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The Right to be Heard: A Timely Reminder of Civil Code Section 4515

Karyn A. Larko, Esq.

Senior Attorney 

858.527.0111
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Practices: Community Association Counsel 

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On January 1, 2023, amended California Civil Code section 4515 went into effect. The intent of section 4515 is to ensure that owners and residents of common interest developments can peacefully assemble within the community and freely communicate with others regarding matters related to the association and common interest development living, as well as other social, political, and educational purposes (“Matters of Public Interest”).

Specifically, section 4515 gives members and residents of an association the following rights:

        • The right to peacefully assemble or meet with other members, residents, and invitees or guests to discuss during reasonable hours and in a reasonable manner Matters of Public Interest, including matters relating to common interest development living, association elections, legislation, election to public office, or the initiative, referendum, or recall processes;
        • The right to invite public officials, candidates for public office, and representatives of homeowner organizations to meet with members, residents, and their invitees or guests, and speak on Matters of Public Interest;
        • The right to use the common area, including any meeting room or clubhouse when available, or, with the consent of the owner, the owner’s lot or unit, for an assembly or meeting related to Matters of Public Interest. Of note, an association cannot require members and residents to pay a fee, make a deposit, obtain liability insurance, or pay the premium or deductible on the association’s insurance policy in exchange for being able to use the common area for the assemblies and meetings listed in items 1 through 3 of this article;
        • The right to canvass and petition the members, the residents and board members regarding Matters of Public Interest, at reasonable hours and in a reasonable manner;
        • The right to distribute or circulate, without association permission, information on Matters of Public Interest at reasonable hours and in a reasonable manner; and
        • The right to use social media or other online resources to discuss any Matters of Public Interest even if the content is critical of the association or its governance.

Civil Code section 4515 does not require an association to allow members and residents to display signs, posters, banners, or flags in the common area, or use the association’s website to express their opinions on Matters of Public Interest. Nor does this law require an association to provide members and residents with social media or other online platforms where they can express their opinions on Matters of Public Interest.

It is important to note that if an association’s governing documents attempt to prohibit members and residents from exercising their rights under Civil Code section 4515, or if an association otherwise attempts to hinder members and residents from exercising these rights, the association could face liability, including a civil penalty of up to $500 for each violation.

 

PRACTICE TIPS:

        • Establish a system for reserving the clubhouse, meeting room or other areas suitable for meetings, and keep track of when these areas are reserved so you can promptly respond to requests to use these areas.
        • If the association generally requires members and residents to pay a fee, pay a deposit or obtain liability insurance to reserve the use of common area, include on the reservation form an area for the reserving party to identify the planned use of the common area, so you know whether these requirements must be waived.
        • Never retaliate against a member or resident for exercising their rights under Civil Code section 4515, even if they were unfairly critical of the board or management.

 

 

New Year, New HOA Resolutions!

Jon H. Epsten, Esq., CCAL

Shareholder

858.527.0111
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Practices: Community Association Counsel | Construction & Remediation | Construction Defect Litigation | Civil Litigation | Commercial CID

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Kickstart the year with new goals and planning for a successful community management.

At our annual firm Legal Symposium, I was asked by a board member “what they could do differently in 2025 to make their life as a board member just a little easier?” So, I decided to place the answer to her question in the form of New Year’s resolutions. Get started early in the year with these Resolutions and hopefully 2025 will be a better year for both you and your association.

 

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Updates on The Corporate Transparency Act as of 12/27/2024

 

*This article is an update to the previous versions:

FIFTH CIRCUIT COURT OF APPEALS REINSTATES NATIONWIDE PRELIMINARY INJUNCTION OF THE CORPORATE TRANSPARENCY ACT

On December 26, 2024, the full panel of the Fifth Circuit Court of Appeals (“Fifth Circuit”) vacated the December 23, 2024 decision by a three judge panel to stay the preliminary nationwide injunction against the Corporate Transparency Act (“Act”) created by the December 3, 2024 ruling in Texas Top Cop Shop, Inc., et al. v. Garland, et al.  The Fifth Circuit Court of Appeals court order can be read here. Please note this order simply reinstates the initial preliminary injunction and is still not a final ruling on the Act’s constitutionality.

At present, the Fifth Circuit’s order means the reporting requirements for applicable community associations are currently “on hold” and applicable community associations are not currently required to meet the January deadlines for filing.

The Fifth Circuit is expediting the government’s appeal and additional developments are imminent.  Our office will continue to provide updates as they arise.  However, community association boards should continue to closely monitor the developments and remain prepared to meet applicable filing deadlines if the filing requirements are reinstated.

For additional information and updates on the Texas Top Cop Shop case appeal and its applicability to the Act visit www.caionline.org/CTA.

Updates on The Corporate Transparency Act as of 12/24/2024

 

 

By Kieran J. Purcell, Esq.

 

*This article is an update to the previous versions:

BOI REPORTING DEADLINE EXTENDED BY FINCEN

On December 23, 2024, the Fifth Circuit Court of Appeals granted a stay over the preliminary nationwide injunction against the Corporate Transparency Act (Act) created by the December 3, 2024 decision in Texas Top Cop Shop, Inc., et al. v. Garland, et al. The Fifth Circuit Court of Appeals also issued an order reinstating the January 1, 2025 beneficial ownership information (“BOI”) reporting deadline.

On December 24, 2024, the Financial Crimes Enforcement Network (FINCEN) extended reporting deadlines. Notably, FINCEN extended the reporting deadline for reporting companies created or registered to do business before January 1, 2024. These companies have until January 13, 2025, to file their initial BOI reports.

FINCEN also extended other BOI reporting deadlines. Information about these additional extensions can be found at https://www.fincen.gov/boi.

The Fifth Circuit Court of Appeals court order can be read here. Please note this order just stays the initial preliminary injunction and is still not a final ruling on the Act’s constitutionality. To that end, the Fifth Circuit’s order directed the appeal in this lawsuit be expedited to the next available oral argument panel.

CAI continues to track federal courts for challenges of the Act and is in contact with the United States Department of Treasury about the Act. For additional information and updates on the applicability to the Act visit www.caionline.org/CTA.

Updates on The Corporate Transparency Act as of 12/23/2024

 

 

By Kieran J. Purcell, Esq.

 

*This article is an update to the previous versions:

FIFTH CIRCUIT COURT OF APPEALS STAYS PRELIMINARY INJUNCTION OF THE CORPORATE TRANSPARENCY ACT

On December 23, 2024, the Fifth Circuit Court of Appeals granted a stay over the preliminary nationwide injunction against the Corporate Transparency Act (Act) created by the December 3, 2024 decision in Texas Top Cop Shop, Inc., et al. v. Garland, et al. The Fifth Circuit Court of Appeals also issued an order reinstating the January 1, 2025 beneficial ownership information (“BOI”) reporting deadline.

The Fifth Circuit Court of Appeals court order can be read here. Please note this order just stays the initial preliminary injunction and is still not a final ruling on the Act’s constitutionality. To that end, the Fifth Circuit’s order directed the appeal in this lawsuit be expedited to the next available oral argument panel.

At present, the Fifth Circuit’s order means all reporting companies created or registered to do business before January 1, 2024, have until January 1, 2025, to file their initial BOI reports.

CAI continues to track federal courts challenges of the Act and is in contact with the United States Department of Treasury urging an administrative delay be issued due to the chaos and confusion created by these recent court rulings, Congress’s decision not to take legislative action to extend the filing deadline, and the end of year holidays.

For additional information and updates on the Texas Top Cop Shop case appeal and its applicability to the Act visit www.caionline.org/CTA.

Updates on The Corporate Transparency Act as of 12/18/2024

 

 

 

By Kieran J. Purcell, Esq.

 

*This article is an update to the previous versions:

U.S. DISTRICT COURT DENIES GOVERNMENT’S MOTION TO STAY PRELIMINARY INJUNCTION OF THE CORPORATE TRANSPARENCY ACT

On December 17, 2024, the U.S. District Court for the Eastern District of Texas denied the Government’s Motion to Stay Preliminary Injunction Pending Appeal of the December 3, 2024 decision in Texas Top Cop Shop, Inc., et al. v. Garland, et al. which imposed a preliminary nationwide injunction against the Corporate Transparency Act (Act).

In making its decision, the Court noted when Congress enacted the Act almost five years ago, the Act had no implementation date, so there is no compelling need to lift the stay, especially where the Court has found the statute to likely be unconstitutional.

The Court also cited FinCEN’s recent website alert announcing a stay on the January 1, 2025, beneficial ownership information (“BOI”) reporting deadline pending determination of the appeal. Due to the widespread media coverage of FINCEN’s alert, the Court concluded lifting the stay would add to, not alleviate, public confusion about the Act.

In conclusion, the Court’s decision means the December 3, 2024 injunction remains in effect until the Fifth Circuit Court of Appeal rules otherwise. However, it is important to remember the order is still a preliminary injunction only. While it temporarily pauses enforcement of the Act on a nationwide basis, enforcement could resume if the injunction is later reversed.

For additional information and updates on the Texas Top Cop Shop case appeal and its applicability to the Act visit www.caionline.org/CTA.

 

You’ve Been Served – An Article to Supplement Epsten, APC’s Litigation Checklist

Hannah I. Hughes, Esq.

Attorney

858.527.0111
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Practice: Civil Litigation

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“You’ve been served” are three little words that no one wants to hear. But what exactly does that mean and what should you do when you are served with a lawsuit?

Our firm has created a checklist for when you have been served with a lawsuit, which can be located here: https://www.epsten.com/youve-been-served-lawsuits-checklist/. This article is intended to serve as a supplemental article to that checklist.

If you are served with a lawsuit, it is important to note the time, date, and method of how the lawsuit was served on you. It is important to immediately provide this information to your legal counsel, along with copies of all documents that were served on you, so that they can determine first whether service was proper and second when a response to the lawsuit is due. For example, documents served in-person have a thirty (30) day deadline to file a response while documents served via mail will provide you with an additional two (2) days to respond. If the Association does not respond by the deadline, they may not be able to protect their interests in the lawsuit.

Once you have provided your legal counsel with a copy of the documents and a detailed explanation of the date, time, and method of service, you should also provide the same to your insurance carrier. Your insurance carrier is the only one that can determine whether there is insurance coverage for the claim. Among the benefits of tendering the lawsuit to your insurance carrier is that they could accept the claim and provide defense counsel for the Association. This means that the association’s legal fees and costs would be covered by your insurance carrier.

After providing your legal counsel and your insurance carrier with a copy of the documents that you were served with, along with a detailed explanation of the date, time, and method of service, it is important that you preserve potential evidence related to the lawsuit. The Board of Directors, the Community Association Manager, and any and all employees have a duty to preserve related evidence once a lawsuit is filed. This means that you cannot delete, remove, or otherwise destroy related evidence including, but not limited to, emails, Board Meeting Minutes, Invoices, letters, photographs, video, etc. Your attorney likely will send a letter to notify affected parties of their duty to preserve evidence.

In addition to preserving potential evidence, you must also preserve the attorney-client privilege. The attorney-client privilege serves to protect client communication to or from their attorney. This includes oral or written communications whether in person, over the phone, or via email. However, the privilege only applies if it is a communication to or from your attorney. That means you should not forward any emails, documents, or other correspondence from your attorney to anyone who is not the Community Association Manager or a member of the Board of Directors. Additionally, you should not discuss the case with anyone who is not a member of the Board of Directors or your Community Association Manager. Remember, the client holds the privilege; this means the client can waive that privilege by sharing information with a third party. It is important that you do not waive this privilege by including a third party who is not subject to the privilege.

Finally, some owners within the association may request notice or information regarding the lawsuit so that they can determine whether they need to inform or notify any potential buyers or other third parties. Although the association is not required to provide this information, your attorneys can prepare a letter to the membership regarding the litigation that is informative but does not waive the attorney-client privilege.

While the three little words “you’ve been served” may not be as sweet as “I love you”, they should be taken just as seriously. Be sure to utilize the checklist we have provided to assist you if you ever hear those three little words.

Updates on The Corporate Transparency Act as of 12/9/2024

Kieran J. Purcell, Esq., CCAL

Managing Shareholder

858.527.0111
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Practices: Community Association Counsel 

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*This article is an update to the previous versions:

 

 

APPEAL OF TEXAS FEDERAL COURT RULING ENJOINING ENFORCEMENT OF THE CORPORATE TRANSPARENCY ACT

On December 5, 2024, the Government appealed the December 3, 2024, decision of the U.S. District Court for the Eastern District of Texas in the matter of Texas Top Cop Shop, Inc., et al. v. Garland, et al. which issued a preliminary nationwide injunction against the Corporate Transparency Act (Act).

Shortly thererafter, FinCEN posted an alert on its website announcing a stay on the January 1, 2025, beneficial ownership information (“BOI”) reporting deadline pending determination of the appeal. In its alert, FINCEN noted “in light of a recent federal court order, reporting companies are not currently required to file beneficial ownership information with FinCEN and are not subject to liability if they fail to do so while the order remains in force. However, reporting companies may continue to voluntarily submit beneficial ownership information reports.” 

As previously reported, the court’s order is a preliminary injunction only. While it temporarily pauses enforcement of the Act on a nationwide basis, enforcement could resume if the injunction is later reversed.

For additional information about the Texas Top Cop Shop case and its applicability to the Act visit www.caionline.org/CTA.

Updates on The Corporate Transparency Act as of 12/4/2024

 

 

By Kieran J. Purcell, Esq.

 

*This article is an update to the previous versions:

TEXAS FEDERAL COURT ENJOINS ENFORCEMENT OF THE CORPORATE TRANSPARENCY ACT

On December 3, 2024, the U.S. District Court for the Eastern District of Texas published a decision in the matter of Texas Top Cop Shop, Inc., et al. v. Garland, et al. issuing a preliminary nationwide injunction against the Corporate Transparency Act (Act).

The court granted Plaintiff’s request for a preliminary injunction, blocking the U.S. Department of Treasury from enforcing the Act or its beneficial ownership information (BOI) reporting requirements, ruling “Neither may be enforced, and reporting companies need not comply with the CTA’s January 1, 2025, BOI reporting deadline pending further order of the Court.”

On December 4, 2024, the Community Association Institute (CAI) stated the court’s preliminary injunction applies nationwide, halting enforcement and compliance of the Act’s beneficial ownership reporting requirements across the entire United States. Notably, CAI’s legal team stated it believes the injunction applies to all common interest developments incorporated in the United States.

The court’s order is a preliminary injunction only. While it temporarily pauses enforcement of the Act on a nationwide basis, enforcement could resume if the injunction is later reversed. As of this writing the federal government has not issued a public statement so it is unclear if it intends to appeal the court’s decision.

For additional information about the Texas Top Cop Shop case and its applicability to the Act visit www.caionline.org/CTA.