Publications on HOA constitutionality and legal structure

Peter F. Drucker was an internationally renowned management consultant in the 50s and author of the management “bible,” The Practice of Management. “A classic since its publication in 1954, The Practice of Management was the first book to look at management as a whole and being a manager as a separate responsibility.” Bob Woodward you should know. 

View publications here: Amazon.com: George K Staropoli: Books, Biography, Blog, Audiobooks, Kindle

Questionable CAI/FCAR 2020 facts

My analysis of the data presented in the 2020-2021 Statistical Review and CAI Factbook for 2020 by the CAI affiliate, Foundation for Community Association Research, brings me to suspect the data.  I painstakingly extracted the raw data as presented and subjected it to my own analysis using an EXCEL spreadsheet.  Almost immediately a very disturbing result appeared that should have been obvious to a statistician as highly unlikely.  Of the 27 top states by number of  HOA organizations, my analysis revealed a fixed 3.3% of Volunteers to HOA residents for the state. Restated, each state showed 3.3% of all HOA residents as CAI volunteers.research

From a point of view of statistics, events and activities generally follow the normal probability curve, more or less, but when there is no variation then the conclusion is that some other factors are at play that produced the result.  The normal distribution is the most important probability distribution in statistics because many continuous data in nature and psychology displays this bell-shaped curve when compiled and graphed.  For example, if we randomly sampled 100 individuals we would expect to see a normal distribution frequency curve for many continuous variables, such as IQ, height, weight and blood pressure.

Consequently, this result should have been caught if it were some error, or if not an error then an explanation as to what caused this highly unusual result.  There was no explanation. Therefore the validity and integrity of the Statistical Review is suspect. The data used to generate the results cannot be accepted as a factual free choice representation of the underlying reality.  To repeat, the “error” is too obvious not to  have stood out and been corrected. As such, the entire factsheet is suspect, and probably earlier factsheets as well.

Looking for some rational explanation, I then looked into the possibility that the Top 27 states were somehow different from all the states so I examined a random 5 states, one from each corner and one from central US.  They, too, showed this suspect 3.3% ratio.

My research also revealed  the percent of HOA residents to the total US population as 21.1% and 22.4% (a variation ascribed to intermediate rounding of numbers and not significant). CAI has touted the number as 25% – 27%,  also in 2019, but in 2016 the number was in line with the 22% figure.  I cannot explain how this CAI number was obtained.

Hopefully, CAI and FCAR have an explanation.

For the mathematically inclined, the EXCEL spreadsheet (PDF) can be viewed. http://pvtgov.org/pvtgov/downloads/2020 data analysis.pdf

In case you were wondering about my background in statistics, I have taken courses in statistical analysis in psychological research, product marketing  (MS Management), participated in a queuing theory analysis of computer messaging throughput for international wall street firm, set up the methodology for the calculation of business sales for business brokerage industry, and analyzed the TV show, Deal or No Deal, probabilities of winning the million dollar prize (see starman.com website).

Advocate HOA practical education webinar

After viewing Raelene Schifano’s first webinar I was impressed with her detailed knowledge and involvement in HOA issues. Her education series dealing with the nitty-gritty of HOAs is much needed and should be helpful to the average HOA homeowner.  She’s undertaking practical and knowledgeable proactive steps toward HOA reforms. While based in WA state, I strongly believe all concerned homeowners seeking information from an advocate and not from your HOA or its attorney, especially if he’s a CAI member, to listen up.

From her promo:

HOA Fightclub302

“I will offer this educational series every Saturday, August 14th at 11:00am CST. I allow everyone to participate and offer solutions. Hope to see you there.”

Why HOA members fail in court – failing to know the enemy

In Nuclear Verdicts, not specifically addressing HOA cases and speaking to defense attorneys, author and defense attorney Tyson sees the failure to succeed  as a failure of the defendant to get angry.  “YOU are the solution to what has been wrong with our legal system.”  In keeping with the mission of a homeowner advocate’s cry of “fightclub,” Tyson’s Nuclear Verdicts’  mission “is about fighting individuals and groups who are attempting to take advantage of our legal system.  There are people every day who make false and exaggerated claims . . . .”   

I have applied his general statements to HOA-Land.  Tyson is quite on the mark with the many instances of HOA attorney conduct in the courtroom.  And on the failure of homeowners to appropriately and strongly respond. “Bad lawyering [on the part of the homeowner’s attorney] is much more common” than the HOA attorney’s “stretching their claims beyond what is real and verifiable.”  The homeowner attorney  “is surprised, or unprepared, or just not as good as the” HOA attorney. Tyson sums it all up with, “So how do you fight injustice? First of all you need to get angry! You need to stop complaining and do something about it.? 

. . . .

I have read dozens of trial and appellate court cases and opinions across the states, and have personally witnessed the conduct of HOA attorneys and board members in court. My research is consistent with Tyson’s position. I offer my own views for those seeking to go to court to take heed of, and to just DO IT!

My conclusions as to why homeowners lost in court fell into several causes, the chief being the failure to know the enemy, as Sun Tzu wrote in the Art of War. Other causes, as I saw them, 1) insufficient evidence and documentation provided to the court, 2) failing to state a claim, in other words, the HOA broke no laws or violated the governing documents but just exercised its discretion as was its right, 3) attorney lack of expertise and knowledge of HOA  case history, and 4) member afraid to argue the case as warranted for one reason or another.

I possess, as well as on other advocate websites including CAI’s pages on it amicus briefs and case history reviews, a wealth of information on knowing the enemy. Failing to provide this information to your attorney that will enhance your chances of success and to lessen his “learning time,” saving you money, can harm the chances of your winning in court.

YOU are the solution to what has been wrong with our legal system.”

I’d like to thank Sonia Bendt for understanding this need to cooperate and work together, and who sent me Tyson’s book realizing it would be very helpful to all homeowners going to court.

Robert F. Tyson, Jr, Nuclear Verdicts: defending justice for all, Law Dog Publishing (2020).

CAI’s early awareness of HOA constitutionality, public mini-government

It appears that CAI has adopted a “see no evil, hear no evil, speak no evil” attitude toward HOA constitutionality and public mini-government issues that are still prevalent today.  And it spread to the policy-makers.

Wayne S. Hyatt’s 1975 Emory Law Journal article, Condominium and Home Owners Associations:  Formation and Development, 2 years after the formation of CAI, presents his highly influential view on HOA constitutionality while recognizing that HOAs are mini-governments.

Wayne Hyatt “the most prominent advocate in CAI” serving as a 1975 “homeowners representative” and a former president (1978-79) (Privatopia, p. 219, 138 respectively). Hyatt  devoted his practice to working with developers of condominiums, master planned communities, resorts . . . to create community governance structures and community stewardship organizations.

While actively practicing law, he was also a member of 1) the American Law Institute (that wrote the pro-HOA Restatement of Servitudes, 2) the College of Community Association Lawyers (CAI affiliate) , the Community Associations Institute (CAI, created in 1973 by the National Association of Home Builders [grant of]  $30,000), and  3) ULI – the Urban Land Institute (sponsor of the 1964 “HOA bible,” The Homes Association Handbook) and served as a ULI Trustee.

He also served as an Advisor 1) to the Restatement of the Law (Third) Property: Servitudes, and 2)  to the Special Committees on a Uniform Condominium Act and a Uniform Planned Community Act of the National Conference of Commissioners on Uniform State Laws (Uniform Law Commission, UCIOA and UCA).  Hyatt received several awards from CAI.

Hyatt developed many of the Dell Webb’s master planned and resort/active adult association CC&Rs over the years.

His 1975 Emory Law Journal article gives readers a good idea of constitutionality and local government concerns that seemed to have evaporated over the years as CAI’s influence increased dramatically.  A few important excerpts:

  • “The California Code provides for an association and affords it the powers and duties of the mini-government.” {T]he [Georgia] legislature has in effect provided a large measure of home rule for what is in essence a category of small municipalities, and each has established a system of officers and directors in the nature of a mayor and council to oversee the exercise of this rule.” (At 988). 
  • “‘Has the state permitted, even by inaction, a private party to exercise such power over matters of a high public interest that to render meaningful’ constitutional rights, private action must be public?”(Footnote 33 at 983). [In simple terms, private government HOAs must be subject to local government protections].
  • “The Declaration is not a contract but, as a covenant running with the land, is effectively a constitution establishing a regime to govern property held and enjoyed in common.  It further sets forth procedures to administer, operate, and maintain the property. . . . the declaration and particularly the by-laws create not only a corporate structure but also a governmental authority that requires and deserves competent, experienced persons . . .” (at 990).
  • “The power of ‘levy’ is a distinctive characteristic of the association and removes it from a mere voluntary neighborhood group. . . . The imposition of penalties, whether fines . . . or a denial of use of facilities enforced by injunction, certainly represents quasi-judicial power to affect an individual’s property rights. . . . The possession and exercise of such power has substantial consequences with clear constitutional implications.  The courts have not yet considered a direct constitutional challenge to an association’s action.” (at 983).
  • “[T]he constitutional issue is most acute in rule enforcement; however the association’s established procedures, declaration, and by-laws should insure compliance with at least rudimentary constitutional principles, and there must be a procedure to protect members’ rights.” (at 984).

Nowhere will you find any equivalent discussion of HOA constitutionality, or HOAs as mini-governments or as a form of local public government. Not in its Manifesto, Community Next 2020 and Beyond (2016);  not in its Public Policies: Private Property Protection, Government regulation of Community Associations, and Rights and Responsibilities For Better Communities (July 15, 2021).

And not in any of its anti-constitution amicus briefs: Twin Rivers NJ appellate (2004), Dublirer NJ Supreme Court (2011);  Surowiecki, WA Supreme Court (2021) (business judgment rule overrides judicial review); Turtle Rock AZ appellate (2017); Foreshee WI appellate (2017).