Saturday, April 08, 2006

Coto de Caza Board of Directors Elections: Scam? Sham? Bam!

c.c.: James Harkins
c.c. Coto Discussion Forum
c.c. OC Register
c.c. LA Times
c.c. State and County Agencies.

This is to officially request that partially based on the information provided herein, you 1) invalidate ALL proxy statements for electing district delegates and 2) invalidate the 2006 CZ Master Association Elections and start from scratch:

Either by design, convenience, ignorance, negligence or incompetence or a number of other drivers, it does not take President Jimmy Carter to figure out that the irregularities witnessed so far in the 2006 CZ Master Association 2006 do not meet the spirit nor the law of the association CC&Rs or California Corporate Law:

Withholding and misleading Information – Although there are a number of tools available to the association - such as the association’s website, CotoVoice, the President’s Letter and the entrance message boards - to communicate with Coto residents the electoral process, it has failed miserably to do so and in fact the information advanced is misleading and used instead to promote personal agendas:

CC&Rs call for residents to elect district delegates based on a quorum formula. District delegates then elect the board of directors.

The board in a sign of arrogance, prematurely announced that cumulative voting would be used to select two new BOD members. Common sense follows that residents would be more interested in finding the right delegate, since once the delegate is elected, there is nothing else the resident can do – it is then up to the delegate to elect the board.

However, ALL the focus has been placed on promoting board candidates, and every effort has been made to keep residents in the dark with regards to delegates and the process used to elect them. As the Keystone, - the property general manager assigned to the association- puts it “it is up to the resident to request delegate qualification” – This is presenting a solution without figuring out what the problem is in the first place, then because the residents do not know what they do not know, they never ask the question!

The delegates are supposed to be the ones with the community context and the ones who have a pulse on their districts. They are the ones who know the problems and the ones who are in the best position to select the right board candidate that can address such problems – not the average resident! – at least that is how corporate law and CC&Rs have structured this form of local governance!

· The current website in the What is New Page (, features community activities in great detail and a link to the board candidates’ bio – NO information about district delegate candidates – see figures 1 and 2.

· The March and April 2006 issues of CotoVoice have the Easter Egg Hunt in the front page and board candidate bios somewhere in the body – NO information about the election process or district delegates. The President’s Letter contains the same information as is found in CotoVoice.

· The entrance announcement boards feature the Easter Egg Hunt – candidate elections were never mentioned.

What is the message being sent by the association to the residents? Forget about the district delegates, we already know who they are going to be, and they are the ones who are going to elect us the two Candidates we want:: Thagard and Zipperman!

In other words, assume we have passengers, pilots and airplanes, where the airplanes are the board candidates, and the passengers are asked which plane they want their pilots to fly, without knowing if the pilot eventually selected can fly that airplane!

The outcome is predictable as indicated by the questions the dismal attendance present during the April 6, 2006 district delegate elections asked. No one knew what the process was, or what to expect. At that time the general manager mentioned that he personally had called residents asking them for proxies to meet quorum and for volunteers for district delegates.

Another example is the email message we received April 7, 2006:

How do we get our new delegate??
The whole thing is sooooo incredibly confusing.
We do NOT want our old delegate back!!

Other irregularities include the following:
1. The district delegate meeting was being run as a board meeting. In fact, the combination of Keystone employees and the board, as well as the projected new director, outnumbered the attendance and all of the motions were either moved or seconded by Varo/Mezger or Thagard! Additionally, Varo was barking instructions as what could, or could not be done! Surely not consistent with the spirit and/or letter of the CC&Rs!
2. The GM’s own admitted that Keystone has participated in the solicitation of proxies and candidates assuring the status quo. Consistent with the established pattern of behavior, Keystone management states “There seems to be a misunderstanding about who was called and why. In an effort to have delegates elected in every district, CJ asked our staff to call the existing delegates to encourage them to re-run. If the existing delegates did not intend to re-run, our staff encouraged the delegates to talk to their neighbors about possibly running”. This action, even in a banana republic is election tampering. Guess whom the existing delegates voted for? Guess whom the existing delegate neighbors are going to vote for? Do we need to bring in a Ph.D. to sort this out? During the meeting, the attendance was discouraged from using ballots and instead encouraged them to use proxies. Given that audit of previous elections found these were “validated” by a foreign entity and a non-homeowner, and “verbally” approved by legal counsel, this might elicit one or two questions about Keystone’s integrity and or competence!
3. Keystone/the board are proceeding with the existing proxies – not consistent with spirit and letter of CC&Rs!

Figure 1: Website What is New Page Retrieved from 04/08/2006

Figure 2: CotoVoice Cover April 2006

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