SB 394 - Changes to Enforcement of Law Against Discriminatory Covenants

Feldsott & Lee
A Law Corporation

Prior law, in the Fair Employment and Housing Act, specified a procedure for homeowners with discriminatory covenants recorded in their title to follow to remove these discriminatory covenants. Previously, a homeowner would file an application with the California Department of Fair Employment and Housing (“DFEH”), requesting a determination that the covenant violates Fair Housing laws and is thus void. If the DFEH determined that the covenant constitutes discrimination and is thus void, the homeowner could modify the title document by striking out the void language, and have that modification recorded by the County Recorder.

AB 394 changes this procedure by eliminating the involvement of the DFEH. Instead, a homeowner who believes that a covenant in his or her title is discriminatory may file a “Restrictive Covenant Modification” with the County Recorder, including a copy of the original title document with the discriminatory language stricken. The County Recorder would then submit the modification documents to the County Counsel, who would make the determination whether or not the restriction is indeed discriminatory. In that case, the County Recorder would record the changed document, and may waive the fees required to do so.

This law does not change the law regarding what is or is not discrimination, nor does it remove the requirement of a cover sheet advising that any discriminatory covenants in a declaration of covenants, conditions and restrictions are void. The only change this law makes is a shift of who determines that a restriction is discriminatory from the DFEH to the County Counsel of the county where the property is located. #