Hogar Agua Y Vida en El Desierto, Inc. v. Suarez-Medina

UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT

No. 93-2017

HOGAR AGUA Y VIDA EN EL DESIERTO, INC., ET AL.,

Plaintiffs, Appellants,

v.

JORGE SUAREZ-MEDINA, ETC., ET AL.,

Defendants, Appellees.

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF PUERTO RICO

[Hon. Juan M. Perez-Gimenez, U.S. District Judge]

Before

Cyr and Stahl, Circuit Judges,

and Pieras,* District Judge.

Nora Vargas Acosta, with whom Sabana Litigation & Civil Rights

Project, Ruth E. Harlow, William B. Rubenstein and American Civil

Liberties Union Foundation were on brief for appellants.

David W. Roman, with whom Ramon A. Alfaro was on brief for

appellee Suarez.
Peter J. Porrata for appellee Dolittle.

September 28, 1994

*Of the District of Puerto Rico, sitting by designation.

CYR, Circuit Judge. Hogar Agua y Vida en el Desierto,
CYR, Circuit Judge.

Inc. ("HAVED"), a nonprofit organization which operates group

homes for persons infected with the Human Immunodeficiency Virus

("HIV"), brought a civil action in the United States District

Court for the District of Puerto Rico alleging discriminatory

conduct by defendants-appellees in violation of the Fair Housing

Act, 42 U.S.C. 3601-3617 (1993) ("FHA"). The district court

ruled that the principal defendants, Jorge Suarez Medina and

Baudilla Albelo Suarez (hereinafter: "Suarez" or "Suarezes"),

were exempt from liability under the FHA by virtue of the "pri-

vate individual owner" provision which applies to persons who own

less than four "single-family houses," see id. 3603(b)(1). For

the reasons discussed in this opinion, we vacate the district

court judgment and remand for further proceedings.

I

BACKGROUND

In September 1992, appellant HAVED entered into an oral

agreement with Suarez to rent, with option to buy, two houses

located on an undivided lot in the Los Llanos section of Corozal,

Puerto Rico. Upon learning that HAVED intended to use the site

as a group home for persons infected with HIV, defendants Milton

Dolittle and Antonio Padilla organized neighborhood opposition

and threatened and coerced Suarez into reneging on the rental-

sale agreement. HAVED, along with its directors and a prospec-

tive resident of the proposed group home, initiated the present

action charging defendants Suarez, Dolittle and Padilla with

violations of FHA 3604 and 3617, and Suarez with breach of

contract under P.R. Laws Ann. tit. 31, 3371-3589 (1993).1

HAVED demanded declaratory and injunctive relief as well as

compensatory and punitive damages.

Suarez moved to dismiss the complaint for lack of

subject matter jurisdiction, citing FHA 3603(b)(1):

(b) Nothing in . . . [section 3604 of this title]
(other than subsection (c)) shall apply to

1Section 3604 of the FHA provides, in pertinent part:

[E]xcept as exempted by sections [3603(b) and 3607], it
shall be unlawful ---

(a) To refuse to sell or rent after making a bona

fide offer, or to refuse to negotiate for the

sale or rental of, or otherwise make un-

available or deny, a dwelling to any person

because of race, color, religion, sex, famil-
ial status, or national origin.

42 U.S.C. 3604(a) (emphasis added). The FHA amendments enacted
in 1988 extended comparable protection to persons with a "handi-
cap," see, e.g., id. 3604(f), including persons infected with

HIV. See Stewart B. McKinney Found., Inc. v. Town Plan and

Zoning Comm'n, 790 F. Supp. 1197, 1209-10 (D. Conn. 1992) (citing

H.R. Rep. No. 100-711, 100th Cong., 2d Sess. 13, reprinted in

1988 U.S.C.C.A.N. 2173, 2179). Section 3617 makes it unlawful to

coerce, intimidate, threaten, or interfere with any
person in the exercise or enjoyment of, or on account
of his having exercised or enjoyed, or on account of
his having aided or encouraged any other person in the
exercise or enjoyment of, any right granted or protect-
ed by [section 3603, 3604, 3605, or 3606].

42 U.S.C. 3617.

3

(1) any single-family house sold or rented by an

owner:

[1] Provided, That such private individual owner

does not own more than three such single-family

houses at any one time:

[2] Provided further, That in the case of the sale

of any such single-family house by a private indi-
vidual owner not residing in such house at the

time of such sale or who was not the most recent

resident of such house prior to such sale, the

exemption granted by this subsection shall apply
only with respect to one such sale within any
twenty-four month period:

[3] Provided further, That such bona fide private

individual owner does not own any interest in, nor

is there owned or reserved on his behalf, under

any express or voluntary agreement, title to or

any right to all or a portion of the proceeds from

the sale or rental of, more than three such sin-
gle-family houses at any one time:

[4] Provided further, That after December 31,

1969, the sale or rental of any such single-family
house shall be excepted from the application of
this title only if such house is sold or rented

(A) without the use in any manner of the
sales or rental facilities or the sales or
rental services of any real estate broker,
agent, or salesman, or of such facilities or
services of any person in the business of
selling or renting dwellings . . . and

(B) without the publication, posting or mail-
ing, after notice, of any advertisement or
written notice in violation of [section 3604-
(c) of this title] . . . .

42 U.S.C. 3603(b)(1) (emphasis added; clause numbers added;

indentation altered from original).

4

A. The Suarez Properties

At the time of the September 1992 rental-sale agreement

with HAVED, Suarez owned four separate parcels of land on which

were located five structures. First, the "Los Llanos Property,"

the subject of the abortive rental-sale agreement, consists of

one undivided lot containing two unattached residences. Suarez

holds undisputed title to the entire lot and one residence (House

A) where the Suarezes once resided. Their son built the second

house on the lot (House B) as a residence for his own family.

However, Mr. Suarez, Sr., was robbed while residing in House A,

and the Suarezes and their son moved away from Los Llanos.

Houses A and B remained unoccupied at the time of the HAVED-

Suarez rental-sale agreement.

Second, the "Guarico Residence," located in the Guarico

section of Corozal, was designed as a two-story house with a

separately equipped, single-family apartment on each floor.

Suarez held title to the lot and the house. At the time of the

rental-sale agreement, the Suarezes resided primarily in the

second-floor apartment, and the son and his family resided in the

first-floor apartment. Due to his physical impairments, however,

Mr. Suarez, Sr., sometimes lived "interchangeably" with his son's

family in the first-floor apartment. The district court ruled

that the Guarico Residence constituted one single-family house.

Third, the "Guarico Rental" is a two-story, single-

family structure located near the Guarico Residence but on a

5

separate lot. At the time of the rental-sale agreement, Suarez

held title to the house and the lot, and the house was being

rented to a single family.

The fourth real estate parcel, the "La Aldea Rental,"

is a single lot in the La Aldea section containing a one-story

structure which Suarez purchased in April 1991, and rented to a

single family (Apartment 1). Prior to the rental-sale agreement,

however, Suarez renovated the basement of the building into a

separate apartment (Apartment 2), and it was rented to another

tenant.

B. The District Court Proceedings

Following an evidentiary hearing, the district court

dismissed the HAVED complaint for lack of "subject matter juris-

diction," citing Fed. R. Civ. P. 12(b)(1) and (6). Pursuant to

Provisos 1 and 3 of FHA 3603(b)(1), the court ruled that at the

time of the rental-sale agreement with HAVED in September 1992,

Suarez had a bona fide ownership interest in only three "single-

family houses" (hereinafter: "SFH" or "SFHs"): (i) the Guarico

Rental, (ii) the La Aldea Rental (Apartment 1), and (iii) the La

Aldea Rental (Apartment 2).2

2The district court also found, under Proviso 4 and 42
U.S.C. 3603(c), that Suarez did not qualify as a "person in the
business of selling or renting dwellings," id., because he had

not participated in more than two real estate transactions
between September 1991 and September 1992. Because Suarez must
satisfy all four provisos in order to qualify for the 3603(b)-
(1) exemption, we need not reach this issue.

6

Thus, the district court explicitly declined to treat

three abodes as SFHs. First, the court ruled that the Guarico

Residence is not a SFH under FHA 3603(b)(1) because only SFHs

that are "sold or rented" can be counted toward the four-SFH

threshold. In other words, in the district court's view a defen-

dant's current residence is not counted as an SFH under Provisos

1 and 3 unless it is the subject of the sale or rental transac-

tion giving rise to the cause of action under the FHA, or it is

"on the market" at the time of the challenged transaction. See

Hogar Agua y Vida en el Desierto, Inc. v. Suarez, 829 F. Supp.

19, 22 (D.P.R. 1993) (citing Lamb v. Sallee, 417 F. Supp. 282,

285 (E.D. Ky. 1976)). Second, since Suarez, Sr., had been forced

to vacate House A at the Los Llanos Property after the robbery,

and to acquire the Guarico Residence, the district court conclud-

ed that it would be "inequitable" to treat House A as a SFH under

either Proviso 1 or 3. Id. at 22-23. Finally, relying on the

same equitable grounds noted in relation to House A, the district

court ruled that House B on the Los Llanos Property should not be

treated as a SFH. The court ruled, in the alternative, that

House B should not be treated as a SFH because the Suarezes's

son, who constructed House B, was its bona fide owner under

Puerto Rico law; whereas the Suarezes simply held an unexercised

"right of accession" based on their ownership of the land on

which House B is situated. Id. at 23 (citing Castro Anguita v.

7

Figueroa, 103 P.R. Dec. 847, 850-51, 3 Official Translations

1188-89 (1975)).3

II

DISCUSSION

Since the only dispute on appeal concerns the legal

sufficiency of undisputed jurisdictional facts, we review the

Rule 12(b)(1) dismissal de novo. See Heno v. FDIC, 20 F.3d 1204,

1205 (1st Cir. 1994). We conclude, as a matter of law, that the

Suarezes's claim to exemption is precluded by the FHA. See FDIC

v. Keating, 12 F.3d 314, 316 (1st Cir. 1993) (statutory interpre-

tations reviewed de novo).

We employ traditional tools of statutory interpreta-

tion, particularly the presumption that ambiguous language in a

remedial statute is entitled to a generous construction consis-

tent with its reformative mission. See, e.g., Cia. Petrolera

Caribe, Inc. v. ARCO Caribbean, Inc., 754 F.2d 404, 428-29 (1st

Cir. 1985) (noting that this canon of construction represents an

"especially reliable and legitimate" indicator of congressional

intent); see generally 3 Norman J. Singer, Sutherland on Statuto-

ry Construction 60.01 (5th ed. 1992) [hereinafter Sutherland].

3The district court implicitly concluded as well that
HAVED's claims against codefendants Dolittle and Padilla under
FHA 3617 should be dismissed because the Suarezes are exempt
from liability under FHA 3604. See supra note 1. Although

this ruling is contested by HAVED, we need not reach it.

8

This presumption has been relied on consistently by the courts in

interpreting the omnibus remedial provisions of the Civil Rights

Act of 1968, which prominently include the Fair Housing Act

itself. See Casa Marie, Inc. v. Superior Court of Puerto Rico,

988 F.2d 252, 257 n.6 (1st Cir. 1993) (citing Trafficante v.

Metropolitan Life Ins. Co., 409 U.S. 205, 211-12 (1972)); see

also City of Edmonds v. Washington State Bldg. Code Council, 18

F.3d 802, 804 (9th Cir. 1994). An important corollary for

present purposes is that ambiguous exemptions from FHA liability

are to be narrowly construed. See, e.g., id.; Elliott v. City of

Athens, Georgia, 960 F.2d 975, 978-79 (11th Cir.) cert. denied,

113 S. Ct. 376 (1992); United States v. Columbus Country Club,

915 F.2d 877, 882-83 (3d Cir. 1990) (collecting cases), cert.

denied, 501 U.S. 1205 (1991).

From this appellate perspective we consider which

Suarez properties were "single-family houses" within the meaning

of Provisos 1 and 3 of FHA 3603(b)(1). The parties agree that

two properties the Guarico Rental and the La Aldea Rental

qualify as "single-family houses" within the meaning of the

exemption.4 Thus, given the four-SFH limen established in

4Absent appellate briefing, we hazard no view on the cor-
rectness of their stipulation. The burden of proving entitlement
to an FHA exemption rested with Suarez. See Massaro v. Mainlands

Section 1 & 2 Civic Ass'n, 3 F.3d 1472, 1475 (11th Cir. 1993)

(FHA); Columbus Country Club, 915 F.2d at 882 (FHA); Singleton v.

Gendason, 545 F.2d 1224, 1226 (9th Cir. 1976) (FHA); see also 2A

Sutherland 47.11, at 165 (general rule of construction).

Whatever its legal elements, entitlement to an FHA exemption

9

section 3603(b)(1), the FHA exemption cannot stand if the Suar-

ezes were bona fide "owners" of two SFHs in addition to the

Guarico Rental and the La Aldea Rental.

A. Los Llanos Property, House A

First, HAVED argues that the district court exceeded

its authority by fashioning an "equitable" exception which

resulted in the exclusion of Los Llanos, House A, from the four-

SFH calculus on the ground that the Suarezes had been forced to

vacate the Los Llanos area due to neighborhood crime. See In re

Shoreline Concrete Co., 831 F.2d 903, 905 (9th Cir. 1987)

("Courts of equity are bound to follow express statutory commands

to the same extent as are courts of law.") (citing Hedges v.

Dixon County, 150 U.S. 182, 192 (1893)).

Although courts have on occasion engrafted equitable

exceptions where rigid adherence to literal legislative language

clearly would disserve legislative intent, see, e.g., Zipes v.

Trans World Airlines, 455 U.S. 385, 398 (1982) (equitable tolling

of filing deadlines), generally courts are loath "to announce

turns on highly fact-dependent inquiries (e.g., the structural

design or usage of each dwelling), such that Suarez is bound to
these stipulations for purposes of the present litigation. Cf.

Railway Co. v. Ramsey, 89 U.S. (22 Wall.) 322, 327 (1874) ("Con-

sent of parties cannot give the courts of the United States
[subject matter] jurisdiction, but the parties may admit the
existence of facts which show jurisdiction, and the courts may
act judicially upon such an admission."). By the same token, no
precedential significance should be ascribed to our acceptance of
these stipulations.

10

equitable exceptions to legislative requirements or prohibitions

that are unqualified by the statutory text." Guidry v. Sheet

Metal Workers Nat'l Pension Fund, 493 U.S. 365, 376 (1990)

(emphasis added). Moreover, "[w]here Congress explicitly enumer-

ates certain exceptions to a general prohibition, additional

exceptions are not to be implied, in the absence of contrary

legislative intent." Andrus v. Glover Constr. Co., 446 U.S.

608, 616-17 (1980) (emphasis added). Further, exemptions from

the requirements of a remedial statute like the FHA are to

be construed narrowly to limit exemption eligibility. See

Badaracco v. Commissioner, 464 U.S. 386, 398 (1984) (rejecting

taxpayer plea for "nonliteral reading" of tax statute "on grounds

of equity to the repentant taxpayer," and noting that, faced with

a statute "which must receive a strict construction," "[c]ourts

are not authorized to rewrite [the] statute because they might

deem its effects susceptible of improvement."); supra pp. 8-9.

For the foregoing reasons, we decline to endorse the

equitable exception adopted by the district court, especially

since Congress elected not to do so when it undertook to narrow

FHA liability in 42 U.S.C. 3603(b). Nothing in section 3603-

(b), nor in its legislative history, manifests a congressional

intent to temper either the inflexible four-SFH formula or the

categorical "ownership" standard. Thus, we believe these FHA

provisions reflect the sort of "considered congressional policy

choice" that elevates the "effectuation of certain broad social

11

policies . . . over the desire to do equity between particular

parties." Guidry, 493 U.S. at 376. Guidry cautions against

creating equitable exceptions to comprehensive remedial statutes

in an effort to protect individual defendants from occasional

inequities, even inequities attributable to misfeasance by the

plaintiffs. Id. (holding that the district court had no equita-

ble power to contravene ERISA's unqualified anti-garnishment

provision by imposing a constructive trust upon pension benefits

payable to a former union official who embezzled union funds).

The Guidry admonition holds even stronger sway where, as here,

defendant-Suarez's misfortunes were in no sense due to HAVED's

conduct. The Court recognized in Guidry that any attempt to

calibrate the precise point at which an individual defendant's

vicissitudes are so "'especially' inequitable" as to outweigh the

broad prophylactic policies underlying the congressional decision

to protect the plaintiff class would immerse the courts in an

inappropriate and "impracticab[le]" task. Id. (emphasis add-

ed).5

5The cases Suarez cites in support of the equitable excep-
tion fashioned by the district court, see, e.g., FTC v. Security

Rare Coin & Bullion Corp., 931 F.2d 1312, 1314 (8th Cir. 1991),

concerned the equitable remedies a district court may impose
after a defendant has been found in violation of a statutory

prohibition. For example, if the statute empowers the court to
restrain violations, and neither expressly nor "by a necessary
and inescapable inference [] restricts the court's jurisdiction
in equity," Porter v. Warner Holding Co., 328 U.S. 395, 398

(1946), the court could utilize all its traditional equitable
powers or even desist from extending any equitable relief to the
plaintiff where the equities warrant. See Williams v. Jones, 11

12

B. The Guarico Residence

HAVED next contends that the district court committed

reversible error in not treating the Guarico Residence as a SFH

under Provisos 1 and 3 of FHA 3603(b)(1). HAVED argues that

nothing in FHA 3603(b)(1) excludes "owner-occupied" houses from

the term "single-family house." Furthermore, HAVED notes,

Proviso 2 explicitly qualifies the term SFH ("any such single-

family house by a private individual owner not residing in such

house at the time of such sale"), a qualification that would be

entirely unnecessary if the term "SFH" itself excluded owner-

occupied houses.

On the other hand, Suarez says that the Guarico Resi-

dence is excluded from consideration under Provisos 1 and 3

because the prefatory clause in FHA 3603(b)(1) (exempting "any

single-family house sold or rented by the [defendant]" in a

discriminatory manner) suggests that Congress did not intend that

any property of the defendant count toward the four-SFH threshold

unless that property itself was up for sale or rent at the time

F.3d 247, 256 (1st Cir. 1993). Nonetheless, the latter rubric
provides no basis for extending an FHA exemption by withholding

from HAVED all relief against Suarez's alleged discriminatory

refusal to sell or rent the Los Llanos Property. Moreover, even
if the court were permitted to withhold injunctive relief, Suarez
would be answerable for legal damages (actual and punitive) for

any FHA violation. See 42 U.S.C. 3613(c). More importantly,

however, Suarez could have asserted no cognizable equitable
defense in light of the fact that his misfortunes while residing

in Los Llanos were in no sense attributable to HAVED.

13

of the allegedly discriminatory transaction.6 Suarez argues

that this must be so because the references to "such [SFHs]" in

Provisos 1 and 3 can only relate back to the prefatory clause,

and incorporate the requirement that only "sold or rented" SFHs

are to be included in calculating the four-SFH threshold. Thus,

Suarez says, a defendant's residence normally would not be

included as a SFH unless it were on the market at the time of the

alleged discriminatory sale or rental. Suarez discounts the

value of Proviso 2 as a tool for interpreting the prefatory

clause in FHA 3603(b)(1), since Proviso 2 creates a

considerably "narrower" and altogether independent exemption that

allows one discriminatory sale (but not a rental) of an owner-

occupied SFH to be excluded within any two-year period. Proviso

1, on the other hand, creates a "broader exemption" for owners

who own no more than three SFHs that are either for sale or rent

by the owner.7

6As with his other concessions, see supra note 4, Suarez

stipulates that the Guarico Residence would qualify as a "single-
family house" in all respects, but for its status as his current,

off-market residence. We take no position respecting the basis
for Suarez's stipulation, but confine our consideration to the
two issues briefed by the parties.

7Alternatively, Suarez argues that the Guarico Residence is
excluded under the so-called "Mrs. Murphy" exemption in FHA
3603(b)(2), which exempts "rooms or units in dwellings contain-
ing living quarters occupied or intended to be occupied by no
more than four families living independently of each other, if

the owner actually maintains and occupies one of such living

quarters as his residence." 42 U.S.C. 3603(b)(2) (emphasis

added). The "Mrs. Murphy" exemption is totally inapposite,
however. It provides an exemption from section 3604 liability.

14

The present dispute prompts two inquiries. The first

is whether a defendant's current residence is excluded from the

threshold four-SFH calculus under Provisos 1 and 3 simply because

it is his primary or current residence, even though all other

SFHs owned but not occupied by the defendant are included without

regard to whether they were concurrently "on the market." The

second inquiry is whether Congress meant to exclude from the

threshold four-SFH calculus all SFHs owned by the defendant

(including the primary residence) not on the market at the time

the defendant for discriminatory reasons refused to sell or

rent a different SFH to the plaintiff. We turn to these ques-

tions.

1. Exclusion for Residence Qua Residence

As its prefatory clause makes clear, the FHA 3603-

(b)(1) exemption assuming its four provisos are satisfied

applies to any "single-family house sold or rented by the owner"

in a discriminatory manner. For section 3603(b)(1) purposes,

therefore, the relevant SFHs in this case are Houses A and B,

located on the Los Llanos Property Suarez refused to rent or sell

to HAVED. Section 3603(b)(1) neither defines the term "SFH," nor

It does not exclude a structure from the Proviso 1 and 3 analyses

under FHA 3603(b)(1). See id. 3604(b) ("nothing in section

[3604] . . . shall apply to . . . rooms and units . . . .").
Thus, the "Mrs. Murphy" exemption could have relevance only if,
for example, Suarez had refused to sell or rent one unit in the

Guarico Residence to HAVED.

15

does its prefatory clause expressly limit the term "SFH" to

structures in which the defendant does not reside. Conversely,

as Suarez acknowledges, if the Suarezes had refused to rent or

sell their Guarico Residence to HAVED, the prefatory clause would

not have debarred the Suarezes from a section 3603(b)(1) exemp-

tion merely because the property being rented or sold was their

residence.

The statutory context in which the prefatory clause

appears undermines the Suarez contention as well. See Skidgel v.

Maine Dep't of Human Servs., 994 F.2d 930, 937 (1st Cir. 1993)

(meaning of particular statutory language assessed in light of

entire statute). The four FHA 3603(b)(1) provisos do not give

rise to four independent exemptions, as Suarez suggests, but

represent four cumulative preconditions to the single exemption

set out in the prefatory clause. If any of the four provisos is

not satisfied, no section 3603(b)(1) exemption is appropriate.

Proviso 2 refers specifically to a discrete subset of

the "discriminatory" SFH sales focused upon in the section

3603(b)(1) prefatory clause, namely, sales of SFHs in which the

defendant is not residing. If the unqualified term "SFH" in the

prefatory clause were intended to embrace only SFHs in which the

defendant is not residing, no such further qualification would be

needed in Proviso 2. See Mosquera-Perez v. INS, 3 F.3d 553, 556

(1st Cir. 1993) (court should avoid interpretations which render

any part of statute meaningless). Thus, if the term "SFH," as

16

used in the prefatory clause, applies to residences and non-

residences, the pendent references to "such [SFHs]" in Provisos 1

and 3 also necessarily encompass the Suarezes's Guarico Residence

qua residence.

Finally, the legislative history discloses no basis for

second-guessing the "plain language" of section 3603(b)(1). See

Laracuente v. Chase Manhattan Bank, 891 F.2d 17, 23 (1st Cir.

1989) ("Absent a clearly expressed legislative intention to the

contrary, the plain language of the statute is conclusive."). As

initially introduced in Congress, the FHA contained few signifi-

cant exemptions from liability, see, e.g., supra note 7 (describ-

ing "Mrs. Murphy" exemption), and the breadth of the FHA's

coverage caused vigorous Senate opposition. See generally Jean

E. Dubofsky, Fair Housing: A Legislative History and a Perspec-

tive, 8 Washburn L.J. 149 (1969). Senator Everett M. Dirksen

proposed to assuage opposition by exempting sales and rentals of

"any single-family house sold or rented by an owner residing in

such house at the time of such sale or rental, or who was the

most recent resident of such house prior to such sale or rental."

See 114 Cong. Rec. 4571 (1968). Yet even the "Dirksen substi-

tute," later modified and enacted as Proviso 2, failed to gain

enough Senate support. To break the deadlock, Senator Robert C.

Byrd proposed the expanded four-part exemption, later codified as

present section 3603(b)(1). During floor debate, Senator Byrd

offered two illuminating hypotheticals to demonstrate the cover-

17

age which would be provided under his proposal, but not under the

Dirksen substitute:

A widow owns and lives in a single-family

dwelling. She also owns a single-family
dwelling across the street, the tenant there-
in being her daughter. The daughter moves to
another State. The widow cannot qualify for
exemption under the Dirksen substitute be-
cause she neither resides in the house across
the street of which she is the owner
nor is the "most recent resident" of such
dwelling prior to a subsequent sale or rent-
al.

An individual lives in his own single-family

dwelling located on a three-quarter-acre lot.
He decides to build a second house on the
lot. Ten years later misfortune forces him
to parcel the lot and sell the house thereon.

He does not qualify under the Dirksen substi-
tute exemption because he is neither "resid-
ing in" the adjacent dwelling nor was he the
"most recent resident" thereof.

114 Cong. Rec. 5640 (1968) (emphasis added).

Asked why "it was necessary to raise the number of

houses owned by one party to three," Senator Byrd referred to

these two hypotheticals, and noted that he had "already discussed

situations in which there would be at least two [single-family]

houses involved." Id. (emphasis added). Significantly, both

hypotheticals assumed that the houses in which the seller cur-

rently resided would be counted toward the four-SFH threshold in

Provisos 1 and 3. See Rice v. Rehner, 463 U.S. 713, 728 (1983)

(noting that interpretation of statute by sponsor is "'authori-

tative guide to the statute's construction'") (citation omitted);

see also Brock v. Pierce County, 476 U.S. 253, 263 (1986)

18

(sponsor's statements credited if consistent with statutory

language). Other senators likewise recognized that the "more

than three" threshold would include houses in which the seller

resided. See 114 Cong. Rec. 5641 (1968) ("I know we have people

who have a summer home or a winter home. . . . One could easily

have three homes.") (statement of Senator Jordan). Since this

legislative history, at the very least, precludes our finding "a

clearly expressed legislative intention to the contrary,"

Laracuente, 891 F.2d at 23, we must conclude that a defendant's

residence, qua residence, is not to be excluded under Provisos 1

and 3 of section 3603(b)(1).8

2. Exemption for "Off Market" SFHs

8The legislative history contains a reference arguably
supportive of the Suarez interpretation of Provisos 1 and 3.
Senator Byrd suggested that he chose "three" as the threshold
figure under Provisos 1 and 3 to match the "Mrs. Murphy exemp-
tion," see supra note 7, which provides an exemption to a resi-

dent landlord of multi-family quarters (containing not more than
four family quarters) who refuses to rent any family quarters in
the building. Senator Byrd noted that "Mrs. Murphy" must live in
one of the four family quarters, so as to confine the "protective
reach" of the "Mrs. Murphy" exemption "to three units other than

the one in which she lives. In my amendment, therefore, I use

'three' as the number, in order to have parallel construction."
114 Cong. Rec. 5640.
We note two sound reasons for devaluing this statement.
First, as noted, see supra p. 19, inconsistent expressions of

sponsor intent are insufficient to override the plain import of
the statutory language. Second, Senator Byrd's more generalized
statements concerning a rough numerical symmetry in statutory
construction were preceded by his detailed recitation of the two

fact-specific hypotheticals discussed above. See supra p. 18.

19

Suarez proposes to exclude the Guarico Residence under

Provisos 1 and 3 because it was neither for rent nor sale at the

time he refused to sell the Los Llanos Property to HAVED. See

Lamb v. Sallee, 417 F. Supp. 282, 285 (E.D. Ky. 1976). The

theory is that the term "such [SFHs]" in Provisos 1 and 3 unam-

biguously relates back to the complete phrase "single-family

house sold or rented by an owner" in the section 3603(b)(1)

prefatory clause. The language of the statute is not dispositive

on this issue, and the interpretation proposed by Suarez is at

least plausible.

Although it is conceivable that Congress's choice of

the indeterminate modifier "such" was intended only to require

the counting of residences qua residences under Provisos 1 and 3

in direct contrast to the more constricted scope of the term

"SFH" under Proviso 2 Provisos 1 and 3 reasonably might be

read to impose the additional, distinct requirement that any SFH,

regardless whether it is the defendant's "residence," be counted

under Provisos 1 and 3 only if it is a "single-family house sold

or rented by an owner." Indeed, Congress's choice of words

"sold or rented" in the section 3603(b)(1) prefatory clause is

a most curious usage. In order for liability to attach under FHA

3604, a defendant need never have consummated the discriminato-

ry rental or sale of the SFH to which the section 3603(b)(1)

prefatory clause adverts. Rather, FHA liability attaches as soon

as the defendant "refuses to sell or rent after [the plaintiff

20

makes] a bona fide offer," see supra note 1, without regard to

whether the SFH is ever "sold" or "rented" to anyone. With these

linguistic difficulties in mind, it seems arguable at least, in

keeping with the structure and language of the statute, that the

term "such," as used in Provisos 1 and 3, imports the same "on

the market" qualification necessarily implicit in the section

3603(b)(1) prefatory clause.

As noted earlier, however, normally latent ambiguity in

a statutory modifier like "such" should be construed in further-

ance of the statute's remedial goals. See Cia. Petrolera, 754

F.2d at 428. ("When Congress uses broad generalized language in

a remedial statute, and that language is not contravened by

authoritative legislative history, a court should interpret the

provision generously so as to effectuate the important congres-

sional goals.") Not only does the authoritative legislative

history not contravene the HAVED interpretation, see supra

Section II.B.1, it contradicts the Suarez contention. Most

importantly, neither hypothetical advanced by Senator Byrd

assumed or intimated that the seller's residence was "on the

market" at the time the discriminatory sale of the second house

took place, yet Senator Byrd included both these SFHs under

Provisos 1 and 3. Notwithstanding a conceivable vestige of

literal ambiguity, therefore, we are persuaded to the view that

the Guarico Residence must be included in the four-SFH calculus

21

under section 3603(b)(1) consistent with the FHA's legislative

history and its broad remedial design.9

9The only case to address this precise issue, see Lamb v.

Sallee, 417 F. Supp. 282 (E.D. Ky. 1976), reached the opposite

conclusion, without reference to the legislative history and
without analysis. Id. at 285 ("The Court has found no authority

construing [section 3603(b)(1)] and counsel for the respective
parties have cited none.").

22

III

CONCLUSION

At the time HAVED was denied the opportunity to acquire

the Los Llanos Property, allegedly on discriminatory grounds,

Suarez held an undisputed ownership interest in "more than three"

"single-family houses": the Guarico Rental, the La Aldea Rental,

the Los Llanos Property, House A, and the Guarico Residence.

Since Suarez cannot satisfy either Proviso 1 or Proviso 3, the

alleged discriminatory refusal to proceed with the HAVED rental-

sale agreement relating to the Los Llanos Property did not

qualify for exemption under FHA 3603(b)(1).

The district court judgment is vacated. The case is

remanded for further proceedings consistent with this opinion.

Costs to appellant.

23