SPRING 2022
ELECTION
OVERHAUL YOUR GUIDE ON THE EVER-CHANGING ELECTION LAWS. PAGE 4
ON THE RECORD THE IMPORTANCE OF RECORD RETENTION IN CONSTRUCTION DEFECT CLAIMS. PAGE 6
IT’S A TRIFECTA
THREE CRUCIAL BILLS AFFECTING OUR INDUSTRY. PAGE 8
VIDEO
SURVEILLANCE
SHOULD SECURITY CAMERAS BE REGULATED?
PAGE 10
HANDLING HARASSMENT
WHAT’S LEGALLY ACTIONABLE AND HOW TO PROCESS CLAIMS. PAGE 12
LEGISLATIVE
UPDATE
RENTAL RESTRICTIONS, SOLAR ENERGY, LOT SPLITTING, EMOTIONAL SUPPORT ANIMALS, AND MORE. PAGE 14
Spring 2022
A PRACTICAL REVIEW OF COMMUNITY MANAGEMENT LAW
Your HOA
Banking Specialist
Treasury Services • Web-Based Payment Portal • Integration Services • Operating and Reserve Accounts • Local Lockbox Processing •
2022 CACM Spring Law Journal Editorial Committee Chief Editor Attorney Guest Editor
Fred Whitney, Esq. Whitney | Petchul Michael Kennedy, Esq. Berding | Weil LLP
Spring 2022 Law Journal Committee Members
Supporting Member of
HOA Loans • Placement Services for Excess Reserves •
Megan Hall, Esq. Adams l Stirling PLC
Hamlet Vazquez, MCAM-HR Action Property Management, ACMC
Dyanne Peters, Esq. Delphi Law Group LLP
Cory Gorham, CCAM Canyon Lake POA
Jill Morgan, CCAM Allure Total Management
A Dedicated HOA Department Here For You
Give us a call today 844.489.0999
An archive of past issues can be found under Member
www.HeritageBankofCommerce.bank
Resources at CACM.org.
Member FDIC
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
Community Legal Advisors Inc. COMMUNITY ASSOCIATION ATTORNEYS
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.
General Counsel
Serving San Diego County, Orange County, Inland Empire and Coachella Valley
Toll Free 833.938.1877 AttorneyforHOA.com
• • • • • • •
ADA & DFEH Compliance CC&R & Bylaw Amendments Architectural Matters Contracts & Insurance Elections & Recalls Employment Law Legal Opinions
Assessment Collection • • • •
Timely Status Reports Responsive Paralegals Collectibility Analysis Judicial or Non-Judicial Foreclosures • Money Judgment Lawsuits • Small Claims Assistance • Post Judgment Recovery
2 The Law Journal Spring 2022 | cacm.org
Interested in advertising in CACM’s Law Journal? Reach out to us at marketing@cacm.org
Follow @CACMchat
Ahhh, springtime, when a community manager’s thoughts turn to…elections, lot splitting, document retention, and harassment. Just kidding! Kind of… Every year brings important new revisions and additions to the Davis-Stirling Act, and 2022 is no exception. This issue’s authors include numerous knowledgeable and prominent attorneys from all over California, and in this issue, you will find updates about new laws that will impact you and the associations that you manage. Some of these new laws clarify existing requirements, and some are intended to formalize processes that have evolved during the ongoing COVID-19 pandemic or are intended to address housing affordability in our state. In addition to the important information provided in this issue about new legislation, we have some very helpful information about best practices for associations to protect themselves through record retention and maintenance
“Being a community manager is a challenging role with a lot of moving targets”
practices, and those faced with harassment situations. Community managers and associations are well served by thinking through and potentially adjusting best practices before being faced with challenges and may want to seek input from either their general counsel or specialized counsel to who focus on the different types of unique challenges that our associations are faced with. The Editorial Committee would like to thank all of these authors for their insightful and informative take on these important issues and developments. As you know too well, being a community manager (or for that matter, a board member) is a challenging role with a lot of moving targets. Thanks for taking the time to stay informed amid all of the temptations of springtime!
Michael Kennedy, Esq., is a partner in Berding | Weil LLP’s Costa Mesa office, and he specializes in construction defect claims.
cacm.org | The Law Journal Spring 2022 3
Election Overhaul,
Again!
By Karen St. Onge, Esq.
WHAT YOU NEED TO KNOW. In 2019, the passage of Senate Bill 323 sent associations scrambling to adopt election rules that complied with the new laws before their next election. Well, get ready to scramble again. On January 1, 2022, numerous laws go into effect that change how residential common interest development association elections must be noticed and conducted resulting in out-of-date election rules and management procedures. Here is what managers need to know.
4 The Law Journal Spring 2022 | cacm.org
New Prerequisites for Uncontested Elections Effective January 1, 2022, all associations, regardless of size, must comply with detailed prerequisites set forth in Civil Code section 5103 before a board may declare the candidates in an uncontested election elected without holding a regular election with balloting known as “election by acclamation” (Civil Code §5103.). The prerequisites for an election by acclamation are as follows:
1. A regular election for board directors
was held by secret ballot within the prior three years. The three-year time period is calculated from the date ballots were due in the last full election to the start of voting for the proposed election (Civil Code § 5103(a).).
2. The association complied with the notice, and nomination procedures set forth in Civil Code section 5103(b) through (d).
3. The Inspector of Elections determined that the number of qualified candidates is not more than the number of vacancies on the board (Civil Code § 5103.).
4. The agenda for the open board meeting
at which the board considered declaring the qualified candidates elected by acclamation included the name of each qualified candidate (Civil Code § 5103(e).).
Given the number of prerequisites, it is recommended that associations amend their election rules to incorporate the new laws, so they have a reliable roadmap to follow. Below are some of the key changes to be aware of when planning your next director election if there is a chance it will be uncontested: INDIVIDUAL DELIVERY Call-for-Candidates cannot be announced in a newsletter or posted at the property (i.e., by General Notice); rather, those notices must be sent by “individual delivery.” Also, beginning in 2023, a new definition of “individual delivery” goes into effect, which is discussed below (Civil Code § 5103(b).). FIRST CALL-FOR-CANDIDATES: The first Call-for-Candidates must be delivered 90 days before the nomination deadline and must include specific information set forth in Civil Code section 5103(b)(1)(A)-(D).
Note: Since regular balloted elections are held a minimum of 60 days after the nomination deadline, an association may need to send out the first Call-forCandidates 5 to 6 months before the scheduled election date. REMINDER CALL-FOR-CANDIDATES A reminder Call-for-Candidates must be delivered between 7 and 30 days before the nomination deadline and must include specific information set forth in Civil Code section 5103(b)(2)(A-E). RESPONSE TO NOMINATION Within 7 business days of receiving a nomination, the association shall, in writing or email: (1) acknowledge receipt of the nomination; and, (2) advise the nominee whether they are qualified to run. A disqualified nominee must be provided the basis for the disqualification and the procedure for appealing the disqualification (Civil Code § 5103(c)(1)-(3).). Note: Since the Inspector of Elections must determine if an election is uncontested, an association may want nominations to be sent to the IOE as well as the manager.
Changes to How and When Election Notices Are Sent INDIVIDUAL DELIVERY As mentioned above, the definition of “Individual Delivery” has been amended but does not go into effect until January 1, 2023. (Civil Code §4040.) Beginning in 2023, “individual delivery” means the preferred delivery method specified by the member, which can be mail, email or both. ANNUAL REQUEST FOR PREFERRED DELIVERY METHOD The association’s annual request for members’ delivery addresses has been amended to require: (1) a request for each member’s preferred delivery method for “individual delivery”; (2) other information listed in Civil Code section 4040; and, (3) specific statements set forth in Civil Code § 4041(b)(2). (Note: This annual request should be sent out in 2022 in order to obtain the information needed to comply with the new individual delivery requirements effective January 1, 2023.) GENERAL DELIVERY Beginning January 1, 2022, Civil Code section 4045’s definition of “general delivery” is amended to include posting notices on the association’s website if it
is “designated as a location for posting general notices in the annual policy statement.” PRE-BALLOT ELECTION NOTICE Since 2020, associations have been required to give members notice of an upcoming election at least 30 days before ballots were mailed (“Pre-ballot Notice”). This year, that law was amended so the Pre-ballot Notice only applies to director elections or recalls, and not other elections, such as amending the CC&Rs or passing a special assessment (Civil Code § 5115(b).). TIMING FOR DIRECTOR RECALL ELECTIONS The amount of time an association has to conduct a special member meeting after receiving a member petition, most commonly to recall a director, has been extended from 90 days to 150 days (Corporations Code § 7511(c).). NOTICE OF VIRTUAL-ONLY ELECTION Virtual-only meetings, without a physical location for members to attend, are allowed “if gathering in person is unsafe or impossible” and as permitted by Civil Code section 5450(a). A virtual-only election meeting must be conducted by videoconference with the webcam placed in a location such that members can observe the Inspector of Election counting and tabulating the votes (Civil Code § 5450(d).). The notice of the Virtual-only Election meeting must meet the following requirements: It must be delivered by individual delivery, not general delivery, if it is the first such virtual-only meeting notice for the particular emergency (Civil Code § 5450(b)(1).). If mail is impossible due to the emergency, then email is allowed if the member has consented to email. (Civil Code § 5450(c).) It must include clear technical instructions on how members can participate by videoconference. (Civil Code § 5450(b)(2)(A).)
and tallying votes (e.g., as opposed to the association’s manager) (Civil Code §5105(a)(6).). A “candidate registration list” now includes the name and address of the candidate (Civil Code §5105(a)(7).). A nominee who has delinquent assessments must now be in compliance with a payment plan in order to qualify as a candidate, as opposed to just having entered a payment plan (Civil Code § 5105(d)(2).). The disqualification of a nominee based on their impact on the association’s “fidelity bond coverage” has been amended and replaced with “insurance coverage” instead (Civil Code § 5105(c)(4).).
Election Rules May Need to Be Amended An association’s elections rules may need to be amended to comply with these recent changes in the law and to have a single reliable document that accurately reflects the election laws the association must follow. Failure to comply with the election laws can subject the election results to a legal challenge. In addition, budgets may need to be adjusted to reflect the potential additional cost of updating election rules, more frequent balloted elections, mailing election notices, and the expanded role of an Inspector of Elections.
Associations should consult with legal counsel to determine if any amendments to their governing documents are required or recommended in response to this new legislation.
It must include a telephone number and email address for technical support before and during the meeting. (Civil Code § 5450(b)(2)(B).)
Miscellaneous Clarifications An Inspector of Elections can only appoint another “independent third party” to assist with verifying signatures, counting ballots
Karen St. Onge, Esq., practices community association law with Chapman & Intrieri, LLP in their Alameda, California office.
cacm.org | The Law Journal Spring 2022 5
HOA Records: THE GUIDING PIECE IN CONSTRUCTION DEFECT LITIGATION
C
ommunity managers are very aware of the records that homeowners’ associations must retain to comply with the Davis Stirling Act. A topic of understandably less attention, records retention also plays a critical role in many other contexts for homeowners’ associations, including in construction defect claims. This article focuses on record retention best practices in the context of construction defect claims. Ensuring relevant records are preserved in a favorable manner will help community managers protect their young communities and minimize distractions commonly employed by developers’ defense counsel in defect claims.
6 The Law Journal Spring 2022 | cacm.org
WHY ARE ASSOCIATION RECORDS IMPORTANT? Construction defect claims for new projects in California are governed by Title 7 aka The Right to Repair Act (Civil Code § 895 et seq.). Title 7 establishes a broad range of performance standards for newly built communities and holds the developer liable to the property owners (either the homeowners’ association or unit owners) when a performance standard is violated. In exchange for developers’ compliance with the performance standards, Title 7 precludes property owners from making many types of claims usually available when dealing with property damage (like negligence.) Title 7 lists the defenses available to a developer when defending against a Title 7 violation claim (Civil Code § 945.5.). Since there are limited defenses available to a developer, and many of the listed defenses rarely apply to a homeowners’ association’s claim (like a violation due to an “unforeseen act of nature” or a violation being subject to a valid release), the focus of a developer’s defense counsel is highly predictable. The two available defenses that typically become contentious are: (1) A violation caused by the property owner’s “unreasonable failure to minimize or prevent those damages in a timely manner”; and (2) A violation caused by the property owner’s “failure to follow the builder’s or manufacturer’s recommendations, or commonly accepted homeowner maintenance obligations”. A developer’s defense counsel will look to a homeowners’ association’s records trying to find support for those two common defenses. Thus, it is important for community managers with young multi-family projects to understand what records may be relevant to those two common defenses.
BOARD OF DIRECTORS MEETING MINUTES Both the Open Session and Executive Session meeting minutes of a board of directors are usually the starting point when a developer’s defense counsel looks to support one of the permitted Title 7 defenses. While Executive Session meeting minutes
Only attorney-client privileged, or certain private information (like sensitive financial information), may be redacted in the Executive Session meeting minutes before being provided to the developer’s defense counsel. Sometimes, community managers mistakenly presume that Executive Session meeting minutes are protected in all circumstances, and thus the content can never be used against a homeowners’ association. That is not true and extra care is required when drafting Executive Session meeting minutes since the contents may be disclosed in a lawsuit or arbitration. A developer’s defense counsel is looking for any evidence in the meeting minutes that may support either a lack of maintenance or inspection defense. For example, when meeting minutes reference complaints about construction conditions, complaints about maintenance vendors, a board of director’s failure to approve vendors’ maintenance proposals, a board of director’s decision to change maintenance vendors, or similar types of critical entries, a developer’s defense counsel will try to seize upon such in hopes of supporting a permitted defense. It is often difficult to remember these discussions years down the road when a defect claim is pending, and thus, it is important for community managers to carefully draft minutes to avoid any appearance of board of directors’ inaction. A community manager should consider including the board of directors’ response to such situations in the minutes so it is clear that appropriate action was taken. Otherwise, it may be wrongly interpreted that the board of directors had knowledge of certain conditions and failed to timely take remedial action or failed to timely inspect portions of the project, thereby potentially supporting a permitted Title 7 defense.
INSPECTION, MAINTENANCE, AND REPAIR RECORDS
inspections and maintenance completed consistent with the timing and process specified in the manual, and to regularly provide written reports to the board of directors of such undertakings. Some manuals include a checklist for the inspection schedule and can be used to easily document compliance. If no checklist is included, it is advisable to create and use one for consistent reporting and records keeping. Inspection and maintenance reports from vendors for specialized areas of the manual should also be regularly provided to the board of directors. Vendor contracts should require that written reports be provided after work is completed so appropriate records are preserved. Following this process will eliminate a developer’s defense counsel from making a case that the homeowners’ association has failed to follow the manual’s protocols. These same recommendations should also be followed when vendors complete work consistent with the homeowners’ association’s reserve study or when other project repairs are required.
EMAILS AND WORK REQUESTS Similar procedures should be followed for any emails and work requests submitted to the community manager. Any inspection, maintenance, or repair requests should be maintained and responses to the same should be documented (and reported to the board of directors) to also avoid an appearance of inaction which the developer’s defense counsel could use to support a defense based upon failure to act or noncompliance with the manual. Understanding the importance of the records discussed in this article, and following the above recommended procedures, will help protect young multi-family projects and ensure that construction defect claims are not compromised by the limited Title 7 defenses available to developers.
Developers typically draft a lengthy homeowners’ maintenance manual for newly built multi-family projects. Those manuals specify the recommended inspection and maintenance protocols for a project’s systems and components, including those that the homeowners’ association and individual owners are required to maintain.
are protected from members’ inspection under the Davis Stirling Act (see Civil Code § 5215), they are discoverable in a lawsuit or arbitration, so a developer has a right to obtain those minutes under Code of Civil Procedure § 2017.010.
It is critically important that community managers familiarize themselves with the manual and ensure that the inspection and maintenance protocols are timely followed. To document compliance with the manual, it is the best practice to keep records of all
Aaron Ehrlich, Esq., is a Litigation Partner at Berding & Weil LLP and has practiced construction defect litigation for 15 years.
cacm.org | The Law Journal Spring 2022 7
With the 2021 legislative session now officially closed for business, it’s time to review some of the key bills that will impact life in our beloved community associations. Some are fairly benign, and some appear to be great ideas in theory, but add new requirements.
1
AB-502 (Davies)
Election by Acclamation
Prior to its passage, the law permitted director nominees to be considered elected by acclamation if (1) the number of director nominees did not exceed the number of vacancies to be elected; (2) the association included 6,000 or more units; (3) the association provided individual notice of the election at least 30 days before the close of the nominations; and (4) the association allowed all candidates to run if nominated.
3
Here are three to be aware of:
Several of the new laws involve revisions to election law, with some cleanup legislation making a few key changes to be aware of. After a hard-fought battle with various homeowner groups opposing its passage, CACM’s input was instrumental in helping this bill, which provides for election “by acclamation” (without the need for a vote), to get passed.
This bill eliminates the prior 6,000-unit requirement for acclamation and expressly provides for acclamation in Section 5103 of the Civil Code. Sounds good, right? Unfortunately, as with many bills that appear attractive on the surface, there is more to it when the onion gets peeled. This bill actually adds an additional 90 days to the election process (!), and requires another reminder notice 7-30 days prior to the election. This changes the timeline for elections affected by the passage of Senate Bill 323 a few years back.
Crucial Bills Affecting Community Associations In 2022
8 The Law Journal Spring 2022 | cacm.org
Both the first 90-day notice and the reminder notice must include specific information, and the first notice requires a “heads up” statement that if there are fewer candidates than there are vacancies, board may vote to fill the vacancies by acclamation. The reminder notice must provide a similar statement as well as a list of qualified candidates. Next, within 7 days of a person submitting a nomination, the association must confirm receipt and whether the candidate is qualified or disqualified. If they are disqualified, a reason must be given along with the procedure for appeal. CACM and other organizations supporting the HOA industry voiced concern about the short timeline to determine if a candidate is disqualified, something to be revisited in 2022. See related article in this issue on page 4 about election overhauls for more details.
SB-391 (Min)
2
Virtual Meetings During Emergency
Another bill that appears to have its heart in the right place is Senate Bill 391, which is an urgency measure (so, it’s effective immediately), but also adds specific requirements that boards must follow.
The bill allows meetings to be conducted entirely virtually, by teleconference (defined to include videoconferences) without the requirement of a physical location for the meeting as needed if certain requirements are met, but only during a state of emergency. The idea, of course, was to capitalize on the technology community association members have enjoyed since the era of Zoom meetings began due to the pandemic. Most notably, the level of participation in homeowner association meetings and official business showed
a marked increase when members were permitted to attend remotely. For this reason, at first, Senator Min and the proponents of this bill advocated for teleconferencing to be available for all meetings going forward. However, the bill was amended to remove the physical location requirement and allow remote meetings only if gathering in person is “unsafe or impossible,” a state of emergency having been declared by the governor, the federal government, or a local governing body. The amendment also adds some specific conditions to the ability for boards to conduct meetings remotely. First, notice of the first meeting to be conducted in this manner must be delivered by individual delivery. It must contain clear instructions on how to participate by teleconference, as well as contact information for technical assistance should there be an issue connecting. Be aware that roll call votes are required for these meetings, and that any meeting where ballots are counted and tabulated must be on video for all to see. The camera must also be positioned to allow members to witness the inspector of elections to count votes.
SB-432 (Wieckowski)
3
term limits were not specifically discussed, and members could arguably be eligible for nomination again despite having served a full term. As of January 1, 2022, SB-432 explicitly authorizes term limits, so that associations may disqualify an individual if they have served the maximum number of terms allowed under the governing documents. The bill further clarifies that felony candidate disqualification applies if the felony compromises the association’s ability to secure any kind of insurance, not just fidelity as stated in the existing law, and eliminates the pre-ballot notice requirement for non-director elections. Finally, this bill carves out an exception for voting driven by member petition (i.e., recall elections). When SB 323 changed the dates from 35 to 90 days for recalls, but allowed up to 120 days for new directors, a gap was created; now, the recall meeting dates are 35 to 120 days to eliminate that gap and allow for both elections to happen at the same time.
Consult your community association attorney for more details on these and other bills that should concern boards and community managers.
Election Cleanup Measure (Term Limits, Election Procedures)
Finally, another bill that attempts the clean up some of what SB-323 wrought is Senate Bill 432, sponsored by Senator Wieckowski. After the SB-323 election bill was passed, HOAs were authorized to disqualify individuals from nomination for the board of directors for certain specific reasons, such as failure to be a member for at least a year, assessment arrears, and joint ownership with another member; however,
Rob Ward, Esq., is a Senior Attorney with Adams-Stirling PLC advising community associations from the firm’s San Diego office. Ward has represented HOAs throughout California both as a litigator and corporate counsel for over 23 years.
cacm.org | The Law Journal Spring 2022 9
SECURITY CAMERAS
Who’s Watching BY MICHE L
LE COPEL
AND, ESQ .
ASSOCIATION CAMERAS
Let’s face it…security cameras are everywhere and if you are in public, you can be sure they are watching you. In residential neighborhoods, personal security cameras such as Ring cameras are becoming more common. Boards are often faced with questions relating to what cameras may be installed by the association or owners and how the use of security cameras should be regulated. 10 The Law Journal Spring 2022 | cacm.org
Association cameras must be installed with views directed to areas where there is not a reasonable expectation of privacy by people who may be recorded. For example, recording the pool area is fine; recording within changing rooms or restrooms is not. As discussed below, boards should also adopt a policy that disclaims any “security” provided by the cameras, explains how long recordings will be kept, and how the recordings will be used. The board should also consider whether to install signs advising that cameras are present. It is better for members to know the location of cameras and that they are being recorded, because this clearly conveys to members that they should not have an expectation of privacy in the area being recorded. Further, signage indicating the presence of cameras may deter criminal activity or violations of the association’s governing documents. Whether to monitor the cameras can be a tricky question. Some associations delegate maintenance of the camera system and monitoring to a security company. Others allow monitoring by board members. Still, others provide a live feed on the association’s secure website. This may lead to stalking behavior or worse, to potential harassment, especially if all members are permitted to view the recordings.
g
You? Further, it is unlikely that a crime in progress will be stopped because the cameras are monitored. In addition, monitoring the cameras may lead to potential claims against the association that the cameras were negligently monitored, thus a crime was able to occur. This is potential liability the association should seek to avoid, therefore systems that provide access to recordings without live monitoring are preferred.
RING CAMERAS These cameras typically record the area in front of an owner’s front door and the view may include the entry to an opposite neighbor’s unit, a sidewalk, the street, or a neighbor’s home across the street. Owners arguably have no reasonable expectation of privacy in these public areas typically located within the common area. On the other hand, an owner’s camera directed into a person’s window or back yard would likely violate that person’s reasonable expectation of privacy and should not be permitted. The association should develop rules for how and where these cameras can be installed to address these issues. A common question is whether Ring cameras should be allowed to record audio. In California, wiretapping laws under Penal Code § 632 require that you receive consent from a person to record their voice. The law also states it is illegal to record a “confidential communication,” which is any communication meant to be heard only by the parties to the conversation. However, there is no reasonable
expectation of privacy in a conversation being held in public, no matter how much a person hopes they are not being overheard. While an owner may consider posting a notice near their Ring camera that audio recording is in progress to avoid any potential liability under the wiretapping laws, this is a concern for an owner and not an association. Generally, unless an owner is deliberately using a recording for exploitive or commercial purposes, there is little risk of being found in violation of these laws. Boards should also consider whether recordings from Ring cameras may be requested by the board to assist with enforcement actions. This right should be addressed in the association’s security camera policy.
SECURITY CAMERA POLICY A security camera policy is a must if the association is going to install its own cameras and/or allow members to install cameras. With respect to the association’s cameras, the policy should clearly state that the presence of cameras does not guarantee the security or safety of any person and (if applicable) is not monitored live.
ALL CAMERAS MUST HAVE VIEWS THAT DO NOT INVADE A PERSON’S REASONABLE EXPECTATION OF PRIVACY. architectural application and include architectural guidelines regarding installation of the cameras. For example, the board may implement guidelines regarding the size, color, and permissible location of cameras. The board may also include a requirement that the camera view is subject to inspection by the board or architectural committee after the initial installation as well as periodically thereafter to confirm the scope of the view. Finally, the board may consider a requirement that owners post disclosures for any Ring camera that records audio. A thorough camera policy will ultimately protect the association from potential liability and should be drafted with the assistance of legal counsel.
The policy should further indicate that the association’s recordings do not qualify as “association records” and that they will be produced only in response to a lawful subpoena or request by the police. Further, there should be full disclosure regarding who has access to the cameras and recordings. All cameras must have views that do not invade a person’s reasonable expectation of privacy. The policy, as it relates to private cameras, should require the submission of an
Michelle Copeland, Esq., of Delphi Law Group, LLP specializes in community association law and has been in the industry for four years.
cacm.org | The Law Journal Spring 2022 11
Social Media, Free Speech and Harassment Social and electronic media have had many positive impacts for associations (and for trees.) Increased civility is not among them. Trolling, flaming, gaslighting, cyberbullying, and similar forms of digital harassment have become all too common.
By David Feingold, Esq. & Matthew Haulk, Esq.
Handling Harassment 101
Radical changes brought on by social media and electronic communications have resulted in an exponential increase in harassment claims in community associations. Often, the community manager is the first line of defense (if not the target) and the person whose action or inaction can escalate or defuse the situation. This article provides the community manager with a brief summary of what legally actionable harassment is, and is not, and suggests a three-part process for handling harassment claims.
12 The Law Journal Spring 2022 | cacm.org
When it comes to aggressive communications, the most common request we receive when the aggressor targets management or volunteer leaders is to send a cease and desist letter, demand a retraction from the author, threaten a lawsuit, or try to scare the aggressor away. Anything to make it stop. It’s not so easy. The first step is to determine whether or not the offensive behavior falls within the legal definition of harassment. Threats of violence or physical harm are per se harassment. Those are easy calls. Most often, however, the alleged harassment falls into the vast gray area where free speech rights and actionable harassment intersect. The legal definition of harassment in California includes any course of conduct that seriously alarms, annoys, or harasses, which serves no legitimate purpose, and which causes substantial emotional distress. It can be one (extreme) event or multiple events and may be via emails, texts, telephone calls, or in-person behavior or statements. However, constitutionally protected speech is not harassment. Even speech that all (ok, most) would agree is rude, obnoxious, and false may be protected. Community associations, as quasigovernmental entities, must respect the free speech rights of interested parties in the same way your local town council must. Damon v. Ocean Hills Journalism Club (2000) 85 Cal.App.4th 468, 479. Community managers can help themselves and the volunteer directors they work with by understanding the issues and objectively evaluating the harassment claim before responding. The remainder of this article provides what we think is a useful three step process to evaluate harassment claims.
Think Like a DAD: Document, Analyze, Decide While you may or may not have a fatherly figure that you see as a role model, think about what the best stereotypical “DAD” would do when confronted with a difficult issue. (No disrespect to Moms – DAD just happened to work with the mnemonic device.) DOCUMENT First, document the harassing behavior. Are there emails? Blog, vlog, or web posts? Nextdoor posts? Was it a single incident or a series of incidents? Was it nonverbal conduct or one or more face to face confrontations, and if so, are there witnesses? Any video or audio? Has the target of the attack kept a diary of events? All of this is critical. ANALYZE Next, analyze the harassment. What category of aggressor and target does it fall into? Is it Neighbor vs. Neighbor, Member v. Vendor, Member vs. Director, Director v. Member, Director vs. Community Manager, etc.? This is a critical step, and while each may require investigation and/or action, each category of aggressor v. target may warrant a different response. For example, claims of harassment based on a person’s protected status require heightened due diligence. The Fair Housing Act requires that claims of harassment on the basis of race, color, religion, national origin, sex, familial status, and disability, be promptly investigated, and if warranted, that steps be taken to attempt to end the harassment (Code of Fed. Reg. §100.7(a)(1) (iii).). Association employees are entitled to protection from harassment under California’s Fair Employment and Housing Act (FEHA), and this obligation is broad enough to apply to non-employees in certain circumstances, such as volunteers and management staff. What is the context in which the alleged harassment occurred? Was it related to the emotionally charged association business, such as a director election or a special assessment vote, or was it unrelated to association business? Now that you have documented and analyzed the claim, you are in a position to help the board decide what to do.
DECIDE The first step in making a decision is to brainstorm all of the available options, starting with informal steps to defuse the situation, such as: Do Nothing You know what they say about wrestling with a pig. Doing nothing may be the best decision.
Listen and Act There are times when the act of listening, and perhaps taking some specific action to eliminate the source of the frustration, will work. Social Media Terms of Service While various federal laws protect internet service providers and social media platforms from liability for content, often lodging a formal complaint that the terms of service were violated can result in an offending post, such as a Yelp review, to be removed. Similarly, the moderators of Nextdoor forums may also restrict harassing speech.
Address the Membership There are times when harassment is the result of fear or uncertainty. Sending out association wide updates on contentious issues often can specifically respond to issues raised by an aggressor (we like FAQ’s) and often reduces the harassing behavior and builds community. Providing Before formal action is taken, we forums to allow members to vent also recommend consulting with counsel, as helps lower the temperature. formal action can backfire if not justified. Personal Outreach Often the community manager (if not the target) is in a position to reach out to the aggressor as well as the target and deescalate a situation. It can also be an uninvolved board member, or other third party. Be creative.
Options for formal action may include offering internal dispute resolution (IDR), holding a disciplinary hearing, an attorney cease and desist letter, a request for resolution (ADR), or in serious cases, seeking a temporary restraining order and injunction.
What Do We Take Away From This? Regrettably, we often conclude that the speech or behavior, while ugly and often unfounded, falls within the individual’s constitutionally protected free speech rights. Working with community associations has always required a thick skin and solid diplomacy skills. Today, those two attributes are more important than ever before.
David F. Feingold, Esq., and Matthew A. Haulk, Esq., practice community association law in the San Francisco Bay Area and are partners in the Marin County law firm of Ragghianti Freitas LLP.
cacm.org | The Law Journal Spring 2022 13
legislative update
BY BRIAN D. MORENO, ESQ. & MEIGAN EVERETT
Here are the latest updates on bills affecting rental restrictions, solar energy systems, lot splitting, discriminatory clauses, and emotional support animals in HOAs. AB-1584 Rental Restrictions AB-1584 amended Civil Code Section 4741, which was originally adopted in 2019 and required community associations to amend rental restrictions within the CC&Rs that did not comply with the statute. The bill extended the deadline to complete the amendment to July 1, 2022. It is important to note that AB-1584 did not extend the obligation to comply with the prohibition on rental restrictions cited in this statute. Since January 1, 2021, associations have been and still are prohibited from enforcing restrictions that conflict with the statute. With the extension, the Legislature eased compliance by expressly stating that a board of directors may approve the amendment without a membership vote if it follows the new procedure provided. This includes providing general notice of at least 28 days before the meeting to approve the amendment, sending the text of the amendment and a description of the purpose of the amendment to the membership, allowing members 28 days to comment, reviewing the comments, and adopting the amendment at an open meeting of the board.
14 The Law Journal Spring 2022 | cacm.org
In order to utilize this procedure, no other change may be made to the governing documents other than restating the rental restrictions to comply with the statute. If other changes are proposed, a membership vote is required. Under the existing Davis-Stirling Act, unreasonable restrictions in CC&Rs on constructing ADUs are prohibited. This law expands the prohibition on unreasonable restrictions to any deed, contract, security interest, or other instrument affecting the transfer or sale of any real property. And, in addition to associations being subject to the restriction, an owner cannot agree to restrict his or her property in this manner when transferred to a third party.
AB-1124 Solar Energy Systems Existing law provides for solar easements, defined as “the right of receiving sunlight across real property of another for any solar energy system.” This bill expands the definition of “solar energy system” to include stand-alone features adjacent to buildings and allows for them to be on adjacent or contiguous lots.
Solar easements should be made in writing so that the terms and scope of the easements are clearly defined. Otherwise, it should be noted that there may be rights or defenses that could be asserted, including an equitable easement and/or a prescriptive easement, depending on the circumstances. These rights are now extended to freestanding solar systems, such as racks or solar support structures. In addition, the new law caps the fees charged by municipalities for the installation permits, etc. Any 3+ unit property would be subject to the commercial rates, while 1 and 2 units are subject to residential rates.
SB-9 Lot Splitting This bill requires municipalities to approve ministerially (aka over-the-counter) lot splitting in single family residential zones to allow for 2 units per lot. While most CC&Rs contain clauses that prohibit lot splitting, community associations should review their documents to ensure they contain adequate restrictions that would prevent lot splitting and other similar transactions that may be out of character for the community. Without a proper clause in the CC&Rs, the board would lack the authority to prohibit a lot split. Further, while this bill requires a municipality to approve 2 units over the counter, it does not prohibit them from approving more. Lot splitting can put a strain on the association’s infrastructure, including utility services such as electrical services, water and sewer lines, and even internet wiring. Associations may want to consider this impact and transfer financial liability to homeowners that are seeking these types of modifications, including imposing conditions that would require utility service upgrades and other infrastructural upgrades to accommodate the additional usage.
AB-1466 Discriminatory Clauses in CC&Rs This new law allows anyone to file a request for Restrictive Covenant Modification to remove discriminatory clauses from association CC&Rs. Civil Code Section 4225, effective since January 1, 2014, already required community associations to remove these clauses. Since many have not, this bill extends the power to others. Whoever files the request for modification has the opportunity to remove the clause in its entirety. The request, along with the revised text, is submitted to the county attorney, who must review it within a three-month period and decide whether to record the modification or not.
Brian D. Moreno, Esq., is an experienced litigator, community association attorney, and has practiced common interest development law since 2003.
It also requires an escrow agent, title company, real estate agent, etc. to notify a buyer when they have knowledge of such a clause within CC&Rs involved in a purchase transaction.
AB-468 Emotional Support Animals While this bill does not directly impact community associations, it does provide a tool for evaluating requests for accommodation involving a service or emotional support animal. AB-468 established guidelines for doctors and clinicians, requiring them to be licensed, to establish a relationship with a patient for over 30 days, and to conduct an evaluation for the need for the emotional support animal before writing a letter on the client’s behalf in support of an emotional support animal.
Meigan Everett joined SwedelsonGottlieb as its client relations director in 2018 after working as a community manager for many years and opening her own property management company in 2006.
Community associations can require any letter offered with a request for accommodation for an emotional support animal to include license number, a statement that the clinician/doctor – patient relationship has been established for at least 30 days, and that an evaluation was conducted that established the need for the support animal.
cacm.org | The Law Journal Spring 2022 15
2021-2022 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 www.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 www.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 www.cahoalaw.com
16 The Law Journal Spring 2022 | cacm.org
UNITED TRUSTEE SERVICES Trusted Partners In Assessment Collections Lisa E. Chapman HOA Assessment Collection Services 696 San Ramon Valley Blvd., Ste. 353 Danville, CA 94526 (925) 855-8554 • Fax (925) 855-8559 lisa@unitedtrusteeservices.com www.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 www.hoaattorneys.com BERDING | WEIL Construction Defect Litigation Steven Weil, Tyler Berding, Chad Thomas, Daniel Rottinghaus, Andrew Baugh, Paul Windust Walnut Creek, San Diego, Orange County, Sacramento 2175 North California Blvd., Ste. 500 Walnut Creek, CA 94596 (800) 838-2090 • Fax (925) 820-5592 jjackson@berdingweil.com www.berdingweil.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 www.attorneyforhoa.com DELPHI LAW GROUP, LLP Community Association Law, General Counsel, Litigation, Assessment Collections James McCormick, Kyle Lakin, Christina DeJardin, Zachary Smith Full Service Law Firm Serving All of Southern California 1901 Camino Vida Roble, Ste. 100 Carlsbad, CA 92008 (844) 433-5744 • Fax (760) 820-2696 info@delphiLLP.com www.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 www.epsten.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 www.fiorelaw.com FLANAGAN LAW, APC General Counsel TIM FLANAGAN, ESQ. San Diego l Orange County l Coachella Valley l Inland Empire 8880 RIO SAN DIEGO DR., STE. 800 SAN DIEGO, CA 92108 (619) 489-1340 TIM@FLANAGANHOALAW.COM WWW.FLANAGANHOALAW.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 www.gghoalaw.com
THE NAUMANN LAW FIRM, PC Construction Defect Litigation Construction Defect Analysis William Naumann l Elaine Gower San Diego l Orange County l Los Angeles l Riverside l San Bernardino 10200 Willow Creek Road, Suite 150 San Diego, CA 92131 (858) 522-0763 • Fax (858) 564-9300 elaine@naumannlegal.com www.naumannlegal.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 www.HickeyAssociates.net
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 www.prattattorneys.com
HUGHES GILL COCHRANE TINETTI, P.C. 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 www.hughes-gill.com LOEWENTHAL, HILLSHAFER & CARTER, LLP Construction Defect Litigation Robert Hillshafer | David Loewenthal Los Angeles, San Luis Obispo, Santa Barbara, Ventura 5700 Canoga Avenue, Suite 160 Woodland Hills, CA 91367 (866) 474-5529 • Fax (818) 905-6372 info@lhclawyers.net www.lhclawyers.net 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 l Bay Area l LA l Orange County l San Diego l Inland Empire (800) 403-3332 rachel@constructiondefects.com www.constructiondefects.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 www.rflawllp.com RICHARDSON OBER DENICHILO LLP Community Association Law, General Counsel, Assessment Recovery Kelly G. Richardson, Matt D. Ober, Robert M. DeNichilo Throughout California (877) 446-2529 matt@rodllp.com www.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 www.lawforhoas.com
cacm.org | The Law Journal Spring 2022 17
2021 LEGAL DIRECTORY, Continued from page 17
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 www.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 www.wm-llp.com WHITNEY PETCHUL APC Community Association Attorneys Fred T. Whitney, Esq. l Dirk E. Petchul, Esq. From Inception To Build-Out And Beyond 27 Orchard Rd. Lake Forest, CA 92630 (949) 766-4700 • Fax (949) 766-4712 info@whitneypetchul.com www.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 www.wrslawyers.com
CONSTRUCTION DEFECTS
BERDING | WEIL Construction Defect Litigation Steven Weil, Tyler Berding, Chad Thomas, Daniel Rottinghaus, Andrew Baugh, Paul Windust Walnut Creek, San Diego, Orange County, Sacramento 2175 North California Blvd., Ste. 500 Walnut Creek, CA 94596 (800) 838-2090 • Fax (925) 820-5592 jjackson@berdingweil.com www.berdingweil.com
18 The Law Journal Spring 2022 | cacm.org
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 www.cnilawfirm.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 www.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 l Bay Area l LA l Orange County l San Diego l Inland Empire (800) 403-3332 rachel@constructiondefects.com www.constructiondefects.com
ELECTION ADMINISTRATION THE INSPECTORS OF ELECTION Providing Superior Election Support for California HOA’s Since 2006 Kurtis Peterson Completely Independent Full-Service Election Provider 2794 Loker Ave. W., Ste 104 Carlsbad, CA 92010 (888) 211-5332 • Fax (888) 211-5332 kurtis@theinspectosofelection.com www.theinspectorsofelection.com
LIBERTY HOA ELECTION SERVICES, LLC Inspector of Election We Make Association Voting Management Easy 1900 Camden Avenue San Jose, CA 95124 (408) 482-9659 www.hoaelection.com
RESERVE STUDIES
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 www.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 www.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 www.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 www.asn4hoa.com
