Guard from a lawsuit against your HOA

This article is by Michele Lerner • Bankrate.com

Your homeowners association, or HOA, could be sued because of its crime watch program. There are steps you can take to protect your HOA and your own pocketbook from a lawsuit.

Regardless of the outcome of criminal charges filed against George Zimmerman for the killing of Trayvon Martin in Sanford, Fla., the HOA where the shooting occurred could be subject to a civil lawsuit. Lawsuits can drain the financial resources of associations and can even require special assessments to pay for legal expenses. In this way, homeowners can be held responsible for the actions of their neighbors.

If you live in a community with a homeowners association, legal experts recommend that you review the Neighborhood Watch program rules and check on the HOA's liability insurance coverage.
News reports on the Zimmerman case have said that he was designated by his HOA as a "captain" of the community's neighborhood watch program.

"It is quite unusual to have a resident listed as a security contact," says Allen Warren, an attorney with Chadwick, Washington, Moriarty, Elmore & Bunn in Fairfax, Va. "It's more common to rely on local law enforcement for security. HOAs should never give the impression they are providing security for residents." Warren says it is best if a neighborhood watch or crime watch program is coordinated with the local police department and is not a designated HOA committee.

"When a community wants to set up a volunteer crime watch system, I encourage it, but I highly recommend that they have a community liaison officer from the local police or sheriff's office come in to train the volunteers," says Ellen Hirsch de Haan, a partner and attorney with Becker & Poliakoff in Clearwater, Fla., and past president of the Community Associations Institute. "The crime watch group must have written instructions, the first of which should be to call 911 and to not intervene in any situation."

Hirsch de Haan says that written guidelines must be distributed to all volunteers and to the community at large. The rules should prohibit carrying a weapon while on neighborhood watch duty.
"If the volunteer overstepped the guidelines, the HOA is in much better shape legally if the guidelines are in written form," Hirsch de Haan says.

Warren says: "Volunteers should be told their only role should be to observe and report. They should be told not to engage in any action other than calling 911 and reporting what they have seen to the local police." If an HOA's officers want security beyond resident observation and local law enforcement, Warren suggests hiring a professional security firm because a contract would offer greater liability protection for the HOA.

Insurance protection

Every HOA should have appropriate liability insurance coverage, experts say."HOAs generally carry commercial liability insurance coverage that protects the HOA's liability," Warren says. "That insurance policy may or may not also cover the board of directors and volunteers on an HOA committee. Residents should ask their HOA if they are covered under the HOA's liability policy when they are volunteering for the association."

Most insurance policies exclude criminal activity from liability protection, Warren says. If an HOA volunteer is convicted of a crime, the liability insurance will not cover any costs.

 Individuals should have their own liability insurance that covers them when something happens on their own property or when they are acting on their own.If the HOA in Zimmerman's neighborhood is successfully sued, the impact on homeowners depends on the size of the award and the details of the HOA's insurance policy. "If an award is larger than the insurance coverage, then the HOA could impose a special assessment on all the homeowners to pay for the lawsuit," Hirsch de Haan says.

As long as HOAs are clear in their directions for volunteers, defer to local law enforcement and have adequate insurance coverage, Hirsch de Haan says crime watch committees can have a positive impact on a community.

What is the Alternative to Joint Managing Conservatorship (JMCs) in Texas?

In Texas, when parents are not appointed as “joint managing conservators” or “JMCs” for their children, one parent is appointed as the “sole managing conservatory” or “SMC” – this is the parent who receives the exclusive rights to make decisions about medical care, mental health care, and educational decisions, as well as the exclusive right to determine the child’s primary residence.  See Tex. Family Code § 153.132.

The other parent is appointed as “possessory conservator” or “PC”.  This parent has a much more limited ability to make decisions about the child’s welfare and upbringing.  See Tex. Family Code § 153.192.

However, even in situations where one parent is an “SMC,” and the other parent is a “PC,” the court will enter a standard possession order under which each parent has very similar periods of possession/custodial time, unless the courts finds a compelling reason to limit the PC’s periods of possession in the child’s best interest.  Texas’ public policy (as enacted in our statutes) encourages frequent contact between a child and each parent in order to permit the child to develop a close and continuing relationship with that parent.  See Tex. Family Code § 153.251(b).

Article by Cynthia W. Veidt, Attorney

Texas Employment Law Basics for Employers

Let's say you’ve started a business in Austin and it has now grown to the point where you need to employ someone other than yourself or your immediate family.  Congratulations!

But now you have to think like an “employer.”  That means you need to familiarize yourself with at least some basic employment law and human resource management principles.  In this blog, we’ll periodically post topics that can help guide you, but here are a few initial considerations:

Hiring – Employees or Independent Contractors?

Salary – Who is Eligible for Overtime Pay?

Job Applications – What Can I Ask, and What Should I Avoid?

Avoiding Illegal Workers

General Recordkeeping Requirements

Employee Discipline

Firing / Terminating Employees – Creating a Paper Trail

Avoiding a Discrimination Claim

Avoiding a Retaliation Claim

How to Handle an Unemployment Claim

Most employers have a pretty good handle on the day to day operation of their business once armed with basic information.  When in doubt, if something feels “wrong” on a gut level, it’s always a good idea to check with someone well-versed in employment law before taking any action which you may later regret.

By: Cynthia W. Veidt

ADA and the Online World

Excellent post on our friend Ryan Garcia's Social Media Law Blog (SoMeLaw Thoughts ) about the intersection of the Americans with Disabilities Act and online commercial websites.  In particular, there is a lawsuit by an organization (National Association of the Deaf) wanting the court to order Netflix to offer closed captioning for movies on their streaming site.  Excellent history of the regulations related to closed captioning is provided, and it is worth the read.  It is written by Curtis Edmonds, an attorney and writer from New Jersey well versed on the topic.

Fourth Court Upholds Allegedly Obsolete Restrictions Mandating Residential Use Along Blanco Road

ALTHOUGH RESIDENTIAL-ONLY RESTRICTIONS MAY BE NULLIFIED, COURTS ARE RELUCTANT TO DO SO

On July 13, 2012, the Fourth Court of Appeals of Texas (San Antonio) issued its opinion in a case in which it was asked to determine whether antiquated residential-use limitations applied to a subdivision abutting now heavily-developed and largely-commercial Blanco Road in San Antonio. 

In upholding the restrictive covenants as requested by the Canyon Creek Estates Homeowners Association, the San Antonio Court court analyzed Texas precedent allowing a court to nullify or void a restrictive covenant limiting property use to residential only. Such nullification may occur when the party seeking modify the restriction proves either that the property owners have acquiesced in violations of the residential restriction so as to amount to an abandonment of the covenant or a waiver of the right to enforce it; OR that there has been “such a change of conditions in the restricted area or surrounding it that it is no longer possible to secure in a substantial degree the benefits sought to be realized through the covenant.” See Cowling v. Colligan, 158 Tex. 458, 312 S.W.2d 943, 945 (1958). The Court noted that voiding a residential restriction based on changed circumstances or conditions, will only occur when the changed conditions are “radical.” 

“Radical” change is evidenced utilizing the following factors: (1) the size of the restricted area; (2) the location of the restricted area with respect to where the change has occurred; (3) the type of change or changes that have occurred; (4) the character and conduct of the parties or their predecessors in title; (5) the purpose of the restrictions; and (6) to some extent, the unexpired term of the restrictions. Id. 

In reaching its determination that the Canyon Creek Estates subdivision didn't meet the criteria for nullification of the residential-only restriction, the Court pointed out that Texas law states increased commercial growth and increases in traffic and congestion in streets bounding a restricted subdivision are alone insufficient to warrant nullification of the residential restriction. See Hemphill v. Cayce, 197 S.W.2d 137, 141 (Tex. Civ. App.—Fort Worth 1946, no writ). 

The Fourth Court's full opinion can be found HERE.

Austin Residents, Police Question HOA Spending of Assessments

Residents question HOA accountability: kxan.com

Denver HOA Bans Children's Chalk Art

Hearts and stars aren't exactly graffiti in my neighborhood, but then again, with a name like "Innovations and Courtyard Traditions," I guess the sensibilities in Stapleton are more delicate than those of us south Texans.  Here's a story of a homeowners association with far too little to do.


http://www.myfoxny.com/story/18847568/denver-neighborhood-bans-children-from-drawing-chalk-art-on-sidewalk

Fisticuffs in Colorado -- HOA President threatens reporter, neighbors, then resigns

Most crazy HOA stories come out of Florida, where the sheer quantity of condos breed HOAs.  But even laid-back Colorado can get a little crazy sometimes!

From KKCO -- Grand Junction Colorado's NBC Affiliate. Read the bizarre story here: HOA pres. threatens reporter, neighbors, then resigns

Austin Homeowners Fight Back Against HOA Board

From KXAN -- NBC Affiliate in Austin, Texas:  An escalating fight between homeowners at the Sunchase Condominiums in North Austin and their homeowners association has turned into a move to oust the HOA board members -- and a civil lawsuit involving the HOA, its Board members and its management company.

Homeowners fight back against HOA board: kxan.com

">

Katy Man Sentenced to 35 years for stealing $1m from Texas HOAs

A Katy man faces 35 years in prison after he pled guilty to stealing more than $1 million from Katy-area homeowners associations.


A judge sentenced Taggert Michael Mayfield on June 8 after he pled guilty to misapplication of fiduciary property, money laundering and theft, according to a news release issued by Assistant District Attorney Rodolfo Ramirez.


Ramirez says Mayfield used his company, Arrow Management, to steal the money between 2007-2011 from a dozen different Katy-area associations. His company managed the pilfered home associations.
Mayfield then allegedly covered up the thefts by falsifying reports he made to his clients. The investigation into Mayfield's misdeeds began after one association questioned these alleged falsified reports and raised concerns with the Fort Bend County Sheriff's Office, the prosecutor reported.


He used the alleged stolen money to pay for his half-million-dollar home and vacations, according to the release.


"The defendant appeared successful -- living the dream," said Ramirez in the press release. "But he really pilfered from hard-working people while he appeared to do an honest day's labor."


By: Glenna Herald, Ultimate Fort Bend


Click here for related coverage of the story from the Katy Times.

14 Plead Guilty in FBI Investigation of Vegas HOAs

WASHINGTON—Fourteen individuals pleaded guilty yesterday in the District of Nevada for their roles in the scheme to fraudulently take control of various home owners’ associations (HOAs) in the Las Vegas area.


According to plea documents, the defendants each pleaded guilty to one count of conspiracy to commit mail and wire fraud, and the fraud scheme operated from approximately August 2003 through February 2009 with various co-conspirators joining that scheme at different times. The conspirators operated the scheme to direct construction defect litigation and repairs at condominium complexes to a particular law firm and construction company.


In order to accomplish the scheme, certain co-conspirators identified HOAs that could potentially bring construction defect cases. Once identified, the co-conspirators enlisted real estate agents to identify condominium units within the HOA communities for purchase. The co-conspirators then enlisted individuals as straw purchasers to use their names and credit to purchase condominiums in the complexes. The defendants admitted that the co-conspirators provided the down payments and monthly payments to the straw purchasers, including HOA dues and mortgage payments, and that various false and misleading statements were made to secure financing for the properties. Certain co-conspirators operated and managed the payments associated with these properties. The payments were often wired between California and Nevada.


Ten other individuals pleaded guilty in 2011 as part of the government’s ongoing criminal investigation of activities related to various Las Vegas HOAs.


Read the FBI's Press Release at this link:  http://www.fbi.gov/lasvegas/press-releases/2012/fourteen-individuals-plead-guilty-for-their-roles-in-scheme-to-fraudulently-control-home-owners-associations-in-las-vegas

Homeowners say they've been shut out of Developer-controlled association despite new state law

KELLER, Texas -- The Hidden Lakes Homeowners Association "fired" most of its volunteers without warning and is barring residents from board meetings after the developer began taking an active role on the board, some residents say.

Those residents also complain that the developer is using HOA money to pay for landscaping services from a developer-owned company instead of seeking bids and that it is using association money to make repairs that are the developer's responsibility.

And that may all be legal despite a new state law reining in homeowners associations. Read the full Ft. Worth Star Telegram story below:

Keller homeowners say they've been shut out of association despite new state law | Arlingt...

Locating Lease Space for your Business in Texas: Things to Consider when searching for Commercial Lease Space

When searching for commercial lease space there many things to take into consideration such as, just to name a few, expenses, the lease term, parking and permitted uses and restrictions.

The total monthly cost of the lease is usually the primary concern for tenants and is determined by the type of lease you agree to.  There are two main types of leases – gross leases and triple net leases. Under a gross lease the tenant pays a set amount specified in the lease agreement while the landlord pays for all of the operating costs.  Under a triple net lease the tenant pays the set amount specified in the lease agreement plus its pro rata share of the operating expenses, which may include repair costs, insurance premiums, taxes, and utilities.  It is important for the tenant to determine up front what the anticipated expenses will be and understand that expenses could increase for various reasons such as maintenance issues or increases in taxes or utility rates.  There are also ‘hybrid’ leases that combine elements of the gross and triple net lease.

Many commercial leases will contain a personal guaranty, which means that the individuals signing the lease are also agreeing to be personally liable for all amounts due under the lease agreement.  Even though your business entity is the tenant, you will be personally responsible for the rent as well.  Some landlords may negotiate with prospective tenants if they can show a good rental history or are willing to put up collateral.

Most commercial lease space will need to be altered in some way to meet your needs, or in other words, the space will need to be “finished-out.”  The cost of finish-out may be paid by the landlord, may be the tenant’s sole responsibility, or the landlord may provide the tenant with a budget, and any extras will be charged to the tenant.  It is also important to determine whether the landlord requires that you use certain contractors for finish-out.

Other concerns will depend on the type of business you intend to operate.  Prospective tenants need to ensure there are no restrictions against operating their type of business, and they may want to ask the landlord for a restriction against other businesses similar to yours in the future to prevent competition from moving in next door.  You may need reserved parking or a sign; prospective tenants should determine in advance what they will need to operate their business and ensure the landlord will address these issues.

While commercial leases can be long and confusing, it is important to read and fully understand the lease agreement to ensure the space will meet your business needs and to prevent problems for years to come.

Prepared by Eric Rupe.  Edited by Sarah Berry, Attorney

Texas Primary Custody: What Does That Really Mean?

In Texas, courts typically appoint both parents as “joint managing conservators” or “JMCs” for their children.  What does this really mean though?

“Conservatorship” simply means the parent’s right to make certain decisions for the child, including decisions about medical care, mental health care, and educational decisions.  The presumption is that both parents should share these rights so that each has a say in important decisions concerning their child, in the absence of an emergency or other factors (which will be a topic of future blog entries here).  See Tex. Family Code § 153.131.

So, if the parents are joint managing conservators, how do we determine which parent has “primary custody?” 

Although that term is used by many parents to describe their status, it is not an actual legal term recognized in Texas.  The closest standard for determining which parent is “primary” relates to the court’s decision (or the parties’ agreement) to grant one parent the exclusive right to designate the child’s “primary residence.”  That parent is also generally the parent who has the exclusive right to receive child support. 

So, in Texas, the term “primary custody” is somewhat misleading.  Parents who are appointed as JMCs are usually under a Standard Possession Order or “SPO” where the child spends only a little more time with one parent than the other, once all the days and hours are added up.  It is even common for parents to agree to a possession order in which the children reside an equal amount of time with each parent.  In these circumstances, neither has “primary custody,” but one parent will still have the exclusive right to determine the child’s primary residence. 

Article by Austin Lawyer Cynthia W. Veidt 

No Refusal on Fourth of July 2012: Pulled Over in Dallas or Fort Worth for DWI Does Not Mean You Have No Defense: You May Have to Fight for Your Rights

It's the Fourth of July and that means law enforcement is working today, working hard to pull over and arrest people for suspicion of driving while intoxicated or distracted driving.  So be careful today, if you're out on the roads. 

In fact, in the Dallas - Fort Worth area, the "No Refusal" campaigns are in place at the Dallas Police Department along with Arlington Police Department, Irving Police Department, and other municipalities as well as the State of Texas Department of Transportation and the counties themselves (Dallas, Tarrant). 

What is a "No Refusal" Campaign?

The No Refusal Campaign is the brainchild of the federal government via its National Highway Traffic Safety Administration.  It's when the Powers that Be have a judge setting at a desk, on stand-by, to immediately sign a warrant that will approve the taking of your breath in a breathalyzer test or your blood with a needle even if you have exercised your constitutional rights and initially declined testing of blood, breath, or any other human body part.  

If the Breathalyzer reports a blood alcohol level of .08 or more, then it's most likely that you will arrested on the spot.

Tarrant County Goes One More With Its New Website Campaign

Over in Fort Worth, citizens face even more challenges to their rights.  It seems that the Tarrant County District Attorney, Joe Shannon, has announced that his office will publish online the full names and the ages of everyone arrested and charged with DWI on its website,  www.tarrantda.com. 

Things To Know About No Refusal DWI Campaigns: Fight for Your Individual Rights

Many challenge these No Refusal campaigns as well as the publication of names of citizens who have been arrested as being in violation of their legal rights under the constitution and both state and federal law.  The Tarrant County publication list is another, separate constitutional argument involving civil rights. 

Additionally, there are several things to remember about these law enforcment sweeps over holidays, including:

• searches and seizures of the vehicles must follow state law as always, this doesn't change the protections given to people from police searching their cars (read our article on searches and seizures here for details); 
• it's not illegal to drive below the speed limit, just not over it (read our 10 Things To Know When the Police Pull You Over for more details); 
• it's important to act fast if you are arrested for DWI, because not only will the police take your driver's license but you have only 15 days before the ALR Hearing (read here on details about the ALR Hearing and how important it is).  

Finally, you can call your lawyer when you are arrested in a No Refusal campaign, and it's a good idea to have legal representation on board as soon as possible in these kinds of Drunk Driving cases. You will have legal defenses to assert, and you will have big risks in front of you: loss of license, fines, jail time, impact on your public record, and more.  

It's not over till it's over and a No Refusal DWI arrest in Texas does not mean that you have no criminal defense.  Lawyers experienced in drunk driving defense cases in Dallas, Fort Worth, and other parts of Texas are ready to help you protect your future.