Getting the Feds involved in HOA reforms

As apparent from the Illinois Supreme Court opinion[i] favoring HOAs, the Feds need to get involved. However, the Feds, like state attorney generals, have no specific authority to get involved – HOA/condo states are state laws, except for those federal laws like the American Disabilities Act and Fair Housing.

A broader approach is necessary in order to wake up the Feds, and that can come about by an appellate or US Supreme Court case decision on 1) violations of a homeowner’s constitutional rights, or 2) a violation of the 14th Amendment’s equal protection clause brought under federal law § 42 U.S.C. 1983, Civil action for deprivation of rights. This approach would be similar to the whistle blower law suits of Erin Brockovich or Jeffrey Wigand (tobacco nicotine is addictive).

Read the paper at constitutional rights . . . .

 

[i] See IL Supreme Court holds HOAs “are a creature of statute,” and not contractual.

IL Supreme Court holds HOAs “are a creature of statute,” and not contractual

Last month the IL Supreme Court opinion in Spanish Court[1] reversed the right of an owner to withhold assessments in view of the HOA’s failure to fix and maintain.[2] In its argument, frequently making use of pro-HOA activist and CAI CCAL attorney in Florida, Gary Poliakoff, the Court stated,

 

Although contract principles have sometimes been applied to the relationship between a condominium association and its unit owners based on the condominium’s declaration, bylaws, and rules and regulations . . . the relationship is largely a creature of statute, defined by the provisions of the Condominium Act. . . . Although these duties may also be reflected in the condominium declaration and bylaws, as they are in this case, they are imposed by statute and exist independent of the association’s governing documents. Accordingly, a unit owner’s obligation to pay assessments is not akin to a tenant’s purely contractual obligation to pay rent, which may be excused or nullified because the other party failed to perform. ¶ 21.

So much for the sanctity of the CC&Rs contract! The Court, guided not only by Poliakoff, but by a CAI amicus curiae brief,[3] rolls with the punches and chooses when and when not to uphold the contractual nature of the governing documents.

The Court avoided dealing with the equitable aspects of withholding assessments just like withholding rent, rejecting the favorable appellate decision that held,

[T]he obligation to pay assessments, and the obligation to repair and maintain the common elements, as mutually exchanged promises, and concluded that under principles of contract law, a material breach of the repair obligation could warrant nonpayment of assessments. ¶ 7.

Adding fuel to the fire, the Illinois Supreme Court followed the CAI propaganda that the HOA’s survival depends on assessments being paid immediately and without question.

This section [of the IL condo act] was adopted to provide a constitutionally permissible, quick method for collection of assessment arrearages. . . . The necessity of a “quick method” for collection of past due assessments, unencumbered by extraneous matters, is manifest when we consider the manner in which condominium associations operate . . . . the condominium form of property ownership only works if each unit owner faithfully pays his or her share of the common expenses. When a unit owner defaults in the payment of his or her assessments, the resulting forcible entry and detainer action is thus brought “for the benefit of all the other unit owners.” ¶¶ 29 -30.

Permitting a unit owner’s duty to pay assessments to be nullified would thus threaten the financial stability of condominium associations throughout this state. . . . For the same reason that taxpayers may not lawfully decline to pay lawfully assessed taxes because of some grievance or claim against the taxing governmental unit, a condominium unit owner may not decline to pay lawful assessments. Trustees of the Prince Condominium Trust v. Prosser, 592 N.E.2d 1301.” ¶ 32.

 

Here we have the alleged dicta [non-supported court opinions], and becoming part of the Illinois public policy, that the survival of the HOA/condo is first and foremost. The HOA rises to the same level as a public entity, with the questionable governing documents now having contractual validity and court support to deny homeowner rights, freedoms, privileges and immunities.

 

Welcome to the New America of HOA-Land.

References

 

[1] http://www.state.il.us/court/Opinions/SupremeCourt/2014/115342.pdf.

[2] See appellate decision Court decisions: HOA Enlightenment Movement vs. the Dark Ages.

[3]Spanish Court Condominium Association II vs. Carlson (Illinois),” CAI Amicus Curiae Activity 2013.

Defending the Constitution: VA, yes; AZ, no

With the removal of the statutory imposed right of an HOA to fine members from Virginia’s  HB 791, the VA legislature demonstrated that it stood behind the separation of powers doctrine of the US and VA constitutions.

I had written VA Rep. Suorvell and Senator Petersen, who opposed the bill as it was written, about the Virginia Supreme Court’s findings in Gillman v. Unit Owners, which said HOA fines were unconstitutional.

In Gillman the Virginia Supreme Court held,

We do not agree that it was ever the intent of the General Assembly of Virginia that the owners of units in a condominium be a completely autonomous body, or that such would be permitted under the federal and state constitutions. Admittedly, the Act is designed to and does permit the exercise of wide powers by an association of unit owners. However, these powers are limited by general law and by the Condominium Act itself.

The imposition of a fine is a governmental power. The sovereign cannot be preempted of this power, and the power cannot be delegated or exercised other than in accordance with the provisions of the Constitutions of the United States and of Virginia. Neither can a fine be imposed disguised as an assessment. . . . We think it clear that the Gillmans were being punished, not assessed, and hold the action of the Association to have been impermissible.

 And very importantly from a constitutional point of view (my emphasis), “A condominium restriction or limitation, reasonably related to a legitimate purpose, does not inherently violate a fundamental right and may be enforced if it serves a legitimate purpose and is reasonably applied.”

Sadly, the Arizona Legislature is still trying to pass for a 4th and 5th time (two versions of last year’s trice defeated HB 2371/SB 1454).  It would allow unlicensed and untrained HOA property managers to represent HOAs in small claims court and in administrative hearings;  but not allow the homeowner a third-party representative, violating the equal application of the laws and no special laws for special groups provisions of the US and AZ  constitutions.

What is the legitimate AZ government purpose to selectively deny homeowner equal representation?  Does it reasonably promote good public policy?

Published in: on March 7, 2014 at 3:35 pm  Comments (7)  
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Whether apathy or anger, it’s always the HOA owner’s fault

The policy of the pro-HOA forces, including your state legislature, is to hold the homeowner at fault for problems in his HOA.  Never the HOA government itself.  Owners are apathetic and should be more involved in solving HOA issues, they argue,  but when owners join they find that their minority position has no power against the clique.  And if they react with anger against repeated outright violations by the board, they are again the problem people who just can’t get along.  Never the HOA government itself.

Many of us, who are involved in attempting to make changes in the public arena have encountered failures by our elected officials to provide fair and just HOA laws. And after a number of years begin to walk away with a harsh understanding that you can’t fight city hall.  There is nothing any different with the similar behavior of HOA owners facing the same public government failures with their HOA government.  They just can’t fight HOA city hall, too.

On the other hand, a number of homeowners react in the other direction by getting angry with the repeated frustrations with the failures of their HOA. With the lack of a viable means to correct these flagrant violations and unjust powers cast in concrete as CC&Rs and pro-HOA laws, what can you expect of good people?  So they get angry, shout, and become bitter at their treatment with no avenue for relief.  They are charged with abusive behavior, harassment, and bullying by the HOA. But, it’s never the fault of the HOA government itself.  Never.

The position of the pro-HOA forces has been, in my view: if the owners would only follow the rules all would be fine. Their position is that the HOA government works in the best interests of the community for everyone.  And that the best interests of the community rests in the unquestioned obedience to the HOA government.  Or suffer the consequences.

Like any other totalitarian government or banana republic, the HOA has the power to destroy your life by taking your home, by imposing harsh monetary penalties (fines), by curtailing your free use of the common property, by denying your right to vote as if you were a criminal of the HOA, and by ostracizing you and your family before the community. To drive you out of your home.  But, it’s never the fault of the HOA government itself.  No, never.

Of course, as with all dictatorships and banana republics where there are loyalists — those who support and defend their government — so, too, do HOA governments have their loyal supporters.  They have bought into the system and refuse to accept anything to the contrary. But what kind of community are they defending? Surely not a democratic system that surpasses that of the US Constitution.  It’s only common sense.

Published in: on February 22, 2014 at 1:19 pm  Comments (5)  
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Letter criticizes CLRC rewrite of Davis-Stirling (HOA) statutes

Below are excerpts from my January 30th  4-page letter to CLRC.

“I read Ms. Vanitzian’s LA Times column of December 29, 2013, Attempt to Simplify California Condo Laws Ends in Confusion and your response contained in MM14-09. As you may be aware I commented on her article in two parts. . . .  If you are looking for facts, allow me to introduce a few.  I recall Susan French’s study in 2000 (H-850), at the request of CLRC, that started the ball rolling ‘to clarify the law [and] establish a clear, consistent, and unified policy with regard to formation and management of these developments.’ 

“Still, much of her report aside from the need for clarity, Part II, sections C and D, called for protections of homeowner rights and a bill of rights statute in the rewrite of Davis-Stirling. . . .  Whatever happened to the proposed ‘Chapter 2, Members Rights, Article 1, Bill of Rights,’ (MM06-25)?

“There was my letter (MM05-25s1) arguing for the need for this equal rights chapter, to which you answered with, ‘Beyond the scope of this project’ even though French had recommended protecting homeowner rights. . . . It is obvious that this rework by stakeholders without meaningful homeowner input easily leads to clarifications and simplifications as interpreted solely by this group, from its perspective, which would not protect the homeowner. The new D-S cannot be seen as the result of an unbiased effort and with integrity.

“The approach used by CLRC has the smell of corporatism, the rule by a handful of corporations.  It is a form of government that flows from fascism as defined by its founder, Italy’s Benito Mussolini, Il Duce.  ‘Fascism combats the whole complex system of democratic ideology, and repudiates it . . . . Thus understood, Fascism is totalitarian, and the Fascist State . . . interprets, develops, and potentiates the whole life of a people.

“CLRC responded with, ‘However, a bill of rights would probably go beyond the substantive rights that are currently provided in the law’ (MM05-03), but in the next sentence dismissed the US Bill of Rights as non-existent substantive law. The obvious answer – as there were a number of published books, papers and journals from nationally recognized researchers and political scientists relating to this issue – was to recognize that indeed HOAs were de facto governments and to subject them to the Constitution.”

****

The cry “no government interference” while accepting HOA private government interference is irrational.  This acceptance of undemocratic, authoritarian HOA government with less protection of individual rights and freedoms than public government is a rejection of the Constitution, the Declaration of Independence, and the Bill of Rights. These people have lost their common sense!

Neither CLRC nor CAI will go down in history as Heroes of the American Republic, but perhaps may be remembered as Heroes of HOA-Land

The complete critical letter can be found at MM14-09s1.

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