HOAs undermine principles of democratic America

The immediate reaction to the title of this editorial comment from the vast majority of readers, is as I suspect,

Unbelievable, wild statement; No way; I love my HOA; the volunteers work for the community; the board of directors has my interests at heart; I can vote for the directors and on other matters, And anyway, I really don’t care, I’m happy with the amenities, facilities, and protection of my property value.

This blindness toward compliance with the US Constitution and the laws of the land can be traced to the culture of the HOA-Land Nation as I presented in Part 1 of The HOA-Land Nation Within America. As for the false argument that because members can vote for a board of directors makes the HOA democratic, ignores the reality of Cuba, China, Russia, North Korea and other countries where people can also vote for their leaders.  Voting alone does not make a democracy.

Other aspects of the HOA model of government that illustrate departures from public government, the Constitution and laws of the land can be found in the HOA-Land Nation publication: lack of oversight protections and the absence of a separation of powers, especially there is no independent judicial function for fair hearings; an absence of meaningful  penalties against acts of the Board amounting to absolute immunity; and inadequate fair election procedures as found in public elections.

In all practicality, the HOA private government is based on a business model and not a municipality model, and whoever described a business as being democratic?  As such, following the business model, the HOA is a one-party government; the party of the incumbents who control the selection of candidates, who can vote, and the election procedures designed to keep the establishment in power.

Here’s what Gandhi had to say about one-party governments and democracy. With the independence of India from British control in 1947, Mahatma Gandhi reflected on the dominance of the Indian National Congress Party over the newly formed government.

“[Gandhi] realized that a one-party system could actually be a no-party system, for when the government and party are one, the party is a rubber stamp and leads only to a fictitious existence.

‘Without free criticism and potent opposition, democracy dies.

‘Without political criticism and opposition, a nation’s intellect, culture and public morality stagnate; big men are purged and small men become kowtowing pygmies. The leaders surround themselves with cowards, sycophants and groveling yes-men whose automatic approval is misread as a tribute to greatness.’”

(The Life of Mahatma Gandhi, Louis Fischer, The Eaton Press, collector’s edition (1988, initially 1950).

The common culture within the HOA-Land Nation treats any criticism, any opposition, any independent thought not supported or approved by the board of directors as subversive. The members are inculcated into adopting and supporting this attitude and treat such views as harmful to the peace and harmony of the community.  Committees of members — opposing political parties – are attacked and treated with hostility. Free political speech and dissent is not tolerated.  

With 23% plus Americans living in HOA-Land, the HOA culture has had its effect on national, state and local politics; ignoring the Constitution and laws of the land are easily acceptable and do not constitute a problem for HOA members. 

HOA-Land Nation publication to aid constitutionality

The important question of HOA constitutionality has generally been avoided and given token lip serve by all interested parties: homeowners, homeowner rights advocates, state legislators, real estate departments, attorney generals, nonprofit private entities proclaiming a defense of the Constitution, and the media at large.

Even the renowned Wayne Hyatt’s[1] statement in 1976 went ignored.

“One clearly sees the association as a quasi-government entity paralleling in almost every case the powers, duties, and responsibilities of a municipal government.   All of these functions are financed through assessments or taxes levied upon the members of the community, with powers vested in the board of directors, council of co-owners, board of managers, or other similar body clearly analogous to the governing body of a municipality.”[2]

Clearly challenging the constitutionality of the HOA model of local government and legal scheme is well beyond past due. To correct this horrific and inexcusable oversight I have published, The HOA-Land Nation Within America,[3] a white paper, an exposé of the HOA legal scheme violations of the Constitution. The eBook and paperback editions can be found on Amazon.

This task of constitutional HOA reforms may appear overwhelming and almost impossible to achieve, but constitutional HOA reforms can happen. It will take tremendous effort and perseverance, and a “never give up” mentality. David Cole passionately makes this point[4]

“If Americans now and in the coming years insist that . . . our most fundamental values, including equality, human dignity, fair process, privacy, and the rule of law, and if we organize and advocate in defense of those principles,” we will succeed in bringing about the necessary fundamental and constitutional reforms to the HOA legal scheme in existence since the HOA “bible” was released in 1964. In order to accomplish this important task, “it will take a persistent civil society, a vigilant media, brave insiders, and judges and other government officials who take seriously their responsibility to uphold the Constitution. But first and foremost, it will take an engaged citizenry.”

The defense of liberty depends . . . on citizens engaging collectively to fight for the values they believe in. . . . The preservation of liberty through a written constitution . . . has survived . . . because ‘we the people’ have consistently taken up the charge to define, defend, and develop liberty in our own image, so that it reflects our deepest commitment , not just those of a privileged elite who do not represent us.”

It falls upon the homeowners in HOAs, as has always, to advance constitutional arguments that are valid and credible.    And that takes knowledge and understanding of the issues.  The HOA-Land Nation, and other of my publications and Commentaries, as well as those of others, provide the “ammunition” that will pass the valid and credible challenges to be expected from CAI and other lawyers, provided the arguments do not get bogged down in irrelevant arguments from the opposition.

CAI cannot handle a broad Bill of Rights challenge. Period!  I have never been challenged  by CAI because they well know that they are defending the defenseless.

Read the book, paperback or eBook, and spread the word.  Use it in those many HOA violations where state statutes support the HOA.  Work to hold seminars and conferences to openly discuss the issues raised in The HOA-Land Nation.  Expose their defense of HOAs, now!

 Notes

[1] Wayne Hyatt was a prominent figure in the promotion of HOA-Land as well as an important person in creating CAI in 1973, serving as its second president.

[2] I have extensively quoted Wayne Hyatt’s 1976 statement on HOAs as mini-governments, as cited in the 1983 California case, Cohen v. Kite Hill.

[3] I have concluded that there exists an HOA-Land Nation within America that is comprised of fragmented and local HOA governments across the country and have designated them collectively as “HOA-Land.”  The commonality of their declarations of CC&Rs, flowing from the 1964 Homes Association Handbook (ULI publication), their shared beliefs, values, traditions, and institutions qualify HOA-Land as a nation.

[4] David Cole, National Legal Director of the ACLU, Engines of Liberty, Basic Books (2016).

Protecting HOA political free speech on matters of general community interest

Should matters of concern and interest to the general HOA member-community be protected from suits designed to stifle participation in HOA governance?  Homeowners in HOAs should be protected from these suits, called SLAPP suits, just as the general public is protected in most states that have anti-SLAPP laws.

The question becomes: will the courts hold issues of HOA governance to be a matter of general public interest and concern?  A failure of the courts to do so puts HOA governments solidly into the category of independent principalities, where members are not permitted free speech on community public issues, especially about their governing body, the HOA.

The expected defenses are 1) that HOAs are private, contractual governing bodies not subject to the 14th Amendment protections, which the members have agreed to obey; and disregarding the Ruiz opinion above,  2) the local HOA community cannot be considered as a public body that is interested in and concerned with matters of public interest; it’s a local, private matter.

There are several California cases holding that HOA concerns amount to public speech because it affects the community at large.  The following are anti-SLAPP suits.

“A SLAPP suit (strategic lawsuit against public participation) is a lawsuit brought primarily to chill a party’s constitutional right of petition or free speech. The anti-SLAPP statute was enacted to prevent and deter lawsuits that chill the valid exercise of the constitutional rights of freedom of speech and petition for the redress of grievances and provides “an efficient procedural mechanism to obtain an early and inexpensive dismissal of nonmeritorious claims” arising from the exercise of those constitutional rights. . . . . The resident’s front lawn is a public forum for purposes of the First Amendment. . . . Moreover, it is now well established that the anti-SLAPP statute protects private conversations as well as those occurring in a public forum.” (Santa Barbara).

“’Public interest’ within the meaning of the anti-SLAPP statute has been broadly defined to include, in addition to government matters,  ‘private conduct that impacts a broad segment of society and/or that affects a community in a manner similar to that of a governmental entity.’ (Ruiz; according to California statutes).

[My emphasis]

“[W]e hold the trial court properly determined the anti-SLAPP statute applied because the evidence showed the alleged defamatory statements were made “in a place open to the public or in a public forum” and concerned “an issue of public interest. . . .  The two locations where the alleged defamatory statements were made–at the Board meetings and in the Village Voice newsletter [HOA] –were open to the public and constituted “public forums.” Additionally, because each of the allegedly defamatory statements concerned [*11] the manner in which a large residential community would be governed, they concerned “issue[s] of public interest.”  (Damon).

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).”  (Damon).

My quick survey of state anti-SLAPP laws shows AZ, IL, HI, GA and MD as having strict laws relating to only issues before the legislature or a law, as petitioning rights.  A host of other states contain the much broader right to file an anti-SLAPP suit for issues of public interest. They are: CA, FL (as of 7/2015), IN, LA, OR, RI, TX, VT, and WA.  Check current status.

Case references:

  1. Santa Barbara Beach Club HOA v. Freeman, 2d Civil No. B212972 (Cal. App. 2nd 2010)
  2. Ruiz v. Harbor View CA, 37 Cal.Rptr.3d 133 (2005)
  3. Damon v. Ocean Hills [an HOA], 102 Cal.Rptr.2d 205 (2000)

Sun City HOA: a real independent principality

Sun City, AZ. a renowned retirement community, is an unincorporated town under the governance of the Sun City HOA (SCHOA).  It does not qualify as a planned community or as an HOA under the state’s statutes. SCHOA is a private nonprofit corporation — no mayor & no town council, governs it.  A sort of a throw back to the times when the sovereign, the king, issued charters or grants of authority to private organizations to conduct business or to govern new lands.

In modern times, does the nonprofit corporation charter by the state, the new “sovereign” of a republic, truly grant a nonprofit corporation the right to function as the legitimate government of a sub-division of the state?  This could not possibly the intent of the corporation statutes since the state abounds with municipal corporation statutes — cities, towns, special districts, etc. — and with methods and procedures for incorporating new towns and cities.  The appeal of direct democracy, local government control or “home rule” is understood, and agreeing to be governed by a business form of government under corporate laws could be viewed as a strong desire for independence from unwanted influences and intrusions.

Sun City is indeed such an independent government, not answerable under state municipality laws or the Constitution, as it is not subject to the planned communities statutes. Sun City is just subject to the broader corporation statutes that were in no way written to establish a democratic form of political government.  This sort of independent principality status has more in common with a tribal society where the inhabitants of the village are loyal first and foremost to their tribe and village, and to the leaders of the tribe, than to their state or country.

This tribalism reveals itself as the Sun City HOA does not require mandatory assessments, yet each deed requires that the owner make mandatory payments to another nonprofit, the Recreational Centers of Sun City (RCSC).  And in order for RCSC to qualify for common area real estate tax treatment, all owners “must be obligated to pay mandatory assessments to maintain and manage the common areas.”    Consequently, to accomplish this reduced tax basis without having to be subject to state planned community laws, a separate agreement is required to be signed by the owner agreeing to pay, not the HOA, but RSCS dues.  This is extraordinary, since the deed itself could simply require mandatory payments to a bona fide HOA that would own and manage the common areas, as is the case with a genuine HOA.

The strong desire to independent of state laws, yet to use them as above, required an amendment to the common area valuation statutes, ARS 42-13402 et seq., adding the “must be” clause above in 2000 (Ariz. Sess. L. Ch 196; HB1251).  What could have possibly been the intent of this statute other than to bestow a gift upon Sun City, an unincorporated community, tax benefits amounting to an estimated $113,000 per year, or $1,130,000 over the past 10 years?

Today, the residents of this independent “principality” are coming once again before the legislature, with the SCHOA attorney (a member of the national pro-HOA lobbying group, CAI), to deny the state its legitimate right to regulate and control the public streets within Sun City (HB 2153).  Suddenly, parking has become a safety issue in spite of the fact that, from the very beginning, the county planning board approved these alleged unsafe streets, and legal mechanisms are available to SCHOA to obtain variances on a case-by-case basis.

Don’t buy it!  Sun City is demanding complete freedom from the state with no interference into the “internal affairs” of their principality.  State cooperation, provided it is consistent with the aims and goals of Sun City, however, is acceptable and welcomed.