What Happened to the Rule of Law?

320

(Reading This is Not for the Fainthearted—It’s Long!)

By Lisa M. Bartlett – 52-year association with the Covenant, Over 20-year Member of the RSFA

For decades, homes in the Covenant were built in accordance with the mandates/guidelines (hereinafter mandates) set forth in the Protective Covenant (PC). Following the PC yielded homes of “high artistic merit,” having understated elegance, with a low profile, that were in harmony with the natural terrain. In the not too distant past, the CDRC, without the proper Board oversight, with, at a minimum, tacit approval of some Boards, allowed major deviations from the mandates set forth in the PC. The PC provides for a vote of the membership, if the community wishes to change the mandates set-forth therein.

On April 1 the RSFA Board held a Special Meeting to determine whether former RSFA Board member, Jane van Praag, who had been serving on the CDRC (Art Jury), would be removed. When Jane went on the CDRC, she “discovered” the mandates of the PC (Par. 153. Section. 28—Par. 164). Reading through these sections, Jane came to understand that the mandates of the PC were often not being followed by the CDRC and some Boards had not/were not providing proper oversight as to what types of structures were being built. At the end of the meeting, Jane resigned. Jane felt she had no choice, as her removal was preordained.

Was Jane guilt-free? No. Could Jane be abrupt and insensitive? Yes. However, some of the things that have happened relating to the CDRC, the processes followed by the Board and the lack of adequate supervision by the Board were seriously flawed too. This should give all RSFA members reason to be deeply concerned.

Let’s look at three of the events that took place during Jane’s tenure on the CDRC:

1. Changing the Minutes of CDRC Meeting

There was a very serious incident, early in Jane’s tenure, that set the tenor for the discord that followed. In August of 2017, Jane applied the PC requirements she had “discovered”, for the first time during her tenure. Jane and two of her fellow CDRC members voted 3-2 to disapprove a non-conforming project. Without a noticed meeting, the following day, the then President of the CDRC, Secretary of the CDRC, and the former building Commissioner, without the knowledge of Jane, reversed the outcome of the vote, changing the Minutes and the letter to the Applicant and then asked Board President Wasserman to remove Jane. Jane refused to resign. President Wasserman met with Jane and the CDRC President to resolve issues in mid-September.

In mid-September 2017, Jane discovered the Minutes had been changed. When she asked that the Minutes be corrected to reflect what had actually been voted on, the then CDRC President denied any changes had been made. Finally, the President confessed the Minutes had been changed. The Minutes were eventually corrected. Jane reported the wrongdoing to the then Board.

2. Residency Requirement Waived

RSFA Board Resolution # 2017-111, adopted August 3, 2017, states in part: “ 2 (a)….Each prospective CDRC member shall be a resident at a Building Site immediately prior to the nomination of such prospective CDRC member.” 2 (b) “Have no pending projects that involve the construction of a new building or enlargement of an existing building with the CDRC;” 2 (c) “Demonstrate knowledge of the Rancho Santa Fe Protective Covenant;”….

By the December 15, 2017, Board meeting, only four months after the adoption of Resolution 2017-111, the RSFA Board had five CDRC candidates, for two openings, that were presented to President Wasserman. The President is the individual that officially makes CDRC appointments. Four of the five candidates lived in the Covenant at the time of their application. One did not. The Minutes reflect the five candidates had been vetted by Board President Wasserman, Board members, Steve Dunn and Ken Markstein, Hilary Loretta, outgoing CDRC President,and Tom Farrar, the then Building Commissioner.

It should be noted that the Board Minutes from the December 15 meeting state all five candidates “…met the requirements of Resolution 2017—111, Policy for CDRC Nomination.” This is not accurate. The Minutes then go on to state that “President Markstein (really, Vice-President then) moved that the Board grant a waiver for the residency requirement at a building Site of Shaunna Salzetti-Kahn [current President of the CDRC] to be considered, whose house was under construction and would not be completed until February 2018. Director Dunn seconded the motion. The motion was passed 7/0.” (Members of the Board: Fred Wasserman, Ken Markstein, Janet Danola, Steve Dunn, Allen Finkleson, Mike Gallagher and Rick Sapp)

The President of the RSFA then appointed the current President of the CDRC to the Committee. It should also be noted that RSFA Board Resolution #2017-111 requires that for an individual to be considered as a prospective CDRC member, they must have: “No pending projects that involved the construction of a new building…with the CDRC” and “Demonstrate knowledge of the Rancho Santa Fe Protective Covenant.” There is nothing in Resolution 2017-111 that addresses the issue of the current CDRC President having a pending project. It is also a stretch to believe that someone who had only rented in the Covenant for a few months would be able to demonstrate knowledge of the Rancho Santa Fe Protective Covenant, a very long, complicated document.

Ask yourself, why would the President, with the concurrence of the Board, turned down other qualified candidates, who had relevant experience gained by living in our community, in favor of a candidate who had only rented in our community for a few months, was not residing in our community at the time of her application, was building a house that she apparently didn’t move into until late summer 2018 and needed a special waiver?

3. Board Speaks Out to Membership and Then Reverses Itself with Resolution 2019-103

On February 7, 2019, the Board send two memorandums to the CDRC and then on February 11 sent the memorandums to RSFA members. Two of the key statements in these two memorandums are:

A. “The Board has been advised by legal counsel that the CDRC is subject to the Board’s oversight and supervision. The Davis-Stirling Common Interest Development Act and California Corporations Code mandate that the Board has the ultimate direction of its activities. It is the responsibility of the Board to ensure that the CDRC enforces the Protective Covenant, Regulatory Code and Residential Design Guidelines on a fair and consistent basis….”


B. “Specifically, members of the Board and our community have noted excessive grading projects with unrestrained mass and scale, and buildings that are inconsistent with Latin-type design. The CDRC should: Give great care when considering grading, mass and scale and type of design. The decisions made by the CDRC are not temporary and leave a lasting mark on our rural community….”

Then What Happened?

On March 7, 2019, the Board adopted Resolution 2019-103 by a 4 to 3 vote. This Resolution can be found in the Members Section, under the Board section, under Resolutions but was not sent to members, as were the February 7 memorandums. The Resolution, in part, states:

A. “Paragraph 157 of the Covenant sets forth the type of architecture of buildings or structures permitted in Type I Architectural Districts. While the CDRC may exercise the discretion afforded it by Paragraph 156 of the Covenant in determining whether the architecture of a proposed building or structure is of a type ‘deriving its chief inspiration directly or indirectly from Latin types, which developed under similar climactic conditions along the Mediterranean or at points in California, such as Monterey,” providing that its discretion is properly exercised and founded on sound reasoning, the CDRC may not exercise its discretion to approve a building or structure having a different type of architecture.” 

B. “’California Ranch Type’ is a type deriving its inspiration directly or indirectly from Latin types,’ and, therefore, is permitted by Paragraph 157 of the Covenant….”

There was nothing in the February 7 memorandums that mentioned “California Ranch Type.”

  1. Where did this come from?
  2. Where in the PC is there a description of “California Ranch Type,” being acceptable?
  3. Why was there such a major change from the notice sent to the membership on February 11, without a community-wide discussion and vote?
  4. Under what authority does the Board have the power to provide their interpretation of such a change to the PC, without the requisite “…not less than two thirds” vote of the membership, as set forth in Par. 164 of the PC.

Something that is very disturbing is Resolution 2019-103 does not show that three Board members (Directors Dunn, Gallagher & Ruhnau) dissented to the adoption of this Resolution.

  1. Why were their voices not heard?
  2. Did they dissent because they believed the PC was being circumvented? We don’t know, as there is no record of their thoughts, let alone an official record that they dissented.

Background Regarding April 1 Hearing:

Jane was asked to attend a meeting on Friday afternoon, March 15, by the President of the Board, Ken Markstein. Jane asked the President what the subject matter of the meeting was to be. The President declined to advise Jane as to the nature of the meeting. When Jane showed up for the meeting, expecting to meet only with the President, she was surprised to find him accompanied by Board member, Mr. Finkelson, a retired corporate lawyer.

Jane was advised, in a nutshell, that due to her alleged behavior, Mr. Markstein and Mr. Finkelson appeared confident they had the requisite six out of seven Board votes to remove her from the CDRC. There was no mention by these Board members that some of her fellow CDRC members also had significant negative issues associated with them.

Jane was encouraged to quietly resign, or, if she wanted a hearing, to do so in Executive Session, where no other RSFA members or the press would be allowed. They did advise her that she had a right to a “public hearing.” Mr. Markstein also advised Jane that the Board would officially decide whether to remove her from the CDRC, whether she chose to be present at the April 1 meeting or not. (Members of the Board: Ken Markstein, Allen Finkelson, Janet Danola, Steve Dunn, Mike Gallagher, Sharon Ruhnau & Rick Sapp).

Jane was requested to advise the Board by Tuesday, March 19, one business day to decide, as to whether she would resign, or not. Probably to the great surprise of the Board, who had hoped she would quietly resign or have a hearing in Executive Session, Jane elected to have a “public hearing.” Jane wanted to set the record straight and clear her name. At the Friday meeting, Jane was presented with a stack of materials, presenting the “evidence” against her. The Board, at this point, was aware that Jane was departing the next day for a long-planned, out-of-state vacation, during which time Jane didn’t have access to her files or her computer.

Over the coming days, multiple issues arose, three of which included:

  1. Would a reasonable extension of time be granted to Jane so she could adequately respond to the stack of materials she had just been handed on Friday afternoon? Board Answer: No
  2. The PC, Par. 69 states: “Any member of the Art Jury may be removed from office…after a public hearing, of which at least 15 days’ notice shall be given to all persons concerned….” The RSFA Board posted in the members section, by no earlier than March 27, a notice of hearing, relating to the April 1 meeting. This notice was buried in the Members’ section, under the Board section, under Agendas. The RSFA apparently posted on the bulletin board at the RSFA office, a notice of the hearing no earlier than March 27.

    Jane objected to the fact that the required 15-day notice was not given. The Board disagree that the membership was required to be given “…at least 15 day’s notice…” The Board indicated they only need to give four days notice.

    Jane objected that the proper notice had not been “…. given to all persons concerned….”

    A. How many RSFA members go to the RSFA office to regularly check the bulletin board?

    B. How many RSFA members regularly search the RSFA website looking for buried notices of hearings?

    Mr. Markstein and Mr. Finkelson indicated to Jane, they hoped she would resign, or if she insisted on a hearing, that it be done in Executive Session. If she insisted on a “public hearing,” which she did, a fair conclusion is that the Board didn’t want an audience. To the extent there was an audience, approximately 30 individuals, it was because a few members passed the word, not because there was any meaningful “public notice,” as there was not.

  3. Jane asked about potential insurance coverage for herself. Jane inquired about counsel to represent her at RSFA expense or under the RSFA policy. She was informed that no counsel would be provided. The Board members, at no personal expense, consulted with RSFA counsel. Not many volunteers have the financial wherewithal to pay out of their own pockets for a lawyer and if they have the means, few would elect to do so. Not having access to counsel put Jane at a distinct disadvantage, to say the least.

How Our Community Got Into This Mess

If the situation described by the Board concerning Jane is factually accurate, one must ask:

1. Why did it take so long for the Board to act?

2. Why was the Board in such a great rush to have the hearing concerning Jane’s removal done almost “overnight”, when the alleged situations had been going on for over two years?

Until Jane came onto the CDRC, prior CDRC members (which now includes all current CDRC members), including Mr. Markstein, who served on the CDRC for three years, and most Boards either:

A. Didn’t know what the PC architectural mandates required (including the possibility of changing the mandates by way of a community vote) or

B. They knew what the mandates were and, at times, chose to willfully ignore the mandates or, put the issue to a community wide vote, as provided by the PC.

The Boards of the past two plus years have been aware, if they hadn’t been before, due to Jane’s bringing it to their attention, what the mandates of the PC were in terms of architectural issues.

3. Why didn’t the Board try to solve the situation involving Jane by mediation? Yes, this would have taken longer, and probably would have resulted in the issue still being “alive” in the midst of the upcoming Board elections but wouldn’t that have been a wiser/fairer path to follow?

4. Why did the Board, speak of “Latin-type design” in its February 7th memorandums directed to the CDRC, consulting architects for the CDRC and Manager of the RSFA, with the memorandums being forwarded to the membership, never mention “California Ranch”? Then, a month later, in Resolution 2019-103, without community input, the Board seemingly reversed itself and made a finding that “’California Ranch Type’ is of a type ‘deriving its inspiration directly or indirectly from Latin types,’ and therefore, is permitted by Paragraph 157….”?

A. How did they make the determination that ‘California Ranch Type’ is Latin inspired?

B. Did the Board have the power to make this change without the minimal 2/3rds vote of the RSFA membership?

C. Why didn’t Resolution 2019-103 ever see the light of day in terms of RSFA member input before a vote of the Board?

D. Once adopted by the Board, in a 4/3 vote, why was the RSFA community not advised there had been major changes from the February 7th memorandums?

5. Why is there no mention by the Board at the April 1st hearing of Jane’s regular requests for the Board to supervise the CDRC and to make certain that the relevant paragraphs of the PC were being followed?

6. If the Board liaisons to the CDRC were doing their jobs, why didn’t they speak up, indicating they didn’t think Jane’s behavior was appropriate and take action then? The Minutes of the CDRC, starting in September 2017, indicate the Board liaison was Ken Markstein. In the October 2018, the Minutes list the Board liaisons as Ken Markstein and Steve Dunn. Going forward, it appears the Board liaison was Steve Dunn. A review of the CDRC Minutes show that starting in November 2017, there were many CDRC meetings where there was no Board liaison present. (There are no Minutes on the RSFA website re CDRC meetings since the December 18, 2018 meeting and no Minutes relating to the Board meetings since the January 3, 2019 meeting.)

These Questions and Situations Should Matter to You as a Member

Who is going to be willing to volunteer their services as a member of the Board, the CDRC or any committee, if they know that the “Rule of Law” may not be followed? Don’t we all want to know that the PC is either being followed as written, or amended as provided for, if we wish to change it, rather than changing the PC without following the legal process provided?

Don’t we all want “adherence to the principles of supremacy of law, equality before the law, accountability to the law, fairness in the application of the law, separation of powers, participation in decision making, legal certainty, absence of arbitrariness and procedural legal transparency”?

A multitude of examples exist of individuals who perceive real wrongdoing in our community, yet they are afraid, with very good reason, to come forward for fear of retaliation. Is this a community any of us really want to be a part of?

Watering down or ignoring mandates in our Protective Covenant and all members not receiving fair, equal treatment should concern you. Is Board oversight of the CDRC and other committees of the Board being undertaken in a thoughtful, thorough manner? Allowing years of erosion of failure to follow the PC, or change it as provided, takes its toll on individual homeowners and diminishes all our property values.

Where This Leaves Us

For me, this is not about whether one likes or dislikes a particular architectural style, be it Latin inspired, California Ranch, Craftsman, Colonial, Log, Modern or any other. The question is: Do we adhere to the mandates of the PC, which provides for a vote, if the community desires to change the PC, or do we willfully ignore the PC?

Oversight, transparency, good governance, trust, willingness to follow the PC and other governing documents, are easy slogans for campaigns and members seeking position on committees. However,the real test is “walking the walk”. Sadly, examples of lack of following through with these campaign slogans or assurances by prospective committee candidates abound:

  1. Not following the PC, or amending it by a community vote;
  2. Allowing minutes of an official RSFA meeting to be changed, without immediate intervention by the Board;
  3. Not following a fair and transparent process regarding volunteer members;
  4. Adopting a very important Resolution, “in the dark of night” and then not publicizing it;
  5. A Board essentially forcing a CDRC member to resign in a big hurry, when no explanation as to why there was a need for removal to be accomplished in such a rush;
  6. Not giving effective notice of a very important community meeting and
  7. Lack of Board/liaison oversight, especially when alleged problems are taking place.

All of this makes one question why anyone would volunteer to serve, unless a member is willing to ignore the mandates set forth in the PC or, truly is dedicated to making certain that things are done in accordance with the PC and “Rule of Law.”

Such transgressions should not be tolerated by our Board and our community. When the Protective Covenant and “Rule of Law” are not followed, fear, confusion and chaos ensue.

 


Discuss this article in our Community Discussion Forum in the Association Forum.