All Things Enforcement: Board Basics (Part 2) on Rules and Enforcement

All Things Enforcement:

Follow Up to June 27, 2024 Board Basics (Part 2) webinar on Rules and Enforcement

Authors

Susan M. Hawks McClintic, Esq. CCAL Rhonda R. Goldblatt, Esq.

 

Continue reading All Things Enforcement: Board Basics (Part 2) on Rules and Enforcement

Pickleball and Associations

 

By Joe Sammartino, Esq.

 

Pickleball is one of the fastest growing sports in the United States. It offers a plethora of benefits and adds significant value to associations, in the ways described in this article. By introducing pickleball, associations can enhance the quality of life for their residents, foster community spirit, and boost property values. The sport’s accessibility, social benefits, and health advantages make it an ideal addition to any residential community.

First and foremost, pickleball is highly accessible and inclusive. It combines elements of tennis, badminton, and ping-pong, and it is played on a smaller court with a lower net, making it less physically demanding than other racket sports. This accessibility allows individuals of all ages and fitness levels to participate, from children to seniors. The ease of learning the game ensures that new players can quickly pick up the basics and start enjoying themselves, which encourages widespread participation within the community. Additionally, the relatively low cost of equipment—primarily a paddle and a few balls—makes it an affordable option for all residents.

The social benefits of pickleball are substantial. The sport naturally lends itself to doubles play, promoting teamwork and interaction among players. By providing a shared interest and a gathering place, pickleball courts can help break down social barriers and foster new friendships among neighbors. Regularly scheduled games or tournaments can create a sense of tradition and camaraderie within the community, enhancing the overall social fabric. These interactions are particularly valuable in an association setting, where fostering a strong sense of community can lead to a more harmonious living environment.

Health benefits are another significant advantage of incorporating pickleball into a community. The game provides a full-body workout, improving cardiovascular health, coordination, balance, and agility. Regular physical activity is crucial for maintaining a healthy lifestyle, and pickleball offers an enjoyable way to achieve this. For older adults, in particular, the sport provides a low-impact exercise option that can help improve mobility and reduce the risk of chronic diseases. The social nature of the game also contributes to mental well-being, reducing stress and promoting a positive outlook.

From an economic perspective, the installation of pickleball courts can enhance property values within the community. Prospective homeowners often look for amenities that support an active and engaging lifestyle, and the presence of pickleball courts can be a significant selling point. Well-maintained recreational facilities reflect positively on the community, suggesting that the association is invested in providing a high quality of life for its residents. This perception can make properties more attractive to potential buyers, thereby increasing demand and property values.

Furthermore, pickleball can serve as a versatile amenity in community event planning. Association boards can organize clinics, leagues, and tournaments, providing structured opportunities for residents to engage with the sport. These events can attract participation from various demographic groups within the community, promoting inclusivity and ensuring that everyone feels welcome to join in the fun.

 

The Arguments Against Pickleball

On the other hand, while pickleball has gained popularity for its accessibility and social benefits, there are reasons some people argue it should be banned from community associations, primarily due to noise and other nuisance related complaints. Some of those reasons may be compelling.

The primary issue with pickleball in communities is the noise generated during play. The distinct “pop” sound of the ball hitting the paddle can be surprisingly loud and persistent to some residents. Given that pickleball games often last 60-90 minutes and are usually played as doubles, the noise can become a disruption to some. Residents living near pickleball courts often report disturbances, especially when games are played early in the morning or late into the evening. It is reasonable to argue that such noise disturbances may lead to stress, interrupted sleep, and a general decline in the quality of life for nearby residents.

Additionally, the noise nuisance can exacerbate tensions within a community. Disputes over pickleball noise can lead to conflicts between resident players and non-players, fostering division rather than unity. The very presence of pickleball courts can become a contentious issue at association meetings, consuming valuable time and resources that could be better spent addressing other community concerns.

Moreover, the nuisance extends beyond noise. Increased traffic and parking congestion around pickleball courts can disrupt the normal flow of the community. The solution to all of these problems is thoughtful rule-making with lots of input from the community. Enacting reasonable, concise operating rules, including putting in place limits on hours of play, types of paddles allowed to be used, and guest use of courts can significantly (and at no cost to the association) eliminate most potential issues or concerns.

 

Conclusion

In conclusion, the incorporation of pickleball by an association into a community offers numerous benefits that enhance the overall living experience for residents. Its accessibility and affordability make it an inclusive sport suitable for all ages, while its social and health benefits contribute to a stronger, healthier community. Economically, the presence of pickleball courts can boost property values and attract prospective homeowners. By fostering community spirit and providing a versatile recreational amenity, pickleball may prove to be a valuable addition to a community, promoting a vibrant, active, and cohesive living environment. While some boards may be tempted to ban pickleball outright, all of the benefits discussed above may certainly outweigh the potential for complaints regarding the noise nuisances pickleball allegedly creates.

The decision about whether or not to permit pickleball is not a one size fits all solution and should be considered by each board on a community-by-community basis. To avoid as many issues and complaints as possible, and rather than banning pickleball completely, boards should perform a reasonable inquiry into the benefits and possible detriments of adding pickleball to their communities. To perform such an inquiry, a board should consult with its management team, legal counsel, and other relevant experts to determine whether permitting pickleball is within the best interest of the association. If the board determines that pickleball is a worthwhile investment for their association, the association should follow an open, input-driven rule-making process to help ensure that pickleball play remains in harmony with the community. If the board decides that pickleball should not be allowed in the community, the board should work closely with legal counsel on the implementation of its ban.

The Importance of Having All the Facts at the Outset of Representing a Client in Litigation

 

By Joe Sammartino, Esq.

 

In the intricate and high-stakes world of litigation, thorough preparation is a cornerstone of effective legal representation. Central to this preparation is the necessity of gathering absolutely all the facts about a situation at the outset. This comprehensive understanding is crucial for several reasons: it informs the development of a robust legal strategy, ensures ethical conduct, enhances the credibility of the attorney, and ultimately increases the likelihood of a successful outcome for the client.

 

Developing a Robust Legal Strategy

A well-informed legal strategy is built on a foundation of complete and accurate facts. At the outset of representing a client, obtaining all necessary information allows an attorney to assess the strengths and weaknesses of the case comprehensively. To initiate the fact-finding process in a new case, the client must promptly share with the attorney all of the facts about the dispute, regardless of how old, indirectly related, or seemingly insignificant those facts may be. When in doubt err on the side of overinclusion, and let your attorney determine whether a fact is or is not relevant.

This initial fact-finding phase is essential for identifying the key legal issues, potential defenses, and the most compelling arguments to present. It enables the attorney to foresee possible challenges or weaknesses of the case and to plan accordingly, avoiding certain pitfalls that could arise from unforeseen evidence or aspects of the case.

Moreover, a detailed understanding of the facts aids in the effective allocation of resources to litigate the case. It helps the legal team decide where to focus investigative efforts, which expert witnesses to consult, and what evidence needs to be meticulously scrutinized or gathered. By having a clear picture from the beginning, an attorney can work more efficiently and strategically, ensuring that no critical detail is overlooked.

 

Ensuring Ethical Conduct

Ethical considerations are paramount in legal practice. An attorney is ethically bound to represent their client zealously while also maintaining integrity and honesty. Having all the facts of the case at the outset ensures that the attorney can provide candid advice to the client, outlining both the strengths and weaknesses of the case. This transparency is vital for managing the client’s expectations and for making informed decisions about whether to pursue litigation, negotiate a settlement, or explore alternative dispute resolution methods.

Additionally, complete knowledge of the facts prevents ethical breaches such as the inadvertent presentation of false or misleading information to the court. It also safeguards the attorney against potential conflicts of interest and ensures the attorney’s compliance with the duty of candor towards the tribunal.

 

Enhancing Credibility

An attorney’s credibility is a critical asset in litigation. Judges and juries are more likely to be persuaded by an attorney who demonstrates thorough knowledge of the case and presents well-substantiated arguments. Complete mastery of the facts at the outset allows the attorney to argue more confidently and persuasively. It also minimizes the risk of being caught off-guard by opposing counsel, which could undermine the attorney’s credibility and, by extension, the client’s position.

When an attorney is well-prepared and knowledgeable, it fosters trust not only with the court but with the client as well. Clients are more likely to have confidence in their legal representation when they see that their attorney has a deep understanding of their case and is prepared to advocate effectively on their behalf.

 

Increasing Likelihood of a Successful Outcome

Ultimately, the goal of litigation is to achieve a favorable outcome for the client. Having all the facts at the outset significantly enhances the chances of success. It allows the attorney to craft a coherent and compelling narrative, anticipate and counter opposing arguments, and present evidence in the most favorable light. Comprehensive preparation reduces the likelihood of surprises during the litigation process, such as unexpected testimony or newly discovered evidence that could adversely affect the case.

 

Conclusion

The importance of having all the facts at the outset of representing a client in litigation cannot be overstated. It is fundamental to developing a sound legal strategy, ensuring ethical conduct, enhancing the attorney’s credibility, and increasing the likelihood of a successful outcome. Thorough fact-finding at the beginning of a case sets the stage for effective advocacy and is a hallmark of professional and competent legal representation.

10 Things Community Association Boards Are Doing Right

 

By Pejman D. Kharrazian, Esq.

 

 

Community associations play a crucial role in maintaining and enhancing the quality of life within residential communities. In California, where community associations are prevalent, boards are implementing innovative and effective strategies to ensure their neighborhoods thrive.  Here are the top ten things community association boards are doing right:

  1. Promoting Sustainability

Many community association boards are prioritizing eco-friendly initiatives. This includes installing solar panels on common area buildings, installing electric vehicle charging stations, promoting water conservation through drought-resistant landscaping, and encouraging recycling and composting programs. These efforts help the environment and also reduce costs.

  1. Enhancing Communication

Effective communication is key to a well-functioning community. Good communication helps build trust and fosters a sense of community. But remember that some things can not be shared with the membership, such as private, confidential, or privileged information! Leveraging technology and digital tools can also enhance communications.

  1. Fostering Community Engagement

To create a vibrant and cohesive community, many community association boards organize regular social events, such as block parties, holiday celebrations, and community clean-up days. These activities provide residents with opportunities to connect with their neighbors and build relationships. Engagement also helps recruit volunteers, such as committee members, and create a volunteer pipline and succession plan for engaging future volunteer board members.

  1. Promoting Emergency Preparedness

Community association boards are developing comprehensive emergency preparedness plans, including drills, community workshops, and the distribution of emergency supply kits to residents, ensuring the community is ready for natural disasters like wildfires and earthquakes.

  1. Maintaining Property Values

Many boards are proactive in ensuring that common areas, landscaping, and facilities are well-maintained. Regular upkeep enhances the aesthetic appeal of the community and helps maintain property values. This includes having a reserve funding plan, and making difficult decisions about raising assessments or levying special assessments when necessary.

  1. Implementing Fair and Reasonable Policies

Boards are striving to create and enforce fair and reasonable policies. They work to ensure rules and regulations are clearly communicated and consistently applied, avoiding favoritism or arbitrary decisions, which helps maintain harmony and reduce conflicts in the community.

  1. Focusing on Inclusivity

Recognizing the diverse population of California, many community association boards are making efforts to be inclusive and considerate of all residents. This includes accommodating different cultural practices, ensuring accessibility for individuals with disabilities, and fostering an environment where everyone feels welcome and respected.

  1. Seeking the Advice of Professionals

Boards face a myriad of challenges, from legal compliance to financial management, and community relations. To navigate these complexities effectively, it is crucial for boards to seek professional guidance. Leveraging this expertise ensures the success and stability of the community. And doing so helps satisfy the due care requirement of the Business Judgment Rule (found in California Corporations Code section 7231) that provides certain legal protections to a board’s decisions.

  1. Embracing and Utilizing Technology

Community association boards are adopting software for managing community operations, from handling maintenance requests to managing payments. These digital solutions streamline processes, improve efficiency, and enhance the overall management of the community. Boards are partnering with their management companies, who are developing tailored technology solutions that fit the needs of community associations.

  1. Providing Education and Resources

Well-informed boards and residents make for a better community. Many boards promote educational resources and training. This includes board workshops and seminars as well as classes on topics like home maintenance and emergency preparedness for owners. Educated residents are more likely to comply with community guidelines and participate actively in the community. Two well know organizations that have educational opportunities and resources for owners are the Community Association Institute (CAI) and Educational Community for HOA Homeowners (ECHO). The California Association of Community Managers (CACM) also provides educational resources. Finally, Epsten, APC offers a wide variety of training opportunities to community managers and directors, contact us for more information.

I’d Like to Submit a Complaint. . .

 

By Jacquelyn Quinn, Esq.

 

One of the most important roles of a community association board is enforcement of its association’s governing documents, including CC&Rs, Bylaws, and Rules and Regulations. One way a board may become aware of alleged violations of the governing documents is through owner-submitted complaints. In some communities, reviewing owner-submitted complaints can be a full-time job and boards are often left wondering whether they have to address each and every complaint that is received.

Boards might decide to streamline this process by establishing an owner complaint process, which details how an owner can submit an alleged violation and what information the board is expecting to accompany a submitted complaint. The following are a few items to consider including when creating an owner complaint process:

    1. Written complaints only. It can be very difficult for a board to respond to a complaint when it’s not in writing, so requiring that all complaints be in writing is helpful.
    2. No anonymous complaints. A board can make reasonable efforts to keep the identity of a complaining owner concealed, but anonymity cannot be guaranteed if an owner requests the board to act.
    3. Details, details, details. Specify what information is expected to be included in the written complaint (i.e. the description of the alleged violation, the section of the CC&Rs or rules that owner alleges was violated, the name (if known), the address of alleged violator, the approximate date and time of the alleged violation, a photo of the alleged violation (if appropriate), names of any witness (if applicable), and any other information the complainant deems relevant for the board’s review).
    4. Next Steps. Specify that the board has the right to elect to not take action on any complaint if, in the board’s sole discretion, there is insufficient evidence of a violation or it is determined that there has been no actionable conduct.
    5. Follow up. Include that the complaining owner will not receive a follow up from the board about any action taken. Owner discipline is a confidential matter that other owners do not have a right to receive information about. A complaining owner may want to know what action the board took in response to their complaint, but they do not have a right to that information. If the board reveals such information, the association may find itself in hot water.

Having a comprehensive complaint process is beneficial as it helps manage expectations. The association’s expectations for owners regarding what information is expected when they submit a complaint, and an owner’s expectations about how their complaints will be handled. Such a process can also minimize the number of meritless complaints a board receives when complainants are required to identify this type information, and sometimes make them realize that the behavior they observed may not actually be prohibited. If you wish to discuss such a policy for your association please consult with your association’s management company and legal counsel.

The Increasingly Complex Board Election Process

By Karyn A. Larko, Esq.


** This article was published on CACM’s The Law Journal– Summer 2024 Issue.


The Davis-Stirling Common Interest Development Act (California Civil Code (“CC”) §§5100-5145) mandates the following board election process for incorporated and unincorporated associations. Failing to comply with this process can lead to owner challenges of the election results and litigation, which in turn can lead to the election being voided, the association paying the challenging owner’s attorney’s fees and court costs, and civil penalties of up to $500 for each violation of the law.

Step 1: Notify members of the nominating procedure

The first step in the election process is to notify the members, via general delivery, of the procedure and deadline for submitting nominations for board election. This notice must be given at least 30 days before the nomination deadline and 90 days before the election.

Step 2: Handle unqualified nominees

If persons who do not meet the association’s candidate qualifications are nominated, the board must offer these persons internal dispute resolution before disqualifying them. The purpose of this meeting is to allow these nominees to qualify or prove they are qualified to run.

Step 3: Appoint/hire inspectors of elections

The board must appoint or hire one or three independent parties to oversee the election (“inspectors”). Inspectors can be association members who are not board members, candidates, or family members of board members or candidates. They can also be professional inspectors or other professionals, provided they, the entity they work for, and any parent entity are not performing any other compensable services for the association.

Step 4: Notify members of the election; create candidate and voter lists

At least 30 days before the ballot mailing, the association must notify members of the following via general delivery:

1) The date and time ballots must be received by mail or handed to the inspector(s);

2) The mailing address for returning ballots;

3) The date, time, and location of the election; and

4) The list of all qualified candidates who will appear on the ballot.

For associations that require a quorum to conduct elections, this notice must also include a statement that the board may call a subsequent meeting at least 20 days after the election date if a quorum is not reached. At that time the quorum will be 20% of the members unless the governing documents provide for a lower quorum.

At least 30 days before the ballots are mailed, the association must also prepare voter and candidate lists. The voter list must contain the name, voting power, address of the separate interest or parcel number, and mailing address for the ballot (if different) for all members. The candidate list must contain the names and addresses of all candidates.

Members are allowed to verify the accuracy of their information on these lists. The inspector(s) must correct errors on these lists within two business days of receiving notice of the mistakes.

Step 5: Ballot mailing

At least 30 days before the voting deadline, a ballot, two balloting envelopes, and the election rules must be delivered to all members. If the election rules are posted on the association’s website, the election rules can be omitted if the ballot includes the following statement in at least 12-point type “The rules governing this election may be found here:___.”

An association can but is not required to include candidate statements in the ballot mailing (unless the bylaws or election rules mandate their inclusion).

Step 6: The election

If a quorum is established, the inspector of elections must open ballots in public at a noticed meeting, and members must be permitted to witness the opening and counting of the votes.

If a quorum is required but not achieved at this meeting, the association may adjourn the meeting to a date at least 20 days after the adjourned meeting, at which time the quorum will be 20% of the members under CC §5115(d)(2). To take this action, the association must notify members via general delivery, at least 15 days prior to the reconvened meeting, of the date, time, and location of the meeting; the names of the candidates; that 20% of the members present, or voting by ballot or proxy (if permitted), will constitute a quorum, and that ballots will be counted if a quorum is reached.

Associations with adjourned quorum requirements lower than 20% should refer to their governing documents for any requirements.

Step 7: Announce election results

The election results must be recorded in the minutes of the next board meeting and provided to the members via general delivery within 15 days of the election.

ELECTION BY ACCLAMATION

If an association meets the requirements of CC §5103 and wants to elect board members by acclamation, the required election process changes in the following ways:

• The notice of the nominating procedure must be provided to members via individual notice at least 90 days before the nominating deadline. It must include the number of positions to be elected, the procedure and deadline for nominations, and a statement that if, at the close of the nominating period, the number of qualified candidates is the same or less than the positions to be filled, the board may elect the candidates by acclamation without a member vote.

• A reminder notice must be provided to members via individual delivery between seven and 30 days before the nomination deadline. This notice must include the same information as the original notice and a list of the names of all qualified candidates as of the notice date.

• Within seven business days of receiving a nomination, the association must send a written or electronic acknowledgment of the nomination to the submitter, and a written or electronic communication to the nominee confirming whether the nominee is qualified to be a candidate. These notices can be combined when a member nominates themself.

• The board votes to seat the candidates at an open session Board meeting. The agenda for this meeting must include the names of all qualified candidates who will be seated by acclamation.

PRACTICE TIPS

  • Include the candidate qualifications in the notice of nominating procedures to reduce the likelihood of unqualified persons being nominated.
  • Send out the notice of nominating procedures more than 90 days before the election so you have time to conduct IDR before the notice of the election and the names of the candidates must be provided to the members.
  • Remember the inspector(s) determine where the ballots are returned and kept until the election. This location can be the association’s management office, but only if the inspector(s) authorizes it.
  • While notices required as part of the election process can generally be provided to members by “general delivery” as defined by CC §4045, the association must provide these notices by “individual delivery” to any members who request individual delivery.
  • Check the bylaws and election rules to determine whether proxies are permitted and, if so, consult with the association’s legal counsel to ensure compliance with any requirements about the use of proxies.
  • Remember that the election rules are required and cannot be amended within 90 days of an election.
  • Provide equal access to the common area, without a charge, to members who want to campaign for or against candidates. If the association allows any candidate or member to use any association media, such as a newsletter or website, to campaign, all members must be given the same opportunity to use that media for campaign purposes.
  • If the association’s bylaws or election rules allow nominations from the floor at the annual meeting or write-in candidates, check with the association’s legal counsel before the election for guidance on what to do if someone who does not meet the qualifications to run for board election is nominated from the floor or as a write-in candidate.
  • It is just as important that the ballot mailing contains all of the information required by California law as it is that the association follows the mandated election process. Please consult with the association’s legal counsel if you are unsure what information must be provided.

 

Diversity, Equity and Inclusion in Community Associations

By Susan M. Hawks McClintic, Esq., CCAL

DEI is a term you might be hearing and reading about in the news lately.  DEI stands for diversity, equity and inclusion.  DEI is tied to civil rights laws and preventing discrimination in employment and housing based on someone’s characteristics.  In California, the characteristics protected by law include:

Race, color, ancestry, national origin, citizenship, immigration status, primary language, religion, disability (mental or physical), sex and gender, sexual orientation, gender identity or expression, genetic information, age, familial status, source of income, medical condition, marital status, military or veteran status, or citizenship.

At its core, DEI is about providing equal housing opportunities without harassment or discrimination based on these characteristics.

In California housing, including community associations, harassment of someone because of these protected characteristics is prohibited by the law.  Harassment includes verbal, written, or physical conduct that belittles or shows hostility toward an individual on the basis of these characteristics.  If a community association receives allegations of behavior that might constitute harassment the association is obligated to investigate and address any behavior which may be unlawful to the extent the association has the authority to do so in its governing documents.  The behavior may be subtle, rather than overt, and may be an accumulation of seemingly small events that result in someone feeling unwelcome in the community.

If any incidents between community members, residents and guests are reported to the community association, they may not specifically refer to harassment or discrimination.  The person reporting an incident or incidents may not use those specific terms or even be aware they might have harassment or discrimination claims.  Whether the report raises those concerns or not, the association should be aware of the potential for harassment or discrimination to be the basis for the behavior described in the allegations.

When the association receives a claim of an incident between community members, residents and/or guests, the board should determine whether the alleged behavior, if true, is behavior that might violate the association’s governing documents and/or which may be unlawful harassment or discrimination.  If there is insufficient information to make this determination, more investigation may be needed to attempt to verify what occurred and to evaluate whether any enforcement action against the alleged offender is needed.

It is understandable that if faced with allegations of harassment, board members may not feel qualified to investigate and determine whether a neighbor’s alleged harassing conduct was based on discriminationatory factors.  Remember that in many cases, the board may not need to definitively determine whether the alleged conduct was based on discriminatory behavior.  Harassing behavior can be a violation of the governing documents regardless of the reasons for the behavior.

Any investigation should be fair and impartial and appropriate in scope to the allegations made.  This process is similar to any other investigation of violations of the governing documents but the subject matter is likely to be more sensitive and personal than other types of potential violation investigations.  The board and management need to be sensitive to the nature of the complaint and in some situations may want to bring in a third party to perform the investigation particularly if the allegations are made against a board member or manager.

If the allegations are made against a board member or manager, that person should not be part of the group investigating the allegations or be involved in making any decisions as a result of the investigation.  The association’s investigation should be as fair and impartial as possible and, in some situations may be best handled by a third party to try to avoid any claims of bias or favoritism in the investigation process.

At the conclusion of the investigation, the board or committee created by the board to investigate the reported incident(s) will determine what they believe occurred, whether what occurred violates the governing documents and whether to take any disciplinary action or other steps.   (Generally, any unlawful harassment based on the characteristics protected by the law will be a violation of the association’s governing documents.  This should be addressed by the association with its legal counsel.)

The association’s objective is to provide an environment free from harassment and discrimination.  It is important for community association leaders to be able to recognize when a situation might involve unlawful harassment and discrimination and understand the potential role of the community association when situations arise within the community association which may constitute unlawful harassment.  Community association leaders are not expected to be experts in identifying and evaluating unlawful harassment but rather to be aware of circumstances where investigation and expert assistance may be needed.

“May I Buy This Home?” No Duty Owed to Prospective Purchasers

By Emily Long, Esq.

We are often asked by board members or management about an association’s obligation to answer questions posed by prospective purchasers, or to disclose certain documents, upon receipt of an escrow demand. Understandably, association representatives wish to promptly comply with an escrow demand within the time period required by law.[1]  However, it is important to keep a few things in mind when responding to these requests.

Current owners/prospective sellers are obligated to provide prospective purchasers with certain specified documents related to an association before they transfer title to a separate interest.  Civil Code section 4525(a)(1)-(10) lists the documents to be provided to a prospective purchaser by an owner and includes in the list: a copy of all association governing documents, along with nine other groups of documents. These specified documents are often termed “escrow disclosures.” Upon written request, the current owner of a separate interest must provide copies of the specified documents to the prospective purchaser “as soon as practicable” before the transfer of title or the execution of a real property sales contract pursuant to Civil Code section 4525(a).

Note that it is the current owner, not the association, that has the obligation to provide the specified documents under Civil Code section 4525 to the prospective purchaser.

However, common interest developments do not always get off quite so easily when it comes to an escrow demand. Associations are obligated to be part of the escrow disclosure process, by way of Civil Code section 4530. Civil Code section 4530(a)(1) provides:

“an association shall, within 10 days of receipt of a written request, provide the owner of a separate interest, or any recipient authorized by the owner, with a copy of all the documents requested as stated under Civil Code section 4525.”

As such, associations are required to provide a copy of the specified documents to the current owner or their designated recipient (who is often an escrow agent), within 10 days of receiving a written request. Again, notice that there is no obligation under law for an association to provide the requested documents to the prospective purchaser or the prospective purchaser’s representative.

It is important that association representatives are aware of these obligations and do not stray by providing more than what is required in Civil Code sections 4525 and 4530. Also, association representatives should be wary of interacting directly with prospective purchasers or prospective purchasers’ agents or representatives during the escrow disclosure process rather than the current owners/prospective sellers. For example, we are aware that sometimes prospective purchasers will ask associations to interpret existing restrictions in their CC&Rs or other governing documents (e.g., age restrictions or short-term rental restrictions). Questions like, “Is my son age-qualified to reside with me in the community?” or “May I short-term rent my home if I purchase in your community?” are not uncommon.

While an association representative’s instinct may be to answer such questions, we advise our clients to stick to the requirements of the law and only provide copies of the governing documents or other specified document, without analyzing the prospective purchaser’s situation. Remember: the association owes no duty to a prospective purchaser, only to the current owner of a separate interest within the association. Further, the disclosure duties of an association are limited to providing copies of lawfully requested documents as stated in Civil Code sections 4525 and 4530 to a current owner or owner’s designated recipient.

To do otherwise, could possibly subject an association to liability for unlawful interference with a contract to sell real property from the prospective purchaser or seller, in the unfortunate event that the sale of the separate interest goes bad. When an association representative is asked to interpret or explain any portion of an association’s governing documents by a prospective purchaser or even a current owner, the representative should provide a copy of the governing documents (or other specified document listed in Civil Code section 4525) and encourage the prospective purchaser or current owner to consult with their own qualified representatives if they have questions about the meaning of the governing documents.


[1] This article relates only to questions of prospective purchasers and not lender questionnaires.  Associations may also be required under the law to respond to lender questionnaires, in certain instances, but this topic is not covered in this article.

Virtual Board and Member Meetings

By Jillian Wright, Esq.

Good news for directors and managers who hold virtual meetings but hate the hassles that come with hybrid meetings: you can legally hold solely virtual meetings! Read on for details.

Associations have been using virtual video communications platforms like Zoom, GoTo Meetings, and Microsoft Teams for the last few years to hold board and member meetings. This was borne out of necessity as a result of the stay away orders of the COVID-19 pandemic. Boards continued to hold virtual meetings after the pandemic finding them convenient and efficient; more people – members, board directors, management, and vendors – are able to attend board meetings and at a lesser cost to the associations.

However, until recently, unless there was a local, state, or federal state of emergency, Civil Code required that an association still provide a physical location for the board meeting to allow members or board directors to physically attend the meeting if they desired to do so (Civil Code section 4090(b)). This led to hybrid meetings where boards held meetings both virtually and at a physical location. While convenient for some, it complicated matters for others as it required enhanced audio visual equipment to allow those attending virtually to hear the members attending in person and increased costs for management’s presence in person or venue rentals.

Now, as of January 1, 2024, Civil Code section 4926 allows boards to hold board meetings (and members to hold member meetings) solely by “teleconference”, without a physical location, provided a few conditions are met. Namely, associations planning to hold solely virtual meetings must give specific notifications to members; ensure director votes are cast clearly by roll call vote; allow members to attend by telephone; and protect members’ and directors’ statutory rights to participate.

Notification Requirements

Associations holding solely virtual meetings must provide notices of the meeting (given in accordance with Civil Code section 4920) which include:

    1. Clear technical instructions on how to participate by teleconference;
    2. The telephone number and e-mail address of a person who can provide technical assistance with the teleconference process, both before and during the meeting; and
    3. A reminder that a member may request individual delivery of meeting notices, with instructions how to do so.

Board Roll Call Vote

To ensure the record is clear, Civil Code section 4926 requires that any vote of directors be conducted by roll call vote (Civ. Code section 4926(a)(3)). This means each director’s name should be stated either by the directors themselves or by the president or manager before they vote for, against, or abstain on a motion. Since the directors are required to vote using a roll call, each director’s vote should be noted in the minutes rather than just stating that a motion passed or failed.

Member Participation

Directors and members need to be given the chance to participate as they would at any meeting held in person (Civ. Code section 4926(a)(2)). This means that members need to be given the chance and capability to speak during the open homeowner forum. All present at the meeting – directors and members alike – need to be able to hear and be heard. However, we note that the board may opt to mute members during those portions of the meeting where the board is conducting board business and members are not permitted to interject.

Attendance by Telephone

Associations need to give members and directors the option to attend a board meeting by telephone (Civ. Code section 4926(a)(4)). This is usually already offered through the more common virtual meeting platforms. Associations should consider including instructions for muting and unmuting oneself while on telephone in the notice of the meeting. Managers may also want to make an announcement at the beginning of the meeting as to when it is appropriate to unmute oneself and how to do so to avoid those less technologically savvy members from complaining that they are not able to address the board during open homeowner forum.

Exception

Civil Code section 4926(b) clarifies that while some member meetings may be held solely virtually, those meetings at which ballots are counted and tabulated pursuant to Section 5120 may not be held exclusively by teleconference.

Conclusion

Holding meetings virtually has its advantages, but associations need to make sure they are conducting such meetings in accordance with the law to avoid members’ challenging the validity of actions taken at such meetings. If you have any questions about the requirements discussed in this article or in the Open Meetings Act generally, we recommend you consult with your legal counsel directly.

 

Mastering the Architectural Review Process

By Rhonda R. Goldblatt, Esq.

Reviewing architectural applications is typically part of a community association manager’s bread and butter. However, the architectural review process can be fraught with stumbling blocks, and architectural disputes with homeowners can be drawn-out, expensive affairs. A few practice tips for processing architectural applications are listed below to help master the architectural review process:

1. The clock is ticking. An association’s declaration typically includes a deadline to respond to architectural applications, and may even provide that failing to respond by the deadline deems an application approved. Associations can consider calendaring response deadlines to ensure an application is timely processed.

Note that if an association’s declaration does not include a response deadline, that does not mean the association has unlimited time to respond. Civil Code section 4765 states an association’s architectural approval procedure “shall provide for prompt deadlines. The procedure shall state the maximum time for response to an application or a request for reconsideration by the board.” If an association’s declaration is silent on deadlines, boards can consider adopting architectural rules with that information.

2. Get familiar with Civil Code section 4765. Section 4765 includes other important standards, including the requirement to respond to an application in writing, and providing a written explanation as to why an application was disapproved, along with a description of the appeal process. The law also requires associations to make decisions on an application in good faith, and prohibits making unreasonable, arbitrary or capricious decisions. Further, associations must provide the membership with annual notice of the architectural review process.

3. Pay attention to the special cases. The Civil Code includes special standards for certain proposed improvements, including solar energy systems, electric vehicle (“EV”) charging stations, EV-dedicated TOU meters, accessory dwelling units (“ADUs”), and junior ADUs. Remember that the law prevails over an association’s governing documents in the event of conflict. Boards may want to consider adopting separate policies for processing these types of special applications to ensure compliance with the law.

4. Know thy governing documents. Associations must follow their own procedures, and may face liability for failing to do so. Adopting clear, concise procedures in the first place can help associations stay on the right side of the law. Boards can also consider asking their community association counsel for help drafting those procedures, and/or reviewing the procedures on a regular basis to ensure consistency with the law.

5. Keep a written record. Maintaining well-organized records of architectural decisions can help protect an association from liability in the event of a homeowner challenge. Relying on memory alone can lead to trouble. The members of a board or architectural committee can change, key witnesses can move away, memories fade, and managers can switch accounts.

When in doubt as to how to process an architectural application, remember that you can always consult your friendly community association counsel for assistance.

** This article was published on San Diego Community Insider Magazine – Spring 2024 Edition.