New Jersey Coalition of Rooming and Boarding House Owners v. Mayor and Council of Asbury Park

152 F.3d 217 (3rd Cir. 1998)
  • Opinion Date: July 30, 1998

FAIR HOUSING; ROOMING AND BOARDING HOUSES—Owners of existing rooming and boarding houses have standing to challenge certain regulatory restrictions even if their status is grandfathered. The award of compensatory damages is mandatory, not discretionary, under the Fair Housing Amendments Act.

An association representing owners of rooming and boarding houses, together with a number of individual residents, sued to have the Rooming and Boarding House Municipal Licensing Law and certain municipal ordinances declared unconstitutional under the United States and New Jersey Constitutions, and invalid under both the New Jersey Law Against Discrimination and the Fair Housing Amendments Act of 1988 (FHAA). The District Court held that the plaintiffs lacked standing as to certain claims because of the grandfathering provisions in the law and also declined to award compensatory damages under the FHAA holding that an award of damages was discretionary. The Third Circuit reversed the District Court on both grounds.

The distance provision of the licensing law, (which was a claim for which the District Court found no standing), stated that no license shall be issued for any rooming and boarding house when any part of the boundary line of any other rooming and boarding house is within a certain distance. The owners asserted that this provision was patently unconstitutional. The District Court’s determination that the owners lacked standing was based upon the licensing law’s clause that exempted all existing rooming and boarding homes from that provision. It reasoned that there was no way the existing owners or residents could be harmed by this provision. The Third Circuit determined that the District Court made insufficient findings of fact and remanded the case because of evidence in the record that the rooming and boarding housing stock in the municipality declined in value and other detrimental effects had occurred as a result of the licensing law. It also determined that while the language of the FHAA appears to allow for a discretionary award of compensatory damages, the award of compensatory damages actually is mandatory under the FHAA.