Wednesday, March 25, 2015

Cedar Run Legal Update - Special Hearing Today

At the last court hearing on March 10th, the receiver presented his first report to Judge Garcia.  There were a myriad of issues that the receiver had already discovered after only 3 weeks of managing Cedar Run. We will provide a more detailed summary of them later.

Receiver's report can be found HERE
A transcript of the 3/10/15 hearing can be found HERE.

Two issues that stood out to the Judge specifically involved Robert Sher's actions and his failure to obey the Judge's orders.

  • The letter that Sher sent to all Cedar Run unit owners
    • The letter proclaimed that Sher would have lowered the assessment fee to $65
    • It also encouraged homeowners to take action before the May elections

  • The receiver's comment that Sher was obstructing their efforts to access HOC expense records
    • These records were stored online with Robert Sher controlling access.
    • Sher first restricted access, then eventually removed them.

The Judge was very displeased  after learning of the above actions by Sher. In response to this, he issued a "rule to show cause" against Robert Sher, with a hearing date of 3/25/15 at 2PM.  The purpose of this hearing is to determine if Robert Sher did directly violate the Judge's orders (T.R.O. and stand-still order).  And if so, what the "remedy" (presumably punishment, penalty, or restriction) will be for such violations.


    We will update the blog with any new information we learn from today's hearing. Feel free to subscribe to this blog (see below), and you will get updates right in your inbox.

    ***UPDATE*** 
    Robert Sher in contempt of court!  See comments section.
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    Please stay tuned!!

    restoreCR@gmail.com
    (224) 544-9058



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    Wednesday, March 11, 2015

    Cedar Run Legal Update - Receiver's Report Now Available

    Attention Cedar Run homeowners,  We now have of a copy of the report presented by the receiver in court yesterday (3/10/15).

    The report can be found by clicking HERE.

    There is a lot of interesting material in this report.  It shows what a real mess Sher had left at the time of his ouster.  It also shows that he may be hiding certain financial information from the receiver and accountants.  (item 17)


    We will post a thorough summary later, but for now we'd like to point out some issues that Phase V owners should know prior to tonight's meeting at the clubhouse.
    • Phase V financial and legal documents have been kept secret from the phase directors since the Sher takeover (item 8)
    • Phase V has not filed tax returns since the Sher takeover (item 8)
    • Phase V has no Director's & Officer's (aka D&O) insurance policy, meaning that if the board members were sued, they would have to pay for their own defense (item 11-b)
    • Phase V's building insurance only covers $66 per square foot, when it should cover about $200 per square foot (item 11-c)
    • The way Phase V's insurance policy is written, it may NOT COVER ANYTHING on the residential buildings and only cover the clubhouse (?!)  (item 11-e)
    If you are urged to support re-hiring Sher/Shaw to manage your phase, consider these facts carefully.

    We strongly encourage all homeowners in Phase V to attend this meeting. Given the above information, we believe that the directors who called this meeting, are probably making a good-faith effort to inform homeowners.

    If this is the case, then we applaud them for making this effort.


    Please stay tuned for our full summary of the receiver's report.  For the time being, we encourage you to read it in its entirety.  We will also post the court transcripts once they are available.




    Tuesday, March 10, 2015

    Cedar Run (Partial) Legal Update

    As you are aware, Al Schroeder (the HOC receiver) had appeared in court today and presented his first report to Judge Garcia.  We are still collecting information about the proceedings, which we will post as soon as possible

    What we do know is this:
    • Attorney Robert Orman (who defended Sher, Shaw and the HOC board from December to present) has withdrawn as their attorney.  We do not know the reason why, but we suspect that Mr. Orman either wasn't paid or feels that Sher's case is futile.
    • Sher is STILL TRYING to argue that his Bogus Bylaws are legal, but the Judge won't have any of it - MOTION DENIED
    • In regards to Robert Sher's recent letter to homeowners, the Judge was not happy about it, and a court date of 3/25/15 has been set in order to discuss possible SANCTIONS AGAINST HIM for disobeying both the TRO (Temporary Restraining Order) and the original standstill order.
    We will have more information, including a copy of the receiver's report within the next day or two.


    But for now, We interrupt our regularly scheduled program to bring you some news about Cedar Run Phase V.

    Cedar Run Phase V homeowners received an 'Emergency Meeting' notice tacked to their garage today (3/10/15).  Click HERE to view the notice.

    It is not clear what the Phase V board's exact motives are in calling this meeting.  However, we recommend that all Phase V homeowners attend the meeting if possible or call the listed phone number to inquire.

    History
    To briefly recap, Phase V was taken over by a group led by Sher, in a way that is legally questionable at best.  Most believe that this takeover was outright illegal, and they blame A.P.M. for yielding control of the phase to Sher.

    Once Sher assumed control over this phase, he appointed three figurehead directors, who would serve as nothing more than names on paperwork that delegated all authority to Sher and Shaw (the oversight committee).

    Since then, Sher and Shaw have had full control over the Phase V association's money.  In an effort to keep assessments from rising,  Sher had grossly under-insured Phase V, and many suspect that he also subsidized the phase with HOC funds.

    There have been NO ELECTIONS, NO BOARD MEETINGS, and NO BUDGETS for Phase V since the takeover.

    Now that the HOC is in receivership and the oversight committee is powerless, the documents signed by the figurehead directors no longer authorize Sher/Shaw to manage the phase.  The Phase must now hire a licensed property manager.

    Improper Notice
    For any kind of official Phase meeting to take place legally, the Condo Act requires a minimum of 5 days notice to all owners, and notice must be mailed or hand-delivered to each owner.  This notice was taped to garage doors literally ONE DAY before the meeting date......Also, off-site owners have no way to know about this meeting since notice was never mailed to them.

    Given that the meeting was improperly noticed, any vote that may take place (as the notice implies) will be invalid.

    What to expect
    Again, we have no way of knowing what the board has planned for this meeting.  There is a good chance that this meeting is an attempt, on the board's part, to pander to Robert Sher's will and re-hire him as the Phase V property manager.

    But it could also be a genuine attempt for these directors to communicate with homeowners about what a conundrum they were left with after Sher's ouster.  After seeing how Sher's poor decisions affected the HOC, perhaps they have finally decided to seek other management options.

    Are these directors interested in the greater good for their association?   Or are they simply puppets of Robert Sher?

    We'll have to find out tomorrow evening. We recommend you keep an open mind, but think critically.

    What you might want to ask
    Ask for a budget and ask how much money the phase has in the bank
    Ask about the status of Phase V's building insurance
    Ask when the next Phase Board election will take place
    Ask why only one day of notice was given for this meeting. If they wanted it to be well-attended, why such short notice?

    Please check the blog tomorrow afternoon (or check your email if you subscribe), as we may have more court information that pertains to Phase V.

    Monday, March 9, 2015

    Cedar Run Legal Update - Receiver to Appear in Court

    Tomorrow (3/10/2015) at 10:30 AM, Al Schroeder from Heil, Heil, Smart & Golee  (i.e. the receiver) will be appearing before Judge Garcia.  There he will present his first report on how things have progressed since his firm has taken over the Cedar Run HOC.

    There may be some very interesting information in this first report, which Cedar Run homeowners will certainly want to see.

    Such information will likely include:
    • The receiver's observations and comments about the current state of the property
    • The level of cooperation from the outgoing HOC board and oversight comittee
    • Costs incurred thus far - from vendors/contractors and for the receiver's services
    • Status update on the collection of paperwork for the financial audits
    • Receiver's requests or recommendations to the Judge (if any)

    What we'd also hope to see in this report are:
    • Information on the receiver's plans regarding clubhouse personnel
    • Status of the HOC website, which still contains false information and conflicting payment instructions
    • Receiver's comments about the recent letter from Robert Sher


    We will post a copy of the receiver's report as soon as its available.  We are also very interested in the judges remarks after he's reviewed the report, and we will post a transcript of the proceedings as soon as one is available.

    Please stay tuned!!

    restoreCR@gmail.com
    (224) 544-9058



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    Thursday, March 5, 2015

    And So It Begins.....

    By now, Cedar Run homeowners have likely received a letter from Robert Sher.  This is the first correspondence we've received from him since the HOC went into receivership.  In case you haven't gotten yours yet, you can view it HERE.

    Robert Sher's desperation really shows through in this letter.  This letter is very reminiscent of the multitude of so-called "newsletters" that Sher has produced over the past two years.  According to this letter and the past newsletters:

    • Everything Sher has done has been perfect, despite all the odds stacked against him
    • Anything that has gone wrong is the fault of someone else (former board, banks, lawyers, Alma, etc.)
    • Anyone who would dare oppose Sher is demonized

    Major Points from the Letter:
    $65/month HOC assessment
    This is Robert's big attention-getting headline.  He claims that he would have reduced the HOC assessments (starting on January of 2015) from $125 to $65 per month if he hadn't removed from power.  Just as he was about to roll out this major reduction in assessments, the court stepped in and took away his authority to make it happen.

    Isn't it interesting that he would choose make this reduction starting in January 2015 when the fiscal year had begun in November of 2014?  Isn't it also strange that this is the first we are hearing of such a planned reduction?  Why wasn't he hyping this for months leading up to its effective date per his normal routine?

    Answer:  Because it's another LIE to try and paint Sher as the savior of Cedar Run.  Before taking power, Sher sent postcards to Cedar Run homeowners (see below) that claimed, with their vote, he would cut your entire assessment payment IN HALF while maintaining the same level of services.  Today, our assessments are higher than they were in 2012, and services have been at an all-time low.  Does anyone really believe this $65/mo claim given Sher's track record?



    Bylaws and Elections
    Sher fails to elaborate, but he claims that the Bogus 2012 Bylaws and his failure to conduct elections have nothing to do with his ouster.  Anyone who has read through the court order and read the judge's comments from the court transcripts would know that the Bogus Bylaws played a major role (arguably as much or more than the elections) in the judge's decision.  As for elections, the entire counter-suit that resulted in receivership NEVER would have happened if Sher had conducted elections as required by law.  He blatantly disobeyed state law and our true governing documents, which the Judge could clearly see.

    What is Sher's explanation of why Judge Garcia ruled the way he did? When can we see this explanation in writing?

    Website
    In the letter, Sher refers to a website to chronicle his successes.  Administration of this website, per the court order, must go to the receiver.  In addition to Sher's propaganda, this website contains conflicting payment information, and it STILL shows the Bogus Bylaws.  Is Sher not cooperating with the receiver and handing over the rights to control this website?

    It's All About Robert
    The letter is filled with statements like, "I created....savings." and "I reduced assessments".  This further reaffirms our point that Robert Sher ruled over the board and not the other way around.  For anything he touts as a success, he takes all the credit for himself.  Yet, while still in power, he sent out newsletters that contained personal attacks and racial rhetoric, and he signed these letters as being from, 'The Master Board'.  He did this despite multiple board members stating, at a meeting, that they did not approve of such rhetoric.

    A dictator, by an other name (like 'oversight committee chair'), is still a dictator.


    Conspicuous Omissions
    What's equally important is what Robert Sher didn't say in this letter when touting his accomplishments over the past two years.  First, he continues to dodge around the point that he and Jack Shaw were both paid a handsome salary.....at least $60K/year between the two of them.  It took a subpoena and several courageous homeowners handing out check images to get Sher to even acknowledge being on the payroll.  Sher continues to point to his efforts as purely humanitarian, when we can clearly see that he had a vested interest in maintaining his paid position.  He WAS being paid; now he is NOT; and he is hellbent on getting his job back.

    Second, Sher failed to mention all the lawsuits that were spurred by his foolish and impulsive decisions.  One of these lawsuits (Best Trees vs Cedar Run) is featured on an informational website about association living.  Click HERE for the story and click HERE for the official appeals court ruling. This is a NATIONAL website, and they chose Cedar Run (under Sher's leadership) as a case study on poor, costly, emotionally driven decisions.


    Bottom Line
    We knew Robert Sher would not go away quietly.  Despite his adamant proclamations that he has done everything legally and properly, he was removed from power for acting ILLEGALLY.  Yet, our disgraced and now powerless 'oversight committee chair' is desperately trying to claw his way back into power.

    Since the receiver has stepped in, things have been relatively uneventful and (dare we say) peaceful in Cedar Run.  While there are still several open issues that need the receiver's attention, homeowners appear to be content with how things are running in Cedar Run.  This is probably Robert Sher's greatest fear.....that homeowners might be happier without him in power - that they might be happy enough with the current arrangement to consider keeping it that way (i.e. being professionally managed).  This is why he concocted the $65/month story - to try and convince homeowners that they are missing out on something great, that ONLY HE can deliver.

    It's getting ugly, folks.  It will probably get uglier before it's finally over.

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    Stay tuned for a future blog posts that will take an in-depth look at the claims and promises made by Sher and their subsequent results.


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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.


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    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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