Royden’s Trojan Horse-Power Grab
Dear Royden neighbors, unfortunately I HAD TO ATTEND a United Methodist Church meeting last night and I missed the “town hall” meeting, hastily and clumsily called by Mr. Ron Arrington, the Royden President. This BOM BAM thank you MAM is a very profound change!
Here is yet another, in the ever growing list, of violations of the By-Laws by this Board of Directors (BOD)…… Notice of Meetings-Section 3-requires a minimum of “10 day notice” for any General Meeting of members. Less than 3 days’ notice was allowed. Thus, apparently the use of the term…Town Hall…or for lack of another term….a bull session. No official business can be conducted at anything other than a General Meeting….Whatever occurred on the evening of February 27, 2019, was a total waste of time.
Now for the very important issue at hand- Royden Board’s Trojan Horse-Electoral College Power Grab…here is what you need to know to be able to submit your vote or proxy at some date uncertain time, another violation…..I am numbering the issues so that they can be referenced in future conversations: Some History first
1. A NC GS 55A Community-Royden is a NC GS 55A nonprofit Corporation, established in 1987, with three (3) separate subdivisions and Covenants, Controls and Restrictions (CCR’S). Phase I/II, III and IV. Phase I/II was the first lots developed, then III and the final I/V to the other side of Carmel Road. For several years, the Phase I/II Royden HOA operated on an informal basis with the III, IV residents and billed them annual assessments, even though the subdivisions had not been merged. Our form of HOA is the simplest and “softest touch” form of HOA in the country. I am an anti-HOA activist and Blogger (associationbusters.com). You probably have seen my Counterpoint Newsletters. Royden Homeowners have ALL THE POWER in the HOA. The Royden Board can only impact the community with their proficiency in maintaining the Common areas, and now with a full built out community, a limited Architectural approval role. Local civil authorities control garbage cans, barking dogs, noisy neighbors, lot maintenance etc. The Royden Board is a toothless tiger…..Front entrance design, Legal and Social activities require special assessment approval from all three subdivisions. When I was President, every lot has easement, plot line, design and construction issues; Current Architectural control, if there even is a committee, is relegated to paint colors, door colors and swimming pool fencing…Tough stuff….OH!!! Who approved Colored Brick????????
2. CCR Consolidation-The three Subdivisions were consolidated in 1994. It was not until 2004 that the bulky and cumbersome documents were Consolidated (by myself) (attached) and reduced to 34 pages, with the plan for further consolidation to ten pages. As president, I presented, the Consolidation for Special Assessment approval of the $1000.00 legal fees, required to confirm the structural legalese identifying the property records on file. At the time, the Board was looking to get special assessment funding for the re-painting of the front entrances and did not want to have two special assessments to be approved…My term ended…..the consolidation document was not presented and the easement lawsuit began. AND WE ALL KNOW HOW THAT TURNED OUT $300,000.00 of legal fees later (Horack Talley was the Royden attorney)!!! Note, consolidation is not an amendment and a simple motion with a BOD resolution and a vote by the majority of all members is needed. SIMPLE IS AS SIMPLE DOES!
3. First NC GS 47F Planned Community Proposal Fails-A state of anarchy prevailed during 2004 -2012 after the very divisive easement lawsuit period. In 2012, during the BOD’s initial attempt to impose a NC Planned Community GS 47F revised covenant initiative on the neighborhood…(it failed by 5 votes in Phase I/II), I noted a blatant cash shortfall of an estimated $4,000.00 was present in the Royden Financials,,,,I confronted the RHA BOD and was met with personal attacks by the Board and their lawyer Michal Hunter, to no avail
4. Rinaldi Files Article IV Lawsuits-In 2012, I began a series of lawsuits against Royden. My work in the 2003-2004 Consolidation effort (personal cost of $676.00) I saw that the Phase I/II Annual Assessment Ballot voting method, that the Founding President and I had used in circa 1987 (I was Vice president one year, President for 5 years and Treasurer 1 year) was replaced with the approval of the merger agreement and that the Phase III-IV Article IV-Covenant for Maintenance Assessments controlled ALL THREE SUBDIVIONS. The linkage was confirmed with the ADDITIONAL PROPERTY provision in Phase I/II. For emphasis: ARTICLE IV-COVENANT FOR MAINTENANCE ASSESSMENT IN PHASE III AND IV SUBDIVISION COVENANTS, SINCE 1994 TO THE PRESENT, CONTROLS ALL 3 SUBDIVISION ANNUAL ASSESSMENT FIXING AND ADMINISTRATION INCLUDING I/II
5. Rinaldi Lawsuits Dismissed, Sanction action by RHA-After 3 years, over 300 hours, $10,000.00 in legal costs, my legal claim was that: The Royden HOA and their attorney, Horack Talley, had committed CONSTRUCTIVE FRAUD-BREACH OF FIDUCIARY DUTY and had violated Article IV-Covenant for Maintenance for over 10 years in the fixing of the Annual Assessments. After 3 years, the case was DISMISSED…as a “pro se” plaintiff, I had violated the RULES OF CIVIL PROCEDURE -12 (B) (6) and “failure to state a claim for which a remedy can be placed”. The RHA BOD and the D&O attorneys, filed a sanctioned against me, without prior communication to the membership, as called for in the by –laws and I was fined $6,330.00 and labelled a “vexatious litigant”
6. Royden BOD Trojan Horse–Consolidation or Revision-The Royden HOA has been a closed society for over 15 years. Year after year the number of nominees for open board seats is equal to the number of open seats. Potential dissenting members have not been allowed to serve. The Consolidated covenants were never implemented!!!! WHY??????? If the Royden Board were to implement CONSOLIDATED COVENANTS, they would have to admit that Article IV-Covenant for Maintenance Assessments is the controlling Covenant for annual assessment fixing for the entire community. This would in effect be an open admission that they have been improperly fixing annual assessments for over at least 15 years. THE ROYDEN BOARD CANNOT CONSOLIDATE OR THEY RISK SEVERE CONSTRUCTIVE FRAUD RAMIFICATIONS!
7. Royden Electoral College Analogy-The several subdivisions of Royden were explicitly designed, by the developers, as a form of statehood federalism. Here’s why. Phase III and Phase IV evolved into significantly larger and pricier homes, after the very successful Phase I/II roll out. Phase I/II has 94 homes, Phase III, 14 homes and phase IV, 30 homes. The separate subdivisions were explicitly formed to move the power base to Phase III and IV. With an overwhelming majority in Phase I/II (64) Covenant revisions or Special Assessment voting would always favor Phase I/II. Phase I/II has an amendment threshold pf 51%, III and IV is 2/3. Thus you see that III and IV have disproportionately more power….A mere 8 votes in Phase III or !6 votes in Phase IV, controls all of Royden’s future attempts to amend their CCR’s. Under the new covenants, Phase III and IV are the losers of power. That’s why you have to sign the documents.
8. The Royden BOD-Power Grab-NC GS 47 F-PLANNED COMMUNITY ACT-This repeat attempt, after the 2012 failure, can be only considered as a total disrespect for the intelligence of the Royden members. To avoid admission of guilt, and improperly fixing annual assessments, in violation of Article IV, they are deceitfully proposing to totally change the governmental structure of the Royden Community. The POWER BALANCE equation totally shifts from the members to the 5 person Board. Broad, A new Board with NEW and broad fining powers and even broader foreclosure powers. Why a new By[Laws….to give them more power….Why new covenants….To give them more power to develop measures for their vision of a PLANNED COMMUNITY. Why the equivalent of a “ROYDEN COURT” as one member calls it….to assess fines, limited by the NC GS 47F Law, to $100/day!!!!!! For VIOLATIONS!!!!!! What VIOLATIONS!!!!!! Violations will be constructed by the BOD with additions to the Covenants that the new power structure will add to the COVENANTS!!!!!! How else will they achieve their desired PLANNED COMMUNITY………The mere thought makes me sick!!!!!
9. PAST ROYDEN BOARDS HAVE BEEN CORRUPT AND INCOMPETENT-Let’s just take a look at some of the debacles’ these boards have foisted on the Royden community besides not complying to Article IV and using a non-budget ballot approval system including items unrelated to common area maintenance only as stated in the Article IV-PURPOSE
a. Sued an easement member costing the community $300,000 in legal fees.
b. Failed to obtain special assessment approval for the easement lawsuit
c. Reported deceptive financial reports for 4 years by concealing to report monthly accumulating easement legal fees for the multiple easement legal actions,
d. Lost control of the Moorland Drive Entrance easement area by forcing the easement holders to spend over $90,000.00 to win their case against the RHA.
e. Relations so bad with easement holders that they would not allow a pillar ball to be installed on the easement which requires pillar lanterns.
f. Orb installation replacing lanterns was never presented as special assessment and not approved by members under Article IV
g. Defamed the easement holders and refused to pay liability insurance on the easement property forcing them to void the easement agreement and leaving them to be seen as the aggrieving party by other neighbors
h. Failed to get members special assessment approval for street signage project and the necessary transfer of “all future signage responsibility” to the RHA as these areas were added to the list of common areas.
i. Not allowed member books and records review
j. Not had open board meetings
k. Not properly reporting Board meeting minutes
l. Not submitted special assessment approval of website creation by president’s son.
m. Not reporting application (twice) of Directors and Officers legal assistance against my lawsuits with estimated legal cost of over $30,000.00
n. Cash shortfall of nearly $4,000.00 in 2012
o. Manipulation of new/revised covenant voting by extending the closing time table and having non-board members calling members to solicit favorable votes
p. Defaming a member with libelous newsletter articles and attorney email publication in an attempt to “marginalize” a complaining member (me),
q. Spending hours in court and at arbitration hearing with not a single advisory word in the website minutes or approval by members.
r. Incorporating deceptive superfluous financial reporting formats, fiscal year end dates, inconsistent with established reporting convention of Profit and Loss and Cash Flow statement. A violation of GAAP and NC GS 55A 16-20 Law
s. Deviating from prescribed Annual Meeting and Fixing timetable in Article –IV
t. Consistently, for over 13 years, maintained a total assets/fiscal reserve above the mandatory 10% contingency reserve per Article IV, thus avoiding fiscal reserve credits to members.
u. Continuously using a non-compliant ballot voting for a non-compliant annual maintenance budget that included “non-maintenance only items “ such as legal fees and social expenses, which should have gotten separate special assessment approval
Attempted several CCR and by-laws amendments related to maximum annual assessment, fiscal reserves and fiscal year changes without specifically addressing the Provision Article, section or subdivision and referencing the old language, reason for change and new language. Covenant related changes never underwent the proper phase voting called for in the covenants.
v. Failed to assemble a member based architectural review committee for the review of member projects or reported any architectural approvals made by the RHA Board such as the multiple “BRICK PAINTING” projects evidenced in the community, without notice to members
w. CORRUPTED THE Board nomination process and proxy system to defeat a candidate for the Royden Board so that the easement lawsuit member could be reelected.
x. Allowed board members to remain in office for of times over 8 years by repeatedly offering number of candidates equal to the number of open position
NOW I ASK YOU, SINCERELY, IS THIS THE BEHAVIOR AND PAST RECORD OF LAWLESSNESS THAT YOU WOULD NOW ENTRUST TO CONTROL ROYDEN UNDER A NC GS 47F PLANNED COMMUNITY HOA COVENANT AGREEMENT
My apologies, this email length, in my opinion, is proportionate to the importance of the false initiative currently being presented to what the Board must consider as “lemming” homeowner population which one member insultingly said “HAVE MORE MONEY THAN SENSE”….This long email is the culmination of a fight I saw coming back in 2012….You now have the future in your hands…..Here is what I recommend WE DO!!!!!
The Planned Community initiative by the current Board is in violation, again , of Article IV –Covenant for Maintenance Assessments. WHY!!!
· The fixing of the 2018-2019 Annual assessment was in violation of Article IV
o It did not meet the 10%Contingency reserve in that the Fiscal reserves as of May 31, 2018 were $30,784.00.
o A nearly $27,000.00 credit or roughly $200.00 per member should have been distributed.
o The Annual Maintenance Budget presented included activities that were NOT COMMON AREA MAINTENANCE ONLY…Legal fees and Social expenses.
o If a “Revision”…(not consolidation, as deviously noted in the Presidents letter) to the Royden Covenants was contemplated, the RHA BOD should have presented a proposal stating specifically what the legal expenditure was intended to accomplish with the attendant estimate of the legal fees to be incurred. The membership would have then have had to approve the scope,,,and the estimate of legal fees to be incurred…..THIS DID NOT HAPPEN. This entire fiasco is yet another CCR VIOLATION!!!
o Instead of getting special assessment approval, the RHA BOD, surreptitiously included a $1000.00 Legal fee budget item, in what should have been a common area maintenance budget. The unsuspecting membership. Approved the non-compliant budget…along with $2,500 of Social costs…….Who is going to pay the legal fees and damages if some child suffers spinal cord damage on one of the ROYDEN bouncy houses!!!!! Or…who is paying for the added insurance for event insurance and policemen and firemen required at such an event!!!!! The most vulnerable is the member event planner!!!!!
o NOW ASK YOURSELVES, DO YOU REALLY BELIEVE ALL THE ATTENDANT LEGAL FEES BEHIND THE BY-LAWS AND CCR’S HAS BEEN ONLY $1000.00 bull!….The Sanctions rate they hit me for had lawyers’ fees at $350.00/Hour.