Tag: law

why shouldn’t HOA directors be held for criminal activities if the shoe fits?

The latest AZ-CAI chapter’s Call to Action, Apr. 5, 2012, objects to the AZ bill, HB 2160, that would make violations of the HOA elections procedure a Class 1 Misdemeanor. No reason s offered as to why not. The bill clearly states that only if the violation is an intentional violation, which is only fair considering the importance of fair and just elections in a democratic society. And aren’t we told by CAI that HOAs are the model of democracy?

Again, CAI resorts to scare tactics by focusing on the penalties under a class 1 misdemeanor. And that the fines, that can be as high as $20,000 for the HOA corporation, would be passed on to the homeowners. What an excellent approach to get member involvement, don’t you think, CAI? BTW, the Call does point out that the bill is to stop “electioneering,” you know, to stop the political machine interference so the people can “throw the bums out.”

The “we are poor volunteers” doing community good argument appears, but the presumption is that they are indeed doing good by opposing elections reforms. It ignores the fact that the bill addresses intentional acts by the political machine running the HOA for its own personal agenda. And the “death of the HOA” argument if we hold directors accountable for their acts is there, too. Well, should we support corrupt and incompetent entities used by a few for their personal agendas, entities that can ruin a member through fines and cruel foreclosure?

Finally, in an admission that not all actions by directors are covered by insurance — surprise, surprise – the fear of no insurance coverage is used. You know, it is not the acts of the directors themselves that is the precipitating cause of such refusals by insurers. No, not the directors, us poor volunteers.

I can hear those directors saying, “Damn! And we had it so good not being held accountable. Gee, I don’t think HOA life is such a good idea now that the “free ride” is over.”

I am well aware of the frequently used techniques that amount to legalized extortion by the HOA or its agent, the management firm. The 2 common instances are forcing the member to talk to the HOA attorney, and to sue on unsubstantiated and frivolous allegations. In the first instance, the member who is given notice of unpaid assessments but does not receive a detailed accounting of the alleged debt. So he rightfully asks the HOA for a statement of his account, not provided by the attorney, but is told to talk to the attorney. Why?

If the manager of president is not sure, he should contact the attorney on his dime and not the member’s dime – attorneys costs are charged back to the member. This is a legitimate request for corporate records and not attorney-privilege concern. And the HOA attorney knows this.

The second instance is the notice of a violation by the  attorney on HOA statements that would fail “reasonable cause” tests.  These allegations are acted upon without any attempt to “check out” the HOA charges, as it must necessarily be concluded, violating R. Civ. P. 11(a), “that to the best of the [attorney’s] knowledge, information, and belief formed after reasonable inquiry it is well grounded in fact and is warranted by existing law.”

The attorneys know that in the vast majority of these cases the homeowner will not go to court and either pay, if he can, or take the default judgment by the court. One JP Court judge told a homeowner in such a case that, “Normally, these type of HOA cases are default decisions . . . “ I would say that that amounts to legalized extortion with the attorney cooperating and looking the other way. See Code of Professional Conduct below).

(Sadly, Arizona bills with meaningful penalties against the HOA failed: SB 1240 would have awarded triple damages against HOA for selective enforcement actions; HB 2455, would have held the directors directly personably liable for member attorney fees; and HB 2731, would have held directors personally liable for lawsuits not made in good faith. They will be back next year, and the year after until put into law.)

HB 2160, elections reforms with meaningful penalties, gives the member a solid footing to take away control of the HOA by political machines and rogue boards. It awaits final votes.

Rules of the Arizona Supreme Court, Part V, Regulation of the Practice of Law, D, Lawyer Obligations, Rule 42.

1.2 (d) A lawyer shall not counsel a client to engage, or assist a client, in conduct that the lawyer knows is criminal or fraudulent

1.13 (b) If a lawyer for an organization knows that an officer, employee or other person associated with the organization is engaged in action, intends to act or refuses to act . . . that is a violation of a legal obligation to the organization, or a violation of law . . . .

NEW HOA DOCUMENTARY FILM, THE HOAX

On behalf of Rodney,

Hi there, I’m Rodney Gray. I am a former U.S. Marine, an actor and a filmmaker, who is currently directing and producing a feature documentary on the homeowners’ association (HOA) industry for submission to film festivals and future distribution, but also as my MFA production thesis at the University of North Texas.

My new film, The HOAX, follows an investigative reporter, homeowners, and HOA reform activists as they reveal shocking evidence of financial and psychological hardships experienced by people throughout Texas and Nevada. A few of these people, including the filmmaker, have been the subject of adverse actions from the very HOAs created to help them.

Please feel free to visit our websites to find out more information, get updates and watch the teaser trailer.

  The HOAX Movie Website:  http://thehoaxfilm.com/

The HOAX Trailer Tease and Campaign Website: www.indiegogo.com/thehoaxfilm

 

Spread the word and please share these links. Help us bring injustices into the light.

 

Best to you all,

Rodney

 

 

AZ HB 2030 – slippery slope to Sanford police dept.?

The failures and continued actions of the Sanford, FL police department, with respect to the failure to uphold the laws on arrest in the Trayvon slaying, is disturbing. It reeks of a total disregard for justice and fair play. It causes me to consider what if your neighborhood HOA had these powers? The public policy with respect to HOAs has been a hands-off policy with and no accountability under the law – let them do as they please. Just as it seems the Sanford police department has adopted with its failure to arrest Zimmerman.

And yet, the Arizona Legislature sees no serious issue with the unrestricted delegation of regulatory powers to HOAs over parking on public streets as set forth in HB 2030.

“An association may regulate the parking of noncommercial vehicles on any roadway for which the ownership has been dedicated to or is otherwise held by a governmental entity . . . .”

My suggested amendment was ignored, “may regulate the parking . . . only with respect to parking by the members of the HOA who have waived their right to public parking on public streets within the HOA governed subdivision.” And the legislature rejected the position that the HOA can get a variance if it has legitimate parking concerns, like everybody else! The legislative intent to allow further unrestricted powers to these independent HOAs has become much clearer.

Would this bill put us on the slippery slope path that can produce an event like the Trayvon slaying? In Arizona, you can carry concealed weapons almost anywhere. The bill does not create any new laws, but is simply a re-affirmation for all to know of who runs local government. If this bill becomes law, then I believe we are on the slippery slope to the “law and order” of the wild, wild west by the power factions, like the cattle barons, railroad, and mining interests of the Old West. Arizona already had one incident where two HOA board members were killed in 2000 during a board meeting.

Although the bill is only about parking at this point, the real import of this bill is the starting out on the slippery pathway to further lawlwssness by HOAs. Where does it say that the the uniformed and arm-banded “HOA Security,” the police arm of the HOA, cannot stop and detain – that means ‘arrest’ — people on public streets? And Maricopa County Sheriff Joe Arpaio doesn’t want to do police public streets in HOA subdivisions. And we well know the great care and concern for proper procedure and obedience to the laws as exhibited by HOAs today in other areas. Can an incident like in Sanford happen with this grant of unrestricted powers?

Won’t happen here? Too far fetched? Wanna bet? To a lesser extent lawlessness  is happening everyday in HOA-Land, with respect to such issues as, failing to respond to records requests, making up rules on the fly, arbitrarily fining people, “political machine” elections, and going to court on the most trivial grounds, etc.  Now what will these rogue boards do next?

Was Zimmerman acting in a lawful manner?

A lot has been reported about Zimmerman’s actions that led to his claim of self-defense and protection under what  is generally known as Florida’s “stand your ground” law. A lot has been reported in defense of Zimmerman by the Sanford police position that claims it can only rely on the statements of Zimmerman,  as there was no other evidence.  Well,  that’s understandable  — “dead men tell no tales.”

But evidence has been coming forth, but no questioning of or arresting  Zimmerman.   From the evidence at hand, it must be asked if Zimmerman was acting lawfully, which shouldn’t be too hard a case to make under the “reasonable suspicion” or “probable cause” standards for an arrest.  The court makes the determination of  whether or not a crime has taken place, not the police.

The Florida statute before us is, “§ 776.013, Home protection; use of deadly force; presumption of fear of death or great bodily harm,” Title XLVI, Chapter 776, Justifiable Use of Force.  Here’s what must be decided by the court, not the police.  Paragraph  (1) sets forth what constitutes reasonable fear of harm. Under 1a, was Trayvon unlawfully entering a home?  Under 1b, did Zimmerman have knowledge or “reasonable suspicion,” a standard for all law enforcement to adhere, an unlawful act by Trayvon?

Under 2c, was Zimmerman engaged in an unlawful act in stopping Trayvon?  Under a recent Illinois court decision, HOA security officers could not stop and detain people.

It is under paragraph 3 that the police have apparently chosen to see and to ignore all else.

So, is the Sanford Police Department the tail wagging the dog of justice?

————————————————————————-

(1) A person is presumed to have held a reasonable fear of imminent peril of death or great bodily harm to himself or herself or another when using defensive force that is intended or likely to cause death or great bodily harm to another if:

(a) The person against whom the defensive force was used was in the process of unlawfully and forcefully entering, or had unlawfully and forcibly entered, a dwelling, residence, or occupied vehicle . . . .

(b) The person who uses defensive force knew or had reason to believe that an unlawful and forcible entry or unlawful and forcible act was occurring or had occurred.

 

(2) The presumption set forth in subsection (1) does not apply if:

(c) The person who uses defensive force is engaged in an unlawful activity. . .

(3) A person who is not engaged in an unlawful activity and who is attacked in any other place where he or she has a right to be has no duty to retreat and has the right to stand his or her ground and meet force with force, including deadly force if he or she reasonably believes it is necessary to do so to prevent death or great bodily harm to himself or herself or another or to prevent the commission of a forcible felony.

What is an HOA’s duty of care liability to its members and to all others?

State laws, in general, hold that the duty HOA board of directors is one of good faith, and as a fiduciary or prudent person with respect to the members, where “members” does not mean an individual member.  This is based on the nonprofit, membership corporation and HOA/condo Acts that can be found in almost every state.

But, what about tortious or wrongful acts under tort law negligence, or agency law, or real estate law on an owner liability for injuries to others on his property?  And there is also the charitable volunteer laws shielding all but grossly negligent acts by volunteers.   These laws apply although you can’t find them in your CC&Rs or in the HOA/condo statutory Acts, and the average board member probably has very little, if any, awareness of their applicability to HOAs.

I write as a lay person, because no one else is writing and the national lobbying organization is not likely to tell it like it is — nothing bad about HOAs.  Not even any of your state consumer protection agencies.  With respect to the Trayvon murder incident, I wrote about some of these HOA liability issues in, “What is the HOA liability for wrongful acts by its security officers?”   Information has come forth in the media that the Retreat at Twin Lakes, the HOA, either “hired” Zimmerman or at least had knowledge, or should have had knowledge, of Zimmerman’s history.

My initial research into the question of HOA duty of care under tort law of negligent acts revealed a few court cases that shed some light on this question.  The most recent case (The Landings v. Williams, No. A10A1956, GA App. 2011) is the mauling by an alligator of an 83 year old woman on the common property of the HOA in Georgia.  The woman was visiting her family and is an “invitee” (legal term pertaining to a third-party on property held out to the public), and the appellate court denied a motion for reconsideration and upheld the HOA to have a duty of care and was negligent in this instance.

In California, several related cases have been reported by attorney Jeffrey A. Barnett in “Aberrant Behavior in Associations.”  He references the California Supreme Court holding that,

the owner’s duty to provide protection from foreseeable third party crime has always been determined in part by balancing the foresee ability of the harm against the burden of the duty to be imposed . . . . The board can be liable for failure to take reasonable steps to prevent injuries from foreseeable criminal activity.  (Isaac’s v. Huntington Memorial Hospital,38 Cal 30 112 (1985)).

The Court further held (Frances T. v. Village Green Owners Assn., 42 Cal 3d. 490 (1986), “that a homeowners association has a duty to exercise due care for the safety of residents in those areas under the association’s control.”  And that,

the property owner’s duty includes exercising reasonable care to discover whether criminal acts are being, or are likely to be, committed upon the owner’s land. If an investigation would in all probability lead to the discovery of prior similar incidents to the occurrence giving rise to an injury, constructive knowledge of such incidents is imparted to the property owner, and the owner may be liable for the damage resulting from the criminal activity.  (Phillips v. Perils of Pauline Food Production, Inc., 35 Cal.App. 4th 1510 (1995).

The HOA board cannot be allowed to justify negligence of this magnitude in the Trayvon slaying by claiming that they are just poor unpaid volunteers working for the community.  No!  HOA boards must be held accountable like all other government officials and entities.  Our public officials and entities are not given absolute immunity, and neither should that be given to HOA boards.