GUEST COLUMN
A contractor’s guide to the North Carolina
Fair Housing Act: Avoiding costly mistakes
By Luke J. Farley Sr.

Special to North Carolina Construction News
When you think about the
statutes and codes that govern the
construction and design process in
North Carolina, does the North Car-
olina Fair Housing Act (NCFHA)
come to mind? Probably not—but it
should, or you may be opening your
business up to an expensive risk.

According to Lawyers Weekly, in
2016 one of the largest settlements
in our state resulted from a con-
struction and design dispute under
the NCFHA. The developers,
builders, and architects of the Sky-
House high rise apartments in
Raleigh and Charlotte agreed to pay
$1.8 million to correct sliding door
thresholds which were inaccessible
to people with disabilities.

Numerous other cases around
the country have resulted in own-
ers, contractors, and designers pay-
ing out hundreds of thousands of
dollars and sometimes even mil-
lions. You can’t afford to be un-
aware of this law.

Fair housing law basics
The NCFHA is relatively short.

This state law shouldn’t be con-
fused with the better-known federal
Fair Housing Act. The federal
statute, however, allows individual
states to adopt and enforce their
own comparable statute instead of
relying on the federal act.

Our state’s fair housing laws are
enforced by the N.C. Human Rela-
tions Commission, a state govern-
ment agency within the Office of
Administrative Hearings. The com-
mission has a professional staff of
investigators and attorneys as well
as commissioners appointed by the
governor and legislature. Enforce-
ment is carried out by commission
staff and complaints are heard by
the commission.

Because there aren’t many cases
interpreting the NCFHA, the Human
Relations Commission relies heavily
on federal case law, regulations,
and guidance prepared by the U.S.

Department of Housing and Urban
Development (HUD) and the U.S.

Department of Justice (USDOJ).

The most important thing to
know about the NCFHA is how
broad it is. The act outlaws a wide
range of discriminatory housing
practices based on race, color, reli-
gion, sex, national origin, handicap-
ping condition or familial status. The
act creates a private right of action
for any person who claims to have
been injured by any person who en-
gages in practices prohibited by the
act. Potential claimants could in-
clude buyers, sellers, and tenants.

Respondents could include sell-
ers, mortgage brokers, real estate
agents, landlords, and property
management companies. The differ-
ent combinations of potential
claims, claimants, and respondents
allowed under the NCFHA is practi-
cally limitless.

Design and construction standards
As far as contractors and design-
ers are concerned, the law’s key
provision is a section that makes it
“an unlawful discriminatory housing
practice to fail to design and con-
struct covered multifamily
dwellings” according to seven dif-
ferent handicap accessibility stan-
dards. A dwelling (including common
areas) is covered if it has four or
more units and an elevator. If the
building has four or more units but
10 — February – March 2019 — The North Carolina Construction News
lacks an elevator, then only the
ground floor units and common
areas will be covered. In other
words, if a building only has stairs
but no elevators, then only the
ground floor units must comply
with the design standards.

A wide variety of buildings and
facilities are covered, including con-
dominiums, cooperatives, apart-
ment buildings, vacation and time
share units, assisted living facilities,
continuing care facilities, nursing
homes, public housing develop-
ments, transitional housing, single
room occupancy units (SROs),
homeless shelters, dormitories,
hospices, extended stay or residen-
tial hotels, mobile home parks, and
more. In short, if you’re in the busi-
ness of building multifamily hous-
ing, you must be familiar with the
requirements of the NCFHA.

The act includes these require-
ments: • a building entrance on an “acces-
sible route;”
• public and common areas readily
accessible and usable by handi-
capped people;
• an “accessible route” into and
through all dwellings and units;
• doors wide enough to accommo-
date wheelchairs;
• light switches, electrical outlets,
and thermostats in “accessible
locations;” • bathroom walls reinforced so as
to allow the installation of grab
bars; and
• space in the kitchens and bath-
rooms to allow a person in a
wheelchair to maneuver.

Note, though, the seven stan-
dards are only stated in general
terms. For instance, the statute isn’t
specific as to exactly how wide a
door needs to be to accommodate
a wheelchair or where exactly light
switches need to be located. These
requirements are outlined in section
R321.3 of the North Carolina Resi-
dential Building Code, which is



based on specifications from the
American National Standards Insti-
tute (ANSI).

Common design and construc-
tion violations include building en-
trances having only steps but no
ramps, door thresholds being too
high and without a bevel, outlets
placed too low, and switches placed
too high. Unlike other provisions of
the NCFHA, proof of a violation
doesn’t require a showing of dis-
criminatory intent or effect; failure
of the dwelling to meet the stan-
dards is enough.

Broad liability for owners, designers,
and contractors
Who in the construction process
is responsible for complying with
the design and construction stan-
dards? The owner? The designer?
The contractor? The statute doesn’t
say explicitly. Federal courts have
long held that a defendant doesn’t
need to both “design and construct”
a covered building in order to be li-
able. If a building is inaccessible to
handicapped residents, you’d expect
the residents to seek relief against
the owner or the landlord. You’d
then expect the owner or landlord to
go after the designer as the party re-
sponsible for designing the project
and ensuring accessibility.

Accessibility would seem to be
entirely a question of design. A con-
tractor, on the other hand, would
seem to have no liability for accessi-
bility. Under the venerable Spearin
doctrine a contractor is only re-
quired to build the project according
to the plans designed the by archi-
tect and provided by the owner. A
contractor is seemingly the least
culpable party when design stan-
dards aren’t met.

But the current practice of the
N.C. Human Relations Commission
staff, supported by federal case law,
is to seek relief against all the major
parties involved in the project—
owner, designer, and contractor.

Neither the North Carolina statute
nor state decisional law specifically
authorizes this practice. However,
federal courts interpreting the fed-
eral act have determined that a con-
tractor can (surprisingly) be held li-
able even if the contractor did noth-
ing more than build the project
according to plans designed by
someone else.

The rationale for this approach is
that the Fair Housing Act is remedial
in nature and a strict interpretation
of the act will result in compliance
with the law and an increase in
available housing for handicapped
individuals. Even so, this approach
totally upends the traditional divi-
sion of responsibilities on a design-
bid-build construction project.

Despite this persuasive authority,
a contractor facing a claim under
the NCFHA should still raise a de-
fense based on the implied war-
ranty of plans and specifications.

This defense is well established
under North Carolina law.

Two key defenses
There are two key NCFHA de-
fenses: (1) showing the project is
exempt from the accessibility stan-
dards and (2) showing the project
was designed and built according to
a safe harbor building code.

The strongest defense is to show
a project isn’t subject to the act.

While most multifamily projects will
be covered, the design standards
don’t apply to single-family homes,
duplexes, or triplexes. Commercial
buildings like offices, stores, ware-
houses, etc., are also explicitly ex-
empt. The other important defense is
compliance with the safe harbor de-
sign standards, which applies if a
state adopts one of 10 design
codes recognized by HUD without
any changes and the project is built
2018-2019 edition
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