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Residential developments often create a general scheme of restrictions, operate common facilities, and establish an owners association to enforce the restrictions and operate the common areas. Private governments raise difficult public policy and legal issues. Private regimes should generally be enforced as they encourage the efficient use of land, allow choice in living arrangements, and foster participatory democracy. At the same time, though, the restrictions can offend personal autonomy, create inefficiencies, and permit undue control by past generations over present owners. The law should therefore enforce homeowners association covenants that prevent harmful fallout on the neighborhood, but they should not uphold the few covenants that offend the personal autonomy of the current owner. Moreover, the law should require that community associations treat owners equally, employ fair procedures, and refrain from making irrational decisions.

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