How did a $150 fine against an owner by an HOA trying to enforce its rules on dogs escalate into tens of thousands of dollars of legal fees?
Because that is what HOA attorneys do. Not just in Hawaii, where this case occurred, but in Colorado, where predatory attorneys like those we saw in notably in Green Valley Ranch or The Timbers take petty issues and make them into monumental financial travesties of justice. And, most often, they get away with it.
A few people in Poudre Overlook have stated to me that they don’t take the issues of HB22-1137 seriously because they “only happened in that one HOA”. Not true. The investigative journalists at Fox31 and PBS, independently working on the same topics, found that the issue occurs throughout Colorado – because there is a cabal of attorneys who find the practice of using financial escalations and threats to be the only tool in the compliance toolbox. One attorney who was subjected to this behavior himself, and ultimately brought the issues of HB22-1137 to the Colorado Legislature described this as using a nuclear weapon on a mosquito.
And, this story from Hawaii fits that description. In a case of callous HOA Directors who thought an absolute ban on dogs was more important than someone who benefitted from a service dog that was previously allowed, turned a disputed $150 fine over to attorneys who then racked up $14k in legal fees, which then quickly escalated into $49k in fees.
“Porter McGuire Kiakona now faces $475,000 in damages for violating debt collection laws in a case that started with a $150 fine against a dog owner.”
It backfired. In the end, not only did the owner get awarded $50k for having his privacy violated, but there was $400k in punitive damages.
As Poudre Overlook recently used VF-Law’s Lisa Cancanon, who is one of the notable attorneys involved in Green Valley Ranch, to try to rewrite its governing documents, the fact that Ms. Cancanon has now left VF-Law as the controversy made the news, and literally abandoned her lucrative career in setting up HOAs to be these cash cows, particular focus needs to be placed on whether hiring attorneys means setting up homeowners for such predatory treatment.
In the draft documents from VF-Law, which the POHOA Board desperately tried to keep secret from homeowners as the Document Revision Committee saw zero problem with them, had elements that not only made it easier for such attorneys to rack up outrageous fees, but they also took away protections – including the right to seek bankruptcy protection from such financial predators. These are the types of clauses used by Loan Sharks for decades, and they have no such place in covenants for HOAs.
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Open in new tab When asked if the Board was seeking to add such elements to our governing documents, the Board cried “harassment” for being asked, and they all quit. If they could not see this coming and protect us, it’s perhaps less bad then seeking it out in the first place. But, we need Board leadership that protects us from predators rather than leading them to our doorsteps.