Homeowners under HOAs may find themselves at the mercy of a board that uses their dues to finance protracted legal battles that silence opposition, Bergemann said.
"It becomes a literal dictatorship in a country that is supposed to be the land of the free," he said. "You only have recourse if you can wake up a majority of the owners, which is really difficult, and if you can pay to fight the lawyers."
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In Privatopia, the right to petition for redress of grievances often means filing a costly petition in the courts.
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"In Privatopia, the right to petition for redress of grievances often means filing a costly petition in the courts."
Or, as Evan McKenzie put it last year in an interview on Shu Bartholomew's "On the Commons" radio program (June 26, 2010):
It's like something you would see in Nazi Germany or Soviet Russia. People think these things don't go on.
But we know they go on every day in condo and homeowners associations.
These people who have no idea how to use power at all. They won't even accept limits on their power.
They don't even know what the law requires of them, these directors.
They go by what some lawyer tells them to do, which the lawyer tells them to do only because he or she knows they can get away with it.
Because the only recourse you have is some civil suit.
Here in Illinois, we don't have an Ombudsman. Most states don't. There's nowhere for owners to turn.
If the lawyer tells them "Oh, just jack 'em around. Who cares what the rules are? Who cares what the law says? It doesn't make any difference."
The transaction costs of enforcing an owner's rights are so great that they are hardly ever able to do it.
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