Legal Question in Landlord & Tenant Law in California

HOA Board - Conflicts of Interest

My HOA has 56 units, there are 36

large units and 20 small units, the

HOA Board is comprised of 5

members, 4 who own large units,

who are putting forth a change from

% of sq foot to a level mo.

assessment, under a Davis Stirling

minimum i.e., greater than 50% of

the ownerships vote for passage, in

the above equation the small 20

units are being SLAM DUNKED by

the ''tyranny'' that is the HOA

board, who refuse to re-structure the

voting to make for a fair system prior

to testing issues, they are obviously

''self dealing'', shouldn't this A) be

recognized by the law firm who

penned the CCR proposed changes B)

shouldn't this Board recuse

themselves from voting , given they

are to benefit knowingly, by the

proposed change and violating a

section of the BY-Laws regarding

Conflicts of Interest C) shouldn't a

reputable Law Firm who represents

de facto the Shareholders of the HOA

admonish the Board

Please advise....


Asked on 6/18/07, 6:57 pm

1 Answer from Attorneys

Robert L. Bennett Law offices of Robert L. Bennett

Re: HOA Board - Conflicts of Interest

Your question is well thought out, and extremely erudite. The main problem is that the law regarding HOA's has given wide latitude to the HOA, i.e. the Board. In addition, since the lawyers drafting the documents, are usually retained by board members, the Board has a huge "home court advantage". Additionally, the courts have given wide latitude to HOA's as far as making their own CCR's and staying out of HOA "politics". The end result is that one can see a parallel between HOA's and Native American tribes with their own laws on the reservation ( their own casinos, no taxes on sale of cigarettes, their own courts and police force, etc.). The bottom line is that the law has almost always been construed in a way that favors the HOA. I regret that I do not have the time to research your answer thoroughly, because you pose some very interesting questions, including liability of some type for the law firm which was responsible for drawing up the paper work. A class action law suit gives one food for thought. My initial perusal was the possibility of a Constitutional question predicated on the denial

of equal protection, based on the detrimental aspects involving the owners of the smaller units. My ultimate advice would be to gather together as many of the owners of the smaller units, and consider hiring counsel for a potential class action suit. Before doing that, you might want to look closely at some Davis-Stirling remedies.http://davis-stirling.com/ds/laws/1363.820.htm. Good luck!

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Answered on 6/18/07, 9:16 pm


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