Disrupting The HOA Industry—Part II: Why is it “Us vs. Them?”
In Part I of this series, I defined the homeowner association “Us versus Them” syndrome. In this post, I discuss how the pervasive attitude developed. The “Us versus Them” judgment can be traced to the origins of the HOAs themselves—the governing documents. Most HOAs are created through drafting and recording of declarations or CC&Rs (Covenants, Conditions & Restrictions), Bylaws, and Rules (among other formation documents).
Who drafts the documents? Attorneys. Who pays the attorneys? HOA developers who create the communities. Who are the attorneys’ clients: the developers, the HOAs, or the future homeowners? The developers. Hence, attorneys do not have a fiduciary duty to future homeowners. Not that they intentionally try to muck up matters for the future owners, but their loyalty is to their client—the developer.
As a result of HOA documents being prepared by attorneys who work for developers, many aspects of the documents do not anticipate how the community will be governed and managed years down the line. [Note: This is not a hatchet job against HOA attorneys; I was one for many years! Numerous HOA attorneys produce quality governing documents that stand the test of time.] Furthermore, the attorneys rely on their education and training—both focused on keystone legal principles. Attorneys are not trained in law school on internal organizational conflict resolution methodologies. At best, attorneys learn Alternative Dispute Resolution methods such as mediation and arbitration which still pose one party against the other as an adversary.
From the first day of its existence, an HOA relies upon its governing documents, written in an “Us versus Them” manner, to conduct dispute resolution. When a potential or actual conflict arises within an HOA—whether the dispute is intra-board or involves a homeowner—the board and manager are forced by their own documents, rules, and guidelines to treat the conflict in an adversarial manner pitting the HOA against the homeowner, and vice versa.
There are a few states in the US that have attempted to legislate internal conflict resolution for HOAs, such as California’s Internal Dispute Resolution statute. At best, these laws only touch the surface and focus on resolution well after the parties have formulated adversarial positions. I have not seen a law that addresses a system for framing and identifying a dispute in a more inclusive, organizational context.
In Part Three of “Disrupting The HOA Industry: How to Shatter the ‘Us vs. Them’ Mentality,” I provide an outline for breaking out of the adversarial HOA dispute resolution process, leading to substantial savings of time and money, and increasing harmony within your community.