CCHAL in Calif. stands up to CAI

The California homeowner activist group, CCHAL, with Marjorie Murray as its president is moving in the right direction.  In its email distribution urging homeowners to contact their representatives to OPPOSE SB 391, CAI is called to task and criticized for its support.

“’The Community Associations Institute (CAI) and the property managers (CACM) are still “stretching the truth’ about SB391 (to put it politely.) CAI and CACM keep publishing ads saying  ‘SB391 gives HOAs the right to hold teleconference meetings during an emergency…’ This is FALSE.”

We need more advocate leaders and homeowners to speak up strongly to force CAI to defend its statements, if they dare, or to shut up!  Silence only helps CAI to increase its stature before legislatures, the media, and the public. Victory is ours by not remaining silent!  

(See If only advocates would stand up to CAI).

CAI knows its defending the indefensible. Do you know that?

HOA Constitutional Government

If only advocates would stand up to CAI

This month, April 18th and 21st,  I posted comments[1] on the dereliction of duty by state legislatures and the need for the DOJ to investigate state legislatures as well as the undue influence by CAI teachings in its School of HOA Governance[2]  Yesterday, the 23rd, it seems that CAI is trying to soften its misleading statements and failure to disclose the whole truth about HOA-Land.  Previously I had commented upon Kelly G. Richardson’s[3]  2020 article  in The Public Record,[4]

“Richardson seems to be saying that indeed a director has a fiduciary duty to the member but that duty to the HOA comes first.   He further warns directors, who have relevant knowledge and expertise, to remain mum and not speak out least he be sued. If the director chooses to speak out as he should do in the best interests of the HOA, ‘the director is not acting as a director but is an unpaid consultant and could be held liable for their advice.’”[5]

In yesterday’s “ HOA Homefront: What surprises lurk in your CC&Rs?”[6]  Richardson added to his attempt to “tell it like it is” revealing some hidden aspects of CC&Rs. (Emphasis added).

“Here are 11 things about CC&Rs that might surprise you, before you read them. 

“CC&Rs bind all owners, regardless of whether they read it, understood it, or received a full copy of it. As a recorded document, CC&Rs are a “covenant running with the land,” meaning a legal commitment attaching to the land and therefore its owners.

“Normally enforced by courts, even if they seem unreasonable. The California Supreme Court ruled in 1994 that CC&Rs are presumed enforceable, with some narrow exceptions (such as if they contradict a law).

“Original developer-supplied CC&Rs often are boilerplate with parts not applicable to the community. This is because the developer’s primary interest is to obtain quick approval from the Department of Real Estate to begin selling the homes.

“As limits upon owner autonomy, CC&Rs can seem intrusive at times. These limits help to protect neighbors from unneighborly behavior and against properties detracting from the community.”

I must admit he comes clean to a certain degree admitting to some of those hidden aspects of CC&Rs, which the interested parties including legislators and the media should have been made aware prior to any decision-making, or before buying a home in an HOA. Too late after the fact!  Additionally,  Richardson fails to “call for action” — frequently used by CAI chapters — to correct these silent gotchas by adopting my proposed legislation,[7] which plainly says,

“The association hereby waivers and surrenders any rights or claims it may have under law and herewith unconditionally and irrevocably agrees 1) to be bound by the US and State Constitutions, and laws of the State within which it is located, as if it were a subdivision of the state and a local public government entity, and 2) that constitutional law shall prevail as the supreme law of the land including over conflicting laws and legal doctrines of equitable servitudes. Legislative dereliction of duty

“Furthermore, any governing documents of an association not in compliance with the above shall be deemed amended to be in compliance, and notwithstanding the provisions of any law to the contrary, a homeowners’ association shall be deemed to have amended its governing documents to be in compliance.”

Lesson to be learned

For far too many years advocates and homeowners have failed to rally against the heavy influence of CAI on state legislators and the media, thereby allowing CAI to set the tone unchallenged.  This failure demonstrates a severe weakness to achieve HOA reforms of substance.  It is widely known, and proven countless times in other successful arenas, that legislation is accomplished by means of a widespread outcry by the “victims.”  Former Colorado Senator Morgan Carroll strongly advises her readers,

“We elect people to represent our interests, but our elected representatives cannot adequately represent you unless they hear from you. . . . If you don’t participate in your government, then the only remaining participants in the system are legislators and lobbyists.” 

It has been a long time failure by homeowner rights advocates to achieve meaningful, constitutional reforms. For whatever reason for this lack of involvement in a nationally united front, the practical reality has been the continued control and dominance by the CAI School of HOA Governance.[8] 

As an aside, CAI’s March “Call For Action”, “Grassroots Advocacy Initiatives Are More Essential Than Ever,” seems to be desperately seeking more active grassroots  involvement by its members, yet advocates remain silent.

“It is more important than ever for CAI advocates to engage in grassroots activism across the country. CAI believes it’s crucial for our members to tell legislators their stories and help them better understand the need for proper public policy decisions when approaching state legislation regulating community associations.”[9]  

Presently, Colorado’s HB 21-1229 is falling by the wayside as well as Arizona’s HB 2052, resurrected from last year’s SB 1412, both excellent reform bills.  California is facing problems with  SB 391 and in Florida  SB 623 (2020) went into defeat.

If only more had come forward and challenged, criticized, and exposed CAI we would have achieved much, much more.  Richardson’s article offers an excellent opportunity to step up to the plate!

References

[1] See Legislative dereliction of duty: supporting HOAs and   State legislatures must be held accountable for dereliction of duty.

[2] The foundation and principles of the School can be traced back to CAI’s Public Policies, The CAI Manifesto (its 2016 “white paper”), its numerous seminars and conferences, its Factbooks and surveys, its amicus briefs to the courts, and its advisories, letters, emails, newsletters, blogs etc. I have designated these foundations and principles collectively as the CAI School of HOA Governance.

[3] Kelly G. Richardson: CAI Board of Trustees 2011-2017; Community Associations Institute (CAI), National, President, 2016; College of Community Association Lawyers (CCAL), 2006; CAI’s California Legislative Action Committee, Chair, 2009, 2010; National Association of Realtors; California State Bar Association, Real Estate & Litigation Sections.

[4] HOA Homefront: Fiduciary Duty – What It Is, And Is NOT,

[5] CAI School faculty advice – managing HOAs.

[6] The Press-Enterprise, News, Housing, Opinion (April 23, 2021).

[7] See for example, Legislative dereliction of duty: supporting HOAs.

[8] Supra n. 2.

[9] See Grassroots Advocacy Initiatives Are More Essential Than Ever .

State legislatures must be held accountable for dereliction of duty

While U.S. Attorney General Merrick Garland announced a DOJ investigation into the Minneapolis police department, the AG must also start a sweeping investigation into the dereliction of duty by state legislatures in their unconstitutional support, promotion and encouragement of homeowner association legislation.  

(See Legislative dereliction of duty: supporting HOAs). 

Legislation, which affects some 23% of all Americans living in an HOA, that permits contractual, authoritarian private governments  (HOAs or community associations) not accountable to the US Constitution.

The DOJ must also investigate the role and extent of the influence on state legislatures by the national, self-proclaimed expert in HOA law, the Community Associations Institute (CAI) and its affiliate, The Foundation for Community Association Research.  The DOJ must examine the extent of the teachings of the CAI School of HOA Governance has had in creating longtime conditioning and indoctrination of legislators, the media, and the public.  

“CAI School” is a term that I use to describe the collection of all CAI statements, publications and including seminars, programs, classes, etc. that constitute the CAI Manifesto.

State legislatures must be held accountable for any undue influence by pro-HOA special interests.  CAI must be held accountable for the content of its pro-HOA advocacy.

Legislative dereliction of duty: supporting HOAs

I have strongly and repeatedly argued that the HOA declaration of CC&Rs is a devise — a legal maneuver — by real estate interests to avoid the application of the federal and state constitutions to HOAs.

 The word “may,” as found prolifically in HOA statutes, serves to legalize acts  and powers of the private HOA  entity in a round-about, subtle manner. Without the use of the “may clause,” an act of the HOA can be challenged as illegal even though it is stated in the declaration agreement that is treated as a contract. Thus, state legislatures avoid a constitutionally mandated enabling act that delegates authority to any agency or public-private entity.

The acceptance of home rule doctrine and statutes, by all states, would seem to negate any justification under judicial review for creating special laws for HOAs.  Home rule offers an alternative measure to satisfy any genuine government interest, thus making HOAs unnecessary.

So it appears that businesses can fail as well as cities, towns and states but, heaven forbid, not  the private HOA government.

Read the entire paper here.

HOAs are another form of local government

Listening to the events concerning the shooting in Brooklyn Center, MN I was surprised to learn that its form of government is based on the council-manager system.  We are more familiar with the mayor – council or mayor – manager forms of local government where the mayor is elected and plays a major role in governing the city.[1]

However, in the council-manager form the mayor is a figure head with the powers to rule the city are divided between the elected city council and a city manager  appointed by the council.  Sound familiar?  Many HOA Bylaws follow the council-manager form of local government, except that the Bylaws do provide for corporation laws governing the duties of officers.  This is true of the many large HOAs and the retirement/resort subdivisions.

The division of labor and authority follows the public form in that the council holds ultimate responsibility for the conduct of the government but is restricted to policy issues, while the appointed manager actually runs the HOA. A good example can be found in an Arizona active-adult HOA of some 17,000 people.

“The affairs of the Association shall be managed by a Board of Directors which shall serve as the corporate policy-making body of the Association. . . .  The Board is not responsible for nor authorized to perform day-to-day operations of the Association. The day-to-day operations of the Association shall be carried out by CAM or agents retained by the Association under the supervision of the Board.

“Subject to the Board’s responsibilities concerning operational policies, it shall be the policy of the Association . . . that the Board refrain from unreasonably interfering with the performance of delegated functions by CAM.”

The major difference between local public government Brooklyn Center, MN and the Arizona HOA lies in the private contractual nature of the HOA that absolves it from application of the US Constitution as well as the state constitution. HOA members are, as compared to non-HOA members, therefore second-class citizens lacking constitutional protections within their own state.[2]

The $64,000 question is: So why is there so much opposition to requiring the HOA to be subject to the Constitution like all other forms of local government?  BEFORE you respond, think very carefully with respect to the implication and consequences of your response.

References

[1] See in general, Roger L. Kemp, “Forms of Governance,” Managing America’s Cities: A Handbook for Local Government Productivity, McFarland & Co., (2007). They are: Strong Mayor, Council-Manager, Town Meeting (direct or representative democracy), and Commission. See also,  Home rule doctrine vs. HOA governments; CC&Rs are a devise for de facto HOA governments to escape constitutional government.

[2] See George K. Staropoli, HOA-Land Nation Within America (2019).