By David Swedelson, SwedelsonGottlieb Partner, Condo Lawyer and HOA Attorney
These days, going “green” is all the rage. So, it is no surprise that lately we are getting more and more inquiries from boards wondering how they should respond when homeowners request authorization to install solar panels. If the owner wants to install the solar panels on the common area, such as the roof of a condominium building, the answer is easy: “NO.” Owners do not have the right to install any type of modification on the common area, and solar panels are no exception.
However, it is a different story when owners request permission to install the solar panels on their own roof. As you might suspect, the answer is more complicated. Regardless of what the association’s governing documents may say, Civil Code Sections 714 and 714.1 limit the ability of a homeowners association to restrict the installation of solar panels within a separate interest. Civil Code Section 714 says, among other things, that a community association cannot enact a covenant, restriction or condition which limits or restricts an owner’s ability to install a solar energy system. In fact, any such covenant, restriction or condition is considered “void and unenforceable”. If homeowners want to install solar panels on their separate interest (meaning on their own home or yard), they must submit an architectural application as would be required for any other exterior improvement or modification. However, because of the limitations of the Civil Code, the architectural committee (or board) cannot deny the application for solar panels simply because solar panels do not fit in with the aesthetics of the development.
Pursuant to Civil Code Section 714, although the association cannot prohibit the installation of solar panels outright, it can require reasonable standards, alternative products and/or compliance with specified installation guidelines. Reasonable restrictions which the association can impose include prohibitions that (1) do not significantly increase the cost of the system (more than 20%), (2) do not significantly decrease efficiency or performance (more than 20%), or (3) allow for alternative systems of comparable cost, efficiency and energy conservation. This means that while the association cannot prohibit an owner from installing solar panels on their roof altogether, it can prevent the owner from installing them in a way that is particularly obtrusive.
This became a big issue in a recent lawsuit where some homeowners at a community association in Valencia decided that they had the right to maintain solar panels on their property despite their association’s objections. In this case, Tesoro Del Valle Master Association v. Griffin, the board of Tesoro Del Valle, a development of 1,100 homes, objected to the presence of 22 solar panels that the Griffins installed in their yard near a public sidewalk without board or architectural committee approval. Although the Griffins also installed 36 solar panels on their roof, the association did not challenge those. At trial, a jury agreed with the association that the Griffins had to remove the solar panels installed in their yard even though their association allowed other residents to put them on or near their homes. Although the Civil Code does place restrictions on an association’s right to regulate the installation of solar panels, the court correctly noted that this does not take away all of the association’s authority, as it is permitted to impose “reasonable restrictions” on solar panel installation. The association’s attorney, following the November 2, 2009 verdict, stated that the verdict was a “vindication of the right of homeowners associations to protect the communities they managed to balance the need for renewable energy with the integrity of their communities.” Click here to view an article that was written in the Los Angeles Times regarding this case and here to read the Daily Journal article about this case.
In addition to requiring architectural committee or board approval in order to be permitted to install solar panels, the Civil Code requires that the homeowner provide for maintenance, repair, or replacement of roofs or other building components that is required as a result of the solar panels. The association can require the installers of solar panels to indemnify or reimburse the Association or its members for damage or loss caused by the installation, maintenance, or use of the solar panels. This is an important provision, and we typically advise our association clients to enter into an indemnity agreement or covenant (which should be prepared by the association’s attorney) by which the owner agrees to indemnify the Association for any damage that may be caused by the solar panels. Even in the case of a planned development, it is possible for a solar panel on a roof to become detached after a heavy wind, or for a solar panel installed in the ground to affect the slope stability of adjacent lots, and the board should be sure that the association is protected if something like that happens and common area or another owner’s property is damaged.
In summary, the board cannot maintain a blanket prohibition on solar panels, nor does it have to automatically approve them. Rather, the request should be considered like any other request for exterior improvements, taking into consideration the above limitations on the association’s authority. If the request is rejected, the homeowner has the burden of demonstrating that the restrictions are not reasonable, for example by providing evidence that the solar panels that would be acceptable to the Board would exceed 120% of the cost of the homeowner’s proposed solar panels.
If an association is receiving a number of requests for solar panel installations, it should consider implementing a set of operating rules that deals exclusively with solar panel requirements. And if you have questions, contact David Swedelson at dcs@sghoalaw.com.