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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15 comments:

  1. Thank you for helping keep us inform....I know it has not been a easy job... But I want to let everyone know involved that all their hard work is deeply appreciated!

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  2. I also would like to say thank you to everyone who was involved. . Hopefully this has been a good lesson for everyone to see how we need to pay attention to what goes on in Cedar Run. We need to work together and take responsibility , or this horrible mess could happen again.Wow did this group take us for a lot of money!

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  3. Thank you for your hard work and keeping us informed of this unfortunate situation. We do need to work together to make sure this mistake will not happen again. Thanks again.

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  4. Thank you for all your time, effort, and money spent to get us this far.

    Once the forensic accountants go over the "books" will we finally be able to prove criminal wrongdoing so we can recover our misspent funds, and our own court/legal costs? Additionally, will this allow those personally attacked, harassed, libelled, arrested, or sued by Sher to seek redress?

    Will there be sanctions against the Sher family lawyers by the state or Bar Association?

    What is the status of our neighbourhood housekeeping going forward in regards to grounds, maintenance, and parking? I know there has already been some pot-hole patching done. The trees need arborists, the streets and courts are in need of repairs.

    Again thanks to all of you behind the scenes. Once this is resolved I think that there needs to be news coverage to prevent this happening to other associations, and bring to light his activities in his private business, as well as those who might consider voting for his family members in both public and private elections

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    Replies
    1. Chanteuse,

      Thanks for your comment.

      We have no idea what will be uncovered by the auditors, but we have been reassured that their findings will be available to all homeowners. We don't want to make any assumptions or accusations about criminal wrongdoing at this point because we don't have the evidence to prove it.

      What we can say is that Robert Sher, under the guidance of Jack Shaw, is very well aware of the differences between civil laws and criminal laws. They know that they can blatantly disobey civil laws, and you can only be held accountable if someone sues and wins a judgement against them. They also know how to make that process very difficult and frustrating for the plaintiff in such cases.

      The receivership and audit cannot really repair the damage that Sher has done to many of our friends and neighbors. They can only shed light on the information Sher his kept secret from us during his tenure. This alone my provide some redemption for many who have been wronged.

      Day-by-day maintenance will be administered by the receiver, but long-term or larger capital expenditures like street repairs will likely be addressed after a new board is elected. The receiver's goal is to get us OUT of receivership as soon as possible, not to make our long-term decisions for us.

      If Cedar Run homeowners can now band together, put the past behind us, and collaborate for the greater good of our collective future, we can ensure that the crisis we've experienced over the past few years is NEVER repeated.

      Delete
  5. Excellent Comments YES? a Big'' THANK YOU'' ,Enless Hours ,Time ,Patience FIGHTING FOR TRUTH &JUSTICE , we need to get rid of the bad weeds and let the flowers grow again .

    ReplyDelete
  6. Thanks for all the comments and feedback. These last few months have been very active and eventful for Cedar Run, thus requiring some overtime to keep the blog up to date.

    That said, it is definitely worth the extra effort to know that homeowners are being informed and especially that they appreciate the effort.

    We are also proud to know that this blog has played an important role in bringing forth change that will hopefully make Cedar Run shine brighter than ever!

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  7. ATTENION...Are you awhere Sher has H.O.C Web Site to make Assesments to a Chicago P.O.Box address? I suggest you look at whats posted on internet !

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    Replies
    1. We are completely aware, and the receiver is also aware of the payment instructions on that website. The court order gives the receiver the power to administer that website. They either have not gotten to it yet or they haven't gotten enough cooperation from Sher to give them proper access.

      Keep in mind that if a payment is sent to the chicago address, it will still count. The receiver has access to that account as well.

      All that said, we want to see that site taken down soon because it contains misinformation that could lead someone to believe that the Sher group is still in power. It also still has the bogus, illegal bylaws posted and claims that they are our true governing documents.

      Delete
  8. Why is the website still up? if there is a order against the Sher group that gives them no authority....Also...I have some neighbors that do not like that they need to send their assessment to a California address.. even if it is OK by the court....why not their Illinois address,?

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    Replies
    1. The only individual with the authority to shut down the website is the receiver. We can only speculate as to why it hasn't been done by now. We have contacted them to remind them that the site is still up and that it contains a great deal of untrue information that contradicts the receiver and court order.

      If they haven't gotten any cooperation from the Sher group in terms of turning over administrative access to the website, they will certainly report that to the judge at the next court appearance of 3/10/2015.

      it is understandable that the California payment address would be frustrating for homeowners. Among other concerns, we must drop our payments in the mail a few days earlier to ensure they arrive on-time.

      If you send us an email at restoreCR@gmail.com, we will gladly give you the name and contact info for someone at HHSG (the receiver) that can discuss these issues with you and possibly give you more definitive answers than we can.

      Thanks again for reading and for commenting.

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  9. Since 2011 to march of 2015 don't forget the units that went into forecloser or short sale that were purchased and I am can bet ?SHER AND SHAW bought these units with our cedar run assessment money &collecting rent !!! I suggest the units that were bought since 2011 be looked into and be able to prove that they were purchased out side of cedar run that no connection was made with assessment money we the home owners demand that every rock be turned over and criminal charges against'' SHER&SHAW is this receiver awhere of the ''F'' rating with the BBB ? THANX

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    Replies
    1. You can rest assured that the receiver and the auditors are fully aware of Sher's/Shaw's reputation, both inside Cedar Run and inside and outside Cedar Run.

      If any assessment moneys were used to purchase units, it would stand out like a sore thumb in both the financial and public records, and the auditors would definitely catch it. It's hard to believe that even Sher would do anything that blatant.

      What's more likely is that Sher/Shaw could have used their inside connection to Cedar Run to to help their real estate clients purchase units in Cedar Run. Jack Shaw is a real estate broker/agent, so he could earn himself a healthy commission on a purchase and give his client an advantage over other buyers. We do also know that some buyers have used Anne Shaw as their real estate attorney. It's highly doubtful that a random buyer would select her without having some type of connection to Sher/Shaw. And by the way, none of this would show up in an audit.

      We will all have to wait patiently for the results of this audit. for now, we can only speculate about what will be discovered.

      Delete
  10. •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.
    Did everyone receive a letter from Robert Sher? Isn't this violating the above? Cannot contact homeowners in any kind of official way or is this not considered an official way?

    ReplyDelete
    Replies
    1. As you can see, he tries to dance around that requirement by saying that the letter is "issued by Robert Sher, not the HOC's Master board or oversight committee."

      However, he refers to the Cedar Run HOC official website, and he arguably shows his intent to disrupt and discredit the receiver and possibly defy the court order.

      The receiver will be in court on Tuesday 3/10 to provide a status update. This letter may be presented to the judge then. Please read the latest blog entry and stay tuned for any new info.

      Thanks for the comment.

      Delete