HomeMy WebLinkAboutThe case against DBV HOA _Redacted-3.pdf1
Kathya M. Firlik
From:
Sent:Friday, February 21, 2020 1:24 PM
To:Raymond Tao; Justin Jones; Victor Olivares; Esmeralda Magallanes
Subject:Essential background on Diamond Bar Village HOA and S & L Management
The case against
Diamond Bar Village HOA and
S & L Association Management
On Thursday, February 20, 2020, I visited the City of Diamond Bar and talked with both Esmeralda
Magallanes and Justin Jones, asking for help in dealing with people whom I consider to be con artists who
are stealing our money: Yvette Marie Allen and her bosses at S & L, John Sorah and Rosy Amlani, as well
as the current directors, Larry Carmack, Stephanie Allen-Herms, and Alice Liu.
Esmeralda Magallanes and Justin Jones were quite patient while I explained my two-year history of dealings
with Diamond Bar Village HOA Board of Directors and S & L Association Management. Justin urged me
to send an email to several people at the city (they are cc’d here) explaining those details. I hope that this
background will help enlist your help in deposing this leadership at DBV and preventing the wholesale
destruction of the property and value of DBV.
Summary
has owned condominiums in the Diamond Bar Village (DBV) Condominium
Complex and operated them as rental units since 1978. She currently owns two units. Since
and in fragile health, she has given me a broad power of attorney over the condominiums that
she owns. The condos are rentals, and constitute half of her income. They are important to her. They are
important to me, too, because I will inherit one of them.
WHEN WE FIRST SUSPECTED MALFEASANCE
began to suspect malfeasance in the HOA, and she enlisted my help with requesting
financials and other association records from the HOA.
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By law, the HOA must produce records for owners within 10 business days or 30 business days, depending
on the type of document requested.
However, it has now been over two years since the first requests were made, and we have
requested records 6 times, with each instance consisting of many different documents. To date,
only about 25% of the financials and records have been produced. No meaningful examination of
records can be done without complete financials and records.
I can send a more detailed explanation of these claims, including many exhibits of evidence.
Since the very beginning, the HOA has engaged in a series of delaying tactics designed to keep us from
seeing the documents, running up our attorney’s fees by sending our lawyers endless correspondence,
misquoting the law, making false accusations, and in so many ways trying to discourage us from pursuing
those records. We have consulted with two law firms, racking up over $7,000 in legal fees.
On May 24, 2018, after extensive correspondence with our lawyers and the payment of money for the
process of redaction, the HOA was finally forced to set up an in-person examination of records. However,
within 15 minutes, the HOA had shut down the examination for specious reasons and no records were
copied. More alarmingly, at that meeting, the property manager’s son (who works there as a maintenance
worker) falsely accused me of “putting [my] hands on” his mother. A week later, in an obvious attempt to
intimidate us from further pursuing documents, HOA counsel wrote that they were considering pursuing a
“workplace harassment lawsuit” against me because of what they called “assault and battery.” They
claimed to have videotaped the moment of the assault, but when that video was submitted in evidence in
Small Claims Court, the judge wrote that he “found its credibility lacking.”
After that bizarre incident, I was wary of confronting the defendants except in court. I spent the summer
studying the law, and in October, 2018, I filed a small-claims case to enforce our right to see association
records. In January, 2019, we appeared in court. We were warned by a lawyer who specializes in condo
law that judges often don’t understand condo law, and that turned out to be the case here. Despite the law
being clearly in our favor, Judge Pro-Tem Anthony Moreno Peters ruled against our right to see those
records.
However, I was not deterred, because legal experts and the law itself had told me that it was absolutely our
legal right to see those association records. I also knew that the HOA would not fight so hard to keep
those records secret if there were not something damning in them. Therefore, we immediately sent
another request to see the association records that had been generated since our previous request, namely,
records from March, 2018, to January, 2019.
On January 25, 2019, HOA sent a letter in response. The letter set an extreme hurdle to delivery of the
requested association records—namely, that I pay for the HOA’s lawyer to be present throughout the
inspection “in order to minimize further intimidation”—a demand that had no basis in law and which
would have amounted to at least $2,000+ hurdle, since the examination would have taken at least six hours
and lawyer’s fees are commonly $400 per hour and higher. As further justification for this financial hurdle,
HOA asserted erroneously in a March 28, 2019, letter that I “attempted to bring in additional individuals to
the [May 24, 2018] inspection who were not authorized….” The individual to which they refer is Yvonne
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Colaco, who was a board member at the time, and had an “absolute right” to see association records at any
time. The only alternative HOA offered was to deliver the records electronically via email. That alone
called into question the authenticity of the records.
In February, 2019, deadlines for producing association records were missed once again, and we sent an
email documenting that. On March 7 (in a letter back-dated to February 28, 2019), HOA delivered the
membership list, which we had been requesting for 14 months. In HOA’s cover letter, HOA reiterated
their desire to produce the records only electronically, once again citing their bogus accusations of violence
against me.
HOA finally delivered those association records on March 28, 2019. As might be expected, a large volume
of the records were not delivered, and conspicuously missing were the records that we most wanted to
see. In addition, the cover letter erroneously asserts that HOA was providing “hard copy records,” when
in fact only electronic records were delivered. HOA concludes by claiming that our “continuing demands
and claims concerning the records appear nothing more than harassment.”
I didn’t examine the records immediately because my mother went into the hospital around that time for a
couple weeks. She was in the hospital twice more before the end of the year. and I was busy with my own
business. However, by November, I had a chance to examine the documents, and what they did deliver
was astonishing. The records proved that S & L Association Management (Yvette Marie Allen, John
Sorah, and Rosy Amlani) were taking roughly $250,000 in management fees from Diamond Bar Village,
which is more than ten times the fair market rate for management of a complex of that size. However,
they were hiding it. HOA was paying $81,000 to S & L directly (about four times the fair market rate). In
addition, HOA was paying over $100,000 to Yvette Marie Allen to be a full-time on-site manager (she
comes in only 2 – 3 days per week). Furthermore, HOA was paying nearly $100,000 to her son, Marcus
Allen, who is working as a maintenance man, and not very well at that job, either. That represents an
overpayment of roughly $70,000, and must be considered a de facto payment to S & L.
In all, these payments add up to nearly $250,000 per year in monies being paid to S & L.
DBV and S & L assert that they will need to levy a special assessment on the homeowners in order to pay
for repairs, but if you do the math, you can see that such an assessment is not necessary. All they have to
do is reduce the management fees to a reasonable rate of $15,000 per year and we will have $235,000 more
per year to spend on repairs.
Specific things that made us suspect malfeasance
, has been an owner since 1978, and several years ago, was elected to the DBV
HOA board of directors. As such, she has regularly attended HOA board meetings. However, in Fall,
2017, she became alarmed at the behaviors of the property manager and new HOA board members that
were strange and alarming. During one board meeting, she had a shouting match with Yvette Marie Allen
and had a stroke. She had to be carried from the meeting by another homeowner.
One new board member, Yvonne Colaco, also became suspicious. In fact, Ms. Colaco was so concerned
that she and I wrote a letter to the Los Angeles District Attorney outlining her suspicions of criminal
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activity. The letter that was sent in August, 2018. (The district attorney declined to pursue the
investigation because we had no documentary proof of theft, and without association records, which HOA
was unlawfully denying, we could provide no proof.)
However, Ms. Colaco’s letter is useful, since it clearly documents her concerns about suspicious behavior
on the part of DBV HOA and S & L Association Management.
This behavior included:
1. Exorbitant spending. In 2018, the property manager had discussed purchasing new patio
furniture for the complex, and was asking for an $8,000 budget. The pool is not much larger than a
standard backyard pool, and with that kind of money, the furniture would average out to about
$1,000 per chair. In addition, the most recent HOA records reveal that over $300,000 was spent on
grounds maintenance alone during the most recent nine months. This is an incredible figure for a
complex with 150 units, averaging out to $2,000 per year per unit.
2. Depletion of the reserve account. Over a roughly year-long period after Yvette Marie Allen
became property manager, the reserve account balance plummeted from $285,000 to only a little
over $2,000, which is basically nothing. This is an account that should be kept at responsible levels
in order to respond to an emergency, should it arise.
3. Not paying maintenance bills for 10 months. In 2017, Yvette Marie Allen stopped paying
the bills of the grounds maintenance company, Pro Tech, and only in November, 2017, did she
notify the board that they were $119,000 in arrears in payments to them, according to Ms. Colaco.
4. Preventing a board member from seeing financials/records. During Fall, 2017, and
stretching into the winter in 2018, Yvette Allen consistently denied board member Yvonne Colaco’s
requests to view financials and other association records. As mentioned earlier, they also denied
Colaco’s right as a director to be present for my examination of association records on May 24,
2018. This is a direct violation of Corporations Code 8334, which gives directors “the absolute right”
to inspect those records:
a. “Every director shall have the absolute right at any reasonable time to inspect and copy
all books, records and documents of every kind and to inspect the physical properties of the
corporation of which such person is a director.”
b. In fact, during one bizarre incident, Ms. Colaco entered the clubhouse in order to inspect
the pay of the maintenance men, one of which was her son, Marcus Allen. Ms. Allen
refused to talk with her, locked herself in her office, and turned the radio up to full volume
until Ms. Colaco left.
5. Denying Yvonne Colaco the right to run for the board again. Early in 2018, Ms. Colaco
submitted her application to run for the HOA board once again. However, when the ballots were
printed, Ms. Colaco was not on the ballot. She was told that she had missed the deadline when in
fact she hadn’t. Also, she was told that she could not be added to the ballot, even though the
ballots had not yet been sent
6. Owner intimidation. Yvette Allen, the property manager, is quite an aggressive and
intimidating presence in Diamond Bar Village, and has at times even threatened owners with
physical harm. Others have been threatened with frivolous lawsuits,
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. Ms. Colaco was also formally censured in order to stifle her dissent. As a result of this
intimidation, several owners have chosen to move off the property, including Ms. Colaco, who
moved early in 2019.
7. Denying owners the right to attend meetings. In January, 2018, the HOA board banned me
from meetings, despite the fact that I presented the board with a broad power of attorney. They
claimed that the law doesn’t allow people with power of attorney to attend board meetings, when in
fact, the law clearly states the attorneys are not allowed to attend board meetings. In order to fight
this judgement, I would have had to physically challenge them at the board meetings, which would
have invited violence, or take them to court, which would have cost lots of money. We decided to
pursue them in court only with regards to association records.
8. Asbestos remediation. In 2018, an owner reported to us a scheme that the management
company seemed to be engaged in designed to create damage in individual homes specifically so
that they could repair that damage and take a kickback from the contractor. The on-site manager,
Yvette Allen, talked and pushed her way into his home, examined the intact ceiling, brushed her
hand roughly against the ceiling, causing bits and pieces of it to fall to the carpet, and declared that
asbestos was now exposed. As a result, she said, it would have to be remediated. The owners were
required to move out of the unit for three weeks while the remediation took place. We suspect that
this was done in order to illegally take a kickback from the work.
9. The management company was making all decisions. Since the moment they took over,
Yvette Allen of S & L Association Management has been making all the decisions and regularly
hiding details from the board, especially Yvonne Colaco. Even when Ms. Colaco asked to see
details, Ms. Allen has refused to divulge those details to Ms. Colaco.
10. Creating a slush fund. During the period that we were suspecting malfeasance, Ms. Colaco
reported to us that the HOA board was increasing the amount of petty cash to be allowed on hand
for the management company from $300 to $5,000. We were eager to look at the financial details
of this arrangement, but since the association records were always being denied to us, we were
never able to look into it.
The above bizarre behavior, as well as numerous other suspicious behaviors on the part of Ms. Allen and
the HOA board, convinced me that the HOA might be committing malfeasance.
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