PKU-STL HuChapter 7 Leasing Real PropertyA. History1. Traditionally, a leasehold was seen as an estate in land - a nonfreehold estate. Thus, the lease was governed by property law concepts.2. Today, most jurisdictions view the lease as a hybrid, governed by both property law and contract law.3. The landlord-tenant revolution: the rights of a residential tenant today are much greater than they were 50 years ago.4. Immutable rules: supersede any contract provisions in the leaseDefault rules: fill in the gap that the parties did not address in the leaseB. Creating a tenancy1. Selecting the tenant(1) Traditionally a landlord can refuse to rent to anyone for any reason (even no reason). But modern federal and state statutes which prohibit discrimination have limited this rule.(2) CRA (Civil Rights Act of 1866):a. Just apply to racial discrimination.b. Not very effective after its passage, since it was seen as prohibiting state discrimination but not private discrimination.c. Jones v. Alfred H. Mayer CO. (392 U.S. 409):interpreted the Civil Rights Act of 1866 to regulate private discrimination as well as prohibiting public laws mandating racial discrimination.(3) FHA( Fair House Act of 1968): a. Today, the Fair Housing Act prohibits discrimination based on race, color, religion, sex, national origin, disability ("handicap"), and familial status (families with children).b. Policy arguments against FHA: inefficient transactionc. Only apply to dwellingsd. Some exemptions: 1) Rooms or units in dwellings containing living quarters occupied by no more than four families living independently of each other, if the owner occupies one of such living quarters as his residence 2) Any single-family house sold or rented by an owner. The "single-family house" exception applies only if 1) the owner owns no more than three such homes; 2) the owner does not use a broker; and 3) he has not posted a discriminatory advertisement, posting, mailing, or notice in violation of section 3604(c).3) Other exemptions: Religious organization and private clubsNote: These exemptions don’t apply to the prohibition on discriminatory advertising. And they are exemptions of FHA not CRA.(4) Neithamer v. Brenneman Property Services, Inc. (1999, United States District Court)a. Facts: P(gay and HIV positive) applied to rent a house from D. D rejected P’s offer. Then P offered to pay a second month’s rent and later even pre-pay one year’s rent. D still rejected P without reason. P wanted to know why but was threatened by D.b. Issue: whether P has provided enough evidence to give rise to an inference that D perceived he was HIV and whether P show either that D’s reasons are pretext or that material facts are disputed.c. Rule: First, P must establish a prima facie case of discrimination by showing four elements: 1) P is a member of a protected class and D knew or suspected that he was; 2) P applied for and was qualified to rent the property in question; 3) D rejected his application; and 4)property remained available thereafter. Once P establishes a prima facie case, the burden shifts to D to articulate some legitimate, nondiscriminatory reason for their rejection of P’s application. If D satisfies this burden, P must show either that D’s reasons are pretext or that material facts are disputed.Note: We are just at summary judgment stage. All P does is to preclude summary judgment.d. Reasoning: 1) In FHA, there is nothing about sexual orientation discrimination, so P can just have a handicap claim(HIV).2) P had told D that his lover died of AIDS. And D likely suspected that P had had sexual relations with his lover and thus became exposed to AIDS virus.3) A material disputed fact: There are enough clues to allow a reasonable jury to conclude that D suspected that P was infected with HIV or AIDS.4) D’s reasons: P’s credit was poor. D was just an agent of Stephens (the owner of the property) and the decision was made by Stephens.5) P’s evidence to show that D’s reasons are just pretext: D did not consistently follow their own policy about poor credit and D did not present Stephen with all of P’s offers.e. Holding: D’s motion of summary judgment shall be denied.f. Points for discussion:1) The definition of handicap includes a person who does not suffer from impairment, but who is perceived as having such impairment. This is because the person is really discriminated even though he does not suffer from impairment. What we really focus is landlord’s intent.2) The prohibition on discriminatory advertising applies to all types of real property.(no exemption)3) “You have too many children for an apartment that small.” This language is not direct evidence of discrimination (familiar status). It may just because the house is too small. So we need more facts about the situation, like the usual number of people living in that apartment.4) Bedroom is not dwelling.5) State statutes may pr。