Do HOA foreclosures violate 14th Amendment?

A US Supreme Court case, State Farm v. Campbell, 538 U.S. 408, on the topic of punitive damages has bearing on the Radcliff foreclosure in California, and on other HOA foreclosure cases. Here’s what the USSC said in 2003:

“Compensatory damages are intended to redress a plaintiff's concrete loss, while punitive damages are aimed at the different purposes of deterrence and retribution. The Due Process Clause prohibits the imposition of grossly excessive or arbitrary punishments on a tortfeaser ... Punitive damages awards serve the same purpose as criminal penalties … However, because civil defendants are not accorded the protections afforded criminal defendants, punitive damages pose an acute danger of arbitrary deprivation of property …”

This was an insurance case, won by the inurance company, with a ratio of 145:1 in punitive damages that the Court denied. The foreclosure against the Radcliff’s was for $120 debt and the loss of home equity was some $285,000, representing over a 2,000:1 punishment.

Is your vote necessary to amend CC&Rs?

A September 2004 Michigan Appeals Court decision addressed the validity of amending the CC&Rs with less that a unanimous vote. The Court held to the position that homeowners are bound to amendment changes that are passed in accordance with the CC&Rs amendment provisions -- a less than 100% vote binds all others. Talk about lack of informed consent to such potentially wide-ranging impact on your home.

Citing another case, the Court considered the following as a possible consequence of allowing a less than unanimous vote:

"Taking these words to mean that particular lots could be excepted [say from paying assessments] permits the obviously unintended result that 51 per cent of the owners could exempt their own property and leave the other 49 per cent encumbered or could even impose more strict restrictions upon certain lots."

Therefore, It went on to say,

"We conclude that the logic of the many courts cited [ ] is sound and should be followed here: Non-uniform covenant amendments require the unanimous consent of the affected property owners. Permitting non-uniform amendments and exemptions by majority or supermajority vote would destroy this crucial aspect of covenants and thus undermine the entire system of private regulation of real property in Michigan. The fundamental premise that makes people willing to bind themselves to the burdens of restrictive covenants is that the resulting benefits are assured; each property owner relies on the fact that all are bound equally ….”

HOAs are outside the US Constitution

Evan McKenzie joins in on clarifying the limitations on our rights and the how a private government can get around and use the US Constitution against unknowing Americans. Now, something seems wrong here, doesn't it?

From Deborah Rich's very good article in the SF Chronicle on Sept 25th.

"Homeowners associations, being private organizations, cannot violate the Constitution, no matter what they do. They can tell you to take down your Christmas decorations, your American flag, whatever," says Evan McKenzie, political science professor at the University of Illinois, Chicago, lawyer and author of "Privatopia: Homeowner Associations and the Rise of Residential Private Government'' (Yale University Press, 1995).
"Since it is not state action, the Constitution does not protect you against it. The Bill of Rights only protects us against the actions of government. We do not have a First Amendment right against other individuals. Cities can't ban political signs, but your employer can." And so can your association, unless states pass laws prohibiting such a restriction from being included in CC&Rs.

"We're going to have a presidential election, and there's going to be plenty of neighborhoods where there won't be any signs," says McKenzie.

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Other articles on the prohibition of political speech by HOAs were carried by The New York, Times, The Cincinnati Enquirer,The Daily Chronicle (IL), The Post & Courier (Charleston, SC), and the Beaufort Gazette.

The myth of private property rights in HOAs

Black's Law Dictionary defines private property simply as:

"Protected from public appropriation over which the owner has exclusive and absolute rights".

and rights as -- "the interest, claim or ownership that one has in tangible or intangible property"

We are talking about your absolute and exclusive rights in real property when it comes to owning our home. And when you see your name alone, or with your spouse on the deed and title to your home you say, "YES! Mine and all mine to do as I please!"

But not so in a homeowners association where the buyer must look at the fine print that simple says "subject to any covenants, conditions and restrictions attached to the property". This is a warning to buyers that your absolute and exclusive rights to your home no longer exist. But the myth of "your very private home ownership" still pervades the real estate promotional and advertising literature, and by the public policy, civil liberties and constitutional rights organizations.


Not so as the courts have pointed out when they uphold these CC&Rs. The HOA, a private organization, has been granted the right to decide what you can do with your property because they also have an interest, a claim, a right to do so as granted by that simple phrase in your deed -- "subject to any covenants, conditions and restrictions". A more accurate description would be "communal", a sharing in your property rights by the HOA as representative of the community.



The HOA can decide the color of your house, the landscaping of your property,what structures may ne added/modified, etc. And the HOA is not a governmental agency with all those built-in protections, but a private government whose purpose is not the same as the Preamble to the US Constitution, but to maintain property values without regard to the Bill of Rights.

We have lost the fundamental belief and value of the American Revolution -- private property rights. Whether your private property rights are taken by the government or by unconscionable adhesion contracts sold under highly suspect sales practices, it is abuse of your individual property rights. There is no difference.

HOAs are communal with respect to your individual private property rights. Compare your rights with homeowners not living in an HOA.