The acclaimed and illustrious homeowner association expert, Wayne S. Hyatt, wrote on the need to reinvent homeowners associations in a September 2008 John Marshall law review article. This was somewhat surprising since Hyatt was an early Community Associations Institute (CAI) president in the 70s, and drafted several HOA declarations here in Arizona. Hyatt is also attributed with classifying HOAs as “mini-governments.”
Hyatt acknowledges the need for reinvention of HOAs with efforts
to reconcile community associations’ negative aspects [that] requires a candid admission that negative aspects exist” [and that] many [members] will be irritated by restrictions on property rights that the government traditionally protects. Residents will expect rights and processes as experienced in the public realm.
Yet, as shown by the Arizona declaration of unconstitutionality of OAH due process for HOA disputes, our government believes in supporting HOA restrictions that governments normally protect, rather than providing the expected public realm protections. The state is at fault, too, for failing to inform the public of their loss of rights and freedoms that comes with living in an HOA, while having the audacity to permit local communities to mandate such authoritarian subdivisions.
Hyatt, and others, have acknowledged that HOAs are a “sui generis”, that is, a one of a kind thing, not a public government and not a typical private nonprofit entity. “Analysts miss the essential point: community association law is a sui generis, essentially quite new, and predominately judge-made law that is itself evolving.” And it has been this judge-made new law over the past 44 plus years, argued and supported by such illustrious “legal-academic aristocrats” like Hyatt, all real estate/land use lawyers, that has resulted in an overwhelming pro-HOA decisions that can be found in the third edition (2000) of the Restatement of servitudes.
The article also addresses those questions of constitutionality and state actions that I have repeatedly raised over the years. Hyatt writes,
This is particularly true when the conduct prohibited would be constitutionally protected if the regulation were imposed by a government. The basis for these arguments generally is that the actions of the community association constitute “state action” on one or more of several theories. These theories are generally referred to as “judicial enforcement,” “sufficiently close nexus,” “symbiotic relationship,” or the “public function” theory.
Unfortunately, Hyatt reveals his true affiliations and beliefs, and rejects application of constitutional protections and state actions in his proposed “resolutions.” He prefers the violation of state constitutions approach, which is the preferred CAI approach because, as the national special interest lobbying organization, CAI dominates state legislatures. And the legislatures make the pro-HOA laws. A CAI lobbying committee exists in every state of the union! Just recall the defeat of last year’s HB2824 and SB1162 attempt to level the litigation playing field, and the superior court default decision on unconstitutional OAH adjudication.
Sadly, Hyatt did not address those fundamental questions that I had raised earlier, and that need to be addressed so we can proceed with a solid legal foundation:
1. Can a legislature delegate its functions, not government services but functions, to private entities without oversight or compliance with the Constitution, as required of all government entities?
2. Can private parties enter into contractual arrangements using adhesion contracts and a constructive notice consent, which serve to regulate and control the people within a territory (an HOA), within the state, to circumvent the application of the Constitution?
3. In 2009, should HOAs, as a sui generis private government, be held as state actors under the US Supreme Court criteria as a result of state protective statutes reflecting a cooperation, support or coercion; a symbiotic relationship; a close nexus; or an entwinement between state and HOA?