Category: Opinion

Posts by GKS

HOA homeowner membership in CAI is a mere 36%

Since has been some time since I checked CAI’s membership breakdown, here’s some surprising news I just uncovered, right from CAI Central’s own mouth. HOA representation through “volunteers” (since HOAs per se are not allowed) consists of a mere 36%, and yet CAI has the gall to say they speak for homeowners to  federal agencies, to state legislators, to the media and to the public at large!

As I’ve said all too often, board members are targeted by CAI through discount fees based on the number who join from an HOA.  In my view, all HOA directors who are CAI members are conflicted as to whom they owe their allegiance.  To the vendor organization whose members feed off them, or to the  unit owner, members as required by the CC&Rs contract?

“Business partners” means, for the most part, attorneys; “managers” total 42%.

See CAI Marketing Opportunities, CAI Member Breakdown, page 3. I suspect the announced increase to 40,000 came from international growth.

cai membership 2017a

Rigged HOA elections create a false democracy

Long ago in 1994 Professor McKenzie wrote, “HOAs currently engage in many activities that would be prohibited if they were viewed by the courts as the equivalent of local governments.”[i]  There is no better example of HOA independence than prejudiced HOA election procedures.  In 2013 I wrote,

“HOA members have been repeatedly told that they can change things in their HOA by voting for board members and even by changing the governing documents; that HOAs are democratic because members can vote to make these changes happen. . . . Without fair elections procedures that contain enforcement against HOA board wrongful acts, including retaliatory acts and intimidation by the board, voting in an HOA is a mockery of democracy.[ii]

CAI, on the other hand, maintains in its Public Policy statement that,

“Community associations are one of the most representative and responsive forms of democracy in America today. Residents of a community freely elect neighbors to serve on the board of directors of the community.[iii]“

Let me give a prime example of far these pro-HOA procedures can go to deny members a fair and just voting process, one that subtly favors the HOA Board.  In this large scale HOA in Arizona with over 9,000 homes and some $20 million in revenues, amendments to the CC&RS and bylaws are needed to be approved by 67% of the membership.

The governing documents have an unusual, non-standard voting procedure that allows for “consent” by the members, in addition to an actual vote, which constituts a vote and are counted in the approval requirement. Members just have to fill out a form and submit it.  Surprisingly, in contrast to the public voting procedures, this procedure contains

  • no mention of a “cutoff date,” the date that the Consent Form needed to be received by the election committee. A start date, date form first distributed, is mentioned and currently is 5 months ago.
  • no opportunity for a “no” vote, just the wording that not submitting the form would be seen as choosing “ not to consenting to the documents.”
  • A biased, pro-HOA “advertising” on the form itself without any mention of opposing views. “ Moving Forward to the Future.” Other advocacy by the Board is prominent.
  • An annual membership meeting scheduled some 6 months after the ability to submit a Consent Form, but the agenda was silent on actual voting for these amendments instead of submitting a Consent Form, or announcing the results of the “vote.”

This method of voting by the HOA would not pass muster in the public realm.  So much for democracy in action. This election process is rigged in favor of approval, is unjust and negates any choice by the members who may wish to submit a NO vote.  It’s a no-lose approach for the Board since the Form does not allow for NO votes!  It would never fly under the public realm’s fair elections requirements.

In Wittenburg v. Beachwalk HOA,[iv] the California appellate court held that a board is engaged in advocacy when it supported and  urged an approval vote in its materials and communications. The Court’s view was that opposing parties must be given equal opportunity to advocate against the proposition, which is being denied in the above instance, by not allowing a no vote and the open-ended voting process of form submissions with only YES votes.

The Court held that the relevant statute was in the public interest and it sought to

“provide substantial new voting protections” to members of homeowner associations designed to “guarantee that basic democratic principles are in place during elections,” which had previously been “contaminated by manipulation, oppression and intimidation of members, as well as outright fraud.”[v]

Yet, overwhelmingly, according to the CAI surveys, HOA members standby their HOA even though it operates outside of constitutional protections and the laws of the land.  They seem to believe that, like a King, their board can do  no wrong; that, contrary to James Madison’s view that “If angels were to gvern men, neither internal  nor external controls on government would be necessary,” their board must consist of angels.

The HOA legal scheme as set forth in the governing documents and pro-HOA state laws, does not contain a fundamental principle of our constitutional system of government:  checks and balances. The HOA board basically has, for all practical purposes, a free hand to function as an authoritarian government.

By: George K. Staropoli

 

References

[i] Evan McKenzie, Privatopia: Homeowners Associations and the Rise of Residential Private Governments, Yale Univ. Press, 1994.

[ii] “Democratic Elections No. 5,” George K. Staropoli, HOA Common Sense: rejecting private government.

[iii] Section 8 in An Introduction to Community Association Living (2006).

[iv] Wittenburg v. Beachwalk HOA,  217 Cal.App.4th 654 (2013).

[v] Id.

Civic responsibility vs. HOA member responsibility.

To whom does a member of an HOA owe his loyalty?  To the constitutional government or to the HOA?   I raise this question because of the general apathy and strident defense of their HOA by many HOA members.

The inescapable conclusion is that the vast majority of the members do not care if they are governed by private, contractual corporations functioning outside constitutional government. When faced with solid evidence of violations of the law or governing documents they get highly defensive of their HOA board of directors.  It seems quite obvious that these individuals have forsaken their civic responsibilities and duties for HOA member responsibilities and rights.

Now I am sure that these individuals are good people believing that they are doing good for their community –  the HOA – and therefore good for the people in the town, state and country.  With this belief, they do  not understand that putting the HOA first damages their duties to the community at large, the town, the state and the country.

Let me explain why.  As citizens[i] of our state and country we have civic responsibilities that consist of our  “actions and attitudes associated with democratic governance and social participation.”[ii]

“The importance of civic responsibility is paramount to the success of democracy and philanthropy. By engaging in civic responsibility, citizens ensure and uphold certain democratic values written in the United States Constitution and the Bill of Rights. Those values or duties include justice, freedom, equality, diversity, authority, privacy, due process, property, participation, truth, patriotism, human rights, rule of law, tolerance, mutual assistance, self-restraint and self-respect.[iii]“

The Preamble to the Constitution says it clearly: “to establish justice”, “promote the general welfare,” and “secure the blessings of liberty.”  And what does the HOA “constitution,” the CC&Rs, stand for? Essentially,  maintaining property values and enforcing the governing documents. Since it is a contract, we can only look to the authority and responsibilities as stated in the contract, and we cannot ascribe  any part of the Preamble objectives to the CC&Rs.  Under the contract they have no such obligations to be just, fair and a good community member to oppose wrong-doings by the Board.

The choice then falls onto each member to choose to follow his conscience either as a public citizen or as a HOA member citizen.  CAI’s public policy on Rights and Responsibilities says nothing about being a good public citizen. “Good associations preserve the character of their communities, protect property values and meet the established expectations of property owners and homeowners.”[iv]  A member who defends his HOA when it has clearly violated the law or governing documents is rejecting his obligations as a public citizen.

Why does this occur? Well, for several reasons including indoctrination into a view of HOA-Land totally devoid of constitutional issues and its values, principles and objectives. This indoctrination creates a false mindset that helps to create a person’s self-image.[i]  Human nature being as it is, a person’s self-image will protect the person from harm.  Your self-image is basically who you are, what you stand for and what you believe in.  It can only change when a new self-image is adopted and substituted for the old image, making the person “whole” again —  a good person again.

Another aspect of human nature that plays on the member’s self-image is the need for approval and validation (the member’s feelings, attitudes and opinions are worthwhile).  The HOA indoctrination program plays to these needs by setting the criteria for approval – homeowners must obey the rules and maintain community spirit – and validation – praise for attending meetings and hearings and supporting the HOA Board.

Understand that the members can change their misguided view that their HOA is governed by angels and can therefore do no wrong.  All that they must do is to listen to the facts and evidence that would be seen as wrongful behavior if conducted with respect to non-HOA issues.

Good citizens, as stated herein, will recognize the need for change to maintain a healthy self-image and restore constitutional government within HOA-Land.

 

References

[i] “Fostering a Positive Self-Image,” ClevelandClinic.org.  “Self-image is the personal view, or mental picture, that we have of ourselves. Self-image is an “internal dictionary” that describes the characteristics of the self”; “is a product of learning”; “is important because how we think about ourselves affects how we feel about ourselves and how we interact with others and the world around us”; is not permanently fixed. Part of our self-image is dynamic and changing. We can learn to develop a healthier and more accurate view of ourselves”.

Good citizens, as stated herein, will recognize the need for change to maintain a healthy self-image and restore constitutional government within HOA-Land.

By: George K. Staropoli, GKS256@nyu.edu.

References

[i] “Civic Responsibility,” Jennifer Self, Learningtogive.org, “A citizen is ‘a person owing loyalty to and entitled by birth or naturalization to the protection of a state or union.’ Citizenship means ‘a productive, responsible, caring and contributing member of society.'”

[ii] Id., “The importance of civic responsibility is paramount to the success of democracy and philanthropy. By engaging in civic responsibility, citizens ensure and uphold certain democratic values written in the founding documents and uphold certain democratic values written in the founding.”

[iii] Supra n. i.

[iv] “Rights and Responsibilities for Better Communities,” CAI Public Policy 2011. Feb. 19,2019.

[v] “Fostering a Positive Self-Image,” ClevelandClinic.org.  “Self-image is the personal view, or mental picture, that we have of ourselves. Self-image is an ‘internal dictionary’ that describes the characteristics of the self’; ‘is a product of learning’; ‘is important because how we think about ourselves affects how we feel about ourselves and how we interact with others and the world around us’; is not permanently fixed;  Part of our self-image is dynamic and changing. We can learn to develop a healthier and more accurate view of ourselves”.

Was the 1994 AZ HOA enabling act just for the Sun Cities?

I thought Arizona HB 2374 would pass the House GOV committee. The sponsor, Keven Payne, is also the Vice-Chair of the committee. However, I am surprised at the close vote, which from my experience, indicates rebellious legislators. Yes, House COW and the Senate are next challenges.

We must educate the legislators as to the true nature of the bill. It is more than what the sponsor claims in the bill. Payne will not address the constitutional violations raised by this bill. That’s our strong point, if advocates are not afraid to stand up.

It is interesting to note that the sponsor is well aware of a possible constitutionality challenge to HB 2374 when he included Sec. 3, Legislative intent. He argues that the purpose of the bill would be “clarifying changes that are consistent with the legislature’s intent in 1994 in first enacting section 33-1802.” The original, HOA enabling act of 1994 is silent on legislative intent. It seems that there’s some tea reading and divination going on.

This defense by Payne above seems to imply that the intent of the Planned Communities Act in 1994 was just for these two Sun City developments by Del Webb.  It makes sense, doesn’t it?

However, the purpose of the bill is quite clear and obvious — overturn the court’s ruling in Anderson v. RCSC (see More government interference – AZ HB 2374) and protect the HOA scheme against homeowner property rights.

Again, we return to constitutional matters and the court’s doctrine on interpreting wording of laws. What does the statute contract interpretation say? The recent AZ appellate discussion in Meyer v. State of Arizona (No. 1 CA-CV 18-0031, 2/5/2019; voter rights) explains the judicial doctrine on contract and statute interpretation.

Here, we get entangled with everyday meanings of terms and words, and what does the law explicitly state. As raised by RCSC, it cannot be an HOA because the definition requires that an HOA must be established by a declaration.

“RCSC argues that the ‘declarations’ do not establish RCSC or its ability to assess mandatory assessments. The Court believes RCSC’s argument elevates form over substance. ‘Declaration’ is broadly defined to mean “any instruments, however denominated, that establish a planned community and any amendment to those instruments. A.R.S. § 33-1801(3).”

However, the court pointed out that RSCS has the authority, accepted by the homeowner in a signed agreement specified in the CC&Rs, to act in place of the HOA. The court didn’t buy the RCSC subterfuge. “If it looks like a duck, swims like a duck, and quacks like a duck, then it probably is a duck…” The court granted a summary judgment — no material differences on the issues. The ruling has not been challenged.

What to do if you don’t get your way?  Go to the legislature and change the law, that’s what!

AG in AZ defends HOA dispute constitutionality challenge

In 2006 in Arizona the Legislature passed a bill[1] providing for the Office of Administrative Hearings, through the DFBLS agency, to resolve HOA disputes. Over the years from 2007 – 2011 its constitutionality was challenged several times by CAI Arizona, resulting in declarations of unconstitutionality. However, in the final case, Gelb, the AZ Supreme Court de-published the ruling as applied to ALL HOAs, making it non-binding precedent. In 2011 the statute was amended, addressing Gelb.[2]

The Arizona Attorney General, nor the Legislature, intervened in support of constitutionality. Not any longer. In its Answering Brief[3] to the challenge by the HOA in CBS-136 HOA[4], the Assistant AG provides a history of these decisions; and supports the constitutionality of OAH disputes of HOA issues by ADRE. It is a slap in the face of CAI’s attempts from 2007 – 2011 to kill OAH. The AG responded for once in this delicate statute in favor of OAH resolution.

The brief also contains a summary of the Gelb[5] case where the AZ Supreme Court ordered the appellate court ruling in favor of unconstitutionality to be de-published – not binding precedent.  “But in May 2011, the Arizona Supreme Court denied review and ordered the Court of Appeals’ decision de-published without explanation.”[6] I played a role in that decision when I submitted, pro se, an amicus brief to the Court, which was accepted.[7]

This is a major change in the attitude of the AG’s office, long overdue. ADRE may not be perfect, but it’s a step in the right direction. What is needed is legislation to close the loopholes that CAI has been using to defeat its purpose.

References

[1] Ariz. Sess. Laws, ch. 324 (2006).

[2] Ariz. Sess. Laws, ch. 185 (2011).

[3] See  state of AZ brief.

[4] CBS-136 HOA v. Cohen, No. LC2018-000316, Maricopa Superior Court 2018.

[5] Gelb v. Dep’t of Fire, Bldg. & Life Safety, 225 Ariz. 515 (App. 2010).

[6] CV 10-0371, 2011 (Ariz. May 24, 2011 ).

[7] See “AZ Supreme Court accepts advocate’s amicus brief in challenge to HOA statute”