STATE OF WISCONSIN
LABOR AND INDUSTRY REVIEW COMMISSION
WILLIE H. DAVIS, JR., Complainant
MARTHA PIECHOWSKI, Respondent
FAIR EMPLOYMENT DECISION
ERD Case No. 8451599, HUD #05-8408-733-200
An examiner of the Department of Industry, Labor and Human Relations issued a decision in the above-captioned matter on August 30, 1985. Respondent filed a timely petition for review of the examiner's decision and both parties subsequently submitted written arguments to the Commission.
Based upon a review of the record in its entirety, the Labor and Industry Review Commission issues the following:
The decision of the examiner is amended as follows:
1. In FINDING OF FACT number 13, delete "rent her property to" and substitute therefor "negotiate for rental her property with".
2. In FINDING OF FACT number 14, delete "rent to" and substitute therefor "negotiate with".
3. Insert on page 3, immediately following FINDING OF FACT number 14, the following paragraph:
"Respondent intentionally refused to answer the doorbell and to show the property to Complainant because of Complainant's race and Respondent's racial animus."
4. In the first line under CONCLUSION OF LAW, delete "rent" and substitute therefor "discuss the terms of rental of"; and delete the second "to" and substitute therefor "with".
5. Insert between the first and second paragraph, under CONCLUSION OF LAW, the following paragraph:
"Respondent wilfully refused to discuss the terms of rental of her property with Complainant because of Complainant's race in violation of Sec. 101.22, Wis. Stars."
6. In the second line of the second paragraph under ORDER, delete "rent to" and substitute therefor "discuss the terms of rental with".
7. Insert in the second paragraph under ORDER, immediately following the first sentence, the following:
"Interest shall be added to the $174 and the extra mileage expenses. Interest shall be computed at an annual rate of 12 percent simple interest and shall be computed by calendar quarter."
8. Paragraph 3 of the Examiner's Order is deleted and the following paragraph substituted therefor:
"That Respondent forfeit the amount of $1,000 to the State of Wisconsin. The forfeiture shall be made payable to the State Treasurer and should be sent to Kendra DePrey, Labor and Industry Review Commission, P. O. Box 8126, Madison, Wisconsin 53708 within 30 days of the date of this Order."
9. Insert between the fourth and fifth paragraphs under ORDER:
"4a. Attorney's fees incurred by Complainant in pursuing this matter shall be increased to reflect additional fees incurred, if any, in proceedings before the Commission."
10. Paragraph 5 of the Examiner's Order is deleted and the following paragraph substituted therefor
"That Respondent shall within 30 days of the expiration of time within which an appeal may be taken herein, submit a compliance report detailing the specific action taken to comply with the Commission's Order. The compliance report shall be directed to the attention of Kendra DePrey , Labor and Industry Review Commission on, P. O. Box 8126, Madison, Wisconsin 53708."
As amended, the examiner's decision shall stand as the FINAL ORDER herein.
Dated and mailed October 24, 1986
/s/ David A. Pearson, Chairman
/s/ Hugh C. Henderson, Commissioner
/s/ Carl W. Thompson, Commissioner
To comport with the facts of this case, the Commission has amended the examiner's decision to find a refusal to discuss terms rather than a refusal to rent. A "refusal to rent requires both a bona fide offer and that the offer be made by a qualified person but neither is required for a refusal to negotiate." Joplin v. Missouri Comm. on Human Rights, 642 S.W. 2d 370 (1982); United States v. Youritan Construction Company, 370 F. Supp. 643, 650 (N. D. Calif. 1973 . "Respondent had a duty to at least discuss the rental with Johnson to see if she was qualified and not to mislead her as to the availability of the house. The false statement of an owner that a dwelling is no longer available is a refusal to negotiate under discriminatory housing acts." Joplin v. Missouri Comm. on Human Rights, supra; Howard v. W. P. Bill Atkinson Enterprises, 412 F. Supp. 610, 612-613 (W. D. Okla. 1975). In this case, no bona fide offer was made because the circumstances precluded opportunity for an offer and because of Piechowski's false statement to Davis that the dwelling was no longer available.
Department's Authority to Make Monetary Awards.
The parties briefed and argued the issue of whether the Department has authority to award out-of-pocket expenses, attorney's fees and costs to a prevailing Complainant even though the Open Housing Law contains no express statutory language authorizing such awards.
The Wisconsin Open Housing Law (Sec. 101.22, Wis. Stats.) is intended to render unlawful discrimination in housing and specifically proscribes such discrimination as unlawful. (Sec. 101.22 (1) and (2).) The Law declares a state policy that all persons have an equal opportunity for housing. (Sec. 101.22 (1) .) It imposes a duty on local. units of government to assist in preventing or removing all housing discrimination. (Sec. 101.22 (1).) It specifically provides that the OHD is to be deemed an exercise of the police powers of the state for the protection of the welfare, health, peace, dignity and human rights of people (Sec. 101.22 (1)). The Law sets up a scheme to realize this exercise of the state's power and policy.
The scheme includes administration by the Department of Industry, Labor and Human Relations. (Sec. 101.22 (3).) The Department makes rules concerning housing discrimination (Sec. 101.22 (3)). The Department also receives, investigates and conciliates discrimination complaints. (Sec. 101.22 (4).) It may initiate investigations, tests, studies and complaints. (Sec. 101.22 (4)(b).) The Department may seek temporary relief in a circuit court, pending final determination of proceedings. (Sec. 101.2? (4)(e).) The Department also adjudicates complaints. (Sec. 10 1.22 (4) . )
A person claiming housing discrimination may file a complaint with the Department (Sec. 101.22 (4)) or the person may bring a civil action in circuit court (Sec. 101.22 (7)). When a complaint is filed with the Department, the Department then can hold hearings, issue subpoenas, take testimony and make investigations (Sec. 101.22 (4)(a)) or seek temporary relief in a circuit court (Sec. 101.22 (4)(e)). Following investigation an equal rights officer or the Department issues an initial determination finding probable cause or no probable cause. (Sec. 101.22 (4)(d).) Willie Davis, Complainant, filed his complaint with the Department and also brought a civil action in circuit court.
Once an initial determination finding probable cause is issued, the Department can take various steps. It can attempt to remedy the unlawful practice through conference, conciliation, or persuasion. (Sec. 101.22 (4)(d).) It can issue and serve a notice of hearing requiring Respondent to answer the complaint at a hearing. (Sec. 101.22 (4)(d).)
The Department adjudicates complaints by holding hearings. Department hearings are full evidentiary proceedings conducted in accordance with the Wisconsin Administrative Procedure Act (Sec. Ind 89.12, Wis. Adm. Code, Ch. 227, Wis. Stats.) The hearings are presided over by an administrative law judge. If a remedy is appropriate, the administrative law judge may "order such action by the respondent as will effectuate the purpose of this section." (Sec. 101.22 (4)(d).) Either party may then file a petition for review by the Commission (Sec. 101.22 (4p). The Commission may modify, set aside or affirm the findings and order of the administrative law judge, or direct the taking of additional evidence. Subsequently a petition for review may be filed in circuit court where a trial de novo on all issues relating to any alleged discrimination is held. The parties have a right to jury trial. Maximum costs of $100 plus witness fees may be taxed to the prevailing party (Sec. 101.22 (5)).
A victim following the dual route of a private civil action under sec. 101.22 (7) may seek injunctive relief, damages (including punitive damages), court costs and reasonable attorney fees.
In this case the administrative law judge held a hearing and issued a decision, amended and affirmed by this Commission, holding that Piechowski discriminated against Davis by refusing to discuss the terms of rental of her property with Davis. Piechowski has been ordered to cease and desist from refusing to rent to Davis on the basis of race, and to pay Davis' out-of-pocket expenses, prejudgment interest, attorney's fees and costs. A $1,000 forfeiture was imposed against Piechowski.
The Commission has determined that the Department has authority to award out-of-pocket expenses, prejudgment interest, attorney's fees and costs to a prevailing complainant.
Since the Department's authority must come from the Law, the issue is, does the Law give the Department the power to award damages, interest, attorney's fees and costs?
The basic administrative remedy section of the Law, sec. 101.22 (4)(d), states:
". . . If, after the hearing, the examiner finds by a fair preponderance of the evidence that the respondent has engaged in discrimination in violation of this section, the examiner shall make written findings and order such action by the respondent as will effectuate the purpose of this section..." "...If the complaint is dismissed, costs in an amount not to exceed $100 plus actual disbursements for the attendance of witnesses may be assessed against the department in the discretion of the department ."
The statute does not mention damages, interest, costs , or attorney's fees. In fact, the statute mentions no specific remedy to be awarded a prevailing complainant. However, the statute's language is expansive. No explicit limitation is placed on the type of remedies allowed. Thus, the plain language of the statute seems to allow the type of remedies at issue, if in the judgment of the Department such remedies are necessary.
In construing a statute, the objective is to discern the intent of the legislature. Watkins v. LIRC, 117 Wis. 2d 753, 761 (1984). "The cardinal rule in interpreting statutes is that the purpose of the whole act is to be sought and is favored over a construction which will defeat the manifest object of the act. T. A. Sutherland, Statutory Construction, (4th Ed. 1973), Sec. 46.05." (Student Asso., U. of Wis.-Milw. v. Baum, 74 Wis. 2d 283, 294-5 (1976).) "The statutes are to be construed to avoid an unreasonable and absurd result." (Schwartz v. ILHR Dept., 72 Wis. 2d 217, 222 (1976).)
When weighing the merits of the different interpretations of the Law advanced by the parties, the purpose of the Act must be kept in mind. Anderson. v. LIRC, 111 Wis. 2d 245, 254 (1983). The purpose, which is stated in the Law itself is "that all persons shall have an equal opportunity for housing . . . This section shall be deemed an exercise of the police powers of the state for the protection of the welfare, health, peace, dignity and human rights of the people of this state." Sec. 101.22 (1). The stated intent behind the Law is to discourage discriminatory practices. Moreover a person discriminated against should be "made whole." Anderson v. LIRC, supra at 259. See also Watkins v. LIRC, 117 Wis. 2d 753, 763 (1984).
Awarding out-of-pocket expenses, prejudgment interest, attorney's fees and costs are effective remedies that will discourage discrimination. The Wisconsin Supreme Court in Anderson v. LIRC, supra, held that prejudgment interest should be awarded discrimination victims. In Watkins v. LIRC, supra, the Supreme Court recognized that in order to make whole a victim of discrimination and to discourage discriminatory practices in employment, attorney's fees could be awarded and held that such awards were necessary to fully enforce and give meaning to the rights created under the Fair Employment Act to prevent victims from being deterred because of substantial attorney's fees. The intent of the FEA is the same as that of the OHL -- the discouragement of discriminatory practices.
Various reasons establish that these awards are a necessary and effective remedy. There are only so many ways of combatting discrimination: The Department can attempt to educate those who do not understand, punish those who do discriminate, and deter those who might discriminate.
Although education, conference and conciliation are important goals of the law, in many cases those procedures are not effective and the victim is forced to "litigate." When this occurs awards of damages, prejudgment interest, attorney's fees and costs are effective at both punishing and deterring. If landlords are forced to compensate for all the effects of their unlawful acts, if they are hit in the pocketbook where it hurts, they will be less likely to discriminate in the future. Monetary awards will not only deter the wrongdoers, it will send a message to other landlords that they must pay for the consequences of their discrimination. The state's policy goal that all persons be able to seek and secure housing without discrimination will have a better chance of being effectuated.
Furthermore, the availability of these monetary awards may actually aid in the important conference and conciliation goals of the Law. Landlords may be more willing to confer and negotiate if they know that the Department can impose monetary awards against them. The entire Law is made more effective if the Department has a full complement of remedies.
Thus, the plain language and purposes of the Law are evidence that the Legislature intended to allow the Department to make monetary awards.
Piechowski argues that the Legislature did not intend to allow the Department to award monetary relief. To support this, Piechowski looks at two indicators, a comparison with the state's Fair Employment Act and a comparison with the private civil action subsection of the OHL. Piechowski argues that under the Fair Employment Act case of Watkins, the administrative route was the only avenue open to Watkins for redress of the discriminatory wrongs as the FEA has no provision for a separate civil action, whereas the OHL provides for a separate civil action in Sec. 101.22 (7). This subsection allows a court to award "appropriate injunctive relief, ...damages, including punitive damages, and ...court costs and reasonable attorney fees". She contends that the Legislature knows how to specifically provide for monetary awards when it wants to, and since those damages are not mentioned in the administrative route section, they are not available.
An early version of the OHL did not provide the dual parallel routes for resolution of claims. It provided only for the administrative route with appeal to circuit court, trial de novo and right to jury trial. Chapter 188, L. 1979 (SB 244) amended the Law to provide the direct judicial route. The Act itself provided no reasons for the amendment. The LRB analysis stated: "Victims of housing discrimination are permitted to bring private civil actions for injunctive relief and damages. There is a 3-year deadline for filing suit." (The administrative route has a 300-day statute of limitations.) That each of the routes was conceived separately provides an explanation for why one explicitly allows monetary awards and the other is silent. Furthermore, arguing that the absence of specific mention of damages in the administrative route subsections is significant ignores the fact that when the Legislature wants to limit an agency's discretion it obviously knows how to do so; expansive language is not the way.
The employment act remedy provision allows the Department to "order such action by the Respondent as will effectuate the purpose of this subchapter . . ." (Sec. 111.39 (4)(c).) The language is virtually identical to that of the Open Housing Law. This language has been interpreted as providing the Department with authority to award reasonable attorney's fees to a prevailing complainant in a FEA case. Watkins v. LIRC, supra. The FEA does not expressly provide for interest an back, pay awards. In Anderson v. LIRC, supra, the Wisconsin Supreme Court construed the FEA as granting authority to the department to award prejudgment interest based on the rationale that the person discriminated against should be "made whole." (Id at p. 259.) The court considered that increasing back pay awards to carry an accrual of prejudgment interest is consistent with the rules for awarding prejudgment interest in Wisconsin, i.e. , prejudgment interest may be recoverable where the amount due, though not truly liquidated, is capable of determination by application of some fixed standard. (Id at p. 260.) The out-of-pocket expenses in the present case also are capable of determination by application of a fixed standard.
The intent and the remedial language of the FEA and the OHL are virtually identical. Therefore the court's rationale in Watkins and Anderson is to be applied with equal force in this case. If the Department is already empowered to make monetary awards in employment cases, then arguments that the Department lacks adequate procedure and that there is little if any precedent for this type of award are weakened. It is difficult to see why there would be less reed to make whole a victim of housing discrimination than a victim of employment discrimination.
Piechowski argues that under the OHL, a complainant can be made whole by taking the direct judicial route and therefore there is no necessity for the construction given the FEA to be applied to the OHL. Two parallel routes are provided for resolution of claims order the state's OHL: an administrative route and a judicial route. Since the Legislature has already provided that monetary awards are available in the direct judicial route, a problem of equal protection might arise if those awards were not available to the Department; similarly situated complainants might receive different relief depending on which forum and route they used.
Piechowski also argues that being made whole includes actual damages as well as the out-of-pocket expenses, attorney's fees and costs awarded in this case, and that neither punitive damages nor emotional distress damages were awarded. Davis did seek reimbursement of wages for time taken off work and damages for emotional harm, for denial of interracial living and for denial of unique property. The administrative law judge did not address these issues and neither granted nor denied an award for such compensatory damages. Davis never sought punitive damages. However, Davis failed to timely file a petition for review on these issues. Therefore, the Commission will not address them.
Piechowski argues that the American rule is applicable, i.e., that a prevailing litigant ordinarily is not entitled to collect a reasonable attorney's fee and expenses from the opposing party as part of damages or costs awarded. Cedarburg L. & W. Conn. v. Glens Falls Ins. Co., 42 Wis. 2d 120 (1959) is cited as authority therefor. In Watkins, supra, at p. 758, the court's response to this argument was as follows: "However, in Cedarburg , we recognized that there are various exceptions to and modifications of this rule. We also noted that the American rule does not apply when there are contractual or statutory provisions authorizing the recovery of attorney's fees by a prevailing litigant." The court went on to find that the FEA statutory provisions authorized such recovery. In the present case, the Commission finds that the OHL statutory provisions authorize such recovery.
Apart from discussions of legislative intent, there is a strong reason in favor of the Department's power to make monetary awards. Two avenues of relief are available under the Law -- administrative and judicial procedures. The Legislature has already provided that monetary awards are available to those who can pursue the direct judicial route remedy. Allowing monetary award to one group of aggrieved complainants but denying them to another creates a disparate situation that may ultimately frustrate, rather than effectuate, the purposes of the Law.
If the Department could :gnot make monetary awards, there would be incentive for complainants to bypass the administrative forum. More cases would be brought to an already crowded system. This would also have the effect of eliminating the possibility of conference and conciliation, goals which are crucial to the Law. Moreover, there would be no apparent purpose for the Department's investigating and hearing complaints and no apparent purpose for the creation of the administrative forum by the Legislature. The Legislature could not have intended creation of that forum as a meaningless, empty gesture. As stated by the Supreme Court in Watkins, supra, p. 765:
". . . One of the more invidious aspects of discrimination is that its targets are frequently the economically weak, who are often unable to afford the assistance of counsel. Without the assistance of counsel, the ability to vindicate one's rights under the Act is so impaired that it renders the existence of those rights nearly meaningless. Where, as here, the relief sought includes no back pay from which a complainant could pay attorney's fees, even a complainant with some economic means who faces the prospect of substantial attorney's fees may well be deterred from enforcing those rights guaranteed under the Act. The legislature clearly could not have intended that result in either situation."
Different remedies in different forums might also create two categories of claimants: those who cannot afford to take their own case to court and thus need the Department to pursue their claim will not be entitled to full relief, regardless of the merit of their claim; those who can afford to hire a private lawyer and file a civil action will have the chance to be completely compensated. Distinguishing between complainants not on the merit of their claims but on their ability to afford a private attorney is not desirable and might create equal protection problems. This practical concern, combined with the other indicators of legislative intent, leads to the Commission's conclusion that the Department has authority to award compensatory damages.
Piechowski argues that if complainants taking the administrative route are to be entitled to monetary awards, the Legislature must explicitly authorize the use of such awards before they can to used by the Department.. The Commission disagrees with this contention because the statutory authority to make such awards is inherent in the Law. The Department shall "...order such action by the respondent as will effectuate the purpose of this section." The Legislature explicitly delegated the power to the Department to determine what remedies would effectuate the purposes of the Law; the Department (Commission) has acted pursuant to this delegation of power. Respondent's contention is a weak argument where the purpose of the Law would be accomplished and the problem being combated demands remedies. Moreover Respondent's argument has already been eroded, the Department has the authority to make these monetary awards in employment cases.
Based on the language of the Open Housing Law and the Commission's consideration of the various arguments, the Commission believes it has authority to make the monetary awards awarded in this case.
Respondent argues that imposition of the $1,000 maximum forfeiture is not justified in this case.
Section 101.22 (6)(a), Wis. Stets., provides for imposition of a forfeiture of not less than $100 nor more than $1,000 for a wilful violation of the OHL if such violation is a first violation. (A subsequent violation calls for a $1,000 to $10,000 forfeiture.)
In Cahill v. Cahill , 26 Wis. 2d 173 (1965), a divorce action for wilful desertion, the Wisconsin Supreme Court equated "wilful" with "willingly." The Court quoted from its definition of "wilful" in Milwaukee Corrugating Cc. v. Ind. Com., 197 Wis. 414, 420 (1928), as follows:
"The words "wilful" and "wilfully" are of somewhat varied signification according to the context in which they are used in particular cases and the nature of the subject under discussion or treatment. They are frequently used in the sense of intentionally, or in other words as implying a purpose or design, or proceeding from a conscious motion of the will as distinguished from accidentally or involuntarily; and they are accordingly used in the sense of or as equivalent to willingly; designedly; purposely; obstinately; stubbornly; inflexibly; perversely; voluntarily; deliberately; with set purpose; being governed by the will, without regard to reason, or without yielding to reason..."
Milwaukee Corrugating is a worker's compensation. case. The quote in Milwaukee Corrugating is taken from State v. Preston , 34 Wis. 675, 684 (1874). As the definition states, the definition is dependent upon the context in which the word is used and the nature of the case. State v. Preston was an action concerning a forfeiture to be recovered by civil action for wilful obstruction of a highway. There the Court determined that the actor must not only intend to perform the action, but must also at the time have a knowledge of the character of the action.
In this case Mrs. Piechowski intentionally refused to answer the doorbell and to show the unit to the Davises only because of their race and her racial animus. Under such circumstances her illegal actions were wilful.
The legislative intent to deter conduct which discriminates in housing is expressly stated in sec. 101.22 (1) .
Respondent has cited no cases on whether or not imposing a forfeiture amount within the range set by the Legislature would be deemed an abuse of discretion. The assessment of forfeitures within the statutory range lies within the sound discretion of the agency. See State v. Weller , 109 Wis. 2d. 605, 673 (1982); State v. City of Monona, 63 Wis. 2d 67 (1974).
The administrative law judge imposed the forfeiture because of the egregious form of discrimination in this case, i.e., Piechowski refused to permit the Davises to view the rental unit as soon as she discovered the Davises were black -- she judged them solely on their color.
The Davises were at Piechowski's for about one and a half hours. They sat in their van with the door and windows open. They rang the doorbell many times, waiting for a response. They walked around the outside of the property. They discovered Piechowski lied about the availability of the rental unit and made racially derogatory remarks about them to a third person, the rental agent. They suffered a fundamental loss of dignity and personal integrity as a result of Piechowski's actions. They were humiliated, shocked and embarrassed by Piechowski's blatant misrepresentations and bigotry.
Piechowski refused to permit the Davises to view the premises when she became aware that they were black. Piechowski refused to make any determination as to whether Davis was a qualified prospective tenant. She lied to Davis about the availability of the rental unit and made racially derogatory remarks about Davis to a third person. The Commission therefore agrees with the administrative law judge that the maximum penalty is justified in this case.
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