Who prosecutes for homeowner justice against HOAs?

 

April 12, 2010

Rep. L.

Arizona House of Representatives

                                                                                            email letter

 Dear Rep. L,

I’d like to thank you and your assistant for contacting me in an attempt to assist the xxxx with their condominium issues.  I had followed their earlier Petition with the now “dismissed” Office of Administrative Hearings back in March 2007 — one of the first cases to be heard by OAH. 

I spoke with Bob and reviewed his materials sent to me, and the zzzz CC&Rs.  My earlier criticism of Bob’s complaints to OAH stand today:  most constitute dissatisfaction with the performance of the board and/or property manager, but are not actionable in court (I am not a lawyer). The ALJ in 2007 found it to so, but did act on one of the 12 issues submitted to OAH for adjudication.  Bob won, and the condo association was given a $500 punitive penalty.

Sad to say, I cannot help him.  Under present legal conditions, no one can, or will be able help him attain justice — court costs, pro-HOA state laws, and an adhesion CC&Rs “contract” favoring the HOA all put the odds on the HOA’s side. I am speaking not about the dissatisfaction issues, but the real violations of state laws and the governing documents. Bob must spend his own money, like so many other homeowners, in order to obtain justice against lawbreaker associations.  While state laws make fines and foreclosure against homeowners legal, they do nothing to punish violator associations and management firms. 

The statutes do little to protect the homeowner.  He is treated with disrespect and indignity as a second-hand citizen. On one hand the statutes are “telling” the people it is of general public interest and benefit to get “deadbeats” to obey the governing documents, and to pay those assessments.  But, on the other hand, complaints against the association are dismissed as a private matter without appropriate enforcement — a class 2 misdemeanor, for example — and are not a public concern for the legislature. This failure to punish lawbreakers when it comes to associations amounts to a dual standard against the people in favor of private entities that function as authoritarian de facto private governments.

The adjudication of HOA complaints by OAH had leveled the playing field somewhat, providing attainable —”affordable”, to use a term used to defend the state’s protection of HOAs — justice, where the homeowner could go before an independent tribunal, without a lawyer and without the need to know the 100 odd rules of civil procedure contained in some 200 pages of “legalize.”  The constitutionality of the statute was not defended by the Attorney General, or by the legislative leadership, resulting in a superior court disgraceful default decision. Consequently, Bob comes before you and pleads for relief, because there is no place to go, not even to the OAH where he could once hope to have found justice.  In the short history of OAH, pro per homeowners won 42% of their petitions against their HOA and its attorney.

I’m sorry to say that, after 10 years as a homeowner rights advocate, the Arizona Legislature has created and continues to permit this shabby treatment of many good citizens, including Bob, by failing to enact HOA reforms. Reforms with enforcement against the association and a bill of rights to protect homeowners.

Respectfully,

George K. Staropoli

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.