct and indirect -- of housing discrimination by referring generally to those "aggrieved." But in order to protect the courts from the volume of litigation

Page 441 U. S. 102

such plaintiffs might generate, to make available the administrative expertise of state and federal agencies, and to involve state and local governments in national fair housing goals, Congress interposed administrative remedies as a prerequisite to the invocation of the federal judicial power by "indirect victims" of Title VIII violations.

Since § 812 does not specifically refer to "persons aggrieved," and allows direct access to the courts by those invoking it, petitioners argue that Congress must have intended this provision to be available only to those most in need of a quick, authoritative solution: those directly victimized by a wrongful refusal to rent or sell a dwelling place or by some other violation of the Act. The construction of § 812 accepted by the Court of Appeals, they contend, is illogical, because it would permit a plaintiff simply to ignore, at his option, the scheme of administrative remedies set up in § 810. Thus, according to petitioners, "direct victims" may proceed under either § 810 or § 812, while those injured only indirectly by housing discrimination may proceed, if at all, under the former provision alone.

Finally, petitioners claim that the legislative history of the Act supports their view. That history reflects that Congress was concerned that Title VIII not be used as an instrument of harassment. [Footnote 8] Petitioners contend that permitting individuals such as respondents, who have not been harmed directly by petitioners' alleged conduct, to invoke § 812 provides substantial opportunity for abuse of that kind.

We find this construction of Title VIII to be inconsistent with the statute's terms and its legislative history. Nothing in the language of § 812 suggests that it contemplates a more restricted class of plaintiffs than does § 810. The operative language of § 812 is phrased in the passive voice -- "[t]he rights granted by sectio[n] 804 . . . may be enforced by civil

Page 441 U. S. 103

actions in appropriate United States district courts" -- simply avoiding the need for a direct reference to the potential plaintiff. The absence of "person aggrieved" in § 812, therefore, does not indicate that standing is more limited under that provision than under § 810. To the contrary, § 812, on its face, contains no particular statutory restrictions on potential plaintiffs. [Footnote 9]

Contrary to petitioners' contention, § 810 is not structured to keep complaints brought under it from reaching the federal courts, or even to assure that the administrative process runs its full course. Section 810(d) appears to give a complainant the right to commence an action in federal court whether or not the Secretary of HUD completes or chooses to pursue conciliation efforts. [Footnote 10] Thus, a complainant under § 810 may

Page 441 U. S. 104

resort to federal court merely because he is dissatisfied with the results or delays of the conciliatory efforts of HUD. [Footnote 11] The most plausible inference to be drawn from Title VIII is that Congress intended to provide all victims of Title VIII violations two alternative mechanisms by which to seek redress: immediate suit in federal district court or a simple, inexpensive, informal conciliation procedure, to be followed by litigation should conciliation efforts fail. [Footnote 12]

Page 441 U. S. 105

Although the legislative history gave little help in determining the proper scope of standing under § 810, see Trafficante, 409 U.S. at 409 U. S. 210, it provides substantial and rather specific support for the view that § 810 and 812 are available to precisely the same class of plaintiffs. [Footnote 13] Early legislative proposals for fair housing legislation contained no administrative remedies. [Footnote 14] The nonjudicial avenue of relief was later added on the theory that it would provide a more expeditious and less burdensome method of resolving housing complaints. [Footnote 15]

Page 441 U. S. 106

There is no evidence that Congress intended to condition access to the courts on a prior resort to the federal agency. To the contrary, the history suggests that all Title VIII complainants were to have available immediate judicial review. The alternative, administrative remedy was then offered as an option to those who desired to use it.

This apparently was the understanding of Representative Celler, who, as chairman of the House Judiciary Committee, summarized the Act on the floor of the House. [Footnote 16] Similar perceptions were reflected in reports on the proposed legislation by the Department of Justice [Footnote 17] and the House Judiciary

Page 441 U. S. 107

Committee. [Footnote 18] HUD, the federal agency primarily assigned to implement and administer Title VIII, consistently has treated §§ 810 and 812 as alternative remedial provisions. [Footnote 19] Under familiar principles, see Teamsters v. Daniel,439 U. S. 551, 439 U. S. 566 n. 20 (1979); Udall v. Tallman,380 U. S. 1, 380 U. S. 1 (1965), and as we stated in Trafficante, supra at 409 U. S. 210, the agency's interpretation of the statute ordinarily commands considerable deference.

Petitioners have identified nothing in the legislative history contrary to this view. Their reliance on the expressed intent that Title VIII not be used for harassment is unconvincing. Nowhere does the history of the Act suggest that Congress attempted to deter possible harassment by limiting standing under § 812. Indeed, such an attempt would have been

Page 441 U. S. 108

pointless, given the relatively easy access to the courts provided by § 810. [Footnote 20]

Most federal courts that have considered the issue agree that §§ 810 and 812 provide parallel remedies to precisely the same prospective plaintiffs. E.g., Wheatley Heights Neighborhood Coalition v. Jenna Resales Co., 429 F.Supp. 486, 489-492 (EDNY 1977); Village of Park Forest v. Fairfax Realty, P-H 1 EOHC

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