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Courts tend to side with HOAs on disputes

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No one disputes that Country Squire Lakes Community in Jennings County has decayed from a pleasant welcoming place to live into a mess of broken down mobile homes where there is fear of crime.

They disagree if the change is radical enough to excuse homeowners from paying dues and assessments to their homeowners association.

In August, the Indiana Court of Appeals found a trial court had erred when it abrogated CSL resident Clarence Ray Meador’s obligation to pay the Country Squire Lakes Community Association Inc. dues that he owed. However it was not a unanimous ruling and Judge Terry Crone dissented, arguing the changes have been “far more radical than a mere ‘lack of recreational facilities.’”

bomberger Bomberger

The decision is not surprising since the courts often rule in favor of homeowners associations on appeal. Scott Tanner, the attorney representing CSL, does not expect that to change despite those times the trial courts have sided with the homeowners.

“I think it’s just because at the trial court level, a sympathetic judge is trying to give somebody a break and the homeowners association says that’s not the law,” he said.

A sad demise

CSL was founded in the 1970s as a gated residential vacation and retirement community on 1,400 acres dotted with woods and lakes. Early on, the community offered residents an array of recreational amenities such as an Olympic-sized swimming pool, tennis courts, playgrounds, beaches and a campground.

Today, the swimming pool has been filled in, the tennis court is rubble, the pavilion was burned down by arsonists and, according to Meador’s attorney John Gay, the main lake is contaminated with raw sewage and is so shallow a boat dock is resting on dry land about 20 feet from the water.

“I suppose if you could get out to (the lake’s water), you could fish on it if you wanted to fish in sewer-infested water,” Gay said.

Financial troubles are at the heart of the demise. The community has changed from owner-occupied to tenant-occupied and an estimated 60 to 65 percent of owners are not paying fees and assessments, leaving a $3 million to $4 million hole in the association’s budget. In addition, a budget shortfall of $450,000 was discovered in 2005, the association borrowed $950,000 in 2008 to repair deteriorating roads, and insurance money for repairing the pool was used for a different purpose.

Fifteen-year resident Meador stopped paying his annual dues and assessments of $375 and asked the trial court abrogate his obligation to pay on the grounds that the association had not maintained the amenities.

Reversing the trial court’s order, the COA agreed with the homeowners association’s claim that the absence of recreational facilities is not such a radical change that would justify the abrogation of a private contractual property covenant.

In court

The courts’ reluctance to rule against homeowners associations comes from its view that the covenant between the association and the property owner is a private contract, said Jon Bomberger, partner at Faegre Baker Daniels LLP. Therefore the courts are hesitant to interfere with these contracts unless the circumstances have drastically changed and defeated the entire purpose of the association.

Instances of a growing commercial development surrounding a subdivision and limiting access or of a hospital expanding to become a medical center and transforming the nature of the neighborhood are examples of radical changes.

Bomberger leads the real estate practice at the firm’s Fort Wayne office, and he has been the president of his homeowners association for 20 years.

Homeowners associations are commonly established when a developer transfers control of a subdivision over to the residents. The primary purpose of these associations is to take care of the common areas, like the parks and streets in the subdivision, and to maintain the property values.

Even without a radical change, tensions can develop. Homeowners associations are about people and their homes, Bomberger said, so disagreements get personal.

Gay has concerns about these associations, seeing a risk they pose to taxpayers. Specifically, the organization collects fees, which Gay described as a “private tax,” but no one is watching how much money is collected or where the money goes. If the association fails, the taxpayers pick up the tab.

Recently, Jennings County agreed to take over the maintenance of the main road in CSL so school buses and emergency vehicles will have access.

“A lot of government money, taxpayer dollars, have gone into trying to fix that place,” he said.

In the CSL case, the court found the property owners were still in a position to benefit from paying dues and assessments since funds could be used to make payments on the $950,000 loan or to make repairs to a dam.

Moreover, Bomberger pointed out, while the court acknowledged the revenue shortfall and the deterioration of recreational amenities, it concluded that removing homeowners’ obligation to pay the association would not remedy the problems. In a footnote, the court offered potential alternatives that Meador and the CSL could investigate including putting the association in receivership or filing for bankruptcy.

Summing up the COA’s ruling, Tanner said, “You don’t get out of paying dues just because you’re not getting the services you think you should be getting.”

A new law

beller Beller

Homeowners can turn to the courts, but until July 2011, the Office of the Indiana Attorney General had no ability to regulate homeowners associations.

Although complaints from property owners kept the office examining the statutes, little could be done because the nonprofit statute does not include homeowners associations, according to Jennie Beller, assistant deputy director of licensing enforcement and homeowner protection unit.

A new state law enacted in mid-2011 gives the attorney general very narrow authority. The state can bring an action against an association’s board or individual board members when there has been an intentional misappropriation of funds or a board member has used his or her position on the board to commit fraud or a criminal act against the association.

“We don’t want to be involved in the things that we can’t fix like (disputes over) the color of curtains or the acts of day-to-day management,” Beller said. “We’re looking for the instances where there’s actual fraud.”

In August, the attorney general filed the first lawsuit under the new law. The case was filed in Clark Circuit Court against The Harbours Condominiums Association in Jeffersonville. The allegations include board members paying a former manager of the association without verifying the time she spent on the job. Also, a board member is accused of not having a building permit when he combined two units into a large one and then, when he re-separated them, constructing a substandard wall that ran through the middle of the shared kitchen sink.

The Harbours is a particularly egregious situation and Beller said other cases would not have to rise to that level. Even one violation is enough to attract the attorney general office’s attention.

Going forward

Tanner believes the COA ruling will greatly help Country Squire Lakes. In particular, other court actions on delinquent homeowners, many for $1,000 or less, have been on hold, waiting for this decision.

“If we could just get people to pay their dues and assessments like they’re supposed to, a lot of those amenities would come back,” Tanner said.

Gay, meanwhile, is drafting an appeal, although he is not sure if he will try to have the case transferred to the Indiana Supreme Court or ask for a rehearing. In his view, the community has failed to maintain property values and failed to provide recreational facilities.

“It is a mess out there,” he said.•
 

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  1. Am I the only one who sees that the City is essentially giving away the MSA site AND giving millions to build new buildings on the site when this site would be the perfect place for the Justice Complex? Across from City-County, check; keeping it centrally located, check, etc. It's my understanding that the GM site must be purchased by the City from Motors Liquidation Company. STOP WASTING WHAT WE ALREADY HAVE AND OUR TAX DOLLARS! The Ballard Administration has not been known for it's common sense...never voted for him and never will!

  2. This guy sounds like the classic molester/manipulator.

  3. Louis D. Brandeis was born in 1856. At 9 years of age it would have been 1865. The Brandeis family did not own slaves. My source Louis D. Brandeis: A Life, by Melvin L. Urofsky.

  4. My name is Matthew Lucas Major, I recently went through a jury trial in Bloomington , In. It was the week of Feb 19-21. Although I have been incarcerated since August 5, 2014. The reason I 'am writing to you sir is on the 21 of February the jury came in with a very excessive and wrongful verdict of guilty on 6 child molesting charges against my daughter who was 9 at the time I was accused. I also had 2 other Felonies one of Intimidation and 1 of Sexual Vicarious Gratification. Judge Marc Kellam on the second day of trial gave me a not guilty on those 2 felonies. The jury was sent out during that time and when brought back Judge Kellam told them to not concern themselves with the 2 Felonies that he ruled on them. They were told to not let evidence they had already heard influence there verdicts. I never in my life touched any child sexually and definitely not with my own daughter. When I was arrested Detective Shawn Karr told me I would be convicted guilty just on my daughters word even without evidence. That's just what happened. my public defender did me so wrong he never once proved to the court and jury all the lies the child told, and Jeremy Noel my public defender could of proven the lies easily. The stories in Serenity's depositions and Forensic interview changed and were not consistent as Prosecutor Darcie Fawcett claimed they were. Yet my attorney never mentioned that. The facts that the child accused me of full penetration in her vagina and rectum was proven lies. Doctor Roberta Hibbard of Riley hospital in Indianapolis confirmed Serenity's hymen intact, no scars, no tearing, no signs of rape to her. Yet my attorney didn't use that knowledge . the DNA was all in my favor. I tell you I will spend my entire life in prison going through rape and beatings etc. even Judge Kellam abused his authority by telling the jurors to listen and believe what the prosecutors side in evidence like my daughters testimony. In one interview with the detectives my daughter got flustered with her mom and said on camera " I'm saying what you told me to mom"!! Yet Mr. Noel said nor did anything to even resemble a defense attorney. Judge Kellam allowed edited version of a taped conversation between the child and her mother. Also Judge Kellam allowed the Prosecutor too bring in to my case a knife found under my seat, the knife wasn't part of my case. She was allowed by my attorney and the judge to put a huge picture of it on the screen and huge picture of my naked privates in a full courtroom and open court. Ms. Fawcett says to jury see how easy Mr. Major could reach the knife and cut his Childs throat. Even though I had no weapons charge against these cases. This gave the jurors prejudice thought against me thinking I threatened her with that knife and how scared she would of been knowing i could get it and kill her. On my sentencing court March 19, 2014 my public defender told Judge Kellam he wish to resign from being my attorney and wished for the court to give me outside council to file a error to trial or appeal. We were denied. Now after openly knowing my public defender don't want to represent me he has to. Well when as parents we make our kids clean a room when they really don't wish to, well the child will but don't mean she will do a good job, that's where I'm at with Mr. Noel. please dont ignore mine and my families pleas for your help . we have all the legal proof you could need to prove Im innocent. Please dont make my spend years in prison innocent when you can fix this wrong. Im not saying Im a perfect man or that I was a perfect dad to my 2 children none of us are. Ive made some bad choices in life and I paid for them. 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The only reason I could think a 9 year old would need so much information is to be prepared to know what to say and be able to say how it felt what took place etc.. So when questioned by authorities she would be prepared. And there again sir if a parent is pre grooming a 9 year old child she would need intimate details . Like telling her daughter about a couple moles on my private area. The child admitted to sneaking my cell and looking many many times at nudes of me and my girlfriend even one where my penis was entering my girlfriends vagina. In that picture my moles are obvious. Yet when prosecutor showed everyone in court my privates and pictures of the moles she said the only way the child would know about them is if she saw them for herself. My attorney once again said nothing about the pictures my child saw. Or could a ex-wife be able to describe my moles to help her case against getting rid of me? I beg you help me. This is my very existence. Ive lost everything , a good job, a wonderful girlfriend, my freedom, but worse thing Ive lost is my children. They were my reason to get up every morning and strive to be better. The wonderful bond I had with my Serenity is gone. After this I would be afraid to even hug her for fear of what next can they do to me. I'm not afraid to tell you I sit here in this cell and try to hold back my tears. Everyone knows you cant show weakness in prison. My life has already been threatened here at Wabash Valley Prison. After only 3 days of arrival. I was tricked into signing a waiver now Im in G Block General Population with 6 child molesting felony charges. Mrs. Hart as a 18 year old I almost died hooked to machines in hospital almost 1 month and now I know that fear was childish compared to this . I cant help but put emotions in this, after all Mrs. Hart Im human and God help Me I never been more afraid in my life. I didnt hurt my little girl I didnt touch her sexually. As much as it shreds me and fills my mind what Im facing I worry more about my mom and granny because of their great love for me mam they are suffering so deeply. I aint done this things but my loved ones suffering right along beside me and If you take my case you will be in essence freeing them also. I sent momma this letter and asked her to email it to you. I'm scared I have been done so unjustly by our legal system and I need you to fix this and give me freedom. I ask you please don't just ignore my pleas. Here in America its nice to be able to trust our legal justice system, well they destroyed my and my loved ones trust in our justice system . And I'm trusting in You !!! My entire family is suffering this nightmare with me. My 77 year old granny had a stroke and isn't doing so well. My single mother that raised 3 kids alone is dying from Lupus and since my arrest has stayed so sick and weary. Our lives torn to peices by a government I was taught I could trust in. my momma has tried so many innocent project and wrongfully accused and cant get anywhere. please please help me. A quote from the late Nelson Mandela: To be free is not merely to cast off ones chains, But to live in a way that respects and enhances The Freedom Of Others. I have Faith in you and your clinic to cast my chains off and give me freedom I do deserve as a wrongfully accused Man, son, brother, father, friend. Matthew Major DOC# 246179 Cause # : 53c02-1308-FA-000779 God Bless you. Please contact me with your decision so I know you made a life changing decision for me , just please at least write me so I know you care enough about your citizens to respond to cries for your help. You can speak openly with my mother Charlotte Spain (828) 476-0406: 71 Lakeview Dr. Canton, NC 28716 Thank You Matthew Major I know yall get thousands of request and inmates claiming innocence, and each person who are innocent deserve to have organizations like yours willing to fight for them and I give yall so much Thanks and I thank God everyday yall are out there caring enough to help free the innocents. Since discovering firsthand how easily lives and families can be destroyed by Poor Defense attorneys not doing their job . And Prosecutors allowed to do as they please in court

  5. Frankly, it is tragic that you are even considering going to an expensive, unaccredited "law school." It is extremely difficult to get a job with a degree from a real school. If you are going to make the investment of time, money, and tears into law school, it should not be to a place that won't actually enable you to practice law when you graduate.

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