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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