Journal_10_03 by Echo

March 2010

A Journal for California Community Association Leaders

echo-ca.org

2009 Statutory and Case Law ALSO INSIDE THIS ISSUE:

• The Joys of Stucco • Not In My Neighbor’s Backyard • VOCs—Clearing the Air

Change Service Requested ECHO 1602 The Alameda STE 101 San Jose, CA 95126

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Contents The Joys of Stucco —page 24

Statutory and Law Case Update—2009

The Joys of Stucco

Executive Council of Homeowners, Inc.

There are many misconceptions about stucco that can lead associations to make costly mistakes by replacing stucco. This article dispels the myths about stucco and makes the recommendation to repair stucco when problems appear.

1602 The Alameda, Suite 101 San Jose, CA 95126 408-297-3246 Fax: 408-297-3517 www.echo-ca.org info@echo-ca.org

Not In My Neighbor’s Backyard

Office Hours: Monday–Friday 9:00 a.m. to 5:00 p.m.

VOCs—Clearing the Air Regulations are limiting the amount of Volative Organic Compounds (VOCs) in paint. Lower VOCs is good for the environment, but this also means paints with reduced performance. The author discusses the issues regarding these new paints.

Departments 28 News from ECHO 30 Directory Updates 34 ECHO Bookstore

36 Events Calendar 38 ECHO Volunteers 40 Letters to the Editor

Board of Directors and Officers President David Hughes Vice President Karl Lofthouse Treasurer Diane Rossi Secretary Dorothy Kopczynski Directors Paul Atkins John Garvic Robert Rosenberg Richard Tippett Steven Weil

Jerry L. Bowles David Levy Kurtis Shenefiel Wanden Treanor

Executive Director Oliver Burford Communications Coordinator Tyler Coffin Legislative Consultant Government Strategies, Inc. Design and Production George O’Hanlon

41 Advertiser Index

ECHO Mission Statement

Statutory and Law Case Update —page 6 March 2010 | ECHO Journal

The ECHO membership list is never released to any outside individual or organization.

41 ECHO Marketplace

On the Cover 4

Acceptance of advertising does not constitute any endorsement or recommendation, expressed or implied, of the advertiser or any goods or services offered. We reserve the right to reject any advertising copy.

The courts were busy with cases involving, or affecting, common interest developments last year. This article provides a brief synopsis of select published decisions from 2009 and major new laws passed by the California Legislature.

Architectural review is serious business for an association board. When owners want to remodel or make additions to their property, how should the board approach the process? This article provides simple answers to this perplexing issue.

The ECHO Journal is published monthly by the Executive Council of Homeowners. The views of authors expressed in the articles herein do not necessarily reflect the views of ECHO. We assume no responsibility for the statements and opinions advanced by the contributors to the magazine. It is released with the understanding that the publisher is not engaged in rendering legal, accounting or other professional service. If legal advice or other expert assistance is required, the services of a competent person should be sought.

The mission of ECHO is to advance the concept, interests and needs of homeowner associations through education and related services to board members, homeowner members, government officials and the professionals in the industry.

In Memoriam George Martin Hidzick

eorge Hidzick served as a member of the ECHO Board of Directors from 1990 to 2002. He was a very active volunteer, distinguishing himself through long service on the Legislative Committee and the Annual Seminar Committee. He was the board expert on complex insurance issues and was the sparkplug for ECHO’s successful campaign with the California Public Utilities Commission to allow homeowner associations to qualify as businesses for the purposes of water rates. George was born on August 17, 1925 in San Francisco. He graduated from Lowell High School before being drafted into the Army in 1943. He proudly served in the Army’s 86th Blackhawk Infantry Division for Combat Operations in Europe and Occupation Duty in the Philippines. After his discharge, he attended the University of California at Berkeley, graduating with a Bachelor’s Degree in Mechanical Engineering. George married his wife Isabel in 1953; they raised three children and celebrated 56 years of marriage this past year.

George began a long career in the insurance industry at the Factory Insurance Association in San Francisco before joining Kemper Insurance as he helped start their Highly Protected Risk Department. He moved to the Chicago area in 1973 to Kemper’s Home Office in Long Grove, IL and retired from the company in 1987. George’s commitment to fire and life safety was recognized in awards by the National Fire Protection Association, National Institute of Building Sciences and as a Fellow with the Society of Fire Protection Engineers. After retirement, George and Isabel returned to the Bay Area. Living in Foster City, George was active in his Condominium Owners Association and was a volunteer at the San Francisco Maritime National Historic Park. He took an active role in raising his grandchildren and spent many days helping with their school and outside activities. George was part of the “Greatest Generation.” He was proud of his service to his country, his profession and most of all, his family. He was a gentleman in every sense of the word and is admired and respected for his kindness, intelligence and selflessness. ECHO Journal | March 2010

March 2010 | ECHO Journal

The courts were busy with cases involving, or affecting, common interest developments last year. What follows is a synopsis of select published decisions from 2009 and major new laws passed by the California Legislature.

By Lise K. Ström, Esq. and Jeffrey A. Barnett, Esq.

Statutory and Case Law Update—2009 he courts were busy with cases involving, or affecting, common interest developments last year. What follows is a brief synopsis of select published decisions from 2009.

on a protected class, such as race, gender, age, or disability.

Cases Ashcraft v. Villas West II of Willowridge Homeowners Association, Inc. [129 S.Ct. 1527 (2009)] Prohibition on Leases. The United States Supreme Court upheld an Indiana state court ruling that an association’s “no-lease” covenant did not violate the Federal Fair Housing Act (“FHA”) because the provision was not arbitrary, was based on legitimate economic concerns, and did not have an actual, significant adverse impact

Birke v. Oakwood Worldwide [169 Cal.App.4th 1540 (2009)] Secondhand Smoke in Common Area. Oakwood Worldwide is an apartment community. While all indoor smoking was banned, smoking was permitted in all outdoor common areas, such as the barbeque areas, pool area, and playground. The young daughter of Birke, a tenant at Oakwood, suffered from asthma and her parents repeatedly asked the apartment owner to limit smoking in the outdoor common area. Ultimately, Birke sued the apartment owner for nuisance. The trial court dismissed Birke’s com-

ECHO Journal | March 2010

plaint, stating that Birke had failed to plead the necessary facts to support a claim of public nuisance. The appellate court, however, reversed the trial courtâ&#x20AC;&#x2122;s decision and remanded the matter back to the trial court for further proceedings. Notably, the appellate court indicated that the apartment owner owed a duty to the resident to keep the premises â&#x20AC;&#x153;reasonably safeâ&#x20AC;? and that the ownerâ&#x20AC;&#x2122;s failure to adopt a no-smoking policy for outdoor common area could constitute a breach of that duty.

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March 2010 | ECHO Journal

Calemine v. Samuelson [171 Cal.App.4th 153 (2009)] Seller Disclosures. Samuelson, the owner of a condominium at Jared Court, sold his unit to the Calemines in 2002. Shortly after the Calemines moved in, the condominium garage flooded. While Samuelson disclosed to the Calemines that the unit had previously experienced water intrusion, Samuelson indicated that the association had made the necessary repairs and that the problem was solved. Further, Samuelson failed to disclose two lawsuits related to the water intrusion problem. In the first lawsuit, Samuelson, other owners, and the association sued the developer alleging construction defects that caused the water intrusion. In the second lawsuit, while Samuelson served on the board of directors, the association sued a flooring company for failing to waterproof affected areas properly. The Calemines sued Samuelson for failing to disclose these lawsuits. The trial court ruled that Samuelson had met his disclosure obligation regarding the water intrusion despite his failure to mention the lawsuits. However, on appeal, the court reversed, stating that there was a triable issue of fact as to whether Samuelsonâ&#x20AC;&#x2122;s disclosures were adequate. Carolyn v. Orange Park Community Association [177 Cal.App.4th 1090 (2009)] Disabled Access to Common Area. Orange Park had a recreational trail system located within its common area that was connected to a larger system of trails maintained by other associations and/or government entities. For numerous years, the trail system had been open for use by anyone, including the general public. However, in 2007, citing safety reasons as well as maintenance costs, Orange Park installed barriers at its trail entry points to prevent vehicular access. Carolyn, a disabled non-resident, who sought to use the trail system by horse-drawn carriage, sued Orange Park, claiming the association was in violation of the Americans with

Disabilities Act (“ADA”) and the California Disabled Persons Act (“CDPA”). The appellate court ruled that the association’s trails were not considered “public accommodations” and were therefore not subject to the ADA or CDPA. The court reasoned that, while the public had an incidental right of access to the trails, there was no evidence indicating that the Orange Park trails were intended to be used by anyone other than the association members, nor did the association encourage public use of its trails. However, the court indicated that there are circumstances where recreational common areas within an association could be classified as a public accommodation, including a pool, park, clubhouse, or trail open to the public for a fee. Lastly, the court stated that it might have reached a different decision if the association had blocked access altogether to its trails. Coronado v. Cobblestone Village Community Rentals [163 Cal.App.4th 831 (2009)] Disabled Access to Common Area. Cobblestone Village is an apartment community. A disabled tenant who required wheelchair access filed a lawsuit against the owner of the complex and the management company for violation of the Unruh Civil Rights Act (“UCRA”) and the California Disabled Persons Act because the owner had failed to install a permanent concrete ramp to provide access between his car and apartment building. The only ramp in the apartment community led to the manager’s office. The appellate court held that the residential portions of the complex were not a public accommodation under the UCRA or CDPA and therefore, there was no legal obligation for the owner (or manager) to install a wheelchair accessible ramp. Costa Serena Owners Association v. Costa Serena Architectural Committee [175 Cal.App.4th 1175 (2009)] CC&R Amendments. Costa Serena, a planned development consisting of seven phases, had a “master” set of CC&Rs plus seven “sub” sets of CC&Rs (one for each phase), all of which were set to expire in 2006. The members of the Architectural Committee favored extending the CC&Rs; however, a coalition of homeowners (“Coalition”) opposed their extension. The Coalition sought to defeat the ARC’s attempt to extend the life of the CC&Rs by challenging the validity of various CC&R amendments, most significantly an amendment that ECHO Journal | March 2010

consolidated all seven phases and made them subject to the single set of “master” unified CC&Rs and eliminated the CC&Rs for each phase. The Coalition argued that the amendments were adopted in a manner inconsistent with the amendment procedure outlined in the CC&Rs. The ARC sought to hold an election of the members, consistent with the unified CC&Rs, to determine whether or not to extend the CC&Rs; but the Coalition obtained a court injunction to prevent the voting process. In response, the ARC recorded a document purporting to extend the life of the CC&Rs, along with exhibits showing each acquiescing member’s written consent. Ultimately, the appellate court held that (1) the CC&R amendments were voidable (not void ab initio), but that the Coalition’s challenge to the CC&R amendments was barred by the statute of limitations, and thus the amendments were valid; and (2) the ARC obtained the necessary membership approval to effect an extension of the unified CC&Rs and that the document, with exhibits, recorded by the ARC met the CC&R amendment requirements.

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Creekridge Townhome Owners Association v. Whitten [177 Cal.App.4th 251 (2009)] Construction Defect/Statute of Limitations. A reroofing project was completed in 1997 at Creekridge Townhomes. A few months after completion, one owner complained about water seepage around her bedroom window caused by the new roof. Other than this complaint, however, there were no problems until 2003, when numerous roof leaks appeared. A subsequent expert examination of the roof indicated that there were many roof defects causing the leaks. The association sued the original roofer in 2004, and the trial court found that the association’s complaint was barred by the statute of limitations. The appellate court, however, reversed the trial court’s decision, finding that the defect was latent, i.e., not apparent by reasonable inspection, and therefore, the applicable Statute of limitations did not start running until the association discovered the defect. The court found that evidence of one owner’s complaint about water leakage in a complex of 61 units in 11 buildings did not give the association reasonable notice that a remedy had to be pursued. Dey v. Continental Central Credit [170 Cal.App.4th 721 (2009)] Delinquent Assessments. Dey, an owner of a timeshare condominium, unsuccessfully sought to bring a class action lawsuit against

Vacation Resorts (the property manager) and Continental Credit (the collections agency). Dey argued that the agreement between Vacation Resorts and Continental impermissively rewrote the association’s rules on delinquent assessment collection by charging delinquent owners a “collection fee” in addition to interest and late charges in violation of the State’s Unfair Competition Law. Dey argued that the association, not the collections agency or property manager, should be entitled to recover costs incurred by the collection of delinquent assessments. Citing Brown v. Professional Community Management [127 Cal.App.4th 532 (2005)] and Berryman v. Merit Property Management [152 Cal.App.4th 1544 (2007)], the appellate court found that Dey failed to show how, and why, the “collection fee” was not permitted by law or was prohibited pursuant to a contract. Gorman v. Tassajara Development Corp. [178 Cal.App.4th 44 (2009)] Attorneys’ Fees. Gorman, a lawyer, and his wife sued the Tassajara Development Company alleging defective construction of their custom-built home. Gorman also sued on behalf of other plaintiffs for similar construction defects. The lawsuit was ultimately settled and, as part of the settlement agreement, Gorman and the other plaintiffs were deemed the “prevailing parties” entitled to recover attorneys’ fees and court costs pursuant to the construction contract between Tassajara and each of the plaintiffs. The trial court issued a 27-word order awarding substantially less in attorneys’ fees and court costs than requested by the plaintiffs. The plaintiffs demanded a statement of the court’s decision or a new trial, and both motions were denied; as a result, the plaintiffs appealed. The appellate court ultimately held that the trial court’s award could not be rationally explained and was therefore arbitrary. The matter was remanded to the trial court for further proceedings. Martin v. Bridgeport Community Association, Inc. [173 Cal.App.4th 1024 (2009)] Non-Owner Resident Status to Sue. The Petersons purchased a home in the Bridgeport development and then agreed that the Martins (the Petersons’ daughter and son-in-law) would live in the home, pay the mortgage and maintain the property. The Petersons executed a power-of-attorney, which the association accepted, that authorized the Martins to deal directly with the association on issues regarding the property.

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The Martins then discovered that the lot where the home was located was smaller than what was represented to the Petersons. The developer, Richmond Homes, agreed to transfer the additional area by two lot-line adjustments. However, before the second lotline adjustment was completed, Richmond Homes transferred the land to the association by deed. Subsequently, the association refused to cooperate regarding the second lot-line adjustment. The court determined that the Martins, as non-owners, lacked standing to sue the association and seek enforcement of the CC&Rs. Absent an actual transfer of rights, no agreement, assignment, or power-of-attorney can operate to transfer said rights (e.g. the right to enforce governing documents, right to enforce the DavisStirling Act, etc.) that are inextricably tied to actual ownership of real property.

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Nelson v. Avondale Homeowners Association [172 Cal.App.4th 857 (2009)] Home Businesses. Nelson, an owner within Avondale HOA, operated a homeopathic and religious counseling practice from his home. He asserted that he could not work outside his home due to health issues, including Epstein-Barr syndrome and hypothyroidism, which prevented him from driving. He typically saw eight patients per day, five days a week. The CC&Rs prohibited the operation of a home-based business that would increase pedestrian and/or vehicular traffic beyond what was common in residential areas. Moreover, the CC&Rs required approval by both the city and the board of directors, which Nelson did not obtain, before a home business could be operated. The association tried enforcement measures, such as restricting Nelson’s guest access privileges and imposing fines. Nelson sued the association, claiming discrimination based on his disability (his health issues) and his religion. The appellate court held that the association’s covenant against operating a home business was enforceable and that the association’s manner of enforcing the covenant did not discriminate against Nelson. Palacio Del Mar Homeowners Association v. McMahon [174 Cal.App.4th 1386 (2009)] Collections. Palacio Del Mar Homeowners Association obtained a $40,000 judgment against McMahon for his frivolous antiSLAPP lawsuit. In trying to satisfy the judgment, the association demanded that an Internet domain name (American Homeowners Resource Center website), in which the owner’s wife had an interest, be

March 2010 | ECHO Journal

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turned over to the association and subsequently sold at auction by the association to satisfy the debt. The appellate court held that judgment creditors are not entitled to possession and control of property. Rather, they are only entitled to money and/or proceeds from the sale of property. In addition, the court held that the property was not properly available to satisfy the judgment because the domain name was owned by the owner’s wife, who was not a party to the action. Standard Pacific Corp. v. Superior Court of San Bernardino County (Garlow) [176 Cal.App.4th 828 (2009)] Construction Defects. Various homeowners had filed a lawsuit against Standard Pacific, the developer, for construction defects. The developer sought to stay the legal proceedings until the statutory pre-litigation procedures outlined in Civil Code §910 et seq. (sometimes also called the “Fix It” law, SB 800, or Title 7) were completed. These pre-litigation procedures provide an opportunity for the builder and homeowner (or association) to try and resolve the defect issues without resorting to the courts. The homeowners claimed that Standard Pacific was in violation of the “Fix It” law because the developer had failed to “opt in” and affirmatively choose to be covered by the statutory pre-litigation procedures, and the trial court sided with the homeowners’ interpretation of the statute. The appellate court disagreed, stating that the builder is required to comply with pre-litigation procedures and does not need to “opt in.” Moreover, the appellate court ruled that the homeowners had the burden of showing that the developer failed to comply with the procedures before initiating a lawsuit. Starlight Ridge South Homeowners Association v. Hunter-Bloor [177 Cal.App.4th 440 (2009)] Maintenance. In this case, Ms. HunterBloor, the owner of a residential lot in Starlight Ridge, unsuccessfully argued that she was not responsible for the maintenance of a drainage “V” ditch that crossed her lot. Hunter-Bloor contended that the drainage ditch on her lot was completely contained with a landscape maintenance area that was the sole responsibility of the association. The association argued that, while landscape maintenance areas were indeed its responsibility, a more specific provision of the CC&Rs directing individual owners to maintain “drainage systems and devices” made HunterBloor responsible. The appellate court

March 2010 | ECHO Journal

agreed with the association. In addition to examining the language of the CC&Rs, the court looked at (1) the association’s historical practices related to the drainage ditches (for nearly 20 years the association had enforced the CC&Rs to require individual homeowners to repair and maintain drainage ditches located on their property) and (2) the overall purpose of the landscape maintenance areas (in the court’s view, landscape maintenance areas were aesthetic in nature, making the association’s maintenance of drainage facilities incompatible). Statutes The volume of legislation affecting homeowners associations was relatively light in 2009. The following is a summary of several significant Assembly bills that became law on January 1, 2010, and do impact the operations of California homeowners associations. AB 313—Civil Code Section 1366.4 Assessment Formulas. This new statute generally prohibits associations from levying assessments on residences within the common interest development based on the taxable value of the homes, unless the association, in accordance with its governing documents, levied assessments against homes based on their taxable value on or before December 31, 2009. Associations that pay property taxes for the homes in the subdivision may levy that portion of the assessments that is related to the payment of taxes based on the taxable value of the homes, as determined by the tax assessor. Most associations did not and will not levy assessments based on the appraised value of the homes and do not pay property taxes related to the residences. Accordingly, this bill will have the narrow effect of protecting the right of the few associations to levy assessments based on property tax valuation where that was done before the end of the year. AB 712—Code of Civil Procedure Section 116.220

ric ReP duce ed

Small Claims Court. This statute authorizes the small claims court to award injunctive or other relief when another statute expressly authorizes a small claims court to award that relief. Presently, the Davis-Stirling Act does not expressly authorize the small claims court to issue injunctive or other equitable relief, although it does permit certain monetary claims to be filed in small claims court. ECHO Journal | March 2010

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AB 899â&#x20AC;&#x201D;Civil Code Section 1350.7 and 1365.2.5 Disclosure. This legislation, sponsored by ECHO, addresses disclosure issues. There are three distinct facets to the legislation. First, the bill adds a new Section 1363.005 to the Civil Code that consists of a Disclosure Documents Index. This index correlates all of the Davis-Stirling disclosure requirements of homeowners associations to their members. A list of the documents in the index is shown on page 37. Secondly, the statute permits the association to deliver any document scheduled in the Disclosure Document Index to a member by alternative means, including personal delivery, first class mail, the associationâ&#x20AC;&#x2122;s newsletter, a method provided in a recorded provision of the governing documents, or by another means to which the recipient has agreed. Importantly, the methods of distribution of the documents scheduled in the Disclosure Documents Index now includes email, facsimile or other electronic means, provided that the recipient has agreed to that method of delivery. The agreement for receipt of the documents by electronic means must be consistent with the manner of obtaining consumer consent described in Corporations Code Section 20. That section, in turn, requires that, as a condition of electronic service of communications, the recipient provides to the corporation an unrevoked consent to the use of those means of transmission for communications and the communication must create a record that is capable of retention, retrieval and review that may thereafter be rendered into clearly legible tangible form. The Corporations Code further requires, as a condition of electronic service of documents, that the consent for service be obtained after delivery of a clear written statement as to (1) the right of the recipient to have the record provided or made available on paper or non-electronic form; (2) clarification concerning whether the consent applies only to that transmission, to specified categories of communications, or to all communications from the corporation; and (3) the procedures the recipient must use to withdraw consent. It is apparent that while this new law facilitates distribution of disclosures by the association through electronic means, and presumably largely through email, valid distribution requires the recipient to execute a knowledgeable consent form. It

is recommended that this document be prepared by legal counsel. This bill also modifies the annual assessment disclosure form that is embedded in Civil Code Section 1365.2.5. Specifically, the note following sub-paragraph (a)(7) in the form is revised to require disclosure of the assumed long-term before-tax interest rate earned on reserve funds and the assumed long-term inflation rate to be applied to major component repair and replacement costs per year. The disclosure of these key elements of the reserve study will assist the board and members in practical financial planning for the future financial needs of the association. AB 1020—Health & Safety Code Section 18942, 116064.1 and 116064.2 Pool Safety. This law requires that existing public swimming pools, which includes swimming pools for multi-family residential areas, be equipped with anti-entrapment devices or systems that meet ASME/ANSI or ASTM performance standards. It further requires that existing public swimming pools with a single main drain that is not an unblockable drain to meet at least one of the specified standards. It further requires the Department of Public Health to develop, and public swimming pool owners to file, a form to indicate compliance with the requirements of the bill including certification by a qualified individual that prescribed factual information provided on the form is true to the best of his or her knowledge. A fee is authorized to defray the expenses of the State Department of Public Health in connection with the law. It is a misdemeanor to violate the requirements. The retrofit requirements must be completed no later than July 1, 2010, unless the pool completed a retrofit between December 19, 2007 and January 1, 2010 in compliance with the federal Virginia Graeme Baker Pool and Spa Safety Act in effect on the date of issuance of the construction permit. However, in this case, the public swimming pool owner must file a form with the Department of Health confirming that such retrofit work was completed. Homeowner associations must complete retrofits as required by this law or certify completion of the retrofits under the Virginia Graeme Baker Act during the allowable period. The forms to be filed with the State Department of Health must be completed carefully by a knowledgeable individual to avoid liability.

AB 1061—Civil Code Section 1353.8 Architectural Guidelines. This new law expands on the existing prohibition against architectural guidelines that condition or effectively prohibit the use of low water using plants as a group. The new law now further prohibits architectural guidelines from prohibiting or restricting water-efficient landscape ordinances adopted in accordance with Government Code Section 6559(c) or regulations or restrictions on the use of water adopted to Water Code Sections 353 or 375. However, the statute allows associations to apply landscaping rules and regulations in the governing documents to the extent the rules and regulations fully conform to the requirements of the new law. AB 1233—Nonprofit Corporation Law Corporations Code Changes. This bill makes changes to several provisions of the Corporations Code pertaining to the governance of nonprofit mutual benefit corporations (most homeowner associations). Among the clarifications in the bill are that: (1) directors may not vote by proxy in director meetings; (2) committees of the board may not include non-directors, but in other committees non-director members may serve as long as such committees do not exercise authority of the board; (3) the corporation must have a chairman of the board or a president or both, and a treasurer or a chief financial officer or both. The bill further clarifies that if a director is relying upon a report of a committee of the board, the committee must be composed exclusively of any combination of (a) directors; (b) directors or employees of the corporation whom the director believes to be reliable and competent in the

matters presented; or (c) counsel, independent accountants, or other persons as to matters that the director believes to be within the person’s professional or expert competence. The director must also believe that the committee merits the director’s confidence. SB 407—Civil Code Sections 1101.1–1101.9 Water Use Efficiency Improvements. This law requires that multi-family residential real property, including mixed residential-commercial buildings, that were constructed on or before January 1, 1994 replace noncompliant plumbing fixtures with water-conserving plumbing fixtures no later than January 1, 2019. The statute defines noncompliant plumbing fixtures as toilets manufactured to use more than 1.6 gallons of water per flush, and showerheads manufactured to have a flow capacity of more than 2.5 gallons of water per minute. The implication of this statute for common area improvements, such as clubhouses and pool buildings, is minimal. Certain limitations and exceptions apply. Seemingly the conversion requirement applies to associations only with respect to plumbing fixtures that are under their control in the common area and not to those within the separate interest units or lots.

Lise K. Ström is an attorney in private practice in the South Bay who provides legal services to residential, mixed-use, and commercial community associations with a focus on green development and green conversions. Jeffrey A. Barnett is an association attorney with legal offices in San Jose. He is a past member of ECHO’s Board of Directors and a current member the Legal Resource Panel, the Legislative Committee and several regional resource panels. ECHO Journal | March 2010

March 2010 | ECHO Journal

By Richard Tippet

or more than thirty years, our firm’s task has been to keep buildings free of leaks. When we first became seriously involved with leaks through stucco walls, we worked with John Bucholtz, a nationally recognized expert on the subject. His good counsel saved us from some of the errors in judgment based on a lack of knowledge that are still being made by others.

In the years since, we’ve learned a lot more. Common sense, work with stucco repair contractors and a willingness to experiment (in other words, lots of homeowner associations with limited budgets) have been useful teachers. While we don’t even begin to pretend to know all there is to know,

we do want to dispel a few misconceptions, show you how to keep and enjoy the stucco you already have and let you keep your reserves in the bank. Misconception No. 1: Stucco isn’t waterproof. Stucco is made of Portland cement. Portland cement is water-resistant. Anyone doubting this is invited to perform the following demonstration. 1. Obtain a 3/4" thick flat piece of stucco. 2. Remove the color coat. 3. Bond a 2" or 3" diameter glass tube to the stucco with caulking. Allow to cure.

ECHO Journal | March 2010

4. Set the stucco and tube on a table and put 2" of water in the tube. Cover the open end of the tube to protect the water from evaporation. Work on other projects until all of the water in the tube passes through the stucco. This should take until at least the year 2012. Misconception No. 2: It’s the paper behind the stucco that makes the wall waterproof. If the paper is the waterproofing agent, why not do away with the expense of installing the stucco and simply trowel the color coat right onto the paper? (The industry actually tried a version of this idea. It was called the EIF system and it was a spectacular failure.)

Paper is there only to hold the stucco against the wire so that the wet cement doesn’t fall away. The paper or “weather-resistant barrier” used to back wire lath is what is known as a “grade D” paper, designed to be capable of resisting water penetration for at least ten minutes, and with a minimum water vapor permeability rating of 35. Claims of waterproofness for a product designed to keep water out for so short a time are simply silly. The truth is that the paper is there only to hold the stucco against the wire so that the wet cement doesn’t fall away. This allows stucco to be placed directly over openframed stud walls, which reduces construction costs. For those still clinging desperately to the belief that “It’s the paper,” we have one question: Why does the building code require two layers of building paper between fresh stucco and wood? (Hint: what happens if the water of hydration in the stucco migrates into the wood?) Misconception No. 3: Everyone knows that stucco always cracks. No, everyone doesn’t. Our office was once located in an early 1960s stucco-walled building in a California Detailed on-site inspections, inventories and asset descriptions • Spreadsheet report format now available on request 30-year threshold and components models • 16 years of reserve study experience • Call today for a free proposal

Continued on page 22 20

March 2010 | ECHO Journal

New election rules: $500 In today’s economic crisis, there may be some items that associations can cut to reduce costs. ECHO membership is not one. Let’s face it, educated board members are better fiduciaries, which helps them to avoid costly law suits and possibly personal liability. ECHO is the premier resource in California for board member education. ECHO offers new articles each month with practical and easy to understand advice about current California requirements, and what may be on the horizon. ECHO staff is available by phone or E-mail to answer members’ questions about association problems or to recommend competent professional services when necessary. And with discounted member rates at more than a dozen educational events throughout the year, ECHO is simply the best educational resource for California homeowners. Avoid Litigation Each year, as a member benefit, ECHO sends every board member a copy of the updated Community Association Statute book. Every issue of the ECHO Journal and every seminar examine one or more aspects of compliance with association law, because one of the major causes of expensive litigation is ignorance of the law.

Mailing ballots: $200 Make Better Financial Choices Many associations struggle to understand reserve funding requirements and strategies, the benefits and disadvantages of using special assessments, proper collections practices, and even how to determine what components the association is required to maintain. At a time when wise financial planning is essential, ECHO members have access to a wealth of articles about reserve funding, budgeting, insurance, collections, and much more. Fight Costly Regulation Every year, Sacramento legislators introduce more legislation that confuses the job of California board members and increases the costs of compliance. ECHO is committed to fighting unnecessary regulation in California and promoting the interests and welfare of common interest developments. Hire Competent Professionals ECHO offers a variety of articles and publications to help members evaluate their service providers, including questions to ask prospective management firms and contractors. All ECHO Journal articles are available to members at no cost, and publications are sold to members at a discount.

Avoiding a lawsuit: Priceless. Spend a Little, Get a Lot The cost of ECHO membership is minimal. In a worsening economy, associations are looking to cut big expenses from their budgets. Yet, ECHO membership is as little as 25¢ per unit each month. For that small cost, here’s what every board member receives as part of being a member of ECHO: • A subscription to the ECHO Journal • An annual copy of the current Community Association Statute book • Unlimited access to ECHO’s library of past articles • Telephone consultations with ECHO staff about their problems • Reduced fees for ECHO events • Discounted prices on publications • And much more… In These Tough Economic Times, ECHO Membership is a Necessity As the only California organization devoted exclusively to board member and homeowner education, ECHO is a one-of-a-kind resource that your association can’t afford to lose.

Joys of Stucco Continued from page 20

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coastal town where the weather was unusually temperate, frequently fog-damp and where temperatures seldom go below 40F or above 80F. The stucco had been installed and cured under near-ideal conditions. The walls of that building were crack-free and could barely be drilled with masonry bits. Stucco is a product with simple characteristics (such as slump and compressive strength) easily measured and compared to industry standards in the field. These standards are meant to ensure that stucco performs properly over decades. There are two excellent sources of these standards. One is the Uniform Building Code. The second is the Manual of Plaster, Metal Framing Systems and Lath published for the California Lathing and Plastering Contractors Association. Properly mixed, placed and cured, stucco will not cause itself to crack. Other forces are required. They include, in no particular order: • Improperly attached wire lath. • Improperly installed edge details, particularly at windows. • Improperly spaced or placed control joints • Improperly constructed building foundations that allow differential settlement or seasonal shifting. • Improperly installed or flashed wall penetrations or decorations that allow water to contact wood framing. • Structural framing that flexes with the wind loads imposed on it. • Earthquakes and other, similar forcemajeure occurrences. Misconception No. 4: The Only Way to Stop Stucco From Leaking Is to Coat It With an ‘Elastomeric’! Elastomeric coatings will not work in many situations. One example is a building constructed on poorly designed foundations that allow the walls to move with seasonal soil moisture changes. This causes cracks in stucco to open and close across distances greater than most coatings can “bridge”. Another example is leakage due to wood embedded in stucco. Wood typically expands and contracts with seasonal moisture content changes in amounts that also exceed the crack bridging capacity of most coatings. And wood should never be coated with an “elastomeric”. Yet another is when surfaces are

March 2010 | ECHO Journal

poorly cleaned or primed and the coating doesn’t bond properly. This can result in water blisters caused by water getting trapped between coating and stucco. These blisters frequently position themselves above cracks in the stucco and can actually make the leakage worse. There is another, more serious problem. Applying one of these coatings to a stucco wall effectively creates a vapor barrier on the wrong side of the wall. The problems with condensation in the wall, high interior humidity, mold, mildew and rot caused by cold-side vapor barriers are well known. They have been written about extensively. Any plan to eliminate exterior wall “breathability” must include a consideration of interior humidity control and air circulation, particularly including closet areas located against exterior walls. The installation of mini-vents in the stud cavities in walls should also be considered.

Stucco is a form of concrete that is easily repaired by skilled painting contractors. lems, will save you a wonderful amount of money and will keep you “going green.” Stucco Maintenance: How to Keep Your Existing Stucco The best solution to any stucco problem is not to tear it all off or “coat it and hope.” The solution is simply to repair the cracks with a material that will move and flex as the building itself does. 1. Scrape out, deepen and groove any cracks in the stucco to at least 1/4" x 1/8" in the brown coat. 2. Scrape a 1/4" groove between all embedded wood trim and the stucco around it. 3. Use a grout removing tool to scrape a shallow groove between stucco and window frames. 4. Blow all grooves free of dust, dirt and debris. 5. Fill the grooves with a good quality urethane caulk or specially manufactured stucco repair material. 6. Texture the repair material to match the existing stucco texture. 7. Prime and paint the walls with the best quality exterior grade primer and paint. Following these simple steps will go a long way to solve almost any wall leakage prob-

Author’s note: The original version of this article was published ten years ago. We are rewriting it because we continue to see buildings that have had the stucco siding completely removed and replaced simply because it was cracked or windows leaked.

Richard Tippett is the principal of ERTECH, Inc. the first roofing and waterproofing consulting firm established in California. He has been extensively involved in stucco and EIF restoration projects in all of California’s varied climates. He serves on the ECHO Board of Directors and is the vice-chair of ECHO’s Maintenance Resource Panel.

Stucco is a form of concrete that is easily repaired by skilled painting contractors. It doesn’t need to be replaced. Window leaks can be stopped by simply replacing the window with a retrofit vinyl insert. Reduce, Reuse, Recycle There is nothing “green” about removing and replacing stucco. The material cannot be recycled because it is full of metal, paper and paint. Removing it releases a mildly caustic dust. Putting it into landfill reduces future landfill capacity. Reserving For Stucco Replacement We have surveyed buildings with concrete stucco walls that are nearly 100 years old. There is no need to begin to reserve for stucco replacement unless your complex is at least 50 years old. Stucco doesn’t “wear out” very quickly. ECHO Journal | March 2010

rchitectural review is serious business for an association board. One of the important attributes of any type of common interest development is its high standard for uniform construction, design and aesthetics. People choose to live in planned communities for this very reason. As an association board, you play a vital role in enforcing and maintaining these standards, often with the help of an architectural committee.

March 2010 | ECHO Journal

How should you, as a board or committee, approach the process? Your governing documents, along with pertinent California statutory and case law, will provide the framework for you to follow. One owner wants to remove structural walls in his remodeling. Another wants an elaborate arbor built over her backyard. Yet another seeks to add a koi pond. What to do?

By Sharon Glenn Pratt, Esq.

Oh No, Not in My Neighborâ&#x20AC;&#x2122;s Backyard! You may be tempted to reject all proposed additions or remodels, just to keep things simple and uniform, and to satisfy neighbors who oppose the improvements. Yet blanket rejections are as irresponsible as a laissezfaire acceptance of every proposed change. Every proposal should be considered on its own merits. You have a duty to protect property values. Remodeling and making improvements can preserve and increase those

property values, when they are done correctly. To protect against shoddy work and unsightly changes, request an appropriate expertâ&#x20AC;&#x2122;s stamp of approval from a structural engineer, architect, or koi pond expert, whatever the case may be. A mock-up of the arbor, structural calContinued on page 27

ECHO Journal | March 2010

ECHO 2010 Seminars Yes, they’re already here. The 2009 seminars are behind us, but 2010’s events are already underway. Do not forget to mark these dates in your calendar for ECHO 2010 seminars: • March 20—Wine Country Seminar, Rohnert Park • April 17—South Bay Seminar, Campbell • May 1—Sacramento Seminar, Rancho Cordova • June 19—Annual Seminar, Santa Clara

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Not In My Neighbor’s Backyard Continued from page 25

culations on the wall removal, a photo of a similar koi pond—all can do wonders in assuring a quality improvement. Modifications of the requested improvement can be suggested and approval can be made contingent on such changes. Let the owners know your concerns, and those of their neighbors, and engage in a give and take process when discussing whether to grant architectural approval. Be careful not to conduct your architectural review behind closed doors, or on an ad hoc, over-the-phone or email basis. Under Corp. Code section 7211, when a committee constitutes a “committee of the board”, the notice and quorum requirements for board meetings also apply to the committee. This means that your discussion of the application, as well as your vote, should all take place at an open noticed meeting. Whatever you do, don’t ignore or “back burner” an application that you have received. A lack of response from the architectural committee

may be deemed to be an approval after a certain amount of time, depending on your governing documents. Having a step-by-step procedure in place for all architectural review applications is advisable. California law requires that the decision of the committee and/or board must be made in good faith and may not be unreasonable, arbitrary, or capricious. It may not violate any applicable codes, such as building codes, land use, or public safety provisions (Civil Code section 1378). A written decision should be issued. What if the owner is unhappy with the decision? Your governing documents are required by law to include an appeal procedure that is “fair, reasonable, and expeditious” and “provides for prompt deadlines.” Owners are typically quite invested, both financially and personally, in the architectural changes that they propose. As a board, recognize this fact. The appeal process and hearing can be emotionally charged. The more controversial the issue, the more important it is for the board to follow proper formal procedure. Owners will appreciate the fact that you are taking their proposals seri-

ously and giving them due consideration. If your governing documents do not contain the roadmap for the architectural committee and board to follow, including prompt deadlines and a maximum time for response, then it is time to add such a written procedure. Not only is it mandatory that it be included in your documents; it is also mandatory that a copy of the procedure be provided to the owners on an annual basis [Civil Code sections 1378(a)(1) and 1378(c)]. You are not likely to please everyone every time with your architectural review decisions, but all parties involved will appreciate an orderly, professional, and legal process, and the fact that the decision has been made within such a context.

Sharon Pratt is the managing partner of Pratt & Associates in Campbell, California. She is a specialist in common interest development law and litigation and has been practicing in the San Jose area for 25 years. ECHO Journal | March 2010

News from ECHO

Smoke Alarms Save Lives A working smoke alarm is the best way of alerting residents to a fire. Smoke alarms save lives, families and firefighters. While the message is simple, statistics show that Americans need to pay more attention to not only installing, but also maintaining, the smoke alarms in their homes. A smoke alarm with a dead or missing battery is the same as no smoke alarm at all. When both smoke alarms and fire sprinklers are present in a home, the risk of dying in a fire is reduced by 82 percent, when compared to a residence without either. Every year, more than 3,000 people die in home fires in the United States; most of these are in homes without a working smoke alarm. To prevent these deaths, the U.S. Fire Administration, a division of the Federal Emergency Management Agency, is sponsoring a nationwide Install. Inspect. Protect. Campaign designed to raise awareness about how working, properly installed smoke alarms can lower a person’s chances of dying in a fire. The Install. Inspect. Protect. Campaign is aimed at encouraging Americans to practice fire safety by 1) installing and maintaining smoke alarms and residential fire sprinklers, 2) practicing fire escape plans, and 3) performing a home safety walk28

March 2010 | ECHO Journal

through to remove fire hazards. The campaign is promoting fire safety through a free Campaign Toolkit disc, educational materials, print, radio and television public service announcements, children’s materials, community organization-sponsored events and a consumer-friendly campaign web site. For more information on the Install. Inspect. Protect. Campaign and other fire prevention information, visit www.usfa.dhs.gov/smokealarms. New Statutes Effective 1-1-10 The volume of legislation affecting homeowners associations was relatively light in 2009. The following is a summary of three Assembly bills that became law on January 1, 2010, and do impact the operations of California homeowners associations. AB 712—Code of Civil Procedure Section 116.220— Small Claims Court This statute authorizes the small claims court to award injunctive or other relief when another statute expressly authorizes a small claims court to award that relief. Presently, the DavisStirling Act does not expressly authorize the small claims court to issue injunctive or other equitable relief, although it does permit certain monetary claims to be filed in small claims court. AB 899—Civil Code Section 1350.7 and 1365.2.5 This legislation addresses disclosure issues. There are three distinct facets to the legislation: 1. The bill adds a new Section 1363.005 to the Civil Code that consists of a Disclosure Documents Index. This index correlates all of the Davis-Stirling disclosure requirements of

homeowners associations to their members. 2. The statute permits the association to deliver any document scheduled in the Disclosure Document Index to a member by alternative means, including personal delivery, first class mail, the association’s newsletter, a method provided in a recorded provision of the governing documents, or by another means to which the recipient has agreed. Importantly, the methods of distribution of the documents scheduled in the Disclosure Documents Index now includes e-mail, facsimile or other electronic means, provided that the recipient has agreed to that method of delivery. There are specified requirements for the consent form. 3. This bill modifies the annual assessment disclosure form in Civil Code §1365.2.5. Specifically, the note following sub-paragraph (a)(7) in the form is revised to require disclosure of the assumed long-term before-tax interest rate earned on reserve funds and the assumed longterm inflation rate to be applied to major component repair and replacement costs per year. AB 1020—Health & Safety Code §§18942, 116064.1, 116064.2— Pool Safety This law requires that public swimming pools, which include pools for multi-family residential areas, be equipped with antientrapment devices or systems that meet ASME/ANSI or ASTM performance standards. It requires that existing public swimming pools with a single main drain that is not an unblockable drain to meet at

least one of the specified standards. It requires the Department of Public Health to develop, and public swimming pool owners to file, a form to indicate compliance with the requirements of the bill including certification by a qualified individual that prescribed factual information provided on the form is true to the best of his or her knowledge. It is a misdemeanor to violate the requirements. The retrofit requirements must be completed no later than July 1, 2010, unless the pool completed a retrofit between December 19, 2007 and January 1, 2010 in compliance with the federal Virginia Graeme Baker Pool and Spa Safety Act in effect on the date of issuance of the construction permit. However, in this case, the pool owner must file a form with the Dept. of Health confirming that such retrofit work was completed; the forms must be completed carefully by a knowledgeable individual to avoid liability to the association. Important Upcoming Events Thursday, March 18 San Francisco Luncheon 11:45 a.m. St. Francis Yacht Club, San Francisco Saturday, March 20 North Counties Seminar 8:00 a.m. to 1:00 p.m. Rohnert Park Community Center 5401 Snyder Lane, Campbell Saturday, April 17 South Bay Spring Seminar 8:00 a.m. to 1:00 p.m. Campbell Community Center Roosevelt Room 1 W. Campbell Ave., Campbell

By Ed Edrosa

VOCs Clearing the Air olatile organic compounds, VOCs as they are commonly called, are an increasing concern in the paints and coatings industry. The continuing regulatory push toward even lower VOC content has prompted significant change in paint formulations, with paints and coatings manufacturers using low-solvent or solvent-free raw materials to create products that comply with the new regulations aimed at protecting the environment. In addition to higher regulatory pressure, there has been a surge in the green building movement, resulting in greater acceptance and awareness of low-VOC paints among consumers, many of whom are turning to these “eco-friendly” or “green” paints for the environmental benefits, as well as for health concerns.

Currently, there is no mandatory industry standard for what constitutes low- and zero-VOC paint. Even the voluntary standards that do exist, such as Leadership in Energy and Environmental Design (LEED), do not provide a clear definition and distinc-

tion between these terms. “Zero-VOC” and “no-VOC” are really misnomers and only mean extremely low VOC content levels. In fact, even regulators recognize that zero-VOC paints have a trace or residual amount of VOCs. What makes it more contentious is that EPA Test Method 24, the widely accepted method for determining VOCs, is inaccurate at VOC content levels below 100 g/L. At one paint manufacturer, a paint is termed “zero-VOC” if it contains none of the solvents that are added to conventional latex paints. Since their evolution in the early 1990s, zero-VOC paints have been surrounded by a lot of hype. What began as a niche product that fit an emerging market trend has become the industry standard, with most paint manufacturers coming out with their own versions of zero- and low-VOC paint. In light of these explanations, a few questions still remain: • Does a paint need to be zero-VOC to be considered green? • Are all zero-VOC paints green?

• What really constitutes “green” paint? With paint as the most visible aspect of a building, it is hard to imagine a green building that doesn’t use green coatings. Covering a large amount of exterior and interior surfaces of buildings, they make a substantial contribution to air quality. For paint and coating systems to be integral to the idea of green building, the focus should not solely rest on VOCs. Given that the primary function of paints and coatings is to protect and preserve the surfaces to which they are applied and, thus, extend the life of such surfaces, it is imperative for any green paint specification to address VOCs in the context of performance. The amount of VOC in paint, however, is only a small part of the product’s overall eco-efficiency. Inadequate consideration of product performance when formulating low- to zeroVOC paints is counter to the goal of creating a more sustainable environment. When we Continued on page 32 ECHO Journal | March 2010

Directory UPDATES Updates for listings in the 2008 ECHO Directory of Businesses and Professionals.

New Member Listings Infinity Property Management, LLC 1245 S. Winchester Blvd., Ste. 313 San Jose, CA 95128 Contact: Frank Baldan Tel: 408-248-4765 Fax: 408-248-4770 www.infinitypropertymanagement.com Email: frank@infinity propertymanagement.com Infinity Property Management provides superior full service property management to community associations throughout the Bay Area. Merit Property Management 111 Deerwood Road Santa Rosa, CA 94583 Contact: Joe Price Tel: 925-855-3240 Fax: 925-855-3241 www.meritpm.com Email: jprice@meritpm.com Merrill, Nomura & Molineux, LLP 350 Rose Street Danville, CA 94526 Contact: Jeffrey Cereghino, Esq. Tel: 925-833-1000 Fax: 925-8333-1001 Email: jcereghino@merrillnomura.com MNM is a litigation firm specializing in the representation of homeowners associations in complex construction defect and enforcement litigation, and mediation. MNM attorneys all have substantial trial experience.

March 2010 | ECHO Journal

Neumiller & Beardslee P.O. Box 20 Stockton, CA 95201 Contact: Nathan McGuire, Esq. Tel: 209-948-8200 Fax: 209-948-4910 www.neumiller.com Email: nmcquire@neumiller.com Neumiller and Beardslee has represented hundreds of residential and commercial ownersâ&#x20AC;&#x2122; associations since the 1960s. The work the firm provides to ownersâ&#x20AC;&#x2122; associations includes the revision of governing documents. The firm also provides general litigation services for ownersâ&#x20AC;&#x2122; associations. STI Trucking 36467 Haley Street Newark, CA 94560 Contact: Patricia McDonald Tel: 510-790-8080 Fax: 510-796-2811 www.stitruck.com Email: nawicpat@sbcglobal.net Construction trucking in various types of dump equipment.

Changes to Member Listings CalVac Paving 2645 Pacer Ln. San Jose CA 95111 Contact: Jim Adam Tel: 408-225-7700 650-694-7944 Fax: 408-225-7733 Fong & Fong 2161 Harbor Bay Parkway Alameda, CA 94502-3019 (Address change only)

6(59,1* &20081,7,(6 7+528*+287 1257+(51 &$/,)251,$ 672&.721 +4 Â&#x2021; )5(0217 PLEASANTON Â&#x2021; &233(5232/,6 Â&#x2021; 02'(672 Â&#x2021; 6$17$ &/$5$

M & C Association Management Services provides community association management and developer services to Fremont, Pleasanton, Santa Clara, Stockton, Modesto, Copperopolis and the surrounding foothills. Since 1990, our sole focus has been to deliver performance that enriches communities and enhances the lives of the people we serve. M & C is proud to be an Accredited Association Management CompanyÂŽ (AAMCÂŽ), which is the Community Associations Instituteâ&#x20AC;&#x2122;s highest GHVLJQDWLRQ DZDUGHG WR PDQDJHPHQW Ă&#x20AC;UPV

3OHDVDQWRQ Â&#x2021; )UHPRQW Â&#x2021; 6DQWD &ODUD Stockton 209.644.4900 Â&#x2021; 0RGHVWR Â&#x2021; &RSSHURSROLV For management proposal information, please visit www.mccommunities.com or email info@mccommunities.com ECHO Journal | March 2010

VOCs Continued from page 29

look at the bigger picture—understanding eco-efficiency as the ability to satisfy human needs in ways that minimize adverse impacts on energy and material resources, environmental quality, and human health and safety—we can see that paint is inherently ecoefficient. In general, zero-VOC paints on the market today do not perform as well as paints with higher VOC content. The main appeal of zero-VOC paint is the lack of odor when it is used indoors. This characteristic can be important when painting must take place in occupied buildings or around sensitive people. It may be less important, however, in situations where performance is of greater concern. While technology for zero-VOC paints has improved and performance is beginning to approach that of standard paints, there are still trade-offs involved because one property may be enhanced at the expense of another. To achieve the low-odor advantage of zero-VOC paints, some limitations in performance must be accepted. The VOC solvents used in latex paints are functional ingredients that work with resins (the “glue” that holds the paint together and sticks it onto the wall) to achieve better performance in various ways, including better flow and leveling, touch-up, hardness, abrasion resistance and stain resistance. When durability is more important than low odor, there are ultra-lowVOC paints that have VOC contents at or below 50 g/L. These are recommended for situations where long-term durability is more important than low-odor during application, drying and curing. As sustainability has become a greater driving force in the design and construction of residential and non-residential buildings, manufacturers of quality paints remain committed to its efforts to ensure that their products are formulated for optimum performance, especially in terms of coverage and durability. They recognize that performance is the key to eco-efficiency of paint products, because optimum durability maximizes environmental benefits, while minimizing total burdens.

Ed Edrosa is the Specialty Coatings Product Manager at Dunn-Edwards Corporation, an ECHO member company. 32

March 2010 | ECHO Journal

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ECHO Journal | March 2010

2008 ECHO Business & Professional Directory $20.00 Non-Member Price: $25.00

Condominium Bluebook 2010 Edition $18.00 Non-Member Price: $25.00

Homeowners Association and You $13.00 Non-Member Price: $20.00

Community Association Statute Book—2010 Ed. $15.00 Non-Member Price: $25.00

This directory lists all business and professional members of ECHO as of December 2007. Current addresses, telephone and fax numbers, email addresses, and a short description are included. This directory is an invaluable tool for locating service providers that work with homeowner associations.

This well-known compact guide for operation of common interest developments in California now includes a comprehensive index of the book and a chapter containing more than 200 frequently-asked questions about associations, along with succinct answers.

A practical problem solving guide to all aspects of community association living. Written by two long-time association residents, it provides an insightful overview of community living from the viewpoint of experienced owners in readable language. Recently revised and expanded.

Contains the 2010 version of the Davis-Stirling Common Interest Development Act, the Civil Code sections that apply to common interest developments and selected provisions from the Civil, Corporations, Government and Vehicle Codes important to associations.

Robert’s Rules of Order $7.50 Non-Member Price: $12.50

The Board’s Dilemma $10.00 Non-Member Price: $15.00

A step-by-step guide to the rules for meetings of your association, the current and official manual adopted by most organizations to govern their meetings. This guide will provide many meeting procedures not covered by the association bylaws or other governing documents.

In this essay, attorney Tyler Berding confronts the growing financial problems for community associations. Mr. Berding addresses board members who are struggling to balance their duty to protect both individual owners and the corporation, and gives answers to associations trying to avoid a funding crisis.

California Building Guidelines for Residential Construction $52.50 Non-Member Price: $60.00

e Pricuced Red Homeowners Associations— How-to Guide for Leadership $25.00 Non-Member Price: $25.00 This well-known guide and reference is written for officers and directors of homeowner associations who want to learn how to manage and operate the affairs of their associations effectively.

This easy-to-read manual is an excellent tool to understand a new home. It contains chapters covering more than 300 conditions that have been sources of disputes between homeowners and builders, offers homeowner maintenance tips, and defines the standards to which a residence should be built.

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Questions & Answers About Community Associations $18.00 Non-Member Price: $25.00 For 12 years, Jan Hickenbottom answered homeowners’ questions in her Los Angeles Times column on community associations. Now collected in one volume, readers can find answers to almost any question about CIDs.

Reserve Fund Essentials $18.00 Non-Member Price: $25.00 This book is an easy to read, musthave guide for anyone who wants a clear, thorough explanation of reserve studies and their indispensable role in effective HOA planning. The author gives tips to help board members mold their reserve study into a useful financial tool.

The Condo Owner’s $15.00 Answer Book Non-Member Price: $20.00 An excellent guide to understanding the rights and responsibilities of condo ownership and operation of homeowner associations. The question-and-answer format responds to more than 125 commonly-asked questions in an easy to understand style. A great resource for newcomers and veteran owners.

2009 ECHO Annual Seminar Program Book $15.00 Non-Member Price: $20.00 This 300+ page reference book contains the presentation outlines, text and handouts from the sessions at the 2009 ECHO Annual Seminar held on June 13, 2009. It also contains vital information for association directors, such as assessment collection policies, internal dispute policies, and much more.

Dispute Resolution in Homeowner Associations $20.00 Non-Member Price: $25.00 This publication has been completely revised to reflect new requirements resulting from passage of SB 137.

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Bookstore Order Form Board Memberâ&#x20AC;&#x2122;s Guide for Contractor Interviews $20.00 Non-Member Price: $25.00

Executive Council of Homeowners 1602 The Alameda, Suite 101, San Jose, CA 95126 Phone: 408-297-3246 Fax: 408-297-3517 TITLE

QUANTITY

This report is a guide for directors and managers to use for interviews with prospective service contractors. Questions to find out capabilities and willingness of contractors to provide the services being sought are included for most of the contractor skills that associations use.

SUBTOTAL CALIFORNIA SALES TAX (Add 9.25%) TOTAL AMOUNT

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q Check q Visa q Mastercard Credit Card Number Exp. Date

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AMOUNT

ECHO Events Calendar

Dates for your calendar Thursday, March 4 North Bay Resource Panel 11:45 a.m. Contempo Marin Clubhouses 400 Yosemite Rd., San Rafael

Wednesday, April 7 Maintenance Resource Panel 12:00 Noon ECHO Office, 1602 The Alameda, San Jose

Tuesday, March 9 Central Coast Resource Panel 12:00 Noon Pasatiempo Inn, Santa Cruz

Friday, April 9 East Bay Resource Panel 9:30 a.m. Angius & Terry 1990 N. California Blvd., Suite 950, Walnut Creek

Friday, March 12 East Bay Resource Panel 9:30 a.m. Angius & Terry 1990 N. California Blvd., Suite 950, Walnut Creek Wednesday, March 17 Wine Country Resource Panel 11:45 a.m. Eugene Burger Mgmt. Co. 6600 Hunter Dr., Rohnert Park Thursday, March 18 San Francisco Luncheon 11:45 a.m. St. Francis Yacht Club San Francisco Saturday, March 20 Wine Country Seminar 8:00 a.m. to 1:00 p.m. Rohnert Park Comm. Center 5401 Snyder Ln., Rhonert Park

Saturday, May 1 Sacramento Seminar 8:00 a.m. to 1:00 p.m. Marriott Rancho Cordova 11211 Point East Dr., Rancho Cordova

Wednesday, May 19 Wine Country Resource Panel 11:45 a.m. Eugene Burger Mgmt. Co. 6600 Hunter Dr., Rohnert Park

Thursday, May 6 North Bay Resource Panel 11:45 a.m. Contempo Marin Clubhouse 400 Yosemite Rd., San Rafael

Thursday, May 20 San Francisco Luncheon 11:45 a.m. St. Francis Yacht Club San Francisco

Wednesday, April 14 South Bay Resource Panel 12:00 Noon Il Fornaio 302 S. Market St., San Jose

Monday, May 10 Accountants Resource Panel 6:00 p.m. Francesco’s Restaurant Oakland

Friday and Saturday June 18 & 19, 2010 ECHO Annual Seminar Santa Clara Convention Center Santa Clara

Saturday, April 17 South Bay Spring Seminar 8:00 a.m. to 1:00 p.m. Campbell Community Center 1 East Campbell Ave., Campbell

Tuesday, May 11 Central Coast Resource Panel 12:00 Noon Pasatiempo Inn, Santa Cruz

Thursday, July 15 San Francisco Luncheon 11:45 a.m. St. Francis Yacht Club San Francisco

Wednesday, April 21 Wine Country Resource Panel 11:45 a.m. Eugene Burger Mgmt. Co. 6600 Hunter Dr., Rohnert Park

Friday, May 14 East Bay Resource Panel 9:30 a.m. Angius & Terry 1990 N. California Blvd., Suite 950, Walnut Creek

Thursday, September 16 San Francisco Luncheon 11:45 a.m. St. Francis Yacht Club San Francisco

Regularly Scheduled ECHO Resource Panel Meetings Resource Panel Maintenance North Bay East Bay Accountants Central Coast South Bay Wine Country Legal

March 2010 | ECHO Journal

Meeting First Wednesday, Even Months First Thursday, Odd Months Second Friday, Monthly Second Monday, Odd Months Second Tuesday, Odd Months Second Wednesday, Even Months Third Wednesday, Monthly Quarterly

Location ECHO Office, San Jose Contempo Marin Clubhouse, San Rafael Angius & Terry, Walnut Creek Francesco’s Restaurant, Oakland Pasatiempo Inn, Santa Cruz Il Fornaio, San Jose Eugene Burger Management Co., Rohnert Park Varies

ECHO Journal | March 2010

ECHO Honor Roll

About

ECHO Honors Volunteers Tyler Berding 2009 Volunteer of the Year ECHO Resource Panels Accountant Panel Richard Schnieder, CPA 707-576-7070 Central Coast Panel John Allanson 831-685-0101 East Bay Panel Scott Burke, 650-543-5619 Beth Grimm, 925-746-7177 Legal Panel Mark Wleklinski, Esq. 925-280-1191 Maintenance Panel Brian Seifert, 408-536-0420 North Bay Panel Diane Kay, CCAM, 415-846-7579 Stephany Charles, CCAM 415-458-3537 San Francisco Panel Jeff Saarman, 415-749-2700 South Bay Panel Geri Kennedy, CCAM 650-348-2691 ext. 1006 Kimberly Payne, 408-200-8470 Wine Country Panel Maria Birch, 707-584-5123

Legislative Committee Paul Atkins Jeffrey Barnett, Esq. Sandra Bonato, Esq. Jerry Bowles Joelyn Carr-Fingerle, CPA John Garvic, Esq., Chair Geri Kennedy, CCAM Wanden Treanor, Esq.

March 2010 | ECHO Journal

SF Luncheon Speakers John Allanson Jeffrey Barnett, Esq. Tyler Berding, Esq. Ronald Block, PhD. Doug Christison, PCAM, CCAM Karen Conlon, CCAM Rolf Crocker, CCAM Ross Feinberg, Esq. David Feingold, Esq. Tom Fier, Esq. Kevin Frederick, Esq. John Garvic, Esq. Beverly Gordon, CCAM Sandra Gottlieb, Esq. Beth Grimm, Esq. Brian Hebert, Esq. Roy Helsing Stephen Johnson, CFP Julia Lave Johnston Garth Leone Nico March Kerry Mazzoni Larry Russell, Esq. Steve Saarman Nathaniel Sterling, Esq. Debra Warren, PCAM, CCAM Steven Weil, Esq. Mark Wleklinski, Esq. Glenn Youngling, Esq.

Seminar Speakers September 19, 2009 Central Coast Seminar Jacquie Berry John Garvic, Esq. Linnea Juarez Lise Ström, Esq. October 17, 2009 Peninsula Fall Seminar Brian Campisi Joelyn Carr-Fingerle, CPA John Garvic, Esq. Kerry Mazzoni

January 30, 2010 Marin Seminar Sandra Bonato, Esq. David Feingold, Esq. Wanden Treanor, Esq. Glenn Youngling, Esq.

Recent ECHO Journal Contributing Authors September 2009 John Garvic, Esq Roy Helsing John Schneider October 2009 Tyler Berding, Esq. John Garvic, Esq. Geri Kennedy, CCAM Karl Lofthouse Marcia Nylander Dick Tippett November 2009 Ken Bade, PCAM Matt Malone, Esq. Ann Rankin, Esq. December 2009 Sandra Bonato, Esq. William Erlanger, CPA Lucinda Hoe Marilyn Lincoln Steven Weil, Esq. January 2010 Tyler Berding, Esq. Carl Brown Beth Grimm, Esq. Lise Ström, Esq. Richard Tippett February 2010 Beth A. Grimm, Esq. Ann Rankin, Esq. Brian Seifert

ECHO What is ECHO? ECHO (Executive Council of Homeowners) is a California non-profit corporation dedicated to assisting community associations. ECHO is an owners’ organization. Founded in San Jose in 1972 with a nucleus of five owner associations, ECHO membership is now 1,525 association members representing over 150,000 homes and 325 business and professional members.

Who Should Join ECHO? If your association manages condominiums or a planned development, it can become a member of ECHO and receive all of the benefits designated for homeowner associations. If your company wants to reach decision makers at over 1,525 homeowner associations, you can become an associate member and join 325 other firms serving this important membership.

Benefits of ECHO Membership • Subscription to monthly magazine for every board member • Yearly copy of the Association Statute Book for every board member • Frequent educational seminars • Special prices for CID publications • Legislative advocacy in Sacramento

ECHO Membership Dues HOA Size 2 to 25 units 26 to 50 units 51 to 100 units 101 to 150 units 151 to 200 units 201 or more units Business/Professional

Rate $120 $165 $240 $315 $390 $495 $425

ECHO Journal Subscription Rates Members Non-members/Homeowners Businesses & Professionals

$50 $75 $125

How Do You Join ECHO? Over 1,800 members benefit each year from their membership in ECHO. Find out what they’ve known for years by joining ECHO today. To apply for membership, call ECHO at 408-2973246 or visit the ECHO web site (echo-ca.org) to obtain an application form and for more information.

Fire Alarm Systems Fire Sprinkler Systems Testing, Service, Design & Installation

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ECHO Journal | March 2010

Install. Inspect. Protect. Campaign

Smoke Alarms Save Lives working smoke alarm is the best way of alerting residents to a fire. Smoke alarms save lives, families and firefighters. While the message is simple, statistics show that Americans need to pay more attention to not only installing, but also maintaining, the smoke alarms in their homes. A smoke alarm with a dead or missing battery is the same as no smoke alarm at all. Every year, more than 3,000 people die in home fires in the United States; most of these are in homes without a working smoke alarm. To prevent these deaths, the U.S. Fire Administration (USFA), a division of the Federal Emergency Management Agency (FEMA) is sponsoring a nationwide Install. Inspect. Protect. Campaign designed to raise awareness about how working, properly installed smoke alarms can lower a person’s chances of dying in a fire.

The Install. Inspect. Protect. Campaign is aimed at encouraging Americans to practice fire safety by 1) installing and maintaining smoke alarms and residential fire sprinklers, which can help save the lives of residents and fire fighters, 2) practicing fire escape plans, and 3) performing a home safety walk-through to remove fire hazards from the home. Install. Inspect. Protect. also recognizes firefighters and the fact that the children of firefighters want their fathers and mothers to come home safely. The campaign is promoting fire safety through a free Campaign Toolkit disc, educational 40

March 2010 | ECHO Journal

materials, print, radio and television public service announcements, children’s materials, community organization-sponsored events and a consumerfriendly campaign web site. When both smoke alarms and fire sprinklers are present in a home, the risk of dying in a fire is reduced by 82 percent, when compared to a residence without either. According to the National Fire Protection Association, between 2003–2006, almost two-thirds of home fire deaths resulted from fires in homes with no smoke alarms or no working smoke alarms. The USFA offers a few helpful tips on smoke alarms and sprinklers: • Place properly installed and maintained smoke alarms both inside and outside of sleeping areas and on every level of your home. • Get smoke alarms that can sound fast. The U.S. Fire Administration recommends that every residence and place where people sleep be equipped with both ionization and photoelectric smoke alarms or with dual sensor smoke alarms, which contain both ionization and photoelectric smoke sensors. • Test smoke alarms monthly and change alkaline batteries at least once every year, or as instructed. You can use a date you already know, like your birthday or when you change your clocks, as a reminder.

ECHO Marketplace

Adver tiser Index

The place to find business and professionals for your association Affirmative Management . . . . . . . . .16 American Asphalt . . . . . . . . . . . . . .30

2 months management fee for FREE!* We’ll beat any competitors price by 25%. More Service: calls & emails returned same day. Work completed by deadline. *Prorated Neighborhood Association Management, Inc. (800) 811-0841 x22 Dee@Neighborhoodam.com www.Neighborhoodam.com

American Management Services . . .10 Angius & Terry . . . . . . . . . . . . . . . . .3 Applied Reserve Analysis . . . . . . . . .20 AquaTek Plumbing . . . . . . . . . . . . .39 A.S.A.P. Collection Services . . . . . . . .9 Association Reserves . . . . . . . . . . .15 Bayridge Group . . . . . . . . . . . . . . . .12 Berding | Weil . . . . . . . . . . . . . . . . .44 Collins Management . . . . . . . . . . . .37 CAB/Mutual of Omaha . . . . . . . . . .14 Community Management Services . .30 Compass Management . . . . . . . . . .11 Condominium Financial Mgmnt. . . . .14 Cool Pool Service . . . . . . . . . . . . . .20 Cornerstone Community Mgmnt . . . . .8 Draeger . . . . . . . . . . . . . . . . . . . . .11 Ekim Painting . . . . . . . . . . . . . . . . .33 First Bank Association Bank Srvcs . .32 Flores Painting . . . . . . . . . . . . . . . .31 Focus Business Bank . . . . . . . . . . .10 Helsing Group . . . . . . . . . . . . . . . .12 Hill & Company. . . . . . . . . . . . . . . .20 M&C Association Services . . . . . . . .31 M. L. Nielsen Construction . . . . . . .32 Massingham and Associates . . . . . .33 Pelican Management Group . . . . . . .17 PML Management Corp. . . . . . . . . .39

• If possible, install residential fire sprinklers in your home. • Avoid painting or covering a fire sprinkler, because that will affect its sensitivity to heat. Organizations in partnership with the U.S. Fire Administration’s Install. Inspect. Protect. Campaign include the American Fire Sprinkler Association, The Burn Institute, Fire and Emergency Manufacturers and Services Association, Fire Department Safety Officers Association, Home Fire Sprinkler Coalition, Home Safety Council, International Association of Fire Chiefs,

International Association of Women in Fire & Emergency Services, National Association of State Fire Marshals, National Fallen Firefighters Foundation, National Fire Protection Association, National Fire Sprinkler Association, National Volunteer Fire Council, and Safe Kids Worldwide.

Pollard Unlimited . . . . . . . . . . . . . .33 Pro-Craft Builders . . . . . . . . . . . . . .16 Professional Association Service . . .16 R. E. Broocker Co. . . . . . . . . . . . . .22 Real Estate Property Management . .12 RealManage . . . . . . . . . . . . . . . . . .22 REMI Company . . . . . . . . . . . . . . . .15 Saarman Construction . . . . . . . . . . .9 Scuba Pool Rerpair . . . . . . . . . . . . . .8 Statcomm . . . . . . . . . . . . . . . . . . .39 Steve Tingley Painting . . . . . . . . . . . .2 Steve’s Painting Services . . . . . . . .23 Union Bank . . . . . . . . . . . . . . . . . .25

For more information on the Install. Inspect. Protect. Campaign and other fire prevention information, please visit www.usfa.dhs.gov/smokealarms. Remember to Install. Inspect. Protect… Smoke Alarms Save Lives. ECHO Journal | March 2010

Officers and Directors Update Association Presidents or Secretaries President Name

Term of Office:

to:

Address City and State

Zip:

Business phone ( Home phone (

Please complete and send to: ECHO 1602 The Alameda, Suite 101 San Jose CA 95126-2308 Tel: 408-297-3246 | Fax: 408-297-3517 Or email changes to: info@echo-ca.org

) )

Date

Association Name

Vice President

Association Address

Name:

Term of Office:

to: City

Address: Zip

City and State Business phone ( Home phone (

County

Zip

County

Zip

Management company or manager Address

)

City

)

Email:

Management phone (

Secretary

Dues statements should be mailed to:

Name

Term of Office:

)

to:

Address City and State

Zip

Business phone ( Home phone (

Please complete the items listed below. This information is for use in the ECHO Office and will assist us in the planning of future programs.

) )

1. Type of Association:

Treasurer Name

Term of Office:

to:

Address

[ ]

Condo

[ ]

2. Total Number of units: 3. Average Monthly Assessment/unit:

Zip

City and State Business phone ( Home phone (

(Please check one)

4. Annual Meeting Date: 5. Type of Management:

)

Volunteer self-management

[ ]

Management company

[ ]

On-site manager

[ ]

Other

[ ]

)

Board Member Term of Office:

Name

to:

6. Does your association have earthquake insurance? Yes [ ]

No [ ]

Address Zip

City and State Business phone ( Home phone ( Email

) )

Please provide information for additional board members on an attached sheet. Note: All officers and directors are entitled to receive copies of the ECHO newsletter. A special subscription rate of $50/year is available to those homeowners who live in an ECHO member association but are not on the board.

Avoid Making Costly Mistakes in Your Association Seminar Agenda Leading Your Association Well in 2010 8:00 Registration and Continental Breakfast

Wine Country Seminar Saturday, March 20, 2010 8:00 a.m. to 1:00 p.m.

8:45 Welcome—Oliver Burford, ECHO Executive Director 9:00 2010 Legislative Update—Barbara Zimmerman, Esq. Learn about the new laws affecting associations in 2010. In addition, learn what legislation may be coming down the pipe. 9:30 Keeping the Coffers Full—Zeke Ortiz, Marizco Landscaping; Darryl Orr, Pacific Landscapes Reducing Landscape Costs—Zeke and Darryl offer hip tips on how to reduce your association’s landscape costs. 10:15 Break 10:45 Enforcing Governing Docs—Bill Gillis, Esq. Iron Fist or Velvet Gloves?—No, you can’t just “lock ‘em up.” Is one method better than the other? Is there a middle ground? Bill will highlight the pros and cons of different approaches, preparing you to adopt the most effective policy for your association. 11:45 The ‘One Hour’ Board Meeting—Carra Clampitt, CACM It’s not a myth—Yes it can be accomplished! Learn how to orchestrate or participate in an effective, efficient and productive board meeting. You'll leave with tips on how this can be a reality for your board. 12:15 Round Table Discussions Meet the experts face-to-face—Your chance to get free advice from the experts. Go from table to table to get the information you need. 12:50 Vendor Prize Drawings 1:00 Adjourn

Rohnert Park Community Center 5401 Snyder Ln., Rohnert Park Registration Fee Members: $45 Non-Members: $55

Yes, reserve ___ spaces for the Wine Country Seminar. Amount enclosed: $__________ (attach additional names) Name: ______________________________________________________ HOA or Firm: ________________________________________________ Address: ____________________________________________________ City: __________________________ State: _____ Zip: ____________ Phone: ______________________________________________________ Visa/Mastercard No. _____________________ Exp. Date: ________ Signature: ___________________________________________________ Orders will not be processed without payment in full. Fees for cancelled registrations will not be refunded. Return with payment to: ECHO, 1602 The Alameda, STE 101, San Jose, CA 95126 Telephone: 408-297-3246; Fax: 408-297-3517

Condominium Conversions Did You Get What You Paid For?

Condo conversions are not new condominiums. They are older rental apartments that were converted to condos. So, what’s wrong with that? Nothing, if the financial plan that came with your condo is up to the task of maintaining a building with 20-30 years of deferred maintenance. How do you know? You probably don’t unless someone

has taken a close look at the homeowner association’s budget and compared it to the actual condition of the buildings. The fact is, very few condominium conversions were sold with repair budgets that are adequate to meet the needs of the project. What does this mean to you? If the budget is inadequate, it will mean either increased homeowner assessments or a gradually deterio-

rating condominium project. Or both. In either case, you didn’t get what you paid for. If you’d like to know the truth now about what you bought, call us. If you want to wait and see what happens, ok, but either way, we’ll be here when you need us. Berding | Weil, LLP 3240 Stone Valley Road West Alamo, California 94507 925-838-2090 www.berding-weil.com