Resurrecting the argument for a homeowners bill of rights

This demand for a homeowners bill of rights by homeowner rights advocates had its play back in the 1997 – 2008 period, some 10 years ago. There was:

  • the AHRC’s 1997 bill,[1]
  • Lois and Samuel Pratt’s 1999 bill,[2]
  • my 2000 address to the AZ Legislature[3],
  • the 2006 AARP bill of rights,[4]
  • and my 2008 “Members Bill of Rights” amendment to CLRC.[5]

And there are undoubtedly others that I missed. Deborah Goonan recently re-posted a 2015 article[6] speaking of no Bill of Rights and constitutional violations of the 14th Amendment.  In 2017 the California Legislature adopted a limited bill of rights dealing with member political free speech.[7]

A new look at homeowner rights is needed, one that takes a down-to-earth approach and focuses on the common CC&Rs covenants and bylaws that read like,

  1. If there are conflicts between the provisions of Arizona law, the Articles, the Declaration, and these By-Laws, the provisions of Arizona law, the Articles, and the By-Laws (in that order) shall prevail.
  2. these By-Laws [Declaration] may be amended only by the affirmative vote or written consent, or any combination thereof of Members representing at least 51% [67%] of the . . . votes in the Association.
  3. no amendment may remove, revoke, or modify any right or privilege of Declarant . . . without the written consent of Declarant

Over the years I’ve discovered that the courts have universally upheld the broad amendment covenant as generically stated in (2) above.  The basis of their decisions is the very dangerous and overly broad interpretation that homeowners agreed to be bound[8] by the CC&Rs and bylaws.   Note that (3) above carves out an exception for the Declarant that requires his explicit consent, while accepting the majority rule principle in regard to the members. But, this “acceptance” to be bound by majority rule violates a fundamental right of citizens in regard a governmental “taking” or eminent domain action.

In many instances the courts have required 100% consent when the amendment adds new covenants, covenants not found in the CC&Rs, the most notable being changing from a voluntary HOA to a mandatory HOA.  This would be inconsistent with (1) above that holds that the law of the land prevails, and which of course, the buyer also agreed to. But, CAI comes to the rescue and prevails in the courts that the CC&Rs and bylaws contain valid waivers and surrenders of fundamental rights, even to the extent of accepting implicit (not stated but presumed consent) waivers and surrenders as valid.

Hold on! It is long held legal doctrine that the surrender and waiver of these rights must be explicit, one by one. And that, under contract law, there must be a meeting of the minds with full consent and no misrepresentation in the buying process. I have concluded that,

Public policy today rejects constitutional government for HOAs allowing them to operate outside the law of the land. 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.

The point I wish to make is that the absence of any meaningful bill of rights that genuinely protects the rights of HOA members is ab initio (from the beginning) a rejection of democratic norms and institutions.  The HOA cannot, therefore, be considered democratic by any means regardless of the propaganda by CAI and other pro-HOA supporters.

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.

. . . .

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.[9]

Simply unbelievable!  (In face of subsequent advocate criticisms, CAI began speaking of HOAs as a business, and we are seeing more and more statements that when a homebuyer signed his real estate contract, he was actually investing in a business.  Unbelievable!  Shades of George Orwell’s NewSpeak from his novel, 1984, where people are indoctrinated to hold 2 opposing views at the same time, and be at peace.)

What is intentionally absent — yes, intentionally otherwise the renowned CAI layers would have to claim incompetency regarding the law – is a Homeowners Bill of Rights.  Can you imagine that if the HOA framers, those stakeholders, of the HOA concept had actually met and discussed with knowledgeable and informed public that there would be protections for homeowners?  Can you imagine?

What the absent, yet informed public, would have added was a Preamble to an Amendment to the CC&R that would have been like that found in the Bill of Rights:

 Preamble to the US Bill of Rights

“THE Conventions of a number of States, having at the time of adopting the Constitution, expressed a desire, in order to prevent misconstruction or abuse of its powers, that further declaratory and restrictive clauses should be added: And as extending the ground of public confidence in the Government, will best insure the beneficent ends of its institution:”

The basis for the BOR was a distrust of government and the need to further protect the people.  Regarding the HOA documents, the 9th and 10th Amendments, as applied to the HOA legal scheme, would prevent the broad interpretations that have been and are continuing being held by the courts.  No more generalities, except in favor of the members.  If it was good for America over 230 years, it must be good for HOA-Land!

Amendment IX

The enumeration in the Constitution, of certain rights, shall not be construed to deny or disparage others retained by the people.

Amendment X

The powers not delegated to the United States by the Constitution, nor prohibited by it to the states, are reserved to the states respectively, or to the people.

The 9th Amendment simply says that if it ain’t specified – enumerated — in the governing documents, it belongs to the membership.  No more broad interpretations of waivers and surrenders of rights.  The 10th Amendment simply says that if the members did not explicitly agree to certain HOA powers (delegated to), it belongs to the membership.

This is the argument and approach needed to get a Homeowners Bill of Rights accepted by state legislatures.  It should be a national campaign by all advocate groups in all states for their next legislative session.  There is time to organize and prepare.

 

References

[1] See “Short History” in co-opting the HOA “homeowners bill of rights”, Elizabeth McMahon, 1997.

[2] See A BILL OF RIGHTS FOR HOMEOWNERS IN RESIDENTIAL COMMUNITY ASSOCIATIONS (1999).

[3] Statement to AZ Legislative Homeowners Association Study Committee, 2000.

[4] A Bill of Rights for Homeowners in Associations, AARP HOA Bill of Rights, David Kahne 2006.

[5] Supra, n. 1. “CLRC” is the California Law Review Commission.

[6] Let’s Get Some National Attention on HOA, Housing Issues, Deborah Goonan, 2015 original post.  

[7] A California true HOA Bill of Rights (SB 407).

[8] For a summary of the issues regarding the agreement to be bound position, seeConsent to be governed, No. 4, HOA Common Sense: rejecting private government.  The notes contain very important authorities on this issue.  (In only one case did a court reject this position because it felt that the amendment exceeded the reasonable expectations of the homeowner.  For example, having part of their assessments go toward a private entity unrelated to the HOA).

[9] CAI CEO Skiba in his April 2, 2008 Ungated blog entry.

NJ HOA constitutionality bill – fair elections

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, accordingly. Herald.com (Cape May County NJ) 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.”

Bruce Land adds,

“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.”

Homeowner rights advocates in other states must follow this lead and fight for similar HOA constitutional reforms. Six major issues to be pursued can be found in HOA Common Sense: rejecting private government.

Consent to be governed, No. 4

Democratic elections, No. 5

Fair and just hearings, No. 6

HOA Boards can do no wrong, No. 7

Draconian punishment and intimidation, No. 8

HOA Governments in fact, No. 9

In general, on the question of the validity and legitimacy of HOA governing documents and pro-HOA state laws, read:  CC&Rs are a devise for de facto HOA governments to escape constitutional government.

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).

 

Fundamental government functions: public or private HOA

Last month I commented on The Goldwater Institute’s Local Liberty Charter by Nick Dranias, its Director of the Center for Constitutional Government. The title asked the following question: Whither goest local government? Restrictive HOAs or responsible public government? A “follow-up” question that was not raised is:

Disregarding the knee-jerk reaction by those opposed to government involvement, “private enterprise can do the job better than government”, why, in the face of the serious problems surrounding the restrictive covenant, private government HOAs, does The Institute believe that restrictive covenants will provide for a better government?

It must be understood that we are not talking about providing services, such as trash, utilities, etc., but the basic functions of a government itself. What then becomes of public local government? In essence, the very concept of public government becomes an anachronism, replaced by myriads of independent local “principalities” since our now antiquated concept of government does not permit it to interfere with these private arrangements. What becomes of that initial contract between the people and its government, commonly known and referred to as the US Constitution? What becomes of the protections of individual freedoms and liberties protected by the Constitution?

Are these the concerns of the homeowners living in HOAs — those people whom we are told actually prefer and “love” HOAs? Definitely yes! Just look at the HOA reform legislation of substance, other than those dealing with the day-to-day operations. You will see legislation that attempts to restore fundamental rights and freedoms and “equal justice under the law” to homeowners living in HOAs, that were taken away by special interest influenced legislation.

I congratulate Mr. Dranias, and Shu Bartholomew, for keeping HOA issues before the general public: the basic issue is private or public local government. However, I was disappointed that Mr. Dranias’ appearance on the On The Commons internet talk radio show this past Saturday did not address these important HOA constitutional concerns.

There was, though, a brief mention of a loss of constitutional protections in HOAs. In response to Shu’s concern for private security use of radar guns and the absence of constitutional protections found in the public domain (32 – 35 minute mark), Mr. Dranias gave a response that might have been missed by most listeners. He referred to the city “spinning out or spitting out” a private entity to handle functions that it wanted to unload that such an entity was an agent of the city and was “bound by the same responsibilities of the city.” He added that, “the city cannot avoid its constitutional restrictions by contracting.” He spoke of “if this is an inherent function of government and they chose to contract it out . . . that person would be subject to constitutional law.”

The key point here is that the state did not establish the HOA (court rulings so hold) and, therefore, these private governments are not subject to constitutional protections. Again, this is the reason why there is a strong visceral reaction by CAI to any mention that HOAs are de facto governments.

In response to my email to Mr. Dranias, I was told that he will be addressing the issue in a future report. I eagerly await this report, and I await his return to On The Commons to speak of these concerns.

Goldwater Institute: separate and unequal constitutions for HOAs

In reply to my Arizona Capitol Times Commentary of December 12th, Constitutional Center Director Nick Dranias believes HOAs are bona fide consensual relationships and regulating homeowners associations would “stand the Constitution on its head.”  (See Goldwater Institute: regulating HOAs “stands Constitution on its head”).

In the late 1950s the Southern states enacted a Poll Tax and instituted certain “tests” in order for citizens to be eligible to register to vote.  No federal or state laws were violated, since the states were permitted to determine the methods for registering citizens, so long as it was not based on race (15th Amendment).  Of course, the tax was set at a level very few Blacks could afford to pay, and among the test questions were such gems as (LBJ: Master of the Senate, Robert A. Caro, p. x, 2002).
Name all of Alabama’s 67 county judges.
What was the date that Oklahoma was admitted to the Union?
How many bubbles in  bar of soap?
While legal, these state laws were intended to keep Blacks from voting, and were plainly an unjust and unfair vehicle to support the will of the local power groups.  Today, we can ask about the intentions and use of privately developed HOA restrictive covenants, and the arguments by the legal-academic aristocrats promoting the supremacy of servitude laws over constitutional law:
Can private, contractual governments be used to  circumvent Constitutional protections?  If so, then what becomes of the Constitution?  Can the people opt-out of the Union?  President Lincoln didn’t think so, and Americans paid dearly to make that point.
The Goldwater Institute’s continued dialog on HOAs and the Constitution reflects the view of HOAs as independent principalities existing outside the Constitution, and thus establishing a new order for Americans, a New America of HOA-lands.