th CarolinaThe question before us is: Can homeowners expect a fair and just opinion when submitting to CAI mediation[1] services? My answer is a resounding NO! CAI has a rock-solid position to defend the HOA by interpreting the governing documents and state laws in favor of the HOA. I come to this view after reading hundreds of CAI involved cases and its amicus curiae briefs[2] – friend of the court filings — across the country.
In Arizona, and elsewhere, CAI has jumped on the bandwagon to provide mediation services because of OAH’s promotion of mediation and ADRE’s favorable view. In my view, it’s just another opportunity to intimidate homeowners under the appearance of community services for a better America.
CAI amicus brief shows that it is not a neutral party
To get an idea of how CAI might function as a mediator, I look to its amici briefs for guidance, and, in particular, its brief in the 2016 South Carolina appellate case, Tallahassee Island Members Club.[3] The brief demonstrates how CAI will skirt the fundamental issue for the court to decide and argue peripheral concerns. In short, the case centered on state law and several CC&R covenants that were changed several times over the years.
In this instance, HOA members were allowed to resign membership in an entity that provided amenities, with a statement that dues were owed. One interpretation was forever as long as the homeowner retained lot ownership, versus only past dues are owed up to the time of resignation. The question of resigning was not an issue. (As I see it, it was a flaw in the CC&Rs designed to attract home ownership – you can leave.)
The Court, showing its cosmopolitan view of the world, decided in favor of the homeowner and, in doing so, made the following statement: “In essence, Appellants would be trapped like the proverbial guests in the Eagles’ hit Hotel California, who are told ‘you can check-out anytime you like, but you can never leave.’“[4] In short, the Court held that it is meaningless to allow a member to resign and yet still be obligated as if he were still a member. This was the only valid point, in my opinion, to be argued by CAI: does the resigned owner pay forever?
The CAI brief was a cry for the protection and survival of the HOA and the grave harm to the state of South Carolina if the court ruled against the HOA. The fear mongering ploy. It skirted the wording and reasonable interpretation of the wording, except to argue, once again, “contract interference” when things didn’t go its way. The heart of the matter remained: this is what the CC&Rs said and if it was a mistake or ill thought out, that’s the HOA’s problem. In contrast, recall how many times the homeowner was charged with trying to get out of a bad contract and must be held to the contract.
Excerpts from the CAI amicus curiae brief
Below are excerpts from the brief with its repeated and desperate cries and moaning that the sky would fall.
But first, remembering that this is 2016, look at CAI’s lack of candor to the tribunal (a violation of professional conduct) and its arrogance in making such statements to a state supreme court, when as far back as 2005 it no longer had HOAs as members. CAI also failed to state that it is a business trade organization and not an educational organization for its members.
Its [CAI] members include community associations . . .. CAI regularly expresses its position on issues of potentially national concern, and advocates on behalf of community associations and their residents before legislatures, regulatory bodies and the courts.
Note: With respect to CAI’s arguments, square brackets “[ ]” are my comments to the quote, and underling or bold is my emphasis):
If members could freely abandon their membership . . . community associations would face an obvious crisis [true, but that’s the basis of the HOA legal structure, a defect in the structure] and a great inequity would be created in each such association [not true, based on the joint and several nature of the HOA legal construct
Community associations serve vital purposes for the benefit of property owners in South Carolina [and] other quasi-governmental services. [. . .] The Opinion is contrary to sound public policy because it undermines the ability of community associations to provide quasi-governmental functions to their members. [How interesting. Now another about face to protect the HOA.] This will increase the burden on the State to provide those services. [Yep. But, it’s part of the agreement. Trying to get out of an agreement?].
The Opinion fails to consider the significant negative financial impact that its ruling will have on community associations in this State, as well as their members. [Was that an issue before the court?]
The Opinion undermines previous South Carolina caselaw, which confirms that declarations of covenants and master deeds are contractual in nature, in that it [the opinion] allows parties to those contracts to unilaterally breach them and avoid their promises. [Not so. The CC&Rs provide for unilateral resignation. It’s part of the contract that the HOA must enforce and live up to].
CAI respectfully posits that the Court of Appeals misinterpreted the plain language of the Act [SC statutes] in a way that denies the freedom to form community associations (or many other kinds of nonprofit organizations) whose financial viability depends upon regular, predictable financial contributions from a finite pool of members. [Well, that’s how the ‘game’ was structured.]
[How many nonprofit entities have the right to lien and foreclose on members who fail to pay their agreed upon pledges or dues? How many? But this was part of the deal not publicized to the home buyer: the member is jointly and severally obligated to the HOA for the failure of other members to pay their full freight.]
No nonprofit club or association can survive unless it can enforce members’ voluntary, written contractual pre-resignation commitments. [OMG! That’s another overly broad statement].
Such a voluntary arrangement [CC&Rs] is not a trap. It is the agreement that members freely make when they join certain associations, such as amenity clubs or property owners’ associations. It is the bedrock principle upon which every community association survives. [. . .] Consequently, the financial viability of the community association is dependent upon the members honoring their voluntary, written, contractual financial commitment. [I agree. But here the HOA CC&Rs are defective, but for CAI that doesn’t count. Oh gee judge, we made a mistake let us correct it now].
Conclusion and Advisory
No, this is the kind of advice and mediation counseling of a homeowner can expect using a CAI mediation service. It must not be allowed to happen, nor supported by municipalities and state agencies charged with independent due process and the protection of the general public.
IT IS IMPORTANT that readers understand that this brief is a tacit admission by the CAI attorneys, the experts in HOA law, that the HOA legal structure and concept is defective; that what is necessary to make the defective scheme work is an adhesion contract and an authoritarian government that places the HOA, the state, before the fundamental rights and freedoms of its members, the citizens of this country. The state must not be allowed to fail at any cost, is its guiding principle.
References
[1] “In mediation, the disputing parties work with a neutral third party, the mediator, to resolve their disputes. The mediator facilitates the resolution of the parties’ disputes by supervising the exchange of information and the bargaining process. The mediator helps the parties find common ground and deal with unrealistic expectations. He or she may also offer creative solutions and assist in drafting a final settlement. The role of the mediator is to interpret concerns, relay information between the parties, frame issues, and define the problems.” “What is mediation?”; Findlaw. (Emphasis added).
[2] Amicus curiae: “A person or group who is not a party to an action, but has a strong interest in the matter, will petition the court for permission to submit a brief in the action with the intent of influencing the court‘s decision.” https://www.law.cornell.edu/wex/amicus_curiae.
[3] Tallahassee Island Members Club v. Dennis, 417 S.C. 610 (2016). CAI brief. I read both the brief and court opinion.
[4] Eagles, Hotel California, on Hotel California (Asylum 1977).
HOA Constitutional Government 
Thank you brother George for your undying efforts to teach the homeowner about the illegality of the HOA ‘ adhesion contract’ and other pertinent issues to educate the pubic about an evil regime that is nothing more than an illegal and unconstitutional ” secret combination ” of evil doers who seek gains and power at the expense of the innocent public.
To be sure this “scheme” promulgated by CAI is robbery and deception. I would like to hear more from you about the defective language in the Arizona CC&Rs pretending to allow home buyers who are tricked into signing the ‘ adhesion contract ‘ and surrendering rights guaranteed inalienable to withdraw or resign from HOA membership…and if they do ‘ voluntarily quit the bogus IRC Sec. 501(c)(6) tax exempt criminal syndicate ‘ why must they be liable for membership dues?
If you quit a club or gym membership and no longer use their services…how can anyone, as a matter of contract law be required to pay membership dues when it is obvious the ‘ adhesion contract ‘ is defective and the HOA is unconstitutional?
I realize you have devoted a lifetime of research on this and related matters…why can’t an individual homeowner ‘ withdraw membership ‘ and be done with the HOA-CAI and subsequent fines,
special assessments, HOA-CAI attorney fees, etc. Why will federal and state judges protect the evil empire of the HOA deceptive configuration? Why can’t I check out of Hotel California and leave the HOA in the rear-view mirror?
Keep up the “cracks in the dam ” efforts…as Ghandi said…terrorist and tyrants always fail…it may take time…but they always fall in due time. Most of cognizant homeowners who want out of the HOA trap and to escape captivity of the infamous HOA-Land…support your righteous and necessary efforts to expose the enemy of peace and fair play.
We pray for you and thank you for elucidating insight that helps us live in captivity and injustice of today’s obnoxious quasi-authoritarian private housing governments.
Barry
________________________________
Mediators must have the permission of both parties of the conflict to be presented. The mediation process should be governed by a strict rule that any mediator should be subject to be approved by both parties. This gives protection to the homeowners who will in effect have veto power to any mediator who they think will not be fair. This is common in most mediation situations such as securities disputes.
Very good point!
The question is: does the average homeowner know the real CAI or is he going along with the CAI propaganda? Who is there to correct his view of CAI? Not the government agencies. Not the media. Not the municipalities that sponsor CAI seminars. Who is there to set the record straight for an informed decision?
Again, it’s an issue of disclosure.
CAI is certainly NOT a source to be trusted for fair mediation. If what I experienced with CAI attorneys involved is any indication, the CAI attorneys are NOT on the side of the homeowner. They will spin the truth, they will attack the homeowner unfairly, they will even present false evidence in court or twist the truth. They are NOT to be trusted.
Under NO circumstances should homeowners expect a fair and just opinion if CAI is involved. Btw, the CAI attorneys along with the Board lost the case despite all their manipulations and twisting the truth.
Hire an honest and strong attorney to combat the CAI attorney the HOA will hire. CAI is not to be trusted, they are on the side of the CAI management companies whose goal is to keep the account and make money, the HOA bully Boards that go against the homeowners who stand up for their rights and the CAI money billing attorneys who profit by billing the HOAs for their time.
It will be a waste of time to trust CAI to be fair mediators. Actually it is the most ridiculous suggestion.
Anyone even considering this option has to just review all the legal cases that CAI attorneys have been involved in and they will easily identity the unfair manner in which homeowners are treated. The CAI attorneys are not going to change.
Every homeowner needs to be aware of one fact: CAI attorneys are involved because that is the way they make lots of money. $s is what counts to them. They get paid by the HOA or insurance company. Ask your HOA how much money they have spent on CAI attorneys in the past five years. How much money has the insurance company paid the CAI attorney in the past five years if there has been any HOA lawsuits?
Once every homeowner reviews the waste of HOA money which the homeowners ultimately pay, they will understand that having CAI attorneys involved in HOAs is costly and should be avoided.
Those of us that are aware of the extortion & racketeering by CAI are doing everything in our power to expose it. I am fighting for legislation to take mediation out of the attorneys hands. Any fines should be dealt with in small claims court. The constitution demands that any fine over $25 shall have a jury trial. Fair & Equal.
ADRE was interested in mediation for HOA dispute resolution and asked my opinion. I said that as long as the CAI attorney is advising HOA boards mediation will fail, because CAI is dogmatic in protecting the HOA. In sharp contrast to its PR releases, it is not interested in better communities and happy homeowners, not at all.
CAI is definitely not a neutral party and any suggestion that its proposed SOLVE-IT Mediation Services is a solution is just laughable. CAI preys on uninformed and misinformed homeowners.
No! CAI doesn’t believe in Homeowners Constitutional Rights, Due Process Rights or any other Rights. They fight for legislation to take our homes faster with Super Priority Liens. They promote no 6th amendment rights to attorneys, yet they are made up of PMs & Attorneys. CAI takes advantage of poorly written laws, & uses them to profit from the demise of homeowners.
CAI mediators would be a horrible choice for the homeowner against his/her board. The management companies and HOA lawyers rule the CAI. This is not an answer to the problems of living under unfair and unjust rules. The ego driven board members love their power over their subjects. I had to short sell to get out of one insane group of board members and now I live in a community with 2 board members who have served fro 15 years each. They are self serving and abusive. Living in an HOA can be very problematic because it is all about crazy people. It is hard to make laws which will eliminate CRAZY.