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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.

Suppose I park on an HOA public street. Then what?

Dear Arizona Legislators,

I cannot fathom the continued refusal of the Legislature to put this bill into law, having failed to do so for the past four years — SB 1360 (2007), HB2724 (2008), HB 2034 (2009), HB 2153 (2010).

 

This refusal to pass this bill invites more and more senseless litigation that only benefits the HOA lawyers, who should be advising their HOA of its violation of the law rather than willing go off to court against the member. Suppose I park my car on a public street in Sun City, or Sun City West, or Anthem, perhaps in front of a board member’s home. How will the scenario unfold?

 

  1. Nothing happens, and everybody lives happily ever after Not likely, since these HOA members have argued over the years before legislative committees for their right to stop this parking.

  2.  Some HOA member, presumably a board member, or his “hired gun”, the management firm, call the local/county police to evict me. I ask the officer his name, rank and serial number, and just what law I am breaking parking on an unrestricted public street. If he persists on getting me to move, I say to him this is harassment and you are violating the law, and wrongfully acting to evict me. If he says that I am creating am nuisance, I reply that he is the person violating his authority and acting on behalf of a private person/organization who is filing a false complaint. I ask him to arrest the HOA member for filing a false complaint.

  3. Does the HOA fine the member for not “policing” his street segment, under which he has no legal authority to do anything but plead and beg me to move? If so fined, then I have no sympathy for any homeowner who allows his board to engage in establishing such “laws”, presumably under the advice of the HOA attorney.
  4. In effect, all this posturing is an illegal extortion of the HOA member to violate the law under the threat of a fine, as the HOA and its attorney know better than to undertake such an illegal enforcement action themselves.
  5.  The HOA member has the right to file suit against the HOA, if he believes that the HOA “law” is illegal, contrary to public policy or unconstitutional, and he may do so. The Legislature will honor his beloved CC&Rs contract, between the member and the HOA, and not third-parties, and do nothing, leaving him to happily pay his fine as a good, loyal HOA member.
  6. If the HOA does not fine the member, what is their real issue, except the power struggle of who controls and regulates the people within the HOA territorial subdivision. All these HOAs have to do is to go to their zoning board and get a variance. Why aren’t they doing it?   Why?

  7. Suppose 10 other cars are so parked throughout these HOAs. Then what?

 

 You may ask why hasn’t this happened? Perhaps because:

  1.  homeowners are law abiding,
  2.  they do not understand or know their rights under the law since there is a broad “no negatives about HOAs” policy pervading the state,
  3.  there is no “Truth in HOAs” law like truth in lending or truth in advertising,
  4. and they are intimidated by their HOA with its coercive fines and liens authority, without effective legal recourse to stand up to the HOA with its money and attorneys.

  

This sad and preventable state of affairs, creating divisiveness, hostility, anger and resentment only benefits the HOA attorneys who are all too eager to go to court — their reason for being. All because the Legislature has failed to uphold the Arizona Constitution and to pass this bill.

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.

 

Analysis of AZ HB 2441, the HOA minority control bill

 

Opinion

This bill should not be heard in any committee!  

It is contradictory and confusing, and ideal for attorney involvement in the expected challenges to the interpretations of the statutes. Also, it is definitely aimed at destroying any vestige of democratic governance in homeowner and condo associations. This bill denies access to the courts.

Introduction

The Carpenter Hazlewood Delgado & Wood blog of Jan. 18, 2011, written by Scott Carpenter, “HB2441 – CC&R Amendments,” argues: “This change would enable community association to change their documents without onerous approval requirements that count a failure to participate as a ‘no’ vote.” (Emphasis added).  The exercise of the democratic right to vote and to protect one’s private property is considered “onerous” by the CAI Legislative Action Committee co-chair, Scott Carpenter.

Carpenter’s Dec. 17, 2010 letter, titled  “Bad Documents,”  to CAI lobbyist DeMenna proposed a change in the laws.  The letter includes HB 2441, verbatim, under the title “Easier to Amend Bad Documents.”  This bill did not originate with the bill’s sponsors, but from the CAI lobbying organization that supports not you, the homeowner, but that legal corporate person known as the HOA.   The Sponsors are just the vehicle doing CAI’s bidding.

The title of the bill itself simply  reads:  “homeowners’ associations; declaration amendments,”  and the bill extends well beyond just changing the voting requirements to amend the CC&Rs.  Some of these changes are good for homeowner protection, but are offset by the draconian attack on homeowner property rights. CAI argues, in Carpenter’s letter to DeMenna, that the proposed voting procedure is just like public voting laws, but fails to provide the necessary public government protections, and ignores the legal fact of the private contract in operation here, the CC&Rs agreement. HB2441 is another top-down imposition of government interference, which otherwise in instances involving the protection of homeowner rights, is vehemently opposed by CAI.

As you read this bill, remember that the courts take the everyday meaning of the words used, and if not clear, or seemingly contradictory, the court will look to intent.  Courts have held that if word “x” was  not actually stated, then the drafters should have included word “x” if that was their meaning or intent.  Read the bill carefully as written, and think how your opponent could challenge the wording in the courts.

 

Analysis

The full document with its  detailed, 10-point analysis can be found at HB 2441.

What led to the AZ supreme court constitutionality challenge to HOA adjudication?

Ever wonder how and why this statute granting DFBLS the right to submit HOA disputes to an ALJ for adjudication was challenged as unconstitutional?

Chris Gelb filed her petition (08F-H088012-BFS, Apr. 22, 2008) with DFBLS citing violations of her governing documents, and  a violation of the duty of directors under Title 10, 10-3830, as well as a violation of §§ 6.12 and 6.13 of the common law Restatement of Servitudes (2000 ed.). 

In general, Sec 6.12 deals with the authority of the court to overturn board decisions, and 6.13 deals with duties of the board to its members.   Gelb alleged discrimination against her in regard to a landscaping issue –  the type of gravel chosen by the board.   Gelb lost on the legal technicality that  the  “no discrimination” covenant applied only to the CC&Rs and not to the Design Guidelines.  (Raises the question as to why the winners, Carpenter, filed the constitutionality challenge).

She lost the case on the governing documents claim, and the other two were dismissed as being outside  OAH jurisdiction. The broader issues of a rational and equal treatment of members found in both of the dismissed claims would have probably brought about a favorable decision.  

The superior court decision in Phoenix  Townhouse v OAH, DFBLS had just declared the statute before us as unconstitutional, and Jason E. Smith, the Carpenter Hazlewood attorney of record in both cases, jumped at the opportunity to obtain an appellate decision, using Gelb,  that would serve as precedent.  All as a result of the gravel chosen by the HOA board.

 
Justice will still be lacking without the ALJ being able to consider these two important areas of law affecting HOAs.