Thursday, February 26, 2015

Now That We're in Receivership.......


As of Friday, February 13, 2015, the Cedar Run Homeowners' Corporation (aka "Master Board") has been officially in receivership.  Under the leadership of Robert Sher and Jack Shaw, who have blatantly disregarded the rule of law, the HOC board has effectively been stripped of all powers.

What is Receivership?
Receivership, in the case of community associations, occurs when a court assigns a third party (aka a 'receiver') to assume control over that association.  This happens when an association has effectively become un-governable under its current board of directors and structure.  Most often, receivership is ordered when an association is essentially broke (i.e. expenses aren't being paid), and a judge must order a receiver to take control of its finances and bring the association back to financial solvency.

However, receivership can also be ordered when an association's legal problems run so deep, that they cannot be solved with the current board in power.  This is what we are dealing with in Cedar Run.

The receiver has been charged with three general tasks:
  1. Run the HOC legally and in compliance with our governing documents until a proper election takes place.
  2. Assist a CPA firm, as necessary, to perform a full audit of the financials from 2011 to present.
  3. Prepare and administer the election of an entirely new board, currently scheduled for May 2015.
The receiver will work to ensure all the information uncovered from the audit (item #2) is made available to homeowners.  Yes, all that 'Transparency' that Robert Sher promised us from day one......apparently takes a court-appointed receiver and CPA firm to make it a reality.

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Why are we here?
The list of unlawful things that the Sher group has done since taking power is virtually endless, and we won't even bother listing or discussing them now.  However, the fact that Sher has operated for so long without a single election is what started a series of events that landed us in receivership.  That, compounded by the bogus Bylaws that Sher pointed to as justification for his refusal to hold elections, has ultimately led to his (and the board's) ouster.

Just about every other unlawful act from the Sher group has stemmed from these 'Bylaws' and Sher's refusal to hold elections.

1. Bogus Bylaws
There are countless reasons why these bylaws are blatantly illegal....again, we will leave that topic alone for now (if you've read the court transcripts, you've seen what the judge thinks of them).  These bylaws were essentially a manifesto that showed exactly how Sher wanted to run the association. The judge declared them invalid and saw them as clear proof that the current board could not operate legally and properly.

We will revisit the specific illegalities of these Bogus Bylaws in a future blog post.  For now, feel free to read an older blog post entitled 'Bylaws, The Untold Story' for some history on the topic.

2. No Elections
The one safeguard that a community has against their association's Board of Directors is the ability to vote them out if they are displeased.  Whether it's failure to follow state laws and/or governing documents, mismanagement, unpopular rules/policies, or any other reason homeowners are displeased, annual elections and special elections allow them to change the way their board operates.

Sher eliminated the one true power that homeowners have to dictate how their association is run.  Isn't it ironic that he did this, all while claiming to be a populist and an advocate of the people?  Did homeowners ever ask to have their voting rights revoked?

Had the Sher group handled the elections properly, we would have had annual meetings (elections) in May of 2013 and May of 2014.  All director positions on the HOC board except for one (specifically Barbara Shaw's) would have been up for reelection between these two annual meetings.  You can clearly understand why Sher did not want these elections to happen.

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So, What Now??
  • Per the court order, the HOC board and Oversight Committee have been stripped of all powers. (see page 2, paragraph 1, lines (a) through (f) of the court order)
    • They cannot contact or address homeowners in any kind of official way.....no mailings, posting, Q & A sessions, etc.
    • They cannot issue checks, enter or cancel contracts, or manage vendors and/or contractors.
    • They cannot conduct board meetings or homeowner meetings.
  • All financial records have been seized (or are in the process of being seized) and turned over to the accounting firm for their audit.
  • Robert Sher and the HOC board  have been banned from using the clubhouse. Only the receiver and any staff that the receiver permits can conduct business in the clubhouse.
  • Homeowners should receive a letter from HHSG (Heil, Heil, Smart & Golee, aka the receiver/manager) very soon:
    • This letter will explain who they are and what their role is with Cedar Run
    • It will likely reiterate portions of the court order and explain that the Sher group is no longer in power.
    • It will likely include new assessment payment instructions and a new payment address.
TO BE CLEAR
ROBERT SHER HAS NO AUTHORITY WHATSOEVER OVER THE HOC

If Sher, any of the board members, or anyone else tells you something different, they may be violating the court order, and we'd love to hear about it.

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What should we do?
  • Continue paying your HOC assessments
    • Even if we receive new payment instructions from the receiver, your March 2015 payment will still be accepted if you had already sent it to the old payment address.
  • Continue paying your Phase assessments
    • Nothing in the court order or receivership arrangement affects your phase association payment.  To avoid late charges, continue paying your phase dues as you have in the past.
  • Read the receiver's letter carefully
    • There will be other important information in the receiver's letter aside from payment information.  It is important that homeowners fully understand the situation in Cedar Run.  We will post a summary of this information on the blog, but we still recommend reading the letter yourself and calling HHSG (the receiver) with any questions.

This coming May (or whenever the election finally takes place), Cedar Run homeowners will have a clear choice...
  1. Do we repeat the same 'Robert Sher Experiment' that ultimately brought us into receivership?
  2. Or do we move on and try to manage our property responsibly and legally??

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Please do email us at restoreCR@gmail.com, call or text the hotline at (224) 544-9058, or use the comment sections of the blog for any questions, comments, or concerns.

Stay tuned for more information



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Monday, February 16, 2015

It's Official - Cedar Run HOC Now in Receivership

As of Friday, February 13th, 2014, The Cedar Run Homeowners' Corporation (aka HOC, aka 'the Master Board', aka the Sher group) is now in receivership.

A full copy of the court order can be viewed by clicking HERE.

We will post a more detailed summary of the order within the next few days, but we encourage you to read through the entire order.  The order makes it very clear that Robert Sher, Jack Shaw, and all of the directors on the board have been stripped of their powers. The order states "That the sitting board of the HOC has no authority to direct the actions of the HOC." (Page 2, line 5)

We will also post more information in the coming days to help clarify what it means to be in receivership and the unique circumstances for Cedar Run.  But for now, a few points of clarification:

  • The receiver is Al Schroeder from the property management firm Heil, Heil, Smart & Golee (HHSG).  You can learn more about this firm by clicking the following link to their website:  http://www.hhsg.net
  • It is only the HOC (aka 'Master board', aka the Sher group) that are in receivership.  The eleven Phase Associations in Cedar Run ARE NOT in receivership.  This order has no effect on your Phase board or management company.
  • Homeowners are strongly encouraged to continue paying their assessments without interruption.  This must be done exclusively by mail, as the receiver will likely not allow for payment collection at the clubhouse.  
***UPDATE-----2/17/15***
Office hours have been posted at the clubhouse and will remain in effect until March 15.  There may still be staffed office hours after March 15, but those hours have not yet been announced. Homeowners are encouraged to check the clubhouse postings for the most up-to-date office hours.  We will, of course, post new information as we receive it.  We do NOT know if assessment payments will still be accepted at the clubhouse after March 15, but we hope to get clarification soon.
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Please do contact us at restoreCR@gmail.com or use the comment sections of the blog if you have any new information to share with the community.
 

Stay tuned for more information



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Monday, February 9, 2015

Cedar Run Legal Update - 2/6/15 Court Transcript Available

On Friday, 2/6/15 , after almost two months of the Sher group's stall tactics, frivolous objections, and refusal to accept the inevitable ruling against them, the Judge has FINALLY put a stop to it!

Feel free to read a transcript of the proceedings by clicking HERE.

On 12/22/14, the Judge made it clear how he felt about the Sher group's Bogus Bylaws and their right (or lack thereof) to govern under them.   He then afforded them every opportunity to work out an agreement on how Cedar Run would transition to the control of a third party (aka 'receiver'), who would ensure that the association were run legally up until a May 2015 election.

Long story short, Sher and the HOC board refused to accept any terms that would relinquish ANY of their authority.  This unrealistic expectation and refusal to accept the consequences of their past actions will likely lead to them being stripped of virtually ALL of their authority.

What happens next?

  • As mentioned in the transcript, a T.R.O. (Temporary Restraining Order) will be entered.  (It has most likely already occurred, but we will not report it until we have confirmation) ***UPDATE*** Confirmed! We are now in receivership.***
  • This T.R.O. will likely name a receiver and spell out details on the receiver's authority. ***UPDATE*** Al Schroeder from a management company named Heil, Heil, Smart, and Golee is the receiver.***
  • There will be complete financial audits going back to Fiscal Year 2011.
  • The election will be sometime in May, but there is slight chance it could get postponed if the above audits are not complete and available to homeowners by then.
  • And once again, we are proud to say, NO PAY for SHER, SHAW, ANY DIRECTOR, OR THEIR FAMILIES!!
Once the details are known, we will post them on this blog, so please stay tuned!

restoreCR@gmail.com
(224) 544-9058



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Thursday, January 22, 2015

Cedar Run Legal Update

There have been three court appearances since our last blog post.  Nothing major has happened since then, but we are getting very close to resolving all open concerns.

What we do know:
  • There will be an election in May 2015 for the entire HOC board
  • The election will be supervised by a CPA firm to ensure it is administered correctly
  • This same CPA firm will perform a full audit of all financial records, which will show how our money has been handled over the past 2-3 years
  • In the moths leading up to the election, Robert Sher and Jack Shaw WILL NOT BE PAID with homeowner funds

What still needs to be determined:
  • Who the receiver and/or management company will be (it is possible that a management company can serve as both)
  • What authorities/responsibilities will go to the receiver and what (if any) will remain with the HOC board.

In the meantime, if you receive any correspondence from anyone claiming to represent the HOC or Oversight Committee, please bring it to our attention.  Whether it's a mailing, posting on your door or garage door, sign posted on the property, or a phone call encouraging you to attend a meeting or sign something.....it may be a violation of the court's 'Stand-Still' order, and we'd love to know about it.

restoreCR@gmail.com
(224) 544-9058




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Monday, January 5, 2015

Cedar Run Legal Update - Next Court Date 1/08/2015

A Belated Happy New Year from the Cedar Run Concerned Homeowners!

The next court hearing in the Cedar Run legal saga will take place on 1/08/2015 at 10:30 AM at the Daley Center.  If you haven't read the full summary of the 12/22/2014 hearing, you can do so by clicking HERE (we have updated the information since posting, so do consider a second read even if you've already read it).  To view a transcript of the 12/22 hearing, click HERE.

At the next hearing (1/08/2015), we expect that a receiver will be selected to manage Cedar Run up until the May election.  We also expect there to be much debate over what responsibilities will be delegated to this receiver.  The final word on the receiver's authority will have a major impact on what powers (if any) the current HOC board will retain.

Why the Silence form Sher & Company?
There currently is a 'Stand-still' order in place that forbids Robert Sher or the board from sending or posting any official communication to homeowners (which they violated by posting signs about the 12/22 hearing).  This is why no homeowners have received anything (exception being the posted signs) from the 'Master Board' and/or 'Oversight Committee' (aka Robert Sher).  If history is any indicator, we probably would have been barraged with propaganda by now if this order were not in place.


Board Powers Restricted by the Court
This same stand-still order also restricts or forbids the current board from making payments or entering contracts.  We are still waiting to hear more exact details about this specific item, but it is fairly clear that no payments to board members and/or their families are allowed (which pretty much cuts off the oversight committee - Jack Shaw & Robert Sher).

The judge did acknowledge that the property must be maintained and snow must be removed, even during these legal proceedings.  We see no reason that the court would prevent the board from paying for any of these services.

We will post another legal update as soon as new information rolls in.  Please stay tuned!



We'd love your feedback!
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Monday, December 29, 2014

12/22 Court Hearing - Full Summary

**UPDATE - 12/29 COURT HEARING CONTINUED TO 1/8/2015**
***UPDATE - 12/22 TRANSCRIPT NOW AVAILABLE***
 
We hope everyone had a Happy Holiday, and we appreciate your patience in waiting for this more thorough summary of the court hearing on 12/22.  Click HERE to view the court transcript from 12/22.  Please do also note that as this blog is being posted (12/29), additional developments are taking place in court that may fill in some additional details that were not finalized on 12/22.  **UPDATE - CONTINUED TO 1/8/2015**

First, a brief background of what has occurred in the last few weeks:
(If you want to skip the background, scroll down to the headline 'So What Happened in Court?)

December 9th, 2014, Judge Garcia finally heard arguments from both sides over the question of elections for Cedar Run.  The Sher group's only defense or excuse for not holding elections in over two years was a controversial Bylaw document that they created in December of 2012 to replace Cedar Run's original Bylaws from 1972.  In nutshell, the Judge refused to acknowledge these bogus Bylaws as a binding governing document, and he expressed real concerns over the validity of a board that has operated under them for two years without elections.

Click HERE and HERE for two blog posts about that specific hearing or HERE for a transcript of the proceedings from 12/9.

At a brief hearing on December 17th, the Judge had asked both sides to work out an agreement over how to make up for the two consecutive election cycles that were skipped and how to govern Cedar Run until a proper election is held.  In the interim, the HOC (aka 'Master Board') was forbidden from making any payments to board members or their families, from making announcements or mailings to homeowners, or from entering any contracts.  No agreement was reached about how to handle the election and governance of Cedar Run, so both sides then had to argue their respective cases in front of Judge Garcia on December 22nd.

Using this blog, we had strongly encouraged homeowners to attend this December 22nd hearing to hear what Judge Garcia had to say. In response to this, the Sher group posted the following signs at the entrance/exit of Cedar Run and at the clubhouse.



Notice that the sign written in Spanish has a great deal more content than the sign written in English.  The Spanish sign translates to "HISPANICS, The future of Cedar Run is at risk! We need your support on Monday 22nd at 7:30am. We will reunite at the club house to go to court. It's very important that you accompany us! Your house could be at risk or even have a high and excessive payment."

In addition to posting these signs (which violated the court order that forbids announcements of any kind), the Sher group also spent the weekend making phone calls exclusively to Hispanic homeowners and urged them to either accompany them in court or head to to the clubhouse and sign a petition.  As reported by concerned Hispanic homeowners who received these calls, they were told that "ALMA is suing the [Cedar Run] Master Board, and you might lose your home if you don't sign a petition or show up in court" (Many things wrong with this claim, one being that ALMA has nothing to do with the lawsuit in question).  Other homeowners reported that they were told that the court transcript of the December 9th hearing that was posted on this blog was a FAKE.........Dirty politics and manipulation at their worst!



So, What happened in Court?

Here are some highlights, followed by longer explanations on each point:

  1. Contrary to the Sher group's signage, the future of Cedar Run was not decided on December 22nd, 2014, but it will be decided by the homeowners in May of 2015 (pending an official order confirming the election time-frame).
  2. There will be a receiver appointed to manage Cedar Run (pending an official order).  The receiver's authority is likely to be finalized at the 12/29 hearing. **UPDATE - CONTINUED TO 1/8/2015**
  3. Full financial audits/reviews will be conducted of the past three fiscal years, and results will be made available to all Cedar Run homeowners.
  4. Temporary order restricting payments and forbidding announcements extended until election (possibly expanded).
  5. The Judge stated quite clearly that nobody will lose their home as a result of the court's decisions on this case.
  6. Caryn Shaw unsuccessfully tried to SILENCE THIS BLOG.  Judge would not agree.

1. Future of Cedar Run
The primary reason that the courts had to get involved is the fact that there has been no annual election for the Cedar Run Homeowners' Corporation (aka HOC, aka 'Master Board') for two consecutive election cycles.  The only elected (not appointed) director on the HOC board that is currently serving an unexpired term is Barbara Shaw.  Effectively, the entire board (except for one director) could have been turned over by a vote from Cedar Run homeowners by now.  We were deprived of that opportunity.

So here we are at the end of the year, awaiting a final order for an election.  If an 'immediate' election via a 'Special Meeting of the Members' were to be held, it likely wouldn't happen until sometime in mid to late February----proper notice, planning, nominations, arranging for auditors to supervise, etc.  Three months later (in May), the HOC (per the real bylaws) must then conduct an annual election, which should probably also be supervised to the same extent as the Special Meeting.

For these reasons (although it's not etched in stone yet), all parties seem to have agreed to a May election that will cover the ENTIRE HOC board of Directors.

2.  Receivership

Since it is quite clear that the bogus bylaws that the Sher/Shaw HOC board have followed for two years (which differ greatly from the real bylaws, serve the interests of Sher and his closest supporters, and contradict state law) are illegal, there are serious concerns about whether or not the current HOC board can be trusted to operate any longer.  That said, pending the judge's final order, a receiver will be appointed to manage Cedar Run.

The only question that leaves is......what authority (if any) should the current HOC have, in light of the above concerns?  This item is probably the central point of the court hearing today (12/29). **UPDATE - CONTINUED TO 1/8/2015**

3.  Financial Audits
With the legitimacy of the board questionable at best, concerns have also arisen regarding their handling of homeowner funds.  Co-mingling HOC funds with phase funds, back-door payments to employees/homeowners who don't want to report their income, board members forgiven on their assessment payments, delinquent owners allowed to 'work off' their assessment debt, shoddy bookkeeping, improper reporting of taxable vs. non-taxable revenue, fraud risks associated with the direct handling of assessment payments.......this list can go on forever, but these are just a few concerns that could be uncovered by a thorough audit.

Keep in mind that while Robert Sher was extremely critical of the previous HOC board for performing a annual  'Compilation Report' (a less rigorous financial review)  in lieu of a full audit, Sher's board has done NOTHING in terms of having a certified, independent party review the financial records and write up its findings.

4.  Order Restricting Board Activity
While the details of this order will be inextricably linked to above issues (i.e. receivership), The Judge made it fairly clear on 12/22 that the current board will not be allowed to represent itself as speaking on behalf of the association.  That means no more propaganda mailings or notices posted on garage doors that claim to be from the HOC, 'Master board', 'Oversight Committee'.  Pending a final order, it will likely be the receiver who will have exclusive authority to speak for the HOC.  What is clear (again pending a final order) is that Robert Sher and Jack Shaw will no longer be paid with Cedar Run homeowner funds!!

5.  Nobody Losing Their Home
In recognizing that there were many Cedar Run homeowners in the courtroom, Judge Garcia actually allowed a brief Q & A to clear up any confusion that homeowners may have about the court proceedings.  One homeowner asked the judge to directly address the assertion by the Sher group that our properties could be 'at risk' (presumably lost) as a result of the court's decision.  The Judge stated that the issue being decided will NOT result in anyone's home being taken from them.
(see transcript page 29, line 20 through page 30, line 9 AND Page 31, line 12-18)

6.  Caryn Shaw's Objection to This Blog
In response to comments made by opposing counsel about the Sher group's spread of misinformation (like signs telling Spanish speakers that their home is at risk), Ms. Shaw accused the authors of this blog of also spreading misinformation.  She accused us of misrepresenting the Judge Garcia's orders.  She was referring specifically to our blog post from 12/9, where we announced his decision regarding the election.

Caryn Shaw argued that we incorrectly stated that Judge Garcia had ordered an election when he hadn't.  She was partly right on this account:  Our initial blog post did state that an election had been ordered.  However, within a few hours time, we had corrected it to say that the Judge had thrown out the HOC's motion to dismiss them from an election order.  The Judge responded to Caryn's complaint by saying that although he hadn't ordered an election at that point, he had made it clear that he will order one as soon as other details are finalized.

Caryn also contended that we inaccurately stated that a T.R.O. (Temporary Restraining Order) was in place.  While we did initially say this (again corrected within hours), there was 'Stand Still' order in place, which although technically not a T.R.O., basically had the same effect as one.  The Judge dismissed this as a matter of semantics/jargon

In fact, the judge was much more concerned with the misinformation and scare tactics practiced by the Sher/Shaw group (such as telling unit owners that their homes are it risk) than he was about any of Caryn Shaw's objections to the blog content.

(see transcript page 30, line 14 through page 31, line 11 for the full conversation)

Judge Garcia alluded to blogs like this one as an avenue for people to exercise free speech and he noted that they are "encouraged, because they provide more information." (see transcript page 17, line 10 through page 18, line 10)

Closing Remark.....
We'll conclude this long-winded summary with one more response to something Caryn Shaw said in court.  After apologizing for a few of her misstatements and reminding the judge that she is a new attorney, Caryn wanted to make a point of saying that her and her family truly care about the people of Cedar Run. We'll leave that one for the homeowners to decide, but we'd like to point to the example she gave to support that statement.

Caryn Shaw stated that her sister, Anne Shaw, had worked for NO FEE (aka FREE) when she represented the Sher group in the summer of 2012 during their hostile takeover of the Cedar Run Board.  Caryn claimed that her sister's motivation was to help the unit owners of Cedar Run, and that's why she worked for no fee. (see transcript page 34, line 2-9)

Now take a look at the following check images for 'Legal Services from May through September [of 2012]' totaling $33,255.81.



NO FEE, YOU SAY???



Please stay tuned for details on the 12/29 hearing.  **UPDATE - CONTINUED TO 1/8/2015** We'd love to hear from you with any questions or feedback.
restoreCR@gmail.com
VM/Text (224) 544-9058



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Monday, December 22, 2014

Court Hearing Today

Apologies for the delay in updating the blog. It was an active day in court today.

A more complete summary will be posted in the next day or two, but here is the short version:

While no orders were actually entered, the conversation between the judge and the attorneys did spell out a few things that will likely pan out in the next week or so.

Again, to be clear, nothing was ordered by Judge Garcia today, but the attorneys for both sides will be negotiating the conditions upon which Cedar Run will be governed until the election, which will most likely occur in May of 2015.

The May election date is not etched in stone, but it appears to be agreed upon pending the resolution of other items. What is also fairly clear at this point is that there will be a receiver assigned to take a certain amount of responsibility/authority from the board and/or Oversight Committee.  How much authority has yet to be determined, and will likely be debated by the attorneys and presented to the court at the next appearance.

We will conclude this summary by saying that we are glad to hear that this very blog was mentioned at the court hearing today, and we are proud of the notoriety. We would like to thank Ms. Caryn Shaw for giving us the feedback that proves that this blog HAS made a difference in refuting the misinformation being spread by the Sher/Shaw group.

Stay tuned!