Thursday, December 06, 2007

Maryland law to deal with defunct associations
Fred Pilot sent this. Just watch. This will become a common situation in the years to come. I have been predicting it for a long time, and now the evidence is starting to make it into the press.

Apathetic homeowners' associations soon could find themselves paying court-appointed receivers to manage their affairs. A Maryland law that took effect Oct. 1 states that a group of three or more owners can ask the courts to appoint a receiver if their home-owners' or condominium association fails to recruit enough directors to meet a quorum. The receiver then would make all management decisions for the community until it assembled a large enough board. "We've had some communities in Maryland that have gone bankrupt. Some others are just hanging on by a thread and are in terrible condition" due to neglect by their boards of directors, said District 10 Sen. Delores Kelley, the sponsor of the bill.

5 comments:

Anonymous said...

For the non-condo HOAs, this trend points up the failed public policy of privatizing local government. It cannot function if its constituents don't want it.

Anonymous said...

I think that the bigger issue is one of human nature and is not unique to community associations at all. Apathy within organizations, be they community associations, churches, or auto companies is a real problem and challenge for leaders. How do we keep people informed, engaged, and interested (even when they don't have an axe to grind) is the real question.

Anonymous said...

I couldn't agree more with Fred Pilot on this one.

To equate the "apathy" in an HOA to the apathy in a voluntary organization is, in my view, engaging in obfuscation. The apathy in an HOA is in many cases, really antipathy. Many owners are content to allow the HOA, because of the trouble HOAs cause, to wither on the vine and die. Sic semper tyrannis!

The CID concept remains a failure and such attempts to revive defunct HOAs are nothing more than self serving local governments and their attorneys continuing the shake down of the homeowners, the wants and desires of the owners be damned.

Whatever happened to the concept of consent of the governed? I am not talking about the manufactured consent that is implicit in HOA 'contracts' but real voluntary consent of the governed! It is the right of the people to alter or abolish oppressive governments, and that includes HOAs.

Anonymous said...

Who says the homeowners must be interested in mandatory associations? The homeowners have no obligation to the "we" that preys upon them.

What if the homeowners choose to no longer have a mandatory association? If they moved there because they "chose" it, then one can hardly refute the proposition that the HOA is dead because the members prefer not to have one.

Isn't this part of the myth of choice? Can't the homeowners CHOOSE to terminate the HOA?

If you are prohibited by law from terminating a term-limited HOA, that's a perpetual HOA and denies the owner the benefit of being free of one after the term is up. Are we going to see CAI promoting the property rights of the owner in termination of the HOA? Doesn't CAI represent homeowners? Isn't this one of the benefits due the owner under private contract?

What happened to freedom of association? If this is governed under contract law and the homeowners choose to terminate the association, aren't they entitled to be free of a mandatory association that they initially "chose"? Now by state action, they are going to be compelled into mandatory association against their will?

In the SFH context, the HOA (not the homeowners) owns the common areas. The city/county can always take property via eminent domain or foreclosure in the event of unpaid taxes and make it public property. How ironic that after abandoning citizens by forcing them into mandatory associations in order to tax them while avoiding financial responsibility for amenities often mandated by the same cities/counties, - the cities/counties should ultimately be stuck with ownership and responsibility for the property anyway.

What about the benefits to the owner? Property owned by the city/county is tax exempt. No more "assessments" but rather only tax deductible property taxes. Restoration of a democratic process where resident's votes count. No more private fiefdoms established via Board member "educated" courtesy of "professionals". No more votes invalidated at the whims of Board members. No more incumbents "qualifying" their adversaries or successors in elections. No more monopolies on vendors to the detriment of all homeowners. No more accusations of violations to disenfranchise members from voting.

Procedural and substantive due process as well as equal protection would be required - no more unchecked Board members being goaded on by CAI management companies that their neighbors are "harming property values" and "disturbing their neighbors". No more private fining by the private police who directly profit through "citations". No more "priority of payment" scam to extort money from homeowners for the benefit of CAI vendors (note CAI's aversion to the FDCPA). Open records and open meetings instead of "educated" Board members encouraged to conceal records and engage in closed meetings. Behavior that DAs ignore in HOAs becomes a criminal offense when performed by public officials. Who wouldn't want to be free of mandatory associations?

Obviously these people chose to be free of the HOA and should not be compelled back into one.

Mike Reardon said...

Antipathy, I like that.
Most people I know in my community skip involvement out of disgust, not apathy.
I myself will not willingly participate in the farce of association governance due to my repect for real governance, and the underlying priciples of democracy upon which it is based. Almost all of which are almost completely lacking in association 'governance.