Judge compares Homeowner Association to
Article Courtesy of AHRC News Services

Posted March 14, 2003: 

Santa Ana, CA - Some homeowners in the Villa Point Condominium Association located in Newport Beach, California, got a rude shock when they launched a recall petition against the board. The homeowner association sued to stop them having the recall. At a hearing in Orange County Superior Court on February 4, 2003, the homeowner association got an even more rude shock - the judge dismissed its lawsuit against the homeowners seeking the recall. 

Under questioning by the judge, one of the association's attorneys, Dean Smart, admitted that when the homeowners had filed their petition for a recall, the president of the association and another director had gone around knocking on the doors of some of those who had signed the petition. The judge responded: 

"Does that strike you in any way, shape or form as something akin to what you might find in some banana republic? I'm not talking about a store that you go shopping in, but I'm talking about one of those places down in Central America where the government, basically, has hit squads, and if they don't like what you said, they take you out in the forest and they put a bullet in the back of your head." 

Dean Smart, the homeowner association attorney, was quite startled and replied: 

"Well, your honor, no, it is not, because that is not the situation. We're talking about an extremely up-scale community within Newport Beach where the board members themselves are upstanding members of the community." 

The judge was apparently not very impressed with these credentials. He went on to say: 

"I guess what you're telling me is two of the guys against whom these complaints were being made, go and knock on the door and basically say to the person who allegedly signed the petition, did you sign that petition and how dare you do that, or words generally to that effect. And I don't know the people at this point, but you know, my experience in this human existence, people tend to shrink from people who are potentially in a position to retaliate. 

An so I guess my initial reaction - my gut-level reaction is what kind of investigation was this when, basically, the accused are conducting the investigation and the accused are the people in power? Again, my banana republic analogy might be better suited to, shall we say, something with the Balkans where this sort of thing goes on." 

Michael Perry, the other homeowner association lawyer, then suggested that the homeowners could be questioned in a deposition regarding the validity of the signatures that they had collected for the recall. The judge was having nothing of it. 

"So stated in a slightly different way, sign a petition for election and face the Spanish Inquisition of a deposition in a lawyer's office at a date you might not like, and certainly a place you might not like. I'm not sure that this is a real democratic process as was just described to me." 

The judge then threw out the homeowner association's case and granted costs and fees to the homeowners. 

The original case had been brought by the law firm of Neuland, Nordberg and Andrews. Both Smart and Perry worked for this law firm. Even though they stated to the court that they have now formed their own law firm, the California Bar Association still shows them as working for the Neuland firm. AHRC News Services has not yet been able to determine if they actually are a new law firm, what their relation is with the Neuland firm, or the circumstances of their separation. 

Neuland and Nordberg are familiar names in homeowner association lawsuits in Southern California. For years, homeowners have complained that these two lawyers are repeatedly filing suits against homeowners and draining association reserves for their lawyers' fees. Both are longtime CAI lawyers - the nationwide trade lobby of collection lawyers for homeowner associations. 

Neuland is shown in a photo lobbying the former chair of the California Assembly Housing Committee, Dan Hauser, in Sacramento. On this particular occasion, Nordberg and other fellow CAI lobbyists such as Richard Fiori, hosted and toasted Dan Hauser to a sumptuous dinner the night before a crucial hearing on one of their pro-CAI housing bills. The following morning, Hauser passed their bill. 

The homeowners of Villa Point may still not be out of the woods, as Dean Smart threatened to file another lawsuit contesting the election if the homeowners won. The homeowners have spent $15,000 of their own money so far, and say that they do not know how much of their money the association has spent on legal fees for this lawsuit because the association has denied them access to the association books and records. 

But they are cheered by their legal victory, even though they have had to spend so much to defend their basic democratic rights.