Meyer v. Holley, 537 U.S. 280 (2003)

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MEYER v. HOLLEY et al.

certiorari to the united states court of appeals for the ninth circuit

No. 01-1120. Argued December 3, 2002—Decided January 22, 2003

The Fair Housing Act forbids racial discrimination in respect to the sale or rental of a dwelling. 42 U. S. C. 3604(b), 3605(a). Respondent Holleys, an interracial couple, tried to buy a house listed for sale by Triad, a real estate corporation. A Triad salesman is alleged to have prevented the Holleys from buying the house for racially discriminatory reasons. After filing suit in federal court against the salesman and Triad, the Holleys filed a separate suit against petitioner Meyer, Triad's president, sole shareholder, and licensed "officer/ broker," claiming that he was vicariously liable in one or more of these capacities for the sales-man's unlawful actions. The District Court consolidated the lawsuits and dismissed the claims against Meyer because (1) it considered them vicarious liability assertions, and (2) it believed that the Fair Housing Act did not impose personal vicarious liability upon a corporate officer or a "designated officer/ broker." In reversing, the Ninth Circuit in effect held that the Act imposes strict liability principles beyond those traditionally associated with agent/principal or employee/employer relationships.

Held: The Act imposes liability without fault upon the employer in accordance with traditional agency principles, i. e., it normally imposes vicarious liability upon the corporation but not upon its officers or owners. Pp. 285-292.

(a) Although the Act says nothing about vicarious liability, it is nonetheless well established that it provides for such liability. The Court has assumed that, when Congress creates a tort action, it legislates against a legal background of ordinary tort-related vicarious liability rules and consequently intends its legislation to incorporate those rules. Traditional vicarious liability rules ordinarily make principals or employers vicariously liable for the acts of their agents or employees in the scope of their authority or employment. E. g., Burlington Industries, Inc. v. Ellerth, 524 U. S. 742, 756. Absent special circumstances, it is the corporation, not its owner or officer, who is the principal or employer subject to vicarious liability for the torts of its employees or agents. The Ninth Circuit's holding that the Act made corporate owners and officers liable for an employee's unlawful acts simply because they controlled (or had the right to control) that employee's actions is

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