I let the Arizona Legislature know that advocates are not as stupid as they would like to believe (See Observations on AZ legislative treatment of HOA reform bills We know what is going on and has been happening for years with respect to legislative support for private government HOA regimes. HOAs that deny homeowners their rights and freedoms while imposing harsh penalties only on the members and not on the HOA boards.
The attitude of the legislatures appears to be: The HOA must survive at all costs – it’s a matter of national and state security so constitutional protections be damned.
A leading Texas advocate has added to this exposure of legislative cooperation, support, and coercion to permit HOAs to rule without accountability. Read her Open letter.
There are 4 main constitutional issues that are continually ignored by the legislatures: clean elections procedures; due process and the equal application of the laws; ‘consent to agree’ fallacy; and that the Constitution is only about ‘no contract interference.’ These issues must be addressed and reforms instituted, but they are not addressed because the legislators well know that they are defending the indefensible if they speak out.
It falls to the true advocates for HOA reform to have the courage to speak out about the reality of the HOA legal concept. They need to set the record straight about legislation supported and promoted by the so called “stakeholders”, the vendors (read as HOA attorneys and managers) who make money from the unrepresented and truly affected class, the private property owners, the homeowners.
If you listen carefully to the HB 2371 sponsor and committee chair explain her bill you would hear the familiar attitude taken by many legislators. First, you were told that a “meeting of all the stakeholders” to work on combining all the bills into one took place. Oh yeah? All the stakeholders, but no homeowners.
Second, the objective of the bill was to remove “all the contentious issues” and arrive at a bill satisfactory to all. So, those serious violations of homeowner rights will die each time CAI shouts, “HELL NO, WE WON’T GO”! And of course, there ain’t nobody present to object.
So, that would explain what happened to the wording of SB 1333, the “clean elections” in HOAs bill?A bill that, if passed, would severely cripple the political machine HOA boards and reduce HOA attorney influence. A bill that would put an end to HOAs, under attorney guidance, finding ways to deny homeowners a legitimate voice in their governance. But, there were no homeowners invited to the stakeholder meeting!
Advocate Pat Haruff corrected the sponsor on this comment about “stakeholders.” No response from the Senator. That means that your pool guy, AC service man, landscaper, etc. are all stakeholders in your private property interests because they make money from you, the homeowner. And the legislators don’t need to hear from you! Welcome to how state legislatures are creating the New America of HOA-Land.
An argument against unlicensed management companies being granted exceptions to the unauthorized practice of law (UPL) laws was raised. While the bill would allow managers to represent HOAs in small claims court, it says nothing about homeowners being allowed to have their own unlicensed person speak for them. No one against the management company amendment portion brought up the AZ UPL decisions and opinions contained in AZ Supreme Court’s Final Order: HOA management firm engaged in unauthorized practice of law. Well, did you really expect CAI or AACM (manager’s association) to do it? And believe me they know, because the management firm was both a CAI and AACM member.
The CAI paid lobbyist once again falsely proclaims that CAI represents homeowners, failing to mention that CAI does not, and cannot as a business trade group, represent consumers — and HOAs are consumers of CAI member services. No one corrected him.
I also got the feeling from the sponsor’s comments that the legislature was sort of tired of all these HOA bills, again and again, so wrap them into one bill and get it done with. I wonder if the annoyance is because they know that they are doing wrong to the people whom they are supposed to represent, and favoring the special interests. What about protecting the private property rights of the individual, a principle uttered so many times in so many arenas except in the HOA arena?
I can’t recall over the past 5 years many HOAs coming before the committees on behalf of HOA bills. No, it’s just the special interest vendors, the “stakeholders”, who live off HOA income who come before the committees. And nobody seems to notice. Yet, the homeowner who comes and/or writes is given short rift. I’ve told several legislators over the years that we will be coming back year after year until they get it right.
So, there it is! Homeowners are at the bottom of the food chain, with the legislators ignoring the principle that in a democracy citizens rule. To paraphrase a statement in an address to the British prisoners of war by the Japanese commandant in the movie, The Bridge on the River Kwai,
The legal doctrine of Monell claims appears to be suited for those instances where public policy permits violations of constitutional rights under 42 US 1983, “Civil action for deprivation of rights”.[i]These claims can pertain to police departments and county attorneys, planning boards, and real estate departments and other HOA commissioners or ombudsmen officials if they have adopted such a policy. In other words, if it is the policy of a planning board, or the police department and/or county attorney to ignore or dismiss legitimate complaints against HOAs then this policy allows for the application of civil rights protection under federal law.
In Nevada, Bob Frank and Tim Stebbins have filed such a federal claim[ii] against Henderson Police Department for false arrest and malicious prosecution relating to their whistle-blowing, which involved IRS rules violations relating to tax refunds to HOAs. Without probable cause and an independent audit, the police arrested the two homeowners under filing a false claim. Subsequent to their arrest, the IRS completed its audit that did indeed substantiate the allegations of Frank and Stebbins.
Basically, a Monell Claim involves a claim “against a government unit [with] sufficient facts to show (1)the existence of a government policy or custom and (2)that the unconstitutional act was taken pursuant to that policy or custom.”[iii] Further clarification of what constitutes “policy” was provided in Pembaurv. City of Cincinnati[iv] decision that held, among other things,
“We hold that municipal liability under § 1983 attaches where — and only where — a deliberate choice to follow a course of action is made from among various alternatives by the official or officials responsible for establishing final policy with respect to the subject matter in question.”
In other words, the policy or custom must come from a high-level official who can be said to speak for the agency, and thus the municipality. For example, Commissioners and Directors who are permitted to set rules and regulations by law. Any such rule, especially an explicit policy statement, may lead to a Monell Claim. For example, in Pembaur the Prosecutor was held to be the final authority when he told the police to break into a business without a warrant. In Frank, it is shown that the Police Chief and Municipal Judge approved the probable cause claim for the criminal arrest warrant. See this link for current documents in this case.
When the “unspoken alliance of no negatives about HOAs” becomes incorporated into an agency policy, then Monell Claims may arise.
Notes
[i] “Every person who, under color of any statute, ordinance, regulation, custom, or usage . . . subjects, or causes to be subjected to . . . the deprivation of any rights, privileges, or immunities secured by the Constitution and laws, shall be liable . . .” (emphasis added).
[ii]Frank v. City of Cincinnati, 2:12-cv-01988-GMN-GFW (D. Nev.) (not decided).
“We are not final because we are infallible,
but we are infallible because we are final.”[i]
This Commentary excerpts relevant arguments from the court’s opinion in Poris v. Lake Holiday[ii] relating to police powers and false imprisonment. I find it necessary to use excerpts so you, the reader, can follow the issues and analysis as they actually occurred before the court. I believe this is the best way to understand public policy and how the laws are interpreted by the HOA attorneys and courts. Please read through this lengthy commentary, and discuss with others.
FIRST, let’s look at the analysis of the appellate court’s finding that the stopping of the member for an HOA rule violation was unlawful. The appellate court held,
“Specifically, plaintiff [homeowner] argued that: the Association was not authorized by law to stop vehicles and detain drivers;
“[S]ecurity guards occupy the same status as private citizens.
“[HOA] security officers were attempting to assert police powers that they had neither the right nor the power to assert. [my emphasis].
“Because [the HOA] restrained plaintiff for violating an Association rule, not a criminal law, plaintiff established the elements necessary for his false imprisonment claim.”
It is important to understand the detailed reasoning as to why the HOA had no powers to arrest was given:
“The appellate court concluded that security officers are without legal authority to stop and detain drivers for violating Association rules, because those rules are enacted by the Association, not the General Assembly, and therefore do not constitute an ’offense’ . . . .”
NOW, let’s see how the 7 wise men of the Illinois Supreme Court saw the law.
Police powers.
“Plaintiff contends that only the Illinois legislature has the authority to create a private or public police department. . . . Plaintiff and the appellate court err in viewing this issue as one involving private citizens improperly attempting to assert police powers. . . . The appellate court failed to consider the Association’s enforcement of its rules and regulations in the context of its authority as a voluntary association to enact and enforce those rules and regulations.
“[Since] courts generally will not interfere with the internal affairs of a voluntary association absent mistake, fraud, collusion or arbitrariness. . . . plaintiff generally complains that the Association was unlawfully exercising police powers and authority . . . . However, plaintiff does not, and cannot, argue that the Association and its security officer did not act consistently with its bylaws, or its rules and regulations . . . . ¶
”Plaintiff also argues that the Association is exceeding the legislative powers granted to not for profit homeowner’s associations in enacting and enforcing its traffic rules. . . . each corporation shall “have and exercise all powers necessary or convenient to effect any or all of the purposes for which the corporation is formed.” [IL statute]. . . . Regulating and enforcing traffic rules is reasonably necessary to maintain the Lake Holiday roadways.
¶
“The Association rules and regulations were enforced only on Association property, and citations for violations of the rules and regulations were only issued to Association members. Consequently, the Association was not unlawfully exercising police powers that it did not possess, but rather was acting within its authority as a voluntary association to adopt and enforce its own rules and regulations.
“We can discern no logic in allowing a private homeowners association to construct and maintain private roadways, but not allowing the association to implement and enforce traffic laws on those roadways.”
And finally, false imprisonment.
“[T]he appellate court erred in analyzing [the HOA’s] stop of plaintiff in terms of a private citizen effecting a citizen’s arrest, rather than analyzing the stop as pursuant to Association rules and regulations. . . . These facts would lead a person . . . to believe or entertain a strong and honest suspicion that plaintiff was guilty of violating Association rules. Consequently, [the HOA] had probable cause to believe that an offense was committed by plaintiff, which is an absolute bar to plaintiff’s claim for false imprisonment. [my emphasis].”
My perspective
In Poris we have another instance of a state supreme court holding private contracts superior to the Constitution (See NJ supreme court opinion in Twin Rivers[iii]). Apparently, the only thing that the Constitution has to say is an absolute “no contract interference.” Note how the court adopted a narrow reading of the laws as it parsed and examined the precise wording of the laws, not stepping back in its alleged legal wisdom seeing only the trees and not the ugly forest.
The court cleverly ignored the question of detaining non-members, and the question of public streets.
Think of the implication that a non-profit, any non-profit, can enforce its rules even by detain and arresting its member. And think of the impact on the US Supreme Court question, and Arizona laws (SB 1070), dealing with similar issues of detention, probable cause, and reasonable suspicion by police officers to demand “your papers” to uncover illegal immigrants.
I can summarize the Illinois opinion with the simple statement by William Pitt, part of which appears on the façade of the Arizona Supreme Court building:
Unlimited power is apt to corrupt the minds of those who possess it: and this I know, my lords, that where law ends, tyranny begins!”[iv]
[i] Justice Robert Jackson, Brown v. Allen, 334 US 443 (1953). (Robert H. Jackson was also US Attorney General and chief US prosecutor at the Nuremberg Trials).
[ii]Poris v. Lake Holiday, 2013 IL 113907 (Jan. 25, 2012). (It should be noted that I cannot find any record of the amicus curiae for the HOA, an Illinois Association of Lake Communities).
[iii]Committee for a Better Twin Rivers v. Twin Rivers, 929 A.2d 1060 (NJ 2007).
[iv] This statement was made by Lord Chatham (William Pitt) to the British House of Lords in January 1770.
On December 21, 2012 my Petition to the White House to declare that the people living in HOAs are still citizens of this country and of their respective state (White House petition to defend US citizenship of people in HOAs) failed to receive the necessary submissions for a WH response. That petition failed miserably, evidencing a very narrow understanding of the actions necessary for HOA reform legislation. This lack of interest and concern denied reformers an opportunity to create a dialogue with Washington on a problem facing homeowners in all the states.
A petition related to citizenship and a united country (grant the State of Louisiana to withdraw from the United States of America ) did get the 25,000 submissions (just under 39,000 submissions) and received a response from the WH, Our States Remain United. Shame on all those advocates seeking reforms who failed to see an important opportunity to advance national awareness of and the need for HOA reforms across the country and in every state.
HOA Constitutional Government 