Category Archives: Colorado

Reflections on Flags

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Flag etiquette is a touchy subject in this country. The U.S. Supreme Court has ruled that burning the American Flag is a protected form of speech under the First Amendment. Still, we hear calls from elected politicians that displaying the Confederate Flag is not protected speech.

The beginning of the Confederate War was never about slavery, it was about the massive tax burden being imposed by the North against southern businessmen. The slavery issue arose two years into the Civil War and at that point the Stars and Bars and slavery were forever linked.

But the original flag, the one that George Washington commissioned, was never about slavery, either. It was about this country’s brash argument that it wanted to be free from foreign rule and oppressive taxes. Yes, George Washington owned slaves. So did many others of the country’s founders. So did the Cherokee Indians, for that matter.

So how is the American Flag any less a symbol of slavery than the Confederate Flag? The two flags are just red, white and blue pieces of cloth stitched together. And now professional rabble rousers are insisting that anything Red, White and Blue be torn down and assigned to the dustbins of history.

The two flags represent culture. There are good and bad things in every culture. But believing that Americans are too stupid to make up their own minds about important cultural issues is Political Correctness run amok.

Flee from political correctness, that apple barrel of hypocrisy and prevarication which is sitting and fermenting and waiting to poison the discussion and the common sense that most Americans have.

Now, we have a very real situation taking place in a Southern Colorado neighborhood. A Hispanic man hung a flag upside down as a show of disrespect because of the racism he feels in his community. He says he feels harassed by the HOA’s management company.

Whew! Don’t we all?

There’s a craziness afoot in American neighborhoods. There’s an intolerance that’s as insidious as a cluster of cancer cells. Let’s get rid of it. Leave the flags alone. Leave our First Amendment alone. If someone has the bad taste to display a flag improperly, just walk away and let him be. What a nice place this would be if we just gave each other some space. Forgive, forget, and get on with life.

(link to El Paso County flag story)

 

Great Proposed HOA Bill In Colorado

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Guest blog by Stan Hrincevich

SB 15-177 concerns proposed construction defects litigation in Colorado. No Bill is perfect and in the world of HOA homeowners’ rights we seize the moment for any reform especially when it reins in the influence of HOA lawyers, property managers, and abusive Boards. This Bill would require HOA homeowners to approve the use of HOA funds in litigation.

Homeowners would have to be apprised of any intended litigation, informed on the substance and estimated costs, the consequences of unsuccessful litigation such as special assessments, and how the lawsuit is to be financed. A majority vote would be required to use HOA funds. HOAs can still bring legal action for construction defects and individuals can still pursue legal action using their own funds.

The Community Associations Institute (CAI) and HOA lawyers hate this Bill as it reins in their mostly open and easy access to HOA funds for litigation by requiring homeowners to first approve of such action. This can save large amounts of money for homeowners and safeguard reserve funds that can now be used for lawsuits. The CAI’s latest and weak argument on this Bill contends a Board would require a homeowner to vote for legal counsel on everyday, routine matters but no such verbiage is in the Bill and this is called desperation. See the article below for more information.

Please take a few minutes to write your legislator asking them to support SB 15-177. If the content of the Bill changes to lose our support we will let you know. Your email does help and helps home owners. Get involved!

CAI Threatened If Homeowners Are Empowered

(article from HOAforum.org)

The Community Associations Institute (CAI), long incorrectly identified as a homeowner-centric organization in the press and by State legislators, is again attacking the idea of HOA homeowners’ rights. The CAI represents the interests of property managers and HOA lawyers and not homeowners. This time they are objecting to a provision in proposed Colorado SB 15-177 (construction defects) that requires HOA homeowners to approve the use of HOA funds in litigation. Why the opposition? The CAI and HOA lawyers view the HOA as a profit center and easy money. Empowering homeowners on how their funds are used considered disruptive and meddling.

Too often HOA lawyers raid HOA bank accounts for legal fees and costly legal cases that should never have been litigated. That leaves homeowners with depleted reserve funds, special assessments to pay legal costs, and/or increases in HOA dues to replenish reserve funds. HOA Boards can currently enter into litigation without apprising homeowners of their intent, the cost and consequences of litigation or how they intend to finance legal fees. Boards can incur unlimited legal expenses and even take out debt instruments to pay legal fees. Home owners in too many cases only know of the financial consequences after the case has been litigated and they are stuck with the bill. This Bill simply reins in the authority of an HOA Board (that is highly influenced by HOA lawyers and property managers) in making decisions on litigation that can have significant if not catastrophic financial impact.

SB 15-177 would not preclude legal action but require a majority of home owners to approve litigation. This would mitigate the number of law suits and the abusive practice of an HOA Board suing on behalf of a very few (as few as two) vs. the community at large. More cases would be handled in the less expensive legal venue of arbitration thus saving HOAs significant sums of money. Home owners could still pursue individual actions using their own funds.

The CAI is fabricating a tall tale in contending that any legal fees paid to an HOA lawyer related to routine advice and counsel would take a majority vote of home owners. This Bill doesn’t get involved in regulating or interfering with the operations and daily functions of the HOA. Legal counsel on enforcing covenants, controls, restrictions, and debt collection or other issues involving common and routine HOA issues would not require a majority vote of homeowners. It’s just not in this Bill. Payment of routine legal counsel doesn’t require a lawsuit today nor would it under this Bill. This Bill is directed at legal cases filed in a court of law that are specific, unique, non-recurring and financially impacting. The CAI is embarrassing itself by claiming that any payment to an HOA lawyer would have to be voted upon. Obviously, the CAI is desperate to kill this bill.

The winner in this Bill will be homeowners in HOA community associations, not the Community Association Institute. Homeowners will now have more control over how HOA assets are used. They will still retain the right to litigate construction defects. This Bill does not impair the ability of any HOA Board to govern but contributes to open governance.

 

Builders, Professionals seek to avoid liability for Construction Defects, with support from local and state government

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guest blog by Deborah Goonan

Colorado has been making news on HOA websites lately. In direct contradiction to Colorado state law, Lakewood city officials have recently passed an ordinance that prevents condo owners from suing developers for construction defects.

There are two sides to the issue of construction defects. Builders want to avoid litigation in lieu of binding arbitration, with the opportunity to correct defects. They maintain that defects are often minor, or that defects are a result of poor maintenance by the HOA, rather than shoddy construction.

Homeowners, wary of uncooperative Builders that may drag their feet taking corrective action, or may balk at making necessary repairs, are reluctant to give up their legal rights to sue in the courts.

But Builders have an ally in the form of the Colorado Metro Mayor’s Caucus, pushing for statewide legislation that reduces builder liability for construction defects. You see, the Mayors believe that reducing liability for construction defects will reduce building costs, and convince Developers to build new affordable housing in the form of condominiums.

Instead of working in the best interests of constituents, writing legislation with balanced legal protections for condo owners, proposals aim to gut existing statutory rights to file a lawsuit, requiring mandatory arbitration instead. Anyone who has been involved in arbitration knows that the filing costs are substantial, with results usually slanted in favor of Big Business.

Avoidance of liability for construction defects is a hot button issue, so much so that Colorado attorneys are actually encouraging developers and general contractors to include mandatory arbitration clauses in the Condo and HOA governing documents. Attorneys also recommend requiring Developer approval to amend (or remove) that arbitration requirement following turnover to an owner-controlled Board. (See link below)

Critics in Colorado point out that affordability is probably more affected by factors such as student loan debt and stagnant wages, rather than higher building costs involved with obtaining construction insurance.

Meanwhile, on the east coast, there are similar ongoing battles in my home state of Florida.

In Florida, the controversy centers on whether or not developers, general contractors, and design professionals should be liable for construction defects affecting common area infrastructure – roads, storm water drainage systems and structures, street lighting, and other essential elements – that affect the habitability of homes a the subdivision.

In response to Maronda Homes vs. Lakeview Reserve, where Lakeview HOA sought to sue Maronda for defects that resulted in storm water flooding and deterioration of roadways, Developers and construction firms sought to avoid liability for defects to common areas that are “unattached” to the homes, or that do not result in direct damage to individual homes. In 2012, the Florida Legislature passed, and Governor Scott enacted, FL Statute 553.835, preventing HOAs from filing suit to recover damages from construction defects to common area infrastructure. Attorneys and homeowners alike opposed this consumer-unfriendly legislation, but real estate development interests lobbied for its passage, and most state Legislators voted in favor of the amendment. The law basically states that homeowners are stuck with the cost of making repairs to defectively constructed roads, storm water ponds, swales, underground drainage, and the like.

“Too bad – Buyer Beware!”

However, in 2013, the Florida Supreme Court found that 553.835 shall not be applied retroactively in the case of Maronda v. Lakeview. The Court also left the door open for a constitutional challenge in defect suits brought after July 1, 2012, when the law became effective. The statute still stands, awaiting that challenge.

In the meantime, design professionals (architects, engineers, designers, surveyors, etc.) successfully lobbied for passage of their own protective legislation, FL Statute 558.0035, limiting individual liability for professional negligence claims.

Notice that nobody seems to lobby for quality construction, and protection of owners’ health, safety, or financial interests. Instead, Legislative focus is on reducing construction and legal costs for builders and related professionals. While it makes sense to inhibit frivolous defect lawsuits or fraudulent claims, it makes no sense at all to eliminate accountability of Developers and others who designed and created HOA subdivisions for personal profit.

Furthermore, it is outrageous that legislators continue to circumvent the judicial process by passing laws that limit the rights of constituents.

Florida references:

Florida Supreme Court rules that a homebuilder’s implied warranties apply to subdivision improvements that provide “essential services” to homeowners

http://www.lexology.com/library/detail.aspx?g=7c45caa0-800b-4874-b394-b8957310cb50&utm_source=Lexology+Daily+Newsfeed&utm_medium=HTML+email+-+Body+-+Other+states+section&utm_campaign=Lexology+subscriber+daily+feed&utm_content=Lexology+Daily+Newsfeed+2013-07-24&utm_term=

Florida Condominium Law Protects Condo Owners from Construction Defects

http://www.floridacondohoalawblog.com/2012/05/articles/construction-issues-contractual-disputes/florida-condominium-law-protects-condo-owners-from-construction-defects/

FL Statute 553.835 Implied warranties (effective July 1, 2012)

http://www.flsenate.gov/Laws/Statutes/2012/553.835

Florida Statute 558.0035: Limiting Design Professional Negligence – See more at:

http://www.jimersoncobb.com/blawg/2013/06/florida-statute-558-0035-limiting-design-professional-negligence/#sthash.4j7R4QnE.dpuf (effective July 1, 2013)

Colorado References:

Building lawsuits could be reformed

http://durangoherald.com/article/20141130/NEWS01/141139971/-1/taxonomy/Lawsuits-in-building-defects-may-be-reformed—

How to guarantee the HOA can’t litigate condo construction defect claims

http://www.lexology.com/library/detail.aspx?g=b768d3c2-c021-4701-83eb-59bdc1998b87

Not HOA Related, But Hilarious

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All you have to say to a New Yorker is the word, “Denver,” and they laugh.

Denver is a perennial punchline in the Big Apple. But we certainly do give them more than enough ammunition for their wicked humor.

A Denver bank robber was arrested within five hours of his crime. Yeah, this guy certainly should be considered a candidate for the annual Darwin Award.
He wore his nametag, John David Martinez, on his shirt. And his getaway car, a silver Honda sedan was registered in his name.

I’m still doing research, but I wondered if he could possibly be a board member in his Homeowners Association?

(link to story on stupid bank robber)

 

How Bizarre Are Transfer Fees?

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Activists in Colorado are gearing up to fight one of the most bizarre expenses on your closing papers when you sell your HOA home.

Most people have no idea what that mysterious charge is that appears on your real estate documents. Transfer? From who to whom? It’s a transfer of money from your pocket to the checking account of a ‘mysterious stranger’. The fee can range anywhere from fifty bucks to several thousand. Question the fee and your closing agent will just pack up her briefcase and leave.

Some transfer fees are set up by the neighborhood developer. The fee is mandated as a permanent kickback to him whenever a neighborhood property is bought or sold. Some argue that a perpetual fee paid to the developer effectively lowers the price he charges for developed lots or built-out homes. But it’s simpler than that. It’s a slush fund set up by the developer to benefit the developer. It’s welfare payments to millionaires.

Some activists in Colorado are trying to get the State Legislature to ban transfer fees. There actually was a law passed to ban such fees a few years ago, on all residential real estate… except Homeowners Associations.

Huh?

Yep, Homeowners Associations.  This one’s a little hard to explain. In Colorado the transfer fee goes to the HOA management company. It doesn’t go into the coffers of the HOA to benefit the neighborhood, it just slides into the pockets of the community association manager. Theoretically it pays for research into the status of the homeowner who’s selling his property, such as whether his HOA dues are up to date. But that means the homeowner is paying hundreds to thousands of dollars for the thirty second act of photocopying a piece of paper.

Why would any Legislature ban transfer fees on all properties except Homeowners Associations?

The answer may have to do with the CAI (Community Associations Institute). CAI pretends to be a benign organization set up to protect homeowners. But its actually a 55 billion dollar a year referral organization which lobbies against any legislation meant to protect the property rights of individual homeowners. And CAI is currently staging a massive lobbying effort to defeat any change in Colorado law. Now why would they do that?

Follow the money.

(link to opinion column in Denver Post)

(link to Colorado HOA Forum)