I have strongly and repeatedly argued that the HOA declaration of CC&Rs is a devise — a legal maneuver — by real estate interests to avoid the application of the federal and state constitutions to HOAs.
The word “may,” as found prolifically in HOA statutes, serves to legalize acts and powers of the private HOA entity in a round-about, subtle manner. Without the use of the “may clause,” an act of the HOA can be challenged as illegal even though it is stated in the declaration agreement that is treated as a contract. Thus, state legislatures avoid a constitutionally mandated enabling act that delegates authority to any agency or public-private entity.
The acceptance of home rule doctrine and statutes, by all states, would seem to negate any justification under judicial review for creating special laws for HOAs. Home rule offers an alternative measure to satisfy any genuine government interest, thus making HOAs unnecessary.
So it appears that businesses can fail as well as cities, towns and states but, heaven forbid, not the private HOA government.
Read the entire paper here.