HOA Embezzlement Prevention Bill (HB 3803) To Be Heard Today

San Antonio HOA Lawyer Trey Wilson wrote:

State Representative Ruth Jones-McClendon's HB 3803 is set for public hearing today before the House Committee on Business and Industry. 

As I previously wrote, the Bill (filed on 3/8/13) seeks to prevent Board-member fraud and embezzlement of HOA funds through a series of money management procedures and local government regulation. Pundits have predicted substantial testimony concerning the Bill.

It should be an interesting day, as sentiments on both sides of the Bill are strong. Among the most important concerns regarding the Bill are its financial implications upon the Texas Attorney General, cities and counties who would be granted regulatory authority over HOAs. According to the Fiscal Note prepared by the Legislative Budget Board, local governments, including the City of Houston, are uncertain about the financial impact of this new-found authority. 

  

New Bill Proposes Local Government Control and Attorney General Oversight of HOAs

San Antonio HOA Lawsuit Lawyer Trey Wilson wrote:

State Rep. Ruth Jones McClendon of San Antonio has filed legislation that would cede control over Texas Homeowners Associations/Property Owners Associations to cities and counties, with oversight and monitoring to be conducted by the Texas Attorney General's office.

The initiative -- HB 3803 --  is captioned as "Relating to the municipal and county regulation of and the oversight by the attorney general of property owners ’ associations and unit owners ’ associations; providing penalties."

This bill would authorize Texas cities (in city limits and ETJ) and counties (in unincorporated areas) to regulate HOAs on a variety of matters of "municipal concern," and to require registration with the applicable unit of local government. Other portions of the bill affect the way HOA funds are deposited and maintained (in trust accounts) and contain new bonding and insurance requirements for HOAs and their directors. 

Sections 3 and 4 of the bill are particularly dangerous to Texas HOAs because they would require the Texas AG's office to monitor HOAs and investigate complaints about them.  These provisions expressly provide for notification to the AG in the event of embezzlement of HOA funds.   A particularly interesting, if unclear, section of the bill directs the AG to monitor the banking institution where HOAs maintain the newly-required trust accounts. 

The bill was filed on March 8, and was referred to the House Committee on Business & Industry on March 21.

If enacted, this legislation would modify the Texas Local Government Code and Chapter 82 of the Texas Property Code. 

Proposed Legislation Would Give Texas HOAs Power to Foreclose Without Court Assistance

San Antonio HOA Lawsuit Attorney Trey Wilson wrote:

Earlier this month, Rep. Kenneth Sheets (Dallas) introduced HB 2928. If passed, this bill would give Texas Homeowners Associations legal authority to foreclose assessment liens (for HOA dues and similar charges) non-judicially (on the courthouse steps) much like a mortgage lender or other lien holder.  Under current law (Texas Property Code Section 209.0092), Texas homeowners associations can only foreclose liens judicially -- by filing a lawsuit and obtaining a judgment. Obviously, lawsuits give property owners more due process (and consequently take longer and are more costly) than do Sheriff's Sales or similar non-judicial foreclosure processes.

The most significant aspect of HB2928 is that it does not require that a Declaration/CCR contain a provision authorizing a private power of sale as a condition of authorizing non-judicial foreclosure in Texas.  Essentially, the law would grant to Texas HOAs a collection remedy that does not independently exist either as a contractual right (CC&Rs are considered contracts in Texas) or as a covenant running with land in an HOA-governed subdivision.

Another troubling aspect of this Bill is that it seems to directly contradict brand-new law (effective January 1, 2012) concerning HOA foreclosures.  As part of the HOA Reform package of laws passed during the 82nd Legislative Session (2011), property owners were expressly granted the right to democratically  determine whether to amend their Declarations (CC&Rs) to prohibit non-judicial foreclosure: Texas Property Code Section 209.0093  is entitled "REMOVAL OR ADOPTION OF FORECLOSURE AUTHORITY," and provides:

" A provision granting a right to foreclose a lien on real property for unpaid amounts due to a property owners' association may be removed from a dedicatory instrument or adopted in a dedicatory instrument by a vote of at least 67 percent of the total votes allocated to property owners in the property owners' association.  Owners holding at least 10 percent of all voting interests in the property owners' association may petition the association and require a special meeting to be called for the purposes of taking a vote for the purposes of this section."

If adopted, HB 2928 would obviate this right of property owners to determine whether or not to authorize foreclosures by their HOA. In my opinion, HB 2928 favors Texas HOAs, at the expense of rights recently granted to homeowners.

We've moved our office -- please stop by and say hello!

San Antonio HOA Lawyer Trey Wilson wrote:

Trey Wilson has moved his law practice to 111 W. Olmos Dr., San Antonio, Texas 78212. Phone, fax and email will remain the same.

New law makes going green easier for HOA residents

San Antonio HOA Lawyer Trey Wilson wrote:

SAN ANTONIO – The Texas legislature put some limits on homeowners associations, adding rules that would make going green easier for homeowners.

That change in the law actually took place a year and a half ago but groups that promote solar say many HOAs don’t even know about it and continue to ban solar panels from their neighborhoods.

GALVESTON HOA PREZ files $10 million defamation suit against resident

San Antonio HOA Lawyer Trey Wilson wrote:

GALVESTON – A local homeowners association president alleges he is the focal point of certain false statements made by another resident and has filed a $10 million lawsuit. 

In recent court papers filed Nov. 29 in Galveston County District Court, Seascape Owners Association president Ron Benotti accuses Richard Alan Collier of making defamatory remarks and emailing them to numerous individuals.

The suit alleges Collier wrongfully labeled Benotti as “arrogant,” “incompetent,” “dishonest,” “unethical” and “harassing.”

Things the defendant said included that the plaintiff mishandled a beach nourishment dune restoration project, acted unethically and illegally with no regard to the association’s bylaws or state laws and engaged in character assassination and a “personal vendetta” against him, according to the original petition.

Benotti points out that in the emails Collier “negligently or maliciously” stated the plaintiff committed election fraud; spied on Collier and his family, friends and business associates; and blamed the respondent for lying and financially misleading the homeowners association.

“The defendant intentionally or recklessly made statements that created a high degree of risk of harm yet deliberately proceeded to act with conscious disregard or indifference to the risk,” the suit says.

Benotti insists he has incurred substantial loss of his reputation and has suffered severe emotional distress.

A jury trial is requested.

Galveston County 56th District Court Judge Lonnie Cox is presiding over the case.

Case No. 12-CV-2972

'Jesus is the reason for the season' sign sparks controversy in Washington

San Antonio HOA Lawyer Trey Wilson wrote:

PASCO, Wash. - Jesus seems to be the reason for neighbors to fight about a sign in one Pasco man's yard. His large Christmas decoration has become the cause of controversy. The homeowner's association says this sign breaks its rules.

Missouri HOA Garnishes Man's Bank Account days before Christmas

San Antonio HOA Lawyer Trey Wilson wrote:  Talk about heartless.  Days after the death of his granddaughter, and the week before Christmas, a Kansas City HOA garnished the bank account of a past due homeowner.  Watch the video here:

Man's rough month includes homeowners association fight | Local News - KMBC Home

Bexar County Jury Awards HOA $208K from former President and Lawyer

San Antonio HOA Lawyer Trey Wilson wrote:

A jury has spoken in the somewhat protracted dispute between the Ventura s HOA and various owners of properties in that northeast Bexar County subdivision. The former HOA President and its former attorney were hit with a whopping $280K verdict on December 21, 2012.

Watch the videos from WOAI TV below.

HOA Sued for Cleaning Up Home Owner’s Patio Trash

San Antonio HOA Lawyer Trey Wilson wrote:

From The Buffalo News, N.Y.

Dec. 17 — When neighbors took it upon themselves to clean Suzanne Taylor’s cluttered patio in Buffalo’s exclusive Waterfront Village, she accused them of trespassing and discrimination, and eventually sued them in federal court.

After a three-year legal battle, a federal appeals court found Taylor’s suit to be “groundless and frivolous” and ordered a lower-court judge to award attorney fees to the home owners organization she sued.

Senior U.S. District Judge John T. Curtin, who had previously denied attorney fees to the defendants, did exactly that last week to the tune of $107,322.

“It’s not enough to prevail. Our clients had to prove her suit was frivolous,” said Minryu Kim, a lawyer for the Harbour Pointe Homeowners Association. “It’s very, very rare that courts award attorney fees to prevailing defendants.”

In discrimination cases, courts have a long history of not awarding attorney fees to defendants because of the “chilling effect” that might have on future discrimination cases.

Taylor had claimed disability discrimination — she said she suffers from depression — and Curtin found that her case was not “entirely unreasonable or without foundation.”

Now Taylor feels that the decision to award attorney fees will have other ramifications. 

“I really think there’s going to be a chilling effect,” Taylor said of the courts’ ultimate ruling. “I really think lawyers are going to be afraid to take these cases.”

The case of Taylor v. Harbour Pointe began more than four years ago, when neighbors, who 

had complained that Taylor’s patio was a “pigsty,” cleaned it up and moved several items to the inside of her garage.

When Taylor, who was out of town at a college reunion, returned home and found that her patio had been cleaned, she called police and filed a report accusing her neighbors of trespassing and burglary.

She eventually took her case, which became a housing discrimination complaint, to the state Division of Human Rights and the U.S. Department of Housing and Urban Development.

Read more: http://www.houselogic.com/news/home-thoughts/dispute-about-pigsty-in-buffalo-turns-into-a-legal-battle-royal/#ixzz2FbDLpXmZ