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HB2158 Interpretation

Hello Dennis, Things are heating up, the most recent action in our neighborhood being a letter to homeowners sent out by email blast from our HOA President using our Management Company as the distributer. In...
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HB 2158

Our Community is working to recall several Board members. As part of this effort, we have been posting flyers and posters around the Community to educate those who may not be aware of the activities...
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  • From Dennis Legere on city street parking in an HOA

    Mark,
    It sounds like you may still be under declarant control. It is my contention that the way the statute was written a grandfather clause was added but only until such time that either an original or amendment was recorded after 1/1/2015. Most HOA attorneys claim that only original recordings apply to the grandfather clause, but where ever the intent of the legislature was to apply only to associations created after a date they use a totally different expression. It is my belief that any amendment recorded after the prescribed date nullifies the ability of an association to regulate streets that do not belong to them. If you are under declarant control however all bets are off and the association is still allowed to control the streets as long as the declarant control is in place. But as soon as the declarant turn the community over to the association they can no-longer regulate the streets. The thing to remember is that neither the declarant or the association has no authority to set restrictions on the streets that they do not own, unless they have a contract with the city that allows them to regulate the streets instead of the city doing it. The declaration is not that contract because the only parties to that contract are the declarant, the association and the homeowners. The city never committed in any way to be subject to the declaration. You would have to challenge the restrictions in court but from my experience you have a very winnable case. I have never found any city to sign any contract or agreement for any association to manage and control their streets. The basic statute is public policy and any provision in any covenant that violates public policy as unconscionable is void and unenforceable. Any provision in the declaration that applies a restriction on property that they do not own or is not owned by anyone party to the covenants is unconscionable.
    Dennis

    Go to comment
    2022/11/26 at 6:23 pm
  • From Dennis Legere on Ideology of HOA Industry Lobbyists

    Nick,

    That provision is both applicable to condominiums and planned communities. Think of it this way, if a unit owner did something that damaged the common property who should pay for it the entire community or the unit owner that caused the damage. I think your answer will be the person that caused the damage. Which is exactly what the law provides for. The industry does not benefit from this at all. This really comes down to what is fair for the homeowners altogether.

    The problem is when the association board arbitrarily claims that one unit owner caused damage without proof or based on false reports from other homeowners, there is no true due process in these communities because the board get to add those charges to your account. Your only recourse is to sue the association for those false charges and prove your innocence.

    Reserve studies are reasonable applications of the fiscal responsibility of the board to manage and maintain the common property. Common sense within these communities is far too often a forgotten trait. It will be very unlikely that the state will ever tell the association to apply common sense or mandate that a specific type of reserve study must be conducted. Florida actually did that this past year as a direct result of the Condominium collapse, and that law has been devasting to condominium owners in the cost of not only the study by the mandated modification to the structures as a result of it. This is an example of the state stepping in and preventing the application of common sense by mandating that every association do something in the same way and then commit to the results of that study with mandatory maintenance activities. This made a lot of money for reserve study contractors and for construction trade groups all on the back of the condominium owners without any say in the process or the need for their individual communities. I will never drive to do anything like that in Arizona and will fight any attempt for state mandated process that does not direct benefit the homeowners. This does not mean that i don’t support reserve studies i’m just saying one size cannot fit the needs of each individual community and the community needs to figure out what works for them and not be told what to do by the State.

    Dennis

    Go to comment
    2022/11/23 at 10:57 am
  • From Rhonda Wakai on HB2158 Interpretation

    Thank you for the very understandable response. We want to do things correctly!!!!

    Go to comment
    2022/11/23 at 10:47 am
  • From Dennis Legere on HB2158 Interpretation

    Rhonda,

    For a planned community position of the board is consistent with state law and the bill from last year with one exception. The association is limiting a sign to no more than 3 sq ft and the law specifies an aggregate of 9 sq ft. So, you can have three such signs on your property not the one specified in the policy. Bulletin boards are referred to in the statute relative to notice of informal meetings of the members not political signs. The statute does not specifically address the leaving of flyers on other people’s property so that aspect of the restriction is correct. The association cannot restrict you from going door to door and speaking to homeowners or handing out flyers but not leave them at the door. The only thing that the statute allows you to post on bulletin board or common property is notice to informal meetings of the members. If that is what you posted then the association has no authority to restrict that use irrespective of anything to the contrary in the governing documents.

    Dennis

    Go to comment
    2022/11/23 at 10:39 am
  • From Priscilla Tramontana on HB 2158

    Thank you, Dennis. If I may, I would like to provide you with additional information. Our BOD is redirecting funds that only part of the Community pays, specifically for the exterior maintenance of those homes that contribute. The Board is taking those funds and putting them into Common Area maintenance. They have done this in the past, were taken to court, and lost. A permanent injunction has been in place since 2013 that details what those funds may and may not be used for (to be used ONLY for exterior maintenance and insurance of the contributing homes). We are pursuing legal action, which takes time. Is there anything we should/could do for more immediate action?

    Go to comment
    2022/11/22 at 8:36 am
    • From Dennis Legere on HB 2158

      Priscilla,

      Clearly your association has total disregard for the rule of law. You association and individual directors are in contempt of court and can be sued for that contempt in Superior court. Your legal action should not focus on the violation of the CC&R’s but rather on the contempt of court and name each individual board members that voted for this action as a defendant in the case. The board may believe that they are immune from liability for their actions and let a court case that only sues the association play out. By being named individually as defendants in a case they cannot win will change their tune very quickly and may be settled out of court very early on. Do not settle for anything other than a resignation of the existing board and a legally binding commitment to never run again and a complete restitution of the funds to where they belong and a commitment for the individual board members to pay for any legal expenses you incurred in bringing this suit. The only way to stop this total illegal and inappropriate use of these funds is in fact to sue the association and the individual board members that voted for that action for contempt of court. The board members will not be protected by their indemnification clauses and by the D&O insurance. and will have to hire individual attorneys to defend their actions. The association cannot use the association funds to pay for the defense of the individual board members for breach of duty and contempt of court.

      Clearly the first court order did not get their attention enough to sink in. This will and it will cost them dearly.

      Dennis

      Go to comment
      2022/11/22 at 3:54 pm
  • From Dennis Legere on HB 2158

    Priscilla,
    Any and all statutes relative to HOAs or Condos are only enforceable via a petition to the Dept of Real Estate and a hearing before an administrative law judge or in a suit in Superior court. This law is no different. Unfortunately, whenever any homeowner enters litigation to enforce the law the cost of that litigation is borne by the entire community and not the board or it’s individual directors. So, you are essentially suing yourself based on the actions of the board. Guess who thought up this scheme? CAI and the attorneys that make very good livings off the back of homeowners.

    If board members truly understood that they had a duty to the community to comply with the law and that they could be held personally liable for failure to do so we would not have this problem. That is why my highest priority bill this session will be to do just that. This bill will establish and codify into law the true duties of the board as already established in common law and case law for Arizona and to define accountability for the cost of litigation to any board member found in violation of those duties.

    You have a right of free speech relative to community ballot issue as established under HB-2158. Your board member has absolutely no right to restrict or intimidate you from expressing that right. Whether they like what you say or not. He is also free to post information defending the board actions. But remember what you say matters, and anything you say must be true to the best of your knowledge. posting knowingly false information for the purpose of defamation is slander and you could be held accountable for that.

    Dennis

    Go to comment
    2022/11/22 at 5:50 am
  • From Rhonda Wakai on Board Member Recall

    Thank you for this valuable information. We appreciate you so much!!!

    Go to comment
    2022/11/21 at 6:31 pm
  • From Dennis Legere on Board Member Recall

    Rhonda,

    There are no time limits for board recalls. I have no idea where anyone came up with that opinion. If you are an elected or appointed board member you are subject to recall. But if that recall fails you cannot be subjected to another recall effort for the remainder of your current term.
    Please remember not to waist a good board member by grouping them with board members that are not working in the best interest of a community. Board intimidation occurs as frequent and maybe more frequently than homeowner intimidation. Because a board member has been intimidated to agree with a tyrannical board member does not make that member bad. Get rid of the tyrant(s) and give the rest of the board a chance to act in your best interest. I don’t live in your community, but you do so only you and your neighbors know the truth about what is happening in your communities.
    I’m not suggesting that you change your plans but if a board member has only been in the position for 6 months don’t be too quick to judge without understanding the true dynamics of your board.

    Dennis

    Go to comment
    2022/11/21 at 5:45 pm
  • From Dennis Legere on Statute of Limitation for HOA violations

    Timothy,

    While there is a statute of limitation for violations of Arizona law of only one year, I know of no statute of limitations relative to the association citing violations of the community documents. There should be but I know of none.

    Dennis

    Go to comment
    2022/11/17 at 3:59 pm
  • From Cynthia Black on Please post link to HB 2158

    As usual, your input is greatly appreciated. Thank you so much!

    Go to comment
    2022/11/13 at 6:45 pm
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