Lost Constitution Webinar

Veritas para justitia

May 22, 2020 11:00 AM PDT

This FREE webinar dares discuss the CAI taboos!

The overall intent and purpose of this webinar series is the education and reorientation of HOA members, especially the board of directors, to long ignored issues of constitutional validity; issues that the public will not find in the multitude of materials and publications of that business trade group, Community Associations Institute, CAI.

Geo zoom

The reorientation project is the first step toward the understanding and acceptance of my Plan Toward the Restructuring the HOA Model of Governance; it requires an examination of the role and influence of CAI in supporting and promoting the HOA legal concept and model of government.

To participate you will receive an invite with a password giving the time and date of the session. You will need this info when you sign up for the session at webinar time.

To receive an invitation please respond to gks256@NYU.edu with “webinar” as the subject and the email address that you will use to participate

Reorienting the HOA board – fair elections

Mentoring: Reorienting the HOA board – fair elections

I cannot overstate the profound damaging effect of the boilerplate CC&Rs covenants – the HOA-Land fair elections doctrine — that define the highly inadequate process and procedures alleged to be fair elections and approved by the member. In a democracy, the fair elections doctrine is the means for the expression of the will of the people and the consent to be governed by the HOA’s members. It is the fundamental basis for a valid consent to be governed. Unjust BOD biased election procedures deny the legitimacy of the HOA-Land doctrine.

In Dublirer the NJ Supreme Court held,

Dublirer’s expressional activity was ‘political-like speech’ because it related to the management and governance of the common-interest community. . . . [Dublirer’s] message was akin to and should be treated as political speech, which is entitled to the highest level of protection in our society. . . . If anything, speech about matters of public interest, and about the qualifications of people who hold positions of trust, lies at the heart of our societal values. . . . We therefore find that the Board’s House Rule violates the free speech guarantee in New Jersey’s Constitution.[1]

In California the appellate court held,

A homeowners association board is in effect ‘a quasi-government entity paralleling in almost every case the powers, duties, and responsibilities of a municipal government’ (citing Cohen v. Kite Hill Community Assn).”[2]

Democracy Web[3] clarifies the importance of fair elections in a democracy.[4]

If consent of the governed is the most fundamental concept of democracy, its most essential right is that of citizens to choose their leaders in free, fair, and regular elections. Other rights are necessary to democracy; elections by themselves are insufficient. Yet the right to freely elect one’s representatives and to influence the political direction of one’s government is democracy’s indispensable political foundation.

Without free elections, there is neither the possibility for citizens to express their will nor the opportunity for citizens to change their leaders, approve policies for the country, address wrongs, or protest the limitation of their rights. Elections establish the citizenry’s and the individual’s political rights. They are the ongoing representation of the consent of the governed

As it stands HOAs cannot be described as a democracy, or a democratic business as CAI’s Tom Skiba(CEO) alleged,[5] so long as the current fair elections doctrine remains in place.

Community associations are not governments — many years of legislation and court rulings have established that fact beyond a reasonable doubt. Yet they are clearly democratic in their operations, electing their leadership from among the homeowners on a periodic basis.

In an unbelievable doubletalk and excellent example of the pot calling the kettle black and Orwell’s DoubleSpeak, Skiba asserts,[6]

The solution to that problem is not to replace democracy with tyranny, royalty, or some other form of government, but to work to make the democratic process better and to hold those elected accountable. . . .

I for one prefer the democratic principles that have served this country for more than 230 years, as frustrating as the process can sometimes be, rather than the various failed alternatives washed up on history’s shores.

In addition, while the appellate court upheld California’s HOA fair elections statutes,[7] the California CAI Legislative Action Committee opposed the decision in support of democratic functions in HOAs.[8]  And not unexpectedly, this “front-line” position is in conflict with the CAI policy:

Community associations are one of the most representative and responsive forms of democracy in America today. Residents of a community freely elect neighbors to serve on the board of directors of the community. Numerous other owners or residents  serve on committees and help with special tasks as they arise.”[9]

Simply unbelievable! Believable!

State legislation to reform HOA fair elections

I am well aware, and you may raise the fact, that state laws and CC&Rs vary quite a bit in regard to voting and director elections. Some say very little except quorum requirements and secret or mail-in ballots; some require independent elections committees and vote counters, or the right to view the ballots, etc. but they all hold true to the Handbook that places strong control within the hands of the BOD. This is especially true when the BOD must approve candidates or propose amendments or rules without real member participation and voice.

Attempts to correct these injustices are found in many states. I am pleased to see that 2 legislators (Assemblyman Bob Andrzejczak and Bruce Land) in the NJ Assembly understand HOA constitutional issues and have sponsored a bill, A-3163 (2013), accordingly. The Cape May County Herald[10] reports,

Homeowner’s Associations must operate under similar rules and procedures as other governing bodies,” Andrzejczak said.  “A resident’s interest and right to approve and elect board members must be preserved. And setting clearer, more fair and unified set of rules for board elections and a clarifying a resident’s ability to recall will help to do just that.

Homeowners living in developments are still consumers and must be protected under the law,” said Land. “Ensuring their right to fair elections and protecting their right to choose board members, who will make decisions on their behalf, is a measure of consumer protection that they simply deserve as property owners.

California’s SB 323 (2019) fair elections bill was made law stating, in part,

A member of an association may bring a civil action for declaratory or equitable relief for a violation of this article by the association. . . . Section (b) is modified to read, “A member who prevails in a civil action to enforce the member’s rights . . . the court may impose a civil penalty of up to five hundred dollars ($500) for each violation.”

Arizona’s SB 1412, making progress at the legislature, also seeks political content protections in HOA politics. It seeks to prohibit HOAs and condos from restricting political free speech. Members are permitted to associate, meet, discuss, show signs regarding political activity.  Key wording:

“AN INDIVIDUAL MEMBER OR GROUP OF MEMBERS MAY ORGANIZE TO DISCUSS OR ADDRESS PLANNED COMMUNITY BUSINESS, INCLUDING BOARD ELECTIONS OR RECALLS, POTENTIAL OR ACTUAL BALLOT ISSUES . . . .”

Why are these unjust and unconstitutional covenants, conditions and restrictions allowed to stand?   The misguided mission and vision statements meant to deceive; the failure to act in the interest of the members; the failure to reject the business judgment rule[11] that serves to protect the BODs over the rights of the members; and the employment of the inequitable HOA fair elections doctrine that deny a genuine consent of the governed.

The answer is obvious to those willing and able to handle the truth. The vast majority of the members have lost their freedom of mind.[12] They appear to be RWA followers[13] of the authoritarian[14] BOD. They have been thoroughly indoctrinated into the teachings of the CAI School of HOA Governance[15] where real estate attorneys provide advice on how to run the HOA and what’s good for the community.

All the more reason for this seminal position paper, Restructuring the HOA Model of Governance. All the more reason for a restructuring of the HOA model and a reorienting of HOA directors and officers to return lost constitutional principles.

 

Notes

[1] Dublirer v. 2000 Linwood Avenue Owners NO. 2011 069154 (N.J. 2014).

[2] Damon v. Ocean Hills, 102 Cal.Rptr.2d 205 (2000).

[3] Democracy Web emerged from the longstanding effort of the Albert Shanker Institute (ASI) and its founding organization, the American Federation of Teachers (AFT), to foster education for democracy in America’s schools. (Scroll down to About).

[4] Democracy Web,  scroll down to Essential Principles.

[5] Tom Skiba, Community Associations Institute Blog, Ungated, April 2, 2008.

[6] Id.

[7] Wittenberg v. Beachwalk HOA,  NO. G046891 (Cal. App. 4th Dist. June 26, 2013).

[8]Appeals Court Ensures Equal Access During Elections”, Blog of the Community Associations Institute California Legislative Action Committee, July 9, 2013.

[9] Section 8 in An Introduction to Community Association Living (2006),

[10] Herald.com (Cape May County NJ, Dec. 8, 2016).

[11] See Reorienting the HOA board: business judgment rule in the Plan.

[12] See “Cultural Dynamics of HOA-Land,” The HOA-Land Nation Within America (2019); HOA Social Dynamics — Freedom of mind pt. 1 (2020) George K. Staropoli.

[13] Robert Altemeyer, The Authoritarians, (2007).

[14] See HOA political dynamics: totalitarian democracy, George K. Staropoli (2019). “Followers submit too much to the leaders, trust them too much, and give them too much leeway to do whatever they want–which often is something undemocratic, tyrannical and brutal.” See survey on HOA authorianism,

[15] The foundation and principles of the School can be traced back to CAI’s Public Policies, The CAI Manifesto (its 2016 “white paper”), its numerous seminars and conferences, its Factbooks and surveys, its amicus briefs to the courts, and its advisories, letters, emails, newsletters, blogs etc. I have designated these foundations and principles collectively as the CAI School of HOA Governance.

CAI School faculty advice – managing HOAs

I have described the CAI School of HOA Governance in an earlier post. In short its programs educate and promote the biased CAI view of governing HOAs.[1] I consider the School’s faculty consisting of those learned professionals, real estate attorneys, CAI former Trustees and national Presidents and some misguided constitutional attorneys and nonprofit organizations.

The latest School pronouncements come from a highly respected real estate attorney that is deeply involved in CAI, Kelly G. Richardson.[2] In view of his background and publications, seminars and speeches, I consider him to be part of the of the CAI School faculty that sets CAI’s objectives, missions and programs. Note that Richardson’s profile shows no credentials or expertise to speak about corporation management or governance, or constitutional or municipal laws.

Yet he feels free to speak outside his expertise about HOA governance that I maintain is founded on real estate equitable servitudes, covenants running with the land, where “The policy makers have failed to understand that the HOA CC&Rs have crossed over the line between purely property restrictions to establishing unregulated and authoritarian private governments.”[3] Richardson, with all due respect, does not have the credentials to advise HOA directors on governing the HOA.

In his “Homefront: Fiduciary Duty” article[4] he takes the time to clarify in some detail, finally for the members, that the BOD (board of directors) acts in the interests of the corporation and not the individual member. That’s straight corporation law not HOA law. However, I’m confused by the following statement: “If the director were a fiduciary to the individual member, that pursuit of delinquency or violation would breach the duty of loyalty toward that member, but the loyalty is to the corporation.” Richardson seems to be saying that indeed a director has a fiduciary duty to the member but that duty to the HOA comes first.

Then he goes on to advise directors that a dissenting director, one who voted in the minority, owes his allegiance to the HOA and must muzzle himself.

“Even though the director believes the decision is a poor one, the director’s loyalty to the corporation compels the director to support and not frustrate the board’s decision.” This appears to be one of the fundamental flawed teachings of the CAI School, never go against the HOA or BOD. Never! It is contrary to all expert advise on effective and productive management[5] or city management.[6]

Richardson closes with advice on the need to conduct due diligence so the director can fulfill his duty to the HOA.

“The duty of care requires directors to have sufficient information from qualified persons to make the decision.” But then comes the plug for CAI, “Savvy directors know their role as directors is to make good decisions and not to advise, and so support hiring outside experts for advice.”

He further warns directors, who have relevant knowledge and expertise, to remain mum and not speak out least he be sued. If the director chooses to speak out as he should do in the best interests of the HOA, ”the director is not acting as a director but is an unpaid consultant and could be held liable for their advice.”

 Once again Richardson is advising directors to remain silent and to trust in the experts adding support to my earlier assertion, BODs, in general, resort to CAI not for legal advice on how to run the HOA government but as a crutch to allow them to dodge their obligations to govern the people.”[7] His managerial advice does not come from any credentials in political science, or constitutional law, or municipal government, but as a real estate professional espousing the CAI School of HOA Governance model of contractual, private, local government. In short, by fear mongering, it gives credence to the view that the HOA lawyers control the BODs.

Indoctrination “is the process of teaching a person or group to accept a set of beliefs uncritically.” Over the years CAI has been very successful in indoctrinating all the people: the policymakers, the state legislators, the state real estate departments, the media and the homebuyers. Richardson’s article justifies the need for a restructuring of the independent HOA principality and a reorienting the board of directors away from the CAI School doctrine.[8]

 Notes

[1] The foundation and principles of the School can be traced back to CAI’s Public Policies, The CAI Manifesto (its 2016 “white paper”), its numerous seminars and conferences, its Factbooks and surveys, its amicus briefs to the courts, and its advisories, letters, emails, newsletters, blogs etc. I have designated these foundations and principles collectively as the CAI School of HOA Governance.

[2] Kelly G. Richardson: CAI Board of Trustees 2011-2017; Community Associations Institute (CAI), National, President, 2016; College of Community Association Lawyers (CCAL), 2006; CAI’s California Legislative Action Committee, Chair, 2009, 2010; National Association of Realtors; California State Bar Association, Real Estate & Litigation Sections.

[3] See in general Restructuring HOAs: “CAI School and member benefits” pt. 2.

[4] HOA Homefront: Fiduciary Duty – What It Is, And Is NOT, The Public Record, (Feb. 26, 2020).

[5] See for example: Are You Creating ‘Yes Men’ And Hindering Your Own Leadership Success?”, Terin Allen, Forbes.com (Nov. 10, 2018). “In my experience, most people get this way because they are responding to a culture or people in management who elicit and reward this type of behavior. . . . [in order to] survive on a dysfunctional leadership landscape where all the signals and messages confirm for them that dissent is bad and agreement is good.”; “7 Ways “Yes People” Can Destroy Your Business,” Barry Moltz, American Express Company (May 27, 2013). “Yes people don’t tell the truth. They only tell the . . . business owner what they want to hear. This doesn’t help a leader, who needs the whole story, good and bad, to operate a business. It only serves to increase your vulnerability.”

[6] Orville W. Powell, City Management: Keys to Success, AuthorHouse (2002). Powell “is recognized in this country and internationally as an expert in the field of city administration.”

[7] See Restructuring the HOA model.

[8] See HOAs are in need of a major restructuring.

 

HOA representative government and consent of the governed

George Washington wrote in his Farewell Address (1796), the Constitution “is the offspring of our choice, uninfluenced and unawed, adopted upon full investigation and mature deliberation, completely free in its principles . . . .”  The Declaration of Independence asserted “that to secure these [inalienable] rights Governments are instituted among men, deriving their just powers from the consent of the governed.”

These two quotes contain the fundamental principles of representative democracy adopted by means of a social contract, the Constitution, which are freedom of choice, ”just powers,” and “consent of the governed.” By virtue of these fundamental principles of democracy, HOAs cannot be considered as democratic governments. Period!

In his article explaining the meaning of the Constitution,[1] Edwin Meese III explains that “consent is the means whereby arbitrary power is thwarted. The natural standard for judging if a government is legitimate [and hence just] is whether that government rests on the consent of the governed.” 

In order for HOA governments to be just, legitimate and compatible with the Constitution these fundamental principles must be honored and supported. HOA “constitutions,” those CC&Rs, are not compatible with the US Constitution.

Meese further addresses the differences between “consent of the governed” and “will of the majority” that is a pro-HOA mantra. “The ‘consent of the governed’ describes a situation where the people are self-governing in their communities . . . into which the government may intrude only with the people’s consent.”

He explains that the “Will of the majority” is a political mechanism for decisions to be made by the government. In other words, the BOD makes decisions on behalf of the members based on its view of the majority will or some survey of the members. In short, in a representative democracy, like that attempted by the HOA legal structure, not all of the members are in agreement with or consent to the decisions of the BOD. It raises the issue of ‘the tyranny of the majority’ when the minority is not given due respect nor the ability to freely and equally speak out on HOA governmental issues.

Meese contends that the Founding Fathers[2] understood this weak point in a democratic government and the need to “insure domestic tranquility.”[3]

[A] government [must rest] not only on the consent of the governed, but also on a structure of government wherein the views of the people and their civic associations can be expressed and translated into public law and public policy. . . . Through deliberation, debate, and compromise, a public consensus is formed about what constitutes the public good. It is this consensus on fundamental principles that knits individuals into a community of citizens.

The structure of HOA governance is not based on and contradicts fundamental American principles and traditional values.  Furthermore, the CC&R are not even based on contract law 101 with its requirements for freely entered into, full disclosure, and explicit agreement to be bound,  but on the real estate doctrine of equitable servitudes.

To learn more about your loss of these rights and freedoms see The HOA-Land Nation Within America.

 

References

[1] Edwin Meese III, “What the Constitution Means,” The Heritage Guide to the Constitution (2005). Meese was the US Attorney General under Ronald Reagan.

[2] See in general, The Federalist Papers, #51, James Madison who explained, “Justice is the end [goal] of government. It is the end of civil society.”

[3] Preamble to the Constitution.

So. Carolina HOA study committee misses the point

As a follow up to my “State legislature not concerned” commentary, the SC HOA Study Committee released its recommendations on HOA legislation.[1]   On the issue of, “Education for Homeowners and Board Members,” a committee member recommended CAI as a source for HOA education in general. Apparently, with all due respect, he is not fully aware of CAI’s history and its views on maintaining authoritarian private governments.

This property member representative offered, “Education is already available. According to one source, “CAI (Community Associations Institute) webinars offer specialized, professional training without leaving your home or office. . . . Homeowners should have reasonable access to an organization such as Community Associations Institute (CAI) or a knowledgeable State agency to obtain unbiased, accurate information.

Fortunately, the recommendation was not to have a private entity, including CAI, provide HOA education.

While the Community Association Institute (CAI) and other private entities offer educational resources to homeowners and managers, state government cannot place the sole responsibility of educating homeowners and board members on a private entity.”

The committee recommended that several state agencies “to seek reliable and unbiased information available from private entities and to publish and make such programs by private parties available online. So, the door is still open for CAI biased influence given the current climate that CAI is the only source and has no self-interest.

There is an abundant supply of information to inform the legislators of the true nature of CAI, its 42 year history of failure, and its policy to keep HOAs as authoritarian private governments.[2] But the problem is is to first educate the legislators in line with HOA Common Sense: rejecting private government. This requires a source to provide alternate perspectives on HOA governance: civil government, local government, constitutional law, and city managers.

A simple HOA bill would just have to say,

The association hereby waives and surrenders any rights or claims it may have under law and herewith unconditionally and irrevocably agrees 1) to be bound by the US and State Constitutions, and laws of the State within which it is located, as if it were a subdivision of the state and a local public government entity, and 2) that constitutional law shall prevail as the supreme law of the land including over conflicting laws and legal doctrines of equitable servitudes.

There is much to be accomplished in order for meaningful HOA reforms to occur. If advocates continue to fail to speak out and ignore, as I have urged, the principles of constitutional government as applied to HOAs, the outcomes over the years will also continue.

 “We must continue to provoke until they respond and change the laws.” Gandhi.

 

References

[1] STUDY COMMITTEE ON HOMEOWNERS ASSOCIATIONS, Dec.18, 2015 (http://www.scstatehouse.gov/CommitteeInfo/HomeownersAssociationStudyCommittee/HOAStudyCommitteeFinalReport12182015.pdf).

[2] See Will the real CAI standup: its contradictory beliefs, pronouncements and goals and CC&Rs are a devise for de facto HOA governments to escape constitutional government. In general see, Unconstitutional delegation of power to HOAs, HOAs violate local home rule doctrine and are outlaw governments; and Privatopia: Homeowners Associations and the Rise of Residential Private Governments, Evan McKenzie, Yale Univ. Press, 1994; Community Associations: The Emergence and Acceptance of a Quiet Innovation in Housing, Donald R. Stabile (Greenwood Press, 2000).