Damn the American Flag!
Yes, that’s what many Homeowners Association boards in America are saying. And they’re suing to get rid of any trace of the Red, White and Blue.
You really have to watch this four minute speech by Texas Congressman Ted Poe!
Category Archives: privacy
The Problem With Private Police
Last year I ranted and railed about the Illinois Supreme Court allowing Homeowners Associations to hire untrained security guards who are allowed to make traffic ‘arrests.’ It was an idiotic decision because it put no limits on the police powers given to these ‘wanna-be’ cops. Anyone who’s covered news events for as many decades as I have knows that untrained guards cause many problems, not the least of which is unlimited liability to their employers.
Legitimate police officers are in constant training, their skills are always being honed, they’re repeatedly learning new law enforcement techniques, going to legal seminars and qualifying at the shooting range. Under the Illinois decision any 18 year old punk could put on a uniform, badge and gun, and even brandish an AK-47 if he so wished. There are no rules!
Now we read that it’s common practice in Homeowners Associations in Virginia. Fake cops there can even ‘invent’ fake police departments. After a number of incidents involving private cops, the Virginia Legislature is trying to give them some mandatory training.
But imagine the liability to the individual homeowner! A sex assault, a car accident during a chase, an accidental discharge of a weapon and a multi-million dollar lawsuit could be filed against the HOA that hired the fake cop. All those homeowners could be hit with special assessments to cover legal fees and liability judgments.
Very scary.
(link to Washington Post story on Virginia’s private cops)
Dallas Jews Face Yet Another First Amendment Fight
guest blog by Deborah Goonan
About a month ago, I wrote about Congregation Toras Chaim (CTC). With the help of Liberty Institute, CTC prevailed in a lawsuit filed by their HOA with regard to a dispute over deed restrictions limiting HOA homes to “single family use.” Based upon two Texas laws protecting religious freedom, a Colin County judge threw out an HOA’s case against owners of a home used as an Orthodox Jewish synagogue.
But that’s not the end of the story.
On March 2, 2015, the City of Dallas filed suit against CTC and the owners of the property at 7103 Mumford St, Mark B. and Judith D. Gothelf. The petition claims that the defendants have failed to obtain a Certificate of Occupancy (CO) required by the City of Dallas for all non-residential uses of property. The City insists that the property be brought into compliance with local ordinances before they will issue a CO for the property.
Specifically, the City explains:
“Currently, Defendants’ only permissible use of the Property is a single family use. Any other use of the Property that would require a CO [Certificate of Occupancy], such as the proposed use as a synagogue, without first obtaining a CO and complying with the life-safety requirements entailed therein, presents a substantial danger of injury or adverse health impact to persons and/or property of persons other than the Defendants.”
Curiously, the dispute over the CO and ordinance requirements stretches back to November 2013, not long after homeowner David R. Schneider filed his first lawsuit against the Gothelfs on the matter of deed restrictions in the McKamy IV and V HOA.
The City is now requiring that multiple modifications be made to the property, including adding 13 parking spaces, adding a firewall barrier between the first and second floors of the dwelling, and handicap accessible features including 2 wheelchair accessible restrooms on the first floor. The estimated cost to bring the Mumford Street home into compliance: roughly $200,000.
Attorneys from Liberty Institute, representing the Gothelfs and CTC have been back and forth with the City of Dallas for 18 months, initially arguing that the CTC is exempt from the City’s bureaucratic ordinance requirements based upon state and federal laws governing religious freedom. After all, they argue, the congregation of Orthodox Jewish families is smaller than most Christian Bible Study groups that meet in residential homes, without being required to comply with cost-prohibitive and unnecessary city codes.
The City claims they are within their legal rights to insist upon CO requirements, despite religious use status, state and federal law. The Congregation, through their attorney, then proposed a modification of their request, to ensure a maximum capacity of less than 50 occupants, but despite the good faith effort to compromise, the City has refused to back down on its requirements. In fact, every attempt of the CTC to compromise and avoid litigation has been rejected, or the City has changed the requirements yet again. The City now claims it will allow the defendants to formally request a special exception or variance, however if that request is denied, the modifications will have to be made within 14 days. If the deadlines are not met, CTC faces $1,000 per day fines for non-compliance.
According to the Rabbi, about 10 people attend daily religious study, and about 30 attend on the Sabbath, arriving on foot since their faith forbids driving on the Sabbath.
Also according to the Rabbi, the cost of extensive modifications combined with the cost of daily fines threatens the very existence of the Congregation. Its members would have to move to a different location within walking distance of their gathering place for weekly services.
Is it the City’s intent to protect religious freedom or to circumvent First Amendment rights by way of unreasonable enforcement of ordinances? And why has the City chosen to stop working with the Congregation and property owners now, on the heels of dismissal of the HOA’s case against them?
This battle for First Amendment rights is not over. The Liberty Institute has issued a statement that it plans to aggressively defend the religious rights of CTC.
“This outcome matters,” said Kelly Shackelford, Liberty Institute President & CEO.
“Any verdict that does not protect this congregation would be tragic. Not only for them, not only for Dallas, but for America. If small meetings by people of faith are not allowed in their homes, that would greatly damage religious freedom for all.”
(link to WFAA TV news coverage of suit filed by City of Dallas)
Differences Between Incorporated & Unincorporated HOAs
(drawn from different sources)
The law allows a homeowners association to be either incorporated or unincorporated. An incorporated association has a legal identity that is separate from that of its members, just as Microsoft has a legal identity that is separate from its shareholders. Unlike Microsoft, which is a for profit corporation, an incorporated homeowners association is a non-profit mutual benefit corporation which means that its powers are limited to those normally associated with a homeowners association, and it is exempt from certain governmental fees and taxes.
Traditionally, homeowners associations have been incorporated to protect owners from responsibility for association debts, losses and liabilities. California law extends most of these protections to owners of unincorporated associations provided the associations have proper insurance. Under current law, the advantages of incorporation are some (very limited) additional protection from owner liability, ease of opening association accounts with certain banks and vendors, and qualification of the units or lots for mortgage loans from lenders that require an incorporated association. Balanced against these advantages are the costs of forming the corporation, the burden of annually filing a form with the Secretary of State, and additional procedural formalities such as having officers and directors, and conducting formal meetings. States other than California will have their own laws which could differ greatly.
An unincorporated association can be incorporated by its owners at any time. The process of incorporation involves amending the governing documents, preparing Articles of Incorporation, and filing with the Secretary of State.
Must the HOA have directors?
Incorporated associations are legally required to have directors. Unincorporated associations need not have directors.
Must the HOA have officers?
Incorporated associations are legally required to have at least (i) a chairman of the board or president, (ii) a secretary, and (iii) a chief financial office or treasurer, but, unless prohibited by the governing documents, one person may hold all of these offices. Unincorporated associations need not have officers.
IRS and tax liability?
If an association has lost its tax exempt status through a lapse in its non-profit status, the IRS can certainly begin looking at the money an HOA has raised from dues paying residents. Sun City Anthem in Las Vegas, even though legally incorporated as a non-profit, was hit with millions of dollars worth of fines and back taxes because it failed to declare money from its country club restaurant as income. It’s almost a sure bet that someone will be looking at the books of any HOA that loses its non-profit status.
Source: http://www.andysirkin.com/HTMLArticle.cfm?Article=17
Does an HOA technically need to be incorporated?
If the CC&Rs lay out the existence of the HOA, and each homeowner’s deed requires the homeowner to adhere to the CC&Rs, then it’s possible to have a defacto association that operates without the benefit of the corporate structure or protections.
Without being a corporation, what you’re left with is one big partnership. That means each homeowner is individually liable for anything the HOA does. If an employee, for example, sues the HOA for back pay or sexual harassment or discrimination, then every homeowner is equally liable as if they had been the employer. That’s because, just like in any business partnership, they are. That’s the nature of partnerships. Everybody is responsible for every other partner’s actions.
It may be that founding CC&R documents require the HOA to be incorporated. If so, ultimately, the homeowners can sue the officers to make them incorporate. In the end, it’s all up to the lawyers.
Source: http://www.dailyrepublic.com/business-and-real-estate/does-a-hoa-need-to-be-incorporated/
StoneGate Gets Its HOA Butt Spanked
guest blog by Dave Russell
For those of you who know me, messing with sick or disabled children is my biggest pet peeve. So when I heard the story about the StoneGate Homeowners Association, in Raymore MO and their board president Stacy Bayers, I did a little research. Now according to the Missouri Secretary of State’s Office, the StoneGate HOA was actually ‘dissolved’ back in 2009. I’ll get back to this later. For now, let’s take the story from the top.
Ella Schultz is only 6 years old and she’s battling cancer. The Make-A-Wish Foundation heard that little Ella wanted her very own playhouse. They contacted construction giant J.E. Dunn and that company agreed to build one in Ella’s backyard in Raymore, Missouri. They even used shingles to match those used on other homes in the neighborhood. .
What a touching story — a sick child and some awesome people who wanted to help out. That is until the HOA board officers reared their ugly little heads and threw a wrench into Ella’s playhouse. “I’m not at liberty to discuss that,” Bayers said Tuesday night when asked why it’s difficult to make an exception for Ella. “The proposed plan they’ve given us is a violation of our covenants.
KCTV 5 News (CBS) in Kansas City, has reported, “The StoneGate Homeowners Association is not in good standing with the Missouri Secretary of State’s office and hasn’t been properly registered for four years.” If you pull up the information on the Secretary of State’s website, it clearly shows that this HOA’s status is “Admin Dissolved –nonprofit.” Oh, say it isn’t so! I wonder how the reporters found out about this. No doubt one of those crazy anti-HOA people called them up.
So did the StoneGate HOA really have the legal right to deny the playhouse in the first place? You know, considering the HOA appears to have been ‘dissolved.’ Can this HOA legally enforce any of their governing documents? Has this HOA been illegally operating as a not-for-profit corporation? Are they illegally collecting assessments, fines and placing liens on properties within their Association? As one would imagine, it’s probably going to take a lawyer and judge to figure this one out. This also makes one wonder if the HOA dues they took in over the past four years should be considered taxable income.
I guess you could call this a bad case of HOA KARMA. Now StoneGate HOA president, Stacy Bayers, is doing a little backpedaling. She issued this unbelievable statement last night. Really, it’s unbelievable.
”The board has met for the better half of the day and at this time we would like to release the following statement:”
“Our hearts are with Ella Schultz and her family as they battle this terrible illness. Our homeowners’ association board is committed to working with Make-A-Wish Foundation and J.E. Dunn to see if we can figure out a way to make Ella’s wish come true. The initial request from Make-A-Wish to place a barn-style shed was not accepted because the board did not have enough information to grant an exception to the subdivision’s covenants. In hopes of getting enough information, we are requesting an immediate meeting with Make-A-Wish and J.E. Dunn Construction to work out a solution in the most expeditious manner possible.”
Oh, how nice of you Stacy Bayers, president of the StoneGate HOA, working so hard to make this little girl’s wish come true. I’m personally not buying a word of it! Neither is the rest of the world.
