California’s Davis-Stirling Act creates CIDs as state actors

Dear California Legislators,

While civ: 1352 of the Davis-Stirling Act (please note that this Act has been placed under the Civil Code and not the Business and Profession Code) declares how a CID is created, “This title applies and a common interest development is created whenever a separate interest coupled with an interest in the common area or membership in the association ….”, 1363(a) mandates a homeowners association, to be known as a community association and not a CID association, “A common interest development shall be managed by an association that may be incorporated or unincorporated. The association may be referred to as a community association.” Yet this imposition of a private government lacks any homeowner protection as with a Homeowner Bill of Rights, nor does this provision require approval by a state agency or legislature, as would be required if the CID were attempting to form an incorporated community within the state structure.

The operative word is “shall” and constitutes a delegation of legislative powers to the community association. Under common interpretations of the US Constitution, this makes the association a state actor and subject to the 14th Amendment prohibitions as any other government body.(1) This state of affairs subjects these CIDs to meeting the recognized standards of proper due process equal application of the laws protections under the 14th Amendment.

While paragraph 1363(g) seems to provide proper notification of “crimes against the CID” by requiring that a schedule of violations be adopted and provided to each homeowner, much like in the public sector where criminal law requires that a crime must be contained in some statute, “[T]he board of directors shall adopt and distribute to each member, by personal delivery or first-class mail, a schedule of the monetary penalties that may be assessed for those violations . . . .”

However, paragraph 1363(h) only requires,

When the board of directors is to meet to consider or impose discipline upon a member, the board shall notify the member in writing, by either personal delivery or first-class mail, at least 10 days prior to the meeting. The notification shall contain, at a minimum, the date, time, and place of the meeting, the nature of the alleged violation for which a member may be disciplined, and a statement that the member has a right to attend and may address the board at the meeting.

This provision does not meet the accepted standards of due process that demands an impartial hearing where the accused may confront the accusers and present and examine witnesses. The homeowners are being short changed.

Under Article 4 of SB551 we have a very good move toward providing for this independent tribunal as a very good attempt to meet established requirements for due process. It’s unfortunate that the bill does not provide a mechanism to insure that the proposed bureau will indeed be there to serve justice for all. A “a pay as you go” procedure, as adopted in Arizona and as we have in the public sector, is a more appropriate approach to attaining this justice.

Notes:
1. See generally, Brentwood Academy v. Tennessee Athletic School ,531 US 288 (2001) (tests for state action); Steven Siegel, The Constitution & Private Govt, W & M Bill Rts J 461 (Summer 1998).

Where's California's Homeowners Bill of Rights?

Excerpt from letter to California’s Law Review Commission.

In Memorandum 2006-25, Dispute Resolution has been introduced as a new area of concern, still without first establishing those rights belonging to the homeowners, and those prohibitions on the restriction and denial of those rights by the association board or state laws. In other words, the Homeowners Bill of Rights is still placed on “Reserved” status. What I find alarming in MM06-25 is the determinations by CLRC of the existing methods of justice and due process for homeowners: civil action without any state involvement.

Civil Action to Enforce Governing Documents
Section 1354 provides for judicial enforcement of an association’s governing documents. That section is continued without substantive change in proposed Section 5125.

Civil Action to Enforce Statutory CID Law
In order to provide clear guidance on the issue, proposed Section 5130 would authorize a civil action to enforce any provision of the Davis-Stirling Act.

Where is the State of California in this entire affair? It has imposed the Davis-Stirling Act on homeowners that permits the taking of his home for sums that are often a fraction of the value of the home lost in foreclosure. That also sanctions and makes legal actions by associations boards that place restrictions on a citizen’s constitutional rights without appropriate due process. What the state offers, instead, is a civil action — a “leave me out of it, but obey the law” attitude with no bill of rights protections for the homeowner. This can no longer be tolerated if America and California are to continue to lie claim to be democratic, the land of equal laws where fundamental rights and freedoms are guaranteed. Civil action amounts to a bar against justice much as the imposition of poll tax in the South in the 1950s used to prevent blacks from registering to vote. Justice for the average homeowner cannot be had a price which he cannot afford while the association is allowed to use member dues to hire a lawyer. Why not provide a law that the associations must subject themselves not to a general Ombudsman fee, but to fee for a general litigation fund for homeowners to fight association abuse?

The complete letter can be found at CLRC.

Where’s California’s Homeowners Bill of Rights?

Excerpt from letter to California’s Law Review Commission.

In Memorandum 2006-25, Dispute Resolution has been introduced as a new area of concern, still without first establishing those rights belonging to the homeowners, and those prohibitions on the restriction and denial of those rights by the association board or state laws. In other words, the Homeowners Bill of Rights is still placed on “Reserved” status. What I find alarming in MM06-25 is the determinations by CLRC of the existing methods of justice and due process for homeowners: civil action without any state involvement.

Civil Action to Enforce Governing Documents
Section 1354 provides for judicial enforcement of an association’s governing documents. That section is continued without substantive change in proposed Section 5125.

Civil Action to Enforce Statutory CID Law
In order to provide clear guidance on the issue, proposed Section 5130 would authorize a civil action to enforce any provision of the Davis-Stirling Act.

Where is the State of California in this entire affair? It has imposed the Davis-Stirling Act on homeowners that permits the taking of his home for sums that are often a fraction of the value of the home lost in foreclosure. That also sanctions and makes legal actions by associations boards that place restrictions on a citizen’s constitutional rights without appropriate due process. What the state offers, instead, is a civil action — a “leave me out of it, but obey the law” attitude with no bill of rights protections for the homeowner. This can no longer be tolerated if America and California are to continue to lie claim to be democratic, the land of equal laws where fundamental rights and freedoms are guaranteed. Civil action amounts to a bar against justice much as the imposition of poll tax in the South in the 1950s used to prevent blacks from registering to vote. Justice for the average homeowner cannot be had a price which he cannot afford while the association is allowed to use member dues to hire a lawyer. Why not provide a law that the associations must subject themselves not to a general Ombudsman fee, but to fee for a general litigation fund for homeowners to fight association abuse?

The complete letter can be found at CLRC.

HOA Principality report updated

The report referred to in the eEditorial of April 20, 2006, National Lobbyist for HOA Principalities, has been substantially expanded and revised.

Read the Report.

Breakthrough Arizona HOA legislation

This has been a ground breaking session for homeowner advocates with the Legislature passing three substantive HOA reform bills, all signed by Governor Napolitano. Senate bills SB1007 and SB1008, sponsored by Senator Waring, and House bill, HB2824, sponsored by Representatives Farnsworth and Gorman provide important due process protections for homeowners.

Among other things, SB1007/1008 would require the HOA to provide the homeowner with a “bill of particulars” regarding alleged violations, including any witnesses and other supporting documents. The home owner must file a certified letter seeking this information, if not provided. The HOA is prohibited from taking any action unless it complies with what amounts to a “mandatory disclosure” of its allegations.

HB2824 allows the homeowner to take his complaint to the Office of Administrative Hearings for adjudication in a laid-back environment where those Rules of Civil Procedure do not apply. These rules have been used as defensive tactics by HOA attorneys against homeowners representing themselves. This process should help homeowners to receive justice in many instances of HOA board abuse of the law and of the governing documents that are found in all those media headlines.

This legislation should serve as a model to the legislatures of others states that the time has come to restore homeowner rights and to stop protecting the business interests of the special interests.