SUMMER 2021
Your Term Is Up UNDERSTANDING TERMS OF OFFICE FOR BOARD DIRECTORS. PAGE 4
Say What? COMMUNICATING EFFECTIVELY DURING A CONSTRUCTION DEFECT CLAIM. PAGE 12
Association Elections HOW MANAGERS CAN KEEP THE PROCESS CIVIL. PAGE 8
Harassment Hassles
WHAT’S THE ASSOCIATION’S ROLE IN HANDLING COMPLAINTS? PAGE 6
Neighbor Disputes WHEN TO GET INVOLVED OR STAY OUT OF IT. PAGE 14
Summer Socials
WHAT TO CONSIDER AS COVID RESTRICTIONS EASE. PAGE 10
Summer 2021
A PRACTICAL REVIEW OF COMMUNITY MANAGEMENT LAW
2021 CACM Summer Law Journal Editorial Committee Chief Editor Attorney Guest Editor
Fred Whitney, Esq. Whitney | Petchul James Judge, Esq. The Judge Law Firm
Spring Journal Committee Members Mike Kennedy, Esq. Berding | Weil LLP Eric Kazakoff, CCAM Canyon Lake Property OA Marne Logan, CCAM Indio Springs RV Resort Jill Morgan, CCAM Allure Total Management
Sarah Van Daele Katzakian Property Management, Ltd. Hamlet Vazquez, MCAM-HR Action Property Management, ACMC Rhonda Adato, Esq. Epsten, APC
An archive of past issues can be found under Member Resources at CACM.org. The CACM Law Journal is a digital publication distributed four times per year to all members, in addition to supporters of the California Association of Community Managers. DISCLAIMER: CACM does not assume responsibility for the accuracy of articles, events or announcements listed. Please be advised that the opinions of the authors who contribute to the Law Journal are those of the author only, and do not necessarily reflect the opinions of CACM and other industry attorneys. Please note that in a constantly evolving industry there are frequently multiple interpretations of the controlling statutes and case law. The information contained in these articles is of a general nature and not intended as legal advice. If you have any questions, please discuss them with your association’s legal counsel.
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Letter from the Guest Editor Sometimes I have a problem not knowing when it would best serve me and everyone else to just shut up. As the late President, Calvin Coolidge said: “Silence cannot be misquoted.” But in writing this Editor’s Column for you, the readers of this Summer Law Journal, I can’t think of a thing to say. What’s going through my mind is a visual panorama of how the editorial committee and some mighty talented authors brought this edition to life. It was something to see.
“
The credit is all theirs. Maybe that’s why I find myself with nothing to say – for a change, some
I won’t take up your time and waste space naming all the topics that are covered in this publication. All of you kind readers will see that for yourselves. Our team from the start chose to focus on issues that, in addition to some time-worn but still very important ones, were ones we hoped and believe are pertinent right now, when managers especially have found and still find themselves dealing with
Silence cannot be misquoted.
things that we never thought in a million years we would have to deal with.
Yet here we are. I hope, kind readers, that you find something in this edition that helps you with what you face today, and that there are answers you find here that help you
“
may hastily add.
now, in what many say is the most challenging job there is – community management. It has been an honor to watch the amazing team that brings you this edition of the Law Journal as their handiwork unfolded. I hope you find it a good read.
James A. Judge, Esq. is founder and managing partner of The Judge Law Firm. He’s an expert in common interest development and real estate law, and has worked in the industry since 1982.
cacm.org | The Law Journal Summer 2021 3
P U S I M R E T R U YO Maximum and minimum terms for board directors, and pros and cons of staggered versus concurrent appointments.
BY TYLER KERNS, ESQ.
A
director’s “term of office” refers to the period of time for which he or she is elected to serve on the board of directors. When preparing for an association election, it is important to understand the term of office for the directors of the particular association and some of the issues that can arise relating to terms of office. Provisions regarding terms of office for directors are typically found in an association’s bylaws. However, an association’s articles of incorporation may also include a provision regarding director terms of office. If there are no provisions regarding terms of office in either the bylaws or the articles of incorporation, it may be worth taking a look at the CC&Rs (in particular, older CC&Rs sometimes include provisions that would more appropriately be included in bylaws). If an association’s governing documents are silent as to director terms of office (which would be very unusual), Corporations Code §7220(a) provides that the default term of office is one year. Corporations Code §7220(a) also provides that the maximum allowable term of office for directors is four years. STAGGERED OR CONCURRENT TERMS Terms of office may be concurrent or staggered. Concurrent terms of office mean that all directors’ terms expire at the same time. As such, at every election, the entire
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board is up for election when an association’s directors serve concurrent terms. With staggered terms of office, on the other hand, the terms of office of different groups of directors expire in alternating years. For example, with a board consisting of five directors serving staggered two-year terms, if two directors are up for election every even-numbered year, then the other three directors would be up for election every odd-numbered year. Staggered terms can be advantageous because they ensure that at every election, there will always be one or more directors (depending on the size of the board) who will remain on the board with knowledge of any ongoing issues that the association is facing at the time. Concurrent terms of office are most commonly for one year, and staggered terms of office are most commonly for two years. Accordingly, most associations hold director elections every year as part of their annual meeting of members. As discussed above, depending on whether the association has concurrent or staggered terms of office for directors, either all or some of the seats on the board of directors will typically be up for election each year. However, some associations have concurrent director terms of office that are longer than one year, and in
those associations, an election of directors only needs to occur as frequently as the expiration of the directors’ terms. For example, if an association’s directors are elected for concurrent terms of three years each, then an election of directors would only occur every three years. Again, remember that Corporations Code §7220(a) provides that the maximum allowable term of office for directors is four years, and Civil Code §5100(a)(2) requires that associations hold a director election at the expiration of the directors’ terms of office and at least once every four years. TERM LIMITS Pursuant to Corporations Code §7220(b), unless an association’s bylaws or articles provide otherwise, each director shall hold office until the expiration of their term and until a successor has been elected and qualified (unless the director is removed from office). Directors may be elected for an unlimited number of successive terms. Some associations had historically implemented term limits for directors in accordance with their governing documents. Term limits are intended to limit the number of terms (or, more often,
the number of successive terms) to which a director can be elected. However, upon the passage of Senate Bill 323, Civil Code §5105 was amended effective January 1, 2020 to specify reasons for which a person could be disqualified as a candidate for election to the board. Having served a maximum number of prior terms was not included in the list of specified reasons for disqualification and, therefore, term limits are now seemingly unenforceable. As of the time of this writing, new “clean-up” legislation is pending that would add the following to the list of permissible reasons for disqualifying a person as a candidate for election: “If the person has served the maximum number of terms or sequential terms allowed by the association.” If passed, the new legislation would once again allow associations to adopt and enforce term limits if set forth in their governing documents. Lastly, since provisions regarding terms of office for directors are included in an association’s governing documents (typically the bylaws), any change to the governing document provisions regarding director terms of office would
require an amendment to the governing documents. Civil Code §5100(a)(1) includes amendments to the governing documents as one of the matters that must be approved by a vote of the owners conducted in accordance with the statutory secret ballot voting process. Associations should consult with legal counsel regarding any potential changes relating to director terms of office.
Tyler Kerns, Esq. is an attorney specializing in community association law with Kriger Law Firm. He’s worked in the industry for 11 years and is based out of La Mesa, California.
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cacm.org | The Law Journal Summer 2021 5
Not Playing Nice in the Sandbox –
Handling Harassment Hassles By Megan Hall, Esq.
T
he responsibilities and potential
between guests and employees/vendors, etc.
liabilities for homeowner’s
This expansion of responsibility and potential
associations related to complaints of
liability may leave you asking, what can an
harassment have increased from 2016 until the present, leaving directors and managers to cope with an increase in such complaints. Effective January 1, 2020, the California Department of Fair Employment and Housing provided guidelines for associations to address discrimination and harassment claims. (See Calif. Code of Regs §§ 12000-12271.) These regulations, similar to the prior U.S. Department of Housing and Urban Development (HUD) regulations, hold an association liable for failing to take corrective action to end discriminatory or harassing conduct of a third party. For associations that have employees, there are additional obligations to prevent and investigate harassment of employees. (See Government Code §§ 12900-12996; 2 Calif. Code of Regs. §§ 11000-11141.) In other words, under certain circumstances, an association can be held liable for harassment between residents, between residents and employees/ vendors, between guests and residents,
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association do?
Investigation If an association’s manager or a board member receives a complaint of harassment, the board will need to take steps to investigate the complaint. The association’s responsibility to take corrective action depends on whether the harassment is based on the individual’s membership in a protected class, being perceived as being a member of a protected class, “or on account of having aided or encouraged any person in the exercise of rights protected by the Act.” (2 Calif. Code of Regs. § 12120(e).) In California, protected classes include race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, marital status, national origin, ancestry, familial status, source of income, disability, age, medical condition, genetic information, citizenship, primary language, immigration status, military or veteran status. (Cal. Gov’t Code § 12940(a).) If the harassment is not based on one of the above-listed protected classes, the board may be under no duty to take further action in “neighbor to neighbor disputes.”
If the alleged harassment is based on one of the above listed protected classes, the board should continue their investigation. In conducting their investigation, the board should speak with the complaining party, the accused, as well as any witnesses. The board may also consider evidence presented by either party. Harassment can be either quid pro quo harassment, which is an unwelcome request or demand to engage in conduct where submission to the request or demand, either explicitly or implicitly, is made a condition to other actions; or hostile environment harassment, which includes violence, a credible threat of violence or an unwelcome course of conduct that is sufficiently severe or pervasive. (Cal. Code of Civil Proc. §§ 527.6, 527.8.) The board can consider factors such as the nature of unwelcome conduct, the context in which the incident(s) occurred, the severity, scope, frequency, duration and location of the conduct, and the relationships of the people involved. (2 Calif. Code of Regs. § 12120). These factors are considered from the perspective of a reasonable person. There does not need to be psychological or physical harm for a hostile environment to exist.
Action The board should make a determination
In California, protected classes include race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, marital status, national origin, ancestry, familial status, source of income, disability, age, medical condition, genetic information, citizenship, primary language, immigration status, military or veteran status. (Cal. Gov’t Code § 12940(a).)
Prevention Associations can and should take steps to address and educate residents, directors, and employees about harassment. One step is training. This can take the form of board and/or employee training related to the laws regarding harassment and the association and/or their responsibilities related to the same. This can also take the form of a membership meeting or town hall discussion related to these issues. Due to the large number of categories that define a “protected class” in California, educating and opening discussion as to issues such as blatant harassment or microaggressions can go a long way in making the association a place that people feel happy and comfortable living in. Another step is the adoption of policies and/or rules related to harassment. These policies/rules should clearly define the type of prohibited behavior, outline the steps for making a complaint, outline the steps that the board will take in investigating complaints, and outline corrective action that may be taken. A good policy/ rule will also indicate what steps the individual reporting harassment and/or the association may take if the matter is outside the scope of the association’s authority.
under the governing documents, be it fines or the suspension of privileges.
as to whether harassment has occurred in executive session. If the board determines
If the harassment is against an employee,
that harassment has occurred, the board
independent contractor, volunteer, or board
must take action.
member, the board can seek a protective order on behalf of the harassed individual.
The board should have their general
(See Code Civ. Proc. § 527.8.) A workplace
counsel send a written cease and desist
restraining order is appropriate if the
demand to the harassing party. Further,
individual “has suffered unlawful violence
for harassers who are members or tenants,
or a credible threat of violence from any
the board should follow the enforcement
individual, that can reasonably be construed
provisions under its governing documents.
to be carried out or to have been carried
At the beginning of corrective action,
out at the workplace...” (Id.) As options for
the board should conduct a hearing in
addressing harassment may be limited
executive session, after which the board
under the governing documents, the board
can take further corrective action permitted
should take such action if warranted to address the behavior.
Megan Hall, Esq. serves as corporate and litigation counsel to boards of directors of common interest developments throughout California. She’s an attorney with Adams | Stirling PLC.
cacm.org | The Law Journal Summer 2021 7
A S S O C I AT I O N E L E C T I O N S
Welcome to the Era of Sharp Elbows By Dave Feingold, Esq. and Matthew Haulk, Esq.
T
he 19th century historian and philosopher Thomas Carlyle was combative by nature, and was of the view that “‘[n]o man lives without jostling and being jostled. In all ways he has to elbow himself through the world, giving and receiving offense.’’ While cynical, the metaphor “sharp elbows” is part of the lexicon, used to refer to anything from British constables elbowing their way through crowds to ruthless businessmen. Today, it seems to be used most often to describe a politician who views giving offense to others as a strategic advantage. Political rhetoric in local, state, and national elections has become increasingly less civil and hard to avoid as it is amplified by the ubiquitous nature of social media and electronic communications. This has predictably trickled down to association elections, where selecting volunteer leaders who will have an impact on a member’s home, money – and even family – can trigger strong emotions. As the first and primary source of guidance for volunteer directors, the community manager has an important role to play, especially when it comes to educating sitting directors during an election on two important concepts: free speech rights and the association’s proper role during an election.
FREE SPEEC H RIGHTS
Directors and members are often surprised, and dismayed, to learn that the association has little
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an unprivileged false written or oral statement of fact that causes harm to another person. As a community manager you do not need to become a legal scholar on the laws of free speech, defamation or the nuances of anti-SLAPP motions. Consult with legal counsel, as necessary. You do need to know that, while exceptions to the general rule exist, even offensive statements during an election more often than not fall into the category of protected speech.
control over uncivil campaign advocacy. Common interest developments (“CID”) are considered “quasi-governmental” entities for many purposes, including when it comes to elections. California courts considering the broad free speech rights of community members have likened association elections to elections for public office, recognizing that “[p]ublic discussion about the qualifications of those who hold or who wish to hold positions of public trust presents the strongest possible case for application of the safeguards afforded by the First Amendment.” (Damon v. Ocean Hills Journalism Club (2000) 85 Cal.App.4th 468, 473 (quoting from Matson v. Dvorak, 40 Cal.App.4th at 548).) What this means is that a statement about a matter of community interest (e.g., an election), even if rightly perceived as offensive or misleading, is protected speech. That speech may cross the line into actionable defamation, which in broad terms is
Case law has confirmed this conclusion time and time again, and these examples are instructive: • A statement made by a director running for re-election that a critic had “stolen from and defrauded the association” was not actionable defamation. Cabrera v. Alam (2011) 197 Cal. App.4th 1077. • Statements at meetings and in newsletters accusing the manager of incompetence and demanding he be fired was not actionable. Damon v. Ocean Hills Journalism Club (2000) 85 Cal.App.4th 468. • Statements by members in meetings and on a website promoting the recall of a director claiming the director was a “convicted criminal” and a “child molester” (or “pervert”, accounts differed) were not enough to avoid
dismissal. Glassner v. Smith (Unpublished, not citable - 2015 WL 2127065). • Defamation lawsuit filed by a critic of a national candidate who was called “a real dummy” and a “major loser” with “zero credibility” was dismissed. Jacobus v Trump (2017 NY Slip Op 27006 (January 9, 2017 Supreme Court, New York County). The examples above are not meant to dissuade associations from doing everything they can to encourage and promote civility in the community or to take action as needed based on advice of counsel. They should. However, these examples do bring home the need to remember that having thick skin is an important safeguard against overreacting to such heated rhetoric.
THE PROPER ROLE OF THE ASSOC IATI ON
As you undoubtedly know, the Davis Stirling Act regulates elections. The sweeping new DSA election law (SB 323) that took effect in 2020 was expressly adopted to limit board discretion in how associations conduct elections, and in response to the assertions of its proponents that reform was needed because “…incumbent boards have seized upon this discretion to undermine the democratic function of the elections…”. Thus, it is important to understand that when the legislature regulates elections it is not because it is concerned about promoting civility, rather it is concerned that incumbent directors (or their agent, the community manager), may put their considerable influence on the scale in favor of preferred candidates. In a nutshell, the association should be like Switzerland during an election. It must follow the law and the DSA compliant Election Rules and remain neutral as an organization. The association should not be in the business of factchecking or policing campaign communications outside of association channels, such as via mass email blasts sent by candidates or their supporters (using the membership list) or on social media such as Nextdoor or Facebook. Let the candidates and their supporters respond if needed. Specific complaints may also be made by members directly to the social media platform or the moderator of the platform, along with a demand that offending rhetoric is removed as not following the platform guidelines. For the community manager, an agent of the association, it is especially important to not make any statements favoring one candidate over another, and most importantly in communications sent to the members. As to
The association should not be in the business of fact-checking or policing campaign communications outside of association channels. sitting directors, those running for reelection of course will campaign and promote their own reelection. While other sitting directors have a right as members to publicly endorse or otherwise advocate for a candidate of their choice, consider whether that is a best practice or creates disharmony on the board. At the very least any written campaign advocacy from sitting directors should include a disclaimer that the director is not speaking in their official capacity or for the association, and that association funds were not used to endorse that candidate. Abraham Lincoln said in his first inaugural address that political strains should not break the “bonds of affection.” While the strains of Lincoln’s era are in no way comparable to the strains created by heated rhetoric in an association election, it is important to remember that members and directors within an association are members of the same community, first and foremost. They can and should be reminded of their common interest and keep their elbows to their sides.
Election Tactics to Consider While it is not possible to eliminate all heated or offensive rhetoric, civil and respectful campaigning recognizing the shared interests of all members should be encouraged and promoted as a community attribute. A few suggestions to work toward this goal include: • Ensure you have properly adopted and compliant Election Rules. • Propose and work toward the adoption of Campaign Guidelines which, while not enforceable operating rules, set forth what the community expects during campaign in terms of respect and civility. • Adopt a Director Code of Conduct that sets guidelines for sitting directors to follow during elections and which reflects the high ethical standard that is expected from community leaders during elections. • Consider appointing an Election Committee of trusted and influential members of the community to work with the Inspector of Elections, and draft a charter for the committee that will guide its work in ensuring that the election process complies with the DSA and election rules and promotes ethical and civil tactics. • Hold more, not less association sponsored candidate forums and similar outreach, providing equal access to all candidates. Knowing such events are upcoming should reduce a member’s impulse to vent on Nextdoor or other platforms.
Dave Feingold, Esq. is a partner in the Marin County law firm of Ragghianti Freitas, LLP, where he is part of the real estate group.
Matthew Haulk, Esq. practices community association law in the San Francisco Bay Area and is a partner in Ragghianti Freitas, LLP.
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With summer approaching and people across California in desperate need of socializing, the demands on community associations to reopen common area facilities and resume association social events and gatherings are bound to increase. In anticipation, your association should take the time to review federal, state and local guidelines and mandates to better understand what activities and facilities under its control are permitted and discuss how to best prepare for the demands and needs of pent-up residents while still complying with government restrictions and common-sense precautions.
PREPPING FOR SUMMER GATHERINGS By Jacquelyn Quinn, Esq.
KEEPING INFORMED In August 2020, the State of California released the Blueprint for a Safer Economy (“Blueprint”) to permit the gradual reopening of certain businesses and activities. As part of the Blueprint, every county is assigned to a tier each week based on its positivity and case rates. Since August 2020, the Blueprint has governed what businesses and activities can reopen and what restrictions must be followed in order to reopen. However, in April of this year, Governor Newsom announced expanded gathering and private event guidelines and that California is looking to move beyond the Blueprint. On June 15, 2021, tentatively, it is anticipated that all industries across California will be permitted to return to usual operations with commonsense risk reduction measures such as masking, increased cleaning and vaccinations. Local counties and cities may choose to impose additional or more restrictive requirements. This announcement certainly appears to be the light at the end of the tunnel that we’ve all been waiting for. However, if this last year has taught us anything it is just how quickly things can change. Something that is permitted one day can be prohibited the next without any warning. Therefore, while it might seem impossible to keep up to date with the ever-changing restrictions and guidelines, it is imperative for associations to do so. Associations must take steps to fight “pandemic fatigue” and remain vigilant and informed regarding government guidelines and mandates pertaining to reopening and gathering during COVID-19. Boards and association managers should routinely check state and any local restrictions and guidance, even as California moves beyond the Blueprint. Boards should rely on association experts, such as management and legal counsel, to advise regarding what activities are and are not permitted and how to reopen permitted common area facilities or hold permissible gatherings in compliance with government guidelines and mandates.
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POTENTIAL LIABILITY AND INSURANCE While everyone is eager to get back to a sense of normalcy, failing to follow guidelines issued by government authorities or take commonsense precautions could make it very challenging to demonstrate an association acted reasonably in its duty to exercise care in governing the common areas under its control and could expose the association to liability. If following guidelines in a meaningful manner is not feasible for an association (including following cleaning protocols, ventilation requirements, and capacity restrictions), then the reasonable action may be to leave common area facilities closed until such measures can be complied with. One potential source of liability community associations could face are claims by residents or guests who contract COVID-19 and allege that the community association failed to exercise reasonable care in guarding against, or warning of, the risk of exposure to the COVID-19 virus. Such a claim would likely be based on the fact that community associations have a duty to exercise due care for the safety of residents and guests in those areas under the association’s control (Frances T. v. Village Green Owners Ass’n. (1986) 42 Cal.3d 490). A person making such a claim may ultimately have a difficult time proving they caught COVID-19 at the association’s facilities and not, for example, the grocery store they recently visited. Nevertheless, any such claims brought against a community association should immediately be tendered to the association’s insurance companies under the general liability, directors & officers, and any umbrella policies. Unfortunately, not many, if any, community association insurance policies provide coverage for claims related to sickness or bodily injury caused by COVID-19. However, even if a community association’s policies contain these exclusions, the insurance company may have a duty to provide a defense for the association against any lawsuit filed, while reserving the right to not pay any uncovered claims. Boards should review their association’s insurance policies with the association’s insurance expert to understand levels of coverage, any exclusions, and what is considered a covered claim in the association’s specific policies.
NEXT STEPS AND CLEAR COMMUNICATION WITH RESIDENTS Before reopening any common area facility or amenity, associations should consider consulting with its facility experts (janitorial, engineering, plumbing) to prepare facilities that have been shut down or inactive for prolonged periods for reopening. Boards should also discuss whether amending operating rules for the use of these areas is needed to ensure compliance with the various government restrictions and guidance. Consider whether a reservation system is necessary to manage capacity limits or ensure proper social distancing is maintained at reopened facilities or permitted gatherings. Discuss with association legal counsel whether residents can be asked to sign a waiver to use common area facilities permitted to reopen or if vaccine or testing verification can be requested to attend association gatherings or private events. Remember, failing to have and follow proper protocols could expose the association to liability. Residents are understandably eager to use the common area facilities and socialize with the community at association events again. Frustrations are likely at an all-time high. That’s why clear communication with residents is key in these uncertain times. Associations should aim to provide residents with updates regarding the status of common area facilities and events and issue clear rules and expectations for holding or attending those activities when they are permitted to return. Staying up to date on the state’s guidance and mandates and how those impact association activities and facilities will allow boards and management to develop timely and informed plans and protocols that can easily be communicated to the community. Everyone is looking forward to getting back to a time where clubhouses, social gatherings and community events are permitted free of restrictions, and California seems to be taking a step in that direction. However, it is reasonable to anticipate that this may merely be a small step on a much longer road back to “normal.” Associations and residents should expect certain restrictions and common-sense measures to continue to be required at common area facilities and association gatherings and private events for the foreseeable future in what might be our “new normal.”
Jacquelyn Quinn, Esq. is an attorney with Epsten, APC, serving the San Diego region where she handles transactional matters for residential and commercial CIDs. She joined Epsten in 2019.
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The Importance of Effective Communication during a Construction Defect Claim By Ritchie Lipson, Esq.
Effective communication within a homeowners’ association is always important. Once an association brings a construction defect action against the community’s builder, communication and cooperation among the board, community association manager, and the association’s construction defect attorney become essential. With the outbreak of COVID-19, how we communicate and do business in the future, including within the context of construction defect claims, will most likely remain permanently changed. A construction defect action by a homeowners’ association usually begins with a Notice of Commencement of Legal Proceedings under the Calderon Act (Civil Code § 6000 et seq.) by the association to the builder, which concurrently satisfies the statutory requirement for a Notice of the Claim pursuant to Senate Bill 800. However, before the association’s attorney may prepare such notice, the attorney must investigate the defects in the community and discuss the identified defects with the board and the community manager. This conversation is the key to defining the scope of the action desired by the association. Sometimes, associations are concerned only about a few key issues. Other times, the association has a plethora of concerns about the construction of its community and wish to pursue all such issues. The attorney, board members, and manager should discuss these issues and the scope of its claim before the attorney prepares and serves the requisite notice on the builder. After the notice is served, California law provides for certain statutory time frames in which the builder can investigate the claimed defects, provide construction documents to the association, perhaps perform
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With today’s “new normal,” it is important to develop a detailed COVID-19-compliant inspection program that all experts, those for both the association and the defense, are required to follow. the same time keeping the claim moving
The diligent attorney will use a combination
forward.
of methods to keep the board and manager informed and will develop a
After the inspections, the builder’s attorney
communications plan at the beginning of
may provide some feedback on the
the legal relationship. Common methods
inspections to the association’s attorney.
are weekly or monthly updates sent via
The builder’s attorney may also reveal how
email to the manager and board members,
the builder views the case. The association’s
regular attendance at board meetings
attorney will then share this information
(both in executive and regular sessions, as
privately with the board and manager to
appropriate), and frequent written updates
develop the best strategy for addressing
suitable for sharing with all members during
the defects at mediation, which is required
key periods in the process.
pursuant to the Calderon Act. It seems we have now become comfortable
repairs, and provide an opportunity for the parties to mediate the dispute. During this time period, the builder will generally want to visually inspect and photograph the claimed defects. Seeing unknown people walking through the community and photographing various areas can be alarming for some residents. Thus, the construction defect attorney should develop an inspection schedule for the community and send out a representative from the attorney’s office to guide and monitor the builder’s investigators. The attorney should share the schedule with the board and manager who can provide feedback on the schedule and share the schedule with any concerned residents. Good communication between the manager, board, and members is essential at this point. With today’s “new normal,” it is important to develop a detailed COVID-19-compliant inspection program that all experts, those for both the association and the defense, are required to follow. This protocol should be communicated to owners so that they feel safe from increased exposure, while at
Calderon mediation generally occurs near
on how to handle meetings via Zoom or
the end of the 180-day window, after the
some other delivery service. This type of
parties have completed some inspections
online setting allows boards and owners
and consulted with experts. Board
to ask questions and participate from
members may attend the mediation as the
their own home without any additional
association’s elected representatives. At the
risks of exposure to the coronavirus. It has
mediation, the association’s construction
also been our experience that attendance
defect attorney will provide periodic
has improved online versus the in-person
updates to the board members as to the
meetings we conducted pre-pandemic.
status and progress of negotiations as advised by the mediator. If the mediation is successful, the attorney will provide an update and recommendation to the board as to a proposed settlement and will provide further information or answers to questions that board members may have. If the mediation is not successful, the attorney will provide a recommendation on how to proceed. This recommendation will include the filing of an action in Superior Court or binding arbitration. Again, effective and proactive communications between the attorney and the association client is crucial at this point in the claim. Throughout this process, the construction defect attorney, board members, and community manager must remain in regular, consistent communication to best facilitate the association’s construction defect action on behalf of all members of the community.
Ritchie Lipson, Esq. is Director of Client Relations for Kasdan Turner Thomson Booth LLP. For the past 20 years, Lipson has worked with commercial investors, municipalities, school districts, homeowner associations and residential property owners, to assist in the fair resolution of their claims for defective construction.
cacm.org | The Law Journal Summer 2021 13
The association’s role in neighbor to neighbor disputes.
PLAYING REF? By Sharon Glenn Pratt, Esq. and Patricia A. Wendleton
It is generally not an association’s job to police relationships and enforce friendships in the neighborhood. There are times, however, when a dispute between neighbors legally requires involvement and direct, prompt action by the association.
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NUISANCES If a dispute concerns complaints about things such as noise, smoke, or odors, it may constitute a nuisance. Virtually all association CC&Rs prohibit any activity that constitutes a nuisance or unreasonably interferes with the use and enjoyment of a home or common area. California law defines a nuisance as anything that is injurious to health, is indecent or offensive to the senses, or is an obstruction to the free use of property. (Civ. Code § 3479.) Neighbors may proceed directly against one another to enforce the association’s governing documents, but the association itself has a duty to enforce the governing documents as well. Boards have tools which are unavailable to individual owners, such as fines, assessments and suspension of privileges. The board should use its tools to intervene before the problem escalates. Duffey v. Superior Ct. (1992) 3 Cal.App.4th 425. This not only protects the association from liability, it often prevents litigation altogether, including the likelihood of the association being named as a party in the litigation between neighbors.
ailing to take prompt action … to correct or end a discriminatory housing practice by a third party … “when it knew or should have known of the discriminatory conduct and had the power to correct it.” (2 CCR §12010(c) (emphasis added).) The regulation specifically provides that governing documents are a source of power to correct or end a discriminatory practice. This duty exists even when the association has no involvement in the discriminatory practice. It is important to note that the duty exists even when the board has no direct notice of the problem, if the board should have known.
Boards have tools which are unavailable to individual owners, such as fines, assessments and suspension of privileges.
When the dispute involves a rules violation, such as crowding out the other neighbor’s parking spot or leaving a dog off leash, the board must enforce the rules, and do so uniformly. Starting with a warning, and stepping up to fines and other disciplines if necessary, the board can impose discipline rather than leaving it to the neighbors.
The federal law includes a like regulation which requires prompt action to correct and end a discriminatory housing practice. The power to take prompt action depends on the extent of the person’s right to control or any other legal responsibility the person might have with respect to the third party’s conduct. (24 CFR 100.7(a)(iii).) The federal regulations include homeowner associations as housing providers subject to the regulation.
DISCRIMINATION AND HARASSMENT
When discrimination is because of a person’s mental disability, it is particularly
difficult for the association to intervene. A daunting but not uncommon example occurs when a hoarding resident keeps his/ her unit in such an unsanitary condition that it becomes a breeding ground for pests, and the infestation spreads to neighboring units and causes horrible odor. Not unexpectedly, an affected neighbor can become so frustrated with the situation that he/she disparages the mentally disabled owner or tenant, lashes out, or worse. The mental health disorder of the offending neighbor may prevent that resident from ever remedying the situation as a reasonable person would, so typical warnings and fines are not likely to be enough. Not only must the association promptly intervene to stop the discrimination, it must also enforce its governing documents against a verified nuisance. The law requires the association to accommodate the disability, but also to enforce the governing documents, as appropriate, regarding the nuisance and any resulting damage. This creates a difficult balancing act for the board. Harassment and discrimination may also occur when an owner has a bias against the characteristics of a particular protected class, such as race. When a neighbor is complaining about another neighbor or turning them into the board for violations, it may not be readily apparent that the constant negativity is stemming from an illegal bias. The board must be ever vigilant regarding the possibility of things like racial bias being behind neighbor disputes of all sorts. In such cases, the board has a duty to promptly investigate, and to take action to end the discrimination.
Because homeowner associations are considered “housing providers,” subject to both California and federal fair housing laws and the Unruh Act, boards must get involved in allegations of discrimination or harassment, if it relates to a person’s membership in a protected class under the law. The Fair Housing Act’s (FHA) protected classes include race, color, religion, national origin, sex, disability and familial status. The California Fair Employment and Housing Act (FEHA) provides additional classes, including sexual orientation, gender identity or expression, marital status, medical conditions, ancestry, and age. The California Code of Regulations, which provides for the administration and enforcement of FEHA, enacted new regulations effective January 1, 2020. The new regulations include a regulation which makes an association directly liable for “[f]
Sharon Glenn Pratt is an attorney with Pratt & Associates, APC specializing in litigation, real estate law and homeowners association law. She’s based out of Los Gatos and has worked in the industry for 35 years.
Patricia A. Wendleton also is an attorney with Pratt & Associates, APC specializing in insurance, transactional and litigation law. She’s based out of Los Gatos and has worked in the industry for 35 years.
cacm.org | The Law Journal Summer 2021 15
2021 LEGAL DIRECTORY ASSESSMENT COLLECTION SERVICES ALLIED TRUSTEE SERVICES Assessment Collection & Judgment Recovery Services Stefan Murphy Serving All of California For Over 27 Years 990 Reserve Dr., Ste. 208 Roseville, CA 95678 (800) 220-5454 smurphy@alliedtrustee.com alliedtrustee.com ALTERRA ASSESSMENT RECOVERY Assessment Collection Services Steven J. Tinnelly, Esq. Your Association’s Assessment Collection Partner 27101 Puerta Real, Ste. 250 Mission Viejo, CA 92691 (888) 818-5949 ramona@tinnellylaw.com alterracollections.com FELDSOTT & LEE, A LAW CORPORATION Community Association Law Stanley Feldsott, Esq. Laguna Hills | San Diego 23161 Mill Creek Dr., Ste. 300 Laguna Hills, CA 92653 (949) 729-8002 • Fax (949) 729-8012 feldsott@gmail.com cahoalaw.com
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FIORE RACOBS & POWERS, A PLC Community Association Law and Assessment Collections Jacqueline D. Foster, Esq., Peter E. Racobs, Esq., & John R. MacDowell, Esq. The Recognized Authority in Community Association Law Orange County | Inland Empire | Coachella Valley l San Diego County (877) 31-FIORE • Fax (949) 727-3311 dweissberg@fiorelaw.com fiorelaw.com UNITED TRUSTEE SERVICES Trusted Partners In Assessment Collections Lisa E. Chapman Trusted Partners in Assessment Collections 696 San Ramon Valley Blvd., Ste. 353 Danville, CA 94526 (925) 855-8554 • Fax (925) 855-8559 lisa@unitedtrusteeservices.com unitedtrusteeservices.com
ATTORNEYS BEAUMONT TASHJIAN General Counsel and Assessment Collection Services Jeffrey A. Beaumont and Lisa A. Tashjian Woodland Hills, Laguna Hills, San Luis Obispo, Palm Desert, San Diego 21650 Oxnard St., Ste. 1620 Woodland Hills, CA 91367 (866) 788-9998 • Fax (818) 884-1087 info@HOAattorneys.com hoaattorneys.com BERDING | WEIL Construction Defect Litigation, General Counsel and Community Association Law Steve Weil | Tyler Berding l Chad Thomas | Andrea O’Toole Walnut Creek | Costa Mesa | San Diego 2175 N. California Blvd., Ste. 500 Walnut Creek, CA 94596 (800) 838-2090 • Fax (925) 820-5592 jjackson@berdingweil.com BerdingWeil.com CHAPMAN & INTRIERI, LLP General Counsel & Construction Defect Litigation John W. Chapman, Esq. & Mark G. Intrieri, Esq. Alameda l Roseville l Orange County l San Diego 2236 Mariner Square Dr., Ste. 300 Alameda, CA 94501 (510) 864-3600 • Fax (510) 864-3601 jchapman@cnilawfirm.com cnilawfirm.com COMMUNITY LEGAL ADVISORS, INC. General Counsel & Assessment Collections Mark Guithues, Esq. & Mark Allen Wilson, Esq. Inland Empire | Orange County | San Diego 509 N. Coast Hwy. Oceanside, CA 92054 (760) 529-5211 • Fax (760) 453-2194 mark@attorneyforhoa.com attorneyforhoa.com DELPHI LAW GROUP, LLP Attorneys James R. McCormick, Jr., Esq., CCAL Coachella Valley | Inland Empire | Los Angeles | Orange County | San Diego 1901 Camino Vida Roble, Ste. 100 Carlsbad, CA 92008 (844)- 4DELPHI • Fax (760) 820-2696 jmccormick@delphillp.com DelphiLLP.com
EPSTEN, APC Community Association Law, Construction Defect, Litigation & Assessment Recovery Jon Epsten, Esq. & Susan Hawks McClintic, Esq. San Diego | Inland Empire | Coachella Valley 10200 Willow Creek Rd., Ste. 100 San Diego, CA 92131 (858) 527-0111 • Fax (858) 527-1531 jepsten@epsten.com epsten.com
THE JUDGE LAW FIRM Collection Services, General Counsel and Mediation James A. Judge, Esq. Arbitrators & Mediators, Assessment Collection Services 18650 MacArthur Blvd., Ste. 450 Irvine, CA 92612 (949) 833-8633 • Fax (949) 833-0154 info@thejudgefirm.com thejudgefirm.com
FIORE RACOBS & POWERS, A PLC Community Association Law and Assessment Collections Jacqueline D. Foster, Esq., Peter E. Racobs, Esq., & John R. MacDowell, Esq. The Recognized Authority in Community Association Law Orange County | Inland Empire | Coachella Valley l San Diego County (877) 31-FIORE • Fax (949) 727-3311 dweissberg@fiorelaw.com fiorelaw.com
KRIGER LAW FIRM Community Association Law and Assessment Collections Bradley Schuber, Esq. 8220 University Ave., Ste. 100 La Mesa, CA 91942 (619) 589-8800 • Fax (619) 589-2680 bschuber@krigerlawfirm.com krigerlawfirm.com
GURALNICK & GILLILAND, LLP Association Law, Assessment Collections, General Counsel Wayne S. Guralnick, Robert J. Gilliland Jr. Serving Community Associations for Over 30 Years 40004 Cook St., Ste. 3 Palm Desert, CA 92211 (760) 340-1515 • Fax (760) 568-3053 wayneg@gghoalaw.com gghoalaw.com HICKEY & ASSOCIATES, P.C. Community Association Law David E. Hickey, Esq. 27261 Las Ramblas, Suite 120 Mission Viejo, CA 92691 (949) 614-1550 • Fax (949) 748-3990 dhickey@hickeyassociates.net HickeyAssociates.net HUGHES GILL COCHRANE TINETTI, PC Community Association & Construction Defect Law Michael J. Hughes, Esq., John P. Gill, Esq., Amy K. Tinetti, Esq. Complete representation of community associations 2820 Shadelands Dr., Ste. 160 Walnut Creek, CA 94598 (925) 926-1200 • Fax (925) 926-1202 atinetti@hughes-gill.com hughes-gill.com
THE MILLER LAW FIRM Construction Defect Analysis & Litigation Thomas E. Miller, Founding Partner, Rachel M. Miller, Senior Partner Serving Homeowners Associations Statewide for Over 40 Years San Francisco | Bay Area | LA | Orange County | San Diego| Inland Empire (800) 403-3332 rachel@constructiondefects.com constructiondefects.com PRATT & ASSOCIATES, APC Community Association Law Sharon Glenn Pratt Los Gatos, CA 634 North Santa Cruz Avenue, Suite 204 Los Gatos, CA 95030 (408) 369-0800 • Fax (408) 369-0752 spratt@prattattorneys.com prattattorneys.com RAGGHIANTI FREITAS LLP Community Association Law, Construction Defects & Mediation David F. Feingold, Esq. & Matthew A. Haulk, Esq. Serving Bay Area Communities Since 1986 1101 Fifth Ave., Ste. 100 San Rafael, CA 94901 (415) 453-9433 • Fax (415) 453-8269 dfeingold@rflawllp.com rflawllp.com
Continues on page 17
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2021 LEGAL DIRECTORY, Continued from page 18
RICHARDSON OBER DENICHILO Community Association Law, General Counsel, Assessment Recovery Kelly Richardson, Matt Ober, Robert DeNichilo Throughout California 234 E. Colorado Blvd., Ste. 800 Pasadena, CA 91101 (877) 446-2529 matt@rodllp.com rodllp.com SWEDELSONGOTTLIEB Community Association Law, Construction Defect, Assessment Collection David C. Swedelson, Esq. & Sandra L. Gottlieb, Esq. Los Angeles | Orange County | Palm Desert | San Francisco l Ventura 11900 W. Olympic Blvd., Ste. 700 Los Angeles, CA 90064 (800) 372-2207 • Fax (310) 207-2115 slg@sghoalaw.com lawforhoas.com TINNELLY LAW GROUP Community Association Law Richard A. Tinnelly, Esq. & Steven J. Tinnelly, Esq. Orange County | Los Angeles | Palm Desert | San Francisco | San Diego 27101 Puerta Real, Ste. 250 Mission Viejo, CA 92691 (949) 588-0866 • Fax (949) 588-5993 ramona@tinnellylaw.com tinnellylaw.com WHITE & MACDONALD, LLP COMMUNITY ASSOCIATION LAW, CONSTRUCTION DEFECT LAW Steven M. White, Esq., Rob D. MacDonald, Esq. & James P. Hillman, Esq. COST EFFECTIVE SOLUTIONS BASED ON EXPERIENCE 1530 The Alameda, Ste. 215 San Jose, CA 95126 (408) 345-4000 • Fax (408) 345-4020 info@wm-llp.com wm-llp.com
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WHITNEY PETCHUL APC General Counsel Dirk Petchul, Esq. / Fred Whitney, Esq. 27 Orchard Lake Forest, CA 92630 (949) 766-4700 • Fax (949) 766-4712 info@whitneypetchul.com whitneypetchul.com WOLF, RIFKIN, SHAPIRO, SCHULMAN & RABKIN, LLP Community Association Law Michael W. Rabkin, Esq. 11400 W. Olympic Blvd., 9th Floor Los Angeles, CA 90064 (310) 478-4100 • Fax (310) 479-1422 mrabkin@wrslawyers.com wrslawyers.com
CONSTRUCTION DEFECT ANALYSIS BERDING | WEIL Construction Defect Litigation, General Counsel and Community Association Law Steve Weil | Tyler Berding l Chad Thomas | Andrea O’Toole Walnut Creek | Costa Mesa | San Diego 2175 N. California Blvd., Ste. 500 Walnut Creek, CA 94596 (800) 838-2090 • Fax (925) 820-5592 jjackson@berdingweil.com BerdingWeil.com FENTON GRANT MAYFIELD KANEDA & LITT, LLP Construction Defect Litigation & CID Education Charles R. Fenton, Esq. & Joseph Kaneda, Esq. California & Nevada 2030 Main Street, Ste. 550 Irvine, CA 92614 (877) 520-3455 • Fax (949) 435-3801 cfenton@fentongrant.com fentongrant.com THE MILLER LAW FIRM Construction Defect Analysis & Litigation Thomas E. Miller, Founding Partner, Rachel M. Miller, Senior Partner Serving Homeowners Associations Statewide for Over 40 Years San Francisco | Bay Area | LA | Orange County | San Diego | Inland Empire (800) 403-3332 rachel@constructiondefects.com constructiondefects.com
THE NAUMANN LAW FIRM, PC Construction Defect Litigation William H. Naumann, Esq. Los Angeles | Orange County | San Diego | Riverside | San Bernardino 10200 Willow Creek Road, Ste. 150 San Diego, CA 92131 (844) 492-7474 • Fax (858) 564-9380 elaine@naumannlegal.com naumannlegal.com
RESERVE STUDY FIRMS ASSOCIATION RESERVES Reserve Study Firm Carol Serrano Reserve Studies for Community Associations 6700 Fallbrook Avenue, Suite 255 West Hills, CA 91307 (800) 733-1365 cserrano@reservestudy.com reservestudy.com THE HELSING GROUP, INC. Reserve Study Firm Ryan Leptien Serving All of California 4000 Executive Pkwy., Ste. 100 San Ramon, CA 94583 (925) 355-2100 • Fax (925) 355-9600 reservestudies@helsing.com helsing.com SCT RESERVE CONSULTANTS Reserve Study Firm Mike Graves, RS Finding Solutions, maintaining Communication, and providing Triage P.O. Box 890129 Temecula, CA 92589 (951) 296-3520 • Fax (951) 296-5038 info@sctreserve.com sctreserve.com
VENDOR COMPLIANCE ASSOCIATION SERVICES NETWORK Vendor Compliance David Jeranko Vendor Compliance & Risk Management 24000 Alicia Pkwy., Ste. 17-442 Mission Viejo, CA 92691 (949) 300-3702 • Fax (877) 404-2008 davidj@asn4hoa.com asn4hoa.com
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