Welcome Emily Long!

 

Please join us in welcoming Emily Long as an Associate Attorney in our Indian Wells office.

Emily obtained her J.D. from the University of Wisconsin Law School in 2008 and a B.A. with high honors in Sociology and Women’s Studies in May 2004. She is experienced in both litigation and transactional work and is excited to join the EG&H team!

Conflict Resolution

By Jon H. Epsten, Esq.

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It should come as no surprise to all of you that life in a community association (or working for one) is fraught with conflict of all types: “You’re playing favorites,” “You’re discriminating against me,” “My neighbor is irrational and he’s making my life a living hell and it’s the association’s job to fix it,” “I’m not paying the assessments until you do what I want you to do,” “Too late for architectural approval, I already finished construction!”

All too familiar. Unfortunately, it’s going to fall on board members and managers to resolve such conflicts. While some of these conflicts will end up in court, it’s wise and a proper discharge of the board’s business judgment and fiduciary obligation to consider how to resolve conflict within the community at the least social and economic cost. At a time in our country where the most basic civility is in short supply, there are pressures which exacerbate the conflict between associations and members, and between the members themselves. Most board members and managers aren’t schooled in how to defuse conflict (and too many attorneys are better at litigating conflicts than facilitating conflict resolution by other means).

Here are some helpful guidelines to remember about the basic nature of a ‘dispute’:

“It takes two to tango.”

For a conflict to really blossom into something ugly, it generally takes two egos, and mouths which operate better than ears. For conflict to be resolved, it’s going to take someone with a better ability to listen than to talk. Find a board member or manager who is a good listener and you’re halfway to resolving a dispute.

“Much conflict is sustained because no one wants to ‘admit weakness’.”

While volumes have been written about that, remember that ‘when you’re at the edge of a cliff, sometimes progress is a step backwards.’ It’s not weakness to search for some middle ground, and if it takes a good display of humility and an attempt to understand the other side of an argument, that’s time (and energy) well spent.

Compromise is not a dirty word.”

Consider that a lawsuit is going to cost just about as much as the other side wants to make it cost. With some basic guidelines (the board can’t give away common area, for example, nor can it afford to overlook egregious violations of architectural restrictions–but many disputes are about far less), with some willingness to compromise, and some imagination (“No, you can’t plant 60′ species which within 5 years will block your uphill neighbor’s view, but you can plant ___________”), there’s a compromise waiting to be found. Think outside that box!

“You can’t always get what you want;
You can’t always get what you want;
But, if you try sometimes,
You just might find,
You get what you need.”
– Mick Jagger and Keith Richards

Because so many community association disputes end up in court, the legislature has over the years created pre-litigation dispute resolution procedures, some of which (ADR) is actually required before most association cases are filed. A quick refresher on “ADR” and “IDR” follows.

IDR

“IDR,” or “internal dispute resolution,” is a relatively new type of dispute resolution. It is unique to the Davis-Stirling Act. Essentially the Act allows an owner to compel a sit-down meeting with a board member to discuss a dispute. If a written demand is made to the association, the association must meet with the owner, in a reasonable period of time, and at no cost to the owner. (Conversely, if the association would like to convene an IDR session with an owner, the owner is not required to participate.) The parties may agree to use the services of a mediator, but it is not required. It is important to note that the Act does not necessarily require the association (or the member) to ask for IDR before moving on to mediation or arbitration, though that is often the case. The Act anticipates that each association will adopt its own IDR procedure, but if the association does not do so, the Act specifies a default procedure (currently found in Civil Code section 5915).

Some observations:

IDR is not a confidential proceeding (unlike mediation). What is said in an IDR proceeding can be repeated in any subsequent lawsuit.

Consider carefully the best candidate to represent the association in an IDR proceeding. It’s not necessarily the president. In general, it’s the director who can listen to an angry homeowner without taking umbrage, while at the same time effectively putting forth the association’s concerns. (A FAQ is whether the board can attend in its entirety. While not absolutely clear from the statute, it’s not generally a good idea. We do like to see more than one person attend, avoiding the “one-on-one swearing contest” scenario. Often times, attorneys are definitely not welcome. An IDR is supposed to be a meeting between the member and a director, leave the mouthpieces–on both sides–out of it.)

Make sure you understand the dispute when a homeowner asks for IDR. The demand is required to be in writing. If the written demand isn’t clear, ask follow up questions before the IDR begins. This is important so that the board can decide how much discretion the director has.

Even though the association isn’t statutorily required to offer IDR before moving to the offer of ADR, it’s a good idea (unless there’s an emergency requiring some immediate court action). First of all, it makes the association look better if the matter later turns into litigation, and second, you just might get lucky, learn something, and avoid the lawsuit altogether. (It’s also free discovery.)

ADR

California law and tradition recognize three types of alternative dispute resolution (“ADR”): binding arbitration, nonbinding arbitration, and mediation. “Arbitration” is a quasi-judicial proceeding, wherein a person selected by the parties (usually) acts as a judge of a dispute, hearing evidence and argument, and making a ruling. At the end of the proceeding (unless the parties settle in the meantime), a decision will be made.

If the arbitration was a “binding arbitration,” the order may be filed with the court, and thereafter it will operate as a judgment. In general, there is no appeal from a binding arbitration order.

“Non-binding arbitration” is precisely that–non-binding. The arbitrator will make a ruling, but it does not bind either of the parties unless and until they agree to that.

“Mediation” is another form of ADR. It is not a quasi-judicial proceeding, but a facilitated negotiation. The mediator, who is chosen by the parties, has no authority to decide a dispute, only to assist the parties to the dispute in attempting to find some middle ground. If at the end of the mediation, the parties cannot agree, then everyone goes home.

For most disputes in a community association (that is, those involving a request for enforcement of the governing documents, the Davis-Stirling Act or the Corporations Code, as well as prior to recording a lien for unpaid assessments), the party anticipating filing a suit will be required to at least offer ADR to the other potential litigant before filing the suit. (Civ. Code §§ 5925, 5930, 5660)

There are exceptions:

If the suit involves damages in excess of the small claims court jurisdiction, the offer of ADR is not required.

If the suit involves a request for a TRO (temporary restraining order) or preliminary injunction, no pre-filing offer of litigation is required.

The Act provides that the offer of mediation shall be in writing, and the offer is to contain a brief description of the dispute between the parties, a request for ADR, a notice to the party receiving the offer that the respondent must reply within 30 days of receipt or the request will be deemed rejected, and if the person receiving the offer is a homeowner, the association must include a copy of the relevant Civil Code provisions (§§5925-5965.)

If the homeowner agrees to the mediation, the mediation is to be held within 90 days of the acceptance, unless the parties extend that time by written agreement. (Civ. Code §5940(a).)

If a party seeking to file an enforcement action fails to first offer ADR, the complaint may be stricken by the court or placed on hold (stayed) to allow ADR. And, if the party who wins an action has refused to participate in ADR, the court may reduce the amount of fees awarded to that party. (Civ. Code §5960.) While the Act provides that the parties to the ADR are to be “borne” by the parties (Civ. Code §5940(c)), one recent case awarded a homeowner his legal fees incurred during the mediation. Grossman v. Park Fort Washington (2012) 212 Cal.App.4th 1128.

Why we need conflict resolution that does not involve lawsuits:

In a word, lawsuits are often times inefficient and a costly way of resolving disputes, as even attorneys agree:

“Lawsuits consume time, and money, and rest, and friends.” – Sir Alan Patrick Herbert

“The courts of this country should not be the places where resolution of disputes begins. They should be the places where disputes end after alternative methods of resolving disputes have been considered and tried.” – Sandra Day O’Connor

And in the context of communities, lawsuits are not the vehicle of choice for dispute resolution for another very good reason: even if you win, you lose because of the residual mistrust and animosity spawned by the court proceedings.

Finally, there are the lingering problems posed by the money. Of course most lawsuits over the CC&Rs will result in an award of attorney’s fees to the prevailing party, but what happens when the loser cannot or will not pay those fees? Will the association pour more money down the drain, or consider settling instead for less than it “should” have received? It’s difficult to explain to the owners that the association won at the same time the board is imposing an assessment to cover the costs of the lawsuit which remain unpaid by the losing owner (not to mention the catastrophic prospect of a fee award which pales in comparison with the actual costs expended or — God forbid — the loss of a case which seemed a “sure thing” way back when the case started.

Do We Only Need a Member Vote to Borrow Money if the Governing Documents Say So?

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By Karyn A. Larko, Esq.

Borrowing is a common method for community associations to pay for major projects within their communities.  However, Boards frequently find the lending process a lot longer and more stressful than they first imagined – primarily because they do not realize until they are ready to close on the loan that they need member approval, and maybe even mortgage holder approval, to obtain a loan.

It is not uncommon for a community association’s Bylaws or CC&Rs to include a provision expressly providing that the approval of a specified percentage of the membership is required to borrow money.  However, the absence of such a provision in these documents does not necessarily mean that the Board has the authority to take this action on its own.  In some cases, the Bylaws and CC&Rs are silent, but the Articles of Incorporation impose restrictions on borrowing.  In other cases, the Articles, Bylaws or CC&Rs  impose member and/or mortgage holder approval requirements on actions that are, or may be required to borrow money.  Examples of these actions include restrictions on the Board’s ability to unilaterally encumber common area, or pledge or assign other association assets.

One provision that is contained in the Bylaws or CC&Rs for many associations that is commonly overlooked when ascertaining the Board’s ability to borrow money is the provision requiring member approval for contracts exceeding one year.  Because a loan is a contract, a loan with a repayment term exceeding one year will generally be subject to this provision unless there is language in the governing documents that expressly exempts loans from this requirement. Remember also that any regular assessment increase or special assessment needed to repay the loan may also require a membership vote.

If your association requires assistance determining whether member or lender approval is required to borrow money, or assistance obtaining the required approval, please contact us.

Epsten Grinnell & Howell, APC promotes Dea C. Franck, Esq. to Shareholder

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Jon H. Epsten, Esq., Susan Hawks McClintic, Esq. and the Shareholders of Epsten Grinnell & Howell, APC are pleased to announce the promotion of Dea C. Franck, Esq. to Shareholder, effective July 1, 2019.

Dea joined the firm in July of 2013, and her contributions to the firm and leadership in our Indian Wells office are unprecedented. In the six years since Dea has been a part of our team, she has maintained and established numerous key relationships and clients throughout the Coachella Valley and is well-known throughout the community association industry. Dea plays an active role in producing the firm’s annual Community Association Law Resource Book, speaks at the firm’s annual Legal Symposia and has developed and taught countless educational programs for community association board members and managers.

As a member of the Coachella Valley Chapter of the Community Associations Institute since 2015 and currently a member of the Chapter’s Board of Directors, Dea is an Educated Business Partner and has received many awards for her commitment to the Chapter. During her free time, Dea is also on the Board of Directors for Animal Samaritans, an animal welfare organization in the Coachella Valley.

As a Shareholder, Dea will lead the firm’s Indian Wells office, with plans for continued growth in the Coachella Valley, while providing the quality legal services for which our firm is known.

EMILY A. LONG, Esq.

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EMILY A. LONG

EMILY A. LONG

Attorney at Law

Practice Areas

Community Association Counsel
Civil Litigation






Education

University of Wisconsin-Madison, 2004
University of Wisconsin Law School, 2008

Affiliations and Memberships

State Bar of California
State Bar of Wisconsin
Community Associations Institute (CAI)
California Association of Community Managers (CACM)

Overview

Emily Long recently joined Epsten Grinnell & Howell, APC, in the summer of 2019. Prior to her work at Epsten, she worked in the realm of estate planning, as well as trust and estate litigation and administration in Palm Desert, CA. Emily began her legal career as an attorney in Milwaukee, WI, where she worked for a small law firm that built the capacity of nonprofit community development corporations dedicated to economic revitalization work. However, in 2011, she moved to California in search of a warmer climate.

Emily is a proud graduate of public schools and universities from which she has received a Bachelor of Arts Degree with high honors in Sociology and Women’s Studies from University of Wisconsin-Madison, and a Juris Doctorate degree from the University of Wisconsin Law School. While attending law school, Emily was a Senior Articles Editor of the Wisconsin Journal of Law, Gender and Society and specialized in community economic development law. She also won honors including the State of Wisconsin’s Public Interest Law Student of the Year, the Dane County Pro-Bono Law Student of the Year, and clerked for the Honorable Patrick J. Fiedler, Judge, Dane County Circuit Court.

Events & Speaking Engagements

Emily enjoys spending time with her family when she is not working, which include her husband and three children. Emily also loves to cook, listen to music and travel. As to be expected, she is a serious Packer, Badger and Brewers fan.







JACKIE E. QUINN, Esq.

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JACKIE E. QUINN

JACKIE E. QUINN

Attorney at Law

Practice Areas

Community Association Counsel





Education

University of California, Davis, 2008
Boston Univeristy School of Law, 2016

Affiliations and Memberships

State Bar of California
Community Associations Institute (CAI)
California Association of Community Managers (CACM)
San Diego County Bar Association
Lawyers Club of San Diego

Overview

Jackie earned her Juris Doctor from Boston University School of Law. While attending law school she served as a judicial extern for the Honorable Joan M. Lewis, California Superior Court. Jackie also served as an Appellate Advocacy Director for Boston University, and competed as a member of the National Appellate Advocacy Moot Court team. Prior to law school, Jackie attended University of California, Davis, where she earned her Bachelor of Arts degree in Psychology and Human Development.

Events & Speaking Engagements

Dec
6
Fri
Epsten Grinnell & Howell, APC San Diego Legal Symposium @ Town & Country Hotel
Dec 6 @ 7:30 am – 3:30 am

Our Annual Legal Symposium offers comprehensive legal information for our clients, community association boards and community association managers. This is an exclusive opportunity to meet with our team and hear our attorneys provide updates and insight on case law and legislative changes and trends.

 

 

 

We invite you to join hundreds of your colleagues for a complimentary day of:

  • Exhibitor networking
  • Legislative and case law updates
  • Attorney Q&A and round tables
  • Best practices and hot topics specific to community associations 

Refreshments will be provided with breakfast and lunch.

This event is pending CACM-approval for 2 CEUs and is pending approval for 5 CMCA credits by the Community Association Managers International Certification Board (CAMICB). www.camicb.org

In her free time, Jackie enjoys spending time with her family, traveling and working out.

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Q&A. I am a director on my community association’s board, but I am not a “volunteer” director under the language of Civil Code section 5800 because I own three homes in our community. Does that mean I could be personally liable for a portion of the damages if the association is sued and loses the lawsuit?

A: Potentially, yes, but that does not mean you do not have insurance coverage. Civil Code section 5800 provides that volunteer directors of residential or mixed use associations will not be personally liable for damages in excess of the association’s insurance coverage so long as the volunteer director’s action(s) were performed in good faith, within the scope of their duties, and not willful, wanton or grossly negligent, and their association maintained the minimum levels of general liability and directors and officers insurance as provided in section 5800.  Section 5800 does not apply to “non-volunteer directors”, i.e., a director who is either (1) the declarant, (2) an employee of the declarant, (3) an employee of a financial institution that purchased a separate interest in the community via foreclosure, or (4) the owner of three (3) or more residences within a residential community.   Consequently, non-volunteer directors may have personal exposure.  Non-volunteer directors should contact their insurance agent to make sure that they have both types and amounts of insurance coverage (either personally or through their employer, if they are declarant employee or the employee of a financial institution as described above) to protect them.  The association’s insurance agent should also be consulted to confirm that the association’s insurance policies meet at least the minimum coverage requirements of section 5800 and that non-volunteer directors are covered by the association’s insurance policies.  – Dea C. Franck, Esq.

Q&A. Must we have a published fine schedule if we notify owners in the hearing notice what fine the board intends to impose at the hearing?

A: Yes. California Civil Code section 5850 requires associations that want to use fines as a means of disciplinary action for violations of the governing documents to prepare and distribute a fine schedule. Additionally, section 5850 limits associations to imposing fines that comply with their published fine schedules. In other words, if an association’s fine schedule provides for a $100 fine for a given governing document violation, the association’s board cannot impose a $150 fine for that violation. The hearing notice should include the possible fine amount(s) but this doesn’t replace the need for a fine schedule.
On a related note, please remember that boards need to follow the rule adoption process mandated by Civil Code section 4360 when adopting a fine schedule. This means that the proposed fine schedule must be sent to all members for at least a 28-day comment period before being adopted at a duly noticed open session board meeting. The purpose and intended effect of the fine schedule must also be provided. Finally, notice of the board’s decision to adopt the fine schedule must be provided to the members within 15 days of the board meeting whereat the fine schedule was adopted. – Karyn A. Larko, Esq.

Q&A. There is a director on our board that is sharing information from executive session with other owners that are not on the board. What do we do?

A: Initially, sharing such confidential information may qualify as a breach of the director’s fiduciary duty, subjecting that director to personal liability. Often a letter from association’s legal counsel reminding the director of his/her fiduciary duty can have an impact on the director’s future behavior. If you have recently restated your bylaws, they may provide that under such circumstances the board has the ability to remove the director from the board without a member vote. If you do not have this option, the board may be able to remove the violating director from a position as an officer (as president, secretary, etc.) if the individual is an officer and the bylaws allow for such removal. While removing a director from an officer position does not remove the director from the board, it does make a statement that the person may not serve in a position of greater responsibility.
The board may also censure the director. A censure is a statement of reprimand, criticism, and/or disapproval of a director. Again, while this will not remove the director from the board, it often acts as a strong reminder to the director that the board takes such matters seriously. If the board has adequate evidence that the director has indeed shared executive session information and the risk of the director continuing to share such information is great, the board could form an executive committee consisting of two or more directors (other than the director at issue) to address certain executive session subjects. If such a committee is formed, it should be set forth in a detailed written resolution outlining the purpose of the committee, the reason why it is being formed, and the scope of authority of the committee. – Carrie M. Timko, Esq.

Q&A. Can an association be responsible for damage to owner-maintained driveways and walkways caused by tree roots located on the owner’s lot but maintained by the association as part of its common maintenance responsibilities?

A: The association may be liable for damage caused to an owner’s property by the roots of the tree under a theory of negligence. However, the association would not normally be liable under a claim of negligence unless it was on notice that the tree roots were causing damage and thereafter the association failed to timely remedy the problem. Negligence occurs when an association, through its board of directors, knows or should know there is a risk of property damage and fails to take reasonable action to prevent such damage. To prevail on a negligence claim, the owner would have to prove the tree roots caused damage to his or her property and the association was negligent in maintaining its roots. The relevant inquiry, therefore, is whether the association as acted reasonably in maintaining the trees and corresponding roots. An association that has landscaping responsibilities should consult a licensed landscape contractor and make regular inspections of the association maintained trees, and when appropriate consult with an arborist. If the association regularly adheres to the recommendations of its licensed landscape contractor and arborist with regard to maintenance and upkeep of the trees and roots it will be difficult to argue the association was negligent in its maintenance. – Jackie E. Quinn, Esq.