How legislative Rules committees abort democratic HOA reform bills

In the interest of public education on the functioning of state legislatures, this paper presents information on the rules governing state legislatures — using Arizona as a representative example — that affect passing bills into law.  I focus on the Rules committee’s powers to obstruct the voice of the people, and how it can prevent — kill — HOA reform bills by the actions of the political party leaders.

The powers of the Rules committee are undemocratic and authoritarian  in nature designed to thwart, apparently, the folly of the voice of the people.  We see the same undemocratic, authoritarian powers granted to HOA boards to an even greater extent,  The national lobbying group’s promotion of the “business judgment rule,” and acceptance by the courts, is a prime example.[1]

Exhibit 1 details the Rules powers that can prevent HOA reform bills, and any other bill not liked by the powers that be, from a hearing and vote by the full chamber — by the people’s representatives. As I wrote earlier[2], Arizona’s HB 2052, a bill that has in reality been killed in the Rules committee after unanimous approval by the House and Senate government committees, is a prime example of this misuse of authority.

The Senate Fact Sheet “intro” paragraph misrepresents the content of the bill:

“Expands statutory restrictions on condominium unit owners’ association and planned community association (HOA) regulation of political signs to include signs related to certain community activity. Prohibits an HOA from prohibiting door-to-door community activity”.

Of the 8 listed “Provisions,” 2 are technical, 2 relate to political signs, and 4 — given a short sentence in the “intro” —  expand on HOA restrictions and prohibition’s protecting free political speech and expression, in the HOA public forum,[3] as curtained in my earlier “Senate Protects” posting.[4]

. . . .

The Arizona Legislature, and each and every state legislature, is  not a sovereign that can do no wrong, but has duties and obligations sworn to under oath “to establish justice . . . and secure the blessings of liberty” for the people of its state. It cannot demand respect but must earn it through good deeds.  Passing HB 2052 into law would be a sign of good faith that would earn the respect of the people.

Exhibit 1.  Arizona Legislative Council publications

“In the Senate, bills are usually not “held” in the Rules Committee for partisan or political purposes; bills which go into the Rules Committee are almost always reported out. In the House, the Chairman of the Rules Committee can “hold” (read “kill”) a bill simply by not giving it a hearing. (p. 52).

“The options of the committee chairman are a) Hear the bill and vote on it, b) Hear the bill but take no action, c) Assign the bill to subcommittee, d) Not hear the bill.  (p. 39-40).”

“The Role of the Rules Committee,”  State Senator Randall Gnant, From Idea to Bill to Law (2000). (As of April 2021).

“Each measure is assigned to the Rules Committee of the house through which it is progressing . . . . The Rules Committees assess the constitutionality of the proposed legislation. Unless they are withdrawn or discharged, all bills must pass the Rules Committee before they are heard on the floor. (p.41-42).

“An Active Calendar of the Committee of the Whole (so called in both houses) consisting of bills the Speaker or President selects for consideration by the respective Committee of the Whole (COW).

“A calendar consisting of all bills and other measures that have been reported from the committees. In the House this is called the “House Calendar.”  In the Senate it is called the “Calendar of the Committee of the Whole.” These calendars are simply a list of bills and other measures that are ready for further action by the full chamber.” (p.42-43).

Arizona Legislative Manual 2003 Edition, Arizona Legislative Council (2003). (As of April 2021).

Notes

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^[1] See, Reorienting the HOA board: business judgment rule (2020).

^[2] See, AZ Senate protects HOA misconduct rejecting HB 2052; Arizona HB 2052 restores homeowner constitutional speech protections.

^[3] See court holdings: Calif. holds HOA elections as protected free speech public elections (2019); NV supreme court upholds HOAs as public forums (2021).

^[4] Supra n. 2, AZ Senate Protects.

Limited purpose public HOA board; slander; AZ HB 2052

This writing is not meant to scare homewners from expressing their political free speech rights regarding HOA governance issues, but to observe certain precautions.

I’m disturbed by the appellate court’s rejection of theappeal in Tarter v. Bendt with respect to limited purpose public figure immunity pertaining to complaints against an HOA. The homeowner’s  complaints consisted of verbal statements, written communications, and a newsletter.

If Arizona’s HB 2052 (to be voted on by the full House), as a start,  were law today I believe your outcome would have been favorable. In part, the bill  

Allows a member or group of members to organize to discuss or address planned community business, including the following: a) Board elections or recalls; b) Potential or actual ballot issues; c) Revisions to the community documents; d) Property maintenance e) Safety issues; or f) Any other community business or actions. (Sec. 1, 2)

(See more, Arizona HB 2052 restores homeowner constitutional speech protections).

My nonlawyer view is that the case was a harsh application of the laws in an instance of an entity that functions for all intents and purposes as a local government;  allowed to operate outside constitutional protections. It is not  an “as usual” slander/libel situation but was treated as such in a memorandum decision.

The crux of the opinion was,

The parties stipulated that Mr. Tarter, as the HOA president, was a limited purpose public figure. Thus, the Tarters were required to prove that Mrs. Bendt’s defamatory statements were “made with ‘actual malice’—that is, with knowledge that it was false or with reckless disregard of whether it was false or not.”

In spite of the homeowner’s loss, the case can serve as a hard lesson to other homeowners, warning them of the dangers of rambling against their HOA and board of directors,  as the Court saw it. It serves warning that ALL relevant issues be brought before the court at trial as they may not be allowed in an after-the-fact appeal.

The Court summarized the defamatory statements, as charged by the HOA,  consisting of:

The Tarters introduced evidence that Mrs. Bendt called Mr. Tarter “idiot,” “fool,” “spineless,” “disgusting,” “chicken shit,” “lowlife,” “low-class sneak,” “unethical,” “lazy,” “weak,” and “a complete fake” in front of fellow HOA members. . . . . Mrs. Bendt also disparaged Mr. Tarter’s legal education, insulted his alma matter, referred to him as a habitual liar, and unethical. Mrs. Bendt accused Mr. Tarter of violating his attorney ethical obligations, and wrote that he could be disciplined by the Arizona State Bar and investigated by the Attorney General (“AG”).

As the Court saw it, very important issues of compensatory and punitive damages were raised and found in favor of the HOA.  The court allowed large sums, totalling $1,500,000, for nonmonetary damages as harm to reputation and emotionsl stress, and others, so beware! 

Support HB 2052 to be soon voted in  the House COW; date to be set.

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HOA limited-purpose public directors and officers

I just viewed the live Arizona appellate  court oral arguments in Tarter v. Bendt (CA-CV 19-0703 (Ariz.App. Div. 1 (2019)) and found it very informative. I have attended AZ SC oral hearings before but not an appellate hearing.

Bendt’s (defendant homeowner) attorney did an excellent job given the fact that she wasn’t the trial court attorney.  I was very pleased to hear her arguments on limited-purpose public person that I missed over these years.  Her rebuttal on free public speech was excellent!  As you know I’ve posted a few cases on this issue that, in general, addresses the topic that HOAs are public forums subject to free political speech protections – you can criticize your HOA within limits.

A limited-purpose public figure is either:

“One who voluntarily becomes a key figure in a particular controversy, or one who has gained prominence in a particular, limited field, but whose celebrity has not reached an all-encompassing level.”

Two examples of holding HOA directors and officers subject to free speech doctrine can be found in Dublirer v. 2000 Linwood Avenue Owners Assn (NJ Supreme Court, 2014) and in Cabrera v. Alam (Cal. App. 4^th (2011).

This case, although involving an HOA president’s conduct, Tarter, who is also a lawyer,  is really an issue of defamation by the president against Bendt. The argument by Bendt’s attorney is that the HOA president is a limited-purpose public figure as described above and there was no valid defamation according to law —  no malice. Malice being defined as: knowing that it is false; or acting with reckless disregard for the statement’s truth or falsity.

It is very informative that anyone thinking of suing his HOA should watch the oral arguments and see how harsh and strict the court demands supportable and defensible evidence. And how your attorney must be able to respond to questions by the judges and arguments by the HOA.

A MUST VIEW AT  TARTER. (45 minutes; the last 5 minutes present the public forum argument by Bendt’s attorney).