Author: HOAGOV

"The Voice for HOA Constitutionality". I have been a long-term homeowner rights authority, advocate and author of "The HOA-Land Nation Within America" (2019) and" Establishing the New America of independent HOA principalities" (2008). See HOA Constitutional Government at http://pvtgov.org. My efforts with HOAs took me to a broader concern that was deeply affecting the constituionality of HOAs. Those broad societal and plotical concerns caused me to start this new blog for my commentaries on the State of the New America.

The legitimacy of HOA boards and state legislatures

Is your legislature, the “sovereign” of the state, a legitimate government?  This is a question that the people, and your government, have avoided asking and answering, but it must be addressed today.  State legislatures have been acting, and the people have unknowingly accepted, the legislature as the “people” rather than as the representatives of the people.  Constitutional scholar Randy Barnett argues, in reference to Congress, but applicable to all states and state legislatures,

Many people no longer conceive of Congress as the servant of  — and checked by — the people.  Instead they picture Congress as We the People itself. Under the prevailing theory of “popular sovereignty”, the legislature is thought of as the people personified, entitled to exercise all the powers of a sovereign people.

Because “the People” can “consent” to alienate any particular liberty or right . . . legislatures . . . can restrict almost any liberty and justify it in the name of “popular consent.”[i]

We, the people, have forgotten and the legislators have ignored, that the basis of our representative system of democracy rests on the consent of the people, not on the divine right of kings, on the right of “We the People” to govern themselves. As Barnett asserts,  “They [the Founding Fathers] made this declaration because they believed that the consent of ‘We the People’ was necessary to establish a legitimate government.”[ii]   We have witnessed decisions by the California Law Review Commission[iii], the NJ Supreme Court[iv], the Texas Supreme Court[v] and the Arizona Legislature[vi], to name a few instances, completely contrary to a just and faithful representation of the people within their respective states.  And it is this failure to represent, in good faith, all the people for their benefit — the general public — and not for the benefit of a “faction” of the people, whose influence is weighted so heavily as a result of the moneyed special interests that gives rise to concerns about the legitimacy of our legislatures.

The legitimacy of our government, as set forth in the Preamble to the Constitution, rests on the consent of the people.  But, in a representative system of government the practical answer to 100% consent, or “actual consent” by each and every person, is “majoritarian” rule, or the rule of the majority.  Understanding that our legal system, not moral system, holds all non-consenting people to be bound by the proper decision of the majority.  In other words, all the people are held to acquiesce and to obey the decisions of the majority, even those to which they did not give their actual consent.  The important question that must be asked is: Does this practical solution to the effective functioning of a representative system create a moral obligation in conscience to obey the law?  Barnett sheds some further light on this question,

Only if it is legitimate can an existing constitutional system issue commands to the citizenry that bind individuals in conscience.  Therefore, though some degree of acquiescence may be necessary to establish a command as positive law, more than acquiescence is needed to create a moral duty to obey such a command.

[Majority] consent legitimates lawmaking only on the assumption that individuals have rights and there are things no person or group can do to them without violating their rights.  For a law is just, and therefore binding in conscience, if its restrictions are (1) necessary to protect the rights of others and (2) proper insofar as they do not violate the preexisting rights of the persons on whom they are imposed.

Without actual consent, liberty must be strictly protected. In the absence of actual consent, a legitimate lawmaking process is one that provides adequate assurances that the laws it validates are just in this respect.  If a lawmaking process provides these assurances, then it is “legitimate” and the commands it issues are . . . . binding in conscience unless shown to be unjust.[vii]

When we examine bills before our legislature, especially those bills protecting homeowner associations or denying the people their rights, freedoms, and liberties; and their privileges and immunities under their state constitutions, we should be conscious of the legislature’s obligations to the people  that they represent.  That they are not a government unto themselves that cannot do any wrong!  That their legitimacy rests on just laws respecting the rights and privileges of the people without violating the rights of others.  That their acquiescence to obey these unjust laws and covenants cannot be misconstrued and interpreted as having  consented in good conscience to have agreed with the laws or with the HOA’s governing documents.  

The pro-HOA supporters led by the national lobbying group, and self-proclaimed educator for HOAs, CAI, simplify the above to a false and erroneous sound bite that the homeowner “agreed to the governing documents.”

The vast majority of these HOA and condo statutes and “acts” do not measure up to qualify as legitimate laws.  The government, realizing that it cannot achieve a voluntary acceptance and willingness by homeowners to obey these laws in conscience,  must resort to repressive and punitive laws as found in any other dictatorship or banana republic, even those with a facade that the people have a right to vote.  These unjust laws mimic the private government “constitutions”, the governing documents of these planned communities, with their authoritarian HOA governments.

America needs to return to fundamental democratic principles, and to the unmistaken intent, goals and objectives of the Founding Fathers, that does not include “maintaining property values”, as summarized in the Preamble to the Constitution:

We the people of the United States, in order to form a more perfect union, establish justice, insure domestic tranquility, provide for the common defense, promote the general welfare, and secure the blessings of liberty to ourselves and our posterity, do ordain and establish this Constitution for the United States of America.

 

References

[i] Randy E. Barnett, Restoring the Lost Constitution: The Presumption of Liberty, Ch. 2 (Princeton University Press, 2004).

[ii] Id, Ch. 1.

[iii] George K. Staropoli email letter of April 11, 2006 to Mr. Hebert, Exec. Dir., California Law Review Commission in reference to AB 1921 (major rewrite of the Davis-Stirling Act, absent Chapter 2, Member Bill of Rights (http://pvtgov.org/pvtgov/downloads/AB1921_letter.pdf).

[iv]  Committee for a Better Twin Rivers v. Twin Rivers, 929 A.2d 1060 (NJ 2007) (HOA constitutional free speech case) (http://pvtgov.org/pvtgov/downloads/TR_SC_decision.pdf).

[v] Inwood v. Harris 736 S.W.2d 632 (Tex. 1987) (homestead; covenants running with the land supersede Texas constitution).

[vi] Failure to pass HB 2034 (2009) and HB2153 (2010) asserting public government, not HOA, control over public streets; default superior court decision in February 2009 declaring an Arizona statute providing for the independent tribunal adjudication of HOA disputes by the Office of Administrative Hearings as unconstitutional.(http://pvtgov.org/pvtgov/downloads/OAH-constitutionality.pdf).

[vii] Supra, n. 2

Dysfunctional legislatures supporting de facto private HOA second governments

 

“Wherever the real power in a Government lies, there is the danger of oppression.”   James Madison.

In my prior commentaries[1] on Arizona’s constitutional question of “who controls public streets”, HB 2153, I spoke of “legitimate governments” and made it quite clear that a contractual, private de facto government — an HOA — cannot be held to be legitimate.   The homeowner associations government  is chartered not under the statutes and constitution that govern de jure, legitimate, public entities, but is chartered under corporation law. Where corporate law is applied in an uneven manner and subservient to the common laws of equitable servitudes.  And where servitude law has been upheld by the courts and recommended as the controlling body of law when in conflict with constitutional law. 

It appears my arguments, mainly borrowed from legal documents and constitutional scholars, against the private government HOA control of public streets has failed to bring legislative leaders to their senses.  Any actions not in support of, or failures to act in support of,  the supreme law of the land and the laws and Arizona Constitution does, in itself, raise questions of the legitimacy of our state government.  And of the consent and obedience in conscience to be bound by any such laws or “commands” of the legislature. In a very practical and real manner, it is a question of the legitimacy of the actions of the legislative leaders who are members of the majority party that controls the legislature in Arizona — the Republican Party. 

Constitutional scholar Randy Barnett speaks about legitimacy, consent to be governed, and obedience[2]: 

Only if it is legitimate can an existing constitutional system issue commands to the citizenry that bind individuals in conscience. Consent legitimates lawmaking only on the assumption that individuals have rights and there are things no person or group can do to them without violating their rights.  For a law is just, and therefore binding in conscience, if its restrictions are (1) necessary to protect the rights of others and (2) proper insofar as they do not violate the preexisting rights of the persons on whom they are imposed.

Though actual consent [100% consent of the governed] can justify restrictions on freedom, without actual consent [or majority rule], liberty must be strictly protected. In the absence of actual consent, a legitimate lawmaking process is one that provides adequate assurances that the laws it validates are just in this respect.

“If angels were to govern men, neither external nor internal controls on government would be necessary.”  James Madison.

For an unspoken reason, the Senate leadership appears set on withholding HB 2153 from a vote by the people’s representatives.  Having already passed the House, I cannot envision any justification for holding this bill, for this willingness to abdicate legislative powers and authorities to private, contractual organizations. Organizations whose “constitution” obtains it power over the people within the subdivision, not by constitutional law, but by the common law of equitable servitudes.  This failure to hold a vote in the GOV committee sends the message, “who needs the Constitution”?  It is a repudiation of the Constitution that legislators are obligated to uphold.  It reveals a dysfunctional legislature, as we witness on the national level in Congress, reflecting a divisive ideology as author Brownstein describes in The Second Civil War[3]: 

The political system has evolved to a point where the vast majority of elected officials in each party feel comfortable only in advancing ideas acceptable to their core supporters. . . . The political system now rewards ideology over pragmatism. . . . What’s unusual now is that the political system is more polarized than the country. Rather than reducing the level of conflict [the legislature] increases it.

 
The Constitution does not permit a second, private, form of political government in America!

Let HB 2153 be heard in the GOV committee, and passed on to the full Senate!

References

1.  In general, see  HOA Private Government (http://starman.com/HOAGOV).  See also, Guest Opinion,  Government of the people, by the people, for the HOA, William M. Brown (internet commentary).

2.  Randy E. Barnett, Restoring the Lost Constitution: The Presumption of Liberty (Princeton University Press, 2004).

3.  Ronald Brownstein, The Second Ciivl War: How Extreme Partisanship Has Paralyzed Washington and Polarized America (Penguin Books 2007).

 

 

Government of the people, by the people, for the HOA

 

The following email letter from Mr. Brown to the Arizona legislative leaders reflects his concern about democracy in America.  (For more information on this HOA bill, please see public streets: the battleground for private or public government control).   

hoa constitution
hoa constitution

My dear President Burns, Chairman Tibshraeny, Vice-Chairman Harper, Members of the Senate Government Institutions Committee, Senator Bunch, Representative Barto, Co-Sponsors of HB2153 and Representative Barnes:

“From time to time we read in the newspapers, or hear on the radio, about policies and procedures and practices in the Arizona legislature. Most often that which we read or head is critical of how the legislature goes about its business. Words such as “fair” and “open” and “level playing field” are used, as if to imply that the legislature should operate in a significantly different manner that it does.” Senator Randall Gnant, “From Idea…..To Bill…..To Law, The Legislative Process in Arizona,” February 2000

The Guest Opinion, “Who controls public streets,” Arizona Capitol Times, April 1, 2010, is on-point re the proposed HB2153 legislation as well as the global issues respecting associations’ control of property not owned by an association, associations’ control of the conduct and actions of Arizona citizens clearly not subject to the association’s governing documents and associations’ coveted power and dominion over homeowners subject to the association’s governing documents, the sacrosanct “private contract.”

Association stakeholders opposed to HB2153 regularly blur the lines between their long-held belief in “private contracts” not to be interfered with by federal, state, county and/or municipal governments and certainly not the legislature unless and until it suits the stakeholders and their client associations’ interests as evidenced by associations’ growing reliance on “what can government do for” stakeholders and associations today. (See Community Resource, Issue 1 / 2010, “What Your Local Government Can Do For You,” Community Associations Institute / Central Arizona Chapter, attached)

“Getting a hearing on a bill is a crucial first step for individual citizens, lobbyists, special interest groups and state agencies..in the Senate, bills that receive a hearing have a high likelihood of passing the full Senate. So, while failure to secure a hearing is a virtual disaster for a bill, getting a hearing takes a bill on the longest step towards becoming law.” (Gnant)

Please include HB2153 on the Committee On Government Institutions’ agenda, Consideration of Bills, permitting the peoples’ representatives in the Senate to vote on the bill’s passage as your brethren in the House, the people’s other representatives, did so on February 17, 2010 (43/14/03).

Respectfully,

William M. Brown

Sun City HOA: a real independent principality

Sun City, AZ. a renowned retirement community, is an unincorporated town under the governance of the Sun City HOA (SCHOA).  It does not qualify as a planned community or as an HOA under the state’s statutes. SCHOA is a private nonprofit corporation — no mayor & no town council, governs it.  A sort of a throw back to the times when the sovereign, the king, issued charters or grants of authority to private organizations to conduct business or to govern new lands.

In modern times, does the nonprofit corporation charter by the state, the new “sovereign” of a republic, truly grant a nonprofit corporation the right to function as the legitimate government of a sub-division of the state?  This could not possibly the intent of the corporation statutes since the state abounds with municipal corporation statutes — cities, towns, special districts, etc. — and with methods and procedures for incorporating new towns and cities.  The appeal of direct democracy, local government control or “home rule” is understood, and agreeing to be governed by a business form of government under corporate laws could be viewed as a strong desire for independence from unwanted influences and intrusions.

Sun City is indeed such an independent government, not answerable under state municipality laws or the Constitution, as it is not subject to the planned communities statutes. Sun City is just subject to the broader corporation statutes that were in no way written to establish a democratic form of political government.  This sort of independent principality status has more in common with a tribal society where the inhabitants of the village are loyal first and foremost to their tribe and village, and to the leaders of the tribe, than to their state or country.

This tribalism reveals itself as the Sun City HOA does not require mandatory assessments, yet each deed requires that the owner make mandatory payments to another nonprofit, the Recreational Centers of Sun City (RCSC).  And in order for RCSC to qualify for common area real estate tax treatment, all owners “must be obligated to pay mandatory assessments to maintain and manage the common areas.”    Consequently, to accomplish this reduced tax basis without having to be subject to state planned community laws, a separate agreement is required to be signed by the owner agreeing to pay, not the HOA, but RSCS dues.  This is extraordinary, since the deed itself could simply require mandatory payments to a bona fide HOA that would own and manage the common areas, as is the case with a genuine HOA.

The strong desire to independent of state laws, yet to use them as above, required an amendment to the common area valuation statutes, ARS 42-13402 et seq., adding the “must be” clause above in 2000 (Ariz. Sess. L. Ch 196; HB1251).  What could have possibly been the intent of this statute other than to bestow a gift upon Sun City, an unincorporated community, tax benefits amounting to an estimated $113,000 per year, or $1,130,000 over the past 10 years?

Today, the residents of this independent “principality” are coming once again before the legislature, with the SCHOA attorney (a member of the national pro-HOA lobbying group, CAI), to deny the state its legitimate right to regulate and control the public streets within Sun City (HB 2153).  Suddenly, parking has become a safety issue in spite of the fact that, from the very beginning, the county planning board approved these alleged unsafe streets, and legal mechanisms are available to SCHOA to obtain variances on a case-by-case basis.

Don’t buy it!  Sun City is demanding complete freedom from the state with no interference into the “internal affairs” of their principality.  State cooperation, provided it is consistent with the aims and goals of Sun City, however, is acceptable and welcomed.

Is the delegation of legislative authority to private HOA entities constitutional?

When it comes to delegating governmental power and authority to state agencies, one only needs to look at the body of law surrounding the grant of authority to a state agency.  The authority for an agency to make and to enforce laws, under the state’s Administrative Procedures Act,  is subject to constitutional law with its requirements and prohibitions.

Please note that, in Arizona, the pro-HOA national lobbying organization (Carpenter Hazlewood law firm) managed to have the Office of Administrative Hearngs (OAH), a state agency, adjudication of HOA disputes declared unconstitutional, thereby depriving homeowners of their only just hearings of disputes, of due process of law. OAH resulted in 42%  of the cases being won by the Pro Per homeowner against the HOA and its attorney.  This alone speaks for the abysmal failure of HOA private governments to operate in a just and fair mode.

Understanding the above, the question arises as to the legitimate grant of governmental powers and authorities to private organizations. While not officially recognized as a de jure (under law) government, the various state HOA statute and “Acts” do grant authority to these private governments to act independent of the state laws and local ordinances.  And many times in many states, these private government arrangements, not approved or subject to review by the state,  are sometimes held superior to or supplement state laws (as when we see with, “unless otherwise provided in the governing documents”). 

The following legal doctrine and holdings apply to any private organization, and not specifically to the HOA, making any defense with respect to not being a mini-government irrelevant.

Under the “delegation doctrine”,  tests of the constitutionality of the delegation of legislative authority took place during the New Deal era of the 1930s.  With respect to the Bituminous Coal Conservation Act of 1935, private businesses were allowed to set standards and rates. Struck down because “the setting of requirements by private producers was an unconstitutional delegation of legislative power to private persons.”[i]  And in Schechter Poultry (1935), the Supreme Court held the National Industrial Recover Act to be “delegation in its most obnoxious form”, as it is “delegation to private persons whose interests may be and often are adverse to the interests of others in the same business.”[ii] 

In more recent times,  a private group controlling its competitors would not be considered an excessive delegation issue, but perhaps a procedural due process issue. The question to be answered is: Are the competitors “being deprived of due process by being subject to the will of entities with interests contrary to theirs?“[iii]  This question of delegation to private organizations can be summarized as follows,

While delegations to private organizations may be suspect, they are by no means inappropriate. . . . where delegations in limited and technical areas  . . . are quit useful  [e.g. in setting technical standards and codes for health and safety concerns].  The legitimacy of this course will, however, turn on whether these standards have been formulated by private groups that are  so constituted as to dampen special interests and whether these standards involve limited and technical areas as opposed to broad matters of public interest.[iv]

 

And in particular relevance to the setting of zoning ordinances, we have Eubank v. Richmond, 226 U.S. 137 (1912) and Eastlake v. Forest City Entr., Inc., 426 U.S. 668 (1976) where private parties were  denied the right to set zoning ordinances.  Consequently, the setting of public street parking ordinances by HOAs as private entities, for example, would be an unconstitutional delegation of legislative authority.  And by virtue of the Restatement of Servitudes, § 3.1, Validity of Covenants, any such HOA covenant would be viewed as contrary to public policy and unconstitutional as well.  (See my public statement to the Government Committee).

The pro-HOA supporters object to the above reality and argue that the homeowner voluntarily, knowingly and freely 1) agreed to be bound by the CC&Rs, and 2) to the surrender and/or waiver of his rights and freedoms when he took possession to his deed under servitudes law.  My reply, as I argue my public statement to the Government Committee, is a resounding not so!

Furthermore, the CAI national pro-HOA lobbying group and the “true believer” HOA supporters would have you believe that the HOA is just another nonprofit organization, and like these other nonprofits it’s allowed to set rules and regs, issue fines, withhold benefits in terms of privileges and access to amenities, etc.   But, where can you find another private organization whose governing documents are just about echoed by statute, thereby giving the illusion of legitimacy?  I submit that if indeed another organization can be found that controls and regulates the inhabitants within a territory, then it will be functioning as a de facto private government, or an unincorporated town or village under the municipality laws of this state.

The bona fide government interest to create a better community under local government authority and control, a form of “home rule”, be achieved today under the state’s special taxing district laws. All the private amenities, community ordinances (“rules and regs”), taxes (assessments), and enforcement rights are all doable under special taxing district laws.   What would be gained is the accountability of the district to the laws, ordinances and constitution laws to which all other forms of political government are held.  No more special laws and no more special treatment for HOAs.

Enabling HB2153 to become law will serve to draw a line in the ground.  A line directed at the HOA not to pass.