Undermining an HOA's General Legal Counsel's Credibility Means Looking at Two Aspects of any HOA Lawyers Career: 1) Day to Day HOA Lawyer Activities and more importantly, 2) Litigation Support Credibility

June 03, 2005

By Zelda Goldberg
Copyright AHRC News Services

It has been reported that a leading national insurance carrier which is going out of the Homeowner Association insurance market in California has recently revealed a little known secret to all HOA residents.

Kemper Insurance Company has disclosed that in those instances wherein Kemper finds itself exposed to litigation, Kemper fails or refuses to go after negligent or willfully misdirected HOA attorneys (General Legal Counsel), even in instances wherein the HOA attorneys conduct is highly questionable, because Kemper has advised that it might need these same HOA attorneys down the road as "expert" witness on other HOA -related legal matters.

Let's look at the following hypothetical situation for example:

The Board of Directors of the Filthy Breezes HOA is crooked, so much so that none one of the five Directors and Officers of the HOA can lay straight in bed at night, and have been sued by an HOA member who's had his last dollar squandered.

The Board's lawyer, Penny Stealer, is a bellicose and dour woman in her early 40's who clearly appears a great deal older and tired (worn out) than her years might otherwise indicate, has never been married and spends her waking hours hounding and chasing "delinquent" homeowners.

Penny Stealer knows that the Board members have embezzled thousands of dollars of HOA Trust Funds, and that the Board members have hidden this criminal mischief from the HOA members, but keep raising monthly dues to cover up the stealing.

The Board's manager, Sleeze E. Wonder, an uneducated fast talking, overweight and desperate appearing down on his luck man in his 50's with a criminal record, appears to drink heavily and has no known residential address and works out of a cluttered office which appears to be cheaply and sparsely furnished offices in a low rent business park, which has the appearance of being easily moved out of under cover of darkness, has embezzled approximately $30,000. in HOA Trust Funds from the Association's Bank Account.

Penny Stealer, the Board's lawyer, knows that the manager has embezzled the funds from the bank, which is bank fraud - a felony- , but because she and the manager belong to certain HOA vendor trade groups, she refuses to report this suspected criminal conduct although she is required to do so as an attorney (sworn officer of the court).

The insurance company comes in to defend the Board members, as well as the manager (who is getting free insurance from the Board and likely could neither qualify for, nor be able to afford his own insurance) under the HOA's insurance policy which is paid for by the HOA members.

When asked about the situation, the insurance company - and in this hypothetical situation, Kemper Insurance Company - explains that although what the HOA Board's lawyer is doing is crooked and illegal (covering up a felony), the insurance company may need to use the Board's lawyer (Penny Mangler) down the road to help the insurance company defend against other law suits in other developments which Kemper insurance has policies on.

Based on the above hypothetical situation, what needs to happen is that the Board's lawyer needs to be reported for their misconduct, and a list developed to expose this legal mischief in order to prevent the Board's lawyer from engaging in misconduct, and then down the road, being permitted to be called as an "expert" witness for any other insurance companies.

So, what needs to happen is that all HOA lawyers (General Legal Counsel) who engage in such types of conduct, should be put onto a registration list, which then should be cross referenced by both HOA's seeking to hire General Legal Counsel, as well as any insurance companies seeking to hire so called "expert" witnesses.

If we can get these HOA lawyers out of the front (General Legal Counsel) part of the HOA arena, and prevent them from practicing their craft on the back ("expert" witness Legal Counsel) part of the HOA arena, we can simultaneously clean out the stables, and at the same time keep our insurance rates down.

We will also keep down the white collar crime rates in our own HOA's.