HOA Constitutional Government

Many times, regarding the constitutionality of statutes, I have come across the long standing legal doctrine that the statute is presumed constitutional and that the challenger bears the burden of proving otherwise.

The following opinion in Biggs speaks to statutes that are not a violation of fundamental rights, leaving the fundamentality question unanswered.

Determining constitutionality is a question of law, which we review de novo [ a new case analysis]. When the statute in question involves no fundamental constitutional rights . . . we presume the statute is constitutional and will uphold it unless it clearly is not. (¶ 9).[1]

The justification for this doctrine is explained in the Arizona appellate court opinion in Vong,

“The Constitution presumes that, absent some reason to infer antipathy, even improvident decisions will eventually be rectified by the democratic process and that judicial intervention is generally unwarranted no matter how unwisely we may think a political branch has acted.[2]”

In other words, our elected representatives, who had enabled the challenge statute to begin with, will react to the outrage of the people and correct their legal folly. Yeah, right! Not in this dysfunctional climate!  The courts will not interfere, not even when the statute is a horrendous violation of the Constitution.

With respect to determining constitutionality, the court must examine the statute itself, its wording and grammar (including punctuation), and the intent of the drafter or framers of the statute. The intent of the legislature, with respect to HOA-Land statutes in all states, has become very important as numerous constitutionality challenges have arisen lately.  The Court in Biggs made the importance of the intent of the framers very clear,

The Constitution should be construed so as to ascertain and give effect to the intent and purpose of the framers and the people who adopted it. We give effect to the purpose indicated, by a fair interpretation of the language used, and unless the context suggests otherwise words are to be given their natural, obvious and ordinary meaning. (¶ 10).[3]

The intent and purposes of the Framers was long upheld by the FCC as concerning the media providing equal opportunity to reply on public issues.  “The FCC believed that broadcast licenses (required for both radio and terrestrial TV stations) were a form of public trust and, as such, licensees should provide balanced and fair coverage of controversial issues.[4]”

But President Reagan did not see it that way when he vetoed fairness legislation in 1987.

“This type of content-based regulation by the federal government is, in my judgment, antagonistic to the freedom of expression guaranteed by the First Amendment,” Reagan said in his veto message. “In any other medium besides broadcasting, such federal policing of the editorial judgment of journalists would be unthinkable.”[5]

As it has come to pass, the power of the people has been slowly eroded and replaced by that of the business special interests.  In Arizona, for instance, the legislative bill manual advises against inserting “legislative intent’ wordings as it may require the sponsors to defend themselves at a later time. “4.19. Generally, intent sections (also called “purpose” or “legislative findings” sections) should not be used in a bill.[6]”

And so, the people, and especially the “citizens” of HOA-Land, are faced with an insurmountable obstacle to fairness and justice when attempting to challenge the constitutionality of HOA statutes.

 

References

[1] Biggs v. Betlach, No. CV-17-0130-PR (Ariz. November 17, 2017).

^[2] Vong v. La Vie,  CA-CV 13-0423, (Ariz. App. Div. 1, 2014).

[3] Supra, n.1, ¶ 10.

[4] “The death of the Fairness Doctrine and the rise of HOA-Land media bias”.

[5] Id.

[6]  The Arizona Legislative Bill Drafting Manual 2017 – 2018.  

On Nov. 9, 2017 CAI issued an internet news release on the Yahoo Groups e-list, CAIerelease@yahoogroups.com, to selected members.  This release, as usual, touts the greatness of CAI, but this time it’s an outright member survey.

CAI Member Needs Assessment Survey” release. Its stated purpose was to allow “us to hear directly from our members and ultimately gather a better understanding of the essential needs and significant challenges our members face living in today’s community associations.

I am a member of the Group, but not surprisingly apparently a persona non-grata member as I don’t receive copies of releases nor can I see the survey results.   Instead, if you are not a member, you can rely on the summary provided in the news release as no other ‘facts’ are provided. However, the release does state, “SELRES_2d85eb01-5a56-42d3-8b8a-67b5beb0dd1eSELRES_037bd84e-972f-44be-9885-377f4a303540SELRES_e236a0bf-ec96-4d49-acfe-a9872651b5daCOMMUNITY ASSOCIATIONS INSTITUTE (CAI) RELEASES MEMBERSHIP SURVEY.”  But whereSELRES_e236a0bf-ec96-4d49-acfe-a9872651b5daSELRES_037bd84e-972f-44be-9885-377f4a303540SELRES_2d85eb01-5a56-42d3-8b8a-67b5beb0dd1e?

The short release goes on to simply assert that,

[T]he most important issues facing community associations are uniformed boards, increased legislative/regulatory oversight . . .. CAI members are concerned about state regulations impacting community associations, and an overwhelming majority of CAI members surveyed (92 percent as compared to 89 percent in 2013) agreed that CAI advocates on behalf of community association interests and responds to legislative, legal, and regulatory activities. 

In short, very short, CAI makes the claim that overwhelmingly it’s members support its lobbying activity for HOAs that are opposed to state regulation. Isn’t CAI supposed to lobby for its industry, which can be loosely classified as HOA services and not for HOAs? The pertinent lobbying would be, naturally, for the advancement of its vendor members as a 501(c)6 trade organization should be advocating.

CAI rightfully argues that boards are largely uninformed, but it fails to identify CAI, the international HOA educator, as the culprit for providing self-serving propaganda rather than the truth of the matter.  (See in general, HOA Common Sense: rejecting private government).

But, who are these members of this business trade group? Surely not HOAs that are consumers of CAI’s member services. CAI fails to inform readers that its membership does not include HOAs per se, and that only a minority of 32.8% (as of 2016) of its members are “volunteers.”  In my Sept. 2017 analysis of CAI’s “Fact” Book, (CAI 2016 Factbook: looking into the ‘facts’), I summarized the CAI Indiana Chapter data from its survey of some 23 state chapters. (The Indiana Chapter data can be found here). I wrote,

I came across data from the CAI Indiana chapter for 2015 and 2016. The percent ‘volunteers’ per HOA for both years was 32.7% and 32.8%, respectively. (Of the 33,000 CAI members, a minority of some 10,800 are ‘volunteers’ and not attorneys or managers.)

Furthermore, a clear majority of these “volunteers” are HOA board members.  CAI recruits these “volunteers” by offering discounted fees for multiple directors from the same HOA, paid for by member assessments.  Talk about a legal loop-hole!

It’s not surprising that CAI’s factual survey is unprofessionally biased and constitutes self-serving propaganda, which has undoubtedly been distributed to the policymakers, state legislators, the media, and the general public. Shame, shame!

And yet there are many who still believe that CAI is the path to substantial HOA reforms for homeowner rights.  They refuse to take off their rose-colored glasses and deal with the reality of some 44 years of CAI’s failure to solve HOA problems; failing in its reason for being when formed in 1973.

The following are excerpts from the text of Sen. Jeff Flake’s remarks from the floor of the U.S. Senate on Oct. 24, 2017, as prepared for delivery.

The notion that one should stay silent as the norms and values that keep America strong are undermined and . . .  the notion that one should say and do nothing [is] profoundly misguided.

.   .   .   .   .   .

We must never regard as “normal” the regular and casual undermining of our democratic norms and ideals. We must never meekly accept the daily sundering of our country . . .  the threats against principles, freedoms, and institutions; the flagrant disregard for truth or decency . . ..

.   .   .   .   .   .

Acting on conscience and principle is the manner in which we express our moral selves, and as such, loyalty to conscience and principle should supersede loyalty to any man or party.

And “loyalty to conscience and principle should supersede loyalty to” any special interest agenda or manifesto[1] or propaganda statements[2].

Read Flake’s bombshell Senate speech October 24, 2017.

References

[1]  CAI manifesto: CAI’s plan for HOA-Land in America.

[2]  See in general, CAI: the HOA form of government is independent of the US Constitution.

The policy makers have failed to understand that the HOA CC&Rs have crossed over the line between purely property restrictions to establishing unregulated and authoritarian private governments. (George K. Staropoli)

CAI continues its marketing propaganda[1] lauding such objectives as: collective management, privatization of government, affordable housing, and social costs and marketing efficiencies.  Yet, CAI continues to ignore allegations that HOAs are authoritarian private governments relying on compliance by coercion; and operating outside the US Constitution with its protections of individual rights — the fundamental basis of the American social contract.

This press release seems to echo the philosophy of WWII Italian dictator, Benito Mussolini, the father of fascism.[2]

Anti-individualistic, the Fascist conception is for the State; and it is for the individual in so far as he coincides with the State…. Liberalism denied the State in the interests of the particular individual; Fascism reaffirms the State as the true reality of the individual.[3]

A fitting, modern interpretation of this anti-American, authoritarian philosophy can easily be applied to HOA-Land:

Against individual member rights, the homeowner association concept is for the HOA; and it is for the individual in so far as he conforms to the covenants, bylaws and rules and regulations of the HOA . . . the free expression of individual rights and freedoms rejected the HOA in the interest of the individual; the homeowner association concept reaffirms the HOA as the true objective of member obligations and duties. (George K. Staropoli).

It is unconscionable that this country has adopted the legal doctrine that any bill passed by a legislature is presumed to be constitutional, requiring a citizen to file a costly lawsuit challenging the constitutionality of the bill.  One would think that the legislature, and other government officials, would stand by the bill in question and defend its constitutionality.  Not so![4]

On the other hand, one would expect that the legislators, in good conscience, would reject any bill or repeal any statute that they found a violation of the Bill of Rights, or the state’s equivalent Declaration of Rights; or an unconstitutional violation of the 14^th Amendment’s due process and equal protection of the law clauses.  Not so!

A long time ago in 1994, Prof. Evan McKenzie wrote in his landmark book, Privatopia, “HOAs currently engage in many activities that would be prohibited if they were viewed by the courts as the equivalent of local governments.”[5]

I believe that our elected officials are quite familiar with this aspect of private, contractual governments hiding behind a simple, single phrase in the first clause, Article I, Section 10 of the US Constitution, “No state shall . . . pass any law . . .  impairing the obligation of contracts.”  The dominance of this impairment clause provides them with a misguided justification that permits the denial of the 14th Amendment protections.

It is long past time for the legislature to restore constitutional protections of individual rights, freedoms, privileges and immunities for their citizens living in HOA-Land.  Protections that were removed by misguided statutes creating special laws for special interests based on misrepresentations. Passing this bill into law would be a giant step forward.

The proposed Arizona Department of Homeowners Association (ADHOA) bill[6]

The intent of this bill can be found in my speaking for the legislature in Section 16, Legislative Intent, (was Section 20), of this 20-page bill.[7]  The bill is formatted according to legislative standards.[8]

Highlights of the bill:

1. Adds OAH due process to 33-1256 and 33-1803.
2. Creates Dept. of HOAs under Title 41, adding Chapter 20 that replaces ADRE statutes.
3. Authorizes ADHOA Commissioner to enforce AZ Constitution, Chapter 2, Declaration of Rights.
4. Authorizes educational classes for HOA board members.
5. Requires Commissioner approval of new and amended governing documents, and review of CC&Rs.
6. Commissioner can
   • adopt rules in accordance with Chapter 20,
   • Investigate and enforce compliance,
   • Enforce any ordered restitution by developer or HOA (to compensate homeowner for monetary loss and damages),
   • Appoint a receiver to manage the HOA,
   • Require HOA cooperation with investigation,
   • Institute legal action against persons destroying, concealing or removing corporate records,
   • Create standards for meaningful penalties for violations (similar to existing public requirements).
7. Creation of an ADHOA advisory board of HOA members only to provide recommendations to the Commissioner.
8. Sets filing fees based on current Justice Court filing fees, currently only $86.

 

References

[1] “Community Associations Continue National Growth,” October 19, 2017 News Release.

[2] See Benito Mussolini: What is Fascism, 1932.

[3] “Fundamental Ideas of Fascism,” Benito Mussolini, Souciant, Inc.

[4] See my Advisory, Arizona’s new “Take That George!” law: officials don’t have to defend HOA statutes.

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

[6] HOA regulatory agency bill-rev.pdf

[7] See my Advisory, Justifications for an independent HOA regulatory agency.

[8] New wording is designated in blue CAPS; removed wording will have a strikethrough.  All other wording is unchanged wording that must be included even if one word is changed in a lengthy amended section.