Tag: justice

Indiana AG given authority to pursue HOAs for criminal acts

My to my surprise I had discovered that a state Attorney General must have specific legislation granting the AG to act against wrongful acts by an HOA.  Homeowners contacting their AG, like myself and many others, have been told that such legislation is needed.  Fortunately one state, Indiana, stepped up to the plate and enacted a law granting the AG to so act (PL 49-2011, HE1058).

Here’s the simply and succinct wording of this groundbreaking law, the first that I am aware of.

 

(b) IC 32-25.5-3-8 applies to all homeowners associations.

Sec. 8.

(a) The attorney general may bring an action against a board or an individual member of a board of a homeowners association if the attorney general finds that:

(1) the association’s funds have been knowingly or intentionally misappropriated or diverted by a board member; or

(2) a board member has knowingly or intentionally used the board member’s position on the board to commit fraud or a criminal act against the association or the association’s members.

(b) A court in which an action is brought under this section may do the following:

(1) Issue an injunction.

(2) Order the board member to make restitution to the homeowners association or to a member.

(3) Order a board member to be removed from the board.

(4) Order a board member to reimburse the state for the reasonable costs of the attorney general’s investigation and prosecution of the violation.

Please note that this authority is restricted to criminal acts and does not permit the AG to get involved in the multitude of civil matters such as, breach of contract, rules enforcement, assessment collections or maintenance.  Basically, it’s about theft, embezzlement, misuse of funds, etc.  However, it is an important move in the right direction of the equal application of the laws and due process protections under the 14th Amendment.

This past August the Indiana AG filed suit against The Harbours Condominiums Association and against board members Kevin Zipperle, Mary Lou Trautwein-Lamkin and Sharon Chandler for allegedly breaching their fiduciary duty and committing fraud.

HOA board mentality and unconscionable CC&Rs rewrites

Homeowners living in HOAs must decide what side of the fence they are sitting on!       Whether on the side of management or on the side of the rank and file homeowner?  There is a major difference as the HOA is not a democratic community government, but a corporate form of government.  And never has a corporate form of government been described as democratic.

The business parallel of “management vs. employees” in HOAs is alive and well. Management represents the HOA entity and not the members, just as management represents the stockholders and not the employees.  Legally this fact is found everywhere.  And the HOA attorney who advises the board and rewrites CC&Rs and amendments represents management and not the interests of the members.  How many times have you seen and heard “for a more productive and effective HOA” and “for the benefit of all members collectively”?   Sounds nice, but the two are not equivalent.  The board does not speak for all the members and that’s why there is member voting.

A most egregious and unconscionable act by the board and its attorney can be found in the broad rewrite of the CC&Rs where liberties are taken in favor of the HOA.  Where the homeowner again unknowingly waives and surrenders his rights and freedoms to the HOA, because the homeowner rank and file does not hire their own attorney to explain the impact of the HOA changes.

An example of how far this unconscionable activity can go involves the rewrite of CC&Rs by an Arizona CAI member attorney firm, and member of CAI’s College of Community Association Lawyers (CCAL).   In the rewrite the attorney deleted “reasonable” with regard to attorney fees and added “all”.  The attorney also did not adopt the “prevailing party” widely accepted standard of fairness, but mandated the homeowner to pay its fees regardless if the homeowner wins.  In other words, even if the homeowner had brought suit against HOA wrongful behavior and wins, he must still pay the HOA attorney fees.  Covenants that are unconscionable and against public policy are held to be invalid.

Additionally, a festering issue at the Arizona Legislature has been the awarding of attorney fees by the Office of Administrative Hearings (OAH).   The attorney uses the term “administrative law judge” as most homeowners would know that OAH does not pay attorney fees.  This blatant “squeeze it by and maybe they won’t notice” tactic is disgraceful.  Yet, in 99% of the cases heard at OAH the HOA has decided to hire the unnecessary attorney.  The HOA should pay for this unnecessary decision.

And yet many homeowners would go along with this “stick it to the homeowner” mentality.   Presumably because they see themselves not as the “homeowner” at issue, and therefore it doesn’t affect them.  But, the rewritten covenants apply to them, all of them.  And it also applies to the directors and officers who believe that this unconscionable conduct is good for the HOA in the long-term, and that it also doesn’t apply to them.  But, unjust and unfair covenants that openly serve the interests of their attorney cannot be seen as in the best interests of the HOA.

Homeowners in HOAs must decide where they stand.  For their rights or for unconscionable conduct and acts of bad faith by the HOA board and its attorney who is not your attorney.

HOA board mentality: ‘because we can’ and ‘because we don’t have to’

How many times has a board member come up to you and say, “Hey, see you’re building an addition?  You know, you need to submit a request for approval before you do anything.  Come on down and let’s talk about it?”  Or, “Our landscapers will be coming by on Thursday to reset the sprinkler timers.”

Why not?  Because it’s the board’s mentality: “Because we can” and “Because we don’t have to.”   This mentality develops, based on my long history in seeking justifications for many outrageous acts by HOAs, from long term indoctrination into hair-splitting the laws and covenants, a parsing of the laws, in the best interests of the HOA.  Of course, coming from the HOA attorneys.  And there are no other rational and legitimate reasons for doing so, or not doing so, especially when good faith conduct is required of officers and directors.

What ever happened to “HOAs create pleasant, harmonious, carefree living, and democracy at work?”  What ever happened to social graces?  Good neighbors?  And common friendship?  I think that the problem lies with recourse to the CC&Rs that must be enforced at all costs got in the way. 

HOAs create an unhealthy climate.  See, Why do people harm others in HOAs?,  The HOA apathy affliction: a political dynamic

 

Supreme Court justices comment on Arizona judicial integrity

Former US Supreme Court Justice O’Connor and former Arizona Supreme Court Chief Justice McGregor speak of the outstanding integrity, impartiality and fairness of Arizona judges and on the oversight entity,  the Commission on Judicial Conduct.

In contrast, this writer presents the two incidents of unquestionable violations of judicial ethics and conduct as set forth in the Arizona Rules of the Supreme Court, Code of Judicial Conduct.

The details of the two incidents can be found at If the watchdogs of the judiciary fail, it follows that the government also fails, and The State of Arizona will not protect buyers of HOA homes!

And HOA Justice for All

Where law ends, tyranny begins[i]

I was just released from jury duty yesterday.  I had submitted a Request for Exclusion due to Issues of Public Interest/Public Welfare, which went unanswered.  During the jury selection process, I so informed the judge of my request, which he had not seen.  I volunteered a copy that I had brought along.

After supplying the judge with a copy I was given a one-on-one with the judge and lawyers.  The short dialogue was as follows:

Judge:  You are saying that you cannot give a fair and impartial opinion on this case?

George:  No, I can’t.  As you have read, I was insulted and disrespectfully treated while attempting to provide for justice.  Now the court is asking for my valid opinions as a juror.  I cannot participate in a judicial system that acts in such a way.

Judge:  So let me clarify.  You are saying that, because of these incidents, that you cannot give a fair and impartial opinion?

George:  Yes, that’s right.  I spent over 10 years fighting for constitutional and legal rights for homeowners and have been treated as such.  I cannot participate.  Your Honor, it was just about a month since the Maxwell ruling that I received a jury summons.  I have not been called for jury duty in over 10 years.  I get the feeling that they are out to get me.

Hidden smiles from the judge and a lawyer.  I was excused.  I thank the judge for making my Request part of the record, not a common occurrence.  The strongly worded and angry Request can be read here.

[i] The motto on the façade of the Arizona Supreme Court building.