Author: Nona Tobin

“Heads will roll if lips aren’t sealed about GM pay”

Or, anyway, that was the threat, before…

Contact13’s Darcy Spears highlighted Sun City Anthem’s excessive executive compensation on the “HOA Hall of Shame” on Channel 13 action news last Thursday.

Living in Las Vegas can cost more when your home is in an HOA, but where does all the money go? Contact 13 looks at who’s getting a big slice of the pie in one of the largest communities in Southern Nevada. Click on photo to watch 3 1/2-minute video.

Threatened with legal action? Really?

Did you catch that report at the end of the video?

Neither the GM or the Board would even answer KTNV’s call to explain how the SCA Board justified such big payouts.

“Instead, they had an attorney respond who claimed State law prohibited the HOA from discussing anything about salaries and we learned the HOA threatened legal action against some owners after Contact13 started asking questions about manager pay rates.”

Is any of that true?

It is 100% true that the GM has used OUR attorney to threaten legal action to try to keep her pay a secret.
  • against me personally,
  • against other owners,
  • against the association itself, and
  • in this case, against a TV station,

But, it is 100% legally and morally wrong to use our SCA attorney to unlawfully hide from owners how much of OUR money is going into her pocket.

Are any SCA employee salaries/ benefits confidential by nevada law?
Short answer:       No.

Per NRS 116.31175, most personnel records are confidential, but not compensation.

…4(a) The personnel records of the employees of the association (are confidential), except for those records relating to the number of hours worked and the salaries and benefits of those employees;

Why would the SCA attorney say employee compensation is confidential when the law clearly says the opposite?

In my view, he is simply representing the wrong client.

As the SCA association attorney, he is being paid by the owners to act as OUR agent, not to be the GM’s agent.

In fact, there is a law specifically prohibiting him from representing the GM because it is a conflict of interest. See NRS 116A.640(6). He is duty bound by law to act, solely and exclusively, in the best interests of the association membership as a whole.

But, is he?

I certainly don’t see it. I see the GM approving tons of unnecessary attorney fees that owners pay to protect her imaginary privacy rights.

And like Ricky Ricardo, I think Adam Clarkson has some ‘splainin’ to do.
Why did I get a threatening letter because of this story?

I was told this story was taped, after the fact, last October, but then nothing happened, and I forgot about it.

On 12/22/17, I submitted a written request for SCA to update the 2017 employee compensation table that had been given to another resident on 1/31/17. The budget was ratified in November, and I suspected the Board had given the GM another bonus in secret despite the petition for a vote of no confidence signed by 825 owners and her failure to meet the 12/31/17 target about the restaurant.

When CAM Elyssa Rammos emailed me around 1/15/18 that the 2018 salary table was ready to pick up at the front desk, I was in Mexico and asked for it electronically.

When I got no response, I asked Ruby Leong to pick it up and email it to me before the MLK 3-day weekend. They gave her the run around.

“It’s not ready.
We gave it to someone else.
We have to make changes.”

None of which was true.

The reason for the stonewalling was exactly what Darcy Spears said. Between the time Elyssa Rammos had notified me that the 2018 employee compensation chart was ready, and Ruby Leong could drive a few blocks to pick it up, Sandy Seddon had gotten a call from someone at KTNV.

Quick as a flash, Adam Clarkson manufactured an absolutely false legal interpretation out of thin air that the 2018 version of the previously-released 2017 table was now confidential because Contact13 was doing a story.

Wow. It’s magic.
Documents become invisible, and our money disappears.

SCA’s $325/hour attorney blocked the release of the 2018 update of the 2017 SCA employee compensation table that was already in the public domain. SCA homeowners had to foot the bill for Clarkson to write “legal letters”, in SCA’s name, in January to threaten legal action against me if I told KTNV what the GM’s pay was (even though they already knew) and against KTNV if they ran the story.

There was no Board action authorizing this threat of legal action – unless, of course, they took the action in a secret meeting.

And, by the way, NRS 116.31088 requires a VOTE of the membership, before SCA can file a civil action. But no big deal.

This is a provision of the law that Adam Clarkson made disappear when the SCA Board filed a civil action to evict the Foundation Assisting Seniors. I’m sure Adam Clarkson’s convoluted reading of the law will come up with some magical way that allows the GM to use him to threaten litigation, against anybody or everybody, in SCA’s name, and on SCA owners’ dime.

What did I do about this “legal letter”?

I filed an affidavit under penalty of perjury on 1/31/18 with NRED.  I requested that this complaint be incorporated with the ongoing investigation into the harassment and retaliation complaint which precipitated my unlawful removal from the Board on 8/24/17.

It is my understanding that these complaints will be heard by the CIC Commission on November 6, 2018.

More to come.

The next few blogs will discuss the magnitude of the GM’s misuse of the association attorney to act as her personal fixer.

No restaurant as of June 28 Board meeting

The game goes on…but now they’ve got a scapegoat.

I have been dealing with other things this past month, and had not kept up with the last month of the two-year restaurant process. I had heard that the negotiations had broken down with the one vendor left standing.

So, I went into the Board meeting thinking that the deal with G2G was off the table.

When I sat down, an irritated resident told me the Board was still negotiating a sweetheart deal with G2G.

I was further confused when I opened my computer and saw that at 1:13 PM,  literally minutes before the 1:30 PM meeting, palace-favorite, blogger Berman published a letter G2G sent to the GM saying that the deal was off, no matter how big the subsidy.

And here’s the kicker – it’s all Dick Arendt’s fault that G2G pulled out because he talked bad about them on Anthem Opinions.

How (and why) did Berman get a leg up?

It is inappropriate, from my perspective, for the GM and the Board to have a death grip on information which should be openly and immediately shared.

But it’s worse when they blatantly give David Berman “scoops” because they can count on him to consistently write favorably about the GM and the Board – NO MATTER WHAT – and unfavorably about other bloggers who won’t give the Board or the GM a free pass when they screw something up or screw someone over.

Shouldn’t everybody have easy access to the same information at the same time?

If it is confidential, it is confidential from everybody. If it is not confidential, it should be made readily available for the easiest possible access. The GM and the Board are creating a huge amount of unnecessary conflict by the way they mis-handle communications.

The GM and the Board play favorites and do not uniformly enforce the rules of confidentiality. They use information as power, and block access from their detractors. When criticized for this failure, they go crazy, and threaten the owners, particularly bloggers, who out them.

Why couldn’t G2G make it?

Apparently, free rent, free utilities, and ZERO profit-sharing with SCA until the obviously-unattainable $1.4 million revenue number was reached was not a sufficient subsidy to overcome the damage done by the bad-mouthing of the non-Berman blogger.

How did the GM characterize what happened?

The GM did not quote the entire G2G “we’re outta here” letter with those attending the Board meeting that she unfairly shared with David Berman before the meeting.

I say “unfairly” because it allowed her to use a willing tool to illegitimately stoke the fires of animosity AGAIN against  their common nemesis, and his reviled, competing blogger, without her having to dirty her hands.

Anyone else who requested such a document would have been threatened with sanctions for even asking for it, and then had to swear on the head of her newborn grandchild that it would not be disclosed before it would have been handed over.

She did, however, in making her report, focus on the phrase in the letter that most effectively, albeit unfairly, shifted the blame away from her, and her own gargantuan part, in designing an RFP/negotiation process ensured to fail.

She said that the SCA-G2G negotiations had reached impasse over “drop and go’s”, alcohol and pot lucks,

The Board wanted to talk some more, and SCA’s team thought they could get a deal, but G2G wrote her today that it is no longer interested. She paraphrased this part of the pull-out letter.

“… the blogging of Dick Arendt and his call to boycott the restaurant even before we opened.

So, …(we’re withdrawing due to)… the poisonous atmosphere illegitimately manufactured by a blogger.”  G2G

What’s the bottom line?
The Board approved a motion to direct management to continue to look for a restaurant tenant.

The GM asked the Board to approve two Board members to work with her. Tom Nissen is now fully retired from the Board and not willing to serve as a non-Director member of the work group. No matter how many times this method has failed (using a couple of Board members with the GM instead of an independent, specialized expert), hope springs eternal.

The good news is Gary Lee, the Director I think has the most experience negotiating restaurant contracts, was appointed to the team.

The bad news is that, to get a successful restaurant, Gary Lee will probably have to do a lot of the GMs job. The GM has not demonstrated herself capable of getting a successful restaurant tenant in place since she got here in November 2015 – even through that expectation was the one specific criterion the Board adopted – and probably ignored – for her 2017 bonus.

Public comments

One owner had specific suggestions about how to economically poll owners about whether they want a restaurant at all, and encouraged the Board to look at the possibility of just a bar and appetizers. There were suggestions for the Board to take a broader view of what would work in that space, including a food court or the high quality of places he had seen in Asia.

The old guard continued to promote the idea that only people who show up at meetings should get a voice, but I got the sense there was a small crack opening in Board acceptance of the idea that other people need to be heard.

What were some of the Board comments?

Several Directors said they were disappointed to be back at square one, but had an interest in getting more owner input. They saw the need for improving the RFP process to more clearly spell out the parameters in advance and to be open to wider competition.

Several Directors unfairly blamed bloggers, particularly Dick Arendt, for G2G pulling out, just as other Directors have voiced this same unfortunate refrain to deflect criticism of previous Board decisions that weren’t particularly owner-friendly.

“Shut up. We’re in charge here.”

They again asserted that the Board should take legal action to stop the criticisms of the Board and management that they think are totally unwarranted.

It’s a weird perspective to me – this being America and all. Utterly lacking in a sense of what gives legitimacy to their power

“Governments are instituted …deriving their just powers from the consent of the governed.”
-the Declaration of independence

I am particularly saddened when I hear Art and Jim rant about the need to silence dissent. I like them both, on a personal level, and think they are good people.

I think they just are not getting how they are unwittingly contributing to the polarization of the community by representing only some of the people, and by not tolerating  diversity of opinion about the way we want to be self-governed.

To self-righteous and aggressively defend themselves and those who agree with them against perceived injustices only becomes dysfunctional when that outrage is used as justification for intolerance and threatening to use legal force to stop the free expression of dissent.

I never wanted to be a blogger, but now, I will defend my right of free expression to my last breath.

Double your Donation to Foundation Assisting Seniors

Deadline is Sunday, July 1, 2018

No dollar limit. All donations will be matched.

An anonymous, and very generous supporter of The Foundation Assisting Seniors, ( FAS) supporters, has offered a cash match to double ALL donations made before July 1, 2018.

It’s fast and easy to make a difference.

If you would like to participate,

  1. you can mail your check to the new FAS office at 2518 Anthem Village Drive #102, Henderson 89052 or
  2. deliver it to the new FAS location in the commercial complex East of the Von’s Shopping Center behind the large red brick office building. Call(725) 244-4200 if you can’t find it.
  3. or call Phyllis Washburn (702-719-2882) Phyllis will personally pick up your donation – and probably give you a hug.

Down the road, but not down and out

FAS may have been rudely removed from its 15-year home in Sun City Anthem, but the dedicated volunteers are still here nearby to provide the valuable, FREE service of delivering durable medical equipment for the use of any senior that happens to be in need.

Do your part today. Double your donation by July 1.

Part 3: In case you don’t think this is enough evidence

This is the third, and final, part of my 6/6/18 email to the NRED Chief Investigator and Ombudsman to clarify NRED’s process for ensuring that
1. the rights of homeowners in HOAs are protected,
2. Nevada statutes are uniformly enforced, and
3. Board members or agents suffer consequences if they fail to act as fiduciaries.

Justice delayed is justice denied

Three Hawaiian Princesses – Tara Noalani, Ella Nahiena’ena welcome Issa Anale’a to the world. I fight to ensure “liberty and justice for all” is a core value in the world we pass on to them.

Justice delayed is justice denied

The length of time NRED has taken to address the complaints I submitted last September without response has unfairly diminished their credibility or, in some cases, rendered them moot.

This is unacceptable, particularly since these issues (election interference, concealing association documents, retaliation, harassment, unlawful removal from the Board for essentially political purposes are all issues of great import to protect homeowners in all Nevada HOAs.

Denial without prejudice? Hardly.

Denial “without prejudice” in one election interference case was nonsensical. A 10/20/17 complaint that Bob Burch was wrongly left off the removal election ballot because two pages with a combined total of 22 signatures mysteriously disappeared so allegedly, he was two signatures short of being placed on the ballot. On 12/11/17 the complainant (not me) was notified by Christina Pitch that the case was closed stating:Say, what?

Claiming that the Ombudsman’s attendance at the vote count of the ballots (ballots that did not include Bob Burch) was sufficient justification to deny the complaint that Bob Burch’s name was wrongly excluded from the ballot (due to 22 missing signatures) is a complete non sequitur.

NRED might as well have denied the complaint because Kilauea volcano erupted.

Further, Bob Burch was treated as a non-conflicted Board member at the November 1 recall vote count despite the complaint about his not being included on the ballot was still open until NRED’s December 11 rejection.

To say that this was not prejudicial to the claimant (meaning that he could file the complaint again after the point was moot) adds insult to injury.

Inappropriate use of association attorney

NRED appears to condone SCA GM and Board giving an inappropriate level of deference to association attorney Clarkson.

Those same 11/1/17 recall vote count owner meeting minutes show the tip of the iceberg of the completely inappropriate role Adam Clarkson took in the recall election process.
Not only was there no Board approval:

  1. to amend the adopted SCA Election and Voting manual,
  2. to dump the volunteer Election Committee and
  3. no Board approval to hire a CPA and
  4. no Board approval to pay the CPA firm and the Clarkson firm over $100,000 in unbudgeted funds to take over (and bungle) the recall election,
No law gives an HOA attorney decision-making authority

There is substantial additional evidence that Clarkson unlawfully acts as a decision-maker, or as the GM’s attorney, rather than solely as a legal advisor to the full Board.

What more does NRED need?

In what form can I submit this evidence where I can be assured that it will be weighed by an independent trier of fact?

Freedom of information is non-existent at SCA

GM’s concealing association records and using the attorney to threaten owners for even asking appears to be condoned by NRED.

NRED gave two different responses to the draconian records request form revised by the Clarkson law group 2/28/18 to suit the GM regardless of the law or best interests of the homeowners.

NRED response 1 was pro-homeowner.

The first was an email response to a homeowner in March correctly stated the owner protections in the law,

“The “mandatory acknowledgement” form…is contrary to NRS 116, as such a document is not required by law.”

NRED response 2, as reported by Bob Burch, was pro-management.

The second NRED response was only reported verbally.

I haven’t seen any written response from the Ombudsman to the SCA Board, but the Board President has reported that NRED approved the unlawful “acknowledgements” on the document request form that restrict the homeowner from sharing legally accessed material with third parties.
Could this really be true?

According to the Board, NRED has approved the SCA threatening homeowners that, if the information (released per NRS 116.31175) is disclosed to third parties, the owners may be subject to fines and penalties up to foreclosure.

These Clarkson-crafted “acknowledgements” are allegedly (according to Clarkson) binding even if the owner does not sign or agree. According to SCA, NRED says this is okay, just so long as the owner is not required to sign the acknowledgement.

Does NRED have a double standard?
Note that the document request form’s revision was not approved by an official Board action despite the requirement of SCA bylaws 6.4(a)(b) p. 24.)

The Board abdicated its duty to make records accessible to owners contrary to NRS 116.31175, and the GM never signed a management agreement acknowledgement per NRS 116A.620(1)(a)and (m) that the HOA records do not belong to the manager.
Yet, NRED apparently issued a verbal ruling giving the SCA Board and management carte blanche to carry on.

Could this really be true?

And one last thing

Lack of transparency allows SCA homeowners to be put at risk due to

  • management errors,
  • bad decisions,
  • inappropriate use of the attorney at triple the adopted budget, and
  • resistance to implementing sufficient checks and balances.

My insistence in attempting to address these problems led to the harassment and retaliation that was the true impetus of my removal from the Board.

Note that NRED has not responded to my 7/21/17 Form 781 complaint other than to refer it to the investigations division. The problems of withholding and concealing records have been exacerbated over the past year, and I have submitted additional documentation to the complaints in September,  November and January evidencing this unacceptable pattern.

What is NRED going to do to address these issues?

Part 2: Secret meetings in general

This is the second part of my 6/6/18 email to the NRED Chief Investigator and Ombudsman to clarify NRED’s process for ensuring that
1. the rights of homeowners in HOAs are protected,
2. Nevada statutes are uniformly enforced, and
3. Board members or HOA agents suffer consequences when they fail to act as fiduciaries.

Issa Anale’a didn’t make us wait as long as NRED

Why has NRED needed more than nine months?

Tomorrow, I’ll see what NRED Chief Investigator’s perspective is on the 6/6/18 email I am sharing below in Part 2 “Secret meetings”, in the previous blog, “Why so quiet?“, and in the final part 3, “In case you don’t think this is enough evidence”

Part 2: Secret meetings in general

The second complaint was that the Board deliberates in secret meetings.  This complaint being dismissed perfunctorily is also problematic. It appears as if NRED condones a pervasive pattern at SCA of decisions being made by the Board, the attorney, the GM or individual directors without proper action by the Board in open session.

It also appears that there are no consequences if SCA Board is not compliant with NRS 116.31083, NRS 116.31085, or SCA governing documents.

NRED previously instructed SCA on this point

Previous NRED officials have issued letters of instruction (attached to previous email) to require statutory conformance (with owner protection laws) which SCA now ignores.

I, as well as other SCA residents, have alleged that, currently, many Board decisions are made improperly, i.e.,

  • in group emails,
  • in “workshops”,
  • in improperly noticed meetings,
  • private Board training (no notice, agenda or minutes) sessions which are
    • deemed “attorney-client” privilege while
    • simultaneously are deemed to NOT be executive sessions, but of which recording is prohibited:
  • meetings or email chains involving only a few Board members or which pointedly exclude dissenting directors
What does it mean when the NRED investigation of these complaints just stops without a finding?

Obviously, the SCA Board was notified that SCA has won by default, but apparently the owner who complained was not.

As Bob Burch said,

Both complaints were closed without any action being taken against the Association when the division determined that there was no good cause to continue with the investigation. In other words, we prevailed.

This is essentially what has occurred in 100% of the cases filed in the past year.

Is that NRED’s intent? 

  • Does NRED really intend to say that this Board conduct, that has generated many owner complaints, is permissible despite the Board’s failure to meet the requirements of NRS 116.31183 or NRS 116.31085?
  • Or are you not convinced that the complainants accurately reported impermissible acts?
  • Does NRED’s investigative protocol permit your investigator to rely on information provided by the HOA, but prohibit further investigation by seeking additional information, or at least a response, from the complainant?

Whose call is it anyway?

NRED needs to be aware that at SCA, Board decisions are routinely made by the GM or attorney in policy areas in which the Board is prohibited from delegating by SCA bylaws 3.20 and 3.18 pursuant to NRS 116.3106(1)(d).

These wrong parties (the GM, the attorney, a subset of the Board) falsely claim the Board made decisions that the Board didn’t make correctly, or worse, didn’t make at all, e.g.,

  • hiring debt collectors without an RFP (competitive process),
  • increasing group exercise user fees,
  • failing to comply with the Election & Voting Manual in the 2017 recall election,
  • hiring a CPA without a contract or an RFP to do the volunteer Election Committee’s job,
  • paying that CPA and attorneys, at a $100,000+ un-budgeted combined cost, to usurp the recall election process,
  • over-expending the legal fees budget by $200,000+ in 2017,
  • taking punitive actions, without legal authority, against me as a Board member and unit owner, i.e., threatening letters and kicking me off the Board in retaliation for my complaints and records requests,
  • authorizing the use of owners’ money to pay for the association attorney
    • to appear in the GM’s divorce and
    • to withhold SCA records in discovery that had been previously released to OSCAR, the anti-recall group.
When the NRED investigation into these actions just stops, or maybe never even starts, what does it mean?
  • Is abdication and usurping of Board authority okay in NRED’s view?
  • Does NRED need more documentation and more specific examples to establish that this practice is occurring?

What else does NRED need to stop this?

Here is a link to a www.SCAstrong.com blog, “If they had only known, part 3” that gives some examples of GM decisions that resulted in election interference, hiring bankrupt or conflicted debt collectors without due diligence or following proper procedure, a biased selection of a restaurant vendor (that is not proceeding for unknown reasons, leaving SCA with no restaurant for 2 1/2+ years and counting).

I can also provide you links to the actual documents that are are evidence of these and other specific incidences if NRED needs more documentation to make a finding and prohibit agents from taking advantage of SCA.

Coming up:

Part 3: In case you don’t think this is enough evidence

Why so quiet?

Sorry for the big break in my updates about SCA shenanigans.

I’m in California for some family events,

Nathaniel graduated

and a new granddaughter due any minute

But, while we’re waiting for the next big thing, I’ll tell you

The real cause for pause

After a fun-filled trip to Mexico, I dragged myself to the May 24 Board meeting. I was immediately stunned by the President’s report that NRED had stopped investigating two complaints that impacted me.

I wondered if NRED’s practice was to rely on management or agents rather than get the whole story. I hoped not. But, I had a sinking feeling…

Ordinarily, I would have posted something right away, but I decided to talk to NRED’s new chief investigator, Terry Wheaton, first. Multiple attempts to set up a meeting were unsuccessful so I documented my concerns in writing.

It is even longer than my usual missives, so I’ll break it up for you. It was full of hyperlinks to the actual evidentiary documents. I will break the links in this public distribution, just in case, my transparency forces the SCA Board and GM to claim it is their fiduciary duty to pay the attorney $10,000+ to threaten to sue me to kingdom come.

Part 1 of email to NRED

Fwd: Issues related to dismissed and open investigations; NRED Letters of Instruction to SCA

I am writing you now to document my concerns and request that you evaluate these documents before there is a final determination on my form 514a, 781, and three form 530 complaints  (harassment/retaliation, recall election interference, and for removing me from the Board without complying with NRS 116.31036 on false and unproven charges that I had placed matters before the Board from which I stood to make a profit.

1. NRED investigations are closed without notice or reason

In March, I raised this concern to Christina Pitch in the email I am forwarding here. You can see her response. However, the pattern of NRED closing complaints without a clear, legally defensible, equitable resolution seems to be continuing.

At the last Sun City Anthem Board meeting on 5/24/18, the new President Bob Burch made the following claims in his President’s report which were extremely disheartening because I have received no communication from NRED about these issues which intimately affect me and about which I have formally filed affidavits and declarations.

President’s report

Next, I would like to report that we have been advised by the Nevada Real Estate Division that two complaints filed against the Association have been closed. In one case, it was alleged that the Executive Board held an emergency meeting on July 18, 2017 to discuss employer liability and that the meeting did not meet the requirements for an ‘emergency’ under NRS116. In the second case, it was alleged that the Executive Board held secret meetings beginning in March or April 2017 in which appointments to committees were agreed upon and Association business was decided upon. Both complaints were closed without any action being taken against the Association when the division determined that there was no good cause to continue with the investigation. In other words, we prevailed.  – Bob Burch, 5/24/18

What does “no good cause to continue the investigation” mean?

Does NRED condone or just not care?

Dismissed complaint 1: July 13 “emergency” executive session

In my view, having a Board meeting without notifying me for the other six directors to approve a cease & desist order against me was an unlawful abuse of authority and certainly not an emergency.

What does NRED think?

Does NRED’s closing the complaint investigation without disciplinary action against SCA mean:

  • That NRED says it’s okay for the GM to fail to give me, an elected Board member, ANY verbal or written notice that the Board I was elected to was being called into an “emergency” executive session two hours after I was standing in her office being denied access to ANY SCA records despite NRS 116.31175 and SCA bylaws 6.4(c)?
  • That NRED says it’s okay for a GM, an at-will employee, to use the association attorney at SCA owner expense to threaten litigation against SCA (her employer) and me, a Board member, personally for creating “employer liability” for asking for justification for her being paid double the market rate and criticizing her performance and judgment despite NAC 116A.345(5)?
  • That NRED says it’s okay for six Board members to meet without and issue orders against me, the seventh EQUAL, ELECTED Board member, to limit authority as a Board member, restrict my duties, TOTALLY restrict my access to information needed to make decisions as a Board member, and restrict my right to vote on an equal basis with the other directors despite the prohibitions in NRS 116.3103(2)(d)?
  • That NRED says it actually was an emergency as defined by NRS 116.31183(12) affecting the health, safety and welfare of the community for 6/7 of the SCA Board to meet to order me, the seventh, to stop asking for a verification of the GM’s former salary and to reprimand me, without legal authority, for asking the GM to reconsider a ruling she made to prevent equal time in SCA official publications for a proponent of the recall election?
  • That NRED says that six members of the Board constitutes a quorum, and they (6 of 7) can meet in executive session to make decisions for the Board as a whole or to take action against the seventh Board member even if the six directors prevent the seventh Board member, despite the limitations defined in NRS 116.31185 or NRS 116.3103(2)(d),
    • from attending their secret session,
    • from voting, or even
    • from knowing their secret meeting is going to occur ?
  • That NRED doesn’t care that the SCA Board failed to comply with multiple provisions of state law and SCA governing documents?
Or is NRED saying
these owner complaints are frivolous and aren’t serious matters worthy of at least a complete investigation?

That meeting, actually held on 7/13/17, had numerous flaws which I spelled out to NRED in form 514a on pages 4-5 and claims are  supported by written evidence.

I now have a meeting scheduled for June 18.

Next time

Part 2: Secret meetings in general

 

If they had only known… Part 3

Owners pay a high price for Board ignorance

Basic ground rules the Board must learn by heart
  1. Association exists to serve the owners.
  2. Board exists to speak for the owners.
  3. Board may hire agents to act on behalf of owners.
  4. Association does not exist to serve the Board or management.
  5. Owners pay even when the Board or SCA agents make mistakes.
  6. Agents, including SCA employees, have no rights superior to owners’ rights.
  7. Rules exist to protect owners.
  8. Board must protect owners.
  9. The Board needs to learn the rules and follow them.

How can NRED training help the Board do right?

  1. Without proper training, the Board is ignorant.
  2. The Clarkson Law Group trained the Board to consult attorneys before ANY decision to the point of letting attorneys decide.
  3. Being ignorant, the Board has failed to protect owners from agents’ actions.
  4. Board needs to learn the rules set up to protect owners and follow them.

The process determines the result

Poor process = poor results

Board failures of the “duty of care”

The costly mistakes described below could have been avoided had the Board taken the training about the proper way to hire experts:

  1. The GM did not sign a management agreement with terms required by NRS 116A.620.
  2. The Clarkson Law Group hired as SCA debt collector without an RFP for  debt collector issued.
  3.  CPAs Ovist & Howard were paid $85,000+ to replace the volunteer Election Committee on the 2017 removal election without legal authority:
  4. HOA Lawyers Group LLC hired as SCA debt collector to replace the defunct and bankrupt Alessi & Koenig LLC
      1. without an RFP,
      2. without a Board-approved contract
      3. without competing with NRS 649 licensed vendors.

Board must learn the rules

Click here for the NRED training all directors should take to know how to prevent SCA being controlled by agents instead of by the elected Board: Hiring Experts and Professionals


Lessons the Board has yet to learn

1. When SCA became “self-managed”, the GM/CAM were hired without of a management agreement.
Not okay.

Absent a management agreement, the GM is an “at-will” employee and has no other rights than those bestowed by the SCA Employee Handbook.

2. RFPs are required for professional services not just construction or maintenance contracts per NRS 116.31086.

2.  The GM wasted $85,000+ for an unknown CPA, Ovist & Howard, to take over the recall election:

  1. without an RFP,
  2. without a Board-approved contract,
  3. without funding to pay for a CPA to do the recall in the adopted budget,
  4. without the Board amending the Election & Voting Manual to strip the Election Committee of its duties, and
  5. after the GM and attorney were both the subjects of active complaints that they were interfering with the independence of the Election Committee
  6. which resulted in diminishing the integrity of the election process.

Guess who benefitted. (P.S. It wasn’t the owners.)

  1. Four of the six Board members who allowed the GM to usurp the Board’s authority benefitted personally from unlawfully hiring a CPA to replace the Election Committee.
  2. Owners’ right to lawfully petition for a removal election was besmirched by the subjects of the petitions who wrongfully blamed the owners who petitioned for their recall for the huge cost of hiring a CPA that was done solely, 100%, by the GM under their watchful, grateful eye.

“For every action, there is an equal and opposite reaction.”   – Newton’s 3rd law

Hiring a CPA wasn’t the only way the GM sashayed in to usurp the authority of the Board, but to really take over, all dissent had to be crushed. These are things a properly trained Board would never have tolerated.

Action
As the liaison to the Election Committee,  I tried to get the GM, President Rex, and the attorney to leave the Election Committee independent and neutral to do their normal job during the recall.

Reaction
I was removed as the Board liaison to the Election Committee by the very people accused of interfering with the Election Committee’s independence.

Action
As a non-conflicted Director (not one signature, not one petition against me), I was one of the three Directors who should have decided

  • how the recall election was to be conducted,
  • whether the Election Manual should be amended for this one election
  • how best to protect the integrity of the election process

Reaction
The GM and the attorney decided to relieve the Election Committee from its duties despite having no legal authority to do so.

Action
I gave the Board notice of my intent to file a complaint of harassment and retaliation for all the actions they had taken against me in retribution for my recommending that the attorney and the GM be fired.

Reaction
The Board took the law into their own hands and kicked me off the Board without notice, process or appeal.

Kinda the same way Putin handled the one serious challenger to his re-election.

3. Restaurant RFP mistakes

  1. GM and one Director met with one competitor to give a leg up prior to RFP.
  2. Board was not informed of GM + director actions until it was a fait accompli.
  3. RFP issued to a hand-picked group of possible bidders
  4. Bids were not opened at a Board meeting.
  5. Bids were not not submitted on the same terms.
  6. After the number of vendors dropped to two, the “operating parameters” were adopted.
  7. Winning bidder who negotiated with GM in advance was allowed to change bid after the other bidder dropped out because the terms had been changed.
  8. No other bids were sought nor considered.

4. Last two debt collectors shouldn’t have been hired without RFPs

Doesn’t it seem like it’s a problem that

  1. HOA Lawyers Group became SCA’s debt collector without issuing an RFP to replace the defunct Alessi & Koenig, LLC?
  2. The Clarkson Law Group became the SCA debt collector without a RFP?
  3. The Clarkson Law Group, hired via the RFP issued to replace the Leach law firm as SCA legal counsel, used its “authority” as the SCA legal counsel to  “rule” that its own selection as the SCA debt collector did not require a separate RFP?

Who cares about debt collection?

We all should. Debt collectors are the source of huge expenses for HOA owners because of the weird way the Nevada courts allow HOA foreclosures to extinguish the bank’s security interest. While you might think this is good for HOAs, it is actually only good for the debt collector.

Remember, abdicating debt collection is:

  • a huge cost to owners
  • a violation of SCA bylaws 3.20 and 3.18(a)
  • foolish
  1. The cost of collection exceeds the amount recovered.
  2. HOA homeowners pay for the debt collectors’ fight with the banks.
  3. The loss of property value to each and every home in a Nevada HOA is, according to the UNLV 2017 study commissioned by the Nevada Association of Realtors, is 1.7% per foreclosure for delinquent dues.

 

 

 

If they had only known…Part 2

Board training is a MUST

NRED Power points are available for anyone to view on the training section of the NRED website. Check them out all out there or though future blogs.

Why be trained by NRED?

Learning from these FREE resources will reduce costly mistakes and transgressions by the current Board. In contrast, the attorney Clarkson trained the 2017 Board into handing over OUR wallets.

Look at this NRED training below that clarifies the Board’s job as the ounce of prevention that will save SCA a pound of excessive legal fees. A well-trained Board is a big – and necessary- step toward bridging the community divide.

Willful ignorance is a failure of duty of care

Here are two essential governance lessons that the 2017 Board REFUSED to learn.

  1. The buck stops with the Board. The Board MUST learn what its job is. The Board is not relieved of accountability by pretending  that management or the attorney have decision-making authority.
  2. The Board is restricted by law from delegating ultimate  accountability. The Board MUST define IN WRITING limits on the authority and actions of management and agents.

What’s wrong now?

Now, blurred lines allow the GM, the attorney, and individual directors (rather than the whole Board acting officially) to make decisions that ONLY the Board acting as a unit has the legal authority to make.

Requirements for a Board vote to be valid

Skip any of these steps, and no official Board action has been taken
Board action = motion, resolution, OR Board action item (BAI)
  • Notice to all Directors who ALL get to vote
  • Notice to all members who get a chance to speak
  • Agenda that clearly defines the action the Board is voting on
  • Minutes that say how each director voted

What if the GM says, “the Board decided…”,

but it didn’t follow the rules required for a valid Board decision?

THIS IS A VERY SERIOUS FAILURE TO ACT AS A FIDUCIARY

Here in SCA, these actions the GM took during the recall election diminished the integrity of the removal election process and could have biased the outcome in favor of the Directors who support her.

The modus operandi of malfeasance

  1. GM served the four Directors facing recall by removing people from the process who were dedicated to protecting the integrity of the recall election process (me as a Board member and the entire Election Committee).
  2. GM took away the authority of the volunteer Election Committee without approval by the only legal authority, i.e., vote by the non-conflicted Directors was required to change the Election Manual and spend un-budgeted funds.
  3. Rex worked with OSCAR to lie to the Election Committee to get them to remove me, a non-conflicted Director, as the liaison to the Election Committee after I attempted to protect the integrity of the election process.
  4. GM spent >$100,000 on a CPA and attorneys to do the volunteers’ job.
  5. GM allowed the paid interlopers to “lose” two pages of signatures which would have put Bob Burch on the recall ballot.
  6. GM disenfranchised the 2,001 voters who voted for me and kicked me off the Board without an official Board vote (on fake charges) at the EXACT SAME TIME as the recall process should have been controlled by me and the two other non-conflicted Directors.
  7. GM never officially notified the Board of the receipt of petitions to call for a removal election of four Directors who approved the GM’s double-the-market pay.
  8. GM never officially notified the Board of the receipt of a petition of no confidence against her.
  9. Right after the GM refused to notify the Board the petitions had been received,
    1. the GM used the association attorney to quash a subpoena in her divorce to prevent the petitions from being released in discovery
    2. AT THE EXACT SAME TIME that those petitions were released to OSCAR, the opponents of the recall of the Directors who support her excessive pay.
There is no end to this cycle without a properly trained Board.
Click here for the Powerpoint:
Executive Board Responsibilities & Fiduciary Duties
Click here for Powerpoint
Responsibilities of the Community Manager
Without training, SCA is doomed to repeat history.
  1. 2015 Board, including Rex and Tom, hired the GM at double the market pay.
  2. Rex claims that, as President, he has the right to control which directors get to participate in Board decisions and routinely excluded Directors with dissenting opinions.
  3. Rex appointed Aletta and Bob to study committees.
  4. On the advice of the GM and without consulting owners, Aletta and Bob decided that owner committees should be weakened or abolished under self-management.
  5. GM’s power isn’t controlled by written executive limits.
  6. Independent candidates are discouraged from running for the Board.
  7. Independent Directors will not run for officer positions.
  8. Rex and Bob keep the leadership roles.
  9. Rinse and repeat.

 

If only they had known…Part 1

New Director training

NRED Power points are available for anyone to view on the NRED website. Check them out all out there or though future blogs.

Learning from these free resources will reduce unhealthy over-dependence on attorneys.

Click here to link to blog:
Why SCA now pays so much in legal fees

Click here for NRED presentation:
Welcome to the Board 

If the 2017 Board had taken this class from NRED instead of being trained by attorney Adam Clarkson, would directors still have acted outside authority granted by NRS and the SCA governing documents?

Why SCA now pays so much in unnecessary legal fees

Adam Clarkson trained the Board,

and he has convinced them that the budget doesn’t matter when it comes to legal fees.

The Board, following Rex’s leadership, foolishly insisted that the 2017 Board training be conducted in secret by Adam Clarkson.

Despite the excellent free training programs available through NRED, the Board refused to allow owners to see how they were being trained to abdicate their decision-making authority.

And the the Board certainly didn’t want owners to be able to comment on the self-serving training that was provided by Clarkson so it was deemed “attorney-client confidential” even though the training packet began with a legal disclaimer.

NRED complaint still pending

The secret Clarkson training was a self-dealing disaster. It bordered on elder abuse, and my complaints about the abusive conduct at that July 25, 2017 “attorney-client-privileged, not-an-executive-session workshop” are still under investigation by NRED.

Naturally, Adam Clarkson is billing the association ($325/hour, thank you very much) to defend himself and the other perps from my complaints about being bullied and harassed in that session in retribution for my telling the lot of them that they needed to straighten up and follow the spirit as well as the letter of the law.

What was wrong with the way Clarkson trained the Board?

Setting aside the for the moment the attorney-led misconduct of the participants (shunning, threatening and bullying me), Adam Clarkson twisted the interpretation of the law so far as to assert that it was a violation of the Board’s fiduciary duty to act ON ANYTHING without the attorney’s blessing.

Reward for complicity

Adam Clarkson rewarded the Board members who fell for his money grab, by creating a punitive cone of silence around non-confidential, discoverable SCA records against the non-compliant Director. Clarkson has also given his blessing to the unlawful claims that

  • the GM controls which owner or Board member can access SCA records and can withhold records at will, including in violation of a court order
  • the GM, President or Secretary
    • can exclude a Board member from Board meetings, and
    • can prevent a Director from voting,
    • and can block a Director from placing items on a Board meeting agenda
    • and can falsify the minutes of those meetings
  • the President does not have to follow Parliamentary procedures and
    • can magically use non-existent “substitute motions” and
    • can block a vote on a Director’s seconded motion and
    • can prevent a nomination for an officer position that would compete with the President’s pre-selected slate.
  • Annual reporting of gifts is voluntary

What does “fiduciary duty” mean?

Adam Clarkson actually gave this self-dealing definition of fiduciary duty saying that being guided by legal professionals was required by law AS IF only lawyers were experts on every subject.

The legal requirement is actually to consult with appropriate experts of all types (not just attorneys) when it is prudent to do so. This means reserve specialists, HR experts, accountants, construction experts, not just attorneys. There is no legal requirement for a Board to delegate its decision-making authority to attorneys. In fact, it is prohibited by both NRS 116.3106 and SCA bylaws.

“Consult with appropriate professionals as necessary before making major decisions…”

And the definition of fiduciary really is focused on the duty of care that the fiduciary has to ACT SOLELY AND EXCLUSIVELY IN THE BEST INTEREST OF THE MEMBERSHIP.

A fiduciary is personally accountable for a duty of care and using good judgment to serve owners, not oneself.

It does not cut it to do (or not do) something that hurts the membership and then claim,

“The attorney made me do it.”

Defy the ruling of Judge (and jury) Adam Clarkson at your peril!!!

According to Adam Clarkson, attorneys are justified in verbally attacking and threatening a Director who tells the other members of the Board that:

  1. attorneys don’t have the expertise to assist on ALL Board decisions and that
  2. it is the individual Director’s responsibility to use common sense and ethical principles to evaluate courses of action to decide how to vote.

Give me a break. That’s idiotic.

We are actually paying $325/hour for that type of inane self-dealing pronouncement against a Director who tells the attorney to knock it off.

Guilty until proven innocent

“Unauthorized practice of law” for “advising other members that legal counsel is not necessary”????

“… will be deemed to have committed a prima facie violation of NRS 116.3103”?????

“Prima facie”  =  A fact presumed to be true unless it is disproved.

Quid pro quo = “something for something”

Quid

“Guilty until proven innocent” is the Clarkson pro forma edict he uses to bully Board members who are not in his or the GM’s pocket.

Quo

At the same time, Clarkson has protected the interests and defended the unlawful actions of the GM and those Board members who unquestioningly have agreed to pay whatever he bills with OPM (other people’s money).

“Prima facie” = “presumed guilty”

Here’s what NRS 116.3103 actually says

Clarkson is wrong

Telling the Board that the buck stops with it, and not with the attorney, is NOT a violation of a director’s fiduciary duty.

It is a true statement made on an informed basis, in good faith, and in the honest belief that

  • getting attorneys out making decisions for management or the Board, and
  • preventing attorneys from self-dealing or
  • serving the personal interests of a few individuals over the interests of the membership

is acting in the best interests of the association.