Governance of POAs

Posts on HOA Talk

2009 May 05
See History for brief descriptions of changes and updates. 

    This writer has made a number of posts on HOA Discussions on HOA Talk which provide additional information on Governance or Property Owners Associations.  Click on HOA Discussions to access the discussions as a non-registered reader.  More privileges are provided if you sign up as a registered user. 

    The continuation of this post provides search information for the HOA Discussion Topics on which I have posted. 

Don Nordeen
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• History:  Changes are usually identified in the text with the date which facilitates searching by date.  Edits are usually noted by add and delete changes. 
  • 2009 May 05 — Initial Post
• Links:  Posts on HOA Talk at [http://swagman.typepad.com/poa_governance/2009/05/posts-on-hoa-talk.html]
• Key Words:  • Accounting Principles;  • Attorney Issues;  • Case Law, Michigan & Other;  • Common Interest Development;  • Community Associations Institute;  • Fiduciary Duty;  • Governing Documents;  • Legislation, CID & POA;  • Legislation, CID & POA Model & Content;  • Legislative Issues & Proposals;  • Nonprofit Corporation Acts;  • POA Board of Directors Issues;  • POA Governance;  • POA Members' Rights;  • POA Problems;  • POA Resources;  • POAs, General;  • Private Government;  • Reference Materials & Papers;  abuse; access; access to records; accountable; accounting; accounting principles; accounting standard; ADR; advocacy; AICPA; AICPA Audit & Accounting Guide; AICPA Audit & Accounting Guide for Common Interest Reality Associations; alternate dispute resolution; alternative dispute resolution; amendment; annual meeting; architectural committee; architectural control committee; architectural review committee; attorney; attorney client privilege; attorney general; attorney obligation; audit; bill of rights; board of directors; breach of fiduciary duty; business judgment rule; bylaws; CAI; case law; CC&R; CC&Rs; CID; CID/POA; CIDs/POAs; CIRA; client; client attorney privilege; client attorney privilege; client lawyer privilege; closed meeting; closed session; collection; common interest community; common interest development; common interest homeowners coalition; Common Interest Realty Association; community association; condo; condo ombudsman; condominium; Condominium Act; condominium association; condominium ombudsman; conflict; conflict resolution; consolidated financial statement; constitution; corrective action; Covenant; Covenants Conditions and Restrictions; CPA; declarant; democracy; democratic; depreciation; developer; developer control; development; director; directors’ obligation; disclosure; dispute; dispute resolution; due process; dues; duties; duty; duty of care; duty of loyalty; duty of obedience; duty to act; easement; election; enforcement; enforcing; engagement; engagement letter; excessive; executive; FASB; fiduciaries; fiduciary; fiduciary duties; fiduciary duty; financial statement; fine; foreclosure; freedom of information; GAAP; generic CC&Rs; glossary; governance; Governance of Not-for-Profit Organizations; governing; governing documents; grievance; harass; harassment; HOA; HOA abuse; HOA ombudsman; home owners associations; Homeowner Bill of Rights; homeowners associations; improvement; land development; law; laws; lawsuit; lawyer; lawyer client privilege; legislation; Legislation, CID & POA; Legislation, CID & POA Model & Content; legislative; legislative issues & proposals; legislature; limitations; lodging; meeting; members' meeting; members' rights; model act; model bylaws; model CC&Rs; model covenants conditions and restrictions; negligence; nonprofit; nonprofit corporation; non-profit corporation; Nonprofit Corporation Act; Non-profit Corporation Act; nonprofit GAAP; notice; obligation; oligarchy; ombudsman; open meetings; organization as client; owners' rights; planned communities; planned communityplanned unit development; POA; POA Act; POA Board of Directors issues; POA governance; POA members' rights; POA problems; POAs, general; preservation; preservation fund; Private Government; private government; problem solving; problems; property owners association; property rights; proxies; proxy; proxy vote; proxy voting; public policy; PUD; quorum; reference materials & papers; regulation; rental; reserve; reserve fund; restrictive covenantcommunity association; home owners association; homeowners association; property owners association; resources; restriction; restrictive covenant; roles and responsibilities; rule; rules and regulations; special meeting; statement of rights; subdivision; transparency; trustee; unreasonable; vacation rental; vote; voting

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New Jersey Twin Rivers Ruling

2006 February 10
Last update:  2007 Aug 11.  See History for brief descriptions of changes and updates. 

• Use your browser's search command to search for the date in the above form, or just the year and month to search more broadly, to locate text that has been added or updated. 

    A ruling by the New Jersey Court of Appeals in the Twin Rivers case was issued on 2006 Feb 7.  (added 2007 Aug 05)  The NJ Supreme Court (full opinion at Committee for a Better Twin Rivers v. Twin Rivers Homeowners' Association (A-118-122-05)) overturned the Court of Appeals, or maybe only part, and added a number of general considerations/requirements concerning owners associations.  This may well be a landmark case in that it is a first to rule that certain constitutional rights, namely free speech and expression, extend to common interest developments and to property owners associations (POAs). 

    The case was brought by a few members of the Twin Rivers Association against the Twin Rivers Association.  The plaintiffs were assisted by the Rutgers University Law Center and the New Jersey chapter of the ACLU.  Based on information available on the internet, the combined legal costs (plaintiffs and defendants) may well be in excess of $500,000.  Along with the five-year court battle, the high cost illustrates why many of the fairness and justice issues for POA members are not litigated.  Individual members of property owners associations just don't have that kind of money, and consequently actions of boards of directors remain unchecked.

    The continuation of this post provides further discussion and links to various articles and other information on the case. 

Don Nordeen
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• History:  Changes are usually identified in the text with the date which facilitates searching by date.
  • 2006 Feb 10 — Initial Post
  • 2006 Mar 3, 16, 25, and 26
  • 2006 Apr 6 — updated URL for opinion updated. Added text concerning expressive rights from opinion.
  • 2006 May 5 — link to discussion forum on this lawsuit added.
  • 2006 May 8 — link to law review article on this lawsuit added.
  • 2006 Jun 12 & 13 — added brief discussion and links to articles concerning appeal to the NJ Supreme Court and related legislative activity
  • 2006 Nov 04 — link to Mr. Staropoli's post on the AARP Amicus Brief added
  • 2006 Dec 30 — added discussion of the case that was submitted to a law weblog, and and a link to the related news article
  • 2007 Jan 14 — added recent news articles and link to Mr. Staropoli's post summarizing the case
  • 2007 Feb 10 — added link to New Jersey law blog post
  • 2007 Aug 05 — added several links concerning the decision by the NJ Supreme Court
  • 2007 Aug 11 — added comments re need to address legislatively
• Links:  New Jersey Twin Rivers Ruling at [http://swagman.typepad.com/poa_governance/2006/02/new_jersey_twin.html]
• Key Words:  KeyWords

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Community Associations Industry

2005 December 04
Last update:  2006 Mar 14.  See History for brief descriptions of changes and updates. 

• Use your browser's search command to search for above dates or just year and month to locate added and/or revised text. 

    Terminology is an ongoing issue with regard to Common Interest Developments (CIDs) and Property Owners Associations (POAs).  Various states use different terms for essentially the same definitions of real estate developments and organizations of owners.  Another informal organization that is significant in both is the "community associations industry" — sometimes called the "common interest development industry" which is use in California and other western states. 

    The continuation of this post describes these two informal organizations, their content, and their interests.  Regardless of what may be stated, individual homeowners are not significantly represented in either. 

Don Nordeen
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• History: 
  • 2005 Dec 08 — Initial Post
  • 2006 Mar 14 — added internet search information to show interest of the industry in itself vs. owners who provide all the funds
    
• Links:  Community Associations Industry at <http://swagman.typepad.com/poa_governance/2005/12/community_assoc.html>
  
• Key Words:  KeyWords

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Thoughts on Community Associations Institute

2005 November 01
Last update:  2006 Nov 24.  See History for brief descriptions of changes and updates.  

• Use your browser's search command to search on the date or just the year and month to locate additions and updates for the particular day or month. 

   POA legislation appears to be in turmoil with many amendments proposed in the state legislatures.  Lobbying appears to be intense in some states, particularly by the common interest development and community associations industry (CID/CA Industry) and some local chapters of Community Associations Institute (CAI). 

    The changes in legislation for property owners associations (POAs) are moving in a consistent direction — incorporating more and more democratic principles.  While CAI claims to be the voice of the 54,000,000 residents living in community associations, they are not at the forefront in advocating democratic principles and members' rights.  In fact, it appears that CAI in some states is actively opposing the democratic reform.  Democracy and members' rights are virtually absent in the research arm of CAI, Community Associations Institute Research Foundation. 

    The continuation of this post discusses these interrelated issues.  I am interested in your thoughts on this important issue. 

Don Nordeen
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• History: 
  • 2005 Nov 01 — Initial Post
  • 2005 Dec 10 — added discussion that CAI RF website does not support democracy and members' rights
  • 2006 Feb 12 — added note that CAI actions in the NJ Twin Rivers case doe not support members' rights and interests
  • 2006 Mar 14 — added link to major policy document of CAI which illustrates that CAI is not an advocate of members' rights and interests
  • 2006 May 06 — added links to CAI's documents that support the developer's model  of governance
  • 2006 May 29 — added questions concerning preservation of constitutional rights and use of democratic principles, and additional sentences and phrases concerning CAI's  equivocal and obscure words considering these two questions
  • 2006 Jul 02 — significant editing and expansion of discussion concerning CAI's claim to be the national voice for individual property owners — search for 2006 Jul 02 with your browser
  • 2006 Nov 24 — added search results from weblog by Mr. Skiba, CEO of CAIe words considering these two questions
• Links:  Thoughts on Community Associations Institute at [http://swagman.typepad.com/poa_governance/2005/11/thoughts_on_com.html]
• Key Words:  KeyWords

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Proposed Amendments to UCIOA

2005 September 30

    The Uniform Law Commissioners, formally the National Conference of Commissioners on Uniform State Laws (NCCUSL), drafted an existing model law for POAs called Uniform Common Interest Ownership Act (UCIOA) in the mid 1990s.  They have recently undertaken a project to draft amendments to the UCIOA.  Incorporation of governance provisions for POAs is one of the areas under consideration. 

    The continuation of this post is an email to the Uniform Law Commissioners on their work to draft amendments to the Uniform Common Interest Ownership Act (UCIOA).

Don Nordeen
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POA Legislation at Crossroads

2005 September 14
Last update:  2006 May 29.  See History for brief descriptions of changes and updates.  

Work in Progress (posted for interest and comments)

    This post attempts to define some of the history of POAs and why that history has led to a number of problems with many similarities across the states.  Many of these problems are inherent in the way in which property owners associations have been authorized under the various state laws, and further defined in governing documents that have been drafted by real estate developer.  (added 2006 May 29)  Still others are related to the economic interests of the developers and the assumptions in drafting the initial governing documents and in the various state laws. 

    This history is very pervasive, and has resulted in many people thinking that what has existed in history is the only way for the laws to be.  Moreover, trying to address problems and improve the law is very difficult if one believe that the way of the history is the only way.  Thinking "outside the box" is required. 

    Developers, attorneys, accountants, banks, insurance companies, and others involved in community associations all have their lobbies.  The rank-and-file property owners must depend upon the elected legislators to be their advocates.   

Don Nordeen
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• History: 
  • 2005 Sep 14 — Initial Post
  • 2006 May 20 — added more information on legislators being advocates for individual POA members
  • 2006 May 29 — major revision
• Links:  POA Legislation at Crossroads at [http://swagman.typepad.com/poa_governance/2005/09/poa_legislation.html]
• Key Words:  KeyWords

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Analysis of POA Problems

2005 September 14
See History for brief descriptions of changes and updates. 

    Work in progress (posted for your interest and comments)

Don Nordeen
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• History: 
  • 2005 Sep 14 — Initial Post
• Links:  Analysis of POA Problems at [http://swagman.typepad.com/poa_governance/2005/09/analysis_of_poa.html]
• Key Words:  KeyWords

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Update of Model POA Act (UCIOA)

2005 September 10
Last update:  2008 Sep 26.  See History for brief descriptions of changes and updates. 

    In an internet search on other subjects, I discovered that the Uniform Law Commissioners have a project to update the Uniform Common Interest Ownership Act.  The formal title for the Uniform Law Commissioners is The National Conference of Commissioners on Uniform State Laws (NCCUSL). 

    The Uniform Law Commissioners have developed at least two model acts concerning POAs (they use the term "common interest owners"). 

• Uniform Planned Community Act, issued in 1980
• Uniform Common Interest Ownership Act (UCIOA) issued in 1994

Both of these appear to be based on real estate development aspects and the transition from developer controlled to POA control including the transfer of common property.  Neither significantly addresses the governance of the POA after control has been transferred to the POA. 

    The Uniform Law Commissioners now have a "Drafting Committee to Prepare Amendments to Uniform Common Interest Ownership Act."  The committee now has draft documents on relevant reference materials and proposed amendments, all dated 2005 Feb 24.  My cursory review suggests that the proposed amendments extend what I call the "Developer's Model for POAs" (board controls almost everything with few members' rights).  Some groups have provided documents concerning the members' rights issues, but they don't appear to be integrated into the proposed amendments. 

    The continuation of this post provides additional information and comments on the model laws developed by the Uniform Law Commissioners.  Your emails to the Commissioners are needed to bring the members' rights issues into consideration.   You can contact this committee at:  nccusl@nccusl.org.  Please include the name of the committee in the Subject line of your email.

    (added 2008 Sep 26)  Further monitoring of the activities indicates that the Drafting Committee appears to be responsive only to organizations within the Common Interest Development Industry.  This is indicated by the reference materials they have posted at the UCIOA website.  I have written to both the chair of the committee and its reporter and have not received any response, nor were the communications included in the committee's reference materials. 

Don Nordeen
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• History: 
  • 2005 Sep 10 — Initial Post
  • 2005 Dec 04 — added information on the Uniform Common Interest Ownership Act (1994)
  • 2006 Jan 06 — added Selected Transcript of 2005 July 27 Meeting of the Drafting Committee on Amendments
  • 2006 Mar 04 — added more information on the Uniform Common Interest Ownership Act (1994), and the role of the drafting committee
  • 2006 Apr 28 — reference CLRC memo on common interest model laws and related discussion added
  • 2006 Jun 19 — Information added on Maryland's Common Ownership Community Task Force established by the legislature.
  • 2006 Nov 01 — reference to Florida Report on CID/POA law added
  • 2008 Sep 26 — added paragraph to introduction concerning the limited receptivity of the writing committee
• Links:  Update of Model POA Act (UCIOA) at [http://swagman.typepad.com/poa_governance/2005/09/update_of_model.html]
• Key Words:  KeyWords

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CNN Program on Homeowners Associations — aired 2005 April 16

2005 July 05

     Many communities are governed by property owners associations.  Not all is well.  Many of the problems are generic.  The CNN program covered one such problem and includes an interview with Dr. Evan McKenzie, one of the scholars in the field of private government.  The continution is a transcript of that segment on POAs.
   
Don Nordeen
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