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By Sandra L. Gottlieb, Esq., SwedelsonGottlieb Managing Partner; Community Association Legal Counsel

In 2002, the California Law Revision Commission (CLRC) was charged by then-Governor Gray Davis with clarifying ambiguities within the Davis-Stirling Act. (Civil Code Sections 1350-1378) to make it more “user-friendly” for homeowners and board members alike. After working fro many years with stakeholders, including a working group of attorneys, community managers and other industry professionals, the CLRC is behind the introduction of AB 805 (Torres), a two-year bill which must first be passed by both the Senate and Assembly and ultimately signed by the governor into law.

At this point, it is highly likely that AB 805 will make its way through both houses in 2012, with an effective date of either January 2013 or (the more likely date of) January 2014. Attorneys and managers alike will need continuing education to learn the new code provisions, sections and numbering.
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(a) The following provisions do not apply to a common interest development that is limited to industrial or commercial uses by zoning or by a declaration of covenants, conditions, and restrictions that has been recorded in the official records of each county in which the common interest development is located:

(1) Section 1356.

(2) Article 4 (commencing with Section 1357.100) of Chapter 2 of Title 6 of Part 4 of Division 2.

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(a) The owner of a separate interest, other than an owner subject to the requirements of Section 11018.6 of the Business and Professions Code, shall, as soon as practicable before transfer of title to the separate interest or execution of a real property sales contract therefor, as defined in Section 2985, provide the following to the prospective purchaser:

(1) A copy of the governing documents of the common interest development, including any operating rules, and including a copy of the association’s articles of incorporation, or, if not incorporated, a statement in writing from an authorized representative of the association that the association is not incorporated.

(2) If there is a restriction in the governing documents limiting the occupancy, residency, or use of a separate interest on the basis of age in a manner different from that provided in Section 51.3, a statement that the restriction is only enforceable to the extent permitted by Section 51.3 and a statement specifying the applicable provisions of Section 51.3.

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(a) The articles of incorporation of a common interest development association filed with the Secretary of State shall include a statement, which shall be in addition to the statement of purposes of the corporation, that does all of the following:

(1) Identifies the corporation as an association formed to manage a common interest development under the Davis-Stirling Common Interest Development Act.

(2) States the business or corporate office of the association, if any, and, if the office is not on the site of the common interest development, states the front street and nearest cross street for the physical location of the common interest development.

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Blog Post by David Swedelson and Sandra Gottlieb, Senior Partners at SwedelsonGottlieb; Condo Lawyers and HOA Attorneys

SB 559 goes into effect on January 1, 2012 and expands the prohibited bases of discrimination under the Unruh Civil Rights Act and the California Fair Employment and Housing Act (FEHA) to include genetic information.

“Genetic information” is broadly defined, and includes information relating to an individual employee’s genetic tests, the genetic tests of the employee’s family members, and the manifestation of a disease or disorder in the employee’s family members. Under the new law, discrimination in hiring or employment based on any of these characteristics would be considered a violation of law.

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Blog post by David C. Swedelson, California Condo Lawyer and HOA/ Community Association Attorney
We regularly handle cases where the owner has sued the association as a defense to their association’s claims against them. These cases sometimes go to trial as efforts to settle are not successful, and more often then not, the association prevails and recovers an award of attorneys’ fees. Often for substantial sums of money.

The case of Seltzer v. Eugene Burger Management Corp., an unpublished appellate court decision, is a perfect example as to why owners need to think twice before suing their association. Here, Seltzer filed a lawsuit against the association and its management. Seltzer, an attorney and owner of a condominium unit located in a Marin City condominium development known as The Headlands View Homes filed the lawsuit seeking, among other things, to enjoin what Seltzer alleged were unlawful actions on the part of the association’s management. The association then filed a cross-complaint alleging that Seltzer had damaged and destroyed trees without the association’s authorization (the trespass claims) and claims arising from Seltzer’s failure to pay assessments (the assessment claims).
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By Sandra L. Gottlieb Condo Lawyer and Community Association Attorney at SwedelsonGottlieb

It is a sign of the times that an association’s board of directors has to consider and consult with association legal counsel on the association’s responsibilities with respect to an owner’s separate interest unit or lot to which the association obtains title through the nonjudicial foreclosure process (for purposes of the following discussion, we will refer to an owner’s separate interest unit or lot as a “unit”). As more and more California community associations are deciding to foreclose against an owner’s unit for non-payment of assessments (rather then waiting for the senior lien holder to foreclose), and with many associations taking title by reversion to units following those foreclosure sales (when third parties don’t bid on the unit at the foreclosure sale), many association boards and managers want to know what the association’s responsibilities are once it takes title to a unit through foreclosure.
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By David Swedelson and Alyssa Klausner, Attorneys at SwedelsonGottlieb, Condo Lawyers and HOA Attorneys

When a delinquent owner files for bankruptcy relief by filing a petition under either Chapter 7 or Chapter 13 of the United States Bankruptcy Code, the Code provides that an automatic stay, subject to certain exceptions, is immediately put into place. An automatic stay is like a restraining order, and it happens as soon as the bankruptcy is filed. This “stay” applies to creditors, including the association to whom the owner owes money, and it means an association can no longer collect or even attempt to collect any money (or foreclose on the property) from the owner, at least without getting permission from the bankruptcy court. The stay is intended to protect the delinquent owners who file bankruptcy. All actions to collect the delinquent assessments must stop, including lawsuits, foreclosures, as well as the suspension of membership and/or common area privileges.
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