Question: The owners of the condominiums in the community
want to amend the CC&Rs to prohibit ownership of a condominium
by registered sex offenders (“RSOs”). Can CC&Rs prohibit ownership
of a condominium by RSOs?
Answer: Probably. First, RSOs are not a “protected class”
under Fair Housing laws. Second, inasmuch as Fair Housing laws
are not involved, homeowners can collectively agree in CC&Rs to
reasonably restrict ownership. For example, CC&Rs can require
approval by the board of directors of a homeowner.
A New Jersey judicial decision upheld an HOA bylaw that prohibited
condominium ownership to Tier 3 RSOs. Mulligan v. Panther Valley
Property Owners Association, 766 A.2d 1186 (N.J. Super. App. Div.
2001). (In New Jersey, as in Arizona, Tier 3 is reserved for RSOs
who are classified as a “high” risk level to the community.) Inasmuch
as there were only eighty Tier 3 RSOs in New Jersey, the New Jersey
Court had no problem upholding the HOA bylaw. The New Jersey Court
stated that, if the HOA bylaw or other restriction included Tier
1 and Tier 2 RSOs, there would be stronger arguments that the
HOA bylaw or other restriction would not be upheld.
