Orange
County Pair Might lose home for $120 in Missing Dues
By Ronald Campbell, Orange County - Register, January
06, 1991
A few missed bills totaling $120 probably will
force Tom Larance and his mother, Edith Anderson, from their home of
24 years.
The bills were for homeowner-association
dues, and as Larrance and Anderson have learned, the bottom line on
those bills is to pay or lose your home. It is a cautionary tale for
the hundreds of thousands of Orange County residents who live in tracts
run by homeowner associations.
Larrance, 43, an unemployed carpenter,
and his elderly mother are in an unusual bind. While Southern California
homeowner associations threaten hundreds of residents with foreclosure
each month, foreclosure sales are rare. " I'd say in about 99
percent of the cases, the money ultimately gets collected and there's
no foreclosure," said Brad Walker, an Irvine attorney who specializes
in condominium law. "Make that 99.9 percent of the cases."
Westminster attorney Larry Rothman represents
600 Southern California homeowner associations. He files 250 foreclosures
a month. In his 14 years in practice, he said, he has seen "no
more than four or five" such sales.
Larrance and Anderson's home was
sold at auction--without their knowledge, they say--for $1,057.26
in April 1983, and a long court battle has ensued. Lotterman
Properties Inc., which is trying to evict them, obtained the condo
by bidding the minimum amount required, including delinquent dues,
penalties, interest and processing costs.
The 700-square-foot townhouse, set in
a well-kept neighborhood not far from the ocean, was worth $190,000
at the time, Larrance and Anderson say in court papers. They believe
it is worth $150,000 today. They have paid all but $2,700 of the mortgage
principal.
Larrrance and Anderson claim in two
lawsuits that they are the victims of fraud by CAMS -- a now-lefunct
company that managed Surfside Homes by the Sea, where they live --
and of an illegal eviction by Lotterman Properties. Lotterman says
the mother and son are the victims of their own mistakes.
California law allows homeowner associations
to foreclose on members who fall behind in dues, said attorneys Rothman
and Walker, who are not involved in the Larrance lawsuit
Typically the owner owes a small amount
compared with the value of his or her house. As drastic as foreclosure
might seem, however, associations have no good alternatives for collecting
debts, Rothman said. Associations could file liens, entitling them
to money when the house is sold, he said, but "that doesn't help
you pay for your roof, your facilities."
They could get judgments in small-claims
court, he added, "but now what? The individual says, (Try and)
collect it."
Foreclosure works like this: The bill
collector records a notice of delinquency, putting the debtor, credit
agencies and title companies on notice that a bill is unpaid. Thirty
days later if the bill is unpaid, the collector records a notice of
default. This amounts to a public announcement that the property will
be sold in 90 days if the bill remains unpaid. Then comes a notice
of sale, followed by a public auction.
Court records say Larrance and his mother
failed to pay their $40 association dues in October 1982. The delinquency
grew to $120. CAMS held an auction after recording all the proper
notices. But Larrance an his mother never got the notices. Sent
by certified mail, the notices were returned unclaimed, court records
show. Larrance said that at the time, his mother was in Florida
and he was away on a job.
They said they paid their bills on time.
They believe that CAMS stole their payments and reported them as delinquent.
CAMS, which managed hundreds of homeowner associations, collapsed
in February 1984. In August 1990, CAMS owner Jack Miller began
a four-year prison term for misappropriating $1.8 million in homeowner-association
funds sent to CAMS.
Miller's technique, according to court
records, was to collect association dues, pay current bills and delay
depositing the rest of the money.
After the notices went out, CAMS
attorney Paul Bell auctioned the townhouse for the delinquent dues,
penalty, interest and costs: a little more than $1,000.
Lotterman got the property, its second
bargain purchase of a CAMS-managed condo in four months.
Larrance and his mother claim that Bell
colluded with Lotterman. Public records show that Bell did have other
dealings with Lotterman and its president, Santa Monica attorney Marilyn
Kay Ward. One week before the Larrance auction, Lotterman bought an
orange property and arranged for the deed to be mailed to Bell. Later,
Bell represented Ward in an Orange County Municipal Court lawsuit.
Bell and Ward shared post-office boxes in El Toro in 1984 and in Palo
Cedro, a Shasta County town, in 1988. Neither Bell nor Ward returned
phone calls seeking comment.
The foreclosure sparked a long court
fight. Santa Ana attorney James E. Strachan, who has represented Lotterman
since late 1988, said a lawsuit prevented Lotterman from evicting
Larrance and his mother years ago.
But the battle is winding down Larrance
and his mother have lost at least two attorneys for failure to pay
legal bills. And they each have filed bankruptcy to delay the eviction.
Larrance said that he has spent $12,000 just in the past two years
and that the fight has brought him and his mother "to the point
of destitution."
Strachan said he thinks it all will
be over within two months. But if you'd asked me that question a year
ago," he added, "I would have said two months."
Notes:
Hundreds of homes in California are routinely put into foreclosure
by homeowner association lawyers when homeowners miss paying, or dispute
their maintenance dues, late charges and fines.
(Boards managers and associations can
make up any rules they want and then fine the homeowners) for rules
violations their neighbors board members.)
Lawyers can
charge thousands of dollars to collect
to collect minor amounts of dues or even a $5
late charge. When homeowners seek protection from the
courts, multimillion dollar Directors & Officer's Liability Insurance
policies are used to subject the homeowners to scorched earth litigation.
California laws were written to allow
homeowner association lawyers to seize homes and savings for lawyers
fees using either nonjudicial or judicial process.
:-(
Eviction proper . . . but worrisome
By Laurie Roberts, Republic columnist, Arizona
Republic, Aug. 03, 2002
Everything was handled according to
law and, more importantly, in strict compliance with those oh so sacred
covenants, conditions and restrictions that come with living in a
neighborhood such as hers. Everything was fair and square. Everything
that could be done was done. Or so I'm told. So why do I feel as if
somebody bilked an old lady out of her home?
Somehow, I can't get that picture out
of my head: the image of a 77-year-old Peoria widow rolled away
on a gurney, kicked out of her home of 17 years while neighbors look
on from lawn chairs. A day later, she was undergoing an examination
to determine her mental state. Oh, now she gets checked for
mental problems? Now, after her house is taken away, someone
wants to find out if she's able to fend for herself? Clearly, something
is wrong with this picture. You know the story. Old reclusive woman
tangles with her homeowner association because of overgrown trees
and bushy bougainvillea.
What follows is a series of legal missives
and ultimately a judge's demand that she trim her trees. Old lady
gets mad and begins refusing to pay the dues that come with living
in Westbrook Village. Old lady's home is
sold out from under her for less than half of what it's worth
so that Westbrook Village can collect its due, which by this time
has rocketed to $25,000. And the Glendale man who bought the house
for a song gets a court order to evict her.
Marie Brown is not exactly the most
sympathetic character. This is a woman who, by all accounts, can be
rude, stubborn and paranoid. This is a woman who lived in squalor,
who at one time could have settled the dispute for $1,500 and refused.
This is a woman who clearly needed help.
"I begged and pleaded with her
over and over to please just comply, to please hire an attorney, please
contact family members to help her, please just do what the association
is requesting you to do, and she didn't want to do it," said
Penny Koepke, Westbrook Village's attorney. "We would spend,
I'm not kidding, hours on the phone and she would go on these tangents
about things that happened five or six years ago." Koepke said
Adult Protective Services was called in May 2000 and determined Brown
was mentally fit. "I still felt uncomfortable, but that was their
determination," Koepke said. "I thought, they're not stepping
in, so I've got to move forward."
Brown was rousted out on Wednesday.
Three days later, I'm still wondering how the system that so easily
took away her house couldn't first have taken steps to make sure she
had an advocate and knew what she was doing. It doesn't sound rational
that someone would willingly live as she did. Peoria Constable Ron
Myers said she had sores on her arms from the filth. "I've been
in houses with dead bodies that didn't smell as bad," he said.
It doesn't sound rational that a
77-year-old woman would forfeit her house and everything she had invested
in it because of a dispute over tree trimming. It doesn't
sound rational, but apparently there's nothing the courts could do,
other than take away her home. Henry Blanco, who oversees Adult
Protective Services, says the law makes it difficult to force an adult
to accept help. "There's not much you can do," he said.
"A person has the right to refuse services."
And so an old lady is out on the street
today. I can't help but think that this was a woman who clearly needed
help. What she got instead was evicted.
:-(
Violence
begets violence
Why did a homeowner
enter a homeowner association meeting with guns blazing?
By AHRC News
Services, April 22, 2000
Phoenix, Arizona - At about 2 p.m.
on April 19, a former homeowner went to a homeowner association meeting
in Peoria, Arizona and opened fire. 2 people were killed, and three
were injured.
Did these people have to die? What happened
to cause a 61 year old law-abiding citizen to amass an arsenal of
weapons and enter a meeting of his former homeowner association with
guns blazing?
As the facts come to light, a familiar
pattern begins to emerge, which is replicated in countless homeowner
associations from California to Florida. A homeowner's complaints
go unaddressed, boards treat homeowners unequally, boards employ lawyers
to hound homeowners and financially bankrupt them with threatening
letters, injunctions and law suits, scavenger neighbors ignore the
abuse and keep selling their votes to corrupt boards and vendors -
"we do not want to get involved", "he's disgruntled",
"we love our community".
Mr. Glassel bought his retirement home
in 1994 for $84,000. He apparently had problems with his air-conditioner
from the beginning. It would freeze up in summer, allegedly because
the unit was too small for the home. The developer refused to replace
it with a larger unit. He wanted to install an awning, but the association
refused because it was not from an "approved vendor". (Why
were there "approved vendors" - was somebody getting a kickback?)
The association refused to give him
a variance for his property, but gave one to a board member. (Double
standards are a cause of significant problems in homeowner associations).
In 1998, Mr. Glassel was upset that the associations new gardening
company was scalping the vegetation in the entire association. When
they came to his property, he refused to allow them to do the same.
They allegedly came while he was out and scalped his bushes anyway.
(Vandalism by abusive vendors). The association manager hired a CAI
lawyer to get an injunction against Mr. Glassel to put him under their
dictatorial control over his home.
The lawyer obtained a 5 year injunction
stopping any contact between the maintenance workers and the senior
who still had to pay their services. In addition, Mr. Glassel was
required to pay the lawyers fees for the injunction. The lawyer then
garnished Mr. Glassel's bank account for his legal fees of $1,081
in legal fees and interest - Glassel only had $39.00 in his bank account.
There is no doubt that the end result
was very tragic. But two haunting questions remain. Was Mr. Glassel
treated fairly, and is the current structure of homeowner associations
such that, similar acts may occur in other associations across the
country ? A full answer to the first question may have to wait till
further facts are brought to light, but a clearer answer can be given
to the second question.
Homeowner associations intrude into
people's lives to an extent that no other level of government does.
What city, county or state government tells you what flowers you
can plant, what color you can paint your house, how much your bushes
should be trimmed, who you can buy an awning from? The answer of course
is none, but homeowner association governments can do that. The
more a governmental body touches the core of a citizen's every day
life, the more some citizens are going to react. Americans do not
like the heavy hand of government telling them what they can and cannot
do in areas which traditionally have been their own. When corrupt
boards and corrupt lawyers are added to the mix, the result can be
explosive.
Homeowner associations have burst on
the American scene without many realizing where they have come from.
However, their genesis is quite simple. Working largely removed from
public scrutiny, developers of mass produced housing since World War
II have bought legislators and governors to pass legislation which
strips homeowners of many of their traditional rights. Under the dubious
guise of protecting property values, developers were allowed to erect
a vast superstructure of rules and regulations which restricted a
homeowner at every turn. In addition, iron-clad enforcement mechanism
ensured that homeowners were forced to comply.
A group of lawyers, ever with an
eye to their own enrichment, quickly realized that there was significant
money to be made by jumping on the homeowner association wagon and
seizing the reins. They have ridden it for all it was worth ever
since. It is ironic but not surprising that the lawyer who secured
the 5 year injunction against Mr. Glassel, announced just 4 days before
the shooting that he had secured $12 million in settlements for alleged
construction defects in 2 other associations. He announced that two
thirds would go to the associations, and the rest, approximately,
$4 million to "court costs".
(Some observers have wondered why Mr. Ekmark characterized the $4
million as "court costs", when it was money going into his
own pocket.)
But these lawyers have not only been
busy on the local scene, but they have erected a national network
of lobby groups which unite all the vendors to homeowner associations
into a cohesive, disciplined force, which contributes heavily to politicians
in all states. This trade/lobby group, as is customary among such
entities, gives itself a nice, pleasant name, - Community
Associations Institute (CAI). The impression which the name
creates is of a benevolent educational institution devoted to the
impartial, objective pursuit of the truth. The truth, of course, is
radically different.
In state after state, it strenuously
lobbies for legislation which favors its own members interests, and
which is generally against the interest of homeowners. For example,
in California, CAI wined and dined the chairman of the Assembly Housing
Committee, and secured passage of a law which allowed association
reserves to be used for lawyer's fees and impose taxes with no caps
on homeowners to pay lawyers fees.
It is against this backdrop that 40
million Americans now find themselves trapped in a gargantuan swaddle
of rules, laws and special interests, with no effective recourse except
to file an expensive lawsuit. But when they file a suit, they generally
find themselves before hostile courts.
Research shows that many judges in one form
or another have social and financial ties to the lawyers who defend
the association. Time and again, homeowners suffer much frustration
and anger when judges inexplicably rule against them. In those few
cases where homeowners win, the association
lawyer wins handsomely also as his fees are paid by the association
members - including the one who won against the lawyer.
Americans now find themselves yoked
with an institution which has for all intents and purposes abolished
the American home. Instead of a country of free and independent citizens,
one seventh of the population finds themselves imprisoned in their
own homes. Instead of being their castle, their home has become their
prison. And, if CAI has its way, the entire
country is on its way to similar prisons.
The violence in Peoria is cause for
great sadness on all counts - for the victims naturally, but also
because a law-abiding citizen was driven to a desperate act because
oppressive institutions and their agents crossed that threshold of
a person's freedom and integrity. Homeowner associations of all
governmental agencies impinge most into the personal lives of each
citizen. The deaths in Peoria should send a profound warning signal
to all associations that something is structurally amiss.
The surprise is that there have not
been even more instances. Across the country, homeowners cry in
pain and anguish at what they have to endure in homeowner associations.
In California, one such person, Jim
Troutman, committed suicide. In another case in Arizona, one homeowner
was so harassed at an association meeting that he had a heart attack
and died. Some homeowners have to defend
themselves against foreclosure due to a fraudulent $5 late charge.
Some have to endure persecution from boards who do not
provide any service. Some lose their homes due to false charges.
A few specific instances will illustrate some of the things which
are happening:
Margie Cochran was trying to her roof
repaired - the association lawyer got a TRO for "harassment"
and garnished her bank account for legal fees.
Vera Armstrong Cherry, a POW wife wanted
to get access to the records after her fees went up too much. The
association lawyer got a TRO against her and $79,000 in legal fees.
She was also 5150'd, a device in California to put people in mental
hospitals for 72 hours against their will. Her teenage children were
home alone, unaware of their mother's whereabouts for days. When she
appeared in court, the lawyer asked the judge for security, a device
used over and over to discredit homeowners in court. (CAI lawyers
training brochures tell managers and boards to control "difficult
homeowners" with neighborhood watches, police reports, 5150's
and TROs)
Maureen Aschoff, an Orange County School
Board Member sued the association lawyer saying he told her tenants
that they should not make the rental payments to her.
Mary Lindsey, a single mother, and grandmother
fell behind in her $70 a month dues and asked for a payment plan.
The association lawyer filed suit instead and charged legal fees of
$33,000 to collect $787.00 in dues, late charges and other costs.
She lost her home. She said that as those lawyers got shot in San
Francisco, so it will not be surprising if something similar happens
in homeowner associations.
In another case, the association sought
a TRO to force an owner to allow the association to continue watering
her property, even though the house was sliding down a hill.
Dr Melahoures, put in a satellite dish
in his sideyard in compliance with FCC regulations. The association
lawyers have collected over $250,000 from the homeowners by suing
and losing in court. The same association spent a similar amount suing
another homeowner and losing .
Jim Abrahams, a 66 year old retiree
was fined and sued for parking his motorhome in his own motor home
parking lot with his tenants permission. The association lawyer collected
$28,000 in legal fees. Jim lost his home.
In human affairs, there is always a
day of reckoning. The murders in Arizona may portend that this day
is approaching a lot faster than some would have thought. An even
greater tragedy than the deaths in Arizona would be not to learn from
the mistakes, corruption and legal violence that led to this violent
outburst.
Violence breeds violence, whether that
violence be physical, legal, or otherwise. The human spirit can only
endure so much, and associations by their very nature and some of
the players in them, walk that very thin line which separates life
from death. Vast and profound reforms are needed in all associations
to protect homeowners from the corrupt and arbitrary exercise of power,
and from the predations of lawyers. If such a Homeowners Bill of Rights
had existed in Peoria, maybe two people would not be dead, and Mr.
Glassel would not be in prison.
:-(
