Tag: AARP

UCIOA (HOA) revisions in the works

The Uniform Common Interest Ownership Act (UCIOA) and Uniform Condominium Act (UCA) are currently in draft mode. (Essentially, they are being treated as one). As a model for states to adopt as their HOA laws, UCIOA was first introduced in 1982 and currently has 9 states adopting some version of UCIOA and some 14 states adopting UCA, the uniform condo act.

Among the changes being considered are amendments to governing documents (§1-206), owners and duties of the association (§3-102), executive board members and officers (§3-103), voting and ballots (§3-110), and assessments (§3-115).

A meeting of the drafting committee will be held this Friday and Saturday, April 3 & 4. The committee consists of lawyers generally appointed by their state Governor. Invited to attend are persons who have indicated an interest in the workings of the committee, designated as Observers. Observers are expected to contribute to the discussion of the issues and can submit amendments for consideration. Sort of like a citizen submitting a proposed bill to his legislator.

Not to be surprised, former CAI president and active NJ CAI member David Ramsey is an Observer.

In 2008, in response to David Kahne’s AARP paper on HOA member rights and the works of others including political scientists, a Member Bill of Rights was adopted as a separate add-on to UCIOA. It never took off. And still the ULC (Uniform Law Commission) has not revisited constitutional protections for members in spite of several bills advancing those rights in 3 states.

Read more about the objectives and purpose of ULC.

Resurrecting the argument for a homeowners bill of rights

This demand for a homeowners bill of rights by homeowner rights advocates had its play back in the 1997 – 2008 period, some 10 years ago. There was:

  • the AHRC’s 1997 bill,[1]
  • Lois and Samuel Pratt’s 1999 bill,[2]
  • my 2000 address to the AZ Legislature[3],
  • the 2006 AARP bill of rights,[4]
  • and my 2008 “Members Bill of Rights” amendment to CLRC.[5]

And there are undoubtedly others that I missed. Deborah Goonan recently re-posted a 2015 article[6] speaking of no Bill of Rights and constitutional violations of the 14th Amendment.  In 2017 the California Legislature adopted a limited bill of rights dealing with member political free speech.[7]

A new look at homeowner rights is needed, one that takes a down-to-earth approach and focuses on the common CC&Rs covenants and bylaws that read like,

  1. If there are conflicts between the provisions of Arizona law, the Articles, the Declaration, and these By-Laws, the provisions of Arizona law, the Articles, and the By-Laws (in that order) shall prevail.
  2. these By-Laws [Declaration] may be amended only by the affirmative vote or written consent, or any combination thereof of Members representing at least 51% [67%] of the . . . votes in the Association.
  3. no amendment may remove, revoke, or modify any right or privilege of Declarant . . . without the written consent of Declarant

Over the years I’ve discovered that the courts have universally upheld the broad amendment covenant as generically stated in (2) above.  The basis of their decisions is the very dangerous and overly broad interpretation that homeowners agreed to be bound[8] by the CC&Rs and bylaws.   Note that (3) above carves out an exception for the Declarant that requires his explicit consent, while accepting the majority rule principle in regard to the members. But, this “acceptance” to be bound by majority rule violates a fundamental right of citizens in regard a governmental “taking” or eminent domain action.

In many instances the courts have required 100% consent when the amendment adds new covenants, covenants not found in the CC&Rs, the most notable being changing from a voluntary HOA to a mandatory HOA.  This would be inconsistent with (1) above that holds that the law of the land prevails, and which of course, the buyer also agreed to. But, CAI comes to the rescue and prevails in the courts that the CC&Rs and bylaws contain valid waivers and surrenders of fundamental rights, even to the extent of accepting implicit (not stated but presumed consent) waivers and surrenders as valid.

Hold on! It is long held legal doctrine that the surrender and waiver of these rights must be explicit, one by one. And that, under contract law, there must be a meeting of the minds with full consent and no misrepresentation in the buying process. I have concluded that,

Public policy today rejects constitutional government for HOAs allowing them to operate outside the law of the land. 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.

The point I wish to make is that the absence of any meaningful bill of rights that genuinely protects the rights of HOA members is ab initio (from the beginning) a rejection of democratic norms and institutions.  The HOA cannot, therefore, be considered democratic by any means regardless of the propaganda by CAI and other pro-HOA supporters.

Community associations are not governments — many years of legislation and court rulings have established that fact beyond a reasonable doubt. Yet they are clearly democratic in their operations, electing their leadership from among the homeowners on a periodic basis.

. . . .

The solution to that problem is not to replace democracy with tyranny, royalty, or some other form of government, but to work to make the democratic process better and to hold those elected accountable.[9]

Simply unbelievable!  (In face of subsequent advocate criticisms, CAI began speaking of HOAs as a business, and we are seeing more and more statements that when a homebuyer signed his real estate contract, he was actually investing in a business.  Unbelievable!  Shades of George Orwell’s NewSpeak from his novel, 1984, where people are indoctrinated to hold 2 opposing views at the same time, and be at peace.)

What is intentionally absent — yes, intentionally otherwise the renowned CAI layers would have to claim incompetency regarding the law – is a Homeowners Bill of Rights.  Can you imagine that if the HOA framers, those stakeholders, of the HOA concept had actually met and discussed with knowledgeable and informed public that there would be protections for homeowners?  Can you imagine?

What the absent, yet informed public, would have added was a Preamble to an Amendment to the CC&R that would have been like that found in the Bill of Rights:

 Preamble to the US Bill of Rights

“THE Conventions of a number of States, having at the time of adopting the Constitution, expressed a desire, in order to prevent misconstruction or abuse of its powers, that further declaratory and restrictive clauses should be added: And as extending the ground of public confidence in the Government, will best insure the beneficent ends of its institution:”

The basis for the BOR was a distrust of government and the need to further protect the people.  Regarding the HOA documents, the 9th and 10th Amendments, as applied to the HOA legal scheme, would prevent the broad interpretations that have been and are continuing being held by the courts.  No more generalities, except in favor of the members.  If it was good for America over 230 years, it must be good for HOA-Land!

Amendment IX

The enumeration in the Constitution, of certain rights, shall not be construed to deny or disparage others retained by the people.

Amendment X

The powers not delegated to the United States by the Constitution, nor prohibited by it to the states, are reserved to the states respectively, or to the people.

The 9th Amendment simply says that if it ain’t specified – enumerated — in the governing documents, it belongs to the membership.  No more broad interpretations of waivers and surrenders of rights.  The 10th Amendment simply says that if the members did not explicitly agree to certain HOA powers (delegated to), it belongs to the membership.

This is the argument and approach needed to get a Homeowners Bill of Rights accepted by state legislatures.  It should be a national campaign by all advocate groups in all states for their next legislative session.  There is time to organize and prepare.

 

References

[1] See “Short History” in co-opting the HOA “homeowners bill of rights”, Elizabeth McMahon, 1997.

[2] See A BILL OF RIGHTS FOR HOMEOWNERS IN RESIDENTIAL COMMUNITY ASSOCIATIONS (1999).

[3] Statement to AZ Legislative Homeowners Association Study Committee, 2000.

[4] A Bill of Rights for Homeowners in Associations, AARP HOA Bill of Rights, David Kahne 2006.

[5] Supra, n. 1. “CLRC” is the California Law Review Commission.

[6] Let’s Get Some National Attention on HOA, Housing Issues, Deborah Goonan, 2015 original post.  

[7] A California true HOA Bill of Rights (SB 407).

[8] For a summary of the issues regarding the agreement to be bound position, see “Consent to be governed, No. 4”, HOA Common Sense: rejecting private government.  The notes contain very important authorities on this issue.  (In only one case did a court reject this position because it felt that the amendment exceeded the reasonable expectations of the homeowner.  For example, having part of their assessments go toward a private entity unrelated to the HOA).

[9] CAI CEO Skiba in his April 2, 2008 Ungated blog entry.

Do state HOA Statutes Establish HOAs as State Actors?

Do state laws coerce homeowners and support HOAs? Are UCIOA and other HOA statutes establishing state actors?

The New Jersey Supreme Court appears to headed for a decision soon on constitutional issues for homeowner rights — the Twin Rivers case. Steven Siegel, whose very important paper on constitutionality and private governments is referenced in Note 1, has also co-authored the Twin Rivers AARP amicus curiae brief for the homeowners.

The US Supreme Court has stated criteria for state actors/actions beyond the antiquated “public functions” test based on the 1946 company town model. In my view, many state statutes easily satisfy one or more of these criteria and clearly establish HOAs as state actors.

 

Our cases have identified a host of facts that can bear on the fairness of such an attribution. We have, for example, held that a challenged activity may be state action when it results from the State’s exercise of “coercive power,” Blum, 457 U.S., at 1004, 102 S.Ct. 2777, when the State provides “significant encouragement, either overt or covert,” ibid., or when a private actor operates as a “willful participant in joint activity with the State or its agents,” Lugar, supra, at 941, 102 S.Ct. 2744 (internal quotation marks omitted). We have treated a nominally private entity as a state actor when it is controlled by an “agency of the State,” Pennsylvania v. Board of Directors of City Trusts of Philadelphia, 353 U.S. 230, 231, 77 S.Ct. 806, 1 L.Ed.2d 792 (1957) (per curiam), when it has been delegated a public function by the State, cf., e.g., West v. Atkins, supra, at 56, 108 S.Ct. 2250; Edmonson v. Leesville Concrete Co., 500 U.S. 614, 627-628, 111 S.Ct. 2077, 114 L.Ed.2d 660 (1991), when it is “entwined with governmental policies,” or when government is “entwined in [its] management or control,” Evans v. Newton, 382 U.S. 296, 299, 301, 86 S.Ct. 486, 15 L.Ed.2d 373 (1966). (See note 1).

I believe that many elements of state laws can be shown to create HOAs state actors. Many phrases in law are simple pro-active statements, such as the words “constitute” or “create”, as in “acceptance of the deed constitutes acceptance of the CC&Rs” or “creates a lien on the property as of the date the assessment is due”. In other phrases we run into the issue of state mandates. For example, the word “shall” in statutes is interpreted to mean “must”, and the word “may” does not constitute a command or order, but a just an option. Therefore, it has been argued, a statute is not a legislative mandate if it contains the word “may” rather than “shall”, as many HOA statutes contain.

But, let’s examine this a little more closely. The state has the right under its police powers to regulate our activities, but it must justify its interference as a legitimate government interest. And the tests for “legitimate government interest” become more severe as the state attempts to take away our fundamental rights. For example, the state restriction on our rights must not be one of convenience for them, but of necessity because the state’s objective could not otherwise be accomplished. I have not seen any such justifications in any state HOA Acts or statutes, not even in the various UCIOAs.

If the law is silent on an issue, the legality of the issue is open for a decision. If the law says “shall” or makes what I referred to as a “simple pro-active statement”, then the answer has been given quite clearly. If the statute says “may not”, then it is also quite clear. Now, if it says “may”, isn’t this a legalization of the act and a permission for a person to act in such a manner? While it is not the same as a mandate by the state, isn’t it a legalization of the act? And as such, isn’t the state “sanctioning” the act, which can be viewed as state support for the action, such as fining a homeowner without providing proper due process protections by independent tribunals? Otherwise, if the state disapproved or did not support the action, the statute would have read “may not”. But, it said. “may”.

I argue that all these “mays” are a clear indication of state support, encouragement and coercion in favor of HOAs that deny homeowners their fundamental rights, and make HOAs state actors.

1. Brentwood Academy v. Tennessee Secondary School Athletic Ass’n, 531 U.S. 288 296 (2001). (See generally, Steven Siegel, The Constitution and Private Government: Toward the Recognition of Constitutional Rights in Private Residential Communities Fifty years After Marsh v. Alabama, Wm & Mary Bill of Rights J., Vol. 6, Issue 2 (1998)).