Tag: CAI

Is there a CAI game plan to rewrite HOA CC&Rs to restrict member voting powers?

It appears to me that the 2012 CAI game plan is to completely rewrite the CC&Rs. This makes it about 1/2 dozen cases that I’ve heard in the past 6 months, and all seem to restrict the powers of the homeowner by not allowing homeowners to vote on important issues.

As an example, the current LA Times HOA column by Donie Vanitzian, “Homeowner association can’t adopt new bylaws without owners’ OK”,  deals with a question of a rewrite of the CC&Rs with provisions to exclude homeowner voting on certain issues involving IRS overpayments. This excellent article touches upon a serious move by  attorneys to further entrench the board of directors as a dictatorship. BEWARE!

One malicious rewrite is to permit minority voting control for assessments, amendments to the CC&Rs, and taking on outside loans/debt (CAI attorney). Minority control comes in the form of, for example as such a bill mandating minority rule was defeated in Arizona last year, a 2/3 vote of those in attendance with a 50% quorum, which gives 1 /3 vote to approve issues. (CAI attorney sponsored).

Now, they are going directly to the members who are well known to be apathetic and there’s a very good chance that they will sign on without even reading the details. One rewrite includes a 50% reduction in the quorum until a quorum is met, which would allow the political machine to adjourn the meeting and recall it every 5 minutes until they win. A second method, as I just witnessed, is to permit a 2/3 vote of the board to settle matters in the event that a quorum is not attained at the second meeting. (CAI attorneys).

In Arizona, SB 1476 would put a stop to CC&Rs that ignore member voting on CC&Rs amendments, and other restrictions on board acts to quash democracy in HOAs.. Minority rule, especially with the well know abuse by HOAs, is a very dangerous power as it would allow the political machine, the clique in power, to completely alter the CC&Rs o completely ignore any voting by the members, even to allowing future directors to be appointed by a “select” committee of current board members. And all would be legal, according to numerous court decisions, so long as the procedures specified in the CC&Rs are followed. Period!

What we are seeing here is CAI attorneys acting to promote seditious acts that undermine our Constitution and democratic society with its basic principal of majority control.

What we are seeing here is CAI creating and establishing HOA fascist governments where the HOA state objectives are first and foremost — to support the HOA corporation aided and abetted by corporate interests – the attorneys and management firms, the “hired hands.” The second part of the fascist form of government, in order for it to succeed, is the need to suppress individual rights and freedoms as we see with HOAs, and as we heard from CAI, “the unwise extension of constitutional rights to the use of private property by members . . .” (CAI amicus brief to NJ appellate court in Twin Rivers).

WAKE UP HOMEOWNERS! WAKE UP! YOUR PRIVATE PROPERTY HOME IN AN HOA IS A MYTH, AND ALL YOU OWN IN YOUR HOME IS THE RIGHT TO MAKE HOA ASSESSMENT PAYMENTS.

The ‘voice of the people’ must muster against the Constitution – including HOAs

The Ninth Circuit Court of Appeals (CA plus) rejection of the voice of the people, Proposition 8, same sex marriage, demonstrates that acts and votes by the people must stand muster against the Constitution. And that was a majority voice. “By using their initiative power to target a minority group and withdraw a right that it possessed, without a legitimate reason for doing so, the People of California violated the Equal Protection Clause,” [Judge] Reinhardt said.

CAI— the national, pro-HOA lobbying trade group — and other pro-HOA stalwarts have repeatedly argued that the voice of the people, the members of an HOA, under a private agreement, expressing the alleged voice of the people because they live there, should prevail regardless of the Constitution. Their rationalization is, “better landscaping makes a better America.”

In effect, they ignore and reject the Constitution. In effect they argue for, encourage, promote and incite sedition against the lawful and legitimate government of this country and the states.

The government cannot meet the strict judicial scrutiny for the surrender of private property rights in order to allow current statutes to remain.  Our government cannot claim, “I didn’t know.”  There is no legitimate justification for the denial of the equal application of the laws and due process protections for citizens living in an HOA. Unless, of course, for national security reasons to protect against terrorism.

Arizona Senators debate HOA legal status

 The Voice of Times Past  and the Voice of Times Present

 

A lengthy exchange, exemplifying  the polarized views of the HOA legal concept occurred between two committee members  during the Senate VMGA Committee hearing on SB 1113, control of public roadways  (Jan. 31, 2012).  I refer to the two Senators as the Voice of Times Past and the Voice of Times Present.

Senator  John Nelson, Times Past,  speaks from the past and echoes the pro-HOA themes of maintaining property values, of freedom of contract, and unquestioned consent to agree  and full compliance with contract law.  His position speaks in favor of HOAs as independent principalities above all other laws of the land, holding that private parties can contract to avoid the Constitution and laws of the land.

I do not mean to be disrespectful,   as the Senator appears to truly believe in his position — and we all are entitled to our beliefs — yet he  has not realized the implications of his beliefs on his duties and obligations as a state senator.   He has  failed to address the consequences and impact on society of such beliefs, which have become  ingrained and dogmatic over the many years

Senator Frank Antenori, Times Present, speaks of constitutional infringements by the HOA legal concept and of violations  of our principles of democratic government by de facto  private entities unaccountable under the Constitution. These issues were  also raised by the bill sponsor, Senator Nancy Barto. 

What is apparent in this exchange is that to resolve the alleged safety issues on street parking, the HOA simply refuses to make use of the legal vehicle of seeking planning board variations, thus making this a political power issue between public government and private HOA principalities.  Furthermore, putting “we can contract to do anything we want,” even to ignore the laws of the land, is an absurdity too often used by those seeking unrestrained power, and too  often irresponsibly thrown about.  Case law has repeatedly rejected any such unqualified authority. 

(It should be noted that CAI did not speak at this hearing, and it’s member blog did not address constitutional issues of de facto private governments seeking special treatment above the laws of the land).

What  the Voice of Times Yet To Come  will have to say depends on what occurs today, in Arizona, and  in all state legislatures across the country.   Will the 200 plus year American experiment in democratic government be extinguished by a successful second, 48 year American experiment in private, authoritarian government functioning  under fascist principles?

The bill squeaked by and was passed by a 4 – 3 vote.

 The complete public video of the hearing can be found in the Arizona Legislature video archives for that hearing (click here).   Jump to 39:00 minutes for the 30 minute exchange.  After viewing the video, you will better understand how HOAs have become a second political government at the local level, and what legislative obstacles lay in the way to susbstantive HOA reform legislation. 

At about the same time as this Arizona debate, an NPR radio talk show took place  in Charlotte, NC (WFAE,  Charlotte Talks, Mike Collins, host)  that also addressed the good, the bad and the ugly of HOAs.  It is well worth listening too, as it also addresses public policy concerns. The link can be found at the  North Carolina Coalition for Homeowners Rights website.

See also, 

1.  Evan McKenzie’s Privatopia Papers contribution to the constitutional issues debate, HOA debate: illegitimate government and invalid CC&Rs contract.

2.  HOA-Land — the failure to democratize.

Statement to NC Select HOA Committee

January 17, 2012

Mr. Ed Stiles
Committee Assistant
NC House Select Committee on HOAs
 
email statement

Statement to the NC House Select Committee on HOAs

January 23, 2012 Meeting

Dear Committee Members,

I am submitting this email statement for inclusion into the record for the January 23, 2012 hearing on homeowners associations. I am a nationally recognized homeowner rights advocate who believes in “supporting principles of democratic government.”

Over my 13 years of involvement in HOA reform legislation across this country, I have witnessed a slow, but steady, change in the perception of homeowner associations from “the next best thing to Mom’s apple pie” to the realization of that there are “worts” all over the HOA legal concept and statutes. The reason for this has been the extensive use of the internet by advocates, and the inability of the pro-HOA forces and national lobbyists in every state to stifle their voices. For over 48 years, since the introduction of the “HOA “bible”, the Homes Association Handbook, these forces held sway and shaped the attitudes of the public, the media, the policy makers, and state legislators. They exclaimed the virtues and benefits of the HOA scheme, and hid the worts, the serious defects, among the most egregious being the denial that HOAs are authoritarian, private, de facto governments that function as independent principalities. As such, HOAs are illegitimate local governments.

I am not rejecting the freedom of choice, if indeed that is a fact, in selecting the perceived benefits of a planned community by buyers, but the mass merchandising of these HOAs under highly questionable sales and advertising methods – misrepresentation, fraud, half-truths, false truths. As an example, no state has adopted anything close to the “Truth in HOAs Disclosure Agreement” that serves as a notice and warning of what HOA life is really about. (See, Appendix A, Model Consent to be Governed Disclosure Bill). I am not objecting to that real estate “package” of benefits, but to the form and nature of the governing body of the subdivision, commonly known as the Homeowners Association, and the adhesive CC&Rs “contract” that denies constitutional protections of due process and the equal application of the law.

HOAs are unaccountable to the state government. The statutes are unconstitutional special laws for special organizations, that reject contract law and constitutional law for the common law of equitable servitudes. As long-time advocate Evan McKenzie wrote in Privatopia (1994),

In a variety of ways, these private governments are illiberal and undemocratic. Most significantly boards of directors operate outside constitutional restrictions because the law views them as business entities rather than governments. . . . [They] are inconsistent not only with political theories of legitimacy but with the normal process by which governments are created. . . . Thus these ‘private governments’ may violate the equal protection clause of the Fourteenth Amendment. (Chapter 6).

There is no justification for the non-application of the laws of the land, and the denial of fundamental rights, freedoms, privileges and immunities for homeowners with such weak arguments as: “better landscapes make better communities,” or the shifting of residential development costs from the local municipality to the homeowners, or “they agreed to be bound.” The last of which is a mockery of justice and our system of government as it allows the waiver and surrender of rights and freedoms by the mere posting of a Declaration of CC&RS to the county clerk, sight unseen by those who will be bound by the CC&Rs, by a profit seeking developer adhesion contract.

This Committee has the opportunity to begin to set things right, to restore this country to “one nation, under God, indivisible, with liberty and justice for all,” and to remove this second form of local government that has seceded from and rejects the Constitution. The Committee will hear from HOA supporters and from self-interest groups who should, by this time, understand that they, too, are rejecting the Constitution and the principles of democratic government. And more importantly, it will hear “petitions for redress” from homeowners. Do not fail the citizens of North Carolina. Do not cause them to have to say, “Our repeated petitions have been answered only by repeated injury.”

I ask that the Committee to do justice by paying heed to those petitions by homeowners and taking on the long overdue HOA reforms being asked.

My HOA profile, Appendix B, is provided for your convenience.

Respectfully submitted,

George K. Staropoli
President
 

Can substantive HOA reform legislation happen?

The intrinsic, systemic defects of the HOA legal scheme and concept severely put a dent in any attempt to obtain a just and fair HOA government. A legitimate HOA government — “legitimacy” with respect to governance — requires fair and just laws, and the fair and just enforcement of those laws. Today, the laws are unjust and pro-HOA, and the Declaration of CC&Rs is an unconscionable adhesion contract by any standard.

As Prof. McKenzie made quite clear in Privatopia (1994), “Taken as a whole, these [HOA] powers permit the regulation of a wider range of behavior than any within the purview of a public local government.” (P. 129). So much for the argument made by homeowners in HOAs and pro-HOA supporters that they are against government interference. Apparently, more regulation and interference by HOA regimes unaccountable to state laws and state constitutions is a better deal than public government protections. I’m confused!

Please step back a moment and understand the advocate irrationality at work here. Advocates are going before the state legislatures and asking for public government protections, but claiming aloud that they do not want government interference! Am I missing something, or is this “interference” another irrational fear promoted by CAI and others? It is only the actions by your public government, under its police powers to insure domestic tranquility and to promote the general welfare, that can bring justice to homeowners in HOAs. The alternative is REVOLUTION!

Since 1992, when CAI decided to become a lobbying organization and oppose HOA reforms, CAI has controlled the playing field, yet advocates managed to achieved “token” changes from time to time. I do not say that these reforms were meaningless, but for the most part were, and are, hampered by the lack of enforcement, proper due process, fair elections statutes, etc. The structure remains oppressive.

I’ve pointed out that the Founding Fathers gave up on trying to patchwork fix the Articles of Confederation, and decided to create the entirely new Constitution of the United States of America. At least they were all basically for the new “contract,” even with the usual bickering here and there. Today, we have state legislators and a powerful national lobbying trade organization, CAI, opposed to any changes of substance to the HOA legal scheme.

I’ve also pointed out that at a meeting where the British Raj was offering token handouts for government reforms, Gandhi was adamantly opposed. The British informed Gandhi that, “India belongs to the British Empire,” to which Gandhi replied, “India belongs to the Indians.” Your homes and private property rights belong to you, the homeowner, and not to a private HOA government formed and permitted to function outside the US Constitution, making the HOA a second form of political government within this country.

There are many reasons for this state of affairs — this failure to achieve reforms of substance — that have been discussed by others elsewhere. There is the frequent attitude of advocates whose objective is actually, “Fix my HOA,” with little concern for the problems affecting all homeowners in all HOAs. Aside from these advocates, I discovered some time ago that one primary factor, and an important factor when going before state legislatures seeking reform legislation, was the belief by many that the HOA legal concept could be patchwork fixed; that almost all of the advocates and homeowners wanted their HOA to protect property values, and that they rejected hardline approaches that, through fears instilled by the opposition, they felt would “do away with” HOAs.

Prof. Fatovic wrote about homeowner acceptance of HOA restrictions in 2005,

Many home owners also insist that it is imperative to control the activities of their neighbors to maintain high property values. . . . It is also claimed that strict enforcement of the rules fosters a stable and predictable environment, which is an attractive feature to many prospective buyers seeking greater control over their environments.

In addition to these appeals to material self-interest and well-being . . . the strict enforcement of rules that curtail individual freedom is legitimate because 1) HOAs are voluntary associations formed by the consent of individuals 2) who want to maintain a particular way of life in a communal setting 3) that maximizes opportunities for participation and democratic self-government. (P. 12).

(Restricted Area: A Tocquevillean Critique of Homeowners Associations).

When going before state legislatures, most advocates in all states will continue the 20-year failed expectation that asking for token reforms will solve the problems with HOA governance. That they can “have their cake and eat it.” Time to get with it! Prof. Fatovic raised the following issues clarifying this acceptance of HOAs,

However, the history and current practice of CIDs belie this Panglossian [“all is for the best in the best of all possible worlds”] view of home owners associations. As noted above, the CC&Rs are not created by prospective homeowners in a contemporary state of nature, but by builders interested in protecting their own investments and minimizing their own costs. . . . Those who will actually reside in CIDs rarely, if ever, have an opportunity to participate in the formulation of the rules that will govern their lives. The deed restrictions are non-negotiable, take-it-or-leave-it offers. . . . There is also considerable evidence that many prospective homeowners are uninformed about the specific regulations. . . . [to which] they are “consenting.” The length of CC&Rs often deters residents from reading documents that may restrict their constitutional rights. (P. 15).

This reality, over the years, sadly, has failed to arouse state legislatures to fulfill the objectives and promises of the Declaration of Independence and US Constitution: to protect individual liberties, freedoms, privileges and immunities from government oppressions. State legislatures have ignored “one nation, with liberty and justice for all” in favor of special laws for special organizations that permit private governments to ignore and reject the US Constitution!

The very structure of the Declaration of CC&Rs and the HOA-protective laws prevent substantive reform legislation from happening! The very structure of the HOA concept must be changed with a loud outcry from homeowners. As I pointed out in the past, there are existing statutes dealing with special taxing districts that can be used, with some minor changes, to subject the HOA to the Constitution while retaining the benefits of the subdivision “real estate package” of special laws, special taxes, and special amenities for those living within the taxing district — the current HOA.  (See A proposal for the “Muni-zation” of HOAs; Stop developers from granting private government charters).

Until advocates stop being “bought off” by token reforms and come to accept the need for substantive HOA reform legislation, we can expect another 20 years of re-occurring HOA problems and increased dissatisfaction.  Advocates should keep in mind that the opposition is “defending the indefensible” and all that they must do is to push hard for substantive reforms.

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