April 2009  

We do not make jokes, we simply watch the LA Times, the Orange County Register and CID/HOA board of directors and report the facts!

Implications of Restraining Order Against Third Mutual

Posted by CotoBlogzz  |  3/28,/2009 |  7:00 PM

In addition to questions raised by the process used by the Laguna city council to appoint Ms. Cynthia Conners  to fill the vacant seat left by the death of Mayor Pro Tem Brenda Ross, now the Third Mutual board  aka The Gang Who Couldn’t Shoot Straight, is in  a hurry up and wait mode in the process to name a replacement left vacant by the recent political assassination of Ms. K. McDaniel. 

The Third Mutual board of directors scheduled a special meeting at 3:30 p.m. Monday to designate directors to replace the vacancy left by Cynthia Conners,  who was appointed to the City Council on March 18, and a replacement for Ms. McDaniel.  However, according to court documents, the Honorable Frederick  P. Horn approved K. McDaniel’s application for  a temporary restraining order and preliminary injunction and ordered respondents: MOORE,  SOUSA, CONNERS, THE THIRD LAGUNA HILLS MUTUAL, ISABELL MEUENICHOW, KATHRYN FRESHLEY and JOHN PAULUS to appear before the Orange County Superior Court, April 20, 2009 1:30 PM to show cause, if any.  Hence, Ms. McDanield’s vacant seat remains.

The restraining order is intriguing on many levels and typically characterized as a David and Goliath battle, given that the establishment, in this case the Third Mutual has deep pockets in a protracted legal battle -  all it has to do is ask residents for additional funds. 

For this reason, often, the restraining order is issued against a resident, and not against a board.  Wit the case of a restraining order sought against 73 year old resident Lou Soken, because “:  “This was an action that was contemplated as a result of several threatening emails directed to PCM staff members,”  writes Wendy Bucknum  in an email to Laguna Woods residents, in an apparent attempt to explain why two PCM employees may feel threatened by the 73 year old resident, and why a restraining order was necessary.

So, what are the implications of a restraining order against the Third Mutual board and certain board members?  We asked various legal eagles, including legal counsel for the Third Mutual board

“It is interesting that historically most of the restraining orders and injunctions are usually filed by boards of directors or homeowner associations and against homeowner(s) who rarely have enough money to hire counsel to defend themselves.  Here, the very public injunction to which you refer is court ordered against six board directors.  As a homeowner, to me, this would raise a lot of interesting questions.  First, after the restraining orders were issued, what's the status of the association's insurance?  I'd want to know if these defendant-directors are still covered under my homeowner association's Director & Officer (D&O) insurance policy? “, says columnist and author D. Vanitzian.  Then she adds:

“These questions are important because as one Insurance Broker explained to me today, "intentional acts are typically not covered under indemnification insurance."  He asked, "Wouldn't that mean that the named directors are putting all association owners at risk because they may not be covered by the association's insurance policy?"  The Broker then asked whether "reservation of rights" letters were issued to the directors?  I discuss these topics in my book 2008 California Common Interest Developments-Homeowners Guide published by West, and in my latest 2009 edition not yet on the shelves,” and concludes:

“Second, as a homeowner, I'd want to know who's paying the directors' attorney bills and will that come back to bite the association in the ass?  The Insurance Broker explained to me that "any insurance defense or claim has the potential of raising the insurance rates for everyone."  Here, a bigger question might be, shouldn't this apparent breach of directors' fiduciary duties have the Defendants voluntarily stepping down from their board positions so as not to cause further grief or even liability?  One doesn't have to be a rocket scientist to figure out that a board with six court-ordered injunctions against it cannot function!  Albeit hypothetically, but in the best interests of the association, shouldn't these six directors do what's morally right and step the hell down from those board directorships immediately?  Here the yellow brick road bypasses Oz and leads to a courtroom.  It appears that this board is six on and six off, does that mean there is no quorum to conduct the association's business?  What happens to the decisions made by the half-cocked board?  Hello-out there!  Reality check: Spotlights are on the ALL these board directors”

Some have argued that the Third board defense hinges on the use of the term "designated" - however, a review of meeting minutes dated December 8, 2008 seem to render the argument moot.

	Comments.

PCM to Dethrone the King – Cash that is!

Laguna Woods Village - The current mantra for mortgage brokers is that under the current economic conditions, cash is king.  That is, if you have cash, stash it under your mattress, as opposed to spending it, given that the economy is simply going to get worse.

The Thrilla in the Villa: Laguna Woods, that is - The Ultimatum Posted by:  CotoBlogzz  | After a successful Initial Public Offering (IPO) and experiencing an exponential growth in revenue circa 1996, Gateway Computer issued an ultimatum to a computer peripheral supplier:  You can bid on a new product, however, you must significantly  improve the quality  AND reduce the price of the new product, or else.  The demands were so drastic that the CEO of the Taiwan-based supplier conceded in a press release, picked by by various local newspapers,  to having lost the Gateway account.

Another Political Assassination in the Works In The Villa Laguna Woods Village - “Village Snopes would be nice to dispel myths that are causing havoc on the mutual boards”, reads an article titled “ Rumors false, and published December 18,2007  by the OCR.  The article asserts that according to Third Mutual president Cynthia Conner, claims that the board is planning on removing director Stanley Feldstein are untrue. 

Demand for Full Scale HUD Investigation into Leisure World/Laguna Woods Affairs All homeowners of Leisure World/Laguna Woods Village  should demand a full scale investigation by HUD per the Regulatory Agreements. Remember there are two(2)
Regulatory Agreements, one (1) between Laguna Hills Mutual No.One (United) and HUD and the other Regulatory Agreement between Golden Rain Foundation (GRF) and HUD

Support Katie McDaniel Notice was received this morning of the Special Board Meeting, for the purpose of removing Director Katherine ( Katie ) McDaniel from the board. No reason or justification was given for her intended removal.

Bring it On In a recent article I discussed how newly elected HOA directors suddenly exhibit behavior changes closely related to the Stanford Prison Experiment.  In this psychological experiment random student volunteers were divided into guards and prisoners and then began to live their roles, showing signs of paranoia, sadism, and brutality

Fiduciary Responsibility Primer – Part One  -What is the common denominator between Denmark’s Entrepreneur of the Year, KPMG, Aide to Madoff HOA/CID board of directors’ fiduciary dut

PCM & Third Mutual – The Ultimatum

Cynthia Conners Being Asked to Resign The Laguna Woods Village Shareholders Committee is asking Third Board director Cynthia Conners to resign her positions on the board for a number of alleged ethical violations.

New Third Laguna Hills Mutual of Laguna Woods Village Board Seated  The Third Laguna Hills Mutual of Laguna Woods Village seated the new board for that housing mutual today. Officers include Carol Moore, President; Stan Feldstein, 1st Vice President; Don Lippert, 2nd Vice President; Kathryn Freshley, Secretary. The voting was done by secret ballot and the anticipation of the members present was that business would proceed without the roadblocks of the past year.

The Devil Made me Do It - Blame it on the Loopholes
During Thursday?s CZ Master Association?s Candidate?s Night designed for Coto de Caza residents to meet the candidates running for two seats on the CZ Master board, the first question mischaracterized our position, asking an either or question: ?Buzz...

The Right LWV Leadership for Such a Time as This?
Is this general manager (Milt Johns) over his head in his management skills? Can someone come out with only experience from the garden to manage a 90 million dollar business without a conflict of interest? When is the last time Mr. Johns lowered our costs...

The Wealth (or Erosion of) of Homeowners Association
We previously made the argument that analogous to how a wealth of nations is determined, one can use a similar approach to measure the wealth of an association ? such wealth is over an above ?book value? - such as the CZ Master Association, for example...

Resident?s Voice, a Laguna Woods Village volunteer association, critical of the property management company and the non-profit homeowners association, today announced the launch of what they call Phase 2 and are asking other Laguna Woods Village Residents...

Laguna Woods Village CC&Rs, What CC&Rs? I Got Your CC&Rs Right Here!
Coto de Caza is not the only place where the board of directors consistently either disregard the civil code, governing documents (Covenants, Conditions and Restrictions - CC&Rs) or even the moral code.

Should I stay or should I go - in/from my HOA? X
First was the Delegate?s Corner blasting CZ Master Association board of director?s critics for speaking out against a corrupt delegate system and electoral process in favor of direct elections, consistent with current legislation, and consistent with the...

Mirror, mirror on the wall, who is the fairest gladiator of them all?
As I stood atop the Roman Colosseum during a recent trip, emotionally gripped by its horrific history, I couldn?t help but make the connection between the ancient gladiator and my role as in-house attorney,?.. For starters, lawyers are often referred to...

Chuck Chuckles: Senator Schumer, That is
Those who do not know, go to law school. Those who do not do, blame. Those who do not know and do not do, join the US Congress. Senator Schumer has asked the Government Accountability Office to investigate if rising gas prices are the result of oil...

Pssst, Can I Interest You In a Lawyer?
When there are too many policemen, there can be no liberty.When there are too many soldiers, there can be no peace.When there are too many lawyers, there can be no justice.Lin Yutang (1895-1976), Chinese-American writer, translator, and editor.This...

Dare's role in Pastures cost association $100,000
By BRENDAN J. LYONS, Senior writer First published: Sunday, Times Union August 12, 2007. Republished with permissionAugust 12, 2007 ALBANY -- An advocate for the Historic Pastures Homeowners Association, which lost more than $100,000 in...

Select Blogzz & click icon

RedCounty NewzzVinezz FeedBurner CotoBlogzz CotoBlogzz Y!360Blogzz

Archived Issues

Advertising rates/info

CotoBuzz Classified

General Information

ADVERTISEMENT