Private HOA adjudication is constitutional

The New America: Private homeowner association adjudication is constitutional, but administrative law court adjudication is unconstitutional. Say again?

Allow me to recall that I fought to be allowed to intervene in the Arizona superior court Merrit case that declared the Office of Administrative Hearings (OAH) adjudication of HOA complaints a violation of the separation of powers doctrine. An incredible slap at justice took place when I was ignored and orders given to the Clerk not to accept any further submissions from me. (Not even allowed to accept evidence of irregularities as to the standing of the alleged plaintiffs). This was a disgraceful act, especially when the courts lean backward to permit intervention in constitutionality cases. It was further disgraceful knowing that the courts place a heavy burden on the plaintiff to clearly show unconstitutionality, yet the courts still denied my intervention in this default decision. (My detailed filings and history can be viewed at The State of Arizona will not protect buyers of HOA homes!).

Was the establishment afraid that I would have had a public forum to raise these never before raised issues of constitutionality with respect to the HOA legal scheme itself? That I could finally ask questions in a public forum and wait for answers to my questions? The questions that no one cared to address. This was denial of my right to a hearing since I, and all other homeowner living in HOAs, was affected by Judge McMurdie’s broad decision. It was so unbelievable, so surreal. No government entity or official had come forward to defend the two year-old statute. Not only was it a gross travesty of justice, but an unethical decision violating the judiciary’s reported purpose to “secure the just . . . determination of every action.” (Ariz. R. Civ. P. 1); “a judge should not be swayed by partisan interests, public clamor or fear of criticism” and “A judge shall accord to every person who has a legal interest in the proceeding . . . the right to be heard according to law.” (Code of Judicial Conduct, R 81, Cannon 3(B)(2) and (B)(3), respectively).

I find it so laughable when an administrative law court that adjudicates disputes was found to be an unconstitutional delegation of legislative powers, yet a private regime’s adjudication of disputes is deemed OK, and ignored. Yet, there has been no delegation of legislative powers to any HOA regime! And, no one sees anything “funny” about this. It is obvious that the establishment sees no problem that a group of individuals can subvert the constitution and create private governments that adjudicate disputes, but delegation of such authority is required if the government gets involved. Go figure! The constitution has been turned on its head.

Furthermore, adjudication of disputes where there are obvious “industry interests” (the HOA in this instance) involved to preclude a fair hearing is one reason why independent administrative courts were established, separate from the control by any state agency. But, the legislature and the courts see no evil, hear no evil, speak no evil with this special “consideration” of HOA regimes. No, its those administrative courts that get in the way, not the HOA regimes. Welcome to the New America!

My main argument, as filed in my mandatory brief to the court as a Pro Per (see State of Arizona link above), was that there was no requirement for regulation stated in the cited cases, which were used as a basis for the decision, in order to validate a constitutional delegation of authority. The Administrative Procedures Act (APA), regulating state agencies themselves at the federal and state levels, and administrative law courts (like OAH) are longstanding legal doctrines.

Continuing my research for an expected reopening of the statute to permit OAH adjudication, I missed a very important argument in my brief. What does “regulation” mean? It does not only mean the authority to make rules for an industry by an administrative agency. Under the fundamental police powers doctrine to promote the general welfare, etc, regulation of the people and industry fell to the states and their legislative lawmaking long before administrative agencies entered into the picture in the 1930s.

The courts, including Judge Downie in the superior court Waugaman case that was used as the only argument in Merrit, focused on bona fide regulation, but only in terms of rulemaking (making “regulations”, which is referred to as binding administrative law). Understand that the DFBLS enabling act, see below, did not refer to existing statutes to enforce since there were none. In sharp contrast to the DFBLS act, the HOA enabling law, Ariz. Sess. L. 324 (2006), specifically granted DFBLS the authority to accept complaints and to adjudicate the existing statutes through OAH. The legislature said that it was in the public interest for an agency to adjudicate these HOA disputes subject to regulation by the named statutes.

We need to revisit this legislation and decision, either in the courts or before the legislature. The court decision cannot be allowed to stand as it is a gross miscarriage of justice.

Published in: on October 11, 2009 at 8:15 am  Leave a Comment  

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