Tag: due process

CAI response to amicus brief: laws never protected HOA homeowner’s constitutional rights

 

My long awaited debate with the CAI (Community Associations Institute) lawyers on substantive issues relating to HOAs has finally come about. Well, almost. The CAI member law firm and attorney for the HOA responded to the amicus brief submitted to the Arizona Supreme Court by this homeowner rights advocate in Gelb v. DFBLS, CV 10-0371-PR. In short, two issues are addressed: the constitutionality challenge itself, and the alleged political bias by the appellate court in its decision holding the statute unconstitutional.

 

First, the Response simple reiterates its Response to the Petition for Review, maintaining that the issue was already settled by the appellate court.

 

Second, as to the arguments advanced in the amicus brief that the appellate court allowed political considerations to influence its opinion, the Amicus, that’s me, is painted as a conspiracy believer. “The amicus curiae closes his brief with a conspiracy theory about the involvement of undersigned counsel in this case and other cases in which the constitutionality of the statute was challenged.” The CAI member attorney defends his rush to file this appeal, which occurred as a result of the Phoenix Townhouse v. AZ OAH superior court default decision, with “legal counsel had the obligation to raise every issue available that could result in prevailing for his client in the pending case.” However, this sidesteps the question raised in the default Phoenix Townhouse case, still unanswered by the attorney, as to the legal standing of the real person in interest, Ron Meritt, who had left the HOA prior to the constitutionality challenge. Smith coud not risk opening this door again.

 

In unsupportable conclusions, the attorney, Jason Smith, charges me with suggesting that his constitutionality challenge was made to intimidate homeowners from filing suit. That does not follow logically. The challenge, as stated in the brief, was that the HOA attorneys weren’t looking too good and had to end the success of OAH adjudication. Further far-fetched charges made by attorney Smith include that I “liken undersigned counsel and his firm to henchmen for authoritarian regimes suppressing the rights of homeowners.” The record before the Arizona Legislature over the past 10 years and statements made by the firm are well documented in this respect. Smith adds, “The conspiratorial hyperbole notwithstanding”, we were just doing our job for our client.

 

Furthermore, in an unbelievable statement echoing that of the CAI amicus brief before the NJ appellate court in Twin Rivers HOA free speech case, Smith firmly states that, “It is clear from the that the amicus curiae simply wants to impose constitutional protections on members in homeowners associations. The law has never supported that proposition.” Let me rephrase that statement:

 

The law has never supported the proposition that homeowners in HOAs are entitled to constitutional protections.

 

A copy of CAI’s Response Brief with its above in-your-face statement of the law should be sent to every state attorney general, every state legislature, every state real estate department, and every state’s consumer watchdog and consumer protection agency. This declaration by Smith, p. 8, should be highlighted as evidence of misrepresentation and fraud in the sale of planned communities and condos, and homebuyer protections demanded.

 

Finally, in Smith’s gratuitously offered proposed solution, as all those of us who have attempted to obtain justice from our state legislatures well know, and as CAI — the national lobbying organization supporting the HOA establishment — and attorney Smith well know, the legislatures have not accepted the fact that the HOA laws are unconstitutional special laws for private organizations, as these laws cannot be supported by a necessary and compelling government interest. This level of judicial scrutiny is necessary to deny due process and equal application of the law protections to the residents in de facto, yet unrecognized HOA private governments.

 

Sources:

Staropoli amicus curiae brief

CAI/Smith amicus response

CAI Twin Rivers amicus curiae brief, p. 19.

AZ Supreme Court accepts advocate’s amicus brief in challenge to HOA statute

The Arizona Supreme Court has accepted my amicus curiae brief in support of constitutionality of the DFBLS/OAH due process statutes (Gelb v. DFBLS, CV 10-0371-PR). The Court has yet to decide if it will hear the Petition from the homeowner. Neither party objected to my brief, not even the CAI HOA law firm that received harsh treatment. I had presented background facts and arguments in an effort to assist the Court in understanding the disgraceful state of affairs with HOAs.

Responses to my brief, if any, are due within 20 days. For over 10 years I’ve been waiting for the CAI HOA attorneys to debate the substantive, constitutional issues with me for all to see.  I await their response.

The excerpt below makes a strong accusation against the Arizona Legislature, which can be applied to all state legislatures. Given this posture,  I would like to thank those all too few individual legislators who had come forth over the years, in several states, to do battle for homeowner justice, but who were not sufficient to overcome the opposition in their legislatures. Your efforts are very much appreciated.

From the first paragraph of my Conclusion:

It is quite evident that an Arizona homeowner living within an HOA governed subdivision cannot look to the Attorney General, the Legislature, DFBLS, or ADRE (real estate dept.) for due process protections and the equal application of the laws. Even the lower courts are suspect. With all due respect, it remains to this Court to stand behind the promises and covenants between our system of government and the people as set forth in the U.S. and state Constitutions.

See Advocate submits amicus brief in AZ supreme court appeal of HOA due process, and for a copy of the amicus brief, Amicus.

Unconstitutional laws and sanctions of invalid HOA powers

 

There are two Arizona bills dealing with substantive, constitutional HOA reforms:  SB 1170, the issue of who controls public streets, and SB 1148, the restoration of due process protections for homeowners by means of an independent tribunal adjudication of HOA disputes. Legislators need to understand the constitutional aspects of these bills and, by the failure of the Legislature to act, the sanctioning of HOA actions that are invalid, unconstitutional, or against public policy. “Sanctioning,” as used in the courts, is the statutory permission to act in a manner that the legislature does not deem illegal. The chief example of this sanctioning is the use of the word “may” in the statutes. While not a compulsory order by the Legislature, it is nevertheless a statement that any such acts are not illegal. A second common example of sanctioning, the error of omission, is the refusal to enact statutes to declare certain acts as illegal.

 

The crux of the opposition to these bills, with their “equal application of the laws” issue, has been the popular cry of protecting individual rights, specifically in regard to “freedom of contract” and “no government interference.”  The more elegant opposition can be stated by a quote from the Dec. of  Indep.:  “governments are instituted among men, deriving their just powers from the consent of the governed.”  The opposition would have legislators believe that this is the end all of the Constitution.  They believe that the HOA constructive notice “contract” is sacrosanct, inviolate, and there is no need for a “Truth in HOAs” law similar to other consumer protection laws, like truth in lending and truth in advertising.  However, the special consideration given to the HOA industry by pro-HOA,  no homeowner protections legislation, and the unconscionable adhesion contract nature of the CC&Rs — with its implicit and non-existent surrender of the homeowner’s rights, freedoms, privileges and immunities — can easily be seen as a violation of The Arizona Constitution :

 

Read the complete commentary at constitutional.

 

co-opting the HOA “homeowners bill of rights”

 

In 2008 the 1994 UCIOA (Uniform Common Interest Ownership Act) was modified to accommodate the outcry from homeowner rights advocates.  This shortened version is known as the Uniform Common Interest Ownership Bill of Rights Act (UCIOBORA), and is a political maneuver to co-opt the real meaning and intent of a “bill of rights.”  Here’s an explanatory excerpt from UCIOBORA:

 

Further, ULC [Uniform Law Commissioners] acknowledges that it will often not be feasible to enact UCIOA 3.0, in part because of the difficulty drafters in the States may encounter in integrating any new adoption of the existing Uniform Acts with the laws that may already exist in a particular state.  For these reasons, ULC  promulgated a free-standing and relatively short Uniform Act that addresses all of the ‘association versus unit owner’ issues touched on during the drafting of the 2008 UCIOA amendments. The free-standing Act is known as the Uniform Common Interest Owners Bill Of Rights Act or “UCIOBORA”. While not all sections of UCIOBORA are identical to UCIOA 3.0, the concepts underlying each Act are the same, and are adjusted simply to recognize the simplified nature of UCIOBORA.
 
 
In short, UCIOA wasn’t selling.  It seems that UCIOBORA is the sad result of the political motives to get UCIOA selling again. It’s a document that does not at all read like the US Bill of Rights, or any state constitution’s Declaration of Rights (state constitution equivalent of the Bill of Rights), or even the Declaration of the Rights of Man and Citizen (France, 1793).  Far from it.  Rather it reads like your current CC&Rs and UCIOA with a number of concessions to reality.  However, it lacks substantive protections of homeowner rights, such as: a fair and just due process by means of an independent tribunal; fair elections procedures with equal and fair access to membership lists, and equal opportunity appearances in the HOA newsletter/website; restrictions on the right to foreclose, since the HOA is not in the same position as a lender who had advanced hard cash; and enforcement by means of penalties against board violations of the governing documents, otherwise all such laws are just recommendations dependent on the goodwill of the affected persons.
 
A homeowners bill of rights is necessary because the Constitution with its Bill of Rights amendments does not apply to private HOA governments.  HOA governments operate outside the Constitution, which is greatly desired and defended by HOA supporters as they would not be able to act in ways that a civil government cannot act.  A statement in a declaration that says that the HOA is subject to the Constitution is meaningless, since the Constitution does not apply to private entities.  What is necessary is a statement that the HOA acknowledges the Constitution as the supreme law of the land and irrevocably agrees to be subject to it  as if it were indeed a government entity.
 
 
Short History
In 1997, Elizabeth McMahon of AHRC filed a Homeowners Bill of Rights with the California Law Review Commission looking into revising California’s HOA statutes.  In 2000, George K. Staropoli submitted a statement to the Arizona Interim HOA Committee, Homeowner’s Declaration of Independence from the HOA system of government.  In 2006, AARP produced a public policy statement, A Bill of Rights for Homeowners in Associations, written by Houston attorney David Kahne.  In 2006 the legal-academic aristocrats (lawyers for the real estate interests) at a Texas senate hearing proposed a Texas Uniform Planned Community Act (TUPCA).  Responding to Texas homeowner rights advocates, the committee was told that UCIOA (the model act for TUPCA) was being modified to include a bill of rights section.  In 2008, George K. Staropoli informed the California Law Review Commission of a proper Members Bill of Rights section to the Davis-Stirling Act (This section was later  dropped from the revision).
 
 

AZ bill, SB 1148, seeks to restore OAH adjudication of HOA disputes

The Arizona bill, SB 1148, seeks to overcome the objections of the appellate court in Gelb, and restore due process protections to homeowners in HOAs by means of OAH adjudication. (See Advocate submits amicus brief in AZ supreme court appeal of HOA due process).  Below is the explicit statement of intent for this legislation, of which one purpose is to  protect the consumer who buys a home in an HOA.

Sec. 4. Legislative findings and intent; department of fire, building and life safety; community disputes

It is the intent of the legislature to find, determine and clarify all of the following after careful consideration of the case Gelb v. Department of Fire, Building and Life Safety, 1 CA CV 09-0744, filed October 28, 2010 (Ct. App. 2010):

1. The department of fire, building and life safety has exercised substantial responsibility for many years in the enforcement and application of state laws and private contracts that regulate the relationships between those who reside in and those who control certain types of common housing, namely, mobile home park residential communities.

2. The legislature has determined that while the direct licensure of mobile home parks and their owners may not have been necessary, the regulation of their private, legal relationships with their tenants has been and continues to be an important consumer protection function of the department of fire, building and life safety and that department has developed considerable expertise in interpreting, enforcing and applying the statutes relating to these mobile home communities and in interpreting, applying and enforcing the terms of the leases, rules and other documents that regulate the relationship between the residents of the mobile home parks and the owners and managers of those parks, and doing so in a cost-effective manner for the residents.

3. The legislature further determines and finds that while direct licensure and regulation of condominiums and planned communities may not be necessary at this time, the legislature has repeatedly found over the years that owners in condominiums and planned communities are frequently subjected to inconsistent, unreasonable and often unlawful enforcement and application of the declarations, rules and bylaws that govern their communities, their managers and their boards of directors, and owners are often unable to afford the cost of formally litigating their disputes in the superior court.

4. The legislature further finds that the continuing use of the existing hearing officer function in the department of fire, building and life safety will provide for an efficient use of already-established common interest community expertise at this agency, will provide an important consumer protection for owners in condominiums and planned communities and will efficiently and effectively provide for resolution of these common interest community disputes without the expense, formality and difficulty of requiring a trial in the superior court in every instance, and will do so without the cost and bureaucratic complexity of creating an entirely new administrative body to perform these important functions, while still maintaining the ability and right to recourse in the superior court, and without threat to the core functions of the judiciary.