Making owners pay to fight owners knowing how our money is spent

A point for transparent Nevada

The R-J just won a victory for transparency when the District Attorney was required to release information about how much the DA’s office was compensating witnesses in criminal trials.

Public interest
Using taxpayer cash to fight the taxpayer
Click on photo to read full editorial

 

“To sum it up, the taxpayer-funded prosecutor’s office sought to conceal from taxpayers certain payments it made with taxpayer money – and then eventually cut a deal that will cost taxpayers $55,000 (in attorney fees).”

 

“Wouldn’t it have been easier – and cheaper – for those in the DA’s office to simply have made the information available in the first place? Instead, the default setting is always to retreat into the shadows and make liberal use of other people’s money to fight against open government.”

Sound familiar, Mr. Clarkson?

It should.  Sun City Anthem Board and GM are misusing the SCA attorney to hide their sins, and he is laughing all the way to the bank.

SCA’s leaders are wasting owners’ money to hide information which should be easily accessible to us at virtually no cost on the website.

SCA’s brand of mean-spirited opacity- hiding actions and expenditures from owners and making the owners pay the attorney fees for hiding what could even be unlawful or fraudulent – has more elements of sleaziness than I saw in the government’s efforts to avoid transparency.

SCA has gone beyond the practice of merely blocking freedom of information requests as described in the R-J editorial to being outright abusive to owners who just ask for information they have a legal right to receive and distribute as they wish.

For example, the claim on the new SCA Records Request Form that SCA records that might be requested, such as employee compensation, are “private and confidential records of the private entity that is the association” is simply false.

Those records can’t be confidential by Nevada law in Sun City Anthem and not confidential by that same Nevada law in Sun City Summerlin.

Threats of litigation?

I don’t see that the Public Employees Retirement System threatened the R-J with punitive sanctions for just submitting a Freedom of Information Request like our mean-spirited leaders are doing to SCA owners, threatening litigation for even asking for information the GM or individual Board members want to be publicly known.

GM’s “privacy rights” bigger than owners’ rights?

I also don’t see that the government officials ever claim that freedom of information requests violated some imaginary and legally-unsupported “personal privacy rights” as SCA’s attorney has done on behalf of the GM.

Only withhold records from certain parties?

I don’t see that the District Attorney claimed the requested information could be withheld from the R-J, but that it could be released to the R-J’s competitor? SCA has done this very thing repeatedly by providing information to OSCAR (recall opponents) that was withheld from others who were not in that camp.

Making up laws?

I also don’t see that the District Attorney just made up some bogus legal  requirement that the R-J acknowledge that the information can’t be used in ways the DA would consider harassment or even just embarrassing. The new SCA information request form contains multiple ridiculous “acknowledgements” which have no basis in law.

The SCA attorney is lying to owners about what owners’  rights are. Fines and other sanctions are threatened against  SCA owners for requesting and disseminating information, both of which are within fully within owners’ legal rights.

For example, the claim that SCA CC&R 3.6(h) and SCA Rules & Regs 9.4 would be violated and an owner subjected to penalties for violating any of the totally fabricatedduty, restriction and/or obligation provided herein” is a double whammy of threatening an owner for violating restrictions the attorney just made up out of thin air. 

Magically creating privilege?

I also don’t see any egregious claim by Clark County that documents, actions or conversations become privileged just because the secretive official wishes that they were legally protected from public view as the Clarkson Law Group, the GM and individual members of the Board ludicrously and repeatedly do to unlawfully attack owners for exercising our legal rights.

 Ask any Discovery Commissioner

The burden of proof that documents, conversations or actions are legally privileged falls squarely on the party who is seeking protection from disclosure.

Not the other way around.

Being accountable for being good neighbors

Is a criminal-to-excellence measuring scale hard to understand?

It seems to be hard for the people currently in power here to grasp.

But, the association (meaning the membership) faces a very high risk if the Board, GM, and attorney are not held accountable for being ethical and fair.

With so much a secret, who can be held to account?

I invite you to look again at my  blog, The Cautionary Tale of the City of Bell.

Although SCA is a non-profit corporation that privately delivers municipal services rather than a city per se, SCA has hallmarks that mirror the City of Bell’s textbook case of municipal corruption:

  • laws are bent to serve executive’s private interests
  • those in power act in concert for self-interest
  • excessive executive compensation
  • disenfranchising of unsophisticated and inattentive voters
  • election interference
  • lack of transparency

Mmm…how can I make this clearer?

I know. Let’s discuss a fun fact about bestiality.

Did you know that until AB 391 passed last year, and became effective October 1, 2017, it wasn’t against the law in Nevada to have sex with a dog?

It’s pretty weird that it wasn’t illegal until a few months ago, but, I think we can all agree that,

just because you could have, doesn’t mean you should have.

Let’s take this tale a step further.
What if…

…before Nevada’s anti-bestiality law passed, a neighbor was disturbed by the noise of a dog whining. When the neighbor realized what was happening, he complained around the neighborhood that such conduct should not be allowed.

The neighbor complained strenuously that it was cruel and abusive to the animal, and offensive to community values.

Instead of apologizing or showing any shame or remorse, the “dog lover” was rude and insulting to the neighbor, flaunting his “rights” and saying in an arrogant and condescending tone:

“Shut up. I can do to my dog whatever I want. I do not have to change my ways just because some whiner complains about having to witness how much I really love my dog. My attorney says the law is on my side. You have invaded my privacy and defamed me. I’ll tell everybody you are a horrible busybody, and they’ll hate you. I’m going to sue you, and you will have to pay all my attorney fees.”

Your Ethics 101 Exam Questions
  1. How would you rate the dog lover‘s behavior on a criminal-to-excellent-neighbor scale?
  2. How would you rate the neighbor’s behavior?
  3. Should the neighbor have to pay the attorney fees?
  4. How could this situation have been handled better?

Even if the selfish dog lover had not technically broken any Nevada law, I think we can all agree that he was wrong to abuse the dog, and that he made everything about the situation worse by unfairly stomping on the aghast neighbor.

The moral of this tale

What the Board, the GM, and the attorney did felt to me as exactly comparable to how the dog lover retaliated against his neighbor for complaining. They bullied me, shunned me, threatened me with litigation and liability for attorney fees for speaking up when I saw things that were just plain wrong – just like the dog lover treated his neighbor.

SCA leaders must be held to a higher standard.

You can help. Vote. Raise our standards.
Bob Burch and Aletta Waterhouse should not be re-elected just because they have not had sex with their dogs.

HOA collection practices cost us all more than you think

What makes our property values go down?

There has been a lot of concern expressed about how having – or not having – a restaurant lowers property values.

There have also been concerns expressed that owners calling for a removal election or complaining about how they were being treated would make this community unattractive to purchasers.

I think those issues, as serious as they are, pale in comparison to the impact HOA collection practices, including SCA’s, have had in suppressing the property values in HOAs statewide.

The Reno Gazette-Journal reported last July that an  academic study provides evidence for this claim.

Click here for the  7/7/17 Reno Gazette-Journal news article that ran under the headline:

HOA foreclosures tied to more than $1B in lost Reno, Vegas home values

In my blog The house that took over a life“, I wrote about how my late fiance Bruce’s house was snatched by SCA’s former agents and sold for pennies on the dollar.

You might have felt bad for me, but you probably didn’t think that foreclosure, and the other foreclosures that have occurred, lowered your property value as well.

The recent study by UNLV LIED Institute for Real Estate and Nevada Association of Realtors claims it did.

In fact, the study supports the claim that the entire system is flawed, and ALL homeowners pay a price every time their HOA’s debt collector kicks an owner out of their home and then (on the owners’ dime) tries to beat the bank out of their security interest in court.

Survey says:
Homeowners are not happy with HOAs

Part of the research included surveys of Clark and Washoe County residents that I’ll report in another blog, but generally, those surveyed were not pleased with HOAs.

In particular, those academics’ research (Click here for executive summary of report) showed that many Nevada residents (81%) are unhappy with HOAs’ having “super-priority” status to foreclose for delinquent assessments because it hurts them (all the other owners in the HOAs).

One of the study’s conclusions:

“The LIED Institute found that every HOA foreclosure reduces the sale price of every property in the HOA by 1.7%. Thus, LIED inferred that every property, even the ones that have not sold, has suffered this same value reduction. “

           –Analysis of HOA foreclosures in Clark and Washoe counties from 1/1/13-6/30/16 

At least $1 Billion Loss in Clark & Washoe Counties alone

What happened to my late fiance’s house as well as my analysis of public records of multiple foreclosed properties has led me to conclude that this finding,

…every HOA foreclosure reduces the sale price of every property in the HOA by 1.7%“,

underestimates the impact on ALL homeowners’ property values by a large margin.

But, I’ll share that analysis with you in another blog.

We ALL pay

Those personally victimized by unfair HOA foreclosures are not the only ones damaged financially by them. My detailed review of the study shows there were even more significant financial impacts on ALL HOA homeowners statewide, and from more causes, than those identified in the UNLV/NAR study.

Why do HOA foreclosures lower property values?

The study identifies a few major reasons why HOA foreclosures bring down the values of ALL properties in the HOAs:

  1. Depressed sales price – Properties are sold at HOA sales for a  small fraction of the property’s fair market value (FMV). Since the buyer pays pennies on the dollar of what it is worth, ALL community property values go down.
    Study says: Every home in an HOA loses 1.7% when the HOA forecloses.
  2. Banks charge more for loans in HOAs to cover the risk of loss if the HOA forecloses. HOAs’ super-priority extinguishes the bank’s security interest (mortgage) and the study estimated how much banks have lost after  the banks’ loans were cancelled.
    Study says: Banks lose 100% of the loan balance on every property sold at an HOA sale, and Federal and Nevada courts disagree about how to handle this.
  3. Corruption within HOAs, particularly when management agents have a financial connection with the debt collection agent as was happening at SCA until 2015 when FSR, our managing agent, was financially intertwined with, and was the license-holder for SCA debt collector, Red Rock Financial Services
    Study says:

“…80% of respondents would support a law prohibiting HOA management companies from also owning and operating their own HOA collection agencies.” 

So what?

This series of blogs is intended to put SCA’s collection practices within a much larger context so you can see how we are all affected.

  • SCA is just one of over 2,500 HOAs in Nevada in the LIED database.
  • Nevada is just one of 22 states that have huge problems with HOA agents, using the HOA’s power to foreclose, such that

1) both the homeowner and the bank lose 100% of their property, 2) the HOA gets very little they are owed, and
3) the debt collector gets very, very rich, frequently by taking more money under the table than the law allows them to charge.

  • My late fiance’s house is just one little house, but it is a stark example of what happened many thousands of times in the wake of the 2008 economic collapse.
The foreclosure system is broken and needs to be fixed

Whenever you have economic turmoil and large reversals of fortune, you have a breeding ground for corruption. I want to show you how the limitations in the legal and judicial system have allowed some unscrupulous individuals (and institutions) to wildly profit at your expense and mine.

Did SCA Board members profit at owners’ expense?

No. Certainly not me.
I did not, and will not, profit from exposing any of this.

No other SCA Director profited from any of this either.

As you peruse these next few blogs about how SCA collection practices affect your personal bottom line, please note:

  1. I did not ever place a matter before the SCA Board from which I made, or could have made, any profit. No matter what action the SCA Board takes, or doesn’t take, related to collections or foreclosures has any impact on the quiet title decision of Judge Kishner, Nevada 8th district Court.
  2. I don’t believe any current or former SCA Board member personally profited from the foreclosure of any SCA property.
  3. I believe SCA Board members have simply trusted and followed the advice of SCA’s agents without suspecting that the agents had set the process up to unjustly enrich themselves.
  4. I don’t believe anyone on the current SCA Board understands that the SCA Board has legal alternatives for handling collections that could prevent many of the downsides using self-serving debt collectors who unfairly profit from foreclosures and the huge volume of litigation that ensues.
  5. However, I believe the current SCA Board is culpable for REFUSING to even examine flaws in SCA’s collection system or to consider more humane options which would benefit ALL SCA homeowners financially more than SCA’s agents benefit.

HOA Boards and homeowners have frequently been victimized by their agents (managers, debt collectors and attorneys) who can take advantage of their ignorance or inattention.

The HOA Board must ensure all assessments are collected. That’s a given.

But, in general, volunteer boards do not have the expertise to select the most cost-effective and humane method for doing so.

Our SCA Board has been duped by all three (or four or five) debt collectors SCA has used. They have all unjustly profited by conducting foreclosures without following the statutes, by retaining proceeds from the sales that they were not legally entitled to, and/or by tricking the Board into believing that their costly methods were the only legal option.

Our cost when agents serve themselves

It’s tragic how easy it is for HOA agents who play fast and loose with the law to unjustly enrich themselves. Lax enforcement of the laws on the books, such as they are, is ineffective to stop their fingers from reaching into our pockets.

Statewide, a much stronger regulatory system is needed to prevent such institutionalized corruption from getting a stronghold, and to protect HOAs and homeowners from getting ripped off.

Why would a debt-collecting agent derail his gravy train?

Telling the SCA Board that there are more cost-effective options to successfully collect assessments than using the SCA association legal counsel as the debt collector would drastic reduce The Clarkson Law Group’s big, fat bottom line.

Agents are supposed to act solely and exclusively for the benefit of association membership, but the temptations for a quick buck are just too great!

It’s much more lucrative to keep the Board in the dark about how much the costs of collection exceed the amounts collected.

Or better yet, the attorney/debt collector can bully the HOA Board into believing he is the final authority and that the lucrative (for attorneys) litigious process is only legal option available.

Sound familiar, Mr. Clarkson?

 

 

 

 

 

 

 

Legal fees beget more legal fees – $80,000 in two months!!!

Giving attorneys a blank check = bad idea

In the first two months of the fiscal year, SCA’s spending $79,760 for legal services. Attorneys have burned through 40% of the $195,000 budget for the whole year.

Had the 2018 budget not be more than doubled from the 2017 level, the burn rate would have been a whopping 89%.

2017 Legal services budget was $90,000, an amount that prior Boards fond to be adequate for SCA’s needs.

Was the service SCA got worth it?

  • Do you feel like paying this attorney has improved the quality of your life in Sun City Anthem?
  • Do you think, as this current Board does, that the attorney must be retained to do work that is normally performed by a Community Association Manager, like propose towing or publication policies?
  • Do you believe that the Board is incapable of making decisions unless the attorney approves them?
  • Do you think SCA owners should pay for the association attorney to represent the GM to protect her “privacy rights” against owners finding out what she is being paid in 2018?
  • My best guess is that SCA has been billed in the tens of thousands of dollars for the GM to use the  association attorney to keep her secrets. I can’t be more precise because when I requested an explanation for spending $321,000 instead of less than $90, 000 in 2017,  the response boiled down to:

“We don’t have to. You can’t make me”

2017 legal expenditures exceeded $321,000

This was a whopping 3 1/2 times the $90,000 budget! So, one would think that the correct response would be to look at ways to bring that number back in line. But, that wasn’t what the Board did. They more than doubled the 2018 budget to $195,000. 

While a strategy of carefully calculating the increases needed in the budget to cover runaway costs may be prudent in a strictly fiscal sense, it completely ignores the Board’s duty to analyze the root causes of why we are wasting so much money on attorney fees.

Last year’s waste blew my mind, and this year is starting out even worse.

What I told the Board at the 3/22/18 meeting

The Board and the GM are using attorneys excessively, inappropriately and in a manner which is not serving owners well.

The Board is not following the business judgment rule if you:

  • Use attorneys to conceal from owners how our money is being spent when you are required by law to tell us.
  • Allow the GM to use the association attorney to serve her own purposes in violation of SCA’s bylaws and the Board policy manual, e.g., relieving the Election Committee of their duties in the recall election ($90,000 spent on her order), and at least $50,000 to conceal records from me as a director, and threaten frivolous litigation, and unfairly remove me
  • Accept without question demands for payment for unbudgeted services which others who are not being paid tell you, are not necessary or cost-effective if done by attorneys.
  • Ignore warnings of inappropriate expenditures
  • Refuse to allow any investigation by owners to determine the veracity of the complaints that these fees are out of line.
  • Refuse to have a Legal Services Committee to provide owner oversight to protect the Association.

The Board silently noted and (round)filed.

I predict no action will be taken to control the costs of control.

And another thing

Why did owners have to pay $43,022 to write-off bad debts last month?

When this amount was written off, Forrest said that it had largely been due to foreclosures by banks.

  • What properties were affected?
  • Why so much write off?
  • Was litigation involved?

My questions  could be answered if the Board would require the GM/attorney/debt collector to publish the quarterly delinquency report mandated by our bylaws and keep them posted on the website.

Refusing to manage the attorney instead of letting him run amuck is costing owners money unnecessarily. It is not a good example of sound business judgment.

Bylaws 3.21 (f) (5) Quarterly reporting requirement

…(quarterly) commencing at the end of the quarter in which the first Lot is sold and closed,…(v) a delinquency report listing all Owners who are delinquent in paying any assessments at the time of the report and describing the status of any action to collect such assessments which remain delinquent…

Publishing the required report would improve the cost-effectiveness of collection efforts significantly, reducing attorney/debt collector fees and uncollectible debts.

But this isn’t something you will hear from the attorney.

Telling lies, ruining lives

“As I understand it, Ms. Tobin was prevented from running for the Board not because she has opinions that are critical of the Board and SCA management, but ONLY because she is involved in litigation against SCA from which she might stand to gain a financial benefit.” -David Berman

Poppycock.

My unlawful removal from the Board was completely 100% done in retaliation for my complaints of harassment and retaliation.

I presented the issues formally to the Board, the attorney, the GM, and the former CAM and to blogger David Berman as statements of intent less than two weeks before they acted in concert, without cause, without authority and without due process to strip me of my legal rights and my Board seat and to disenfranchise the 2,001 voters who had put me in office.

While I was on the Board those interminable 116 days (5/1/17-8/24/17), the GM, the former CAM, the attorney, David Berman and 5 of the 7 directors acted in concert to marginalize me from day 1. (Art Lindberg should get a pass since he was the only one who asked the right questions. The attorney lied to him too., and the pressure to conform was very, very strong.)

They made my life miserable, shunning, lying, berating me, denigrating my contributions, making false accusations, publishing false and defamatory statements, and making it impossible for me to be an effective homeowner advocate as a member of the Board.

They only came up with the convoluted ruse that I had put matters before the Board from which I could make a profit because, even relying on Adam Clarkson’s tortured reading of the law, they couldn’t say they were getting rid of me because I was an outspoken pain in the ass.

Execution was a complete non sequitur

The 8/24/17 letter which constituted my walking papers, signed by Adam Clarkson, was the totally unlawful and unethical response to my notice of intent to file a Form 530 Intervention Affidavit alleging harassment and retaliation.

Before that letter came out of the blue, there were many disputes between me and five of the other Directors, the attorney, the GM and former CAM, most of which you will recognize. I was transparent and vocal as possible as I sounded the alarm on deferred attention to owners’ concerns.

It’s pretty obvious why I had to go

And it was not because I did, or even could, profit from being on the Board.
My profit = ZERO

Did I mention I never made a dime off SCA before, during or after my Board service?

How much did the attorney make for creating the ruse that I did?

Attorneys’ profit for 2017 = $300,000+

2017 legal fees for “Director Issues”  = $40,000
January 2018 legal fees = $38,000

but they won’t admit how much of that was to unlawfully block owners knowing how much the GM’s salary was bumped up in 2018

Deny. Deny. Deny.

Accept no responsibility for ANY problems.
Then attack your accuser.
And kill her.
Sample of the problems I publicly said needed correction
  • No restaurant -Failing to comply with the CC&Rs and good business practices about the restaurant space study, letting only a couple of directors work on it, refusing to use an independent expert, too cozy with one bidder
  • Owner oversight committees – Refusing to allow appropriate owner oversight in areas where going to self-managed and changing legal counsel and debt collectors caused a high level of risk – personnel, compensation, legal services, insurance, investments; getting rid of the Golf Course Liaison Committee, the Communications Committee, and decimating Property & Grounds, making the GM the Board liaison to Pinnacle and other groups
  • Board agendas – Refusing to put my items on the Board’s open or executive session agenda as required by law, by Board policy equal to other directors
  • Secret meetings -meeting in secret without giving me or other owners the rights guaranteed by law or confining executive sessions to the four permissible topics
  • Excessive executive compensation – Refusing to conform to the law for access to data, to evaluate according to professional standards, or to fairly consider evidence to rebut the appropriateness of those salary levels; giving Tom Nissen excessive authority in this area and blocking me totally from it despite our differences in expertise or the appropriateness of substituting the judgment of ANY one director for the judgment of the Board; spending thousands on using the attorney to hide what her actual compensation is from the owners.
  • No GM performance standards – Not holding the GM accountable for meeting measurable, publicly-adopted performance standards
  • No management agreement – Violating SCA bylaws and failing to protect SCA by having no management agreement or even any written terms & conditions of employment. Although the GM is an AT-WILL EMPLOYEE, allowing her to usurp additional privilege to the detriment of SCA.
  • Unfair complaint process – Going beyond NOT having a customer-service rating system to aggressively attacking the 800+ owners who signed petitions and refusing to answer any of their complaints on their merits
  • Evicting FAS – The process for evicting the Foundation Assisting Seniors was flawed. They ordered me out of executive sessions. They did not act in the best interests of the homeowners. The GM was not held accountable for the failure. Civil action without required owner vote.
  • Debt collection process – Failing to do proper due diligence on debt collectors; refusing to evaluate the expensive, inhumane cost of collection for a more ocst-effective solution
  • Ill-advised recusal demand – Overreaching demand for me to recuse myself on ANY collection matter because SCA’s attorney/debt collector alleges there might be an “appearance of a conflict” for me, however remote, while ignoring the current attorney/debt collector’s obvious actual financial conflict and the fact that the last debt collector filed for chapter 7 bankruptcy without telling SCA and continued doing foreclosures by morphing into another LLC.
  • Bullying -On at least three occasions in executive sessions, using bullying, shunning, intimidation, threats and other demeaning and belittling marginalization tactics to try to make me conform with nonexistent policies or legal requirements
  • Failure to investigate – When problems are brought up, they are dismissed out of hand without conducting, or allowing, investigation on the merits
  • Inaccurate official records -Causing, or allowing the official SCA records to be corrupted and/or error-prone ALWAYS against the interests of homeowners and usually to protect individual members of the Board or management
  • Concealing SCA records from me alone, i.e., giving me incomplete executive session Board books, refusing to respond to ANY records requests
  • Abdication – Allowing the GM to use the association attorney as her personal attorney in violation of NRS and SCA bylaws
  • Election interference – Allowing the Board president, the GM, the CAM, David Berman, and the association attorney to interfere with the recall election process and to UNLAWFULLY COST OWNERS $90,000 BY STRIPPING THE VOLUNTEER ELECTION COMMITTEE OF THEIR CHARTER DUTIES to pay a CPA to do the EC’s job poorly.
  • Undue influence allowed – As it served the interests of the Board majority and management, David Berman, spokesperson for OSCAR, was allowed to have greater access to recall election information than I received as a director; he was allowed undue level of influence over the Election Committee to cut me out in retaliation for my attempting to protect the rights of the petitioners, including falsely accusing me what he himself was guilty of;  misrepresenting himself as an attorney; falsely accusing me of releasing “personal director correspondence” further defaming me by creating the false impression that I had released a legally privileged documents (absolutely not!)
  • Sanctions without notice or due process -Having meetings to sanction me without notice and to enforce policies that don’t exist
  • Unlawful orders issued by the attorney against me, e.g., cease & desist from representing myself as a director, or asking questions that I was not “authorized” to ask particularly regarding personnel and GM compensation
  • GM’s frivolous litigation threats – Allowing the GM to threaten to sue SCA for damages and to threaten me with personal liability; refusing to indemnify me as a director; falsely claiming I had violated my fiduciary duty without any evidence, a hearing or a finding
  • Misinterpretation of “employer liability” – Allowing the attorney to represent the interests of the GM over those of the homeowners. Accusing me of violating my fiduciary duty because I criticized the GM’s performance and because I requested a salary verification from her prior employer.
  • Abdication to attorney acting in the GM’s or his own interest -Telling me that the attorney had the authority to declare that I, as one of the seven directors, could be excluded from the right to vote on, or even know about, matters under the Board’s decision-making authority, unless he approved it (which in most cases, he has never approved to this day).
  • Abuse of privilege -Allowing the attorney to declare ANYTHING to be “attorney-client privileged” regardless of the lack of its meeting the legal definition of privilege in NRS 49 or NRS 116.31085.
  • Falsification of litigation reports -Allowing the attorneys to publish false statements in the litigation reports to increase the appearance of a conflict or to defame me and refusing to correct after evidence was provided.

It’s pretty obvious why I had to go

Let them eat cake: learning how to be fair

When I was 12, my mother was killed in an United Airlines plane crash, leaving by father bereft with six kids ages 5 – 16 to raise alone. At 52, he had just retired a Colonel from the Air Force and was starting a private practice as a physician. He needed to have a way that we kids could get along and learn to treat each other fairly without him always having to resolve disputes.

I remember one system we used that taught us all to be more fair than we would have been if our dad had let the big kids rip the little kids off and hog up a pig’s share of a cake:

Whoever cuts the cake, gets the last piece.

This is a lesson that those in power at SCA need to learn if self-management is to succeed.

What’s wrong with the SCA system of “self-management”?

First and foremost, SCA is not fair. The big kids (the Board, the GM, and the attorney) are bullying the little kids (owners, residents and dissenting directors) to hog up all the cake that rightly belongs to owners.

  • The Board President is running amuck, consolidating power by controlling who can participate in decision-making by creating Board work groups and blocking owner-oversight committees.
  • The Board President is also misusing his power to disenfranchise political opponents and to silence opposition to the “party line”.
  • By disempowering appropriate owner oversight, executive limitations are poorly defined and internal controls are inadequate to ensure fair and equitable treatment of ALL owners.
  • The Board majority is just going along with the bullying and hogging up the cake “on the advice of counsel”.
  • The GM has been allowed to use the association attorney as her personal attorney (at owners’ expense), and is stealing the Owners’ cake and beating the crap out of the little kids who cry, i.e., owners /residents /board members who complain about non-owners grabbing their cake.
  • The association attorney has shoved a very big piece of the SCA Owners’ cake into his own mouth and grabbed another big piece for the GM while waving the knife threateningly at owners who even look at the cake, let alone try to get their fair share.
Owners pay dearly for having no control over their own cake

Here are some examples of problems with the implementation of self-management caused by the Board’s enabling the GM’s resistance to appropriate owner oversight.

  1. Owners pay for everything, but can be blocked from even knowing what they are paying for or how much they are paying.
  2. There is no way to control excessive executive compensation.
  3. The Board can act in ways that create liability or don’t protect SCA against manageable risks and the owners just have to shut up and pay for it.
  4. There is no way to hold the Board, the GM, and the attorney accountable as fiduciaries or to prevent them from abusing their positions for their own profit or personal or political power.
  5. Owners can be unfairly treated without being afforded the due process required by law.

The SYSTEM must build in controls so it is fair no matter who is in charge.

SCA does not have a system in place that protects owners from the very people who are supposed to be acting only for us.

If the interests of owners are adverse to those the GM or the Board President, then there is NOTHING built into SCA’s version of self-management to ensure that the owners’ interests will prevail.

In fact, with Adam Clarkson and Sandy Seddon calling the shots, there is no owner-protection system in place at all.

 

 

 

 

 

 

 

SCA Board election choices are narrowed by design

My granddaughter is six now, but a while ago, she loved knock-knock jokes. Her favorite one was apropos of the SCA Board race.

  • Knock-knock.
  • Who’s there?
  • Broken pencil.
  • Broken pencil who?
  • Never mind. It’s pointless.

And yet, here I am. In Hawaii, but still knocking my head against the wall, trying to keep the SCA Board composition from being so blatantly manipulated.

I know no one will listen. I know that the sides have already been chosen. Lines have been drawn in the sand. Positions are entrenched.

It’s pointless. But I am still just OCD enough to need to put these points on the record – where they are out of reach of those who are distorting or concealing the official record for their own purposes.

Board candidates are disappeared

  • What happened to the two that applied but whose names were not released, but were just gone at the same time I was declared ineligible?
  • Why did Vickie Lisotto drop out?
  • Why didn’t more people apply who have voiced concerns about how self-management is being implemented without owners’ coming first?

Why won’t owners run for the Board:
Fear of facing a recall petition?

Apparently not.

Candidates Bob Burch and Aletta Waterhouse were themselves both subjects of the petitions signed by over 800 owners to remove them from the Board, but they decided to run again for another two-year term.

Amazing that over 800 owners signed petitions over a few Summer weeks to call for an election to remove Aletta Waterhouse and Bob Burch from the Board, but that did not deter them from running again.

Even more amazing. They were seemingly so untouched by the list of grievances in the petitions that they did not even deem those 800 owners’ complaints were worthy of being investigated or, if verified, addressed on their merits.

Not so amazing since they were completely secure in the fully-funded support of the GM and the attorney, they did not see any irony in how six directors voted in secret to remove me from my Board seat when ZERO owners signed a petition to call for my removal.

Did owners decide not to run because they saw what happened to a director that spoke her own mind?

From my perspective, the answer is obvious.

All the stops will be pulled out to protect a director who has closed ranks to march lockstep with the other Stepford directors to parrot the party line.

Step out of line, and you will be threatened. Privately berated and shunned. Publicly humiliated. Then you will be disappeared. No amount of owners’ money is too much to spend to force compliance to the party line. No rule of law. Total hard ball.

Would anyone bet a homeowner advocate could be effective on the SCA Board?

It is not a safe bet.

Not when six of the seven directors apparently can just secretly vote a dissident voice off the island. No trial. No finding. No process. No owner vote. Just goodbye. Can’t run again. Disappeared.

Not when Sun City Anthem has a blogger in Hedda Hopper’s McCarthy-era role to maintain a Black List.

…(to) actively oppose the election of any candidate who was tied to, or supported, the removal campaign.

Ask yourself…who’s spending owners’ money to control who sits on the Board?

Would Sandy Seddon have sicced attorney Adam Clarkson on a director who supported her getting paid double the market and wasn’t questioning her paying the CFO and Facilities Manager salaries that were also double the market rate?

Would President Rex Weddle have turned a blind eye to the GM using the attorney to authorize the expenditure of $90,000 to ensure that the recall election would fail and $40,000 – a combined $130,000 — to ensure that my removal by secret vote would succeed if our positions had been reversed?

Would he had let a dime of owners’ money be spent on the recall election if I, and not he, had been the subject of a recall petition?

How much would he have authorized expending of owners’ money  to pay the attorney to remove him if it were he, and not I, being falsely accused of making a profit from sitting on the Board?

Would attorney Adam Clarkson have assisted the GM to make a bogus threat of litigation against SCA, and a director individually, if they weren’t trying to silence that director who was questioning the legitimacy of both their actions while requesting information needed to make fully informed decisions?

Wouldn’t attorney Adam Clarkson also have profited from disappearing a demanding director to escape accounting for SCA owners’ being forced to expend

  • $300,000+ in 2017 legal fees, triple the budget
  • $38,000 in January 2018 legal fees alone to block 2018 changes to GM compensation
  • $90,000 to conduct the removal election which was solely caused by his and the GM’s decision to disempower the volunteer Election Committee?

 

 

How SCA agents need to be exposed like Harvey Weinstein was

And not how he exposed himself…

Last night during the Oscars, the comment,

If you can’t trust your agents, who can you trust?”

got a big laugh. Everyone knew that powerful Harvey Weinstein was brought down after decades of abusing his power broker position, as in:

You’ll never work in this town again!

Such threats, spoken or not, had long been sufficient to keep his “casting couch” an open secret.

And to keep those who were being hurt from being heard.

Same agent, different result

But uncomfortable laughter also came from many who knew that agents abuse clients in other subtler ways, such as by not protecting all their clients equally well thereby enabling a discriminatory system to endure and making big bucks while doing it.

Kevin Spacey was disappeared from the shooting of “All the money in the World” after being accused of sexual assault by some young men he was supposed to be mentoring. Scenes were reshot to put Christopher Plummer in to replace Spacey as the lead actor. Mark Wahlberg and Michelle Williams went back to work to do their parts again, but they were far from treated equally. A vast difference in compensation was negotiated by the same agency both of the two actors:

Mark Wahlberg paid $1.5M for film reshoot that earned Michelle Williams $1,000.

Wow. That seems so obviously not okay now, but it the not-too-distant past, it might have passed by unnoticed.  At least, for now, #MeToo and #TimesUp have created a cultural shift. The pendulum has swung to a point where such a disparity is worthy of comment.

Let’s hope SCA is able to move to such an awakening in my lifetime, and homeowners don’t have to face abuse at the hands of SCA’s agents.

Am I saying that some of SCA’s agents have been abusive?

Yes, actually I am saying that. And I’m saying it needs to stop now. Time’s up.

And I’m also saying that the current SCA Board, the current SCA legal counsel/debt collector and the current General Manager need to stop protecting themselves and each other.

Their job is to protect us. Homeowners should not have to spend one thin dime to be protected from them.

Why I am speaking up

Many Hollywood women came forward to expose Harvey Weinstein after one spoke up. I hope my story will resonate with homeowners, not just in Sun City Anthem, but also with homeowners in HOAs throughout Nevada and will inspire others to not be silent.

Bottom line:
SCA agents have had their hands in our pockets.

SCA’s former agents, without any of the prior Boards feeling a thing,  slipped a house or two that didn’t belong to them into their pants pocket, and one of them was mine.
Note: I’m not saying anything bad about prior SCA Board members. Not a single one ever took a dime. I’m sure of it.  And I don’t think they were negligent. There was so much chaos after the real estate market collapsed in 2008, no one knew the difference. I certainly wouldn’t have known or cared had not one of those stolen houses been directly under my care. 

Who cares now? 

When SCA replaced Red Rock in mid-2015, SCA went from the frying pan into the fire by hiring attorneys, Alessi & Koenig, to be our debt collectors. Then when I showed the Board and GM how bad these guys were, they did the unthinkable and made it worse by hiring a new debt collector to also be SCA’s corporate counsel instead of re-thinking the whole process.

OMG! David Alessi wasn’t licensed as an attorney in Nevada, was named in litigation by 500 of the 800 HOA foreclosures A&K did from 2011 to 2015 when SCA hired them. By 2016, they had morphed into another sham corporation, HOA Lawyers Group, before SCA finally let them go.

And still, SCA managed to get strapped into even a worse deal by contracting with the Clarkson Law Group to be both the debt collectors and corporate counsel.

In a stunning opening act of abusive overreach, Clarkson protected his business interests as well as those of SCA’s former agents by ordering me to recuse myself as a new Board member from ALL SCA collection matters.

Then, to protect the GM, he restricted my access to any SCA records and continues blocking access to GM compensation data to this day. He protected the Board majority from recall and caused the members to pay $85,000 for a CPA to bungle it.

Next, he used his corporate counsel magic powers to create a technical sleight of hand to knock me off the Board on false charges without a trial.

I’m the only attorney in this room. We’re in charge here. Shut up and get out.

How HOA foreclosures take money from all our pockets will be the next topic

A recent study showed that every home in that HOA loses an average of 1.7% of its value when there is a foreclosure by that HOA.

Next time I’ll break it down for you. I think you’ll see why Adam Clarkson, SCA’s current debt collector/legal counsel, is going to such extremes to try to silence me.

 

 

 

 

Who gets to decide who is eligible to serve on the Board?

Who authorized the Clarkson Law Group to block me from running for the Board?

Not the law. Not NRED. Not the SCA Board. I believe Adam Clarkson and his whole Law Group should be re-trained to better understand who their client is. No Association attorney has legal decision-making authority to control who is eligible to sit on a Board of Directors.

Follow this link for a 2012 article by Barbara Holland, “HOA directors should be held accountable“, in which she noted:

The majority of the people who have been found guilty in the current FBI investigation of the massive Southern Nevada HOA scandal have been on boards of directors.

Holland argued that HOAs needed to be protected from fraud, but note her warning about the potential for abuse

There should also be some discussion as to whether a homeowner should be disqualified from being placed on the ballot when he or she is currently in violation of the community’s governing documents.
Now, this is a touchy subject as this proposed law would be used improperly by HOA boards that could try and block homeowners from sitting on the board.

Why didn’t Clarkson disclose his former employment to SCA when it could be perceived as a potential conflict?

Adam Clarkson’s resume submitted to SCA during the 2017 RFP process did not disclose where he practiced law after he passed the Nevada bar in 2006 until 2014 when he incorporated the Clarkson law Group. Last September, AnthemOpinions reported that Clarkson was had been an associate attorney for the firm of Quon, Bruce, Christiansen early in his career.

Law Partner Nancy Quon was a principal player in the HOA corruption scandal from 2008 until her suicide in 2012. The massive conspiracy involved rigging HOA board elections and taking over HOA boards to steer legal and construction defects contracts to specific firms.

Adam Clarkson was never charged with a crime or even accused of knowing of the conspiracy that purportedly was led by Nancy Quon, a partner in the law firm that employed him. However, given the job Clarkson was applying for, shouldn’t he have disclosed to SCA, that his prior employment “would appear to a reasonable person to result in a potential conflict” ? Shouldn’t he held to as high a standard of disclose as he is imposing on me?

When I went on the Board, Clarkson demanded  that I “voluntarily” relinquish some of my legal rights to “avoid even the slightest appearance of a conflict” by signing an agreement to recuse myself from ALL SCA collection matters . This demand far exceeds the conflict of interest requirements in NRS 116.31084 and NRS 82 and seems pretty self-serving.

In fact, forcing me to recuse myself from current SCA collection matters did not protect SCA or homeowners one iota since my quiet title claim is for unlawful acts by SCA’s former agent, FSR.Stripping my access to information about collections as a Board member, and now trying to prevent my getting back on the Board, appears to a reasonable person to only protected Clarkson’s interests.

Clarkson Law Group is both SCA’s general counsel and debt collector which in my book creates a potential conflict of interest. Oh yeah, one of the ways Clarkson justified deeming my board position vacant was saying  I “put matters before the Board from which (I) stand to make a profit” when I proposed to the Board that some remedies to my complaint of harassment and retaliation would be to:

So who has the greater appearance of a conflict – me or Clarkson?

Clarkson has overstepped his authority

I am not in violation of any governing documents. I am a member in good standing. I have no financial claims against SCA. SCA is still in the quiet title litigation only because they refused at least eight attempts on my part to resolve the issue without litigation and before I got on the Board.

Why have homeowners had to pay the Clarkson Law Group tens of thousands of dollars to:

  • order me to cease and desist asking about the GMs excessive compensation
  • falsely accuse me of making a profit on my Board position,
  • having undisclosed  or “potential” conflicts, c
  • reating “employer liability”?

Did the Board declare me ineligible to run?

Not the Board. There was no Board vote to declare me ineligible to run.
At least there was no agenda or notice of a Board meeting to take such a vote.

There is no provision in law, SCA governing documents or SCA Board policy that creates a mechanism for the Board to take such an action. Compare this Clarkson/Seddon edict that I am ineligible with the FBI Russia investigation:

Even if the FBI investigation produced a finding that Russia manipulated the vote enough to make Trump win the Electoral College, there is still no mechanism in law for the Attorney General to invalidate the election, declare Trump ineligible, or to put Hillary Clinton in Trump’s place.

So, absent action by the Board, who decided I was ineligible and on what legal authority?

The GM, probably just did the same thing she did when she wanted legal cover for interfering in the recall election and cost homeowners $84,866 unbudgeted dollars to hire a CPA to make sure the recall failed.

But, given how Clarkson has buffaloed the Board into thinking that an Association attorney has higher decision-making authority than an Association Board, Clarkson might just as easily taken this action on his own initiative.

But whichever one did it, he or she acted without legal authority. And the Board let him or her or them do it.

Clarkson and the GM have done a fair amount of monetary damage to the Association that they have fought like hell to keep you all from finding out about.

I’m just saying.

Don’t you think it is weird that the same attorney who insists that I am a financial threat to SCA is the same joker who charged SCA $39,635 in 2017 for legal fees just to write me threatening letters and to help the GM threaten to sue SCA if the Board didn’t stop me from asking questions about her pay.

And it didn’t end. Clarkson sent me letter last month demanding that I  stop asking for SCA records that the law says are available to any owner. He sent another one to the KTNV keep Sandy Seddon’s pay confidential to protect her privacy. All SCA owners will have to pay $325/hour for these letters and for Clarkson to handle the NRED complaint. See a pattern?

Why is it a problem for the Board to act only “on the advice of counsel”?

Opportunity Costs – What owners had to give up to pay attorneys

A lot of it is unnecessary. A lot of it is by creating conflict, and common sense remedies are rebuffed. No effort to do best practices is rewarded when attorneys work on the principle of using the legal minimum as legal restraints.

This is the same guy that advised the Board that it was somehow magically exempt from black letter law in NRS 116 on such trivial matters as freedom of information and owner rights to know how their money is being spent.

This is same guy who says the GM can spend money that isn’t budgeted on her own initiative without measuring the opportunity cost to owner services where those funds were supposed to be spent. I personally would have much rather SCA spent some of the money that was wasted on attorney fees on

  • a better sound system for group exercise classrooms or
  • better pay for the fitness instructors or
  • enough funding to not cancel exercise classes.

This is the same guy who had no trouble with SCA’s 2017 expenditure for legal services that was triple the already ample $90,000 budget.

Really, in 2017, this Board expended 300% of what prior Boards needed to govern responsibly. Of course, those other Boards didn’t have a legal counsel who told them it was a violation of their fiduciary duty to make any decision without the approval of the attorney.

This same crackerjack attorney told me it would be considered practicing law without a license if I told people they didn’t need a legal opinion every time someone blew their nose.

My commitment is to owners

Whether I get on the Board or not, I will fight for Board action to

1) prevent the overuse of attorneys,
2) prohibit the GM from using the attorney as her personal counsel against the association or individuals or groups,
3) require the Board policy manual section 4.10 be rigorously followed,
4) prohibit the use of attorneys in debt collection  prior to foreclosure,
5) use foreclosure as a last resort and not ever to benefit the debt collector over the homeowners,
6) to get the NRED or CIC Commission to rule that any fines or monetary damages come out of the attorney’s pocket so that he not be paid for causing the Board to violate owner protection laws and that he not be paid for the unlawful, abusive and threatening letters he sent me both during and after my time on the Board.

What’s the big picture statewide?

This interference in HOA elections is a much bigger issue than what happens to me. It affects every HOA in Nevada. The Clarkson Law Group claims to represent 300+ associations in Nevada, an amazing career trajectory for  firm that incorporated only three years ago. Adam Clarkson is the President-elect of the Nevada Community Associations Institute, a lobbying group geared primarily to serve the interests of the HOA agents – attorneys, managers, debt collectors, construction defect-related agents. CAI is NOT a homeowner advocacy group.

If Clarkson is allowed to get away with influencing the composition of the SCA Board for his or the GM’s profit or to support the political advantage of compliant and docile Directors, he could do it anywhere.

In fact, I bet he already has.

 

.

Surprise! SCA attorney makes SCA membership pay to lose their voice!

What happened?

As I told you last week, I timely filed my application to be a candidate for the Board. Although I meet the legal requirements to be a candidate, two hours after the closing bell for applications, I received a 43-page document entitled Notice of Ineligibility, generated by the Clarkson Law Group @$325/hour to be fully paid for by SCA homeowners, that said I was disqualified to be a Board member.

Don’t I meet the legal requirements to be on the Board?

Absolutely. The law requires that I disclose that I am a member in good standing.

I am, and I did.

And the law and our bylaws require that I

“[m]ake a good faith effort to disclose any financial, business, professional or personal relationship or interest that would result or would appear to a reasonable person to result in a potential conflict of interest for the candidate if the candidate were to be elected”

I did. In fact, I disclosed everything twice.

First, using the official NRED form 850, I made my candidate disclosures in good faith on time, and, by law, SCA SHALL distribute the disclosures on my behalf because they include nothing defamatory, libelous or profane.

And, just to be safe, I voluntarily did a second set of disclosures, although the NRED Form 850 form I signed above clearly states:

“Any additional information provided by the candidate to the executive board is voluntary and is not a requirement under NRS 116.31034.”

I submitted the SCA candidate disclosure form (rev.2 by Clarkson Law Group, but not approved by the SCA Board) since Clarkson’s crafty, creative corruption of the candidate disclosure requirements had obviously been tailored to exclude little, old me from eligibility:

Clarkson’s creative editing tailors SCA’s disclosure form to create the appearance of a conflict of interest where no financial risk to SCA existed when I served on the SCA Board before nor would exist if I were elected again.
Why did the letter say I was ineligible to run for the Board?

These self-serving rationalizations to keep me off the Board aren’t true, of course, and they are more than a little infuriating to have to deal with.

I consider this action to block my candidacy, and to disenfranchise at least the 2,000 voters who elected me to the Board last May, further unlawful, defamatory, politically-motivated retaliation for my outspoken advocacy for homeowners’ rights and my progressively more strident demands that the Board, Adam Clarkson, and the GM hold themselves accountable to the homeowners and not to their own power trips or financial self-interest.

In fact, much bigger potential conflicts have not been disclosed by Adam Clarkson and Sandy Seddon, and they are the ones who are financially benefiting from making these false statements (that I’m making a profit off being on the Board or that I’m failing to disclose that I could hypothetically make a profit) to keep me off the Board and to keep me from disclosing how much money they are actually making off the homeowners.

Anyway, here’s the gist of what the attorney’s letter says about why letting me run for the Board would pose a massive threat to SCA:

  • You are ineligible because you stand to make a profit from matters before the Board:
  1. Your outstanding August 10, 2017 demand to the Association that included the following demand for monetary damages: SCA to pay damages for the GM’s, CAM’s, SCA attorney Adam Clarkson’s and the Board’s misconduct and intentional infliction of emotional distress, attorney fees and other costs associated with my defense against the unlawful abuse of process, defamation, libel and false claims that I committed illegal acts, violated my fiduciary duty or created employer liability.
  2. You have a pending quiet title claim against the Association and additional claims that may be asserted against the Association.
  • Failure to Disclose Potential Conflicts of Interest and False Statement of Fact

The candidate form you submitted failed to identify the potential conflicts of interest associated with your candidacy including, but not limited to, the following: 1) failure to disclose that on August 10, 2017 you made monetary demands upon the Association that remain outstanding. See Attachment 3; and 2) in relation to your litigation against the Association, the failure to indicate that your claims against the Association that were dismissed without prejudice may be reasserted against the Association subsequent to your completion of the Nevada Real Estate Division (“NRED”) alternative dispute resolution procedures under NRS 38.310 et seq. See the Notice of Entry of Order attached as Attachment 4.

Are there matters before the Board that I could make a profit from?

No.
What about the August 10, 2017 “demand for monetary damages?

On August 10, I sent a NOTICE OF INTENT TO FILE AN INTERVENTION AFFIDAVIT against the Board, the GM and Adam Clarkson for harassment and retaliation, for withholding  SCA records, excluding me from Board meetings, and other violations of their fiduciary duty.

Look at the date – 2 weeks before they kicked me off the Board as I walked into the August 24 Board meeting  – without any notice, due process, cause, or legal authority.  Kicking me off the Board was the Board’s only response to my complaint that I was being bullied and retaliated against, and now Clarkson is saying my requesting reimbursement of attorney fees is a demand for monetary damages that makes me ineligible to be on the Board.

That’s like beating someone up and throwing her out in the street, then beating her up again if she came back and wanted her hospital bills to be paid.

Look at what is actually being done here.
It could apply to any owner who speaks up.

I have no demand for monetary damages against SCA. Period.

Quiet title litigation is not disqualifying per se.
NRS 116.31084 says what to do if a Director might make a profit from being on the Board:
1) Disclose it, and 2) Don’t vote on it.

Done and done.

Here’s why the quiet title litigation is not a disqualifying conflict except in Clarkson’s mind.

  • SCA has no skin in the game. SCA was paid in full in 2014.
  • Nothing the Board has to decide will affect the outcome of the title decision that will be made by the court.
  • Judge Kishner is being asked to void a foreclosure sale defective because SCA’s former agents violated the statutory requirements for a valid sale.
  • SCA will lose nothing in the title dispute, It does not matter to SCA financially whether the judge quiets title to me, trustee of the Gordon B. Hansen Trust that owned it, to the bank, or to the guy who got the property on a fraudulent quit claim deed.
  • SCA will be out attorney fees which will be substantial because they are foolishly defending the former debt collectors who stole money from me on this one house, but stole from the Association on lots of houses.
What potential conflict of interest did I fail to disclose?

Nothing.
Accusing me of it is just wrong. The attorney’s logic is specious and speculative. All claims against SCA were dismissed at a hearing on May 25, 2017, except quiet title that SCA has no financial interest in, but SCA attorneys didn’t file the order until September 19, 2017, a month after they kicked me off the Board.  Why?

The attorneys have filed false litigation reports for the past year claiming that the current status of the case was back in February 1, 2017. Why?

The most recent litigation report defamed me by falsely stating that I had been removed from the Board for cause. Why?

When the Clarkson Law Group was hired, Adam Clarkson failed to disclose prior employment that would appear to a reasonable person to be a potential conflict of interest requiring disclosure. Why?

The blog, “Who gets to decide who is eligible to serve on the Board?“, discusses why the SCA membership has more to fear from over-compensated, power-grabbing attorneys than from me, a homeowner advocate who also is also trying to get title back to a house that was essentially stolen by SCA’s former debt collector.