Month: August 2010

HOAs vs. local government — which “laws” control?

In the  Aug. 6, 2010 Carpenter Hazlewood (CAI attorneys, AZ) e-newsletter post, “Deed Restrictions versus City and County Ordinances: Which One Controls,”   attorney Nkita Patel wrote,

“In sum, if there is a conflict between the association’s CC&Rs and a city or county ordinance, the more restrictive provision will govern.”  

The underlying rationale is that the homeowner, upon taking possession of his deed, has agreed to every surrender of his rights.  And people can agree to the surrender of their rights.  But, under what circimstances and conditions?  Under servitude law of covenants, the homeowner need not read nor sign his explict consent to the surrender of his rights. But, this justification, by itself, is a violation of not only contract law, but of constitutional law and the owner’s due process rights.  Even The Restatement of Servitudes, §3.1, holds that an unconstitutional covenant is invalid.  What say you, Ms. Patel?  

Furthermore, what say you if the covenant simply says, ineffect, “No parking on the streets or driveway?”   Here, regarding public streets, the ordinance says, “No parking 8:00PM to 6:00AM.”  Which is more restrictive?  Which “political law” controls?   

And, finally, the “usual advice” statements are offered, where only partial answers are provided —  those favoring the HOA and NOT explaining how the law would apply as to circumstances favorable to the homeowner.  Carpenter Hazlewood has never addresed the issue of guest parking and the wrongful holding a member in violation of the CC&Rs in an egregious violation of the law, good faith treatment of members, and a just and fair governance. 

What say you, Ms. Patel, about the HOA’s actions in these circumstances?  Please see Wigwam Creek North HOA v. Fuchs, CC: 2010- 49644, Estrella Justice Court, where such an event and wrongful HOA act took place, apparently with HOA attorney approval.

 

Read more . . .

HOA attorney collusion and regulation of public streets

Ethical obligations of attorneys to HOA members

 

HOA resident applicant questionnaire

I received an email the other day asking for my expert opinion on a proposed application questionnaire for HOA renters.  I replied by asking if the questionnaire would apply to buyers, also, to which the emailer responded, Yes.  Here are the areas of concern as to what should be asked of applicants:

1) Requiring a stated income level (i.e., $30,000, $50,000, $70,000 and so on):

2) Requiring last two year’s tax returns:

3) Please comment on credit score section (Page 1, #3):

4) Please comment on 30-day completion time:

5) Please comment on personal interview by board of directors:

6) Please comment on statement concerning “board’s decision will be final and no reason will be given (i.e., denial).” This statement is immediately above signature line on Page 4:

I responded with:

Adopting such an approach would befit an exclusive community — for those few good men, and women.  It would probably reduce the desirability for the general public, but may attract the few.  It would also hurt sales by existing owners. I believe the promoters of planned communities going back to the gitgo knew that HOAs were not for everybody, but they were interested in the  mass merchandising of HOAs to everyone.

Financial status was already checked by the mortgage insurers, so it buys the HOA very little in any greater protection.   Maybe in regard to getting some assets from the unethical, in my onion, foreclosure auctions. 

However, it will allow a people to people discussion to get a better “feel” for one another.  But, then again, only half the story would be told, since there does exist this unspoken alliance of “No Negatives About HOAs.”  For example, would the board be willing to say to prospective members, “You understand that your home will be collateral for the survival of the HOA?”

It would be interesting to know how this approach plays out.