Tag: CC&Rs

CAI continues to ignore the Constitution for the HOA constitution

CAI continues its stand against HOAs being held to the US and state constitutions.  This is a second case, the first being CBTR v. Twin Rivers, 929 A.2d 1060 (2007). Sort of an argument for secession to an independent principality status where all residents would be regarded as “expats” (expatriates).

In the Twin Rivers case, the CAI amicus brief to the NJ appellate court warned about “the unwise extension of constitutional rights to the use of private property by members [in HOAs].”

Here’s what CAI had to say in this more recent NJ case, 4 years later. Note that it’s a “putative” brief. Aside for being paid by a party, not indicated here, a putative amicus brief can bring up arguments not raised by the parties for the “edification” of the court. This appears to be CAI – NJ’s position.

Excerpts from the “Putative Amicus Curiae Brief” by CAI – NJ to NJ Supreme Court, July 27, 2011

Whatever rights common interest association members have to express themselves regarding association issues arise not from the State Constitution but rather from statute, from contractual provisions of the association’s governing documents, from the fiduciary duty owed by the association trustees, and from concepts of fundamental fairness.

The ability of members to communicate with each other thus may be said to be an implied covenant in the By-Laws, a fiduciary obligation of the organization, and/or due to fundamental fairness to enable members to participate in community affairs and governance.

A governing board’s regulations are enforceable only if they satisfy the business judgment rule, that is, they are authorized by statute or the governing documents and the board’s action is not fraudulent, self-dealing or unconscionable. [citing Twin Rivers].

Because the unit owners have other statutory, contractual and legal remedies to protect them from overreaching by the Association, there is no need to apply the constitutional free speech clause. For that reason as well, the appellate majority opinion should be reversed.

Mazdabrook Commons v. Kahn, No. 67,094, (NJ 2011) (Not yet decided).

In other words, who needs the Constitution? We have our top-down, business profiteer’s CC&Rs private contract, and laws that mimic and are almost identical to the CC&Rs. Who needs the NJ Constitution, too.

See Twin Rivers and NJ HOA free speech rights, redux.

Good night and very good luck – the unspoken media HOA alliance

I hope that the paraphrased quote of, “Good Night and Good Luck,” the signoff by the renowned Edward R. Murrow, who was the only journalist to openly oppose the commie scare by Sen. McCarthy in the 50s, is recognized by the news media. The media of today, especially the local news media, the young and laughing personalities of the 5:00 PM news seem to be totally oblivious to important HOA bills before state legislatures. Bills that would affect some 20% of the people in across the country.

Why? It seems that they prefer to see no evil, hear no evil, speak no evil about HOAs. Or is it really corporate media making the call?

Murrow, upon leaving the CBS network in 1953 had this to say about the TV news media.

Our history will be what we make it. And if there are any historians about fifty or a hundred years from now . . . they will there find . . . evidence of decadence, escapism and insulation from the realities of the world in which we live. I invite your attention to the television schedules of all networks between the hours of 8 and 11 p.m., Eastern Time.

We are currently wealthy, fat, comfortable and complacent. We have currently a built-in allergy to unpleasant or disturbing information. Our mass media reflect this.

Are the big corporations who pay the freight for radio and television programs wise to use that time exclusively for the sale of goods and services? Is it in their own interest and that of the stockholders so to do?

Since this statement was made, the news has become highly editorialized and selective, geared to entertain. It appears that providing important matters of civic concern affecting their private property and community to their viewers is a secondary concern, and only such information as the media moguls deem to be appropriate. (For a brief history of Arizona’s HOA news coverage, see Arizona HOA News History).

There have been no in-depth analyses or debates of the HOA legal concept even at the national level, as the spread of HOA-Land is nationwide. The Sunday news talk shows, or by 20-20 and Dateline, are silent. There have been no discussions on whether HOAs, as de facto governments, should by made a government entity. Or whether state legislatures should continue to allow equitable servitude law to supersede contract and constitutional law. Or the lack of debate on the absence of “truth in HOAs” disclosures, similar to truth in lending and truth in advertising.

Or what is the legitimate government interest to allow private governments to deny the equal application of the laws. Or to allow constructive notice – just take your deed — to bind unsuspecting home buyers to the CC&Rs sight unseen. Apparently there is no need to inform buyers at closing of the great leap that they are taking into the unknown.

Doesn’t the news media understand, haven’t they been taught in journalism 101, that silence carries an acceptance of conditions and events. With no opposing views, what do they think their viewers will accept and believe. Obviously, “No news is good news.” And this silence has helped generate the national groupthink that “HOAs are the next best thing to Mom’s apple pie.” This silence helps generate an inbreeding, a closed group without outside reality testing for verification. (See the seminal work by Irving Janis, Victims of Groupthink, 1972).

Here’s what the activist group, Psychologists for Social Responsibility (PsySR), has to say about groupthink (my emphasis).

A group is especially vulnerable to groupthink when its members are similar in background, when the group is insulated from outside opinions, and when there are no clear rules for decision making. Groupthink occurs when groups are highly cohesive and when they are under considerable pressure . . . . When pressures for unanimity seem overwhelming, members are less motivated to realistically appraise the alternative courses of action available to them. These group pressures lead to carelessness and irrational thinking since groups experiencing groupthink fail to consider all alternatives and seek to maintain unanimity. Decisions shaped by groupthink have low probability of achieving successful outcomes.

And PsySR finds fault with the media for failing to inform its viewers about the alternative views of others.

Knowledge is power and we as citizens and as a nation are becoming less powerful. The American press, especially the television news media, has let down the American people and the American people have allowed this to happen. US television news is geared more toward providing entertainment than information.

We can now answer why this silence, why this unspoken alliance of no negatives about HOAs. The history of the media’s role with respect to substantive issues on HOA constitutionality, and other legalities, has gone through four stages: 1) repeat what the special interests have to say, 2) allow advocates to speak out in opposition, 3) report only favorable stories, and 4) withdrawal from the controversy. (See Arizona HOA News History).

The reason for this withdrawal by the media can be found in their realization that the HOA legal concept cannot be defended without renouncing the US Constitution and our system of democratic government. In short, any such attempt would be Defending the Indefensible. So, silence is the only option if one truly believes, in spite of the overwhelming evidence, that HOAs are better than Mom’s apple pie.

With that I say, “Good night and good luck.”   Those of you living in HOAs surely need lots of it.

AZ House supports HOA dominance over municipalities

In an unbelievable acquiescence to the secession of legitimate public government control to private government HOAs, this bill, SB 1113, regulating public streets within HOA subdivisions,  was soundly rejected by the House Judicial Committee. Welcome to the New America of HOA-Land brought to you by your elected representatives who take an oath to uphold the Arizona and US Constitutions.  The bill was defeated 2 – 6.

The only worthwhile commentary was from the Chair, Rep. Eddie Farnsworth, who concluded with, “I find it disturbing that this committee rejected this bill because the police says its too difficult to enforce.”  Nationally known Sheriff Joe Arpaio was against the bill.  Farnworth also remarked that the political realities of the 2,000 member exclusion amendment was needed because of the “highly paid lobbyists like the one you see before you,” referring to CAI lobbyist DeMenna.

And still, there are those who truly believe that the Constitution is only about the absolute right of HOAs to write contracts that supersede the Constitution.

I am continually amazed that some legislators still use this as an excuse to stop bills that seek to reign in lawless conduct by HOA boards.   Legislators who do not want to hold boards accountable under the laws of the land are condoning HOAs as above the laws of Arizona, above the Arizona and US Constitutions.  Surely they must realize this.  Surely they do not realize the consequences of this unexplainable position on HOAs.

The failure of the Judiciary Committee to pass this very important bill to prevent private entities from usurping legitimate government functions is very disturbing.  The purpose of a committee is to recommend a bill for the entire body to consider, and not to kill such an important bill and thereby not giving all the elected representatives  their due voice.   This is politics under the influence of special interests.

If the HOA boards and officers refuse to join our democratic society, then they should be allowed to fail!  It is unconscionable to do otherwise!  If this is too much for some people, that their “free ride” is over, well, then they can just move out!

Once, long ago, America had people of character, of integrity and of honor.  Now, it’s just “what’s in it for me” and “how will it affect my legacy” — self-centered concern about themselves and not about their responbilities and duties as public servants for the people.  The people have the right to expect that their elected representatives would protect their rights and freedoms under the Constitution, and not to support the unconstitutional delegation of legislative powers to private entities.

AZ HB 2160, HOA elections reform, provides misdemeanor penalties

One of the most needed bills for enforcement to protect the rights of homeowners in HOAs is Arizona’s HB 2160, which passed the House and goes on to the Senate.  This bill makes “A corporation or other entity that intentionally violates subsection [ ] of this section is guilty of a class 1 misdemeanor.”

In a subculture where legalized extortion goes unpunished, and where recourse to democratic election processes to elect and replace corrupt government “officials” are woefully inadequate, the Arizona Legislature is finally putting its foot down on such acts against public policy. HOAs hide behind the fact that they are private contracts and are not bound by constitutional protections while proclaiming how HOAs are a great town hall democratic institution.

However, the newly elected President-elect of CAI’s College of Community Association Lawyers, Arizona’s Scott Carpenter, protests this bill: “Where is the evidence that voting ballots should have a cloud of criminal prosecution having over it? Criminalizing the counting of homeowners association and condominium association ballots should outrage Arizona’s citizens.” (Criminalization of HOA Elections).

Why should citizens be outraged? While complaining about no justification to hold violators accountable, Carpenter offers know valid reason not to.  Perhaps the newly elected President-Elect doesn’t understand the difference between criminal and civil law. Let me explain.

Civil law is in regard to disputes between two parties, like a contractual dispute. Criminal law, on the other hand, are violations against the state and its laws. Nothing new, nothing different. It is there to “protect society . . . from those forces that most threaten the peace, the harmony . . . and society as a whole.” It is there to deter and to punish.

This bill is an affirmation that the violations of state laws by HOA boards and officers, and their agents, are contrary to the good of the greater society and must cease. The bill says that HOAs are no longer independent principalities doing as they wish without fears of liability for wrongful acts. If this is too much for some people, that their “free ride” is over, well, then they can just move out! But, the American system of government that treats all people equal and applies the law equally, and that now applies to HOAs, cannot continue to tolerate this separation from constitutional government.

It is the gross and prolonged failure of the industry to police itself in the midst of such abuse that has caused the legislature to act. It is the gross and prolonged failure of the “national HOA educator” organization with all their attorney lobbyists to work in support of, and not in opposition to, these bills that protect society as a whole that has caused the legislature to act.

A Class 1 Misdemeanor is an offense that carries up to 6 months in jail (ARS 13-707(A)(1)), and up to $2,500 in fines (ARS 13-802(A)). Neither are mandatory. However, a fine for a misdemeanor committed by an enterprise is up to $20,000 (ARS 13-803(A)), but is not mandatory either.

The legislature does no wrong when enacting HOA laws, or does it?

Where have you gone, Joe DiMaggio

A nation turns its lonely eyes to you.

What’s that you say, Mrs. Robinson

Joltin’ Joe has left and gone away.

(Hey, hey, hey . . . hey, hey, hey)

 

(from the song, Mrs. Robinson, Simon & Garfunkel, 1967)

Franklin Delano Roosevelt recognized that a country in crisis needs to confront the illusions that led it astray and return to the values that can form a firmer foundation.

(Rediscovering Values On Wall Street, Main Street and Your Street, Jim Wallis, 2010)

 

As many state legislatures are now dealing with HOA reform legislation, I examine the question of unconstitutional bills being made law, and the failure of legislators to understand their acts under the “due process of law” restrictions of the 5th and 14th Amendments.  Essentially, the legislature cannot enact laws that favor one group over another without an explicit, valid justification for such laws. The legislature must cease protecting HOAs at the expense of the rights and freedoms of its citizens who live under these regimes.

Looking at our current condition in every state with HOA “Acts”, we must understand that, conforming to the historical pattern for civilizations and nations, the US is on the downside of its “life-cycle.”   The people, and their elected representatives, have forgotten its reasons-for-being — the values, principles and beliefs that founded this experiment in representative democracy.   We have become a nation under the rule of man, not law, as well demonstrated by  our concern for who gets  to be the next US Supreme Court Justice, the next person to determine and to make law.

As formerly held with respect to kings and emperors of long along, we have returned to the notion that the legislature can do no wrong and is above reproach, as well demonstrated by the legal doctrine that all laws are presumed to be constitutional.  The oversight by the courts is a myth in reality, because a strong burden is placed on the people to prove beyond a doubt that the law violates the Constitution.   And the legislative Rules committees that are obligated to check the constitutionality of a bill is also a myth.  In short, we have returned to “The sovereign can do no wrong.”

Due Process of Law constraints

However, the fundamental due process of law obligations set forth in the Constitution do impose restrictions on legislative free-wheeling law making.  Essentially, “due process of law” requires not only proper procedures be followed, but the law at issue must be valid and legitimate.  To enforce a law solely as to the procedural processes would make a mockery of legitimate government, if the law to be enforced is unconstitutional itself.  This point is made quite clearly and empathetically by Timothy Sandefur (Harvard Journal of Law & Public Policy, Winter 2012, p. 337),

“One can easily imagine such a legislature enacting a statute vesting lynch mobs . . . to adjudicate and punish perceived wrongs . . . or a statute assigning automatic death penalty for such vague ‘crimes’ as being ‘uppity.’”

For those readers who believe that this statement is wholly unbelievable and unreal, it is quite close to what is occurring with HOA statutes across the country. They easily amount to special laws for special groups without a legitimate government justification and interest.  Justifications that would pass the requisite judicial scrutiny other than just “a reasonable government interest.” (The silence by the legislatures and government officials as to a legitimate government interest for HOA laws only confirms the lack of any valid justification. See Rights of Man, Thomas Paine.)

Legitimate Law Making

What then, does due process of law impose on the legitimacy  of legislature lawmaking?  Sundefur argues that, “The Due Process Clause was written to ensure that government does not act without reasons, nor for insufficient, corrupt or illusory reasons.”  (p. 287); “This obligates the government to act in a lawful manner.” (p. 290).  He defines a lawful act as “a use of the state’s coercive powers in the service of some general rule that realistically serves a public, not a private end” (my emphasis), and is “a prohibition against government acting in an arbitrary way.” 

In other words, where there is no rational purpose or explanation for the law, as we see with many HOA laws, the law is not legitimate.

“Legislation that singles out a particular business . . . for no legitimate reason or uses irrelevant distinctions as an excuse for treating people differently . . . exercises government power in an arbitrary way.” (p.308).

We are well aware that many statutes deny homeowners rights that they would otherwise enjoy if they were living outside the HOA regime.  (I will skip the arguments concerning a valid contract under contract law, the lack of genuine consent, and the superiority of servitudes law over constitutional and contract laws that allows for the surrender of rights and freedoms under these conditions.)  We know that many HOA statutes can be seen as punitive, such as foreclosure rights; fines without proper due process; granting of “open” liens; allowing HOA fines to accumulate while adjudication of a dispute begins or is occurring; and the mandate that assessments be paid regardless of any dispute with the HOA.

 Sandefur argues that statutes of this type that “burden a group for no other reason than that the victims exercise too little political influence to defend themselves . . . are more like  punishments than law,” and maintains that “Legislation of this sort is arbitrary, based on no other principle except the ipse dixit of force.”  That is, Sandefur is saying, by the mere pronouncement or enactment by the legislature without any justification of supporting arguments – an ipse dixit – the legislature is commanding obedience to the law.

 

If angels were to govern men

Allow me to address the question of why. Why is this happening, especially with HOA statutes?  First, we have forgotten that the structuring of government was based on the realities of human nature, and not on some idealized standard of behavior that the people must strive to attain.  (This level of behavior, for example, would be the unrealistic demand that if HOA members would only get involved in HOA government all problems would go away.)

Second, as Madison wrote, “If angels were to govern men, neither external nor internal controls on government would be necessary.”   The “presumption of constitutionality” doctrine stands in contradiction to the realities of this country and the structuring of government.  It allows the legislators, like HOA boards, to be unaccountable for their acts in passing all sorts of laws without regard to the restrictions of the due process of laws clause.   It is just another example of Sandefur’s argument that ipse dixit laws go unchecked because the people have too little political influence. 

As an aside, as I now write,  Arizona’s HCR 2104 would require every bill  to state the authority under the Arizona Constitution that would  allow this legislative action.  Sadly though, the bill was not meant to go anywhere as it is a “vehicle” or placeholder bill.  It has been sitting, not even heard, in the Judiciary  Committee, and the session ends in April.

And the worst due process of law offense of all is for the legislatures and courts to stand aside and allow these de facto, authoritarian governments to exist outside the social contract known as the Constitution of the United States of America.