HSVillagers Please be Prepared by Karen Daigle Lundberg
Today is June 22nd, and the CCI v. HSVPOA case has been heard. As is very predictable in trials and hearings, the Judge took the case under advisement and stated that he will be making a decision shortly. So here, all of the Villagers are sitting with bated breath waiting on his decision. Sadly, but for no other reasons that the authoritarians running our administration have gone so far, that the majority of property owners (Yes, the MAJORITY) are hoping and wishing and praying for Judge Herzfeld to rule in CCI’s favor. We need this win as much as CCI does to ensure that property owners have complete transparency.
I was not at the hearing, but I have spoken to many people who were at the hearing, and I continue to hear the same stories, in that Judge Herzfeld spoke to the HSVPOA attorneys in a manner that has left everyone believing that he will rule for CCI. Of course, no one but Judge Herzfeld at this time knows how he will rule. However, one thing I have learned during this more than year-long battle with our CEO and old BOD members is that you have to try to stay a step ahead of them at all times.
Preparation is the Key
That is the purpose of me writing this at this time. Preparation is the key. If, indeed, Judge Herzfeld rules in favor of CCI, I believe we all know that the POA will not willingly open their books. They will appeal. If they lose that appeal, they will appeal again. I take you back to the days of the two-tier lawsuit, and how many times it was appealed, and most importantly, how long it took to run through all of the appeals. If Judge Herzfeld rules in favor of CCI, then this is exactly what HSVPOA will do. They will run through all of their appeals processes.
Appeals Process is Expensive
However, what some of you may not know is just how expensive the appeals process is. I do not know if Gene Garner will share this information, but he possibly may share it, if asked, since he was responsible for all of the attorneys’ fees at the end of the day. What I can tell you, though, is when a case moves from the regular Circuit Court into the Appeals Court, another attorney will take over from there, and he will file the Appeal. Appeal attorneys are specialized in appeal litigation because it is much more difficult than trial work. Consequently, appeal attorneys’ charge a great deal more per hour, and use up many, many more hours than just a regular attorney.
Demand Open Records
Fellow Villagers, the problem here is that whatever is in the “books” that the administration is so determined to not let us see, that they are willing to spend an exorbitant amount of property owner funds to keep those books secret. I don’t know about all of you, but that has caused a serious question in my mind from the beginning. People are concerned that the administration is illegally convening the governance committee, which is so true, but in the case of the CCI v HSVPOA case, HSVPOA is willfully and intentionally breaking Arkansas State law by not producing these records, and they know it!! Their excuse is that the statutes are not clear. Well, if there is anything unclear, it is most definitely our Bylaws. Our Bylaws are so convoluted, they need to be completely rewritten. They have been added to and deleted so many times that they contradict each other in different sections on different pages, and they are such a convoluted mess that no one can interpret them. On the other hand, the Arkansas statutes are very clear in this case, and if Judge Herzfeld does, in fact, rule for CCI, we need to pull out all of the stops to keep HSVPOA from filing an appeal. We DO NOT need to pay hundreds of thousands of dollars in attorneys’ fees (and that is what it will be), nor let the HSVPOA stall another two years from opening their books. It is the law that they open those records to CCI and to us, and we need to be prepared to demand that and to demand that they not file an appeal.
Stop the Attorneys’ Fees Now
Ask yourself this question: WHAT ARE THEY SO INTENT ON HIDING???
Remember the November vote. Together we can stop this!! Let’s be prepared to do it. We have three good Board members on our side now. Let us all support them and rally together to stop attorneys’ fees NOW!!
Written by Karen Daigle Lundberg, June 22, 2019
Editors Note:
Taken from the Hot Springs Village POA Policy Guide:
ARTICLE 18
INSURANCE CLAIMS AND LITIGATION POLICY
SECTION 2: LITIGATION
2. Enforcement of Declaration and Governance Policies – Any legal action required to pursue the enforcement of the protective covenants, Bylaws, and policies of the POA must receive the prior approval of the Board of Directors. Enforcement of Operational Policies shall be administered by the CEO.
Edited and Formatted by Cheryl Dowden
Vicky Didion
06/22/2019 — 10:10 am
So we’ll written and I believe so true about the appeals.
Yes, what is so important that they are hiding???
Why is CEO so adamant about not revealing this information to property owners? What is CEO afraid of? Why would CEO spend so much of our assessment money just to keep the books closed?
John Dethardt
06/22/2019 — 10:43 am
The board need to step in and stop the needless spending for legal fees. Enough is enough. If some people think the management should appeal start a go fund me page to pay for the legal. My guess is not a lot money would be collected. But it’s not their money. What are we hiding.
Tom Blakeman
06/22/2019 — 12:45 pm
Don’t be fooled: The “word on the street” which was promulgated by POA and their supporters is that the Garner lawsuit and appeals, etc. didn’t cost us much because POA carries Directors and Officers (D & O) insurance. That same story is now being put forth by POA with regard to the CCI suit.
Anything is of course possible but I believe this “word on the street” is totally bogus. Even if it were even partially true that means that our insurance rates would be (and have been) sky rocketing. Of course we have no clue how much POA is spending upon legal fees and lawyers because they don want us to know.
Either way you slice it these lawsuits are costing us property owners big money. And for no sensible or valid reason.
Message to POA: Settle ALL the lawsuits now!
Lloyd Sherman
06/22/2019 — 12:50 pm
Keep in mind that we most likely have D & O insurance in place and most policies have coverage for lawsuits filed. They will have a deductible, and then as long as nothing is fraudulent in the pursuit and settlement of the lawsuit(s), the amounts above the deductible are paid through the insurance. However, with the volume of lawsuits we are now involved in and the threat of more, will the D & O policy be renewed? If renewed will the premium be so exorbitant that we can’t afford it? Or will we be uninsurable because of our experience rating? Doesn’t really matter as whatever the answer is, it is coming from our assessments.
Have been previously covered by D & O insurance but maybe somebody who has been in that industry can enlighten us if there are any more considerations we should be aware of.
BTW – If this matter of the Governance Committee winds up in a lawsuit or tagged onto an existing lawsuit, what are the implications on those who have knowingly participated in illegal activity? Don’t know the answer to that but if I were a board member, you can bet I would be finding out. If the CCI lawsuit is appealed I could foresee this issue being tagged onto that lawsuit.
Kirk Denger
06/24/2019 — 2:10 am
Tom and Lloyd, If the Directors and Officers Insurance company provided the lame defense that we have seen so far, The Board might think seriously of looking for another insurance company.
Vicki Husted
06/27/2019 — 11:29 am
Lloyd, Makes a lot of sense about the D&O coverage, rate increases, uninsurability because of volume, ect.
I, too, would like to hear about any other considerations that might apply, and would particularly be interested in whether or not failure to include and pursue performance bonds in contracts prior to filing an expensive lawsuit might even trigger immediate cancellation!
Agree with your last paragraph, too. Another issue I’m curious about is whether or not a not-for-profit can legally lend our monies to anyone, and what sort of legal remedy would be applied if it is illegal.
I also want to harken back to Karen’s warning here… “However, one thing I have learned during this more than year-long battle with our CEO and old BOD members is that you have to try to stay a step ahead of them at all times.”
…AT ALL TIMES!
HSVP J
06/22/2019 — 12:54 pm
It is a shame that property owners are forced to take legal action against their Association in order to obtain total transparency of our HSVPOA financial condition.
Anonymous
06/22/2019 — 1:50 pm
How can we demand they open the books and demand they not file an appeal, and expect that they will comply. I’m all in but they haven’t complied with anything yet.
Maureen Heenan
06/22/2019 — 3:03 pm
I think we need expert advice on how to proceed. There must be lawyers living in the Village that can tell us how to stop the appeal.
Karen D Lundberg
06/22/2019 — 8:06 pm
Anonymous, you are absolutely correct, and I have gotten upset and thrown in the towel so many times because what you say is right. When Cindi Erickson flat refused to issue fair sanctions across the board, I was very angry and was ready to just quit. But in the case of this lawsuit, if HSVPOA opens the records, and we find what many of us suspect we will find, then a lawsuit or an attorney would not be necessary to enforce the consequences. I am not making any accusations whatsoever. What I am saying, though, is they have certainly fought hard to keep all of us from seeing inside the records. WHY????
Minnie. Daly
06/27/2019 — 11:05 am
Thank you for your intelligent view on Lawsuit! COOPER as well asPOA owners deserve answers on salaries An contracts issued by Nalley And the board! COOPER is the developer, he controls the easements plus there are 2 county roads within this community. We all deserve answers & seek to understand why the secrecy in all that Board & Nalley perform. Thank you, Minn