Tag: CC&Rs

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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Send the President an email petition to hold HOAs subject to the Constitution Get your voice heard. Go to Petition.

Mr. President: require all HOAs to be subject to the Constitution

By virtue of an unconscionable adhesion private contract favoring the subdivision developer and HOA board of directors, homeowners associations are allowed to deny constitutional protections and the application of the laws of the land. Over 20% of Americans, who are homeowners living in these private governments, live at the “suffrage of the board,” with state laws that do not punish board violations of the laws or of the governing HOA documents.

The alleged “consent to agree” fails all contract law requirements, and does not pass judicial scrutiny for such a waiver or surrender of one’s freedoms, liberties, immunities and privileges as a citizen of his state or as an American citizen. The selling process is ripe with misrepresentation, half-truths, and unspoken material facts about life in an HOA. There are no fair election laws or due process procedures for a fair and just hearing as are provided by public protections.

Foreclosure rights are granted to HOAs as an intimidation and punishment vehicle, and are not found anywhere else where corporations  do not advance hard cash as do banks or mortgage companies.  The HOA does not advance hard cash! A homeowner can lose all his equity for a debt less than 10% of the value of his equity. The foreclosure process is discriminatory against those who have high equity — those who have paid their mortgages and HOA dues for a very long time. It is only from these good people that the HOA can expect to obtain any payment of its debt, provided there is sufficient equity to make a payoff.

Are we united or are there two forms of political government within this great country?  If America is to remain a united people, it is time that the US prohibits the writing of private contracts, Declarations of CC&Rs, subject to common law servitudes in order to subvert the application of the US Constitution.  It is time that these private local governments be made subject to the US Constitution and stop being treated as independent principalities.

“and justice for all” not available by HOA due process clause

The Dec. 1, 2011 Condo Issues.com blog by Tyler Berding has, as it title, the long hoped for condition sought by homeowners: “And Justice for All.”  Except the author, Steve Weil, fails to make the case that such is the condition in HOAs with their disgraceful, commonly found  due process clause: “after notice and an opportunity to be heard.” Period. Citing almost identical California law only supports the legislature’s pro-HOA authoritarian regime and its denial of fundamental protections of individual rights and liberties. Apparently he never saw the 1979 Al Pacino movie by the same title.

Weil goes on to make his “expert” legal view by citing the Aliusi v Fort Washington Golf Club case, which is not a private government HOA dispute. He speaks of 1) revealing the name of the accuser, 2) the submission of evidence, and 3) makes a good point on the details required by a proper notice, or “indictment,” of wrong-doing. He buries the principles of “and justice for all” in his discussion of issues 1 and 2 above, but, reading between the lines, agrees with the right to confront witnesses and to see and challenge the evidence. Weil concludes with, “the reason for “due process” is to give one who is the target of a hearing a fair chance to defend him/herself.”

However, he makes the pro-HOA assumption, an ipse dixit, that the board, the “jury”, is indeed interested in justice, for if it truly were, it would establish an independent tribunal for hearings. “Giving the owner this opportunity helps reveal the real and relevant facts and thus also aids the board’s decision-making process.”

Finally, the author well understands the moral and ethical aspect of legitimate government and laws. He ends with the need for homeowner acceptance of HOA justice with, “an owner who feels they were given a “fair shake” is much more likely to agree with the board’s disciplinary decision and comply with the governing documents.” It is a long established doctrine, going back to the Greek philosophers, that the legitimacy of government depends on fair and just laws, and the fair and just enforcement of these laws. It is well established that HOA private governments are unjust and authoritarian in structure with a façade of democracy — just because a member can vote does not make an entity a democracy.

There are no due process protections for homeowners in HOAs that would pass judicial scrutiny. Arguments that buyers agreed to be bound to the CC&Rs and bylaws is a mockery of the facts, as the selling process is ripe with misrepresentation — false statements, half-truths, and “no negatives.” See Truth in HOAs disclosure poll — please vote your conscience.

Call for HOA action: “Occupy Wall Street” vs. Occupy the Legislature

“Occupy Wall Street”! What a way to get attention! How about an “Occupy the Legislature” demonstration against unjust and unfair HOA foreclosures with their intimidation, threats, and cruel and unusual punishment? In every state — especially Florida, Nevada, Arizona, Texas and California.

The pro-HOA supporters’ reason for the need for foreclosure rights can be found in the defective HOA legal scheme that is similar to a partnership. In partnerships there are a limited number of financial supporters, the owners, who are jointly and severally responsible for all the HOA debts — those with the money pay for those without the money. A legality. And like a privately held small business, the financial base is relatively small and limited to the homeowners who have very little practical means to escape their obligations by leaving the HOA.

Those who feel that foreclosure is needed need to ask themselves, Does the means justify the end? An “I don’t care” response is unacceptable, and legitimizes the authoritarian HOA government. Foreclosure is a special law for a special group that violates state constitutions — the equal protection of the laws, special laws for private organizations, and “color of law” constitutional violations. No state has declared its intent or purpose for the statutes – they wouldn’t dare – that justifies a legitimate government interest that can withstand judicial review of the statute. And that review is a strict review that looks to a necessary and compelling reason to deprive citizens of their rights.

And remember, there is that huge cloud hanging over the genuine and freely given, after full knowledge of all the material facts, consent to the CC&Rs. CC&Rs, a real estate doctrine based on equitable servitudes and not constitutional law, do not legally require an explicit signature or explicit surrender or waiver of constitutional rights, or for a bona fide consent to be governed by the de facto HOA political government.

Homeowners must let go of their irrational fears that the HOA would be shut down. They must stop their blind adherence to the CAI chant of “no government intervention” that really is a belief that HOA governments, unaccountable to the Constitution and state governments, are far better than public government with its police powers to protect citizens from abuse by other citizens.

An Occupy the Legislature movement is a grass roots, ground level action. It must come from local homeowners organized under local leadership, behind a fixed purpose. And right now, “Stop HOA foreclosures” is a very appropriate mission.

See HOA foreclosures:  will the real CAI stand up

In HOA-Land, Halloween is verboten!

Texas Neighborhood Tells Family to Remove Halloween Sign From Yard.

This is one very serious aspect of how HOAs have redefined the American community, not only its landscaping aesthetics, but America’s social and political customs, traditions, and system of government. And all made possible by cooperative and biased state legislatures and courts that uphold the CC&Rs as if they were a contract, yet fail to apply “Contract Law 101” to these supposedly valid contracts.

The application of contract law, and constitutional law, would immediately invalidate the CC&Rs and the legal HOA scheme based on the seminal Homes Association Handbook of 1964.

Welcome to the New America of HOA-Land.