BILL NUMBER: AB 1921 INTRODUCED
BILL TEXT
INTRODUCED BY Assembly Member Saldana
FEBRUARY 8, 2008
An act to amend Sections 10131.01, 10153.2, 10177, 11003, 11003.2,
11004, 11004.5, 11010.10, 11018.1, 11018.12, 11018.6, 11211.7,
11500, 11502, 11504, 11505, 23426.5, and 23428.20 of the Business and
Professions Code, to amend Sections 51.11, 714.1, 782, 782.5, 783,
783.1, 798.20, 799.10, 800.25, 895, 935, 945, 1098, 1102.6d, 1133,
1633.3, 1864, 2079.3, 2929.5, and 2955.1 of, to add Part 5
(commencing with Section 4000) to Division 4 of, and to repeal Title
6 (commencing with Section 1350) of Part 4 of Division 2 of, the
Civil Code, to amend Sections 86, 116.540, 564, 726.5, 729.035, and
736 of the Code of Civil Procedure, to amend Sections 12191, 12956.1,
12956.2, 53341.5, 65008, 65915, 65995.5, 66411, 66412, 66424, 66427,
66452.10, 66475.2, and 66477 of the Government Code, to amend
Sections 1597.531, 13132.7, 19850, 25400.22, 25915.2, 25915.5, 33050,
33435, 33436, 33769, 35811, 37630, 37923, 50955, 51602, and 116048
of the Health and Safety Code, to amend Section 790.031 of the
Insurance Code, to amend Section 2188.6 of the Revenue and Taxation
Code, and to amend Sections 21107.7, 22651, 22651.05, and 22658 of
the Vehicle Code, relating to common interest developments.
LEGISLATIVE COUNSEL'S DIGEST
AB 1921, as introduced, Saldana. Common interest developments.
The Davis-Stirling Common Interest Development Act provides for
the creation and regulation of common interest developments.
This bill would revise and recast the Davis-Stirling Common
Interest Development Act.
Existing law requires a common interest development to be governed
by an association, which may be incorporated or unincorporated.
Under existing law, a common interest development that is
incorporated is also regulated by certain provisions of law
applicable to nonprofit corporations.
This bill would provide that, in the case of an inconsistency
between the Davis-Stirling Common Interest Development Act and the
provisions of law regulating nonprofit corporations, the
Davis-Stirling Common Interest Development Act controls.
Existing law exempts from certain provisions of the Davis-Stirling
Common Interest Development Act a common interest development that
is limited to industrial or commercial uses. Existing law sets forth
specified procedures for the conduct of elections held by a common
interest development.
This bill would exempt from these election procedures a common
interest development that is limited to commercial or industrial
uses.
Existing law requires the delivery of notices in specified
circumstances to members of an association or to the board of
directors of an association. Existing law sets forth the method of
delivering those notices and provides for certain time periods that
commence with either the date of delivery or the date of receipt of a
notice.
This bill would revise those notice provisions by specifying the
manner of providing individual notice to specific persons, general
notice to all members of an association, and notice to the board of
directors. The bill would also revise procedures applicable to
undeliverable mail and would provide that delivery of a document is
complete at the time of deposit into the mail.
Existing law regulates the conduct of meetings of the board of
directors of an association.
This bill would revise those provisions with respect to their
applicability to committees exercising powers of the board, the
location of board meetings, the use of teleconferencing in board
meetings, the circumstances in which board meetings may be held in
executive session, and the ability of a board to act in writing
without holding a meeting.
Existing law regulates the conduct of meetings and elections of
the membership of an association.
This bill would revise those provisions with respect to the
location of member meetings, the use of sealed ballots in member
elections, the use of teleconferencing at member meetings, the number
of votes a member may cast, the use of unanimous written consent to
approve an action, and the procedures applicable to absentee ballots.
Existing law regulates the records retained by an association and
the inspection of those records by members.
This bill would revise those provisions with respect to the types
of records that must be retained by an association, the documents
subject to inspection, the redaction of certain information contained
in records, and the judicial enforcement of a denial of a request
for inspection.
Existing law requires the board of an association to distribute
specified reports and make certain disclosures to the members of the
association.
This bill would, instead, allow a board to deliver a notice that a
report is available and would require the board to deliver the
report to any member who so requests. The bill would require the
board to prepare a member handbook containing specified disclosures
and to deliver it to any new member and to any other member who so
requests.
Existing law places specified limitations on the ability of a
board to enter into contracts in which a director has a material
financial interest.
This bill would, in addition, prohibit a director from voting or
acting on behalf of an association with respect to certain other
matters in which the director may have an interest.
Existing law authorizes the Attorney General, in certain
circumstances, to take specified actions to protect the rights of
members of a corporation or to undo the consequences of the
corporation's failure to comply with the provisions of law regulating
corporations.
This bill would, in addition, authorize the Attorney General to
take those actions to protect the rights of members of an association
or to undo the consequences of a violation of specified provisions
of the Davis-Stirling Common Interest Development Act.
Existing law regulates the resolution of disputes between an
association and a member through alternative dispute resolution
procedures and authorizes a member to maintain a civil action to
enforce specified provisions of the Davis-Stirling Common Interest
Development Act.
This bill would revise the above provisions governing the use of
alternative dispute resolution procedures and would authorize a
member to maintain a civil action to enforce any provision of the
Davis-Stirling Common Interest Development Act.
Existing law prohibits a governing document of a common interest
development from containing certain restrictive covenants. Existing
law requires the board of an association to amend any governing
document containing such a covenant.
This bill would require, in addition, that a declaration amended
as described above be recorded and that amended articles of
incorporation be filed with the Secretary of State.
The bill would make other technical and conforming changes.
The bill would become operative on January 1, 2010.
Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 10131.01 of the Business and Professions Code
is amended to read:
10131.01. (a) Subdivision (b) of Section 10131 does not apply to
(1) the any of the following:
(1) The manager of a hotel,
motel, auto and trailer park, to the resident
manager of an apartment building, apartment complex, or court, or
to the employees of that manager , or (2)
any .
(2) Any person or entity,
including a person employed by a real estate broker, who, on behalf
of another or others, solicits or arranges, or accepts reservations
or money, or both, for transient occupancies described in paragraphs
(1) and (2) of subdivision (b) of Section 1940 of the Civil Code, in
a dwelling unit in a common interest development, as defined in
Section 1351 4100 of the Civil Code, in
a dwelling unit in an apartment building or complex, or in a
single-family home , or (3) any person other than the
resident manager or employees of that manager, performing the
following functions who is the employee of the property management
firm retained to manage a residential apartment building or complex
or court and who is performing under the supervision and control of a
broker of record who is an employee of that property management firm
or a salesperson licensed to the broker who meets certain minimum
requirements as specified in a regulation issued by the commissioner:
.
(3) (A) Any person, other than the resident manager or an employee
of that manager, who is performing the functions specified in
subparagraph (B) and to whom both of the following apply:
(i) The person is the employee of the property management firm
retained to manage a residential apartment building, complex, or
court.
(ii) The person is performing under the supervision and control of
either of the following:
(I) A broker of record who is the employee of the property
management firm retained to manage a residential apartment building,
complex, or court.
(II) A salesperson who is licensed to the broker and who meets
certain minimum requirements, as specified in a regulation issued by
the commissioner.
(B) The functions referred to in subparagraph (A) are as follows:
(A)
( i ) Showing rental units and
common areas to prospective tenants.
(B)
( ii ) Providing or accepting
preprinted rental applications, or responding to inquiries from a
prospective tenant concerning the completion of the application.
(C)
( iii ) Accepting deposits or
fees for credit checks or administrative costs and accepting security
deposits and rents.
(D)
( iv ) Providing information
about rental rates and other terms and provisions of a lease or
rental agreement, as set out in a schedule provided by an employer.
(E)
( v ) Accepting signed leases and
rental agreements from prospective tenants.
(b) A broker or salesperson shall exercise reasonable supervision
and control over the activities of nonlicensed persons acting under
paragraph (3) of subdivision (a).
(c) A broker employing nonlicensed persons to act under paragraph
(3) of subdivision (a) shall comply with Section 10163 for each
apartment building or complex or court where the nonlicensed persons
are employed.
SEC. 2. Section 10153.2 of the Business and Professions Code is
amended to read:
10153.2. (a) An applicant to take the examination for an original
real estate broker license shall also submit evidence, satisfactory
to the commissioner, of successful completion, at an accredited
institution, of:
(1) A three-semester unit course, or the quarter equivalent
thereof, in each of the following:
(A) Real estate practice.
(B) Legal aspects of real estate.
(C) Real estate appraisal.
(D) Real estate financing.
(E) Real estate economics or accounting.
(2) A three-semester unit course, or the quarter equivalent
thereof, in three of the following:
(A) Advanced legal aspects of real estate.
(B) Advanced real estate finance.
(C) Advanced real estate appraisal.
(D) Business law.
(E) Escrows.
(F) Real estate principles.
(G) Property management.
(H) Real estate office administration.
(I) Mortgage loan brokering and lending.
(J) Computer applications in real estate.
(K) On and after July 1, 2004, California law that relates to
common interest developments, including, but not limited to, topics
addressed in the Davis-Stirling Common Interest Development Act
(Title 6 (commencing with Section 1350) of Part 4 of
Division 2 (Part 5 (commencing with Section 4000) of
Division 4 of the Civil Code).
(b) The commissioner shall waive the requirements of this section
for an applicant who is a member of the State Bar of California and
shall waive the requirements for which an applicant has successfully
completed an equivalent course of study as determined under Section
10153.5.
(c) The commissioner shall extend credit under this section for
any course completed to satisfy requirements of Section 10153.3 or
10153.4.
SEC. 3. Section 10177 of the Business and Professions Code is
amended to read:
10177. The commissioner may suspend or revoke the license of a
real estate licensee, or may deny the issuance of a license to an
applicant, who has done any of the following, or may suspend or
revoke the license of a corporation, or deny the issuance of a
license to a corporation, if an officer, director, or person owning
or controlling 10 percent or more of the corporation's stock has done
any of the following:
(a) Procured, or attempted to procure, a real estate license or
license renewal, for himself or herself or a salesperson, by fraud,
misrepresentation, or deceit, or by making a material misstatement of
fact in an application for a real estate license, license renewal,
or reinstatement.
(b) Entered a plea of guilty or nolo contendere to, or been found
guilty of, or been convicted of, a felony, or a crime substantially
related to the qualifications, functions, or duties of a real estate
licensee, and the time for appeal has elapsed or the judgment of
conviction has been affirmed on appeal, irrespective of an order
granting probation following that conviction, suspending the
imposition of sentence, or of a subsequent order under Section 1203.4
of the Penal Code allowing that licensee to withdraw his or her plea
of guilty and to enter a plea of not guilty, or dismissing the
accusation or information.
(c) Knowingly authorized, directed, connived at, or aided in the
publication, advertisement, distribution, or circulation of a
material false statement or representation concerning his or her
designation or certification of special education, credential, trade
organization membership, or business, or concerning a business
opportunity or a land or subdivision, as defined in Chapter 1
(commencing with Section 11000) of Part 2, offered for sale.
(d) Willfully disregarded or violated the Real Estate Law (Part 1
(commencing with Section 10000)) or Chapter 1 (commencing with
Section 11000) of Part 2 or the rules and regulations of the
commissioner for the administration and enforcement of the Real
Estate Law and Chapter 1 (commencing with Section 11000) of Part 2.
(e) Willfully used the term "realtor" or a trade name or insignia
of membership in a real estate organization of which the licensee is
not a member.
(f) Acted or conducted himself or herself in a manner that would
have warranted the denial of his or her application for a real estate
license, or has either had a license denied or had a license issued
by another agency of this state, another state, or the federal
government revoked or suspended for acts that, if done by a real
estate licensee, would be grounds for the suspension or revocation of
a California real estate license, if the action of denial,
revocation, or suspension by the other agency or entity was taken
only after giving the licensee or applicant fair notice of the
charges, an opportunity for a hearing, and other due process
protections comparable to the Administrative Procedure Act (Chapter
3.5 (commencing with Section 11340), Chapter 4 (commencing with
Section 11370), and Chapter 5 (commencing with Section 11500) of Part
1 of Division 3 of Title 2 of the Government Code), and only upon an
express finding of a violation of law by the agency or entity.
(g) Demonstrated negligence or incompetence in performing an act
for which he or she is required to hold a license.
(h) As a broker licensee, failed to exercise reasonable
supervision over the activities of his or her salespersons, or, as
the officer designated by a corporate broker licensee, failed to
exercise reasonable supervision and control of the activities of the
corporation for which a real estate license is required.
(i) Has used his or her employment by a governmental agency in a
capacity giving access to records, other than public records, in a
manner that violates the confidential nature of the records.
(j) Engaged in any other conduct, whether of the same or a
different character than specified in this section, which constitutes
fraud or dishonest dealing.
(k) Violated any of the terms, conditions, restrictions, and
limitations contained in an order granting a restricted license.
(l) (1) Solicited or induced the sale, lease, or listing for sale
or lease of residential property on the ground, wholly or in part, of
loss of value, increase in crime, or decline of the quality of the
schools due to the present or prospective entry into the neighborhood
of a person or persons having a characteristic listed in subdivision
(a) or (d) of Section 12955 of the Government Code, as those
characteristics are defined in Sections 12926, 12926.1, subdivision
(m), and paragraph (1) of subdivision (p) of Section 12955, and
Section 12955.2 of the Government Code.
(2) Notwithstanding paragraph (1), with respect to familial
status, paragraph (1) shall not be construed to apply to housing for
older persons, as defined in Section 12955.9 of the Government Code.
With respect to familial status, nothing in paragraph (1) shall be
construed to affect Sections 51.2, 51.3, 51.4, 51.10, 51.11, and
799.5 of the Civil Code, relating to housing for senior citizens.
Subdivision (d) of Section 51 and Section 1360
5760 of the Civil Code and subdivisions (n), (o), and (p) of
Section 12955 of the Government Code shall apply to paragraph (1).
(m) Violated the Franchise Investment Law (Division 5 (commencing
with Section 31000) of Title 4 of the Corporations Code) or
regulations of the Commissioner of Corporations pertaining thereto.
(n) Violated the Corporate Securities Law of 1968 (Division 1
(commencing with Section 25000) of Title 4 of the Corporations Code)
or the regulations of the Commissioner of Corporations pertaining
thereto.
(o) Failed to disclose to the buyer of real property, in a
transaction in which the licensee is an agent for the buyer, the
nature and extent of a licensee's direct or indirect ownership
interest in that real property. The direct or indirect ownership
interest in the property by a person related to the licensee by blood
or marriage, by an entity in which the licensee has an ownership
interest, or by any other person with whom the licensee has a special
relationship shall be disclosed to the buyer.
(p) Violated Article 6 (commencing with Section 10237).
If a real estate broker that is a corporation has not done any of
the foregoing acts, either directly or through its employees, agents,
officers, directors, or persons owning or controlling 10 percent or
more of the corporation's stock, the commissioner may not deny the
issuance of a real estate license to, or suspend or revoke the real
estate license of, the corporation, provided that any offending
officer, director, or stockholder, who has done any of the foregoing
acts individually and not on behalf of the corporation, has been
completely disassociated from any affiliation or ownership in the
corporation.
SEC. 4. Section 11003 of the Business and Professions Code is
amended to read:
11003. "Planned development" has the same meaning as specified in
subdivision (k) of Section 1351 Section 4175
of the Civil Code.
SEC. 5. Section 11003.2 of the Business and Professions Code is
amended to read:
11003.2. "Stock cooperative" has the same meaning as specified in
subdivision (m) of Section 1351 Section 4190
of the Civil Code, except that, as used in this chapter, a
"stock cooperative" does not include a limited-equity housing
cooperative.
SEC. 6. Section 11004 of the Business and Professions Code is
amended to read:
11004. "Community apartment project" has the same meaning as
specified in subdivision (d) of Section 1351
Section 4105 of the Civil Code.
SEC. 7. Section 11004.5 of the Business and Professions Code is
amended to read:
11004.5. In addition to any provisions of Section 11000, the
reference in this code to "subdivided lands" and "subdivision" shall
include all of the following:
(a) Any planned development, as defined in Section 11003,
containing five or more lots.
(b) Any community apartment project, as defined by Section 11004,
containing five or more apartments.
(c) Any condominium project containing five or more condominiums,
as defined in Section 783 of the Civil Code.
(d) Any stock cooperative as defined in Section 11003.2, including
any legal or beneficial interests therein, having or intended to
have five or more shareholders.
(e) Any limited-equity housing cooperative, as defined in Section
11003.4.
(f) In addition, the following interests shall be subject to this
chapter and the regulations of the commissioner adopted pursuant
thereto:
(1) Any accompanying memberships or other rights or privileges
created in, or in connection with, any of the forms of development
referred to in subdivision (a), (b), (c), (d), or (e) by any deeds,
conveyances, leases, subleases, assignments, declarations of
restrictions, articles of incorporation, bylaws, or contracts
applicable thereto.
(2) Any interests or memberships in any owners' association as
defined in Section 1351 4080 of the
Civil Code, created in connection with any of the forms of the
development referred to in subdivision (a), (b), (c), (d), or (e).
(g) Notwithstanding this section, time-share plans, exchange
programs, incidental benefits, and short-term product subject to
Chapter 2 (commencing with Section 11210) are not "subdivisions" or
"subdivided lands" subject to this chapter.
SEC. 8. Section 11010.10 of the Business and Professions Code is
amended to read:
11010.10. A person who plans to offer for sale or lease lots or
other interests in a subdivision which sale or lease (a) is not
subject to the provisions of this chapter, (b) does not require the
submission of a notice of intention as provided in Section 11010, or
(c) is subject to this chapter and for which the local jurisdiction
requires review and approval of the declaration, as defined in
subdivision (h) of Section 1351 Section 4135
of the Civil Code, prior to or concurrently with the
recordation of the subdivision map and prior to the approval of the
declaration pursuant to a notice of intention for a public report,
may submit an application requesting review of the declaration, along
with any required supporting documentation, to the commissioner,
without the filing of a notice of intention for the subdivision for
which the declaration is being prepared. Upon approval, the
commissioner shall give notice to the applicant that the declaration
shall be approved for a subsequent notice of intent filing for any
public report for the subdivision identified in the application,
provided that the subdivision setup is substantially the same as that
originally described in the application for review of the
declaration.
SEC. 9. Section 11018.1 of the Business and Professions Code is
amended to read:
11018.1. (a) A copy of the public report of the commissioner,
when issued, shall be given to the prospective purchaser by the
owner, subdivider or agent prior to the execution of a binding
contract or agreement for the sale or lease of any lot or parcel in a
subdivision. The requirement of this section extends to lots or
parcels offered by the subdivider after repossession. A receipt shall
be taken from the prospective purchaser in a form and manner as set
forth in regulations of the Real Estate Commissioner.
(b) A copy of the public report shall be given by the owner,
subdivider or agent at any time, upon oral or written request, to any
member of the public. A copy of the public report and a statement
advising that a copy of the public report may be obtained from the
owner, subdivider or agent at any time, upon oral or written request,
shall be posted in a conspicuous place at any office where sales or
leases or offers to sell or lease lots within the subdivision are
regularly made.
(c) At the same time that a public report is required to be given
by the owner, subdivider, or agent pursuant to subdivision (a) with
respect to a common interest development, as defined, in
subdivision (c) of Section 1351 Section 4100 of
the Civil Code, the owner, subdivider, or agent shall give the
prospective purchaser a copy of the following statement:
"Common Interest Development General Information
The project described in the attached Subdivision Public Report is
known as a common-interest development. Read the public report
carefully for more information about the type of development. The
development includes common areas and facilities which
that will be owned or operated by an owners'
association. Purchase of a lot or unit automatically entitles and
obligates you as a member of the association and, in most cases,
includes a beneficial interest in the areas and facilities. Since
membership in the association is mandatory, you should be aware of
the following information before you purchase:
Your ownership in this development and your rights and remedies as
a member of its association will be controlled by governing
instruments which that generally
include a Declaration of Restrictions (also known as CC&R's),
Articles of Incorporation (or association) and bylaws. The provisions
of these documents are intended to be, and in most cases are,
enforceable in a court of law. Study these documents carefully before
entering into a contract to purchase a subdivision interest.
In order to provide funds for operation and maintenance of the
common facilities, the association will levy assessments against your
lot or unit. If you are delinquent in the payment of assessments,
the association may enforce payment through court proceedings or your
lot or unit may be liened and sold through the exercise of a power
of sale. The anticipated income and expenses of the association,
including the amount that you may expect to pay through assessments,
are outlined in the proposed budget. Ask to see a copy of the budget
if the subdivider has not already made it available for your
examination.
A homeowner association provides a vehicle for the ownership and
use of recreational and other common facilities which were designed
to attract you to buy in this development. The association also
provides a means to accomplish architectural control and to provide a
base for homeowner interaction on a variety of issues. The purchaser
of an interest in a common-interest development should contemplate
active participation in the affairs of the association. He or she
should be willing to serve on the board of directors or on committees
created by the board. In short, "they" in a common interest
development is "you." Unless you serve as a member of the governing
board or on a committee appointed by the board, your control of the
operation of the common areas and facilities is limited to your vote
as a member of the association. There are actions that can be taken
by the governing body without a vote of the members of the
association which can have a significant impact upon the quality of
life for association members.
Until there is a sufficient number of purchasers of lots or units
in a common interest development to elect a majority of the governing
body, it is likely that the subdivider will effectively control the
affairs of the association. It is frequently necessary and equitable
that the subdivider do so during the early stages of development. It
is vitally important to the owners of individual subdivision
interests that the transition from subdivider to resident-owner
control be accomplished in an orderly manner and in a spirit of
cooperation.
When contemplating the purchase of a dwelling in a common interest
development, you should consider factors beyond the attractiveness
of the dwelling units themselves. Study the governing instruments and
give careful thought to whether you will be able to exist happily in
an atmosphere of cooperative living where the interests of the group
must be taken into account as well as the interests of the
individual. Remember that managing a common interest development is
very much like governing a small community ... the management can
serve you well, but you will have to work for its success."
Failure to provide the statement in accordance with this
subdivision shall not be deemed a violation subject to Section 10185.
SEC. 10. Section 11018.12 of the Business and Professions Code is
amended to read:
11018.12. (a) The commissioner may issue a conditional public
report for a subdivision specified in Section 11004.5 if the
requirements of subdivision (e) are met, all deficiencies and
substantive inadequacies in the documents that are required to make
an application for a final public report for the subdivision
substantially complete have been corrected, the material elements of
the setup of the offering to be made under the authority of the
conditional public report have been established, and all requirements
for the issuance of a public report set forth in the regulations of
the commissioner have been satisfied, except for one or more of the
following requirements, as applicable:
(1) A final map has not been recorded.
(2) A condominium plan pursuant to subdivision (e) of
Section 1351 Section 4120 of the Civil Code has
not been recorded.
(3) A declaration of covenants, conditions, and restrictions
pursuant to Section 1353 Sections 6025, 6030,
and 6035 of the Civil Code has not been recorded.
(4) A declaration of annexation has not been recorded.
(5) A recorded subordination of existing liens to the declaration
of covenants, conditions, and restrictions or declaration of
annexation, or escrow instructions to effect recordation prior to the
first sale, are lacking.
(6) Filed articles of incorporation are lacking.
(7) A current preliminary report of a licensed title insurance
company issued after filing of the final map and recording of the
declaration covering all subdivision interests to be included in the
public report has not been provided.
(8) Other requirements the commissioner determines are likely to
be timely satisfied by the applicant, notwithstanding the fact that
the failure to meet these requirements makes the application
qualitatively incomplete.
(b) The commissioner may issue a conditional public report for a
subdivision not referred to or specified in Section 11000.1 or
11004.5 if the requirements of subdivision (e) are met, all
deficiencies and substantive inadequacies in the documents that are
required to make an application for a final public report for the
subdivision substantially complete have been corrected, the material
elements of the setup of the offering to be made under the authority
of the conditional public report have been established, and all
requirements for issuance of a public report set forth in the
regulations of the commissioner have been satisfied, except for one
or more of the following requirements, as applicable:
(1) A final map has not been recorded.
(2) A declaration of covenants, conditions, and restrictions has
not been recorded.
(3) A current preliminary report of a licensed title insurance
company issued after filing of the final map and recording of the
declaration covering all subdivision interests to be included in the
public report has not been provided.
(4) Other requirements the commissioner determines are likely to
be timely satisfied by the applicant, notwithstanding the fact that
the failure to meet these requirements makes the application
qualitatively incomplete.
(c) A decision by the commissioner to not issue a conditional
public report shall be noticed in writing to the applicant within
five business days and that notice shall specifically state the
reasons why the report is not being issued.
(d) Notwithstanding the provisions of Section 11018.2, a person
may sell or lease, or offer for sale or lease, lots or parcels in a
subdivision pursuant to a conditional public report if, as a
condition of the sale or lease or offer for sale or lease, delivery
of legal title or other interest contracted for will not take place
until issuance of a public report and provided that the requirements
of subdivision (e) are met.
(e) (1) Evidence shall be supplied that all purchase money will be
deposited in compliance with subdivision (a) of Section 11013.2 or
subdivision (a) of Section 11013.4, and in the case of a subdivision
referred to in subdivision (a) of this section, evidence shall be
given of compliance with paragraphs (1) and (2) of subdivision (a) of
Section 11018.5.
(2) A description of the nature of the transaction shall be
supplied.
(3) Provision shall be made for the return of the entire sum of
money paid or advanced by the purchaser if a subdivision public
report has not been issued during the term of the conditional public
report, or as extended, or the purchaser is dissatisfied with the
public report because of a change pursuant to Section 11012.
(f) A subdivider, principal, or his or her agent shall provide a
prospective purchaser a copy of the conditional public report and a
written statement including all of the following:
(1) Specification of the information required for issuance of a
public report.
(2) Specification of the information required in the public report
that is not available in the conditional public report, along with a
statement of the reasons why that
information is not available at the time of issuance of the
conditional public report.
(3) A statement that no person acting as a principal or agent
shall sell or lease, or offer for sale or lease, lots or parcels in a
subdivision for which a conditional public report has been issued
except as provided in this article.
(4) Specification of the requirements of subdivision (e).
(g) The prospective purchaser shall sign a receipt that he or she
has received and has read the conditional public report and the
written statement provided pursuant to subdivision (f).
(h) The term of a conditional public report shall not exceed six
months, and may be renewed for one additional term of six months if
the commissioner determines that the requirements for issuance of a
public report are likely to be satisfied during the renewal term.
(i) The term of a conditional public report for attached
residential condominium units, as defined pursuant to Section 783 of
the Civil Code, consisting of 25 units or more as specified on the
approved tentative tract map, shall not exceed 30 months and may be
renewed for one additional term of six months if the commissioner
determines that the requirements for issuance of a public report are
likely to be satisfied during the renewal term.
SEC. 11. Section 11018.6 of the Business and Professions Code is
amended to read:
11018.6. Any person offering to sell or lease any interest
subject to the requirements of subdivision (a) of Section 11018.1 in
a subdivision described in Section 11004.5 shall make a copy of each
of the following documents available for examination by a prospective
purchaser or lessee before the execution of an offer to purchase or
lease and shall give a copy thereof to each purchaser or lessee as
soon as practicable before transfer of the interest being acquired by
the purchaser or lessee:
(a) The declaration of covenants, conditions, and restrictions for
the subdivision.
(b) Articles of incorporation or association for the subdivision
owners association.
(c) Bylaws for the subdivision owners association.
(d) Any other instrument which that
establishes or defines the common, mutual, and reciprocal rights, and
responsibilities of the owners or lessees of interests in the
subdivision as shareholders or members of the subdivision owners
association or otherwise.
(e) To the extent available, the current financial information and
related statements as specified in subdivision (a) of
Section 1365 Sections 4800 and 5560 of the Civil
Code, for subdivisions subject to those provisions.
(f) A statement prepared by the governing body of the association
setting forth the outstanding delinquent assessments and related
charges levied by the association against the subdivision interests
in question under authority of the governing instruments for the
subdivision and association.
SEC. 12. Section 11211.7 of the Business and Professions Code is
amended to read:
11211.7. (a) Any time-share plan registered pursuant to this
chapter to which the Davis-Stirling Common Interest Development Act
(Chapter 1 (commencing with Section 1350) of Part 4 of
Division 2 (Part 5 (commencing with Section 4000) of
Division 4 of the Civil Code) might otherwise apply is exempt
from that act, except for Sections 1354, 1355, 1355.5, 1356,
1357, 1358, 1361, 1361.5, 1362, 1363.05, 1364, 1365.5, 1370, and
1371 the following provisions of the
Civil Code . :
(1) Sections 4520, 4525, 4540, and
4550.
(2) Section 4620.
(3) Section 5125.
(4) Subdivision (d) of Section 5500.
(5) Subdivision (b) of Section 5510.
(6) Sections 5515 to 5520, inclusive.
(7) Section 5550.
(8) Subdivision (a) of, and paragraphs (1), (3), and (4) of
subdivision (b) of, Section 5555.
(9) Article 1 (commencing with Section 5700) of Chapter 6 of Part
5 of Division 4.
(10) Article 1 (commencing with Section 5800) of Chapter 7 of Part
5 of Division 4.
(11) Article 5 (commencing with Section 5925) of Chapter 7 of Part
5 of Division 4.
(12) Article 7 (commencing with Section 6175) of Chapter 8 of Part
5 of Division 4.
(13) Sections 6040 to 6050, inclusive.
(b) (1) To the extent that a single site time-share plan or
component site of a multisite time-share plan located in the state is
structured as a condominium or other common interest development,
and there is any inconsistency between the applicable provisions of
this chapter and the Davis-Stirling Common Interest Development Act,
the applicable provisions of this chapter shall control.
(2) To the extent that a time-share plan is part of a mixed use
project where the time-share plan comprises a portion of a
condominium or other common interest development, the applicable
provisions of this chapter shall apply to that portion of the project
uniquely comprising the time-share plan, and the Davis-Stirling
Common Interest Development Act shall apply to the project as a
whole.
(c) (1) The offering of any time-share plan, exchange program,
incidental benefit, or short term product in this state that is
subject to the provisions of this chapter shall be exempt from
Sections 1689.5 to 1689.14, inclusive, of the Civil Code (Home
Solicitation Sales), Sections 1689.20 to 1689.24, inclusive, of the
Civil Code (Seminar Sales), and Sections 1812.100 to 1812.129,
inclusive, of the Civil Code (Contracts for Discount Buying
Services).
(2) A developer or exchange company that, in connection with a
time-share sales presentation or offer to arrange an exchange, offers
a purchaser the opportunity to utilize the services of an affiliate,
subsidiary, or third-party entity in connection with wholesale or
retail air or sea transportation, shall not, in and of itself, cause
the developer or exchange company to be considered a seller of travel
subject to Sections 17550 to 17550.34, inclusive, of the Business
and Professions Code, so long as the entity that actually provides or
arranges the air or sea transportation is registered as a seller of
travel with the California Attorney General's office or is otherwise
exempt under those sections.
(d) To the extent certain sections in this chapter require
information and disclosure that by their terms only apply to real
property time-share plans, those requirements shall not apply to
personal property time-share plans.
SEC. 13. Section 11500 of the Business and Professions Code is
amended to read:
11500. For purposes of this chapter, the following definitions
apply:
(a) "Common interest development" means a residential development
identified in subdivision (c) of Section 1351
Section 4100 of the Civil Code.
(b) "Association" has the same meaning as defined in
subdivision (a) of Section 1351 Section 4080 of
the Civil Code.
(c) "Financial services" means acts performed or offered to be
performed, for compensation, for an association, including, but not
limited to, the preparation of internal unaudited financial
statements, internal accounting and bookkeeping functions, billing of
assessments, and related services.
(d) "Management services" means acts performed or offered to be
performed in an advisory capacity for an association including, but
not limited to, the following:
(1) Administering or supervising the collection, reporting, and
archiving of the financial or common area assets of an association or
common interest development, at the direction of the association's
board of directors.
(2) Implementing resolutions and directives of the board of
directors of the association elected to oversee the operation of a
common interest development.
(3) Implementing provisions of governing documents, as defined in
Section 1351 4150 of the Civil Code,
that govern the operation of the common interest development.
(4) Administering association contracts, including insurance
contracts, within the scope of the association's duties or with other
common interest development managers, vendors, contractors, and
other third-party providers of goods and services to an association
or common interest development.
(e) "Professional association for common interest development
managers" means an organization that meets all of the following:
(1) Has at least 200 members or certificants who are common
interest development managers in California.
(2) Has been in existence for at least five years.
(3) Operates pursuant to Section 501(c) of the Internal Revenue
Code.
(4) Certifies that a common interest development manager has met
the criteria set forth in Section 11502 without requiring membership
in the association.
(5) Requires adherence to a code of professional ethics and
standards of practice for certified common interest development
managers.
SEC. 14. Section 11502 of the Business and Professions Code is
amended to read:
11502. In order to be called a "certified common interest
development manager," a person shall meet one of the following
requirements:
(a) Prior to July 1, 2003, has passed a knowledge, skills, and
aptitude examination as specified in Section 11502.5 or has been
granted a certification or a designation by a professional
association for common interest development managers, and who has,
within five years prior to July 1, 2004, received instruction in
California law pursuant to paragraph (1) of subdivision (b).
(b) On or after July 1, 2003, has successfully completed an
educational curriculum that shall be no less than a combined 30 hours
in coursework described in this subdivision and passed an
examination or examinations that test competence in common interest
development management in the following areas:
(1) The law that relates to the management of common interest
developments, including, but not limited to, the following courses of
study:
(A) Topics covered by the Davis-Stirling Common Interest
Development Act, contained in Title 6 (commencing with
Section 1350) of Part 4 of Division 2 Part 5
(commencing with Section 40 00) of Division 4 of the
Civil Code, including, but not limited to, the types of California
common interest developments, disclosure requirements pertaining to
common interest developments, meeting requirements, financial
reporting requirements, and member access to association records.
(B) Personnel issues, including, but not limited to, general
matters related to independent contractor or employee status, the
laws on harassment, the Unruh Civil Rights Act, the California Fair
Employment and Housing Act, and the Americans with Disabilities Act.
(C) Risk management, including, but not limited to, insurance
coverage, maintenance, operations, and emergency preparedness.
(D) Property protection for associations, including, but not
limited to, pertinent matters relating to environmental hazards such
as asbestos, radon gas, and lead-based paint, the Vehicle Code, local
and municipal regulations, family day care facilities, energy
conservation, Federal Communications Commission rules and
regulations, and solar energy systems.
(E) Business affairs of associations, including, but not limited
to, necessary compliance with federal, state, and local law.
(F) Basic understanding of governing documents, codes, and
regulations relating to the activities and affairs of associations
and common interest developments.
(2) Instruction in general management that is related to the
managerial and business skills needed for management of a common
interest development, including, but not limited to, the following:
(A) Finance issues, including, but not limited to, budget
preparation; management; administration or supervision of the
collection, reporting, and archiving of the financial or common area
assets of an association or common interest development; bankruptcy
laws; and assessment collection.
(B) Contract negotiation and administration.
(C) Supervision of employees and staff.
(D) Management of maintenance programs.
(E) Management and administration of rules, regulations, and
parliamentary procedures.
(F) Management and administration of architectural standards.
(G) Management and administration of the association's
recreational programs and facilities.
(H) Management and administration of owner and resident
communications.
(I) Training and strategic planning for the association's board of
directors and its committees.
(J) Implementation of association policies and procedures.
(K) Ethics, professional conduct, and standards of practice for
common interest development managers.
(L) Current issues relating to common interest developments.
(M) Conflict avoidance and resolution mechanisms.
SEC. 15. Section 11504 of the Business and Professions Code is
amended to read:
11504. On or before September 1, 2003, and annually thereafter, a
person who either provides or contemplates providing the services of
a common interest development manager to an association shall
disclose to the board of directors of the association the following
information:
(a) Whether or not the common interest development manager has met
the requirements of Section 11502 so he or she may be called a
certified common interest development manager.
(b) The name, address, and telephone number of the professional
association that certified the common interest development manager,
the date the manager was certified, and the status of the
certification.
(c) The location of his or her primary office.
(d) Prior to entering into or renewing a contract with an
association, the common interest development manager shall disclose
to the board of directors of the association or common interest
development whether the fidelity insurance of the common interest
development manager or his or her employer covers the current year's
operating and reserve funds of the association. This requirement
shall not be construed to compel an association to require a common
interest development manager to obtain or maintain fidelity
insurance.
(e) Whether the common interest development manager possesses an
active real estate license.
This section may not preclude a common interest development
manager from disclosing information as required in Section
1363.1 4900 of the Civil Code.
SEC. 16. Section 11505 of the Business and Professions Code is
amended to read:
11505. It is an unfair business practice for a common interest
development manager, a company that employs the common interest
development manager, or a company that is controlled by a company
that also has a financial interest in a company employing that
manager, to do any of the following:
(a) On or after July 1, 2003, to hold oneself out or use the title
of "certified common interest development manager" or any other term
that implies or suggests that the person is certified as a common
interest development manager without meeting the requirements of
Section 11502.
(b) To state or advertise that he or she is certified, registered,
or licensed by a governmental agency to perform the functions of a
certified common interest development manager.
(c) To state or advertise a registration or license number, unless
the license or registration is specified by a statute, regulation,
or ordinance.
(d) To fail to comply with any item to be disclosed in Section
11504 of this code, or Section 1363.1 4900
of the Civil Code.
SEC. 17. Section 23426.5 of the Business and Professions Code is
amended to read:
23426.5. (a) For purposes of this article, "club" also means any
tennis club that maintains not less than four regulation tennis
courts, together with the necessary facilities and clubhouse, has
members paying regular monthly dues, has been in existence for not
less than 45 years, and is not associated with a common interest
development as defined in Section 1351 4100
of the Civil Code, a community apartment project as defined in
Section 11004 of this code, a project consisting of condominiums as
defined in Section 783 of the Civil Code, or a mobilehome park as
defined in Section 18214 of the Health and Safety Code.
(b) It shall be unlawful for any club licensed pursuant to this
section to make any discrimination, distinction, or restriction
against any person on account of age or any characteristic listed or
defined in subdivision (b) or (e) of Section 51 of the Civil Code.
SEC. 18. Section 23428.20 of the Business and Professions Code is
amended to read:
23428.20. (a) For the purposes of this article, "club" also means
any bona fide nonprofit corporation that has been in existence for
not less than nine years, has more than 8,500 memberships issued and
outstanding to owners of condominiums and owners of memberships in
stock cooperatives, and owns, leases, operates, or maintains
recreational facilities for its members.
(b) For the purposes of this article, "club" also means any bona
fide nonprofit corporation that was formed as a condominium
homeowners' association, has at least 250 members, has served daily
meals to its members and guests for a period of not less than 12
years, owns or leases, operates, and maintains a clubroom or rooms
for its membership, has an annual fee of not less than nine hundred
dollars ($900) per year per member, and has as a condition of
membership that one member of each household be at least 54 years
old.
(c) Section 23399 and the numerical limitation of Section 23430
shall not apply to a club defined in this section.
(d) No license shall be issued pursuant to this section to any
club that withholds membership or denies facilities or services to
any person on account of any basis listed in subdivision (a) or (d)
of Section 12955 of the Government Code, as those bases are defined
in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of
subdivision (p) of Section 12955, and Section 12955.2 of the
Government Code.
(e) Notwithstanding subdivision (d), with respect to familial
status, subdivision (d) shall not be construed to apply to housing
for older persons, as defined in Section 12955.9 of the Government
Code. With respect to familial status, nothing in subdivision (d)
shall be construed to affect Sections 51.2, 51.3, 51.4, 51.10, 51.11,
and 799.5 of the Civil Code, relating to housing for senior
citizens. Subdivision (d) of Section 51 and Section 1360
5760 of the Civil Code and subdivisions (n),
(o), and (p) of Section 12955 of the Government Code shall apply to
subdivision (d).
SEC. 19. Section 51.11 of the Civil Code is amended to read:
51.11. (a) The Legislature finds and declares that this section
is essential to establish and preserve housing for senior citizens.
There are senior citizens who need special living environments, and
find that there is an inadequate supply of this type of housing in
the state.
(b) For the purposes of this section, the following definitions
apply:
(1) "Qualifying resident" or "senior citizen" means a person 62
years of age or older, or 55 years of age or older in a senior
citizen housing development.
(2) "Qualified permanent resident" means a person who meets both
of the following requirements:
(A) Was residing with the qualifying resident or senior citizen
prior to the death, hospitalization, or other prolonged absence of,
or the dissolution of marriage with, the qualifying resident or
senior citizen.
(B) Was 45 years of age or older, or was a spouse, cohabitant, or
person providing primary physical or economic support to the
qualifying resident or senior citizen.
(3) "Qualified permanent resident" also means a disabled person or
person with a disabling illness or injury who is a child or
grandchild of the senior citizen or a qualified permanent resident as
defined in paragraph (2) who needs to live with the senior citizen
or qualified permanent resident because of the disabling condition,
illness, or injury. For purposes of this section, "disabled" means a
person who has a disability as defined in subdivision (b) of Section
54. A "disabling injury or illness" means an illness or injury
which that results in a condition
meeting the definition of disability set forth in subdivision (b) of
Section 54.
(A) For any person who is a qualified permanent resident under
paragraph (3) whose disabling condition ends, the owner, board of
directors, or other governing body may require the formerly disabled
resident to cease residing in the development upon receipt of six
months' written notice; provided, however, that the owner, board of
directors, or other governing body may allow the person to remain a
resident for up to one year, after the disabling condition ends.
(B) The owner, board of directors, or other governing body of the
senior citizen housing development may take action to prohibit or
terminate occupancy by a person who is a qualified permanent resident
under paragraph (3) if the owner, board of directors, or other
governing body finds, based on credible and objective evidence, that
the person is likely to pose a significant threat to the health or
safety of others that cannot be ameliorated by means of a reasonable
accommodation; provided, however, that action to prohibit or
terminate the occupancy may be taken only after doing both of the
following:
(i) Providing reasonable notice to and an opportunity to be heard
for the disabled person whose occupancy is being challenged, and
reasonable notice to the coresident parent or grandparent of that
person.
(ii) Giving due consideration to the relevant, credible, and
objective information provided in that hearing. The evidence shall be
taken and held in a confidential manner, pursuant to a closed
session, by the owner, board of directors, or other governing body in
order to preserve the privacy of the affected persons.
The affected persons shall be entitled to have present at the
hearing an attorney or any other person authorized by them to speak
on their behalf or to assist them in the matter.
(4) "Senior citizen housing development" means a residential
development developed with more than 20 units as a senior community
by its developer and zoned as a senior community by a local
governmental entity, or characterized as a senior community in its
governing documents, as these are defined in Section 1351
4150 , or qualified as a senior community under
the federal Fair Housing Amendments Act of 1988, as amended. Any
senior citizen housing development which that
is required to obtain a public report under Section 11010 of
the Business and Professions Code and which
that submits its application for a public report after July 1,
2001, shall be required to have been issued a public report as a
senior citizen housing development under Section 11010.05 of the
Business and Professions Code.
(5) "Dwelling unit" or "housing" means any residential
accommodation other than a mobilehome.
(6) "Cohabitant" refers to persons who live together as husband
and wife, or persons who are domestic partners within the meaning of
Section 297 of the Family Code.
(7) "Permitted health care resident" means a person hired to
provide live-in, long-term, or terminal health care to a qualifying
resident, or a family member of the qualifying resident providing
that care. For the purposes of this section, the care provided by a
permitted health care resident must be substantial in nature and must
provide either assistance with necessary daily activities or medical
treatment, or both.
A permitted health care resident shall be entitled to continue his
or her occupancy, residency, or use of the dwelling unit as a
permitted resident in the absence of the senior citizen from the
dwelling unit only if both of the following are applicable:
(A) The senior citizen became absent from the dwelling due to
hospitalization or other necessary medical treatment and expects to
return to his or her residence within 90 days from the date the
absence began.
(B) The absent senior citizen or an authorized person acting for
the senior citizen submits a written request to the owner, board of
directors, or governing board stating that the senior citizen desires
that the permitted health care resident be allowed to remain in
order to be present when the senior citizen returns to reside in the
development.
Upon written request by the senior citizen or an authorized person
acting for the senior citizen, the owner, board of directors, or
governing board shall have the discretion to allow a permitted health
care resident to remain for a time period longer than 90 days from
the date that the senior citizen's absence began, if it appears that
the senior citizen will return within a period of time not to exceed
an additional 90 days.
(c) The covenants, conditions, and restrictions and other
documents or written policy shall set forth the limitations on
occupancy, residency, or use on the basis of age. Any such limitation
shall not be more exclusive than to require that one person in
residence in each dwelling unit may be required to be a senior
citizen and that each other resident in the same dwelling unit may be
required to be a qualified permanent resident, a permitted health
care resident, or a person under 55 years of age whose occupancy is
permitted under subdivision (g) of this section or subdivision (b) of
Section 51.12. That limitation may be less exclusive, but shall at
least require that the persons commencing any occupancy of a dwelling
unit include a senior citizen who intends to reside in the unit as
his or her primary residence on a permanent basis. The application of
the rules set forth in this subdivision regarding limitations on
occupancy may result in less than all of the dwellings being actually
occupied by a senior citizen.
(d) The covenants, conditions, and restrictions or other documents
or written policy shall permit temporary residency, as a guest of a
senior citizen or qualified permanent resident, by a person of less
than 55 years of age for periods of time, not more than 60 days in
any year, that are specified in the covenants, conditions, and
restrictions or other documents or written policy.
(e) Upon the death or dissolution of marriage, or upon
hospitalization, or other prolonged absence of the qualifying
resident, any qualified permanent resident shall be entitled to
continue his or her occupancy, residency, or use of the dwelling unit
as a permitted resident. This subdivision shall not apply to a
permitted health care resident.
(f) The covenants, conditions, and
restrictions or other documents or written policies applicable to any
condominium, stock cooperative, limited-equity housing cooperative,
planned development, or multiple-family residential property that
contained age restrictions on January 1, 1984, shall be enforceable
only to the extent permitted by this section, notwithstanding lower
age restrictions contained in those documents or policies.
(g) Any person who has the right to reside in, occupy, or use the
housing or an unimproved lot subject to this section on or after
January 1, 1985, shall not be deprived of the right to continue that
residency, occupancy, or use as the result of the enactment of this
section by Chapter 1147 of the Statutes of 1996.
(h) A housing development may qualify as a senior citizen housing
development under this section even though, as of January 1, 1997, it
does not meet the definition of a senior citizen housing development
specified in subdivision (b), if the development complies with that
definition for every unit that becomes occupied after January 1,
1997, and if the development was once within that definition, and
then became noncompliant with the definition as the result of any one
of the following:
(1) The development was ordered by a court or a local, state, or
federal enforcement agency to allow persons other than qualifying
residents, qualified permanent residents, or permitted health care
residents to reside in the development.
(2) The development received a notice of a pending or proposed
action in, or by, a court, or a local, state, or federal enforcement
agency, which action could have resulted in the development being
ordered by a court or a state or federal enforcement agency to allow
persons other than qualifying residents, qualified permanent
residents, or permitted health care residents to reside in the
development.
(3) The development agreed to allow persons other than qualifying
residents, qualified permanent residents, or permitted health care
residents to reside in the development by entering into a
stipulation, conciliation agreement, or settlement agreement with a
local, state, or federal enforcement agency or with a private party
who had filed, or indicated an intent to file, a complaint against
the development with a local, state, or federal enforcement agency,
or file an action in a court.
(4) The development allowed persons other than qualifying
residents, qualified permanent residents, or permitted health care
residents to reside in the development on the advice of counsel in
order to prevent the possibility of an action being filed by a
private party or by a local, state, or federal enforcement agency.
(i) The covenants, conditions, and restrictions or other documents
or written policy of the senior citizen housing development shall
permit the occupancy of a dwelling unit by a permitted health care
resident during any period that the person is actually providing
live-in, long-term, or hospice health care to a qualifying resident
for compensation.
(j) This section shall only apply to the County of Riverside.
SEC. 20. Section 714.1 of the Civil Code is amended to read:
714.1. Notwithstanding Section 714, any association, as defined
in Section 1351 4080 , may impose
reasonable provisions which that :
(a) Restrict the installation of solar energy systems installed in
common areas, as defined in Section 1351
4095 , to those systems approved by the association.
(b) Require the owner of a separate interest, as defined in
Section 1351 4185 , to obtain the
approval of the association for the installation of a solar energy
system in a separate interest owned by another.
(c) Provide for the maintenance, repair, or replacement of roofs
or other building components.
(d) Require installers of solar energy systems to indemnify or
reimburse the association or its members for loss or damage caused by
the installation, maintenance, or use of the solar energy system.
SEC. 21. Section 782 of the Civil Code is amended to read:
782. (a) Any provision in any deed of real property in
California, whether executed before or after the effective date of
this section, that purports to restrict the right of any persons to
sell, lease, rent, use or occupy the property to persons having any
characteristic listed in subdivision (a) or (d) of Section 12955 of
the Government Code, as those bases are defined in Sections 12926,
12926.1, subdivision (m) and paragraph (1) of subdivision (p) of
Section 12955 and Section 12955.2 of the Government Code, by
providing for payment of a penalty, forfeiture, reverter, or
otherwise, is void.
(b) Notwithstanding subdivision (a), with respect to familial
status, subdivision (a) shall not be construed to apply to housing
for older persons, as defined in Section 12955.9 of the Government
Code. With respect to familial status, nothing in subdivision (a)
shall be construed to affect Sections 51.2, 51.3, 51.4, 51.10, 51.11,
and 799.5, relating to housing for senior citizens. Subdivision (d)
of Section 51 and Section 1360 5760 of
this code and subdivisions (n), (o), and (p) of Section 12955 of the
Government Code shall apply to subdivision (a).
SEC. 22. Section 782.5 of the Civil Code is amended to read:
782.5. (a) Any deed or other written instrument that relates to
title to real property, or any written covenant, condition, or
restriction annexed or made a part of, by reference or otherwise, any
such deed or instrument, that contains any provision that purports
to forbid, restrict, or condition the right of any person or persons
to sell, buy, lease, rent, use, or occupy the property on account of
any basis listed in subdivision (a) or (d) of Section 12955 of the
Government Code, as those bases are defined in Sections 12926,
12926.1, subdivision (m) and paragraph (1) of subdivision (p) of
Section 12955, and Section 12955.2 of the Government Code, with
respect to any person or persons, shall be deemed to be revised to
omit that provision.
(b) Notwithstanding subdivision (a), with respect to familial
status, subdivision (a) shall not be construed to apply to housing
for older persons, as defined in Section 12955.9 of the Government
Code. With respect to familial status, nothing in subdivision (a)
shall be construed to affect Sections 51.2, 51.3, 51.4, 51.10, 51.11,
and 799.5, relating to housing for senior citizens. Subdivision (d)
of Section 51 and Section 1360 5760 of
this code and subdivisions (n), (o), and (p) of Section 12955 of the
Government Code shall apply to subdivision (a).
(c) This section shall not be construed to limit or expand the
powers of a court to reform a deed or other written instrument.
SEC. 23. Section 783 of the Civil Code is amended to read:
783. A condominium is an estate in real property described in
subdivision (f) of Section 1351 Section 4115
. A condominium may, with respect to the duration of its
enjoyment, be either (1) an estate of inheritance or perpetual
estate, (2) an estate for life, (3) an estate for years, such as a
leasehold or a subleasehold, or (4) any combination of the foregoing.
SEC. 24. Section 783.1 of the Civil Code is amended to read:
783.1. In a stock cooperative, as defined in subdivision
(m) of Section 1351 Section 4190 , both the
separate interest, as defined in paragraph (4) of
subdivision ( ) of Section 1351
Section 4185 , and the correlative interest in the stock
cooperative corporation, however designated, are interests in real
property.
SEC. 25. Section 798.20 of the Civil Code is amended to read:
798.20. (a) Membership in any private club or organization that
is a condition for tenancy in a park shall not be denied on any basis
listed in subdivision (a) or (d) of Section 12955 of the Government
Code, as those bases are defined in Sections 12926, 12926.1,
subdivision (m) and paragraph (1) of subdivision (p) of Section
12955, and Section 12955.2 of the Government Code.
(b) Notwithstanding subdivision (a), with respect to familial
status, subdivision (a) shall not be construed to apply to housing
for older persons, as defined in Section 12955.9 of the Government
Code. With respect to familial status, nothing in subdivision (a)
shall be construed to affect Sections 51.2, 51.3, 51.4, 51.10, 51.11,
and 799.5, relating to housing for senior citizens. Subdivision (d)
of Section 51 and Section 1360 5760 of
this code and subdivisions (n), (o), and (p) of Section 12955 of the
Government Code shall apply to subdivision (a).
SEC. 26. Section 799.10 of the Civil Code is amended to read:
799.10. A resident may not be prohibited from displaying a
political campaign sign relating to a candidate for election to
public office or to the initiative, referendum, or recall process in
the window or on the side of a manufactured home or mobilehome, or
within the site on which the home is located or installed. The size
of the face of a political sign may not exceed six square feet, and
the sign may not be displayed in excess of a period of time from 90
days prior to an election to 15 days following the election, unless a
local ordinance within the jurisdiction where the manufactured home
or mobilehome subject to this article is located imposes a more
restrictive period of time for the display of such a sign. In the
event of a conflict between the provisions of this section and the
provisions of Title 6 (commencing with Section 1350) of Part
4 of Division 2 Part 5 (commencing with Section 4000)
of Division 4 , relating to the size and display of political
campaign signs, the provisions of this section shall prevail.
SEC. 27. Section 800.25 of the Civil Code is amended to read:
800.25. (a) Membership in any private club or organization that
is a condition for tenancy in a floating home marina shall not be
denied on any basis listed in subdivision (a) or (d) of Section 12955
of the Government Code, as those bases are defined in Sections
12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p)
of Section 12955, and Section 12955.2 of the Government Code.
(b) Notwithstanding subdivision (a), with respect to familial
status, subdivision (a) shall not be construed to apply to housing
for older persons, as defined in Section 12955.9 of the Government
Code. With respect to familial status, nothing in subdivision (a)
shall be construed to affect Sections 51.2, 51.3, 51.4, 51.10, 51.11,
and 799.5, relating to housing for senior citizens. Subdivision (d)
of Section 51 and Section 1360 5760 of
this code and subdivisions (n), (o), and (p) of Section 12955 of the
Government Code shall apply to subdivision (a).
SEC. 28. Section 895 of the Civil Code is amended to read:
895. (a) "Structure" means any residential dwelling, other
building, or improvement located upon a lot or within a common area.
(b) "Designed moisture barrier" means an installed moisture
barrier specified in the plans and specifications, contract
documents, or manufacturer's recommendations.
(c) "Actual moisture barrier" means any component or material,
actually installed, that serves to any degree as a barrier against
moisture, whether or not intended as such.
(d) "Unintended water" means water that passes beyond, around, or
through a component or the material that is designed to prevent that
passage.
(e) "Close of escrow" means the date of the close of escrow
between the builder and the original homeowner. With respect to
claims by an association, as defined in subdivision (a) of
Section 1351 Section 4080 , "close of escrow"
means the date of substantial completion, as defined in Section
337.15 of the Code of Civil Procedure, or the date the builder
relinquishes control over the association's ability to decide whether
to initiate a claim under this title, whichever is later.
(f) "Claimant" or "homeowner" includes the individual owners of
single-family homes, individual unit owners of attached dwellings
and, in the case of a common interest development, any association as
defined in subdivision (a) of Section 1351
Section 4080 .
SEC. 29. Section 935 of the Civil Code is amended to read:
935. To the extent that provisions of this chapter are enforced
and those provisions are substantially similar to provisions in
Section 1375 of the Civil Code 6200 ,
but an action is subsequently commenced under Section 1375
of the Civil Code 6200 , the parties are excused
from performing the substantially similar requirements under Section
1375 of the Civil Code 6200 .
SEC. 30. Section 945 of the Civil Code is amended to read:
945. The provisions, standards, rights, and obligations set forth
in this title are binding upon all original purchasers and their
successors-in-interest. For purposes of this title, associations and
others having the rights set forth in Sections 1368.3 and
1368.4 4410 and 4415 shall be considered to be
original purchasers and shall have standing to enforce the
provisions, standards, rights, and obligations set forth in this
title.
SEC. 31. Section 1098 of the Civil Code is amended to read:
1098. A "transfer fee" is any fee payment requirement imposed
within a covenant, restriction, or condition contained in any deed,
contract, security instrument, or other document affecting the
transfer or sale of, or any interest in, real property that requires
a fee be paid upon transfer of the real property. A transfer fee does
not include any of the following:
(a) Fees or taxes imposed by a governmental entity.
(b) Fees pursuant to mechanics' liens.
(c) Fees pursuant to court-ordered transfers, payments, or
judgments.
(d) Fees pursuant to property agreements in connection with a
legal separation or dissolution of marriage.
(e) Fees, charges, or payments in connection with the
administration of estates or trusts pursuant to Division 7
(commencing with Section 7000), Division 8 (commencing with Section
13000), or Division 9 (commencing with Section 15000) of the Probate
Code.
(f) Fees, charges, or payments imposed by lenders or purchasers of
loans, as these entities are described in subdivision (c) of Section
10232 of the Business and Professions Code.
(g) Assessments, charges, penalties, or fees authorized by the
Davis-Stirling Common Interest Development Act (Title 6
(commencing with Section 1350) of Part 4) (Part 5
(commencing with Section 4000) of Division 4) .
(h) Fees, charges, or payments for failing to comply with, or for
transferring the real property prior to satisfying, an obligation to
construct residential improvements on the real property.
(i) Any fee reflected in a document recorded against the property
on or before December 31, 2007, that is separate from any covenants,
conditions, and restrictions, and that substantially complies with
subdivision (a) of Section 1098.5 by providing a prospective
transferee notice of the following:
(1) Payment of a transfer fee is required.
(2) The amount or method of calculation of the fee.
(3) The date or circumstances under which the transfer fee payment
requirement expires, if any.
(4) The entity to which the fee will be paid.
(5) The general purposes for which the fee will be used.
SEC. 32. Section 1102.6d of the Civil Code is amended to read:
1102.6d. Except for manufactured homes and mobilehomes located in
a common interest development governed by Title 6
(commencing with Section 1351) Part 5 (commencing with
Section 4000) of Division 4 , the disclosures applicable to
the resale of a manufactured home or mobilehome pursuant to
subdivision (b) of Section 1102 are set forth in, and shall be made
on a copy of, the following disclosure form:
SEC. 33. Section 1133 of the Civil Code is amended to read:
1133. (a) If a lot, parcel, or unit of a subdivision is subject
to a blanket encumbrance, as defined in Section 11013 of the Business
and Professions Code, but is exempt from a requirement of compliance
with Section 11013.2 of the Business and Professions Code, the
subdivider, his or her agent, or representative, shall not sell, or
lease for a term exceeding five years, the lot, parcel, or unit, nor
cause it to be sold, or leased for a term exceeding five years, until
the prospective purchaser or lessee of the lot, parcel, or unit has
been furnished with and has signed a true copy of the following
notice:
BUYER/LESSEE IS AWARE OF THE FACT THAT THE LOT, PARCEL, OR UNIT
WHICH HE OR SHE IS PROPOSING TO PURCHASE OR LEASE IS SUBJECT TO A
DEED OF TRUST, MORTGAGE, OR OTHER LIEN KNOWN AS A "BLANKET
ENCUMBRANCE".
IF BUYER/LESSEE PURCHASES OR LEASES THIS LOT, PARCEL, OR UNIT, HE
OR SHE COULD LOSE THAT INTEREST THROUGH FORECLOSURE OF THE BLANKET
ENCUMBRANCE OR OTHER LEGAL PROCESS EVEN THOUGH BUYER/LESSEE IS NOT
DELINQUENT IN HIS OR HER PAYMENTS OR OTHER OBLIGATIONS UNDER THE
MORTGAGE, DEED OF TRUST, OR LEASE.
______ ________________
Date Signature of
Buyer or Lessee
(b) "Subdivision," as used in subdivision (a), means improved or
unimproved land that is divided or proposed to be divided for the
purpose of sale, lease, or financing, whether immediate or future,
into two or more lots, parcels, or units and includes a condominium
project, as defined in subdivision (f) of Section 1351
Section 4125 , a community apartment project, as
defined in subdivision (d) of Section 1351
Section 4105 , a stock cooperative, as defined in
subdivision (m) of Section 1351 Section 4190 ,
and a limited equity housing cooperative, as defined in
subdivision (m) of Section 1351 Section 4190 .
(c) The failure of the buyer or lessee to sign the notice shall
not invalidate any grant, conveyance, lease, or encumbrance.
(d) Any person or entity who willfully violates the provisions of
this section shall be liable to the purchaser of a lot or unit
which that is subject to the provisions
of this section, for actual damages, and in addition thereto, shall
be guilty of a public offense punishable by a fine in an amount not
to exceed five hundred dollars ($500). In an action to enforce
such that liability or fine, the
prevailing party shall be awarded reasonable attorney's fees.
SEC. 34. Title 6 (commencing with Section 1350) of Part 4 of
Division 2 of the Civil Code is repealed.
SEC. 35. Section 1633.3 of the Civil Code is amended to read:
1633.3. (a) Except as otherwise provided in subdivisions (b) and
(c), this title applies to electronic records and electronic
signatures relating to a transaction.
(b) This title does not apply to transactions subject to the
following laws:
(1) A law governing the creation and execution of wills, codicils,
or testamentary trusts.
(2) Division 1 (commencing with Section 1101) of the Uniform
Commercial Code, except Sections 1107 and 1206.
(3) Divisions 3 (commencing with Section 3101), 4 (commencing with
Section 4101), 5 (commencing with Section 5101), 8 (commencing with
Section 8101), 9 (commencing with Section 9101), and 11 (commencing
with Section 11101) of the Uniform Commercial Code.
(4) A law that requires that specifically identifiable text or
disclosures in a record or a portion of a record be separately
signed, including initialed, from the record. However, this paragraph
does not apply to Section 1677 or 1678 of this code or Section 1298
of the Code of Civil Procedure.
(c) This title does not apply to any specific transaction
described in Section 17511.5 of the Business and Professions Code,
Section 56.11, 56.17, 798.14, 1133, or 1134 of, Sections
1350 to 1376, inclusive, of, Section 1134,
1689.6, 1689.7, or 1689.13 of, Chapter 2.5 (commencing with Section
1695) of Title 5 of Part 2 of Division 3 of, Section 1720, 1785.15,
1789.14, 1789.16, 1789.33, or 1793.23 of, Chapter 1 (commencing with
Section 1801) of Title 2 of Part 4 of Division 3 of, Section 1861.24,
1862.5, 1917.712, 1917.713, 1950.5, 1950.6, 1983, 2924b, 2924c,
2924f, 2924i, 2924j, 2924.3, or 2937 of, Article 1.5 (commencing with
Section 2945) of Chapter 2 of Title 14 of Part 4 of Division 3 of,
Section 2954.5 or 2963 of, Chapter 2b (commencing with Section 2981)
or 2d (commencing with Section 2985.7) of Title 14 of Part 4 of
Division 3 of, or Section 3071.5 of, or Part
5 (commencing with Section 4000) of Division 4 of, the Civil
Code, subdivision (b) of Section 18608 or Section 22328 of the
Financial Code, Section 1358.15, 1365, 1368.01, 1368.1, 1371, or
18035.5 of the Health and Safety Code, Section 658, 662, 663, 664,
666, 667.5, 673, 677, 678, 678.1, 786, 10083, 10086, 10087, 10102,
10113.7, 10127.7, 10127.9, 10127.10, 10197, 10199.44, 10199.46,
10235.16, 10235.40, 10509.4, 10509.7, 11624.09, or 11624.1 of the
Insurance Code, Section 779.1, 10010.1, or 16482 of the Public
Utilities Code, or Section 9975 or 11738 of the Vehicle Code. An
electronic record may not be substituted for any notice that is
required to be sent pursuant to Section 1162 of the Code of Civil
Procedure. Nothing in this subdivision shall be construed to prohibit
the recordation of any document with a county recorder by electronic
means.
(d) This title applies to an electronic record or electronic
signature otherwise excluded from the application of this title under
subdivision (b) when used for a transaction subject to a law other
than those specified in subdivision (b).
(e) A transaction subject to this title is also subject to other
applicable substantive law.
(f) The exclusion of a transaction from the application of this
title under subdivision (b) or (c) shall be construed only to exclude
the transaction from the application of this title, but shall not be
construed to prohibit the transaction from being conducted by
electronic means if the transaction may be conducted by electronic
means under any other applicable law.
SEC. 36. Section 1864 of the Civil Code is amended to read:
1864. Any person or entity, including a person employed by a real
estate broker, who, on behalf of another or others, solicits or
arranges, or accepts reservations or money, or both, for transient
occupancies described in paragraphs (1) and (2) of subdivision (b) of
Section 1940, in a dwelling unit in a common interest development,
as defined in Section 1351 4100 , in a
dwelling unit in an apartment building or complex, or in a
single-family home, shall do each of the following:
(a) Prepare and maintain, in accordance with a written agreement
with the owner, complete and accurate records and books of account,
kept in accordance with generally accepted accounting principles, of
all reservations made and money received and spent with respect to
each dwelling unit. All money received shall be kept in a trust
account maintained for the benefit of owners of the dwelling units.
(b) Render, monthly, to each owner of the dwelling unit, or to
that owner's designee, an accounting for each month in which there
are any deposits or disbursements on behalf of that owner, however,
in no event shall this accounting be rendered any less frequently
than quarterly.
(c) Make all records and books of account with respect to a
dwelling unit available, upon reasonable advance notice, for
inspection and copying by the dwelling unit's owner. The records
shall be maintained for a period of at least three years.
(d) Comply fully with all collection, payment, and recordkeeping
requirements of a transient occupancy tax ordinance, if any,
applicable to the occupancy.
(e) In no event shall any activities described in this section
subject the person or entity performing those activities in any
manner to Part 1 (commencing with Section 10000) of Division 4 of the
Business and Professions Code. However, a real estate licensee
subject to this section may satisfy the requirements of this section
by compliance with the Real Estate Law.
SEC. 37. Section 2079.3 of the Civil Code is amended to read:
2079.3. The inspection to be performed pursuant to this article
does not include or involve an inspection of areas that are
reasonably and normally inaccessible to such an
that type of inspection, nor an affirmative inspection of
areas off the site of the subject property or public records or
permits concerning the title or use of the property, and, if the
property comprises a unit in a planned development as defined in
Section 11003 of the Business and Professions Code, a condominium as
defined in Section 783, or a stock cooperative as defined in Section
11003.2 of the Business and Professions Code, does not include an
inspection of more than the unit offered for sale, if the seller or
the broker complies with the provisions of Section 1368
5825 .
SEC. 38. Section 2929.5 of the Civil Code is amended to read:
2929.5. (a) A secured lender may enter and inspect the real
property security for the purpose of determining the existence,
location, nature, and magnitude of any past or present release or
threatened release of any hazardous substance into, onto, beneath, or
from the real property security on either of the following:
(1) Upon reasonable belief of the existence of a past or present
release or threatened release of any hazardous substance into, onto,
beneath, or from the real property security not previously disclosed
in writing to the secured lender in conjunction with the making,
renewal, or modification of a loan, extension of credit, guaranty, or
other obligation involving the borrower.
(2) After the commencement of nonjudicial or judicial foreclosure
proceedings against the real property security.
(b) The secured lender shall not abuse the right of entry and
inspection or use it to harass the borrower or tenant of the
property. Except in case of an emergency, when the borrower or tenant
of the property has abandoned the premises, or if it is
impracticable to do so, the secured lender shall give the borrower or
tenant of the property reasonable notice of the secured lender's
intent to enter, and enter only during the borrower's or tenant's
normal business hours. Twenty-four hours' notice shall be presumed to
be reasonable notice in the absence of evidence to the contrary.
(c) The secured lender shall reimburse the borrower for the cost
of repair of any physical injury to the real property security caused
by the entry and inspection.
(d) If a secured lender is refused the right of entry and
inspection by the borrower or tenant of the property, or is otherwise
unable to enter and inspect the property without a breach of the
peace, the secured lender may, upon petition,
obtain an order from a court of competent
jurisdiction to exercise the secured lender's rights under
subdivision (a), and that action shall not constitute an action
within the meaning of subdivision (a) of Section 726 of the Code of
Civil Procedure.
(e) For purposes of this section:
(1) "Borrower" means the trustor under a deed of trust, or a
mortgagor under a mortgage, where the deed of trust or mortgage
encumbers real property security and secures the performance of the
trustor or mortgagor under a loan, extension of credit, guaranty, or
other obligation. The term includes any successor-in-interest of the
trustor or mortgagor to the real property security before the deed of
trust or mortgage has been discharged, reconveyed, or foreclosed
upon.
(2) "Hazardous substance" includes all of the following:
(A) Any "hazardous substance" as defined in subdivision (h) of
Section 25281 of the Health and Safety Code.
(B) Any "waste" as defined in subdivision (d) of Section 13050 of
the Water Code.
(C) Petroleum, including crude oil or any fraction thereof,
natural gas, natural gas liquids, liquefied natural gas, or synthetic
gas usable for fuel, or any mixture thereof.
(3) "Real property security" means any real property and
improvements, other than a separate interest and any related interest
in the common area of a residential common interest development, as
the terms "separate interest," "common area," and "common interest
development" are defined in Section 1351
Sections 4185, 4095, and 4100, respectively , or real property
consisting of one acre or less which that
contains 1 to 15 dwelling units.
(4) "Release" means any spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, leaching,
dumping, or disposing into the environment, including continuing
migration, of hazardous substances into, onto, or through soil,
surface water, or groundwater.
(5) "Secured lender" means the beneficiary under a deed of trust
against the real property security, or the mortgagee under a mortgage
against the real property security, and any successor-in-interest of
the beneficiary or mortgagee to the deed of trust or mortgage.
SEC. 39. Section 2955.1 of the Civil Code is amended to read:
2955.1. (a) Any lender originating a loan secured by the borrower'
s separate interest in a condominium project, as defined in
subdivision (f) of Section 1351 Section 4125 ,
which requires earthquake insurance or imposes a fee or any other
condition in lieu thereof pursuant to an underwriting requirement
imposed by an institutional third-party purchaser shall disclose all
of the following to the potential borrower:
(1) That the lender or the institutional third party in question
requires earthquake insurance or imposes a fee or any other condition
in lieu thereof pursuant to an underwriting requirement imposed by
an institutional third party purchaser.
(2) That not all lenders or institutional third parties require
earthquake insurance or impose a fee or any other condition in lieu
thereof pursuant to an underwriting requirement imposed by an
institutional third party purchaser.
(3) Earthquake insurance may be required on the entire condominium
project.
(4) That lenders or institutional third parties may also require
that a condominium project maintain, or demonstrate an ability to
maintain, financial reserves in the amount of the earthquake
insurance deductible.
(b) For the purposes of this section, "institutional third party"
means the Federal Home Loan Mortgage Corporation, the Federal
National Mortgage Association, the Government National Mortgage
Association, and other substantially similar institutions, whether
public or private.
(c) The disclosure required by this section shall be made in
writing by the lender as soon as reasonably practicable.
SEC. 40. Part 5 (commencing with Section 4000) is added to
Division 4 of the Civil Code, to read:
PART 5. Common Interest Developments
CHAPTER 1. PRELIMINARY PROVISIONS
Article 1. General Provisions
4000. This part shall be known and may be cited as the
Davis-Stirling Common Interest Development Act.
4005. Division, part, title, chapter, and article headings do not
in any manner affect the scope, meaning, or intent of this part.
4010. (a) A provision of this part, insofar as it is
substantially the same as a previously existing provision relating to
the same subject matter, shall be considered as a restatement and
continuation thereof and not as a new enactment, and a reference in a
statute to the provision of this part shall be deemed to include a
reference to the previously existing provision unless a contrary
intent appears.
(b) A reference in an association's governing documents to a
former provision that is restated and continued in this part shall be
deemed to include a reference to the provision of this part that
restates and continues the former provision.
4015. (a) This part applies to a common interest development.
(b) Nothing in this part may be construed to apply to a
development that does not include common area.
4020. (a) The following provisions do not apply to a common
interest development that is limited to industrial or commercial uses
by zoning or by a declaration of covenants, conditions, and
restrictions that is recorded in the official records of each county
in which the common interest development is located:
(1) Section 4025.
(2) Section 4620.
(3) Article 4 (commencing with Section 4625) of Chapter 3.
(4) Article 7 (commencing with Section 4800) of Chapter 3.
(5) Article 2 (commencing with Section 5510) of Chapter 5.
(6) Article 3 (commencing with Section 5550) of Chapter 5.
(7) Subdivision (b) of Section 5575.
(8) Section 5580.
(9) Section 5900.
(10) Article 2 (commencing with Section 5825) of Chapter 7.
(11) Section 5775.
(12) Article 5 (commencing with Section 6100) of Chapter 8.
(b) The Legislature finds that the provisions listed in
subdivision (a) are appropriate to protect purchasers in residential
common interest developments but may not be necessary to protect
purchasers in commercial or industrial developments. Those provisions
could result in unnecessary burdens and costs for nonresidential
developments.
4025. (a) Except as otherwise provided, an association that is
incorporated is governed by this part and by the Corporations Code.
(b) The following provisions of the Corporations Code do not apply
to an association, unless a provision of this part expressly
provides otherwise:
(1) Sections 5211 and 7211.
(2) Chapter 5 (commencing with Section 5510) of Part 2 of, and
Chapter 5 (commencing with Section 7510) of Part 3 of, Division 2.
(3) Sections 5610, 5611, 5612, 5615, 5617, 7610, 7611, 7612, 7614,
and 7616.
(4) Chapter 13 (commencing with Section 6310) of Part 2 of, and
Chapter 13 (commencing with Section 8310) of Part 3 of, Division 2.
(c) An association that is not incorporated is governed by this
part and by any provision of the Corporations Code that is applicable
pursuant to this part.
(d) If a provision of this part conflicts with a provision of the
Corporations Code, the provision of this part prevails to the extent
of the inconsistency.
4030. Unless a contrary intent is clearly expressed, a local
zoning ordinance is construed to treat like structures, lots,
parcels, areas, or spaces in like manner regardless of whether the
common interest development is a community apartment project,
condominium project, planned development, or stock cooperative.
4035. If a provision of this part requires that a document be
"delivered to the board" the document shall be delivered by one of
the following methods:
(a) By first-class mail, postage prepaid, to the person designated
in the member handbook (Section 4810) to receive documents on behalf
of the association. If no person has been designated to receive
documents, the document shall be delivered to the president or
secretary of the association.
(b) By personal delivery to a director at a meeting of the board.
4040. (a) If a provision of this part requires "individual
notice," the notice shall be delivered to the person to be notified
by one of the following methods:
(1) Personal delivery.
(2) First-class mail, postage prepaid, addressed to the person at
the address last shown on the books of the association or otherwise
provided by the person.
(3) E-mail, facsimile, or other electronic means, if the person
has agreed to that method of delivery.
(4) Any other method of delivery that is reasonably calculated to
provide actual notice to the person.
(b) A member may request in writing that a notice to that member
be sent to up to two different addresses.
(c) For the purposes of this section, a provision of the operating
rules, articles, or bylaws of the association that provides for a
particular method of delivery does not constitute agreement by a
member of the association to that method of delivery.
4045. (a) If a provision of this part requires "general notice,"
the notice shall be provided to all members by one or more of the
following methods:
(1) Any method provided for delivery of an individual notice
(Section 4040).
(2) Inclusion in a billing statement, newsletter, or other
document that is delivered by one of the methods provided in this
section.
(3) Posting in a location that is accessible to all members,
including on an Internet Web site, if the location has been
designated in the member handbook (Section 4810) for the posting of
general notices by the association.
(4) Publication in a periodical that is circulated primarily to
members of the association.
(5) If the association broadcasts television programming for the
purpose of distributing information on association business to its
members, by inclusion in the programming.
(b) Notwithstanding subdivision (a), if a member requests that
general notice to the member be delivered as an individual notice, a
general notice to the member shall be delivered as an individual
notice (Section 4040). The option provided in this subdivision shall
be described in the member handbook (Section 4810).
4050. (a) This section governs the delivery of a document
pursuant to this part.
(b) If a document is delivered by mail, delivery is complete at
the time of deposit into the mail.
(c) If a document is delivered by electronic mail, facsimile, or
other electronic means, delivery is complete at the time of
transmission.
(d) An affidavit of delivery of a notice, which is executed by the
secretary, assistant secretary, or managing agent of the
association, is prima facie evidence of delivery.
4055. (a) If a notice to a member is returned by the United
States Postal Service marked to indicate that the United States
Postal Service is unable to deliver the notice to the member at the
given address, the association shall deliver that notice and any
future notices to that member to the address of a separate interest
owned by the member.
(b) If electronic delivery of a notice to a member fails, the
association shall deliver that notice by other means, and shall not
deliver any future notice to that member electronically, unless the
member provides a new address or the association determines that a
technical problem with the given address has been corrected.
4060. If a provision of this part requires that an action be
approved by the board, the action shall be approved or ratified by
the vote of the board or by the vote of a committee authorized to
exercise the powers of the board, pursuant to Article 2 (commencing
with Section 4500) of Chapter 3.
4065. If a provision of this part requires that an action be
approved by a majority of all members, the action shall be approved
or ratified by an affirmative vote of members representing more than
50 percent of the total voting power of the association, or if the
governing documents of an association divide the members into two or
more classes for the purposes of voting, by an affirmative vote of
members representing more than 50 percent of the voting power in each
class that is required to approve the action.
4070. If a provision of this part requires that an action be
approved by a majority of a quorum of the members, the action shall
be approved or ratified by an affirmative vote of members
representing more than 50 percent of the votes cast in an election at
which a quorum is achieved, or if the governing documents of an
association divide the members into two or more classes for the
purposes of voting, by an affirmative vote of members representing
more than 50 percent of the votes cast in an election at which a
quorum is achieved, in each class that is required to approve the
action.
Article 2. Definitions
4075. Unless the provision or context otherwise requires, the
definitions in this article govern the construction of this part.
4080. "Association" means a nonprofit corporation or
unincorporated association created for the purpose of managing a
common interest development.
4085. "Board" means the board of directors of an association.
4090. "Board meeting" means a congregation of directors
constituting a quorum at the same time and place to hear, discuss, or
deliberate upon any business scheduled to be heard by the board.
4095. (a) "Common area" means the entire common interest
development except the separate interests therein.
(b) The estate in the common area may be a fee, a life estate, an
estate for years, or any combination of the foregoing.
(c) In a planned development, common area may consist of mutual or
reciprocal easement rights appurtenant to the separate interests.
4100. (a) "Common interest development" means a real property
development in which a separate interest is coupled with either of
the following:
(1) An undivided interest in all or part of the common area.
(2) Membership in an association that owns all or part of the
common area.
(b) In a development where there is no common area other than that
established by mutual or reciprocal easement rights appurtenant to
the separate interests, "common interest development" means a
development in which a separate interest is coupled with membership
in an association with the power to enforce an obligation of an owner
of a separate interest with respect to the beneficial use and
enjoyment of common area by means of an assessment that may become a
lien upon the separate interest.
(c) "Common interest development" includes all of the following
types of developments:
(1) A community apartment project.
(2) A condominium project.
(3) A planned development.
(4) A stock cooperative.
4105. "Community apartment project" means a real property
development in which a right of exclusive occupancy of an apartment
is coupled with an undivided interest in the development as a whole.
4110. (a) "Community service organization" means a nonprofit
entity, other than the association, that is organized to provide
services to residents of a common interest development or to the
public in addition to the residents, to the extent that the common
area is available to the public.
(b) "Community service organization" does not include an entity
that has been organized solely to raise moneys and contribute to
other nonprofit organizations that are qualified as tax exempt under
Section 501(c)(3) of the Internal Revenue Code and that provide
housing or housing assistance.
4115. "Condominium" means a separate interest in a condominium
project, coupled with an undivided interest in all or part of the
common area of the condominium project.
4120. "Condominium plan" means a plan of the type described in
Section 6075.
4125. (a) "Condominium project" means a real property development
in which ownership of a separate interest is coupled with an
undivided interest in all or part of the common area.
(b) The undivided interest in the common area and the separate
interest may be a specified three-dimensional space filled with air,
earth, or water, or any combination thereof, and need not be
physically attached to land except by easements for access and, if
necessary, support.
(c) The boundaries of the common area shall be described on a
recorded final map, parcel map, or condominium plan.
(d) The boundaries of the separate interests shall be described on
a recorded final map, parcel map, or condominium plan. A description
of a separate interest may refer to (1) boundaries described in the
recorded final map, parcel map, or condominium plan, (2) physical
boundaries, either in existence, or to be constructed, such as walls,
floors, and ceilings of a structure or any portion thereof, (3) an
entire structure containing one or more separate interests, or (4)
any combination thereof.
(e) An individual condominium within a condominium project may
include, in addition, a separate interest in other portions of the
real property.
4130. "Declarant" means the person or group of persons designated
in the declaration as the declarant, or if no declarant is
designated, the person or group of persons who sign the original
declaration or who succeed to special rights, preferences, or
privileges designated in the declaration as belonging to the person
who signed the original declaration.
4135. "Declaration" means the document, however denominated, that
contains information that is substantially equivalent to the
information required by Section 6025.
4140. "Director" means a natural person elected, designated, or
selected to serve on the board.
4145. (a) "Exclusive use common area" means a part of the common
area designated by the declaration or pursuant to Section 5900, to be
used exclusively by one or more, but fewer than all, of the members.
The right of exclusive use is appurtenant to the separate interests
of those members.
(b) Unless the declaration provides otherwise, shutters, awnings,
window boxes, doorsteps, stoops, porches, balconies, patios, exterior
doors, doorframes, and hardware incident thereto, screens and
windows or other fixtures designed to serve a single separate
interest, but located outside the boundaries of the separate
interest, are exclusive use common areas allocated exclusively to
that separate interest.
(c) Notwithstanding the provisions of the declaration, internal
and external communication wiring designed to serve a single separate
interest, but located outside the boundaries of the separate
interest, are exclusive use common areas allocated exclusively to
that separate interest. For the purposes of this section, "wiring"
includes nonmetallic transmission lines.
4150. "Governing documents" means the declaration, bylaws,
articles of incorporation or association, operating rules, and any
other documents that govern the operation of the common interest
development or association.
4155. (a) "Managing agent" means a person who, for compensation
or in expectation of compensation, exercises control over the assets
of a common interest development.
(b) "Managing agent" does not include either of the following:
(1) A full-time employee of the association.
(2) A regulated financial institution operating within the normal
course of its regulated business practice.
4160. "Member" means either of the following persons:
(a) An owner of a separate interest in a common interest
development.
(b) A person that is designated as a member in the declaration,
articles, or bylaws. The incidents of a membership established under
this paragraph may be limited by the document that establishes the
membership.
4163. "Member election" means a vote of the members on a matter
that requires the approval of the members. "Member election" does not
include a vote of the board or other appointed or elected body.
4165. "Operating rule" means a regulation adopted by the board
that applies generally to the management and operation of the common
interest development or the conduct of the business and affairs of
the association.
4170. "Person" means an individual, corporation, government or
governmental subdivision or agency, business trust, estate, trust,
partnership, limited liability company, association, or other entity.
4175. "Planned development" means a real property development of
any of the following types:
(a) A development, other than a condominium project, in which
ownership of a separate interest is coupled with an undivided
interest in the common area.
(b) A development in which ownership of a separate interest is
coupled with: (1) membership in an association that owns the common
area, and (2) an appurtenant right to the beneficial use and
enjoyment of the common area.
(c) If the common area consists entirely of mutual or reciprocal
easement rights appurtenant to the separate interests, a development
in which separate ownership of a specified part of the development is
coupled with membership in an association that has the power to
enforce an obligation of an owner of a separate interest with respect
to the beneficial use and enjoyment of the common area by means of
an assessment that may become a lien upon the separate interests in
accordance with Article 5 (commencing with Section 5600) of Chapter
5.
4180. "Rule change" means the adoption, amendment, or repeal of
an operating rule by the board.
4185. (a) In a community apartment project, "separate interest"
means the exclusive right to occupy an apartment.
(b) In a condominium project, "separate interest" means a
separately owned unit.
(c) In a planned development, "separate interest" means a
separately owned lot, parcel, area, or space.
(d) In a stock cooperative, "separate interest" means the
exclusive right to occupy a portion of the real property.
(e) Unless the declaration or a condominium plan otherwise
provides, if walls, floors, or ceilings are designated as boundaries
of a separate interest, the interior surfaces of the perimeter walls,
floors, ceilings, windows, doors, and outlets located within the
separate interest are part of the separate interest and any other
portions of the walls, floors, or ceilings are part of the common
area.
(f) The estate in a separate interest may be a fee, a life estate,
an estate for years, or any combination of the foregoing.
4190. (a) "Stock cooperative" means a real property development
in which a right of exclusive occupancy of a specified part of the
development is coupled with an ownership interest in a corporation
that is formed or availed of primarily for the purpose of holding
title to the development as a whole, either in fee simple or for a
term of years.
(b) An owner's interest in the corporation, whether evidenced by a
share of stock, a certificate of membership, a lease, or otherwise,
is deemed to be an interest in a common interest development and a
real estate development for purposes of subdivision (f) of Section
25100 of the Corporations Code.
(c) It is not necessary that all shareholders of the corporation
receive a right of exclusive occupancy of a specified part of the
development.
(d) A "stock cooperative" includes a limited equity housing
cooperative that meets the criteria of Section 33007.5 of the Health
and Safety Code.
CHAPTER 2. MEMBER BILL OF RIGHTS (RESERVED)
CHAPTER 3. COMMUNITY ASSOCIATION GOVERNANCE
Article 1. Association Existence and Powers
4400. A common interest development shall be governed by an
association, which may be incorporated or unincorporated.
4405. (a) Whether incorporated or unincorporated, an association
may exercise the following powers:
(1) The powers granted in this part.
(2) Unless the governing documents provide otherwise, the powers
granted to a nonprofit mutual benefit corporation pursuant to Section
7140 of the Corporations Code.
(b) Notwithstanding subdivision (a), an unincorporated association
may not adopt or use a corporate seal or issue membership
certificates in accordance with Section 7313 of the Corporations
Code.
4410. An association has standing to institute, defend, settle,
or intervene in litigation, arbitration, mediation, or administrative
proceedings in its own name as the real party in interest and
without joining with it the members of the association, in matters
pertaining to the following:
(a) Enforcement of the governing documents.
(b) Damage to the common area.
(c) Damage to a separate interest that the association is
obligated to maintain or repair.
(d) Damage to a separate interest that arises out of, or is
integrally related to, damage to the common area or a separate
interest that the association is obligated to maintain or repair.
4415. (a) In an action maintained by an association pursuant to
subdivision (b), (c), or (d) of Section 4410, the amount of damages
recovered by the association shall be reduced by the amount of
damages allocated to the association or its managing agents in direct
proportion to their percentage of fault based upon principles of
comparative fault.
(b) The comparative fault of the association or its managing
agents may be raised by way of defense, but shall not be the basis
for a cross-action or separate action against the association or its
managing agents for contribution or implied indemnity, where the only
damage was sustained by the association or its members.
(c) It is the intent of the Legislature in enacting this section
to require that comparative fault be pleaded as an affirmative
defense, rather than a separate cause of action, where the only
damage was sustained by the association or its members.
(d) In an action involving damages described in subdivision (b),
(c), or (d) of Section 4410, the defendant or cross-defendant may
allege and prove the comparative fault of the association or its
managing agents as a setoff to the liability of the defendant or
cross-defendant even if the association is not a party to the
litigation or is no longer a party whether by reason of settlement,
dismissal, or otherwise.
(e) This section applies to actions commenced on or after January
1, 1993.
(f) Nothing in this section affects a person's liability under
Section 1431, or the liability of the association or its managing
agent for an act or omission that causes damages to another.
4420. Except as expressly provided by statute, the rights of
members provided in this chapter may not be limited by contract or by
the governing documents.
Article 2. Board Meeting
4500. This article shall be known and may be cited as the Common
Interest Development Open Meeting Act.
4505. (a) Unless the governing documents provide otherwise, a
board meeting may be called by the board chair, the president, the
vice president, the secretary, or any two directors.
(b) Unless the governing documents provide otherwise, a majority
of the directors present at a meeting, whether or not a quorum is
present, may adjourn the meeting to another time and place.
4510. Unless the governing documents provide otherwise, a
majority of the total number of directors authorized by the governing
documents constitutes a quorum. The governing documents may not
provide for a quorum that is less than one-fifth of the number of
directors authorized, or less than two directors, whichever is
larger.
4515. (a) Except as otherwise provided by law, an action approved
by a majority of directors present at a meeting at which a quorum is
present is the action of the board. The governing documents may
specify a higher percentage for approval of a board action, but may
not specify a lower percentage.
(b) Unless the governing documents provide otherwise, a meeting at
which a quorum is initially present may continue to transact
business notwithstanding the withdrawal of directors, if any action
taken is approved by either a majority of the required quorum or, if
a higher percentage is required by law or the governing documents, by
that higher percentage.
4520. (a) Unless the time and place of a meeting is fixed by the
governing documents, the association shall provide general notice
(Section 4045) of a board meeting, and shall provide individual
notice (Section 4040) of the board meeting to directors and to any
association member who has requested notice of meetings. The notice
shall state the time and place of the board meeting and shall include
an agenda for the board meeting.
(b) Unless the governing documents provide for a longer period of
notice, the association shall deliver notice of a board meeting at
least four days before the meeting.
(c) The president of the association, or two directors other than
the president, may call an emergency board meeting if there are
circumstances that could not have been reasonably foreseen, that
require immediate attention and possible action by the board, so that
it would be impracticable to give notice pursuant to this section.
Advance notice of an emergency board meeting is not required.
(d) Unless the governing documents provide otherwise, if a meeting
is adjourned to another time and place for more than 24 hours, the
association shall provide notice of the time and place at which the
meeting will reconvene, by general notice (Section 4045), and by
individual notice (Section 4040) to a director who was not present at
the meeting and to any member who has requested notice of board
meetings. The notice shall be delivered before the meeting
reconvenes.
(e) Unless the governing documents provide otherwise, notice of a
meeting need not be given to a director who does any of the
following:
(1) Provides a written waiver of notice. The waiver shall be filed
with the association records or made part of the minutes of the
meeting.
(2) Provides a written consent to holding the meeting or approving
the minutes of the meeting. The consent shall be filed with the
association records or made part of the minutes of the meeting.
(3) Attends the meeting without protesting the lack of notice,
either before the meeting or at the meeting.
4525. (a) Any member may attend and speak at a board meeting,
except for any part of the meeting held in executive session.
(b) The board may set a reasonable time limit for member testimony
at a board meeting.
4528. (a) Except as otherwise provided in this section, the board
may not discuss or take action on any item at a meeting unless the
item was placed on the agenda included in the notice provided
pursuant to Section 4520.
(b) This section does not preclude any of the following from being
raised at a meeting, even if the matter is not on the agenda:
(1) A statement or question of a resident of the development other
than a director.
(2) A brief response to statements made or questions posed by a
resident other than a director.
(3) A request for clarification.
(4) A brief announcement.
(5) A brief report on a director's own activities.
(c) A board or director, acting in compliance with any rules or
procedures provided in the governing documents, may take any of the
following actions at a meeting, even if the action was not on the
agenda:
(1) Provide a reference to, or provide other resources for factual
information to, a managing agent, other agent, or staff.
(2) Request a managing agent, other agent, or staff to report back
to the board at a subsequent meeting concerning any matter.
(3) Direct a managing agent, other agent, or staff to place a
matter of business on a future agenda.
(4) Direct a managing agent, other agent, or staff to perform
administrative tasks that are necessary to carry out this section.
(d) The board may take action on an item of business that is not
on the agenda if the board openly identifies the item to the members
present at the meeting and one or more of the following conditions is
satisfied:
(1) A majority of the directors present at the meeting determines
that an emergency situation exists. For the purposes of this
paragraph, an emergency situation exists if there are circumstances
that could not have been reasonably foreseen by the board, that
require immediate attention and possible action by the board, and
that, of necessity, make it impracticable to provide notice.
(2) The board determines that there is a need to take immediate
action and that the need for action came to the attention of the
board after notice of the meeting was delivered. This determination
may only be made by the affirmative vote of two-thirds of the
directors present at the meeting, or, if fewer than two-thirds of the
directors are present at the meeting, by a unanimous vote of all
directors present at the meeting.
(3) The item appeared on the agenda of a prior board meeting, was
taken up at that meeting, and was continued for action at a later
meeting. An item cannot be continued under this paragraph to a
meeting that takes place more than 30 days after the meeting at which
the item was originally considered.
4530. A board meeting shall be held within the common interest
development unless the board determines that a larger meeting room is
required than is available within the common interest development. A
board meeting held outside of the common interest development shall
be held as close to the common interest development as is
practicable.
4535. (a) If all of the following conditions are satisfied, a
director who is not physically present at the noticed location of a
board meeting may participate in the meeting by teleconference:
(1) Each director participating in the meeting can communicate
with all other directors concurrently.
(2) Each director participating in the meeting is provided the
means of participating in all matters before the board, including the
ability to propose or interpose an objection to a specific action
taken by the board.
(3) At least one director is physically present at the meeting
location stated in the notice.
(4) A member attending the meeting at the location stated in the
notice can hear and be heard by all directors.
(5) Any vote taken at the meeting is by rollcall vote.
(b) For the purpose of establishing a quorum, a director who
participates in a meeting by teleconference pursuant to this section
is deemed to be present at the meeting.
(c) For the purposes of this section, "teleconference" means a
communication method that provides for two-way transmission of audio
or audio and visual signals.
4540. (a) The board may meet in executive session to consider
litigation, matters relating to the formation of contracts with third
parties, or personnel matters.
(b) Except as provided in subdivision (c), the board may consider
all of the following matters in executive session:
(1) An assessment dispute.
(2) A request for a payment plan.
(3) A decision to foreclose on a lien.
(4) A hearing pursuant to Section 5005.
(c) A member who is the subject of a matter described in
subdivision (b) may submit a written request to the board (Section
4035) that the matter be considered in an open meeting or in
executive session. The board shall comply with the member's request.
(d) Notwithstanding Section 4525, if the board meets in executive
session, a member who is the subject of the matter under
consideration may attend and speak during consideration of the
matter.
4545. (a) An action required or permitted to be taken by the
board may be taken without a meeting, if all directors individually
or collectively consent in writing to that action. The written
consent shall be filed with the minutes of the proceedings of the
board.
(b) For the purposes of this section "all directors" does not
include an "interested director" as defined in Section 5233 of the
Corporations Code, to the extent that section is made applicable
pursuant to Section 7238 of the Corporations Code.
4550. (a) Board meeting minutes, minutes proposed for adoption
that are marked to indicate draft status, or a summary of the
minutes, shall be available to members within 30 days of a board
meeting.
(b) The minutes for any part of a board meeting held in executive
session shall include a general description of the matter considered
in executive session.
(c) A member may request a copy of meeting minutes under Article 5
(commencing with Section 4700). Notwithstanding Section 4705, a
request for a copy of meeting minutes is not required to include a
statement of the purpose for the request.
(d) The member handbook (Section 4810) shall inform the members of
their right to obtain copies of board meeting minutes and shall
describe the procedure for obtaining a copy of the minutes.
4555. (a) A member may bring a civil action for declaratory or
equitable relief for a violation of this article by the member's
association, including injunctive relief, restitution, or a
combination thereof, within one year of the date the cause of action
accrues.
(b) The court may impose a civil penalty of up to five hundred
dollars ($500) for each violation, except that each identical
violation shall be subject to only one penalty if the violation
affects each member of the association equally.
(c) A member who prevails in a civil action to enforce a
requirement of this article is entitled to reasonable attorney's fees
and court costs. A prevailing association shall not recover any
costs, unless the court finds the action to be frivolous,
unreasonable, or without foundation.
4560. (a) This article applies to a board meeting or a meeting of
a committee that exercises a power of the board.
(b) If two or more associations have consolidated any of their
functions under a joint neighborhood association or similar
organization, the meetings of the joint organization are governed by
this article.
Article 3. Member Meeting
4575. (a) An association shall hold a regular member meeting to
transact business that requires action by the members, with the
frequency stated in the governing documents.
(b) An association may hold a special member meeting, pursuant to
Section 4600.
(c) A member meeting shall be held within the common interest
development unless the board determines that a larger meeting room is
required than is available within the common interest development. A
member meeting held outside of the common interest development shall
be held as close to the common interest development as is
practicable.
(d) A member meeting shall be conducted in accordance with a
recognized system of parliamentary procedure or any parliamentary
procedure the association may adopt in its governing documents.
4580. (a) Unless the declaration, articles, or bylaws provide
otherwise, the quorum for a member meeting is one-third of the voting
power of the association, represented in person or by proxy.
(b) An amendment of the bylaws to increase the quorum for a member
meeting shall be adopted with the approval of a majority of a quorum
of the members (Section 4070).
4585. (a) Unless this part or the governing documents require a
greater number of votes, an action approved by a majority of a quorum
of the members (Section 4070) is the action of the members.
(b) Unless the governing documents provide otherwise, a meeting at
which a quorum is initially present may continue to transact
business notwithstanding the withdrawal of members, if any action
taken is approved by affirmative votes equaling at least a majority
of the number of votes required for a quorum or, if a higher
percentage of the vote is required by law or the governing documents,
by that higher percentage.
(c) If a quorum has not been established at a member meeting, the
meeting may be adjourned by affirmative votes equaling at least a
majority of the votes cast, but no other business may be transacted.
4590. (a) If all of the following conditions are satisfied, the
board may elect to permit a member who is not physically present at
the noticed location of a member meeting to participate in the
meeting by teleconference:
(1) Each member participating in the meeting can communicate with
all other members concurrently.
(2) Each member participating in the meeting is provided the means
of participating in all matters being considered, including the
ability to propose or interpose an objection to a specific action.
(3) At least one member is physically present at the meeting
location stated in the notice.
(4) The vote of any member who is not present shall be cast
orally. A vote cast pursuant to this paragraph is not governed by
Section 4640.
(b) For the purposes of establishing a quorum, a member
participating in a meeting by teleconference pursuant to this section
is deemed to be present at the meeting.
(c) For the purposes of this section, "teleconference" means a
communication method that provides for two-way transmission of audio
or audio and visual signals.
4595. (a) The board shall deliver individual notice (Section
4040) of a regular meeting to each member who, on the date of the
notice, is entitled to vote at the meeting. The notice shall be
delivered at least 10 days, but not more than 90 days, before the
date of the meeting.
(b) The notice of a regular meeting shall include the date, time,
and place of the meeting. If the board makes arrangements for
participation in the meeting by teleconference, the notice shall
include instructions on how to participate by teleconference.
(c) The notice of a regular meeting shall state the matters that
the board, at the time of the notice, intends to present for action
by the members. The members may act on a matter that is not described
in the notice, except in the following circumstances:
(1) If the bylaws of the association provide for a quorum of
one-third or less of the voting power and less than one-third of the
voting power is present, the members shall not act on any matter that
was not described in the notice.
(2) The members shall not act on any matter that is not described
in the notice and that requires the approval of the members under
Section 7222, 7224, 7233, 7812, 8610, or 8719 of the Corporations
Code, unless the matter is required to be approved by the unanimous
vote of those entitled to vote on the matter, or the general nature
of the matter is described in each of the documents waiving notice
under Section 4610.
(d) The notice of any meeting at which a director will be elected
shall include the names of those who are nominees on the date of the
notice.
4600. (a) The following persons may call a special meeting of the
members at any time, for any lawful purpose, by adoption of a board
resolution or by delivery of a written request to the board (Section
4035) that states the business to be transacted at the special
meeting:
(1) The board.
(2) The president of the association or chair of the board.
(3) Any person authorized to do so by the governing documents.
(4) Members representing 5 percent or more of the voting power of
the association.
(b) Within 20 days after a special meeting is called, the board
shall deliver individual notice (Section 4040) of the special meeting
to each member who, on the date of the notice, is entitled to vote
at the special meeting. The notice shall include all of the following
information:
(1) The date and time of the special meeting, which shall be
between 35 to 90 days after the special meeting is called.
(2) The location of the special meeting.
(3) If arrangements are made for participation in the meeting by
teleconference, instructions on how to participate by teleconference.
(4) The general nature of the business to be transacted at the
special meeting. No other business may be transacted at the special
meeting.
(c) If the board does not send the required notice within 20 days
after the meeting is called, the person who called the special
meeting may set the time, date, and place of the special meeting and
send the notice. The association shall reimburse the person for the
cost of the notice.
4605. (a) Unless the governing documents provide otherwise, a
member meeting may be adjourned to another time or place without
giving written notice of the reconvened meeting, if both of the
following conditions are satisfied:
(1) The time, date, and place of the reconvened meeting are
announced at the meeting that is being adjourned. If arrangements are
made for participation in the reconvened meeting by teleconference,
the announcement shall include instructions on how to participate by
teleconference.
(2) The record date for notice and voting are not changed.
(b) The members may transact any business at a reconvened meeting
that could have been transacted at the adjourned meeting.
(c) No meeting may be adjourned for more than 45 days.
4610. (a) Notwithstanding the requirements of this article, a
court may find that a notice is valid if it was given in a fair and
reasonable manner.
(b) A failure to comply with the requirements of this article does
not make a transaction at a member meeting invalid if there is a
quorum at the meeting and if every member who is entitled to vote
satisfies one or more of the following conditions:
(1) The member is present at the meeting and does not raise, at
the beginning of the meeting, an objection to the meeting being held.
(2) The member gave a proxy to a person who is present at the
meeting and the proxyholder does not raise, at the beginning of the
meeting, an objection to the meeting being held.
(3) The member provides a waiver of notice, consent to hold the
meeting, or approval of the minutes of the meeting. The waiver,
consent, or approval shall be written and shall be filed with the
association's records and made part of the minutes of the meeting.
Unless expressly required by law or the governing documents, the
waiver, consent, or approval need not include a description of the
business to be transacted at the meeting.
(c) Notwithstanding subdivision (b), if a matter is required to be
described in the meeting notice and is not described in the meeting
notice, action on that matter is not valid if any member expressly
objects, at the meeting, that the matter may not be considered at the
meeting.
4615. (a) If an association is required to hold a member meeting
or conduct a written ballot and does not do so, a member or the
Attorney General may apply to the superior court for a summary order
compelling the association to hold the member meeting or conduct the
written ballot.
(b) The time for submitting an application under this section
shall be as follows:
(1) If a date is designated for holding a member meeting or
conducting a written ballot, the application shall be made 60 days or
more after the designated date.
(2) If a date is not designated for a member meeting, the
application shall be made 15 months or more after the formation of
the association or after the last regular member meeting.
(3) If a special meeting has been called pursuant to Section 4600,
and the board has not given the required notice, the application
shall be made 20 days or more after the special meeting is called.
(c) A copy of the application shall be served on the association,
which shall have an opportunity to be heard before the court issues
an order.
(d) The court may issue any appropriate order, including an order
that sets the time and place of a meeting and the record date for
determination of members entitled to vote, requires that notice of
the meeting be delivered, modifies or eliminates the quorum
requirement, or specifies the form or content of the notice.
4620. (a) A director, officer, or member may petition the
superior court for an order modifying any requirement of this part or
the governing documents that governs the conduct of a member meeting
or a written ballot. On filing the petition, the court shall set the
matter for hearing. The petitioner shall provide general notice of
the hearing, including a copy of the petition.
(b) If the court determines that it would be impractical or unduly
difficult for the association to conduct a member meeting or
otherwise obtain the consent of the members, the court may order that
a member meeting or written ballot be held and may, to the extent it
is fair and equitable to do so, modify or dispense with any
provision of this part or of the governing documents that relates to
the conduct of a member meeting or written ballot, including any
quorum requirement or provision requiring a specified number or
percentage of votes for member approval of a matter.
(c) An order issued pursuant to this section shall provide for a
method of notice that is reasonably designed to give actual notice to
all parties who are entitled to notice of the member meeting or
written ballot. Compliance with the method of notice ordered by the
court need not result in actual notice to all persons who are
entitled to notice.
(d) To the extent practical, an order issued pursuant to this
section shall limit the subject matter presented for member approval
to the following matters:
(1) An amendment of the governing documents that would or might
enable the association to manage its affairs without further resort
to this section.
(2) Dissolution, merger, sale of assets, or reorganization of the
association.
(3) A reasonable amendment of the declaration, if more than 50
percent of the voting power is required to amend the declaration.
(e) In a proceeding under this section, the court may determine
who is a member or director of the association.
(f) Member approval of a matter that is obtained in compliance
with the requirements of an order issued under this section is valid
and shall have the same force and effect as a member approval that
complies with all of the requirements of this part and the governing
documents.
Article 4. Member Election
4625. This article governs a member election. This article does
not govern a vote of directors or other appointed or elected
officials.
4630. The association shall adopt operating rules to address all
of the following matters:
(a) Any rule required to implement this article.
(b) Any qualification to serve in an elected position.
(c) The loss and restoration of a member's voting privilege.
(d) The calculation of voting power.
(e) If the governing documents permit the use of proxies,
procedures for the use of proxies.
(f) The selection of an election inspector.
4635. (a) An election shall be overseen by one or three election
inspectors, selected by the association for that purpose.
(b) An election inspector shall be an independent third party,
including, but not limited to, a volunteer poll worker with the
county registrar of voters, a licensee of the California Board of
Accountancy, or a notary public. Except as provided in subdivision
(c), a member of the association may serve as election inspector.
(c) The following persons may not be selected as election
inspectors:
(1) A director.
(2) A candidate for the office that is the subject of the
election.
(3) Unless the governing documents expressly provide otherwise, an
employee or contractor of the association.
(4) The parent, grandparent, child, grandchild, brother, sister,
spouse, domestic partner, uncle, aunt, niece, nephew, or first
cousin, whether by blood, marriage, domestic partnership, or
adoption, of any person who is disqualified under paragraphs (1) to
(3), inclusive.
(d) An election inspector shall, consistent with the governing
documents, do all of the following:
(1) Determine which members are entitled to vote and the voting
power of each.
(2) Determine the authenticity, validity, and effect of any
proxies.
(3) Receive ballots.
(4) Hear and decide all challenges and questions in any way
arising out of or in connection with the right to vote.
(5) Count and tabulate all votes.
(6) Determine when the polls open and close.
(7) Determine the results of the election.
(8) Perform any other task that may be required to conduct the
election with fairness to all members.
(e) An election inspector shall act impartially and in good faith,
to the best of the election inspector's ability, and as
expeditiously as is practical. If there are three election
inspectors, the action of a majority shall be deemed to be the action
of all. Any report made by the election inspector is prima facie
evidence of the facts stated in the report.
(f) An election inspector may appoint and oversee additional
persons to assist in verifying signatures and counting votes,
provided that the persons selected are independent third parties.
4640. (a) This section governs a member election on any of the
following matters:
(1) Assessment approval.
(2) Director election or removal.
(3) Amendment of the governing documents.
(4) The grant of exclusive use of common area.
(5) Any other matter that is expressly identified in the operating
rules as being governed by this section.
(b) The association shall deliver the following voting materials
to every member who is entitled to vote, by first-class mail or
personal delivery, at least 30 days prior to the deadline for voting:
(1) A ballot
that does not identify the member in any way. In the election of a
director, the ballot shall identify all nominated candidates. In an
election on a proposed action, the ballot shall describe the proposed
action and provide an opportunity to vote for or against the
proposed action.
(2) An inside envelope that does not identify the member in any
way.
(3) An outside envelope that is marked with the name of the
member, the address of each separate interest owned by the member,
and the address at which the ballot is to be cast.
(4) Instructions on how to cast the ballot. If cumulative voting
will be used to elect directors, the instructions shall explain how
to cast cumulative votes.
(c) A member shall cast a ballot in the following manner:
(1) Mark the ballot to indicate the member's vote and insert it,
unsigned, into the inside envelope.
(2) Seal the inside envelope and insert it into the outside
envelope.
(3) Seal and sign the outside envelope.
(4) Mail or hand deliver the outside envelope and its contents to
the election inspector at the address printed on the outside
envelope. If the outside envelope is delivered by hand, the member
may request a receipt for delivery.
(d) Once delivered, a secret ballot is irrevocable.
(e) Unless the governing documents provide otherwise, a member
election conducted pursuant to this section can be conducted entirely
by mail, with the exception of the meeting required by Section 4650.
For the purposes of determining the existence of a quorum, a ballot
received by the election inspector shall be treated in the same way
as a vote cast by a member present at a meeting.
(f) A member election that is not governed by this section may be
conducted as provided in Section 7513 of the Corporations Code.
4650. (a) A ballot cast pursuant to this article shall be counted
pursuant to this section.
(b) Prior to opening and counting a ballot, the election inspector
shall verify the information and signature on the outside envelope
and shall verify the eligibility to vote, voting power, and voting
class of the member who cast the ballot. A decision by the election
inspector to accept or reject a ballot is governed by Section 7517 of
the Corporations Code.
(c) The election inspector shall open and count all of the ballots
cast, at a board meeting or member meeting that is open to the
public. Any member may observe the counting of ballots, but shall not
be permitted to observe any information that would reveal the
identity of a member casting a ballot.
(d) The election inspector shall certify the results of the
election to the board, in writing. The results shall be noted in the
minutes of the meeting at which the ballots were counted and
delivered to all members by general notice (Section 4045) within 15
days after the votes are counted.
4655. (a) A ballot cast pursuant to this article shall remain in
the custody of the election inspector until it is opened and counted.
(b) Once the ballots are opened and counted, the election
inspector shall maintain custody of the ballots until the time for
challenge of the election result under Section 4685 has passed.
(c) The ballots shall be transferred to the association after the
time for challenge of the election result under Section 4685 has
passed.
(d) On the written request of a member, the election inspector
shall make the ballots available for inspection by the member or the
member's agent. Any inspection of ballots shall be conducted in a
manner that preserves the confidentiality of the vote.
(e) After the transfer of election materials to the association,
the ballots shall be stored by the association in a secure place for
no less than one year after the date of the election.
4660. (a) For the purposes of this article, "proxy" means a
written authorization signed by a member or the member's agent that
gives another member the power to vote on behalf of the member who
gave the proxy. For the purposes of this section, "signed" means the
placing of the member's name on the proxy (whether by manual
signature, typewriting, telegraphic transmission, or otherwise) by
the member or authorized representative of the member.
(b) A proxy is not itself a ballot and cannot be cast or counted
as a ballot.
(c) The governing documents may permit and regulate the use of
proxies.
(d) Nothing in this section requires that an association prepare
or distribute proxies.
(e) If a proxy includes instructions on how the proxyholder is to
cast the vote of the member who gave the proxy, the instruction shall
be stated on a separate page of the proxy that can be detached and
given to the proxyholder to retain.
(f) A proxy may be used in casting a secret ballot.
(g) A proxy is revocable until a ballot cast pursuant to the proxy
is received by the election inspector.
(h) A proxy is governed by Section 7514 and subdivisions (a)
through (f), inclusive, of Section 7613, of the Corporations Code.
(i) If a proxy is given for a vote on a matter other than the
election or removal of a director, the proxy shall state the nature
of the matter to be voted on. A proxy that does not comply with this
subdivision is invalid.
4665. (a) The governing documents of an association shall include
a reasonable procedure for the nomination of candidates in the
election of a director.
(b) The governing documents shall permit self-nomination.
(c) If the election is conducted at a member meeting, the
governing documents may permit nomination from the floor.
(d) The governing documents may permit write-in candidates.
(e) The governing documents shall provide a reasonable period for
the submission of nominations.
(f) The governing documents may authorize the board to declare
that all qualified nominees are elected without further action, if
after the close of nominations, the number of qualified nominees is
equal to or fewer than the number of directors to be elected.
4670. (a) An association may not use its funds to provide
campaign-related information, except as otherwise provided in this
section.
(b) An association may provide campaign-related information in a
newsletter, Internet Web site, or other media if it provides equal
access to all candidates or advocates for or against a proposal in
the pending election. The association shall not edit or redact
campaign-related information provided by a candidate or advocate
pursuant to this subdivision, but may include a statement specifying
that the candidate or advocate, and not the association, is
responsible for the information provided. An association is not
liable for campaign-related information provided by a candidate or
advocate pursuant to this subdivision.
(c) If an association has common area meeting space, it shall
provide access to the space, at no cost, for events that provide
campaign-related information. The association shall provide equal
access to each candidate and advocate for or against a proposal in
the pending election.
(d) For the purposes of this section, "campaign-related
information" means information that is reasonably related to a
pending election, including, but not limited to, the following
information:
(1) A statement advocating the election or defeat of a candidate
in a pending member election.
(2) A statement advocating the passage or defeat of a proposal at
issue in a pending member election.
(3) Information that includes the photograph or name of a
candidate within 30 days before ballots may be cast in an election.
(e) Nothing in this section limits the use of association funds to
include the name of a candidate in a ballot, ballot materials, or in
any other communication that is required by law.
4675. (a) Unless the governing documents provide otherwise, a
member who is entitled to vote may cast one vote for each separate
interest that the member owns.
(b) If a separate interest is owned by more than one person, each
owner shall be a member of the association, but there shall be no
more than one vote cast for that separate interest.
(c) The governing documents may provide, or the board may fix in
advance, the record date for determining the members entitled to vote
in a member election. The record date shall not be more than 60 days
before the first day on which a ballot may be cast in the member
election.
4680. Any action required or permitted to be taken by the members
may be taken without a meeting, if all members individually or
collectively consent in writing to the action. The written consent
shall be filed with the minutes of the proceedings of the members.
The action by written consent shall have the same force and effect as
the unanimous vote of the members. Action under this section is not
governed by Sections 4625 through 4675, inclusive.
4685. (a) A member of an association may bring a civil action for
a violation of this part or the governing documents in conducting a
member election.
(b) Upon the filing of the complaint, and before any further
proceedings are had, the court shall enter an order fixing a date for
the hearing, which shall be within five days unless good cause is
shown for a later date. The court shall require that the plaintiff
serve notice of the date of the hearing and a copy of the complaint
on the association and on any person, other than the plaintiff, whose
purported election or failure to be elected is challenged. Service
shall be in the manner in which a summons is required to be served,
or, if the court so directs, by registered mail. The court may make
any further requirements as to notice that appear to be proper under
the circumstances.
(c) If the court finds a violation, it may grant any equitable
relief that is appropriate, including nullification of the election
results, declaratory relief, injunction, and restitution. The court
may impose a civil penalty of up to five hundred dollars ($500) for
each violation, except that each identical violation shall be subject
to only one penalty if the violation affects each member of the
association equally.
(d) An action under this section shall be brought within one year
of the violation. In the absence of fraud, an election is
conclusively presumed to be valid if no action is brought under this
section within one year.
(e) A member who prevails in an action under this section is
entitled to reasonable attorney's fees and court costs.
(f) If the court finds that an action brought under this section
is frivolous, unreasonable, or without foundation, it may award
reasonable attorney's fees and court costs to the association.
(g) An action under this section that alleges a violation of this
part may be brought in the small claims division of the superior
court, so long as the amount of any demand for restitution does not
exceed the jurisdiction of that division.
Article 5. Inspection of Records
4700. (a) Except as otherwise provided in this article, a member
may inspect the following association records:
(1) The governing documents.
(2) The membership list, including member names, property
addresses, mailing addresses, and electronic mail addresses.
(3) The agenda and minutes of a member meeting, a board meeting,
or a meeting of a committee that exercises a power of the board.
(4) A report prepared pursuant to Article 7 (commencing with
Section 4800).
(5) A balance sheet, income and expense statement, budget
comparison, or general ledger. This paragraph applies to any record
of the types described, regardless of whether the record is interim
or final, audited or unaudited, prepared pursuant to a fixed schedule
or on an ad hoc basis. For the purposes of this paragraph, a
"general ledger" is a report that shows all transactions that
occurred in an association account over a specified period of time.
The records described in this paragraph shall be prepared in
accordance with an accrual or modified accrual basis of accounting.
(6) An invoice, receipt, cancelled check, credit card statement,
statement for services rendered, or reimbursement request.
(7) A statement of deposits to and withdrawals from the reserve
account, or showing the current balance of the reserve account.
(8) An executed contract.
(9) Written board approval of a vendor or contractor proposal or
invoice.
(10) A state or federal tax return.
(11) A record of the compensation provided to an employee or
contractor. The compensation information shall be indicated by job
classification or title and may not refer to an individual employee
or contractor by name or by other identifying information. Except as
provided in this subdivision, personnel records are not subject to
inspection.
(12) Information required by the member to comply with Section
5825.
(b) Notwithstanding subdivision (a), a member may not inspect the
following association records:
(1) A record that was prepared three or more fiscal years before
the fiscal year in which the inspection request is delivered. This
paragraph does not apply to the governing documents or the minutes of
a member meeting, a board meeting, or a meeting of a committee that
exercises a power of the board. The governing documents and meeting
minutes must be made available for inspection permanently.
(2) A record that is protected from disclosure by an evidentiary
privilege. Examples include documents subject to the attorney-client
privilege or relating to litigation in which the association is or
may become involved. For the purposes of this section, a contract to
provide maintenance, management, or legal services to an association
is not privileged.
(3) The agenda or minutes of a board or committee meeting held in
executive session.
(4) A record of a disciplinary action, collection activity, or a
payment plan for overdue assessments, that involves a person other
than the person making the request.
(5) An interior architectural plan of a separate interest.
(6) A plan showing any security features of a separate interest.
(7) A record of a good or service provided to a member for a fee.
(c) Inspection under this article may be made in person or by an
agent or attorney and the right of inspection includes the right to
copy and make extracts.
4705. (a) A member may deliver to the board (Section 4035) a
written request to inspect association records. The request shall
identify the records to be inspected and shall state a purpose for
the inspection that is reasonably related to the member's interest as
a member. The request may designate an agent to inspect the records
on the member's behalf.
(b) Except as provided in Sections 4710, 4715, and 4725, the
association shall make the requested records available for inspection
according to the following deadlines:
(1) For a record prepared in the current fiscal year, within 15
days after the request is delivered.
(2) For a record prepared in a prior fiscal year, within 30 days
after the request is delivered.
(3) For a record that has not yet been prepared, within 15 days
after the request is delivered or the record is prepared, whichever
is later.
(4) For the membership list, within 10 days.
(c) If the association has a business office in the common
interest development, the requested records shall be made available
for inspection in that office. If the association does not have a
business office in the common interest development, the records shall
be made available for inspection at a location agreed to by the
association and the member who submitted the request.
(d) At the member's request, copies of specifically identified
records shall be delivered to the member by individual delivery
(Section 4040). If a record exist in electronic form, the association
shall comply with a member request that the record be provided in
electronic form. Notwithstanding the other provisions of this
subdivision, the association shall not provide a record in electronic
form if the form of the record prevents a necessary redaction or
allows the record to be altered by the requesting member.
4710. (a) Before making a record available for inspection, the
association shall redact all of the following information from the
record:
(1) Any financial account number.
(2) Any password or personal identification number.
(3) Any social security number or taxpayer identification number.
(4) Any driver's license number.
(5) Any other information, if it is reasonably probable that
disclosure of the information will compromise the privacy of a
member, lead to unauthorized use of a person's identity or financial
resources, or is reasonably likely to lead to fraud in connection
with the association.
(b) Before providing a membership list, the association shall
remove the name and other information of any person who has opted to
have that information removed from the membership list pursuant to
Section 4715.
(c) If the member requests, the association shall provide a
written statement explaining the legal justification for any
redaction made.
4715. (a) A member may elect, in writing, to have the member's
name and other information removed from the membership list that is
available for inspection by the members.
(b) A member who requests the membership list may also request
that the association deliver material to any member whose information
has been removed from the membership list. The association shall
deliver the material to those members by individual delivery (Section
4040), within 15 days after delivery of the request.
4720. (a) The association may charge a fee to recover the direct
and actual cost to copy or deliver a record. The association shall
inform the member of the fee amount, and the member shall agree to
pay the fee, before a copy is made or a record delivered.
(b) The association may charge a fee of up to ten dollars ($10)
per hour, not to exceed two hundred dollars ($200) per written
request, for the time actually and reasonably spent to retrieve and
redact a record. The association shall inform the member of the
estimated fee amount, and the member shall agree to pay the fee,
before the record is retrieved and redacted.
4725. (a) A member may only inspect and use an association record
for a purpose that is reasonably related to the requesting member's
interest as a member. A member may not inspect or use an association
record for a commercial purpose.
(b) The association may deny a record inspection request if it
believes, in good faith and with a substantial basis, that the record
will be used for an impermissible purpose or that disclosure of the
record would violate a member's constitutional rights.
(c) Impermissible use of an association record includes, without
limitation, the use of a record without association permission for
any of the following purposes:
(1) To solicit money or property unless such money or property
will be used solely to solicit the vote of the members in an election
to be held by the association.
(2) Any purpose that the member does not reasonably and in good
faith believe will benefit the association.
(3) Any commercial purpose.
(4) The sale of the record to any person.
4730. (a) An association that denies a request for records under
this article shall provide the requesting member a notice of denial,
by individual delivery (Section 4040), within 15 days after delivery
of the inspection request.
(b) The notice of denial shall include all of the following
information:
(1) An explanation of the basis for the denial decision.
(2) An offer to attempt to resolve the matter through the
association's internal dispute resolution procedure provided pursuant
to Article 2 (commencing with Section 5050) of Chapter 4. The offer
may include an alternative proposal for achieving the member's
purpose, such as an offer to mail notices to the members on behalf of
the requesting member.
4735. (a) If an association has not complied with a document
inspection request within the time provided, the requesting member
may bring an action in the superior court to enforce the record
inspection request. The action may be filed in the small claims
division of the superior court if the amount of the demand does not
exceed the jurisdiction of that division.
(b) If the court determines that there is no legal basis for the
failure to comply with the record inspection request, it shall order
compliance.
(c) If the court determines that disclosure is not required under
this article, that disclosure would violate a member's constitutional
rights, or that there is a reasonable probability that disclosure
would lead to misuse of a record, it shall modify or set aside the
record inspection request.
(d) The court may grant any other relief appropriate to the
circumstances, including the following relief:
(1) If the association acted unreasonably in denying the request,
the imposition of a civil penalty of up to five hundred dollars
($500) against the association.
(2) The tolling of any deadline affected by association delay in
providing access to a record.
(3) The postponement of a scheduled board meeting or member
meeting, if association delay in providing access to a record would
prejudice the requesting member's interest in a decision to be made
at the meeting.
(4) The appointment of an investigator or accountant to inspect or
audit association records on behalf of the requesting member. The
cost of investigation shall ordinarily be borne by the requesting
member, but the court may order that the association bear or share
the cost.
(5) An order requiring that the association distribute material to
the membership on behalf of the requesting member, in lieu of
disclosing the membership list.
(e) The association bears the burden of proving the legal grounds
for noncompliance with the records request.
(f) If the court finds that the association acted unreasonably in
denying the record inspection request, it shall award reasonable
costs and expenses, including reasonable attorney's fees, to the
requesting member.
(g) If the court finds that an action brought under this section
is frivolous, unreasonable, or without foundation, it may award
reasonable costs and expenses, including reasonable attorney's fees,
to the association.
(h) Nothing in this section limits the right of the association to
bring an action under Section 4740.
4740. An association may bring an action for injunctive relief
and actual damages against any person who misuses association
records. In addition, a court in its discretion may award exemplary
damages for a fraudulent or malicious misuse of association records.
If the association prevails in an action brought under this section,
the court shall award the association reasonable costs and expenses,
including reasonable attorney's fees.
4745. An association, or an officer, director, employee, agent,
or volunteer of an association, is not liable for damages that result
from a failure to withhold or redact information pursuant to this
article, unless the failure to withhold or redact the information was
intentional, willful, or negligent.
4750. (a) This article applies to a community service
organization or similar entity that is related to the association.
The members of the community service organization or similar entity
shall have the same right to inspect records of that organization or
entity that are granted to the members of an association under this
article.
(b) This article does not apply to a common interest development
in which separate interests are being offered for sale by a
subdivider under the authority of a public report issued by the
Department of Real Estate, so long as the subdivider or all
subdividers offering those separate interests for sale, or any
employees of those subdividers or any other person who receives
direct or indirect compensation from any of those subdividers,
comprise a majority of the members of the board of directors of the
association. Notwithstanding the foregoing, this article applies to a
common interest development no later than 10 years after the close
of escrow for the first sale of a separate interest to a member of
the general public pursuant to the public report issued for the first
phase of the development.
(c) If two or more associations have consolidated any of their
functions under a joint neighborhood association or similar
organization, the members of each participating association shall
have access to the records of the joint organization as if they were
the records of the participating association.
(d) Notwithstanding Section 4025, a common interest development
that is exempt from the requirements of this article pursuant to this
section is governed by Article 3 (commencing with Section 8330) of
Chapter 13 of Part 3 of Division 2 of the Corporations Code.
Article 6. Recordkeeping
4775. (a) An association shall maintain at least one copy of the
following association records, for the periods specified in Section
4780:
(1) The original governing documents and any amendment of or
addition to the governing documents.
(2) The membership list, including the name, address, and
membership class of each member.
(3) The notice, agenda, and minutes of a member meeting, board
meeting, or meeting of a committee that exercises a power of the
board.
(4) A written waiver, consent, or approval received under Section
4610.
(5) A report prepared pursuant to Article 7 (commencing with
Section 4800).
(6) Books and records of account.
(7) A tax return or other tax-related record.
(8) A deed or other record that relates to title of real property
within the common interest development.
(9) A record that relates to the design, construction, or physical
condition of the common interest development.
(10) A record that relates to a proposed modification of a member'
s separate interest.
(11) A record that relates to litigation involving the association
or legal services provided to the association.
(12) An employment or payroll record.
(13) An insurance policy or record relating to insurance coverage
or claims.
(14) A contract to which the association is a party.
(15) A loan document.
(16) A ballot, proxy, or other record that relates to an election.
(17) A reserve funding study.
(18) A record that relates to enforcement of a restriction.
(b) The association may keep a record in paper form or in any
other form that can be converted to a paper copy, provided that the
paper copy accurately portrays the content of the record. A paper
copy produced from a nonpaper record is admissible in evidence and is
accepted for all other
purposes, to the same extent as an original paper record of the same
information.
4780. (a) Unless a longer period is required by law or by the
governing documents, an association shall retain a record listed in
Section 4775 for at least four years after its date of creation,
except that a record with continuing legal or operational effect
shall be retained during the period of its effect and for at least
four years after the termination of its effect.
(b) The association shall retain the following records
permanently:
(1) The original governing documents and each amendment of or
addition to the governing documents.
(2) The minutes of a member meeting, board meeting, or meeting of
a committee that exercises a power of the board.
(3) A deed or other record that relates to title of real property
within the common interest development.
(4) A record that relates to the design, construction, or physical
condition of the common interest development.
(c) A ballot cast in a member election shall be retained for the
period provided in Section 4655.
(d) This section does not apply to a record that is discarded or
destroyed before January 1, 2010.
4785. A director shall have the absolute right at any reasonable
time to inspect and copy all association books, records, and
documents of every kind and, subject to reasonable limitations in the
governing documents, to inspect the common area. These rights shall
be exercised pursuant to the standard provided in Section 7231 of the
Corporations Code.
Article 7. Annual Reports
4800. (a) Between 30 and 90 days before the end of the fiscal
year, the board shall prepare an annual budget report.
(b) The annual budget report shall include all of the following
information:
(1) The estimated revenue and expenses for the operating and
reserve accounts, on an accrual basis.
(2) The reserve funding study prepared pursuant to Section 5555.
(3) A summary of the association's property, general liability,
earthquake, flood, and fidelity insurance policies. For each policy,
the summary shall include the name of the insurer, the type of
insurance, the policy limit, and the amount of any deductible. To the
extent that any of the required information is specified in the
insurance policy declaration page, the association may meet its
obligation to disclose that information by making copies of that page
and distributing it with the annual budget report.
(c) The board shall promptly deliver a copy of the current annual
budget report to any member who requests a copy, at no cost to the
member.
(d) The type used in the annual budget report shall be at least 12
points in size.
4805. (a) Within 120 days after the end of the fiscal year, the
board of an association that receives ten thousand dollars ($10,000)
or more in gross revenues or receipts during the fiscal year shall
prepare an annual financial statement.
(b) If the association receives more than seventy-five thousand
dollars ($75,000) in a fiscal year, a licensee of the California
Board of Accountancy shall conduct a review of the annual financial
statement, using generally accepted accounting principles.
(c) The annual financial statement shall include all of the
following information:
(1) A balance sheet as of the end of that fiscal year and an
income statement and a statement of cashflows for that fiscal year.
(2) If the financial statement is reviewed by an independent
accountant, a copy of the accountant's report.
(3) If the financial statement is not reviewed by an independent
accountant, the certificate of an authorized officer of the
association that the financial statement was prepared without audit
from the books and records of the association.
(4) If the association is incorporated, a statement of any
transaction or indemnification of a type described in Section 8322 of
the Corporations Code.
(d) The board shall promptly deliver a copy of the current annual
financial statement to any member who requests a copy, at no cost to
the member.
(e) The type used in the annual financial statement shall be at
least 12 points in size.
4810. (a) Within 120 days after the end of the fiscal year, the
board shall prepare a member handbook that contains all of the
following information:
(1) A statement explaining that a member may submit a request to
have notices sent to up to two different specified addresses.
(2) The name and address of the person designated to receive
official communications to the board, pursuant to Section 4035.
(3) Notice of a member's right to receive copies of meeting
minutes, pursuant to subdivision (d) of Section 4550.
(4) The statement required by Section 5670.
(5) A statement describing the association's policies and
practices in enforcing lien rights or other legal remedies for
default in the payment of assessments.
(6) A statement describing the association's discipline policy,
including any schedule of penalties for violations of the governing
documents.
(7) A summary of alternative dispute resolution procedures,
pursuant to Sections 5070 and 5115.
(8) A summary of any requirements for association approval of a
physical change to property, pursuant to subdivision (c) of Section
5775.
(9) The location, if any, designated for posting of a general
notice (Section 4045).
(10) Any other information that is required by law or the
governing documents or that the board determines to be appropriate
for inclusion.
(b) The board shall promptly deliver a copy of the current member
handbook to any new member and to any member who requests a copy, at
no cost to the member.
(c) The type used in the member handbook shall be at least 12
points in size.
4815. (a) Unless the governing documents impose more stringent
standards, a community service organization that receives 10 percent
or more of its funding from an association or its members shall
prepare and distribute to the board an annual report that includes
all of the following information:
(1) A financial statement.
(2) A detailed statement of administrative costs that identifies
the person paid for each cost.
(3) If the report is not consistent with the requirements of
Article 5 (commencing with Section 4700), a statement describing the
noncompliance in detail.
(4) If a community service organization is responsible for the
maintenance of major components for which an association would
otherwise be responsible, information regarding those components that
the association requires to complete the disclosures and reserve
reports required under Article 3 (commencing with Section 5550) of
Chapter 5.
(b) An association may rely upon information received from a
community service organization.
4820. (a) When a report is prepared pursuant to Section 4800,
4805, 4810, or 4815, the board shall deliver individual notice
(Section 4040) to all members of the availability of the report.
(b) The notice required by this section shall be given when the
association adopts a reserve funding plan pursuant to Section 5560.
(c) The notice of availability shall include a general description
of the content of the report and instructions on how to request, at
no cost, a complete copy of the report.
(d) A board may deliver, by individual notice (Section 4040) to
all members, a complete copy of a report instead of the notice of
availability of the report.
4825. A financial statement required by this article shall be
prepared in conformity with generally accepted accounting principles
or some other basis of accounting that reasonably sets forth the
assets and liabilities and the income and expenses of the association
or community service organization and discloses the accounting basis
used in its preparation.
4830. (a) Any member may bring an action in superior court to
enforce the requirements of this article. The court may, for good
cause shown, extend the time for compliance with the requirements of
this article.
(b) In any action or proceeding under this section, if the court
finds the failure of the association to comply with the requirements
of this article to be without justification, the court may award the
member reasonable expenses, including attorney's fees, in connection
with the action or proceeding.
Article 8. Conflict of Interest
4855. (a) Notwithstanding any other law, and regardless of
whether an association is incorporated or unincorporated, the
provisions of Section 310 of the Corporations Code shall apply to any
contract or other transaction authorized, approved, or ratified by
the board or a committee of the board.
(b) A director or member of a committee shall not vote or
otherwise act on behalf of the association with respect to any of the
following matters:
(1) Discipline of the director or member.
(2) An assessment against the director or member for damage to the
common area or facilities.
(3) A request, by the director or member, for a payment plan for
overdue assessments.
(4) A decision whether to foreclose on a lien on the separate
interest of the director or member.
(5) Review of a proposed physical change to the separate interest
of the director or member.
(6) A grant of exclusive use common area to the director or
member.
(c) Nothing in this section limits any other provision of law or
the governing documents that governs a decision in which a director
may have an interest.
Article 9. Managing Agent
4900. (a) A prospective managing agent of a common interest
development shall provide a written disclosure to the board before
entering into a management agreement. The disclosure shall be
provided as soon as is practicable after entering into negotiations,
but in no event more than 90 days before entering into an agreement.
(b) The disclosure required under this section shall contain all
of the following information:
(1) The name and business address of each owner or general partner
of the managing agent. If the managing agent is a corporation, the
disclosure shall include the name and business address of each
shareholder owning more than 10 percent of the shares of the
corporation and each director or officer of the corporation.
(2) For each person named in paragraph (1), a list of any relevant
license or professional certification or designation held by that
person. A license, certification, or designation is relevant if it
relates to a service to be provided by the managing agent, including
architectural design, construction, engineering, real estate,
accounting, real property management, or community association
management. The list shall indicate the type of license,
certification, or designation, the issuing authority, the issuance
date, and any expiration date.
4905. (a) A managing agent who receives funds belonging to an
association, other than for deposit into an escrow account or account
under the control of the association, shall deposit the funds into a
trust fund account.
(b) The trust fund account shall be maintained in California, in a
federally insured financial institution. The account shall be
maintained in the name of the managing agent as trustee for the
association or in the name of the association.
(c) On the written request of the board, the trust fund account
shall be created as an interest bearing account. No interest earned
on funds in the account shall inure directly or indirectly to the
benefit of the managing agent or to an employee of the managing
agent.
(d) The managing agent shall inform the board of the nature of the
trust fund account, including a statement of how any interest will
be calculated and paid, whether service charges will be paid to the
depository and by whom, and whether there are any notice requirements
or penalties for withdrawal of funds from the account.
(e) Funds in a trust fund account may only be disbursed in
accordance with written instructions from the association that is
entitled to the funds.
(f) The managing agent shall maintain a separate record of the
receipt and disposition of all funds described in this section,
including any interest earned on the funds.
(g) The managing agent shall not commingle the funds of an
association with the funds of any other person, except as provided in
subdivision (h).
(h) A managing agent who commingled the funds of two or more
associations on or before February 26, 1990, may continue to do so if
all of the following requirements are met:
(1) The board of each affected association has given its written
assent to the commingling.
(2) The managing agent maintains a fidelity and surety bond in an
amount that is adequate to protect each association and that provides
each association at least 10 days' notice before cancellation. The
managing agent shall provide each affected board with the name and
address of the bonding company, the amount of the bond, and the
expiration date of the bond. If there are any changes in the bond
coverage or the company that provides the coverage, the managing
agent shall disclose that fact to the board of each affected
association as soon as practical, but in no event more than 10 days
after the change.
(3) The managing agent provides a written statement to each
affected board describing any benefit received by the managing agent
from the commingled account or the financial institution where the
funds will be on deposit.
(4) A completed payment on behalf of an association is deposited
within 24 hours or the next business day and does not remain
commingled for more than 10 calendar days. As used in this
subdivision, "completed payment" means funds received that clearly
identify the account to which the funds are to be credited.
(i) The prevailing party in an action to enforce this section
shall be entitled to recover reasonable legal fees and court costs.
(j) As used in this section, "financial institution" has the
meaning provided in Section 31041 of the Financial Code.
Article 10. Government Assistance
4950. To the extent existing funds are available, the Department
of Consumer Affairs and the Department of Real Estate shall develop
an online education course for the board of directors of an
association regarding the role, duties, laws, and responsibilities of
directors and prospective directors, and the nonjudicial foreclosure
process.
4955. (a) Upon receiving a complaint from a member, director, or
officer that an association has violated the provisions of Article 3
(commencing with Section 4575), Article 4 (commencing with Section
4625), Article 5 (commencing with Section 4700), Article 6
(commencing with Section 4775), or Article 7 (commencing with Section
4800), the Attorney General may, in the name of the people of the
State of California, send a notice of the complaint to the principal
office of the association (or, if there is no office, to the office
or residence of the chief executive officer or secretary, of the
corporation, as set forth in the most recent statement filed pursuant
to Section 8210 of the Corporations Code).
(b) If the answer to the notice of the complaint is not
satisfactory, or if there is no answer within 30 days, the Attorney
General may institute, maintain, or intervene in a suit, action, or
proceeding of any type in any court or tribunal of competent
jurisdiction or before any administrative agency for relief by way of
injunction, the dissolution of entities, the appointment of
receivers, or any other temporary, preliminary, provisional, or final
remedy as may be appropriate to protect the rights of members or to
undo the consequences of the violation. In any action, suit, or
proceeding under this section, all persons and entities responsible
for or affected by the violation may be joined as parties.
(c) If the violation involves assets held in charitable trust, the
Attorney General may bring an action under this section without
having received a complaint, and without first giving notice of a
complaint.
4960. (a) To assist with the identification of common interest
developments, each association shall submit to the Secretary of
State, on a form and for a fee not to exceed thirty dollars ($30)
that the Secretary of State shall prescribe, the following
information concerning the association and the development that it
manages:
(1) A statement that the association is formed to manage a common
interest development under the Davis-Stirling Common Interest
Development Act.
(2) The name of the association.
(3) The street address of the association's onsite office, or, if
none, of the responsible officer or managing agent of the
association.
(4) The name, address, and either the daytime telephone number or
e-mail address of the president of the association, other than the
address, telephone number, or e-mail address of the association's
onsite office or managing agent of the association.
(5) The name, street address, and daytime telephone number of the
association's managing agent, if any.
(6) The county, and if in an incorporated area, the city in which
the development is physically located. If the boundaries of the
development are physically located in more than one county, each of
the counties in which it is located.
(7) If the development is in an unincorporated area, the city
closest in proximity to the development.
(8) The nine-digit ZIP Code, front street, and nearest cross
street of the physical location of the development.
(9) The type of common interest development, as defined in
subdivision (c) of Section 4100.
(10) The number of separate interests in the development.
(b) The association shall submit the information required by this
section as follows:
(1) By incorporated associations, within 90 days after the filing
of its original articles of incorporation, and thereafter at the time
the association files its biennial statement of principal business
activity with the Secretary of State pursuant to Section 8210 of the
Corporations Code.
(2) By unincorporated associations, in July of 2003, and in that
same month biennially thereafter. Upon changing its status to that of
a corporation, the association shall comply with the filing
deadlines in paragraph (1).
(c) The association shall notify the Secretary of State of any
change in the street address of the association's onsite office or of
the responsible officer or managing agent of the association in the
form and for a fee prescribed by the Secretary of State, within 60
days of the change.
(d) The penalty for an incorporated association's noncompliance
with the initial or biennial filing requirements of this section
shall be suspension of the association's rights, privileges, and
powers as a corporation and monetary penalties, to the same extent
and in the same manner as suspension and monetary penalties imposed
pursuant to Section 8810 of the Corporations Code.
(e) The Secretary of State shall make the information submitted
pursuant to paragraph (4) of subdivision (a) available only for
governmental purposes and only to Members of the Legislature and the
Business, Transportation and Housing Agency, on written request. All
other information submitted pursuant to this section shall be subject
to public inspection pursuant to the California Public Records Act,
Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1
of the Government Code.
CHAPTER 4. DISPUTE RESOLUTION
Article 1. Disciplinary Action
5000. An association shall not fine a member for a violation of
the governing documents unless, at the time of the violation, the
governing documents expressly authorize the use of a fine and include
a schedule of the amounts that can be assessed for each type of
violation.
5005. (a) The board shall impose discipline on a member or assess
a member for damage to the common area and facilities only at a
meeting of the board at which the member shall have an opportunity to
be heard.
(b) At least 10 days before the meeting, the board shall deliver
an individual notice to the member (Section 4040) that includes all
of the following information:
(1) If the member is alleged to have violated the governing
documents, the provision of the governing documents that the member
is alleged to have violated, a brief summary of the facts
constituting the alleged violation, and the penalty that may be
imposed for the violation.
(2) If the member is alleged to be liable for damage to the common
area and facilities, a brief description of the facts giving rise to
the allegation and the amount to be assessed against the member for
the damage.
(3) The time, date, and location of the meeting at which the
matter will be heard.
(4) A statement that the member has a right to attend the meeting,
address the board, and request that the matter be considered in
closed executive session.
(c) Within 15 days after the meeting, the board shall deliver a
written decision to the member, by individual notice (Section 4040).
If the board imposes a penalty, the written decision shall state the
provision of the governing documents violated and the penalty for the
violation. If the board assesses the member for damage to the common
area and facilities, the written decision shall state the basis for
the member's liability and the amount assessed.
5015. For the purposes of this article, a member is responsible
for a violation of the governing documents by the member's guest,
invitee, or tenant, or a resident of the member's separate interest.
5020. The removal of a vehicle from a common interest development
by the association is governed by Section 22658 of the Vehicle Code.
Article 2. Internal Dispute Resolution
5050. (a) This article applies to a dispute between an
association and a member involving their rights, duties, or
liabilities under this part, under the Nonprofit Mutual Benefit
Corporation Law (Part 3 (commencing with Section 7110) of Division 2
of Title 1 of the Corporations Code), or under the governing
documents.
(b) This article supplements, and does not replace, Article 3
(commencing with Section 5075), relating to alternative dispute
resolution as a prerequisite to an enforcement action.
(c) This article does not apply to a decision made pursuant to
Section 5005 or 5620.
5055. (a) An association shall provide a fair, reasonable, and
expeditious procedure for resolving a dispute within the scope of
this article.
(b) In developing a procedure pursuant to this article, an
association shall make maximum, reasonable use of available local
dispute resolution programs involving a neutral third party,
including low-cost mediation programs such as those listed on the
Internet Web sites of the Department of Consumer Affairs and the
United States Department of Housing and Urban Development.
(c) If an association does not provide a fair, reasonable, and
expeditious procedure for resolving a dispute within the scope of
this article, the procedure provided in Section 5065 applies and
satisfies the requirement of subdivision (a).
5060. A fair, reasonable, and expeditious dispute resolution
procedure shall at a minimum satisfy all of the following
requirements:
(a) The procedure may be invoked by either party to the dispute. A
request invoking the procedure shall be in writing.
(b) The procedure shall provide for prompt deadlines. The
procedure shall state the maximum time for the association to act on
a request invoking the procedure.
(c) If the procedure is invoked by a member, the association shall
participate in the procedure.
(d) If the procedure is invoked by the association, the member may
elect not to participate in the procedure. If the member
participates but the dispute is resolved other than by agreement of
the member, the member shall have a right of appeal to the
association's board of directors.
(e) A resolution of a dispute pursuant to the procedure that is
not in conflict with the law or the governing documents binds the
association and is judicially enforceable. An agreement reached
pursuant to the procedure that is not in conflict with the law or the
governing documents binds the parties and is judicially enforceable.
(f) The procedure shall provide a means by which the member and
the association may explain their positions.
(g) A member of the association shall not be charged a fee to
participate in the process.
5065. (a) This section applies in an association that does not
otherwise provide a fair, reasonable, and expeditious dispute
resolution procedure. The procedure provided in this section is fair,
reasonable, and expeditious, within the meaning of this article.
(b) Either party to a dispute within the scope of this article may
invoke the following procedure:
(1) The party may request the other party to meet and confer in an
effort to resolve the dispute. The request shall be in writing.
(2) A member of an association may refuse a request to meet and
confer. The association may not refuse a request to meet and confer.
(3) The association's board of directors shall designate a member
of the board to meet and confer.
(4) The parties shall meet promptly at a mutually convenient time
and place, explain their positions to each other, and confer in good
faith in an effort to resolve the dispute.
(5) A resolution of the dispute agreed to by the parties shall be
memorialized in writing and signed by the parties, including the
board designee on behalf of the association.
(c) An agreement reached under this section binds the parties and
is judicially enforceable if both of the following conditions are
satisfied:
(1) The agreement is not in conflict with law or the governing
documents of the common interest development or association.
(2) The agreement is either consistent with the authority granted
by the board of directors to its designee or the agreement is
ratified by the board of directors.
(d) A member of the association may not be charged a fee to
participate in the process.
5070. The member handbook (Section 4810) shall include a
description of the internal dispute resolution process provided
pursuant to this article.
Article 3. Alternative Dispute Resolution: Prerequisite to
Civil Action
5075. As used in this article:
(a) "Alternative dispute resolution" means mediation, arbitration,
conciliation, or other nonjudicial procedure that involves a neutral
party in the dispute resolution process. The form of alternative
dispute resolution chosen pursuant to this article may be binding or
nonbinding, with the voluntary consent of the parties.
(b) "Enforcement action" means
a civil action or proceeding, other than a cross-complaint, for any
of the following purposes:
(1) Enforcement of this part.
(2) Enforcement of the Nonprofit Mutual Benefit Corporation Law
(Part 3 (commencing with Section 7110) of Division 2 of Title 1 of
the Corporations Code).
(3) Enforcement of the governing documents of a common interest
development.
5080. (a) An association or an owner or a member of a common
interest development may not file an enforcement action in the
superior court unless the parties have endeavored to submit their
dispute to alternative dispute resolution pursuant to this article.
(b) This section applies only to an enforcement action that is
solely for declaratory, injunctive, or writ relief, or for that
relief in conjunction with a claim for monetary damages not in excess
of the jurisdictional limits stated in Sections 116.220 and 116.221
of the Code of Civil Procedure.
(c) This section does not apply to a small claims action.
5085. (a) Any party to a dispute may initiate the process
required by Section 5080 by serving on all other parties to the
dispute a request for resolution. The request for resolution shall
include all of the following:
(1) A brief description of the dispute between the parties.
(2) A request for alternative dispute resolution.
(3) A notice that the party receiving the request for resolution
is required to respond within 30 days of service or the request will
be deemed rejected.
(4) If the party on whom the request is served is the owner of a
separate interest, a copy of this article.
(b) Service of the request for resolution shall be by personal
delivery, first-class mail, express mail, facsimile transmission, or
other means reasonably calculated to provide the party on whom the
request is served actual notice of the request.
(c) A party on whom a request for resolution is served has 30 days
following service to accept or reject the request. If a party does
not accept the request within that period, the request is deemed
rejected by the party.
5090. (a) A party on whom a request for resolution is served may
agree to participate in alternative dispute resolution by delivering
a written acceptance to the party that served the request for
resolution. The written acceptance shall be delivered as an
individual notice (Section 4040).
(b) The parties shall complete the alternative dispute resolution
within 90 days after delivery of the written acceptance, unless this
period is extended by written stipulation signed by both parties.
(c) Chapter 2 (commencing with Section 1115) of Division 9 of the
Evidence Code applies to any form of alternative dispute resolution
initiated by a Request for Resolution under this article, other than
arbitration.
(d) The costs of the alternative dispute resolution shall be borne
by the parties.
5095. If a request for resolution is served before the end of the
applicable time limitation for commencing an enforcement action, the
time limitation is tolled during the following periods:
(a) The period provided in Section 5085 for response to a request
for resolution.
(b) If the request for resolution is accepted, the period provided
by Section 5090 for completion of alternative dispute resolution,
including any extension of time stipulated to by the parties pursuant
to Section 5090.
5100. (a) At the time of commencement of an enforcement action,
the party commencing the action shall file with the initial pleading
a certificate stating that one or more of the following conditions is
satisfied:
(1) Alternative dispute resolution has been completed in
compliance with this article.
(2) One of the other parties to the dispute did not accept the
terms offered for alternative dispute resolution.
(3) Preliminary or temporary injunctive relief is necessary.
(b) Failure to file a certificate pursuant to subdivision (a) is
grounds for a demurrer or a motion to strike unless the court finds
that dismissal of the action for failure to comply with this article
would result in substantial prejudice to one of the parties.
5105. (a) After an enforcement action is commenced, on written
stipulation of the parties, the matter may be referred to alternative
dispute resolution. The referred action is stayed. During the stay,
the action is not subject to the rules implementing subdivision (c)
of Section 68603 of the Government Code.
(b) The costs of the alternative dispute resolution shall be borne
by the parties.
5110. In an enforcement action in which fees and costs may be
awarded, the court, in determining the amount of the award, may
consider whether a party's refusal to participate in alternative
dispute resolution before commencement of the action was reasonable.
5115. The member handbook (Section 4810) shall include a summary
of the provisions of this article that specifically references this
article. The summary shall include the following language: "Failure
of a member of the association to comply with the alternative dispute
resolution requirements of Civil Code Section 5080 may result in the
loss of your right to sue the association or another member of the
association regarding enforcement of the governing documents or the
applicable law."
Article 4. Civil Actions
5125. (a) The covenants and restrictions in the declaration shall
be enforceable equitable servitudes, unless unreasonable, and shall
inure to the benefit of and bind all owners of separate interests in
the development. Unless the declaration states otherwise, these
servitudes may be enforced by any owner of a separate interest or by
the association, or by both.
(b) A governing document other than the declaration may be
enforced by the association against an owner of a separate interest
or by an owner of a separate interest against the association.
(c) In an action to enforce the governing documents, the
prevailing party shall be awarded reasonable attorney's fees and
costs.
5130. In addition to any other remedy provided by law, a member
may bring an action in superior court to enforce a provision of this
part.
CHAPTER 5. FINANCES
Article 1. Accounting
5500. (a) The board shall maintain separate operating and reserve
accounts.
(b) The board shall maintain current income and expense records
for each account, on an accrual basis.
(c) If the reserve account includes funds received by the
association as a compensatory damage award or settlement in
litigation involving a construction or design defect, the deposit or
withdrawal of those funds shall be itemized separately.
(d) On at least a quarterly basis, the board shall reconcile the
income and expense record for each account against the most recent
statement provided by the financial institution for that account.
Article 2. Use of Reserve Funds
5510. (a) Funds on deposit in the reserve account may be used
only for the following purposes:
(1) The maintenance, repair, or replacement of a major component
that the association is required to maintain.
(2) Litigation that relates to the maintenance, repair, or
replacement of a major component that the association is required to
maintain.
(3) A temporary transfer of funds to the operating account
pursuant to Section 5515.
(b) The withdrawal of funds from the reserve account requires
either the signature of two directors or the signature of one
director and an officer who is not a director.
5515. (a) The board may authorize, at a board meeting, a
temporary transfer of funds from the reserve account to the operating
account in order to address a short term cash flow requirement or
other expense.
(b) Notice of the meeting at which the transfer is to be
authorized must include the following information:
(1) A statement that the board will consider a transfer of funds
from the reserve account to the operating account.
(2) The reason for the proposed transfer.
(3) Options for repayment of the transferred amount.
(4) Whether a special assessment may be necessary for repayment of
the transferred amount.
(c) If the board authorizes the transfer, the minutes of the
meeting shall include a written description of the amount to be
transferred, the reasons for the transfer, and when and how the
transferred amount will be repaid to the reserve account.
(d) Funds transferred under this section shall be repaid to the
reserve account within one year of the date of the initial transfer,
except that the board may delay repayment in the same manner that it
would authorize a new transfer. A board may only delay repayment if
it makes a written finding, supported by documentation, that the
delay would be in the best interest of the common interest
development.
(e) The board shall exercise prudent fiscal management in
maintaining the integrity of the reserve account, and shall, if
necessary, levy a special assessment to recover the full amount of
the transferred funds within the time limits required by this
section. This special assessment is subject to the limitation imposed
by Section 5580. The board may, in its discretion, extend the date
the payment on the special assessment is due. An extension of the due
date does not prevent the board from pursuing any legal remedy to
enforce the collection of an unpaid special assessment.
5520. (a) If funds in the reserve account are expended or
transferred for the purpose of litigation, the board shall provide
general notice to the members (Section 4045) of the expenditure or
transfer. The notice shall inform the members of their rights under
subdivision (b).
(b) The board shall make an accounting, at least quarterly, of any
funds in the reserve account that are expended or transferred for
the purpose of litigation. A member may inspect the accounting
pursuant to Article 5 (commencing with Section 4700) of Chapter 3.
Article 3. Reserve Funding
5550. At least once every three years, the board shall conduct a
reasonably competent and diligent visual inspection of the accessible
areas of the major components that the association is obligated to
maintain.
5555. (a) At least once every three years, the board shall
prepare a reserve funding study. The board shall review the study
annually and make any necessary adjustments to the study.
(b) The study shall describe each major component that the
association is obligated to maintain and that has a remaining useful
life of less than 30 years. The study shall provide at least the
following information for each included component, as of the end of
the fiscal year for which the study is prepared or updated:
(1) An identifying description of the component.
(2) The total useful life of the component, in years.
(3) The estimated repair and replacement cost of the component
over its useful life.
(4) The average annual repair and replacement cost for the
component. This is calculated by dividing the lifetime repair and
replacement cost by the total useful life of the component.
(5) The number of years the component has been in service.
(6) The required balance for the component. This is calculated by
one of the two following methods: (A) by multiplying the average
annual repair and replacement cost and the number of years that the
component has been in service, or (B) by a generally accepted
alternative method that is described in the study.
(c) The study shall include a summary page in the following form,
with the indicated attachments:
Summary of Reserve Funding Study
The information provided in this summary is
current as of the end of fiscal year ____.
(1) It is based on a reserve study prepared by
____ on ____. A copy of the complete study
is available from the association on
request, at no charge.
(2) Current Fiscal Year Projection: At the end
of this fiscal year, the balance in the
reserve account is projected to be
$____. This figure includes only assets held
in cash or cash equivalents and projected
income.
The total required balance for all
components included in the reserve funding
study is $____. A description of the method
used to calculate the required balance is
attached.
The balance of the reserve account is ____%
of the total required balance for all
components included in the reserve funding
study.
If the balance of the reserve account is
less than the total required balance for all
components included in the reserve funding
study, the difference is $____. The
difference per separate interest is
$____.
Note: If the units in this development do
not pay equal assessments, then the
proportional share of the difference, for
each class of unit, is attached.
(3) Five-Year Projection: The tables below
provide projections for each of the five
fiscal years following the current fiscal
year. Table 1 shows the projected
balance in the reserve account if the most
recently approved reserve funding plan is
implemented. Table 2 shows the projected
balance in the reserve account if the most
recently approved reserve funding plan is
not implemented.
Table 1. Five-Year Projection with
Implementation of Funding Plan
+---------+------------+-------------+--------------+
| | | Total | |
| | | Required | |
| | | Balance for | Ratio of |
| | | all | Projected |
| | | Components | Balance to |
| | | Included in | Required |
| Fiscal | Projected | the Reserve | Balance (as |
| Year | Balance |Funding Study| percentage) |
+---------+------------+-------------+--------------+
| | | | |
+---------+------------+-------------+--------------+
| | | | |
+---------+------------+-------------+--------------+
| | | | |
+---------+------------+-------------+--------------+
| | | | |
+---------+------------+-------------+--------------+
| | | | |
+---------+------------+-------------+--------------+
Table 2. Five-Year Projection without
Implementation of Funding Plan
+---------+------------+-------------+--------------+
| | | Total | |
| | | Required | |
| | | Balance for | Ratio of |
| | | all | Projected |
| | | Components | Balance to |
| | | Included in | Required |
| Fiscal | Projected | the Reserve | Balance (as |
| Year | Balance |Funding Study| percentage) |
+---------+------------+-------------+--------------+
| | | | |
+---------+------------+-------------+--------------+
| | | | |
+---------+------------+-------------+--------------+
| | | | |
+---------+------------+-------------+--------------+
| | | | |
+---------+------------+-------------+--------------+
| | | | |
+---------+------------+-------------+--------------+
(4) The current regular assessment per unit is
$____ per
____.
Note: If the units in this development do
not pay equal assessments, then a schedule
showing the current regular assessment for
each class of unit is attached.
(5) Additional regular assessments that have
already been approved for any purpose are
listed in the schedule below:
+------------------+-------------+------------------+
| Date assessment | Amount per | |
| | unit | Purpose of the |
| takes effect | | assessment |
| | per month | |
+------------------+-------------+------------------+
| | | |
+------------------+-------------+------------------+
| | | |
+------------------+-------------+------------------+
| |Total: | |
+------------------+-------------+------------------+
Note: If the units in this development do
not pay equal assessments, then a schedule
showing the approved regular assessments for
each class of unit is attached.
(6) Special assessments that have been approved
for any purpose are listed in the schedule
below:
+----------------+----------------+----------------+
| Date assessment| Amount of | Purpose of the |
| | | assessment |
| takes effect | the assessment | |
+----------------+----------------+----------------+
| | | |
+----------------+----------------+----------------+
| | | |
+----------------+----------------+----------------+
| |Total: | |
+----------------+----------------+----------------+
Note: If the units in this development do
not pay equal assessments, then a schedule
showing the approved special assessments for
each class of unit is attached.
(7) If the association has any outstanding loans
with an original term of more than one year,
information about those loans is included in
the schedule below:
+---------+---------+-----------+----------+----------+
| | Amount | | | Date when|
| | | Interest | Annual | loan to |
| Lender | owed | rate | payment |be retired|
+---------+---------+-----------+----------+----------+
| | | | | |
+---------+---------+-----------+----------+----------+
| | | | | |
+---------+---------+-----------+----------+----------+
| | | | | |
+---------+---------+-----------+----------+----------+
(8) Based on the most recent reserve study and
other information available to the board of
directors, will the current regular
assessment, approved increases in the
regular assessment, and approved special
assessments provide sufficient reserve
funds at the end of each year to meet the
association's obligation for repair and
replacement of major components over the
next 30 years?
Yes ____ No ____
(9) If the answer to question (8) is no, please
refer to the most recently approved reserve
funding plan for a description of any
additional assessment increases or special
assessments that may be proposed in order
to provide sufficient reserve funds at the
end of each year to meet the association's
obligation for repair and replacement of
major components over the next 30 years.
(10) The financial representations set forth in
this summary are based on the best
estimates of the preparer at that time. The
estimates are subject to change. A
statement describing the procedures used to
make the calculations used in this summary
is attached.
(d) The summary prepared pursuant to subdivision (c) shall be
included with the notice of availability of the annual budget report
that is delivered to members pursuant to Section 4820. The form may
be supplemented or modified in order to make the information provided
clearer or more complete, so long as the minimum information
required by subdivision (c) is provided.
(e) The summary prepared pursuant to subdivision (c) shall not be
admissible in evidence to show improper financial management of an
association. Other relevant and competent evidence of the financial
condition of the association is not made inadmissible by this
subdivision.
(f) A component with an estimated remaining useful life of more
than 30 years may be included in a study as a capital asset or
disregarded from the reserve calculation, so long as the decision is
revealed in the reserve study report and reported in the summary
prepared pursuant to subdivision (c).
5560. (a) At least once every three years, the board shall
prepare a reserve funding plan that describes how the association
will contribute sufficient funds to the reserve account to meet the
association's obligation to repair and replace the major components
included in the most recent reserve funding study.
(b) The plan may provide for an increase in the general
assessment, a special assessment, borrowing, use of other assets,
deferral of selected replacement or repairs, or other mechanisms.
(c) If the plan proposes an increase in the general assessment, it
shall describe the proposed increase in the following form:
+------------------+-------------+------------------+
| Date assessment | Amount per | |
| | unit | Purpose of the |
| takes effect | | assessment |
| | per month | |
+------------------+-------------+------------------+
| | | |
+------------------+-------------+------------------+
| | | |
+------------------+-------------+------------------+
| |Total: | |
+------------------+-------------+------------------+
(d) If the plan proposes an increase in one or more special
assessments, it shall describe the proposed increase in the following
form:
+----------------+----------------+----------------+
| Date assessment| Amount of | Purpose of the |
| | | assessment |
| takes effect | the assessment | |
+----------------+----------------+----------------+
| | | |
+----------------+----------------+----------------+
| | | |
+----------------+----------------+----------------+
| |Total: | |
+----------------+----------------+----------------+
(e) If the separate interests in the development do not pay equal
assessments, the plan shall indicate the amount of any increase or
special assessment for each class of separate interest.
(f) The plan shall be considered by the board at a board meeting.
(g) Board approval of the plan does not constitute approval of an
assessment increase described in the plan. Any assessment increase
must be considered separately by the board and is subject to the
procedure provided in Section 5580.
(h) The plan may not assume a rate of return on cash reserves in
excess of 2 percent above the discount rate published by the Federal
Reserve Bank of San Francisco at the time the plan is prepared.
(i) The reserve funding plan may be supplemented or modified in
order to make the information provided clearer or more complete, so
long as the minimum information required by this section is provided.
Article 4. Assessments
5575. (a) An association shall levy regular and special
assessments sufficient to perform its obligations under the governing
documents and this title.
(b) An association shall not levy an assessment or fee that
exceeds the amount necessary to defray the costs for which it is
levied.
5580. (a) Subject to the limitations of Section 5575 and
subdivision (b), the board may increase the regular assessment by any
amount that is required to fulfill its obligations and may impose a
special assessment of any amount that is required to fulfill its
obligations. This subdivision supersedes any contrary provision of
the governing documents.
(b) In the following circumstances, an assessment increase or
special assessment may be adopted only with the approval of an
affirmative majority of the votes cast in a member election at which
at least 50 percent of the voting power is represented:
(1) The association has not complied with Section 4800 for the
fiscal year in which the assessment increase or special assessment
would take effect.
(2) The total increase in the regular assessment for the fiscal
year would be more than 20 percent of the regular assessment for the
preceding fiscal year.
(3) The total for all special assessments imposed in the fiscal
year would be more than 5 percent of the budgeted gross expenses of
the association for the fiscal year in which the special assessment
would be imposed.
(c) Subdivision (b) does not apply to an assessment increase that
is required to address the following emergency expenses:
(1) An extraordinary expense required by an order of a court.
(2) An extraordinary expense necessary to repair or replace any
part of the development that the association is obligated to
maintain, where a threat to personal safety is discovered on the
property.
(3) An extraordinary expense necessary to repair or replace any
part of the development that the association is obligated to maintain
that could not have been reasonably foreseen by the board in
preparing and distributing the budget report under Section 4800.
Before imposing an assessment under this subdivision, the board shall
adopt a resolution containing written findings as to the necessity
of the extraordinary expense involved and why the expense was not or
could not have been reasonably foreseen in the budgeting process, and
the resolution shall be distributed to the members with the notice
of assessment.
(d) The association shall provide the members with individual
notice (Section 4040) of any increase in the regular or special
assessments of the association at least 30 days before the increased
assessment takes effect.
5585. (a) A regular assessment imposed or collected to perform an
obligation of an association under the governing documents or this
title is exempt from execution by a judgment creditor of the
association only to the extent necessary for the association to
perform essential services, such as paying for utilities and
insurance. In determining the appropriateness of an exemption, a
court shall ensure that only essential services are protected under
this subdivision.
(b) This section does not apply to a consensual
pledge, lien, or encumbrance that is approved by a majority of a
quorum of the members (Section 4070), or to any state tax lien, or to
any lien for labor or materials supplied to the common area.
Article 5. Payment and Collection of Assessment
5600. (a) The association shall provide a mailing address for
receipt of an assessment payment that is sent by overnight delivery.
The address shall be included in the member handbook (Section 4810).
(b) On the request of a member, the association shall provide that
member with a receipt for a payment made to the association. The
receipt shall indicate the date and amount of the payment and the
person who received the payment for the association.
(c) A payment made for a delinquent assessment shall first be
applied to the assessment owed. Only after the assessment owed is
paid in full shall the payment be applied to collection costs, a late
fee, or interest.
5605. (a) An assessment becomes delinquent 15 days after it is
due, unless the declaration provides a longer time period, in which
case the longer time period applies.
(b) If an assessment is delinquent, the association may recover
all of the following amounts:
(1) The unpaid amount of the assessment.
(2) The reasonable cost incurred in collecting the delinquent
assessment, including a reasonable attorney's fee.
(3) A late charge not exceeding 10 percent of the delinquent
assessment or ten dollars ($10), whichever is greater, unless the
declaration specifies a late charge in a smaller amount, in which
case the late charge shall not exceed the amount specified in the
declaration.
(4) Interest on the delinquent assessment, the reasonable cost of
collection, and the late charge. The annual interest rate shall not
exceed 12 percent, commencing 30 days after the assessment becomes
due, unless the declaration specifies a lower rate of interest, in
which case the lower rate of interest applies.
(c) An association is exempt from interest rate limitations
imposed by Article XV of the California Constitution, subject to the
limitations of this section.
(d) The amount described in subdivision (b) becomes a debt of the
member at the time the assessment or other sum is levied.
5610. (a) Except as otherwise provided in this section, an
association may not voluntarily assign or pledge to a third party the
association's right to collect a payment or assessment, or to
enforce or foreclose a lien.
(b) An association may assign or pledge the association's right to
collect a payment or assessment, or to enforce or foreclose a lien,
to a financial institution or lender chartered or licensed under
federal or state law, when acting within the scope of that charter or
license, as security for a loan obtained by the association.
(c) An association may assign an unpaid obligation of a former
member to a third party for purposes of collection.
5615. (a) At least 30 days before recording a lien on the
separate interest of the owner of record to collect a debt that is
past due under this article, the association shall deliver to the
owner of record, by certified mail, a written notice of delinquency.
(b) The notice of delinquency shall include the following
information:
(1) An itemized statement of the charges owed, including any
collection costs, late fee, and interest.
(2) A general description of the collection and lien enforcement
procedures of the association and the method by which the amount due
was calculated.
(c) The notice of delinquency shall include the following
statement, in bold 14-point type:
"IMPORTANT NOTICE
IF YOUR SEPARATE INTEREST IS PLACED IN FORECLOSURE BECAUSE YOU ARE
BEHIND IN YOUR ASSESSMENTS, IT MAY BE SOLD WITHOUT COURT ACTION.
However, before the association can initiate foreclosure, you have
the right to request alternative dispute resolution with a neutral
third party under Civil Code Section 5655(a)(2).
You have the right to inspect association records under Civil Code
Section 4700.
You have the right to request a meeting with a representative of
the board under Civil Code Section 5625.
If you wish to request a payment plan, you have the right to
request a meeting with the board under Civil Code Section 5620.
If the association determines that the assessment is not
delinquent, you will not be liable for any collection costs, late
fees, or interest."
5620. (a) A member that owes a delinquent assessment may deliver
a written request (Section 4035) to meet with the board to discuss a
payment plan for the debt. If the association has adopted standards
for payment plans, the association shall provide a copy of the
standards to the member.
(b) The association shall meet with the member and consider the
request within 45 days after receipt of the request, either at a
regularly scheduled board meeting or at a specially scheduled meeting
between the member and a committee appointed by the board for that
purpose. The board shall deliver individual notice (Section 4040) to
the member stating the date, time, and location of the meeting at
which the request will be considered.
(c) A payment plan may incorporate an assessment that will accrue
during the payment plan period. Additional late fees shall not accrue
during the payment plan period if the owner is in compliance with
the terms of the payment plan.
(d) A payment plan does not affect an association's ability to
record a lien on the owner's separate interest to secure payment of a
delinquent assessment. In the event of a default on any payment
plan, the association may resume its efforts to collect all
delinquent assessments.
5625. Before recording a lien for delinquent assessments, an
association shall offer the owner and, if so requested by the owner,
participate in internal dispute resolution pursuant to Article 2
(commencing with Section 5050) of Chapter 4.
5630. (a) An association that has complied with Sections 5615 and
5625 may record a notice of delinquent assessment in the county in
which the common interest development is located. Recording of the
notice of delinquent assessment creates a lien against the property
for which the delinquent assessment is owed.
(b) The recorded notice of delinquent assessment shall state the
following information:
(1) The amount owed, including an itemized statement of any
delinquent assessment amount, reasonable cost of collection, late
fees, or interest.
(2) A legal description of the separate interest against which the
lien is imposed.
(3) The name of the record owner of the separate interest against
which the lien is imposed.
(c) A lien may not be enforced by nonjudicial foreclosure unless
the recorded notice of delinquent assessment states the name and
address of the trustee that is authorized by the association to
enforce the lien by sale.
(d) The recorded notice of delinquent assessment shall be signed
by the person designated in the declaration or by the association for
that purpose, or if no one is designated, by the president of the
association.
(e) A copy of the recorded notice of delinquent assessment shall
be mailed by certified mail to every person whose name is shown as an
owner of the separate interest in the association's records, no
later than 10 days after recordation.
(f) Unless the governing documents provide otherwise, a lien
created pursuant to this section has priority over a subsequently
recorded lien.
(g) The decision to record a lien for a delinquent assessment
shall be made only by the board, at a meeting of the board, and may
not be delegated to an agent of the association.
(h) Nothing in this article or in subdivision (a) of Section 726
of the Code of Civil Procedure prohibits an action against the owner
of a separate interest to recover sums for which a lien is created
pursuant to this section or prohibits an association from taking a
deed in lieu of foreclosure.
(i) An association that fails to comply with Section 5615 or 5625
before recording a lien shall provide a new notice under Section
5615. Any additional costs that accrue from the failure to comply
with Section 5615 or 5625 shall be borne by the association and not
by the owner of the separate interest.
5635. (a) Within 21 days after the payment of the sums stated in
a recorded notice of delinquent assessment, the association shall
record a lien release or notice of rescission in the county in which
the notice of delinquent assessment is recorded. The association
shall deliver to the record owner of the separate interest, by
individual notice (Section 4040), a copy of the lien release or
notice of rescission.
(b) Within 21 days after a determination that a notice of
delinquent assessment was recorded in error, the association shall
record a lien release or notice of rescission in the county in which
the notice of delinquent assessment is recorded. The association
shall deliver to the record owner of the separate interest, by
individual notice (Section 4040), a copy of the lien release or
notice of rescission and a declaration that the notice of delinquent
assessment was recorded in error.
(c) If a notice of delinquent assessment is recorded in error, the
association shall reverse any collection cost, late fee, or interest
that results from the error. The association shall bear any cost of
alternative dispute resolution that relates to the error.
5640. (a) Unless the governing documents provide otherwise, a
monetary charge imposed by the association as a means of reimbursing
the association for costs incurred by the association in the repair
of damage to common areas and facilities for which the member, a
resident of the member's separate interest, or the member's guest,
invitee, or tenant is responsible may become a lien against the
member's separate interest that is enforceable by the sale of the
interest under Sections 2924, 2924b, and 2924c.
(b) A fine imposed by the association for a violation of the
governing documents, however described, shall not become a lien
against the member's separate interest that is enforceable by the
sale of the interest under Sections 2924, 2924b, and 2924c. This
subdivision does not apply to a penalty for late payment of a regular
or special assessment.
5645. (a) Except as otherwise provided in this article, 30 days
after recording a notice of delinquent assessment, an association may
enforce the resulting lien in any manner permitted by law, including
sale by the court, sale by the trustee designated in the recorded
notice of delinquent assessment, or sale by a trustee substituted
pursuant to Section 2934a.
(b) If the amount of the lien is within the jurisdictional limit
of the small claims division of the superior court, the association
may bring an action to collect the debt in the small claims division
pursuant to Chapter 5.5 (commencing with Section 116.110) of Title 1
of Part 1 of the Code of Civil Procedure. An association may enforce
a judgment of the small claims division as provided in Article 8
(commencing with Section 116.810) of Chapter 5.5 of Title 1 of Part 1
of the Code of Civil Procedure. The amount recovered in an action in
the small claims division, which may not exceed the jurisdictional
limit of the small claims division, is the sum of the following:
(1) The amount owed as of the date of filing the complaint.
(2) In the discretion of the court, an additional amount equal to
the amount owed for the period from the date the complaint is filed
until satisfaction of the judgment, which may include accruing unpaid
assessments and any reasonable late charges, fees and costs of
collection, attorney's fees, and interest.
5650. (a) An association may only foreclose on a lien, judicially
or nonjudicially, if the debt is 12 months or more overdue or the
amount owed, excluding any accelerated assessment, collection cost,
late charge, or interest, is one thousand eight hundred dollars
($1,800) or more.
(b) Subdivision (a) does not apply to a separate interest owned by
the declarant.
(c) This section applies to a lien recorded on or after January 1,
2006.
5655. (a) Before commencing foreclosure to enforce a lien created
under this article, the association shall satisfy all of the
following requirements:
(1) The decision to foreclose shall be made by the board at least
30 days before any public sale. The decision may not be delegated to
a committee or agent. The vote approving foreclosure shall be
recorded in the minutes. The board shall maintain the confidentiality
of the owner of the separate interest by identifying the matter in
the minutes by the parcel number of the property only.
(2) The association shall offer to participate in either internal
dispute resolution pursuant to Article 2 (commencing with Section
5050), or alternative dispute resolution pursuant to Article 3
(commencing with Section 5075), of Chapter 4. The decision of whether
to participate and the type of alternative dispute resolution to use
shall be made by the owner of the separate interest, except that
binding arbitration may not be used if the association intends to
commence a judicial foreclosure.
(3) The association shall serve notice of its decision to
foreclose on the owner or the owner's legal representative, in
accordance with the manner of service of summons in Article 3
(commencing with Section 415.10) of Chapter 4 of Title 5 of Part 2 of
the Code of Civil Procedure.
(b) Any sale by a trustee shall be conducted in accordance with
Sections 2924, 2924b, and 2924c. The fees of a trustee may not exceed
the amounts prescribed in Sections 2924c and 2924d, plus the cost of
service for either of the following documents:
(1) The notice of default recorded pursuant to subdivision (c).
(2) The decision of the board to foreclose on the separate
interest provided pursuant to paragraph (3) of subdivision (a).
(c) If the association records a notice of default pursuant to
Section 2924, the association shall serve a copy of the notice of
default on the owner or the owner's legal representative in the same
manner as service of a summons under Article 3 (commencing with
Section 415.10) of Chapter 4 of Title 5 of Part 2 of the Code of
Civil Procedure.
(d) If the owner of the separate interest does not occupy the
separate interest, a notice required under this section may be
delivered by first class mail to the mailing address shown in the
association's records. If the owner has not provided the association
with a mailing address, the address of the separate interest is
deemed to be the owner's mailing address.
(e) For the purposes of this section, the "owner's legal
representative" means a person designated by the owner as the owner's
legal representative in a notice delivered to the board (Section
4035).
5660. A separate interest sold by a trustee under this article is
subject to a right of redemption for 90 days after the sale. In
addition to the requirements of Section 2924f, notice of sale in
connection with an association's foreclosure of a separate interest
shall include a statement that the property is being sold subject to
the right of redemption created in this section.
5665. (a) In order to facilitate the collection of a regular
assessment, special assessment, transfer fee, or similar charge, the
board is authorized to record a statement or amended statement
identifying relevant information for the association. This statement
may include any or all of the following information:
(1) The name of the association as shown in the conditions,
covenants, and restrictions or the current name of the association,
if different.
(2) The name and address of a managing agent or treasurer of the
association or other individual or entity authorized to receive
payment for assessments and fees imposed by the association.
(3) A daytime telephone number of the person identified in
paragraph (2).
(4) A list of separate interests subject to assessment by the
association, showing the assessor's parcel number or legal
description, or both, of the separate interests.
(5) The recording information identifying the declaration or
declarations of covenants, conditions, and restrictions governing the
association.
(6) If an amended statement is being recorded, the recording
information identifying the prior statement or statements that the
amendment is superseding.
(b) The county recorder is authorized to charge a fee for
recording the document described in subdivision (a), based on the
number of pages in the document and the recorder's per-page recording
fee.
5670. The member handbook (Section 4810) shall include the
following statement:
NOTICE REGARDING ASSESSMENTS AND FORECLOSURE
This notice outlines some of the rights and responsibilities of
owners of property in common interest developments and the
associations that manage them. Please refer to the sections of the
Civil Code indicated for further information. A portion of the
information in this notice applies only to liens recorded on or after
January 1, 2003. You may wish to consult a lawyer if you dispute an
assessment.
ASSESSMENTS AND FORECLOSURE
An assessment becomes delinquent 15 days after it is due, unless
the governing documents provide for a longer time. The failure to pay
an association assessment may result in the loss of an owner's
property through foreclosure. Foreclosure may occur either as a
result of a court action, known as judicial foreclosure, or without
court action, often referred to as nonjudicial foreclosure.
An association may not use judicial or nonjudicial foreclosure to
enforce a lien that is recorded on or after January 1, 2006, if the
debt is less than 12 months overdue and the amount of the delinquent
assessments or dues, exclusive of any accelerated assessment, late
charge, fee, attorney's fee, interest, or cost of collection, is less
than one thousand eight hundred dollars ($1,800).
An association may use judicial or nonjudicial foreclosure to
collect a debt if it is more than 12 months overdue or if the amount
owed for assessments or dues is more than one thousand eight hundred
dollars ($1,800). Foreclosure is subject to the conditions set forth
in Civil Code Sections 5650 and 5655.
When using judicial or nonjudicial foreclosure, the association
records a lien on the owner's property. The owner's property may be
sold to satisfy the lien if the amounts secured by the lien are not
paid. (Civil Code Sections 5645, 5650, and 5655.)
In a judicial or nonjudicial foreclosure, the association may
recover the delinquent assessment, the reasonable cost of collection
including a reasonable attorney's fee, a late charge, and interest.
The association may not use nonjudicial foreclosure to collect a fine
or penalty. Unless the governing documents provide otherwise, an
association may use nonjudicial foreclosure to collect the cost to
repair damage to the common area that is caused by a member or the
member's guests. (Civil Code Section 5640.)
The association must comply with the requirements of Civil Code
Sections 5615, 5620, and 5625 when collecting a delinquent
assessment. If the association fails to follow these requirements, it
may not record a lien on the owner's property until it has satisfied
the requirements. Any additional cost that results from satisfying
the requirements is the responsibility of the association. (Civil
Code Section 5630.)
At least 30 days before recording a lien on an owner's separate
interest, the association must provide the owner of record with
certain documents by certified mail, including a description of its
collection and lien enforcement procedure and the method used to
calculate the amount owed. It must also provide an itemized statement
of the charges owed by the owner. An owner has a right to review the
association's records to verify the debt. (Civil Code Section 5615.)
If a lien is recorded against an owner's property in error, the
person who recorded the lien is required to record a lien release
within 21 days, and to provide an owner certain documents in this
regard. (Civil Code Section 5635.)
The collection practices of the association may be governed by
state and federal laws regarding fair debt collection. Penalties can
be imposed for debt collection practices that violate these laws.
PAYMENTS
On the request of a member, the association shall provide that
member with a receipt for a payment made to the association. The
receipt shall indicate the date and amount of the payment and the
person who received the payment for the association. The association
must inform owners of a mailing address for the overnight delivery of
payments. (Civil Code Section 5600.)
An owner may dispute an assessment debt by submitting a written
request for dispute resolution to the association under Civil Code
Section 5625. In addition, an association may not initiate a
foreclosure without participating in alternative dispute resolution
with a neutral third party under Civil Code Section 5655, if so
requested by the owner. Binding arbitration shall not be available if
the association intends to initiate a judicial foreclosure.
An owner is not liable for a late charge, interest, or the cost of
collection, if it is established that the assessment was paid
properly on time. (Civil Code Section 5635.)
MEETINGS AND PAYMENT PLANS
An owner of a separate interest may request the association to
consider a payment plan to satisfy a delinquent assessment. The
association must inform the owner of the standards for payment plans,
if any exist. (Civil Code Section 5620)
The board of directors must meet with an owner who makes a proper
written request for a meeting to discuss a payment plan when the
owner has received a notice of a delinquent assessment. A payment
plan must conform with the payment plan standards of the association,
if they exist. (Civil Code Section 5620)
5675. (a) Except as otherwise provided, this article applies to a
lien created on or after January 1, 2003.
(b) A lien created before January 1, 2003, is governed by the law
in existence at the time the lien was created.
Article 6. Insurance and Liability
5680. (a) An association officer or director is not personally
liable for a tortious act or omission of the officer or director, in
excess of the amount of insurance coverage specified in paragraph
(6), if all of the following requirements are met:
(1) The officer or director is a volunteer.
(2) The officer or director is a tenant of a separate interest or
an owner of no more than two separate interests.
(3) The association is exclusively residential.
(4) The act or omission was performed within the scope of the
officer's or director's association duties.
(5) The act or omission was performed in good faith.
(6) The act or omission was not willful, wanton, or grossly
negligent.
(7) The association maintained and had in effect, at the time of
the act or omission and at the time that a claim is made, insurance
coverage for the general liability of the association and for the
individual liability of an officer or director of the association for
negligent acts or omissions in that capacity. In an association with
100 or fewer separate interests, the coverage for each type of
liability shall be at least five hundred thousand dollars ($500,000).
In an association of more than 100 separate interests, the coverage
for each type of liability shall be at least one million dollars
($1,000,000).
(b) For the purposes of this section, "volunteer" does not include
the declarant or a person who receives direct or indirect
compensation as an employee of the declarant, or as an employee of a
financial institution that purchased a separate interest at a
judicial or nonjudicial foreclosure of a mortgage or deed of trust on
real property. Payment of actual expenses incurred by a director or
officer in the execution of the duties of that position does not
affect the director's or officer's status as a volunteer.
(c) Nothing in this section limits the liability of the
association for its negligent act or omission or for any negligent
act or omission of an officer or director of the association.
(d) For the purposes of this section, an officer's or director's
association duties include making a decision on whether to conduct an
investigation of the common interest development for latent
deficiencies before the expiration of the applicable statute of
limitations and whether to commence a civil action against the
builder for defects in design or construction. This subdivision is
intended to clarify the application of this section. It is not
intended to expand or limit the fiduciary duties owed by a director
or officer.
5685. (a) It is the intent of the Legislature to offer civil
liability protection to owners of separate interests in a common
interest development that has common area that is owned as
tenancy-in-common if the association carries a certain level of
prescribed insurance that covers a cause of action in tort.
(b) A cause of action in tort against a member arising solely by
reason of an ownership interest as a tenant in common in the common
area shall be brought only against the association and not against
the individual members, if both of the insurance requirements are
met:
(1) The association maintained and has in effect for this cause of
action, one or more policies of insurance which include coverage for
general liability of the association.
(2) The coverage described in paragraph (1) is in the following
minimum amounts:
(A) At least two million dollars ($2,000,000) if the common
interest development consists of 100 or fewer separate interests.
(B) At least three million dollars ($3,000,000) if the common
interest development consists of more than 100 separate interests.
5690. (a) If an insurance policy described in the annual budget
report pursuant to Section 4800 lapses or is canceled, and is not
immediately renewed, restored, or replaced, or if there is a
significant change to the policy, such as a reduction in coverage or
limits or an increase in the deductible, the association shall give
individual notice (Section 4040) of the change to the members as soon
as reasonably practicable.
(b) If the association receives notice of nonrenewal of a policy
described in the annual budget report pursuant to Section 4800 and a
replacement policy will not be in effect by the date that the
existing policy will lapse, the association shall immediately give
individual notice (Section 4040) of that fact to the members.
CHAPTER 6. PROPERTY MAINTENANCE AND USE
Article 1. Maintenance
5700. Unless the declaration provides otherwise, the
responsibility for repair, replacement, and maintenance is as
follows:
(a) The association is responsible for the repair, replacement,
and maintenance of the common area, other than exclusive use common
area.
(b) The owner of a separate interest is responsible for the
maintenance of the separate interest and any exclusive use common
area appurtenant to the separate interest.
(c) Upon approval of the majority of all members (Section 4065),
responsibility for the repair and maintenance of the separate
interests occasioned by the presence of wood-destroying pests or
organisms may be delegated to the association, which may recover its
costs through a special assessment.
5705. (a) The association may cause the temporary, summary
removal of any occupant of a common interest development as may be
necessary for prompt, effective treatment of wood-destroying pests or
organisms.
(b) The association shall give individual notice (Section 4040) of
the need to temporarily vacate a separate interest to the occupant
and, if the owner is different from the occupant, to the owner.
Notice shall be given not less than 15 days nor more than 30 days
prior to the date of the temporary relocation. The notice shall state
the reason for the temporary relocation, the date and time of the
beginning of treatment, the anticipated date and time of termination
of treatment, and that the occupants will be responsible for their
own accommodations during the temporary relocation.
(c) For purposes of this section, "occupant" means an owner,
resident, guest, invitee, tenant, lessee, sublessee, or other person
in possession of the separate interest.
(d) The costs of temporary relocation of an occupant pursuant to
this section shall be borne by the owner of the separate interest
affected.
5710. Notwithstanding the governing documents, the owner of a
separate interest is entitled to reasonable access to the common
areas for the purpose of maintaining the internal and external
communication wiring that is exclusive use common area pursuant to
Section 4145. The access shall be subject to the consent of the
association, whose approval shall not be unreasonably withheld, and
which may include the association's approval of communication wiring
upon the exterior of the common area, and other conditions as the
association determines reasonable. For the purposes of this section,
"wiring" includes nonmetallic transmission lines.
Article 2. Limitation of Association Authority to Regulate
Property Use
5725. This article includes provisions that limit the authority
of an association to regulate the use of a member's separate
interest. Nothing in this article is intended to affect the
application of any other provision that limits the authority of an
association to regulate the use of a member's separate interest,
including, but not limited to, the following provisions:
(a) Sections 712 and 713, relating to the display of signs.
(b) Sections 714 and 714.1, relating to solar energy systems.
(c) Section 714.5, relating to structures that are constructed
offsite and moved to the property in sections or modules.
(d) Sections 782, 782.5, and 6150 of this code and Section 12956.1
of the Government Code, relating to racial restrictions.
(e) Section 12927 of the Government Code, relating to the
modification of property to accommodate a disability.
(f) Section 1597.40 of the Health and Safety Code, relating to the
operation of a family day care home.
5730. (a) Except as otherwise provided in this section, the
governing documents of an association may not prohibit the display of
the flag of the United States or any other noncommercial sign,
poster, flag, or banner within a member's separate interest or
exclusive use common area.
(b) Notwithstanding Section 434.4 of the Government Code, an
association may prohibit the display of the flag of the United States
or any other noncommercial sign, poster, flag, or banner within a
member's separate interest or exclusive use common area if any of the
following conditions is satisfied:
(1) The display endangers public health or safety.
(2) The display violates a local, state, or federal statute or
regulation.
(3) The display includes the painting of architectural surfaces,
or includes lights, roofing, siding, paving materials, plants, or
balloons, or any other building, landscaping, or architectural
materials.
(4) The display is not a flag and is more than 9 square feet in
size.
(c) An association may prohibit the display of a flag other than
the flag of the United States, if the flag is more than 15 square
feet in size.
(d) In an action under this section to challenge a prohibition on
the display of the flag of the United States, the prevailing party
shall be awarded reasonable attorney's fees and costs.
5735. (a) No governing documents shall prohibit the owner of a
separate interest within a common interest development from keeping
at least one pet within the common interest development, subject to
reasonable rules and regulations of the association. This section may
not be construed to affect any other rights provided by law to an
owner of a separate interest to keep a pet within the development.
(b) For purposes of this section, "pet" means any domesticated
bird, cat, dog, aquatic animal kept within an aquarium, or other
animal as agreed to between the association and the homeowner.
(c) If the association implements a rule or regulation restricting
the number of pets an owner may keep, the new rule or regulation
shall not apply to prohibit an owner from continuing to keep any pet
that the owner currently keeps in his or her separate interest if the
pet otherwise conforms with the previous rules or regulations
relating to pets.
(d) For the purposes of this section, "governing documents" shall
include, but are not limited to, the conditions, covenants, and
restrictions of the common interest development, and the bylaws,
rules, and regulations of the association.
(e) This section shall become operative on January 1, 2001, and
shall only apply to governing documents entered into, amended, or
otherwise modified on or after that date.
5740. (a) An association may not require that a homeowner install
or repair a roof in a manner that is in violation of Section 13132.7
of the Health and Safety Code.
(b) The governing documents of a common interest development
located within a very high fire severity zone, as designated by the
Director of Forestry and Fire Protection pursuant to Article 9
(commencing with Section 4201) of Chapter 1 of Part 2 of Division 4
of the Public Resources Code or by a local agency pursuant to Chapter
6.8 (commencing with Section 51175) of Part 1 of Division 1 of Title
5 of the Government Code, shall allow for at least one type of fire
retardant roof covering material that meets the requirements of
Section 13132.7 of the Health and Safety Code.
5745. (a) Except as otherwise provided in this section, a
provision of the governing documents is void to the extent that it
would prohibit or restrict the use or installation of an antenna.
(b) The following restrictions on the use or installation of an
antenna are not void pursuant to this section:
(1) A restriction or prohibition that is consistent with a
provision of law that imposes the same restriction or prohibition.
(2) A requirement that the antenna not be visible from a street or
from the common area.
(3) A restriction that does not significantly increase the cost of
the antenna, including all related equipment, or significantly
decrease its efficiency or performance.
(4) A requirement that the association approve the installation
before installation takes place.
(5) A requirement that the association approve the installation of
an antenna on the separate interest of a member other than the
member seeking to install the antenna.
(6) A provision for the maintenance, repair, or replacement of
roofs or other building components.
(7) A requirement that the installer indemnify or reimburse the
association or a member for loss or damage caused by the
installation, maintenance, or use of the antenna.
(c) Whenever approval is required for the installation or use of
an antenna, the application for approval shall be processed by the
appropriate approving entity for the common interest development in
the same manner as an application for approval of an architectural
modification to the property, and the issuance of a decision on the
application shall not be willfully delayed.
(d) In any action to enforce compliance with this section, the
prevailing party shall be awarded reasonable attorney's fees.
(e) For the purposes of this section "antenna" means a video or
television antenna, including a satellite dish, of less than 36
inches in diameter or diagonal measurement.
5750. (a) A provision of the governing documents that arbitrarily
or unreasonably restricts a member's ability to market the member's
interest in a common interest development is void.
(b) An association shall not charge a fee in connection with the
marketing of a member's interest that exceeds the actual cost to the
association that results from the marketing of the member's interest.
(c) An association shall not require that a member use a
particular real estate broker to market the member's interest.
(d) For the purposes of this section, "market" and "marketing"
mean listing, advertising, or obtaining or providing access to show
the member's interest.
5755. The architectural guidelines of a common interest
development shall not prohibit or include conditions that have the
effect of prohibiting the use of low-water-using plants as a group.
5760. (a) Any change in the exterior appearance of a separate
interest shall be in accordance with the governing documents and
applicable law.
(b) Subject to the governing documents and applicable law, the
owner of a separate interest may make any improvement or alteration
within the boundaries of the separate interest that does not impair
the structural integrity or mechanical systems or lessen the support
of any part of the common interest development.
(c) Subject to the governing documents and applicable law, the
owner of a separate interest may modify the separate interest, at the
owner's expense, to facilitate access for a person who is blind,
visually handicapped, deaf, or physically disabled, or to alter
conditions that could be hazardous to the disabled person. This may
include a modification of the route from the public way to the door
of the separate interest if the separate interest is on the ground
floor or is already accessible by an existing ramp or elevator.
(d) A modification made pursuant to subdivision (c) is subject to
the following conditions:
(1) The modification shall be consistent with applicable building
code requirements.
(2) The modification shall be consistent with the intent of
otherwise applicable provisions of the governing documents pertaining
to safety or aesthetics.
(3) A modification of the common area shall not prevent reasonable
passage by other residents, and shall be removed by the owner when
the unit is no longer occupied by a disabled person who requires the
modification.
(4) The owner shall submit plans and specifications for a proposed
modification to the association for review to determine whether the
proposed modification complies with this section. The association
shall not deny approval of the proposed modification without good
cause.
Article 3. Architectural Review
5775. (a) This section applies if an association's governing
documents require association approval before an owner of a separate
interest may make a physical change to the owner's separate interest
or to the common area. In reviewing and approving or disapproving a
proposed change, the association shall satisfy the following
requirements:
(1) The association shall provide a fair, reasonable, and
expeditious procedure for making its decision. The procedure shall be
included in the association's governing documents. The procedure
shall provide for prompt deadlines. The procedure shall state the
maximum time for response to an application or a request for
reconsideration by the board of directors.
(2) A decision on a proposed change shall be made in good faith
and may not be unreasonable, arbitrary, or capricious.
(3) Notwithstanding a contrary provision of the governing
documents, a decision on a proposed change may not violate any
governing provision of law, including, but not limited to, the Fair
Employment and Housing Act (Part 2.8 (commencing with Section 12900)
of Division 3 of Title 2 of the Government Code), or a building code
or other applicable law governing land use or public safety.
(4) A decision on a proposed change shall be in writing. If a
proposed change is disapproved, the written decision shall include
both an explanation of why the proposed change is disapproved and a
description of the procedure for reconsideration of the decision by
the board of directors.
(5) If a proposed change is disapproved, the applicant is entitled
to reconsideration by the board of directors of the association that
made the decision, at an open meeting of the board. This paragraph
does not require reconsideration of a decision that is made by the
board of directors or a body that has the same membership as the
board of directors, at a meeting that satisfies the requirements of
Article 2 (commencing with Section 4500) of Chapter 3.
Reconsideration by the board does not constitute dispute resolution
within the meaning of Section 5055.
(b) Nothing in this section authorizes a physical change to the
common area in a manner that is inconsistent with an association's
governing documents, unless the change is required by law.
(c) An association shall annually provide its members with notice
of any requirements for association approval of physical changes to
property. The notice shall describe the types of changes that require
association approval and shall include a copy of the procedure used
to review and approve or disapprove a proposed change.
CHAPTER 7. PROPERTY OWNERSHIP AND TRANSFER
Article 1. Ownership Rights and Interests
5800. Unless the declaration provides otherwise, in a condominium
project, or in a planned development in which the common area is
owned by the owners of the separate interests, the common area is
owned by the owners of the separate interests as tenants in common,
with one share for each separate interest.
5805. Unless the declaration provides otherwise:
(a) In a community apartment project, condominium, or a planned
development in which the common area is owned in common by the owners
of the separate interests, there are appurtenant to each separate
interest nonexclusive rights of ingress, egress, and support, if
necessary, through the common areas. The common area is subject to
these rights.
(b) In a stock cooperative, and in a planned development in which
the common area is owned by the association, there is an easement for
ingress, egress, and support, if necessary, appurtenant to each
separate interest. The common areas are subject to these easements.
5810. Except as otherwise provided by law, an order of the court,
or an order pursuant to a final and binding arbitration decision, an
association may not deny a member or other occupant of a separate
interest physical access to the separate interest, either by
restricting access through the common area, or by restricting access
solely to the separate interest.
Article 2. Transfer Disclosure
5825. As soon as practicable before the transfer of title to a
separate interest or the execution of a real property sales contract
for a separate interest, as defined in Section 2985, the owner of the
separate interest, other than an owner subject to the requirements
of Section 11018.6 of the Business and Professions Code, shall
provide the following documents to the prospective purchaser:
(a) A copy of the governing documents of the common interest
development, including any operating rules, and including a copy of
the association's articles of incorporation, or, if not incorporated,
a statement in writing from an authorized representative of the
association that the association is not incorporated.
(b) If there is a restriction in the governing documents limiting
the occupancy, residency, or use of a separate interest on the basis
of age in a manner different from that provided in Section 51.3, a
statement that the restriction is only enforceable to the extent
permitted by Section 51.3 and a statement specifying the applicable
provisions of Section 51.3.
(c) A copy of the most recent documents distributed pursuant to
Article 7 (commencing with Section 4800) of Chapter 3.
(d) A true statement in writing obtained from an authorized
representative of the association as to the amount of the association'
s current regular and special assessments and fees, any assessments
levied upon the owner's interest in the common interest development
that are unpaid on the date of the statement, and any monetary fines
or penalties levied upon the owner's interest and unpaid on the date
of the statement. The statement obtained from an authorized
representative shall also include true information on late charges,
interest, and costs of collection which, as of the date of the
statement, are or may be made a lien upon the owner's interest in a
common interest development pursuant to Article 5 (commencing with
Section 5600) of Chapter 5.
(e) A copy or a summary of any notice previously sent to the owner
pursuant to Section 5005 that sets forth any alleged violation of
the governing documents that remains unresolved at the time of the
request. The notice shall not be deemed a waiver of the association's
right to enforce the governing documents against the owner or the
prospective purchaser of the separate interest with respect to any
violation. This paragraph shall not be construed to require an
association to inspect an owner's separate interest.
(f) A copy of the preliminary list of defects provided to each
member of the association pursuant to Section 6200, unless the
association and the builder subsequently enter into a settlement
agreement or otherwise resolve the matter and the association
complies with Section 6210. Disclosure of the preliminary list of
defects pursuant to this paragraph does not waive any privilege
attached to the document. The preliminary list of defects shall also
include a statement that a final determination as to whether the list
of defects is accurate and complete has not been made.
(g) A copy of the latest information provided for in Section 6210.
(h) Any change in the association's current regular and special
assessments and fees that have been approved by the association's
board of directors, but have not become due and payable as of the
date disclosure is provided pursuant to this subdivision.
5830. (a) A member may request, in writing, that the association
provide the member with the documents described in Section 5825.
(b) Within 15 days after the request is delivered to the board
(Section 4035), the association shall provide the requesting member
with a copy of the requested documents.
(c) If the requested documents are maintained in electronic form,
the requesting member shall have the option of receiving them by
electronic transmission or on machine readable storage media.
(d) The association may charge a reasonable fee to recover the
actual cost to procure, prepare, and reproduce the requested
documents.
5835. In addition to the requirements of this article, an owner
transferring title to a separate interest shall comply with
applicable requirements of Sections 1133 and 1134.
5840. Any person or entity who willfully violates this article is
liable to the purchaser of a separate interest that is subject to
this section for actual damages caused by the violation and, in
addition, shall pay a civil penalty in an amount not to exceed five
hundred dollars ($500). In an action to enforce this liability, the
prevailing party shall be awarded reasonable attorneys' fees.
5845. Nothing in this article affects the validity of title to
real property transferred in violation of this section.
Article 3. Transfer Fee
5875. Except as provided in Section 5880, an association or
community service organization or similar entity may not impose or
collect any assessment, penalty, or fee in connection with a transfer
of title or any other interest except for the following:
(a) An amount not to exceed the association's actual costs to
change its records.
(b) A fee under Section 5830.
5880. Section 5875 does not apply to a community service
organization or similar entity of either of the following types:
(a) An entity that satisfies both of the following conditions:
(1) It was established before February 20, 2003.
(2) It exists and operates, in whole or in part, to fund or
perform environmental mitigation or to restore or maintain wetlands
or native habitat, as required by the state or local government as an
express written condition of development.
(b) An entity that satisfies all of the following conditions:
(1) It is not an entity described by subdivision (a).
(2) It was established and received a transfer fee before January
1, 2004.
(3) On and after January 1, 2006, it offers a purchaser the
following payment options for the fee or charge it collects at time
of transfer:
(A) Paying the fee or charge at the time of transfer.
(B) Paying the fee or charge pursuant to an installment payment
plan for a period of not less than seven years. If the purchaser
elects to pay the fee or charge in installment payments, the
community service organization or similar entity may also collect
additional amounts that do not exceed the actual costs for billing
and financing on the amount owed. If the purchaser sells the separate
interest before the end of the installment payment plan period, the
purchaser shall pay the remaining balance before the transfer.
Article 4. Restrictions on Transfers
5900. (a) Unless the governing documents specify a different
percentage, the affirmative vote of members owning at least 67
percent of the separate interests in the common interest development
shall be required before the board of directors may grant exclusive
use of any portion of the common area to a member.
(b) Subdivision (a) does not apply to the following actions:
(1) A reconveyance of all or any portion of the common area to the
subdivider to enable the continuation of development that is in
substantial conformance with a detailed plan of phased development
submitted to the Real Estate Commissioner with the application for a
public report.
(2) A grant of exclusive use that is in substantial conformance
with a detailed plan of phased development submitted to the Real
Estate Commissioner with the application for a public report or in
accordance with the governing documents approved by the Real Estate
Commissioner.
(3) A grant of exclusive use to eliminate or correct engineering
errors in documents recorded with the county recorder or on file with
a public agency or utility company.
(4) A grant of exclusive use to eliminate or correct encroachments
due to errors in construction of any improvements.
(5) A grant of exclusive use to permit changes in the plan of
development submitted to the Real Estate Commissioner in
circumstances where the changes are the result of topography,
obstruction, hardship, aesthetic considerations, or environmental
conditions.
(6) A grant of exclusive use to fulfill the requirement of a
public agency.
(7) A grant of exclusive use to transfer the burden of management
and maintenance of any common area that is generally inaccessible and
not of general use to the membership at large of the association.
(8) A grant in connection with an expressly zoned industrial or
commercial development, or any grant within a subdivision of the type
defined in Section 4020.
(c) Any measure placed before the members requesting that the
board of directors grant exclusive use of any portion of the common
area shall specify whether the association will receive any monetary
consideration for the grant and whether the association or the
transferee will be responsible for providing any insurance coverage
for exclusive use of the common area.
5905. (a) Except as provided in this section, the common area in
a condominium project shall remain undivided, and there shall be no
judicial partition of the common area. Nothing in this section shall
be deemed to prohibit partition of a cotenancy of a separate interest
in a condominium.
(b) The owner of a separate interest in a condominium project may
maintain a partition action as to the entire project as if the owners
of all of the separate interests in the project were tenants in
common in the entire project in the same proportion as their
interests in the common areas. The court shall order partition under
this subdivision only by sale of the entire condominium project and
only upon a showing of one of the following:
(1) More than three years before the filing of the action, the
condominium project was damaged or destroyed, so that a material part
was rendered unfit for its prior use, and the condominium project
has not been rebuilt or repaired substantially to its state before
the damage or destruction.
(2) Three-fourths or more of the project is destroyed or
substantially damaged and owners of separate interests holding in the
aggregate more than a 50-percent interest in the common areas oppose
repair or restoration of the project.
(3) The project has been in existence more than 50 years, is
obsolete and uneconomic, and owners of separate interests holding in
the aggregate more than a 50-percent interest in the common area
oppose repair or restoration of the project.
(4) The conditions for such a sale, set forth in the declaration,
have been met.
5910. (a) In a condominium project, no labor performed or
services or materials furnished with the consent of, or at the
request of, an owner in the condominium project or the owner's agent
or contractor shall be the basis for the filing of a lien against the
property of any other owner in the condominium project unless that
other owner has expressly consented to or requested the performance
of the labor or furnishing of the materials
or services.
(b) Express consent shall be deemed to have been given by the
owner of any condominium in the case of emergency repairs to the
condominium.
(c) Labor performed or services or materials furnished for the
common area, if duly authorized by the association, shall be deemed
to be performed or furnished with the express consent of each
condominium owner.
(d) An owner may remove the owner's condominium from a lien
against two or more condominiums or any part thereof by payment to
the lien holder of the fraction of the total sum secured by the lien
that is attributable to the owner's condominium.
Article 5. Transfer of Separate Interest
5925. In a community apartment project, any conveyance, judicial
sale, or other voluntary or involuntary transfer of the separate
interest includes the undivided interest in the community apartment
project. Any conveyance, judicial sale, or other voluntary or
involuntary transfer of the owner's entire estate also includes the
owner's membership interest in the association.
5930. In a condominium project the common area is not subject to
partition, except as provided in Section 5905. Any conveyance,
judicial sale, or other voluntary or involuntary transfer of the
separate interest includes the undivided interest in the common area.
Any conveyance, judicial sale, or other voluntary or involuntary
transfer of the owner's entire estate also includes the owner's
membership interest in the association.
5935. In a planned development, any conveyance, judicial sale, or
other voluntary or involuntary transfer of the separate interest
includes the undivided interest in the common area. Any conveyance,
judicial sale, or other voluntary or involuntary transfer of the
owner's entire estate also includes the owner's membership interest
in the association.
5940. In a stock cooperative, any conveyance, judicial sale, or
other voluntary or involuntary transfer of the separate interest
includes the ownership interest in the corporation, however
evidenced. Any conveyance, judicial sale, or other voluntary or
involuntary transfer of the owner's entire estate also includes the
owner's membership interest in the association.
5945. Nothing in this article prohibits the transfer of exclusive
use common area, independent of any other interest in a common
interest development, if authorization to separately transfer
exclusive use common area is expressly stated in the declaration and
the transfer occurs in accordance with the terms of the declaration.
5950. Any restriction on the severability of the component
interests in real property which are contained in the declaration
shall not be deemed conditions repugnant to the interest created
within the meaning of Section 711 of the Civil Code. However, these
restrictions shall not extend beyond the period in which the right to
partition a project is suspended under Section 5905.
CHAPTER 8. GOVERNING DOCUMENTS
Article 1. General Provisions
6000. (a) For the purposes of this part, a common interest
development is created when a separate interest coupled with an
interest in the common area or membership in the association is, or
has been, conveyed, provided that all of the following are recorded:
(1) A declaration.
(2) A condominium plan, if any exists.
(3) A final map or parcel map, if Division 2 (commencing with
Section 66410) of Title 7 of the Government Code requires the
recording of either a final map or parcel map for the common interest
development.
(b) Notwithstanding subdivision (a), this part governs a stock
cooperative that has not recorded a declaration.
6005. (a) The articles of incorporation may not include a
provision that is inconsistent with the declaration. To the extent of
any inconsistency between the articles of incorporation and the
declaration, the declaration controls.
(b) The bylaws may not include a provision that is inconsistent
with the declaration or the articles of incorporation. To the extent
of any inconsistency between the bylaws and the articles of
incorporation or declaration, the articles of incorporation or
declaration control.
(c) The operating rules may not include a provision that is
inconsistent with the declaration, articles of incorporation, or
bylaws. To the extent of any inconsistency between the operating
rules and the bylaws, articles of incorporation, or declaration, the
bylaws, articles of incorporation, or declaration control.
(d) This section does not apply to a stock cooperative.
Article 2. Declaration
6025. A declaration, recorded on or after January 1, 1986, shall
contain all of the following:
(a) A legal description of the common interest development.
(b) A statement that the common interest development is a
community apartment project, condominium project, planned
development, stock cooperative, or combination thereof.
(c) The name of the association.
(d) Any restriction on the use or enjoyment of any portion of the
common interest development that is intended to be an enforceable
equitable servitude.
(e) Any other matter that the declarant or the members consider
appropriate.
6030. (a) If a common interest development is located within an
airport influence area and its declaration is recorded after January
1, 2004, the declaration shall contain the following statement:
"NOTICE OF AIRPORT IN VICINITY
This property is presently located in the vicinity of an airport,
within what is known as an airport influence area. For that reason,
the property may be subject to some of the annoyances or
inconveniences associated with proximity to airport operations (for
example: noise, vibration, or odors). Individual sensitivities to
those annoyances can vary from person to person. You may wish to
consider what airport annoyances, if any, are associated with the
property before you complete your purchase and determine whether they
are acceptable to you."
(b) For purposes of this section, an "airport influence area,"
also known as an "airport referral area," is the area in which
current or future airport-related noise, overflight, safety, or
airspace protection factors may significantly affect land uses or
necessitate restrictions on those uses as determined by an airport
land use commission.
(c) A statement in a declaration acknowledging that a property is
located in an airport influence area is not a title defect, lien, or
encumbrance.
6035. (a) If a common interest development is within the
jurisdiction of the San Francisco Bay Conservation and Development
Commission, as described in Section 66610 of the Government Code, and
its declaration is recorded on or after January 1, 2006, the
declaration shall contain the following notice:
"NOTICE OF SAN FRANCISCO BAY CONSERVATION AND DEVELOPMENT
COMMISSION JURISDICTION
This property is located within the jurisdiction of the San
Francisco Bay Conservation and Development Commission. Use and
development of property within the commission's jurisdiction may be
subject to special regulations, restrictions, and permit
requirements. You may wish to investigate and determine whether they
are acceptable to you and your intended use of the property before
you complete your transaction."
(b) A statement in a declaration acknowledging that a property is
located within the jurisdiction of the San Francisco Bay Conservation
and Development Commission is not a title defect, lien, or
encumbrance.
6040. (a) Unless a declaration expressly provides otherwise, any
provision of the declaration can be amended.
(b) If a provision of a declaration can be amended, it can be
amended at any time.
(c) The Legislature finds that there are common interest
developments that have been created with deed restrictions that do
not provide a means for the property owners to extend the term of the
declaration. The Legislature further finds that covenants and
restrictions, contained in the declaration, are an appropriate method
for protecting the common plan of developments and to provide for a
mechanism for financial support for the upkeep of common areas
including, but not limited to, roofs, roads, heating systems, and
recreational facilities. If declarations terminate prematurely,
common interest developments may deteriorate and the supply of
affordable housing units could be impacted adversely. The Legislature
further finds and declares that it is in the public interest to
provide a vehicle for extending the term of the declaration if owners
having more than 50 percent of the votes in the association choose
to do so.
(d) A declaration may be amended to extend the termination date of
the declaration, notwithstanding any contrary provision of the
declaration. No single extension of the term of the declaration made
pursuant to this subdivision shall exceed the initial term of the
declaration or 20 years, whichever is less. However, more than one
extension may be made pursuant to this subdivision.
6045. (a) If the governing documents provide a procedure for
approval of an amendment of the declaration, an amendment may be
approved by that procedure.
(b) If the governing documents do not provide a procedure for
approval of an amendment of the declaration, an amendment may be
approved by a majority of all members (Section 4065) and by any
person whose approval of a declaration amendment is specifically
required under the governing documents.
(c) The board shall provide individual notice (Section 4040) to
all members of an amendment approved under this section.
6050. Notwithstanding Section 6045, the deletion of a provision
of the declaration may be approved by the board (Section 4060) and by
a majority of a quorum of the members (Section 4070) if all of the
following conditions are satisfied:
(a) The provision to be deleted is unequivocally designed and
intended, or by its nature can only have been designed or intended,
to facilitate the developer in completing the construction or
marketing of the development or of a particular phase of the
development.
(b) The provision to be deleted authorizes access by the developer
over or across the common area for the purposes of (1) completion of
construction of the development, and (2) the erection, construction,
or maintenance of structures or other facilities designed to
facilitate the completion of construction or marketing of separate
interests.
(c) The construction or marketing activities governed by the
provision to be deleted have been completed or terminated.
6055. Notwithstanding any contrary provision of the governing
documents, an amendment approved pursuant to this article becomes
effective once the following actions have been completed:
(a) An officer of the association certifies, in a writing that is
signed and acknowledged by the officer, that the amendment was
approved pursuant to this article. The certifying officer is the
officer designated for that purpose by the governing documents, or if
no one is designated, the president of the association.
(b) The written certification and the amended text of the
declaration are recorded in each county in which the common interest
development is located.
Article 3. Articles of Incorporation
6060. (a) The articles of incorporation of an association that
are filed with the Secretary of State on or after January 1, 1995,
shall include all of the following:
(1) A statement that the corporation is an association formed to
manage a common interest development under the Davis-Stirling Common
Interest Development Act.
(2) The address of the business or corporate office of the
association, if any.
(3) If the association has no business or corporate office, or if
the business or corporate office is not on the site of the common
interest development, the nine-digit ZIP Code, front street, and
nearest cross street for the physical location of the common interest
development.
(4) The name and address of the association's managing agent, if
any.
(b) The statement of principal business activity contained in the
annual statement filed by an incorporated association with the
Secretary of State pursuant to Section 1502 of the Corporations Code
shall also contain the information specified in subdivision (a).
Article 4. Condominium Plan
6075. A condominium plan shall include all of the following:
(a) A description or survey map of a condominium project, which
shall refer to or show monumentation on the ground.
(b) A three-dimensional description of a condominium project, one
or more dimensions of which may extend for an indefinite distance
upwards or downwards, in sufficient detail to identify the common
areas and each separate interest.
(c) A certificate consenting to the recordation of the condominium
plan pursuant to this part signed and acknowledged by all of the
following persons:
(1) The record owner of fee title to that property included in the
condominium project.
(2) In the case of a condominium project that will terminate upon
the termination of an estate for years, by all lessors and lessees of
the estate for years.
(3) In the case of a condominium project subject to a life estate,
by all life tenants and remainder interests.
(4) The trustee or the beneficiary of each recorded deed of trust,
and the mortgagee of each recorded mortgage encumbering the
property.
(5) In a conversion of a community apartment project or stock
cooperative to a condominium project that has been approved by the
required number of owners, trustees, beneficiaries, and mortgagees
pursuant to Section 66452.10 of the Government Code, by those owners,
trustees, beneficiaries, and mortgagees who approved the conversion.
(d) A person who owns only a mineral right, easement,
right-of-way, or other nonpossessory interest in the property that is
included in the condominium project does not need to sign the
condominium plan.
6080. A condominium plan may be amended or revoked by a recorded
instrument that is acknowledged and signed by all the persons whose
signatures are required pursuant to subdivision (c) of Section 6075.
Article 5. Operating Rules
6100. An operating rule is valid and enforceable only if all of
the following requirements are satisfied:
(a) The rule is in writing.
(b) The rule is within the authority of the board conferred by law
or by the declaration, articles of incorporation or association, or
bylaws of the association.
(c) The rule is not inconsistent with governing law and the
declaration, articles of incorporation or association, and bylaws of
the association.
(d) The rule is adopted, amended, or repealed in good faith and in
substantial compliance with the requirements of this chapter.
(e) The rule is reasonable.
6110. (a) Sections 6115 and 6120 only apply to an operating rule
that relates to one or more of the following subjects:
(1) Use of the common area or of an exclusive use common area.
(2) Use of a separate interest, including any aesthetic or
architectural standards that govern alteration of a separate
interest.
(3) Member discipline, including any schedule of monetary
penalties for violation of the governing documents and any procedure
for the imposition of penalties.
(4) Any standards for delinquent assessment payment plans.
(5) Any procedures adopted by the association for resolution of
disputes.
(6) Any procedures for reviewing and approving or disapproving a
proposed physical change to a member's separate interest or to the
common area.
(7) Any procedure for the conduct of an election.
(b) Sections 6115 and 6120 do not apply to the following actions
by the board:
(1) A decision regarding maintenance of the common area.
(2) A decision on a specific matter that is not intended to apply
generally.
(3) A decision setting the amount of a regular or special
assessment.
(4) A rule change that is required by law, if the board has no
discretion as to the substantive effect of the rule change.
(5) Issuance of a document that merely repeats existing law or the
governing documents.
6115. (a) The board shall provide general notice (Section 4045)
of a proposed rule change at least 30 days before making the rule
change. The notice shall include the text of the proposed rule change
and a description of the purpose and effect of the proposed rule
change. Notice is not required under this subdivision if the board
determines that an immediate rule change is necessary to address an
imminent threat to public health or safety or imminent risk of
substantial economic loss to the association.
(b) A proposed rule change may be approved by the board (Section
4060).
(c) As soon as possible after approving a rule change, but not
more than 15 days after approving the rule change, the board shall
provide general notice (Section 4045) of the rule change. If the rule
change was an emergency rule change made under subdivision (d), the
notice shall include the text of the rule change, a description of
the purpose and effect of the rule change, and the date that the rule
change expires.
(d) If the board determines that an immediate rule change is
required to address an imminent threat to public health or safety, or
an imminent risk of substantial economic loss to the association,
the board may approve an emergency rule change (Section 4060) without
providing general notice (Section 4045) of the proposed rule change.
An emergency rule change is effective for 120 days, unless the board
provides for a shorter effective period. A rule change made under
this subdivision may not be readopted under this subdivision.
6120. (a) Members of an association owning 5 percent or more of
the separate interests may call a special member meeting to reverse a
rule change that was approved by the board.
(b) A special member meeting may be called by delivering a request
to the board (Section 4035) that includes the requisite number of
member signatures, after which the board shall provide general notice
(Section 4045) of the meeting and hold the meeting in conformity
with Article 2 (commencing with Section 4500) of Chapter 3. A written
request may only be delivered within 30 days after general notice
(Section 4045) of the rule change or enforcement of the resulting
rule, whichever occurs first.
(c) For the purposes of Article 5 (commencing with Section 4700)
of Chapter 3, collection of signatures to call a special meeting
under this section is a purpose reasonably related to the interests
of the members of the association. A member request to copy or
inspect the membership list solely for that purpose may not be denied
on the grounds that the purpose is not reasonably related to the
member's interests as a member.
(d) A decision to reverse a rule change may be approved by a
majority of a quorum of the members (Section 4070), or if the
declaration or bylaws require a greater proportion, by the
affirmative vote of the proportion required. In lieu of calling the
meeting described in this section, the board may distribute a written
ballot to every member of the association pursuant to Section 4640.
(e) Unless otherwise provided in the declaration, articles of
incorporation, or bylaws, for the purposes of this section, a member
may cast one vote per separate interest owned.
(f) A meeting called under this section is governed by Article 3
(commencing with Section 4575) and Article 4 (commencing with Section
4625) of Chapter 3.
(g) A rule change reversed under this section may not be readopted
for one year after the date of the meeting reversing the rule
change. Nothing in this section precludes the board from adopting a
different rule on the same subject as the rule change that has been
reversed.
(h) As soon as possible after the close of voting, but not more
than 15 days after the close of voting, the board shall provide
general notice (Section 4045) of the results of the member vote.
(i) This section does not apply to an emergency rule change made
under subdivision (d) of Section 6115.
6125. (a) This article applies to a rule change commenced on or
after January 1, 2004.
(b) Nothing in this article affects the validity of a rule change
commenced before January 1, 2004.
(c) For the purposes of this section, a rule change is commenced
when the board takes its first official action leading to adoption of
the rule change.
Article 6. Unlawful Restrictions
6150. (a) No governing document shall include a restrictive
covenant or other provision in violation of Section 12955 of the
Government Code.
(b) Notwithstanding any other provision of law or provision of the
governing documents, the board shall amend the governing documents
to delete the unlawful restrictive provision and to restate the
governing document without the deleted restrictive provision. No
other person is required to approve the amendment.
(c) If the declaration is amended under this section, the board
shall record the restated declaration in each county in which the
common interest development is located. If the articles of
incorporation are amended under this section, the board shall file a
certificate of amendment pursuant to Section 7814 of the Corporations
Code.
(d) The Department of Fair Employment and Housing, a city or
county in which a common interest development is located, or any
other person may provide written notice to a board (Section 4035)
requesting that it comply with this section. If the board fails to
comply with this section within 30 days after delivery of the notice
under this subdivision, the person who sent the notice may bring an
action against the association for injunctive relief to enforce this
section. The court may award attorney's fees to the prevailing party.
Article 7. Construction of Documents
6175. (a) Any deed, declaration, or condominium plan for a common
interest development shall be liberally construed to facilitate the
operation of the common interest development, and its provisions
shall be presumed to be independent and severable.
(b) Nothing in Article 3 (commencing with Section 715) of Chapter
2 of Title 2 of Part 1 of Division 2 shall operate to invalidate any
provisions of the governing documents of a common interest
development.
6180. In interpreting a deed or condominium plan, the existing
physical boundaries of a unit in a condominium project, when the
boundaries of the unit are contained within a building, or of a unit
reconstructed in substantial accordance with the original plans
thereof, shall be conclusively presumed to be its boundaries rather
than the metes and bounds expressed in the deed or condominium plan,
if any exists, regardless of settling or lateral movement of the
building and regardless of minor variance between boundaries shown on
the plan or in the deed and those of the building.
CHAPTER 9. CONSTRUCTION DEFECT LITIGATION
6200. (a) Before an association files a complaint for damages
against a builder, developer, or general contractor ("respondent") of
a common interest development based upon a claim for defects in the
design or construction of the common interest development, all of the
requirements of this section shall be satisfied with respect to the
builder, developer, or general contractor.
(b) The association shall serve upon the respondent a "Notice of
Commencement of Legal Proceedings." The notice shall be served by
certified mail to the registered agent of the respondent, or if there
is no registered agent, then to any officer of the respondent. If
there are no current officers of the respondent, service shall be
upon the person or entity otherwise authorized by law to receive
service of process. Service upon the general contractor shall be
sufficient to initiate the process set forth in this section with
regard to any builder or developer, if the builder or developer is
not amenable to service of process by the foregoing methods. This
notice shall toll all applicable statutes of limitation and repose,
whether contractual or statutory, by and against all potentially
responsible parties, regardless of whether they were named in the
notice, including claims for indemnity applicable to the claim for
the period set forth in subdivision (c). The notice shall include all
of the following:
(1) The name and location of the project.
(2) An initial list of defects sufficient to apprise the
respondent of the general nature of the defects at issue.
(3) A description of the results of the defects, if known.
(4) A summary of the results of a survey or questionnaire
distributed to homeowners to determine the nature and extent of
defects, if a survey has been conducted or a questionnaire has been
distributed.
(5) Either a summary of the results of testing conducted to
determine the nature and extent of defects or the actual test
results, if that testing has been conducted.
(c) Service of the notice shall commence a period, not to exceed
180 days, during which the association, the respondent, and all other
participating parties shall try to resolve the dispute through the
processes set forth in this section. This 180-day period may be
extended for one additional period, not to exceed 180 days, only upon
the mutual agreement of the association, the respondent, and any
parties not deemed peripheral pursuant to paragraph (3) of
subdivision (e). Any extensions beyond the first extension shall
require the agreement of all participating parties. Unless extended,
the dispute resolution process prescribed by this section shall be
deemed completed. All extensions shall continue the tolling period
described in subdivision (b).
(d) Within 25 days of the date the association serves the Notice
of Commencement of Legal Proceedings, the respondent may request in
writing to meet and confer with the board of directors of the
association. Unless the respondent and the association otherwise
agree, there shall be not more than one meeting, which shall take
place no later than 10 days from the date of the respondent's written
request, at a mutually agreeable time and place. The meeting shall
be subject to Sections 4525 and 4540. The discussions at the meeting
are privileged communications and are not admissible in evidence in
any civil action, unless the association and the respondent consent
in writing to their admission.
(e) Upon receipt of the notice, the respondent shall, within 60
days, comply with the following:
(1) The respondent shall provide the association with access to,
for inspection and copying of, all plans and specifications,
subcontracts, and other construction files for the project that are
reasonably calculated to
lead to the discovery of admissible evidence regarding the defects
claimed. The association shall provide the respondent with access to,
for inspection and copying of, all files reasonably calculated to
lead to the discovery of admissible evidence regarding the defects
claimed, including all reserve studies, maintenance records and any
survey questionnaires, or results of testing to determine the nature
and extent of defects. To the extent any of the above documents are
withheld based on privilege, a privilege log shall be prepared and
submitted to all other parties. All other potentially responsible
parties shall have the same rights as the respondent regarding the
production of documents upon receipt of written notice of the claim,
and shall produce all relevant documents within 60 days of receipt of
the notice of the claim.
(2) The respondent shall provide written notice by certified mail
to all subcontractors, design professionals, their insurers, and the
insurers of any additional insured whose identities are known to the
respondent or readily ascertainable by review of the project files or
other similar sources and whose potential responsibility appears on
the face of the notice. This notice to subcontractors, design
professionals, and insurers shall include a copy of the Notice of
Commencement of Legal Proceedings, and shall specify the date and
manner by which the parties shall meet and confer to select a dispute
resolution facilitator pursuant to paragraph (1) of subdivision (f),
advise the recipient of its obligation to participate in the meet
and confer or serve a written acknowledgment of receipt regarding
this notice, advise the recipient that it will waive any challenge to
selection of the dispute resolution facilitator if it elects not to
participate in the meet and confer, advise the recipient that it may
be bound by any settlement reached pursuant to subdivision (d) of
Section 6205, advise the recipient that it may be deemed to have
waived rights to conduct inspection and testing pursuant to
subdivision (c) of Section 6205, advise the recipient that it may
seek the assistance of an attorney, and advise the recipient that it
should contact its insurer, if any. Any subcontractor or design
professional, or insurer for that subcontractor, design professional,
or additional insured, who receives written notice from the
respondent regarding the meet and confer shall, prior to the meet and
confer, serve on the respondent a written acknowledgment of receipt.
That subcontractor or design professional shall, within 10 days of
service of the written acknowledgment of receipt, provide to the
association and the respondent a Statement of Insurance that includes
both of the following:
(A) The names, addresses, and contact persons, if known, of all
insurance carriers, whether primary or excess and regardless of
whether a deductible or self-insured retention applies, whose
policies were in effect from the commencement of construction of the
subject project to the present and which potentially cover the
subject claims.
(B) The applicable policy numbers for each policy of insurance
provided.
(3) Any subcontractor or design professional, or insurer for that
subcontractor, design professional, or additional insured, who so
chooses, may, at any time, make a written request to the dispute
resolution facilitator for designation as a peripheral party. That
request shall be served contemporaneously on the association and the
respondent. If no objection to that designation is received within 15
days, or upon rejection of that objection, the dispute resolution
facilitator shall designate that subcontractor or design professional
as a peripheral party, and shall thereafter seek to limit the
attendance of that subcontractor or design professional only to those
dispute resolution sessions deemed peripheral party sessions or to
those sessions during which the dispute resolution facilitator
believes settlement as to peripheral parties may be finalized.
Nothing in this subdivision shall preclude a party who has been
designated a peripheral party from being reclassified as a
nonperipheral party, nor shall this subdivision preclude a party
designated as a nonperipheral party from being reclassified as a
peripheral party after notice to all parties and an opportunity to
object. For purposes of this subdivision, a peripheral party is a
party having total claimed exposure of less than twenty-five thousand
dollars ($25,000).
(f) (1) Within 20 days of sending the notice set forth in
paragraph (2) of subdivision (e), the association, respondent,
subcontractors, design professionals, and their insurers who have
been sent a notice as described in paragraph (2) of subdivision (e)
shall meet and confer in an effort to select a dispute resolution
facilitator to preside over the mandatory dispute resolution process
prescribed by this section. Any subcontractor or design professional
who has been given timely notice of this meeting but who does not
participate, waives any challenge he or she may have as to the
selection of the dispute resolution facilitator. The role of the
dispute resolution facilitator is to attempt to resolve the conflict
in a fair manner. The dispute resolution facilitator shall be
sufficiently knowledgeable in the subject matter and be able to
devote sufficient time to the case. The dispute resolution
facilitator shall not be required to reside in or have an office in
the county in which the project is located. The dispute resolution
facilitator and the participating parties shall agree to a date,
time, and location to hold a case management meeting of all parties
and the dispute resolution facilitator, to discuss the claims being
asserted and the scheduling of events under this section. The case
management meeting with the dispute resolution facilitator shall be
held within 100 days of service of the Notice of Commencement of
Legal Proceedings at a location in the county where the project is
located. Written notice of the case management meeting with the
dispute resolution facilitator shall be sent by the respondent to the
association, subcontractors and design professionals, and their
insurers who are known to the respondent to be on notice of the
claim, no later than 10 days prior to the case management meeting,
and shall specify its date, time, and location. The dispute
resolution facilitator in consultation with the respondent shall
maintain a contact list of the participating parties.
(2) No later than 10 days prior to the case management meeting,
the dispute resolution facilitator shall disclose to the parties all
matters that could cause a person aware of the facts to reasonably
entertain a doubt that the proposed dispute resolution facilitator
would be able to resolve the conflict in a fair manner. The
facilitator's disclosure shall include the existence of any ground
specified in Section 170.1 of the Code of Civil Procedure for
disqualification of a judge, any attorney-client relationship the
facilitator has or had with any party or lawyer for a party to the
dispute resolution process, and any professional or significant
personal relationship the facilitator or his or her spouse or minor
child living in the household has or had with any party to the
dispute resolution process. The disclosure shall also be provided to
any subsequently noticed subcontractor or design professional within
10 days of the notice.
(3) A dispute resolution facilitator shall be disqualified by the
court if he or she fails to comply with this paragraph and any party
to the dispute resolution process serves a notice of disqualification
prior to the case management meeting. If the dispute resolution
facilitator complies with this paragraph, he or she shall be
disqualified by the court on the basis of the disclosure if any party
to the dispute resolution process serves a notice of
disqualification prior to the case management meeting.
(4) If the parties cannot mutually agree to a dispute resolution
facilitator, then each party shall submit a list of three dispute
resolution facilitators. Each party may then strike one nominee from
the other parties' list, and petition the court, pursuant to the
procedure described in subdivisions (n) and (o), for final selection
of the dispute resolution facilitator. The court may issue an order
for final selection of the dispute resolution facilitator pursuant to
this paragraph.
(5) Any subcontractor or design professional who receives notice
of the association's claim without having previously received timely
notice of the meet and confer to select the dispute resolution
facilitator shall be notified by the respondent regarding the name,
address, and telephone number of the dispute resolution facilitator.
Any such subcontractor or design professional may serve upon the
parties and the dispute resolution facilitator a written objection to
the dispute resolution facilitator within 15 days of receiving
notice of the claim. Within seven days after service of this
objection, the subcontractor or design professional may petition the
superior court to replace the dispute resolution facilitator. The
court may replace the dispute resolution facilitator only upon a
showing of good cause, liberally construed. Failure to satisfy the
deadlines set forth in this subdivision shall constitute a waiver of
the right to challenge the dispute resolution facilitator.
(6) The costs of the dispute resolution facilitator shall be
apportioned in the following manner: one-third to be paid by the
association; one-third to be paid by the respondent; and one-third to
be paid by the subcontractors and design professionals, as allocated
among them by the dispute resolution facilitator. The costs of the
dispute resolution facilitator shall be recoverable by the prevailing
party in any subsequent litigation pursuant to Section 1032 of the
Code of Civil Procedure, provided however that any nonsettling party
may, prior to the filing of the complaint, petition the facilitator
to reallocate the costs of the dispute resolution facilitator as they
apply to any nonsettling party. The determination of the dispute
resolution facilitator with respect to the allocation of these costs
shall be binding in any subsequent litigation. The dispute resolution
facilitator shall take into account all relevant factors and
equities between all parties in the dispute resolution process when
reallocating costs.
(7) In the event the dispute resolution facilitator is replaced at
any time, the case management statement created pursuant to
subdivision (h) shall remain in full force and effect.
(8) The dispute resolution facilitator shall be empowered to
enforce all provisions of this section.
(g) (1) No later than the case management meeting, the parties
shall begin to generate a data compilation showing the following
information regarding the alleged defects at issue:
(A) The scope of the work performed by each potentially
responsible subcontractor.
(B) The tract or phase number in which each subcontractor provided
goods or services, or both.
(C) The units, either by address, unit number, or lot number, at
which each subcontractor provided goods or services, or both.
(2) This data compilation shall be updated as needed to reflect
additional information. Each party attending the case management
meeting, and any subsequent meeting pursuant to this section, shall
provide all information available to that party relevant to this data
compilation.
(h) At the case management meeting, the parties shall, with the
assistance of the dispute resolution facilitator, reach agreement on
a case management statement, which shall set forth all of the
elements set forth in paragraphs (1) to (8), inclusive, except that
the parties may dispense with one or more of these elements if they
agree that it is appropriate to do so. The case management statement
shall provide that the following elements shall take place in the
following order:
(1) Establishment of a document depository, located in the county
where the project is located, for deposit of documents, defect lists,
demands, and other information provided for under this section. All
documents exchanged by the parties and all documents created pursuant
to this subdivision shall be deposited in the document depository,
which shall be available to all parties throughout the prefiling
dispute resolution process and in any subsequent litigation. When any
document is deposited in the document depository, the party
depositing the document shall provide written notice identifying the
document to all other parties. The costs of maintaining the document
depository shall be apportioned among the parties in the same manner
as the costs of the dispute resolution facilitator.
(2) Provision of a more detailed list of defects by the
association to the respondent after the association completes a
visual inspection of the project. This list of defects shall provide
sufficient detail for the respondent to ensure that all potentially
responsible subcontractors and design professionals are provided with
notice of the dispute resolution process. If not already completed
prior to the case management meeting, the Notice of Commencement of
Legal Proceedings shall be served by the respondent on all additional
subcontractors and design professionals whose potential
responsibility appears on the face of the more detailed list of
defects within seven days of receipt of the more detailed list. The
respondent shall serve a copy of the case management statement,
including the name, address, and telephone number of the dispute
resolution facilitator, to all the potentially responsible
subcontractors and design professionals at the same time.
(3) Nonintrusive visual inspection of the project by the
respondent, subcontractors, and design professionals.
(4) Invasive testing conducted by the association, if the
association deems appropriate. All parties may observe and photograph
any testing conducted by the association pursuant to this paragraph,
but may not take samples or direct testing unless, by mutual
agreement, costs of testing are shared by the parties.
(5) Provision by the association of a comprehensive demand which
provides sufficient detail for the parties to engage in meaningful
dispute resolution as contemplated under this section.
(6) Invasive testing conducted by the respondent, subcontractors,
and design professionals, if they deem appropriate.
(7) Allowance for modification of the demand by the association if
new issues arise during the testing conducted by the respondent,
subcontractor, or design professionals.
(8) Facilitated dispute resolution of the claim, with all parties,
including peripheral parties, as appropriate, and insurers, if any,
present and having settlement authority. The dispute resolution
facilitators shall endeavor to set specific times for the attendance
of specific parties at dispute resolution sessions. If the dispute
resolution facilitator does not set specific times for the attendance
of parties at dispute resolution sessions, the dispute resolution
facilitator shall permit those parties to participate in dispute
resolution sessions by telephone.
(i) In addition to the foregoing elements of the case management
statement described in subdivision (h), upon mutual agreement of the
parties, the dispute resolution facilitator may include any or all of
the following elements in a case management statement: the exchange
of consultant or expert photographs; expert presentations; expert
meetings; or any other mechanism deemed appropriate by the parties in
the interest of resolving the dispute.
(j) The dispute resolution facilitator, with the guidance of the
parties, shall at the time the case management statement is
established, set deadlines for the occurrence of each event set forth
in the case management statement, taking into account such factors
as the size and complexity of the case, and the requirement of this
section that this dispute resolution process not exceed 180 days
absent agreement of the parties to an extension of time.
(k) (1) (A) At a time to be determined by the dispute resolution
facilitator, the respondent may submit to the association all of the
following:
(i) A request to meet with the board to discuss a written
settlement offer.
(ii) A written settlement offer, and a concise explanation of the
reasons for the terms of the offer.
(iii) A statement that the respondent has access to sufficient
funds to satisfy the conditions of the settlement offer.
(iv) A summary of the results of testing conducted for the
purposes of determining the nature and extent of defects, if this
testing has been conducted, unless the association provided the
respondent with actual test results.
(B) If the respondent does not timely submit the items required by
this subdivision, the association shall be relieved of any further
obligation to satisfy the requirements of this subdivision only.
(C) No less than 10 days after the respondent submits the items
required by this paragraph, the respondent and the board of directors
of the association shall meet and confer about the respondent's
settlement offer.
(D) If the association's board of directors rejects a settlement
offer presented at the meeting held pursuant to this subdivision, the
board shall hold a meeting open to each member of the association.
The meeting shall be held no less than 15 days before the association
commences an action for damages against the respondent.
(E) No less than 15 days before this meeting is held, a written
notice shall be sent to each member of the association specifying all
of the following:
(i) That a meeting will take place to discuss problems that may
lead to the filing of a civil action, and the time and place of this
meeting.
(ii) The options that are available to address the problems,
including the filing of a civil action and a statement of the various
alternatives that are reasonably foreseeable by the association to
pay for those options and whether these payments are expected to be
made from the use of reserve account funds or the imposition of
regular or special assessments, or emergency assessment increases.
(iii) The complete text of any written settlement offer, and a
concise explanation of the specific reasons for the terms of the
offer submitted to the board at the meeting held pursuant to
subdivision (d) that was received from the respondent.
(F) The respondent shall pay all expenses attributable to sending
the settlement offer to all members of the association. The
respondent shall also pay the expense of holding the meeting, not to
exceed three dollars ($3) per association member.
(G) The discussions at the meeting and the contents of the notice
and the items required to be specified in the notice pursuant to
paragraph (E) are privileged communications and are not admissible in
evidence in any civil action, unless the association consents to
their admission.
(H) No more than one request to meet and discuss a written
settlement offer may be made by the respondent pursuant to this
subdivision.
(l) Except for the purpose of in camera review as provided in
subdivision (c) of Section 6205, all defect lists and demands,
communications, negotiations, and settlement offers made in the
course of the prelitigation dispute resolution process provided by
this section shall be inadmissible pursuant to Sections 1119 to 1124,
inclusive, of the Evidence Code and all applicable decisional law.
This inadmissibility shall not be extended to any other documents or
communications which would not otherwise be deemed inadmissible.
(m) Any subcontractor or design professional may, at any time,
petition the dispute resolution facilitator to release that party
from the dispute resolution process upon a showing that the
subcontractor or design professional is not potentially responsible
for the defect claims at issue. The petition shall be served
contemporaneously on all other parties, who shall have 15 days from
the date of service to object. If a subcontractor or design
professional is released, and it later appears to the dispute
resolution facilitator that it may be a responsible party in light of
the current defect list or demand, the respondent shall renotice the
party as provided by paragraph (2) of subdivision (e), provide a
copy of the current defect list or demand, and direct the party to
attend a dispute resolution session at a stated time and location. A
party who subsequently appears after having been released by the
dispute resolution facilitator shall not be prejudiced by its absence
from the dispute resolution process as the result of having been
previously released by the dispute resolution facilitator.
(n) Any party may, at any time, petition the superior court in the
county where the project is located, upon a showing of good cause,
and the court may issue an order, for any of the following, or for
appointment of a referee to resolve a dispute regarding any of the
following:
(1) To take a deposition of any party to the process, or subpoena
a third party for deposition or production of documents, which is
necessary to further prelitigation resolution of the dispute.
(2) To resolve any disputes concerning inspection, testing,
production of documents, or exchange of information provided for
under this section.
(3) To resolve any disagreements relative to the timing or
contents of the case management statement.
(4) To authorize internal extensions of timeframes set forth in
the case management statement.
(5) To seek a determination that a settlement is a good faith
settlement pursuant to Section 877.6 of the Code of Civil Procedure
and all related authorities. The page limitations and meet and confer
requirements specified in this section shall not apply to these
motions, which may be made on shortened notice. Instead, these
motions shall be subject to other applicable state law, rules of
court, and local rules. A determination made by the court pursuant to
this motion shall have the same force and effect as the
determination of a postfiling application or motion for good faith
settlement.
(6) To ensure compliance, on shortened notice, with the obligation
to provide a Statement of Insurance pursuant to paragraph (2) of
subdivision (e).
(7) For any other relief appropriate to the enforcement of the
provisions of this section, including the ordering of parties, and
insurers, if any, to the dispute resolution process with settlement
authority.
(o) (1) A petition filed pursuant to subdivision (n) shall be
filed in the superior court in the county in which the project is
located. The court shall hear and decide the petition within 10 days
after filing. The petitioning party shall serve the petition on all
parties, including the date, time, and location of the hearing no
later than five business days prior to the hearing. Any responsive
papers shall be filed and served no later than three business days
prior to the hearing. Any petition or response filed under this
section shall be no more than three pages in length.
(2) All parties shall meet with the dispute resolution
facilitator, if one has been appointed, and confer in person or by
the telephone prior to the filing of that petition to attempt to
resolve the matter without requiring court intervention.
(p) As used in this section:
(1) "Association" shall have the same meaning as defined in
Section 4080.
(2) "Builder" means the declarant, as defined in Section 4130.
(3) "Common interest development" shall have the same meaning as
in Section 4100, except that it shall not include developments or
projects with less than 20 units.
(q) The alternative dispute resolution process and procedures
described in this section shall have no application or legal effect
other than as described in this section.
(r) This section shall become operative on July 1, 2002, however
it shall not apply to any pending suit or claim for which notice has
previously been given.
(s) This section shall become inoperative on July 1, 2010, and as
of January 1, 2011, is repealed, unless a later enacted statute, that
is enacted before January 1, 2011, deletes or extends the dates on
which it becomes inoperative and is repealed.
6205. (a) Upon the completion of the mandatory prefiling dispute
resolution process described in Section 6200, if the parties have not
settled the matter, the association or its assignee may file a
complaint in the superior court in the county in which the project is
located. Those matters shall be given trial priority.
(b) In assigning trial priority, the court shall assign the
earliest possible trial date, taking into consideration the pretrial
preparation completed pursuant to Section 6200, and shall deem the
complaint to have been filed on the date of service of the Notice of
Commencement of Legal Proceedings described under Section 6200.
(c) Any respondent, subcontractor, or design professional who
received timely prior notice of the inspections and testing conducted
under Section 6200 shall be prohibited from engaging in additional
inspection or testing, except if all of the following specific
conditions are met, upon motion to the court:
(1) There is an insurer for a subcontractor or design
professional, that did not have timely notice that legal proceedings
were commenced under Section 6200 at least 30 days prior to the
commencement of inspections or testing pursuant to paragraph (6) of
subdivision (h) of Section 6200.
(2) The insurer's insured did not participate in any inspections
or testing conducted under the provisions of paragraph (6) of
subdivision (h) of Section 6200.
(3) The insurer has, after receiving notice of a complaint filed
in superior court under subdivision (a), retained separate counsel,
who did not participate in the Section 6200 dispute resolution
process, to defend its insured as to the allegations in the
complaint.
(4) It is reasonably likely that the insured would suffer
prejudice if additional inspections or testing are not permitted.
(5) The information obtainable through the proposed additional
inspections or testing is not available through any reasonable
alternative sources.
If the court permits additional inspections or testing upon
finding that these requirements are met, any additional inspections
or testing shall be limited to the extent reasonably necessary to
avoid the likelihood of prejudice and shall be coordinated among all
similarly situated parties to ensure that they occur without
unnecessary duplication. For purposes of providing notice to an
insurer prior to inspections or testing under paragraph (6) of
subdivision (h) of Section 6200,
if notice of the proceedings was not provided by the
insurer's insured, notice may be made via certified mail either by
the subcontractor, design professional, association, or respondent to
the address specified in the Statement of Insurance provided under
paragraph (2) of subdivision (e) of Section 6200. Nothing herein
shall affect the rights of an intervenor who files a complaint in
intervention. If the association alleges defects that were not
specified in the prefiling dispute resolution process under Section
6200, the respondent, subcontractor, and design professionals shall
be permitted to engage in testing or inspection necessary to respond
to the additional claims. A party who seeks additional inspections or
testing based upon the amendment of claims shall apply to the court
for leave to conduct those inspections or that testing. If the court
determines that it must review the defect claims alleged by the
association in the prefiling dispute resolution process in order to
determine whether the association alleges new or additional defects,
this review shall be conducted in camera. Upon objection of any
party, the court shall refer the matter to a judge other than the
assigned trial judge to determine if the claim has been amended in a
way that requires additional testing or inspection.
(d) Any subcontractor or design professional who had notice of the
facilitated dispute resolution conducted under Section 6200 but
failed to attend, or attended without settlement authority, shall be
bound by the amount of any settlement reached in the facilitated
dispute resolution in any subsequent trial, although the affected
party may introduce evidence as to the allocation of the settlement.
Any party who failed to participate in the facilitated dispute
resolution because the party did not receive timely notice of the
mediation shall be relieved of any obligation to participate in the
settlement. Notwithstanding any privilege applicable to the prefiling
dispute resolution process provided by Section 6200, evidence may be
introduced by any party to show whether a subcontractor or design
professional failed to attend or attended without settlement
authority. The binding effect of this subdivision shall in no way
diminish or reduce a nonsettling subcontractor or design professional'
s right to defend itself or assert all available defenses relevant to
its liability in any subsequent trial. For purposes of this
subdivision, a subcontractor or design professional shall not be
deemed to have attended without settlement authority because it
asserted defenses to its potential liability.
(e) Notice of the facilitated dispute resolution conducted under
Section 6200 must be mailed by the respondent no later than 20 days
prior to the date of the first facilitated dispute resolution session
to all parties. Notice shall also be mailed to each of these parties'
known insurance carriers. Mailing of this notice shall be by
certified mail. Any subsequent facilitated dispute resolution notices
shall be served by any means reasonably calculated to provide those
parties actual notice.
(f) As to the complaint, the order of discovery shall, at the
request of any defendant, except upon a showing of good cause, permit
the association's expert witnesses to be deposed prior to any
percipient party depositions. The depositions shall, at the request
of the association, be followed immediately by the defendant's
experts and then by the subcontractors' and design professionals'
experts, except on a showing of good cause. For purposes of this
section, in determining what constitutes "good cause," the court
shall consider, among other things, the goal of early disclosure of
defects and whether the expert is prepared to render a final opinion,
except that the court may modify the scope of any expert's
deposition to address those concerns.
(g) (1) The only method of seeking judicial relief for the failure
of the association or the respondent to complete the dispute
resolution process under Section 6200 shall be the assertion, as
provided for in this subdivision, of a procedural deficiency to an
action for damages by the association against the respondent after
that action has been filed. A verified application asserting a
procedural deficiency shall be filed with the court no later than 90
days after the answer to the plaintiff's complaint has been served,
unless the court finds that extraordinary conditions exist.
(2) Upon the verified application of the association or the
respondent alleging substantial noncompliance with Section 6200, the
court shall schedule a hearing within 21 days of the application to
determine whether the association or respondent has substantially
complied with this section. The issue may be determined upon
affidavits or upon oral testimony, in the discretion of the court.
(3) (A) If the court finds that the association or the respondent
did not substantially comply with this paragraph, the court shall
stay the action for up to 90 days to allow the noncomplying party to
establish substantial compliance. The court shall set a hearing
within 90 days to determine substantial compliance. At any time, the
court may, for good cause shown, extend the period of the stay upon
application of the noncomplying party.
(B) If, within the time set by the court pursuant to this
paragraph, the association or the respondent has not established that
it has substantially complied with this section, the court shall
determine if, in the interest of justice, the action should be
dismissed without prejudice, or if another remedy should be
fashioned. Under no circumstances shall the court dismiss the action
with prejudice as a result of the association's failure to
substantially comply with this section. In determining the
appropriate remedy, the court shall consider the extent to which the
respondent has complied with this section.
(h) This section is operative on July 1, 2002, but does not apply
to any action or proceeding pending on that date.
(i) This section shall become inoperative on July 1, 2010, and, as
of January 1, 2011, is repealed, unless a later enacted statute that
is enacted before January 1, 2011, deletes or extends the dates on
which it becomes inoperative and is repealed.
6210. (a) As soon as is reasonably practicable after the
association and the builder have entered into a settlement agreement
or the matter has otherwise been resolved regarding alleged defects
in the common areas, alleged defects in the separate interests that
the association is obligated to maintain or repair, or alleged
defects in the separate interests that arise out of, or are
integrally related to, defects in the common areas or separate
interests that the association is obligated to maintain or repair,
where the defects giving rise to the dispute have not been corrected,
the association shall, in writing, inform only the members of the
association whose names appear on the records of the association that
the matter has been resolved, by settlement agreement or other
means, and disclose all of the following:
(1) A general description of the defects that the association
reasonably believes, as of the date of the disclosure, will be
corrected or replaced.
(2) A good faith estimate, as of the date of the disclosure, of
when the association believes that the defects identified in
paragraph (1) will be corrected or replaced. The association may
state that the estimate may be modified.
(3) The status of the claims for defects in the design or
construction of the common interest development that were not
identified in paragraph (1) whether expressed in a preliminary list
of defects sent to each member of the association or otherwise
claimed and disclosed to the members of the association.
(b) Nothing in this section shall preclude an association from
amending the disclosures required pursuant to subdivision (a), and
any amendments shall supersede any prior conflicting information
disclosed to the members of the association and shall retain any
privilege attached to the original disclosures.
(c) Disclosure of the information required pursuant to subdivision
(a) or authorized by subdivision (b) shall not waive any privilege
attached to the information.
(d) For the purposes of the disclosures required pursuant to this
section, the term "defects" shall be defined to include any damage
resulting from defects.
6215. (a) Not later than 30 days prior to the filing of any civil
action by the association against the declarant or other developer
of a common interest development for alleged damage to the common
areas, alleged damage to the separate interests that the association
is obligated to maintain or repair, or alleged damage to the separate
interests that arises out of, or is integrally related to, damage to
the common areas or separate interests that the association is
obligated to maintain or repair, the board shall deliver individual
notice (Section 4040) to each member of the association who appears
on the records of the association when the notice is provided. The
notice shall specify all of the following:
(1) That a meeting will take place to discuss problems that may
lead to the filing of a civil action.
(2) The options, including civil actions, that are available to
address the problems.
(3) The time and place of this meeting.
(b) Notwithstanding subdivision (a), if the association has reason
to believe that the applicable statute of limitations will expire
before the association files the civil action, the association may
give the notice, as described above, within 30 days after the filing
of the action.
SEC. 41. Section 86 of the Code of Civil Procedure is amended to
read:
86. (a) The following civil cases and proceedings are limited
civil cases:
(1) Cases at law in which the demand, exclusive of interest, or
the value of the property in controversy amounts to twenty-five
thousand dollars ($25,000) or less. This paragraph does not apply to
cases that involve the legality of any tax, impost, assessment, toll,
or municipal fine, except actions to enforce payment of delinquent
unsecured personal property taxes if the legality of the tax is not
contested by the defendant.
(2) Actions for dissolution of partnership where the total assets
of the partnership do not exceed twenty-five thousand dollars
($25,000); actions of interpleader where the amount of money or the
value of the property involved does not exceed twenty-five thousand
dollars ($25,000).
(3) Actions to cancel or rescind a contract when the relief is
sought in connection with an action to recover money not exceeding
twenty-five thousand dollars ($25,000) or property of a value not
exceeding twenty-five thousand dollars ($25,000), paid or delivered
under, or in consideration of, the contract; actions to revise a
contract where the relief is sought in an action upon the contract if
the action otherwise is a limited civil case.
(4) Proceedings in forcible entry or forcible or unlawful detainer
where the whole amount of damages claimed is twenty-five thousand
dollars ($25,000) or less.
(5) Actions to enforce and foreclose liens on personal property
where the amount of the liens is twenty-five thousand dollars
($25,000) or less.
(6) Actions to enforce and foreclose, or petitions to release,
liens of mechanics, materialmen material
providers , artisans, laborers, and of all other persons to
whom liens are given under the provisions of Chapter 2 (commencing
with Section 3109) of Title 15 of Part 4 of Division 3 of the Civil
Code, or to enforce and foreclose an assessment lien on a common
interest development as defined in Section 1351
4100 of the Civil Code, where the amount of the liens is
twenty-five thousand dollars ($25,000) or less. However, where an
action to enforce the lien affects property that is also affected by
a similar pending action that is not a limited civil case, or where
the total amount of the liens sought to be foreclosed against the
same property aggregates an amount in excess of twenty-five thousand
dollars ($25,000), the action is not a limited civil case.
(7) Actions for declaratory relief when brought pursuant to either
of the following:
(A) By way of cross-complaint as to a right of indemnity with
respect to the relief demanded in the complaint or a cross-complaint
in an action or proceeding that is otherwise a limited civil case.
(B) To conduct a trial after a nonbinding fee arbitration between
an attorney and client, pursuant to Article 13 (commencing with
Section 6200) of Chapter 4 of Division 3 of the Business and
Professions Code, where the amount in controversy is twenty-five
thousand dollars ($25,000) or less.
(8) Actions to issue temporary restraining orders and preliminary
injunctions, and to take accounts, where necessary to preserve the
property or rights of any party to a limited civil case; to make any
order or perform any act, pursuant to Title 9 (commencing with
Section 680.010) of Part 2 (enforcement of judgments) in a limited
civil case; to appoint a receiver pursuant to Section 564 in a
limited civil case; to determine title to personal property seized in
a limited civil case.
(9) Actions under Article 3 (commencing with Section 708.210) of
Chapter 6 of Division 2 of Title 9 of Part 2 for the recovery of an
interest in personal property or to enforce the liability of the
debtor of a judgment debtor where the interest claimed adversely is
of a value not exceeding twenty-five thousand dollars ($25,000) or
the debt denied does not exceed twenty-five thousand dollars
($25,000).
(10) Arbitration-related petitions filed pursuant to either of the
following:
(A) Article 2 (commencing with Section 1292) of Chapter 5 of Title
9 of Part 3, except for uninsured motorist arbitration proceedings
in accordance with Section 11580.2 of the Insurance Code, if the
petition is filed before the arbitration award becomes final and the
matter to be resolved by arbitration is a limited civil case under
paragraphs (1) to (9), inclusive, of subdivision (a) or if the
petition is filed after the arbitration award becomes final and the
amount of the award and all other rulings, pronouncements, and
decisions made in the award are within paragraphs (1) to (9),
inclusive, of subdivision (a).
(B) To confirm, correct, or vacate a fee arbitration award between
an attorney and client that is binding or has become binding,
pursuant to Article 13 (commencing with Section 6200) of Chapter 4 of
Division 3 of the Business and Professions Code, where the
arbitration award is twenty-five thousand dollars ($25,000) or less.
(b) The following cases in equity are limited civil cases:
(1) Cases to try title to personal property when the amount
involved is not more than twenty-five thousand dollars ($25,000).
(2) Cases when equity is pleaded as a defensive matter in any case
that is otherwise a limited civil case.
(3) Cases to vacate a judgment or order of the court obtained in a
limited civil case through extrinsic fraud, mistake, inadvertence,
or excusable neglect.
SEC. 42. Section 116.540 of the Code of Civil Procedure is amended
to read:
116.540. (a) Except as permitted by this section, no individual
other than the plaintiff and the defendant may take part in the
conduct or defense of a small claims action.
(b) Except as additionally provided in subdivision (i), a
corporation may appear and participate in a small claims action only
through a regular employee, or a duly appointed or elected officer or
director, who is employed, appointed, or elected for purposes other
than solely representing the corporation in small claims court.
(c) A party who is not a corporation or a natural person may
appear and participate in a small claims action only through a
regular employee, or a duly appointed or elected officer or director,
or in the case of a partnership, a partner, engaged for purposes
other than solely representing the party in small claims court.
(d) If a party is an individual doing business as a sole
proprietorship, the party may appear and participate in a small
claims action by a representative and without personally appearing if
both of the following conditions are met:
(1) The claim can be proved or disputed by evidence of an account
that constitutes a business record as defined in Section 1271 of the
Evidence Code, and there is no other issue of fact in the case.
(2) The representative is a regular employee of the party for
purposes other than solely representing the party in small claims
actions and is qualified to testify to the identity and mode of
preparation of the business record.
(e) A plaintiff is not required to personally appear, and may
submit declarations to serve as evidence supporting his or her claim
or allow another individual to appear and participate on his or her
behalf, if (1) the plaintiff is serving on active duty in the United
States Armed Forces outside this state, (2) the plaintiff was
assigned to his or her duty station after his or her claim arose, (3)
the assignment is for more than six months, (4) the representative
is serving without compensation, and (5) the representative has
appeared in small claims actions on behalf of others no more than
four times during the calendar year. The defendant may file a claim
in the same action in an amount not to exceed the jurisdictional
limits stated in Sections 116.220, 116.221, and 116.231.
(f) A party incarcerated in a county jail, a Department of
Corrections and Rehabilitation facility, or a Division of Juvenile
Facilities facility is not required to personally appear, and may
submit declarations to serve as evidence supporting his or her claim,
or may authorize another individual to appear and participate on his
or her behalf if that individual is serving without compensation and
has appeared in small claims actions on behalf of others no more
than four times during the calendar year.
(g) A defendant who is a nonresident owner of real property may
defend against a claim relating to that property without personally
appearing by (1) submitting written declarations to serve as evidence
supporting his or her defense, (2) allowing another individual to
appear and participate on his or her behalf if that individual is
serving without compensation and has appeared in small claims actions
on behalf of others no more than four times during the calendar
year, or (3) taking the action described in both (1) and (2).
(h) A party who is an owner of rental real property may appear and
participate in a small claims action through a property agent under
contract with the owner to manage the rental of that property, if (1)
the owner has retained the property agent principally to manage the
rental of that property and not principally to represent the owner in
small claims court, and (2) the claim relates to the rental
property.
(i) A party that is an association created to manage a common
interest development, as defined in Section 1351
4100 of the Civil Code, may appear and participate in a
small claims action through an agent, a management company
representative, or bookkeeper who appears on behalf of that
association.
(j) At the hearing of a small claims action, the court shall
require any individual who is appearing as a representative of a
party under subdivisions (b) to (i), inclusive, to file a declaration
stating (1) that the individual is authorized to appear for the
party, and (2) the basis for that authorization. If the
representative is appearing under subdivision (b), (c), (d), (h), or
(i), the declaration also shall state that the individual is not
employed solely to represent the party in small claims court. If the
representative is appearing under subdivision (e), (f), or (g), the
declaration also shall state that the representative is serving
without compensation, and has appeared in small claims actions on
behalf of others no more than four times during the calendar year.
(k) A husband or wife who sues or who is sued with his or her
spouse may appear and participate on behalf of his or her spouse if
(1) the claim is a joint claim, (2) the represented spouse has given
his or her consent, and (3) the court determines that the interests
of justice would be served.
(l) If the court determines that a party cannot properly present
his or her claim or defense and needs assistance, the court may in
its discretion allow another individual to assist that party.
(m) Nothing in this section shall operate or be construed to
authorize an attorney to participate in a small claims action except
as expressly provided in Section 116.530.
SEC. 43. Section 564 of the Code of Civil Procedure is amended to
read:
564. (a) A receiver may be appointed, in the manner provided in
this chapter, by the court in which an action or proceeding is
pending in any case in which the court is empowered by law to appoint
a receiver.
(b) A receiver may be appointed by the court in which an action or
proceeding is pending, or by a judge thereof, in the following
cases:
(1) In an action by a vendor to vacate a fraudulent purchase of
property, or by a creditor to subject any property or fund to the
creditor's claim, or between partners or others jointly owning or
interested in any property or fund, on the application of the
plaintiff, or of any party whose right to or interest in the property
or fund, or the proceeds thereof, is probable, and where it is shown
that the property or fund is in danger of being lost, removed, or
materially injured.
(2) In an action by a secured lender for the foreclosure of a deed
of trust or mortgage and sale of property upon which there is a lien
under a deed of trust or mortgage, where it appears that the
property is in danger of being lost, removed, or materially injured,
or that the condition of the deed of trust or mortgage has not been
performed, and that the property is probably insufficient to
discharge the deed of trust or mortgage debt.
(3) After judgment, to carry the judgment into effect.
(4) After judgment, to dispose of the property according to the
judgment, or to preserve it during the pendency of an appeal, or
pursuant to the Enforcement of Judgments Law (Title 9 (commencing
with Section 680.010)), or after sale of real property pursuant to a
decree of foreclosure, during the redemption period, to collect,
expend, and disburse rents as directed by the court or otherwise
provided by law.
(5) Where a corporation has been dissolved, as provided in Section
565.
(6) Where a corporation is insolvent, or in imminent danger of
insolvency, or has forfeited its corporate rights.
(7) In an action of unlawful detainer.
(8) At the request of the Public Utilities Commission pursuant to
Section 855 or 5259.5 of the Public Utilities Code.
(9) In all other cases where necessary to preserve the property or
rights of any party.
(10) At the request of the Office of Statewide Health Planning and
Development, or the Attorney General, pursuant to Section 129173 of
the Health and Safety Code.
(11) In an action by a secured lender for specific performance of
an assignment of rents provision in a deed of trust, mortgage, or
separate assignment document. The appointment may be continued after
entry of a judgment for specific performance if appropriate to
protect, operate, or maintain real property encumbered by a deed of
trust or mortgage or to collect rents therefrom while a pending
nonjudicial foreclosure under power of sale in a deed of trust or
mortgage is being completed.
(12) In a case brought by an assignee under an assignment of
leases, rents, issues, or profits pursuant to subdivision (g) of
Section 2938 of the Civil Code.
(c) A receiver may be appointed, in the manner provided in this
chapter, including, but not limited to, Section 566, by the superior
court in an action brought by a secured lender to enforce the rights
provided in Section 2929.5 of the Civil Code, to enable the secured
lender to enter and inspect the real property security for the
purpose of determining the existence, location, nature, and magnitude
of any past or present release or threatened release of any
hazardous substance into, onto, beneath, or from the real property
security. The secured lender shall not abuse the right of entry and
inspection or use it to harass the borrower or tenant of the
property. Except in case of an emergency, when the borrower or tenant
of the property has abandoned the premises, or if it is
impracticable to do so, the secured lender shall give the borrower or
tenant of the property reasonable notice of the secured lender's
intent to enter and shall enter only during the borrower's or tenant'
s normal business hours. Twenty-four hours' notice shall be presumed
to be reasonable notice in the absence of evidence to the contrary.
(d) Any action by a secured lender to appoint a receiver pursuant
to this section shall not constitute an action within the meaning of
subdivision (a) of Section 726.
(e) For purposes of this section:
(1) "Borrower" means the trustor under a deed of trust, or a
mortgagor under a mortgage, where the deed of trust or mortgage
encumbers real property security and secures the performance of the
trustor or mortgagor under a loan, extension of credit, guaranty, or
other obligation. The term includes any successor in interest of the
trustor or mortgagor to the real property security before the deed of
trust or mortgage has been discharged, reconveyed, or foreclosed
upon.
(2) "Hazardous substance" means any of the following:
(A) Any "hazardous substance" as defined in subdivision (h) of
Section 25281 of the Health and Safety Code.
(B) Any "waste" as defined in subdivision (d) of Section 13050 of
the Water Code.
(C) Petroleum including crude oil or any fraction thereof, natural
gas, natural gas liquids, liquefied natural gas, or synthetic gas
usable for fuel, or any mixture thereof.
(3) "Real property security" means any real property and
improvements, other than a separate interest and any related interest
in the common area of a residential common interest development, as
the terms "separate interest," "common area," and "common interest
development" are defined in Section 1351
Sections 4185, 4095, and 4100 of the Civil Code, or real
property consisting of one acre or less that contains 1 to 15
dwelling units.
(4) "Release" means any spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, leaching,
dumping, or disposing into the environment, including continuing
migration, of hazardous substances into, onto, or through soil,
surface water, or groundwater.
(5) "Secured lender" means the beneficiary under a deed of
trust against the real property security, or the mortgagee under a
mortgage against the real property security, and any successor in
interest of the beneficiary or mortgagee to the deed of trust or
mortgage.
SEC. 44. Section 726.5 of the Code of Civil Procedure is amended
to read:
726.5. (a) Notwithstanding subdivision (a) of Section 726 or any
other provision of law, except subdivision (d) of this section, a
secured lender may elect between the following where the real
property security is environmentally impaired and the borrower's
obligations to the secured lender are in default:
(1) (A) Waiver of its lien against (i) any parcel of real property
security that is environmentally impaired or is an affected parcel,
and (ii) all or any portion of the fixtures and personal property
attached to the parcels; and
(B) Exercise of (i) the rights and remedies of an unsecured
creditor, including reduction of its claim against the borrower to
judgment, and (ii) any other rights and remedies permitted by law.
(2) Exercise of (i) the rights and remedies of a creditor secured
by a deed of trust or mortgage and, if applicable, a lien against
fixtures or personal property attached to the real property security,
and (ii) any other rights and remedies permitted by law.
(b) Before the secured lender may waive its lien against any
parcel of real property security pursuant to paragraph (1) of
subdivision (a) on the basis of the environmental impairment
contemplated by paragraph (3) of subdivision (e), (i) the secured
lender shall provide written notice of the default to the borrower,
and (ii) the value of the subject real property security shall be
established and its environmentally impaired status shall be
confirmed by an order of a court of competent jurisdiction in an
action brought by the secured lender against the borrower. The
complaint for a valuation and confirmation action may include causes
of action for a money judgment for all or part of the secured
obligation, in which case the waiver of the secured lender's liens
under paragraph (1) of subdivision (a) shall result only if and when
a final money judgment is obtained against the borrower.
(c) If a secured lender elects the rights and remedies permitted
by paragraph (1) of subdivision (a) and the borrower's obligations
are also secured by other real property security, fixtures, or
personal property, the secured lender shall first foreclose against
the additional collateral to the extent required by applicable law in
which case the amount of the judgment of the secured lender pursuant
to paragraph (1) of subdivision (a) shall be limited to the extent
Section 580a or 580d, or subdivision (b) of Section 726 apply to the
foreclosures of additional real property security. The borrower may
waive or modify the foreclosure requirements of this subdivision
provided that the waiver or modification is in writing and signed by
the borrower after default.
(d) Subdivision (a) shall be inapplicable if all of the following
are true:
(1) The release or threatened release was not knowingly or
negligently caused or contributed to, or knowingly or willfully
permitted or acquiesced to, by any of the following:
(A) The borrower or any related party.
(B) Any affiliate or agent of the borrower or any related party.
(2) In conjunction with the making, renewal, or modification of
the loan, extension of credit, guaranty, or other obligation secured
by the real property security, neither the borrower, any related
party, nor any affiliate or agent of either the borrower or any
related party had actual knowledge or notice of the release or
threatened release, or if a person had knowledge or notice of the
release or threatened release, the borrower made written disclosure
thereof to the secured lender after the secured lender's written
request for information concerning the environmental condition of the
real property security, or the secured lender otherwise obtained
actual knowledge thereof, prior to the making, renewal, or
modification of the obligation.
(e) For purposes of this section:
(1) "Affected parcel" means any portion of a parcel of real
property security that is (A) contiguous to the environmentally
impaired parcel, even if separated by roads, streets, utility
easements, or railroad rights-of-way, (B) part of an approved or
proposed subdivision within the meaning of Section 66424 of the
Government Code, of which the environmentally impaired parcel is also
a part, or (C) within 2,000 feet of the environmentally impaired
parcel.
(2) "Borrower" means the trustor under a deed of trust, or a
mortgagor under a mortgage, where the deed of trust or mortgage
encumbers real property security and secures the performance of the
trustor or mortgagor under a loan, extension of credit, guaranty, or
other obligation. The term includes any successor-in-interest of the
trustor or mortgagor to the real property security before the deed of
trust or mortgage has been discharged, reconveyed, or foreclosed
upon.
(3) "Environmentally impaired" means that the estimated costs to
clean up and remediate a past or present release or threatened
release of any hazardous substance into, onto, beneath, or from the
real property security, not disclosed in writing to, or otherwise
actually known by, the secured lender prior to the making of the loan
or extension of credit secured by the real property security,
exceeds 25 percent of the higher of the aggregate fair market value
of all security for the loan or extension of credit (A) at the time
of the making of the loan or extension of credit, or (B) at the time
of the discovery of the release or threatened release by the secured
lender. For the purposes of this definition, the estimated cost to
clean up and remediate the contamination caused by the release or
threatened release shall include only those costs that would be
incurred reasonably and in good faith, and fair market value shall be
determined without giving consideration to the release or threatened
release, and shall be exclusive of the amount of all liens and
encumbrances against the security that are senior in priority to the
lien of the secured lender. Notwithstanding the foregoing, the real
property security for any loan or extension of credit secured by a
single parcel of real property which is included in the National
Priorities List pursuant to Section 9605 of Title 42 of the United
States Code, or in any list published by the Department of Toxic
Substances Control pursuant to subdivision (b) of Section 25356 of
the Health and Safety Code, shall be deemed to be environmentally
impaired.
(4) "Hazardous substance" means any of the following:
(A) Any "hazardous substance" as defined in subdivision (h) of
Section 25281 of the Health and Safety Code.
(B) Any "waste" as defined in subdivision (d) of Section 13050 of
the Water Code.
(C) Petroleum, including crude oil or any fraction thereof,
natural gas, natural gas liquids, liquefied natural gas, or synthetic
gas usable for fuel, or any mixture thereof.
(5) "Real property security" means any real property and
improvements, other than a separate interest and any related interest
in the common area of a residential common interest development, as
the terms "separate interest," "common area," and "common interest
development" are defined in Section 1351
Sections 4185, 4095, and 4100 of the Civil Code, or real
property which that contains only 1 to
15 dwelling units, which in either case (A) is solely used (i) for
residential purposes, or (ii) if reasonably contemplated by the
parties to the deed of trust or mortgage, for residential purposes as
well as limited agricultural or commercial purposes incidental
thereto, and (B) is the subject of an issued certificate of occupancy
unless the dwelling is to be owned and occupied by the borrower.
(6) "Related party" means any person who shares an ownership
interest with the borrower in the real property security, or is a
partner or joint venturer with the borrower in a partnership or joint
venture, the business of which includes the acquisition,
development, use, lease, or sale of the real property security.
(7) "Release" means any spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, leaching,
dumping, or disposing into the environment, including continuing
migration, of hazardous substances into, onto, or through soil,
surface water, or groundwater. The term does not include actions
directly relating to the incorporation in a lawful manner of building
materials into a permanent improvement to the real property
security.
(8) "Secured lender" means the beneficiary under a deed of trust
against the real property security, or the mortgagee under a mortgage
against the real property security, and any successor-in-interest of
the beneficiary or mortgagee to the deed of trust or mortgage.
(f) This section shall not be construed to invalidate or otherwise
affect in any manner any rights or obligations arising under
contract in connection with a loan or extension of credit, including,
without limitation, provisions limiting recourse.
(g) This section shall only apply to loans, extensions of credit,
guaranties, or other obligations secured by real property security
made, renewed, or modified on or after January 1, 1992.
SEC. 45. Section 729.035 of the Code of Civil Procedure is amended
to read:
729.035. Notwithstanding any provision of law to the contrary,
the sale of a separate interest in a common interest development is
subject to the right of redemption within 90 days after the sale if
the sale arises from a foreclosure by the association of a common
interest development pursuant to subdivision (g) of Section
1367.1 Section 5645 of the Civil Code, subject
to the conditions of Section 1367.4 Sections
5625, 5650, 5655, and 5660 of the Civil Code.
SEC. 46. Section 736 of the Code of Civil Procedure is amended to
read:
736. (a) Notwithstanding any other provision of law, a secured
lender may bring an action for breach of contract against a borrower
for breach of any environmental provision made by the borrower
relating to the real property security, for the recovery of damages,
and for the enforcement of the environmental provision, and that
action or failure to foreclose first against collateral shall not
constitute an action within the meaning of subdivision (a) of Section
726, or constitute a money judgment for a deficiency or a deficiency
judgment within the meaning of Section 580a, 580b, or 580d, or
subdivision (b) of Section 726. No injunction for the enforcement of
an environmental provision may be issued after (1) the obligation
secured by the real property security has been fully satisfied, or
(2) all of the borrower's rights, title, and interest in and to the
real property security has been transferred in a bona fide
transaction to an unaffiliated third party for fair value.
(b) The damages a secured lender may recover pursuant to
subdivision (a) shall be limited to reimbursement or indemnification
of the following:
(1) If not pursuant to an order of any federal, state, or local
governmental agency relating to the cleanup, remediation, or other
response action required by applicable law, those costs relating to a
reasonable and good faith cleanup, remediation, or other response
action concerning a release or threatened release of hazardous
substances which that is anticipated by
the environmental provision.
(2) If pursuant to an order of any federal, state, or local
governmental agency relating to the cleanup, remediation, or other
response action required by applicable law which
that is anticipated by the environmental provision, all
amounts reasonably advanced in good faith by the secured lender in
connection therewith, provided that the secured lender negotiated, or
attempted to negotiate, in good faith to minimize the amounts it was
required to advance under the order.
(3) Indemnification against all liabilities of the secured lender
to any third party relating to the breach and not arising from acts,
omissions, or other conduct which that
occur after the borrower is no longer an owner or operator of the
real property security, and provided the secured lender is not
responsible for the environmentally impaired condition of the real
property security in accordance with the standards set forth in
subdivision (d) of Section 726.5. For purposes of this paragraph, the
term "owner or operator" means those persons described in Section
101(20)(A) of the Comprehensive Environmental Response, Compensation,
and Liability Act of 1980, as amended (42 U.S.C. Sec. 9601, et
seq.).
(4) Attorneys' fees and costs incurred by the secured lender
relating to the breach.
The damages a secured lender may recover pursuant to subdivision
(a) shall not include (i) any part of the principal amount or accrued
interest of the secured obligation, except for any amounts advanced
by the secured lender to cure or mitigate the breach of the
environmental provision that are added to the principal amount, and
contractual interest thereon, or (ii) amounts which
that relate to a release which was knowingly
permitted, caused, or contributed to by the secured lender or any
affiliate or agent of the secured lender.
(c) A secured lender may not recover damages against a borrower
pursuant to subdivision (a) for amounts advanced or obligations
incurred for the cleanup or other remediation of real property
security, and related attorneys' fees and costs, if all of the
following are true:
(1) The original principal amount of, or commitment for, the loan
or other obligation secured by the real property security did not
exceed two hundred thousand dollars ($200,000).
(2) In conjunction with the secured lender's acceptance of the
environmental provision, the secured lender agreed in writing to
accept the real property security on the basis of a completed
environmental site assessment and other relevant information from the
borrower.
(3) The borrower did not permit, cause, or contribute to the
release or threatened release.
(4) The deed of trust or mortgage covering the real property
security has not been discharged, reconveyed, or foreclosed upon.
(d) This section is not intended to establish, abrogate, modify,
limit, or otherwise affect any cause of action other than that
provided by subdivision (a) that a secured lender may have against a
borrower under an environmental provision.
(e) This section shall apply only to environmental provisions
contracted in conjunction with loans, extensions of credit,
guaranties, or other obligations made, renewed, or modified on or
after January 1, 1992. Notwithstanding the foregoing, this section
shall not be construed to validate, invalidate, or otherwise affect
in any manner the rights and obligations of the parties to, or the
enforcement of, environmental provisions contracted before January 1,
1992.
(f) For purposes of this section:
(1) "Borrower" means the trustor under a deed of trust, or a
mortgagor under a mortgage, where the deed of trust or mortgage
encumbers real property security and secures the performance of the
trustor or mortgagor under a loan, extension of credit, guaranty, or
other obligation. The term includes any successor-in-interest of the
trustor or mortgagor to the real property security before the deed of
trust or mortgage has been discharged, reconveyed, or foreclosed
upon.
(2) "Environmental provision" means any written representation,
warranty, indemnity, promise, or covenant relating to the existence,
location, nature, use, generation, manufacture, storage, disposal,
handling, or past, present, or future release or threatened release,
of any hazardous substance into, onto, beneath, or from the real
property security, or to past, present, or future compliance with any
law relating thereto, made by a borrower in conjunction with the
making, renewal, or modification of a loan, extension of credit,
guaranty, or other obligation involving the borrower, whether or not
the representation, warranty, indemnity, promise, or covenant is or
was contained in or secured by the deed of trust or mortgage, and
whether or not the deed of trust or mortgage has been discharged,
reconveyed, or foreclosed upon.
(3) "Hazardous substance" means any of the following:
(A) Any "hazardous substance" as defined in subdivision (h) of
Section 25281 of the Health and Safety Code.
(B) Any "waste" as defined in subdivision (d) of Section 13050 of
the Water Code.
(C) Petroleum, including crude oil or any fraction thereof,
natural gas, natural gas liquids, liquefied natural gas, or synthetic
gas usable for fuel, or any mixture thereof.
(4) "Real property security" means any real property and
improvements, other than a separate interest and any related interest
in the common area of a residential common interest development, as
the terms "separate interest," "common area," and "common interest
development" are defined in Section 1351
Sections 4185, 4095, and 4100 of the Civil Code, or real
property which that contains only 1 to
15 dwelling units, which in either case (A) is solely used (i) for
residential purposes, or (ii) if reasonably contemplated by the
parties to the deed of trust or mortgage, for residential purposes as
well as limited agricultural or commercial purposes incidental
thereto, and (B) is the subject of an issued certificate of occupancy
unless the dwelling is to be owned and occupied by the borrower.
(5) "Release" means any spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, leaching,
dumping, or disposing into the environment, including continuing
migration, of hazardous substances into, onto, or through soil,
surface water, or groundwater. The term does not include actions
directly relating to the incorporation in a lawful manner of building
materials into a permanent improvement to the real property
security.
(6) "Secured lender" means the beneficiary under a deed of trust
against the real property security, or the mortgagee under a mortgage
against the real property security, and any successor-in-interest of
the beneficiary or mortgagee to the deed of trust or mortgage.
SEC. 47. Section 12191 of the Government Code is amended to read:
12191. The miscellaneous business entity filing fees are the
following:
(a) Foreign Associations, as defined in Sections 170 and 171 of
the Corporations Code:
(1) Filing the statement and designation upon the qualification of
a foreign association pursuant to Section 2105 of the Corporations
Code: One hundred dollars ($100).
(2) Filing an amended statement and designation by a foreign
association pursuant to Section 2107 of the Corporations Code: Thirty
dollars ($30).
(3) Filing a certificate showing the surrender of the right of a
foreign association to transact intrastate business pursuant to
Section 2112 of the Corporations Code: No fee.
(b) Unincorporated Associations:
(1) Filing a statement in accordance with Section 24003 of the
Corporations Code as to principal place of office or place for
sending notices or designating agent for service: Twenty-five dollars
($25).
(2) Insignia Registrations: Ten dollars ($10).
(c) Community Associations and Common Interest Developments:
(1) Filing a statement by a community association in accordance
with Section 1363.6 4960 of the Civil
Code to register the common interest development that it manages: An
amount not to exceed thirty dollars ($30).
(2) Filing an amended statement by a community association in
accordance with Section 1363.6 4960 of
the Civil Code: No fee.
SEC. 48. Section 12956.1 of the Government Code is amended to
read:
12956.1. (a) As used in this section, "association," "governing
documents," and "declaration" have the same meanings as set forth in
Section 1351 Sections 4080, 4150, and 4135
of the Civil Code.
(b) (1) A county recorder, title insurance company, escrow
company, real estate broker, real estate agent, or association that
provides a copy of a declaration, governing document, or deed to any
person shall place a cover page or stamp on the first page of the
previously recorded document or documents stating, in at least
14-point boldface type, the following:
"If this document contains any restriction based on race, color,
religion, sex, sexual orientation, familial status, marital status,
disability, national origin, source of income as defined in
subdivision (p) of Section 12955, or ancestry, that restriction
violates state and federal fair housing laws and is void, and may be
removed pursuant to Section 12956.2 of the Government Code. Lawful
restrictions under state and federal law on the age of occupants in
senior housing or housing for older persons shall not be construed as
restrictions based on familial status."
(2) The requirements set forth in paragraph (1) shall not apply to
documents being submitted for recordation to a county recorder.
(c) Any person who records a document for the express purpose of
adding a racially restrictive covenant is guilty of a misdemeanor.
The county recorder shall not incur any liability for recording the
document. Notwithstanding any other provision of law, a prosecution
for a violation of this subdivision shall commence within three years
after the discovery of the recording of the document.
SEC. 49. Section 12956.2 of the Government Code is amended to
read:
12956.2. (a) A person who holds an ownership interest of record
in property that he or she believes is the subject of an unlawfully
restrictive covenant in violation of subdivision (l) of Section 12955
may record a document titled Restrictive Covenant Modification. The
county recorder may choose to waive the fee prescribed for recording
and indexing instruments pursuant to Section 27361 in the case of the
modification document provided for in this section. The modification
document shall include a complete copy of the original document
containing the unlawfully restrictive language with the unlawfully
restrictive language stricken.
(b) Before recording the modification document, the county
recorder shall submit the modification document and the original
document to the county counsel who shall determine whether the
original document contains an unlawful restriction based on race,
color, religion, sex, sexual orientation, familial status, marital
status, disability, national origin, source of income as defined in
subdivision (p) of Section 12955, or ancestry. The county counsel
shall return the documents and inform the county recorder of its
determination. The county recorder shall refuse to record the
modification document if the county counsel finds that the original
document does not contain an unlawful restriction as specified in
this paragraph.
(c) The modification document shall be indexed in the same manner
as the original document being modified. It shall contain a recording
reference to the original document in the form of a book and page or
instrument number, and date of the recording.
(d) Subject to covenants, conditions, and restrictions that were
recorded after the recording of the original document that contains
the unlawfully restrictive language and subject to covenants,
conditions, and restrictions that will be recorded after the
Restrictive Covenant Modification, the restrictions in the
Restrictive Covenant Modification, once recorded, are the only
restrictions having effect on the property. The effective date of the
terms and conditions of the modification document shall be the same
as the effective date of the original document.
(e) The county recorder shall make available to the public
Restrictive Covenant Modification forms.
(f) If the holder of an ownership interest of record in property
causes to be recorded a modified document pursuant to this section
that contains modifications not authorized by this section, the
county recorder shall not incur liability for recording the document.
The liability that may result from the unauthorized recordation is
the sole responsibility of the holder of the ownership interest of
record who caused the modified recordation.
(g) This section does not apply to persons holding an ownership
interest in property that is part of a common interest development as
defined in subdivision (c) of Section 1351
Section 4100 of the Civil Code if the board of directors of
that common interest development is subject to the requirements of
subdivision (b) of Section 1352.5 Section
6150 of the Civil Code.
SEC. 50. Section 53341.5 of the Government Code is amended to
read:
53341.5. (a) If a lot, parcel, or unit of a subdivision is
subject to a special tax levied pursuant to this chapter, the
subdivider, his or her agent, or representative, shall not sell, or
lease for a term exceeding five years, or permit a prospective
purchaser or lessor to sign a contract of purchase or a deposit
receipt or any substantially equivalent document in the event of a
lease with respect to the lot, parcel, or unit, or cause it to be
sold or leased for a term exceeding five years, until the prospective
purchaser or lessee of the lot, parcel, or unit has been furnished
with and has signed a written notice as provided in this section. The
notice shall contain the heading "NOTICE OF SPECIAL TAX" in type no
smaller than 8-point type, and shall be in substantially the
following form. The form may be modified as needed to clearly and
accurately describe the tax structure and other characteristics of
districts created before January 1, 1993, or to clearly and
accurately consolidate information about the tax structure and other
characteristics of two or more districts that levy or are authorized
to levy special taxes with respect to the lot, parcel, or unit:
NOTICE OF SPECIAL TAX
COMMUNITY FACILITIES DISTRICT NO. ___
COUNTY OF ____, CALIFORNIA
TO: THE PROSPECTIVE PURCHASER OF THE
REAL PROPERTY KNOWN AS:
__________________________________________________
__________________________________________________
THIS IS A NOTIFICATION TO YOU PRIOR TO YOUR ENTERING INTO A CONTRACT
TO PURCHASE THIS PROPERTY. THE SELLER IS REQUIRED TO GIVE YOU THIS
NOTICE AND TO OBTAIN A COPY SIGNED BY YOU TO INDICATE THAT YOU HAVE
RECEIVED AND READ A COPY OF THIS NOTICE.
(1) This property is subject to a special tax, that is in addition
to the regular property taxes and any other charges, fees, special
taxes, and benefit assessments on the parcel. It is imposed on
this property because it is
a new development, and is not necessarily imposed generally upon
property outside of this new development. If you fail to pay this tax
when due each year, the property may be foreclosed upon and sold.
The tax is used to provide public facilities or services that are
likely to particularly benefit the property. YOU SHOULD TAKE THIS TAX
AND THE BENEFITS FROM THE FACILITIES AND SERVICES FOR WHICH IT PAYS
INTO ACCOUNT IN DECIDING WHETHER TO BUY THIS PROPERTY.
(2) The maximum special tax that may be levied against this parcel
to pay for public facilities is $______ during the ____-__ tax year.
This amount will increase by __ percent per year after that (if
applicable). The special tax will be levied each year until all of
the authorized facilities are built and all special tax bonds are
repaid, but in any case not after the ____-__ tax year. An additional
special tax will be used to pay for ongoing service costs, if
applicable. The maximum amount of this tax is ____ dollars ($____)
during the ____-__ tax year. This amount may increase by ____, if
applicable, and that part may be levied until the ____-__ tax year
(or forever, as applicable).
(3) The authorized facilities that are being paid for by the
special taxes, and by the money received from the sale of bonds that
are being repaid by the special taxes, are:
These facilities may not yet have all been constructed or acquired
and it is possible that some may never be constructed or acquired.
In addition, the special taxes may be used to pay for costs of the
following services:
YOU MAY OBTAIN A COPY OF THE RESOLUTION OF FORMATION THAT
AUTHORIZED CREATION OF THE COMMUNITY FACILITIES DISTRICT, AND THAT
SPECIFIES MORE PRECISELY HOW THE SPECIAL TAX IS APPORTIONED AND HOW
THE PROCEEDS OF THE TAX WILL BE USED, FROM THE ____ (name of
jurisdiction) BY CALLING ____ (telephone number). THERE MAY BE A
CHARGE FOR THIS DOCUMENT NOT TO EXCEED THE REASONABLE COST OF
PROVIDING THE DOCUMENT.
I (WE) ACKNOWLEDGE THAT I (WE) HAVE READ THIS NOTICE AND RECEIVED A
COPY OF THIS NOTICE PRIOR TO ENTERING INTO A CONTRACT TO PURCHASE OR
SIGNING A DEPOSIT RECEIPT WITH RESPECT TO THE ABOVE-REFERENCED
PROPERTY. I (WE) UNDERSTAND THAT I (WE) MAY TERMINATE THE CONTRACT TO
PURCHASE OR DEPOSIT RECEIPT WITHIN THREE DAYS AFTER RECEIVING THIS
NOTICE IN PERSON OR WITHIN FIVE DAYS AFTER IT WAS DEPOSITED IN THE
MAIL BY GIVING WRITTEN NOTICE OF THAT TERMINATION TO THE OWNER,
SUBDIVIDER, OR AGENT SELLING THE PROPERTY.
DATE: _______________________
________________________ ____
________________________ _______________________
____
________________________ _______________________
____
(b) "Subdivision," as used in subdivision (a), means improved or
unimproved land that is divided or proposed to be divided for the
purpose of sale, lease, or financing, whether immediate or future,
into two or more lots, parcels, or units and includes a condominium
project, as defined by Section 1350 4125
of the Civil Code, a community apartment project, a stock
cooperative, and a limited-equity housing cooperative, as defined in
Sections 11004, 11003.2, and 11003.4, respectively, of the Business
and Professions Code.
(c) The buyer shall have three days after delivery in person or
five days after delivery by deposit in the mail of any notice
required by this section, to terminate his or her agreement by
delivery of written notice of that termination to the owner,
subdivider, or agent.
(d) The failure to furnish the notice to the buyer or lessee, and
failure of the buyer or lessee to sign the notice of a special tax,
shall not invalidate any grant, conveyance, lease, or encumbrance.
(e) Any person or entity who willfully violates the provisions of
this section shall be liable to the purchaser of a lot or unit that
is subject to the provisions of this section, for actual damages, and
in addition thereto, shall be guilty of a public offense punishable
by a fine in an amount not to exceed five hundred dollars ($500). In
an action to enforce a liability or fine, the prevailing party shall
be awarded reasonable attorney's fees.
SEC. 51. Section 65008 of the Government Code is amended to read:
65008. (a) Any action pursuant to this title by any city, county,
city and county, or other local governmental agency in this state is
null and void if it denies to any individual or group of individuals
the enjoyment of residence, landownership, tenancy, or any other
land use in this state because of any of the following reasons:
(1) (A) The lawful occupation, age, or any characteristic of the
individual or group of individuals listed in subdivision (a) or (d)
of Section 12955, as those bases are defined in Sections 12926,
12926.1, subdivision (m) and paragraph (1) of subdivision (p) of
Section 12955 and Section 12955.2.
(B) Notwithstanding subparagraph (A), with respect to familial
status, subparagraph (A) shall not be construed to apply to housing
for older persons, as defined in Section 12955.9. With respect to
familial status, nothing in subparagraph (A) shall be construed to
affect Sections 51.2, 51.3, 51.4, 51.10, 51.11, and 799.5 of the
Civil Code, relating to housing for senior citizens. Subdivision (d)
of Section 51 and Section 1360 5760 of
the Civil Code and subdivisions (n), (o), and (p) of Section 12955 of
this code shall apply to subparagraph (A).
(2) The method of financing of any residential development of the
individual or group of individuals.
(3) The intended occupancy of any residential development by
persons or families of very low, low, moderate, or middle income.
(b) (1) No city, county, city and county, or other local
governmental agency shall, in the enactment or administration of
ordinances pursuant to any law, including this title, prohibit or
discriminate against any residential development or emergency shelter
for any of the following reasons:
(A) Because of the method of financing.
(B) (i) Because of the lawful occupation, age, or any
characteristic listed in subdivision (a) or (d) of Section 12955, as
those characteristics are defined in Sections 12926, 12926.1,
subdivision (m) and paragraph (1) of subdivision (p) of Section
12955, and Section 12955.2 of the owners or intended occupants of the
residential development or emergency shelter.
(ii) Notwithstanding clause (i), with respect to familial status,
clause (i) shall not be construed to apply to housing for older
persons, as defined in Section 12955.9. With respect to familial
status, nothing in clause (i) shall be construed to affect Sections
51.2, 51.3, 51.4, 51.10, 51.11, and 799.5 of the Civil Code, relating
to housing for senior citizens. Subdivision (d) of Section 51 and
Section 1360 5760 of the Civil Code and
subdivisions (n), (o), and (p) of Section 12955 of this code shall
apply to clause (i).
(C) Because the development or shelter is intended for occupancy
by persons and families of very low, low, or moderate income, as
defined in Section 50093 of the Health and Safety Code, or persons
and families of middle income.
(D) Because the development consists of a multifamily residential
project that is consistent with both the jurisdiction's zoning
ordinance and general plan as they existed on the date the
application was deemed complete, except that a project shall not be
deemed to be inconsistent with the zoning designation for the site if
that zoning designation is inconsistent with the general plan only
because the project site has not been rezoned to conform with a more
recently adopted general plan.
(2) The discrimination prohibited by this subdivision includes the
denial or conditioning of a residential development or shelter
because of, in whole or in part, either of the following:
(A) The method of financing.
(B) The occupancy of the development by persons protected by this
subdivision, including, but not limited to, persons and families of
very low, low, or moderate income.
(3) A city, county, city and county, or other local government
agency may not, pursuant to subdivision (d) of Section 65589.5,
disapprove a housing development project or condition approval of a
housing development project in a manner that renders the project
infeasible if the basis for the disapproval or conditional approval
includes any of the reasons prohibited in paragraph (1) or (2).
(c) For the purposes of this section, "persons and families of
middle income" means persons and families whose income does not
exceed 150 percent of the median income for the county in which the
persons or families reside.
(d) (1) No city, county, city and county, or other local
governmental agency may impose different requirements on a
residential development or emergency shelter that is subsidized,
financed, insured, or otherwise assisted by the federal or state
government or by a local public entity, as defined in Section 50079
of the Health and Safety Code, than those imposed on nonassisted
developments, except as provided in subdivision (e). The
discrimination prohibited by this subdivision includes the denial or
conditioning of a residential development or emergency shelter based
in whole or in part on the fact that the development is subsidized,
financed, insured, or otherwise assisted as described in this
paragraph.
(2) (A) No city, county, city and county, or other local
governmental agency may, because of the lawful occupation age, or any
characteristic of the intended occupants listed in subdivision (a)
or (d) of Section 12955, as those characteristics are defined in
Sections 12926, 12926.1, subdivision (m) and paragraph (1) of
subdivision (p) of Section 12955, and Section 12955.2 or because the
development is intended for occupancy by persons and families of very
low, low, moderate, or middle income, impose different requirements
on these residential developments than those imposed on developments
generally, except as provided in subdivision (e).
(B) Notwithstanding subparagraph (A), with respect to familial
status, subparagraph (A) shall not be construed to apply to housing
for older persons, as defined in Section 12955.9. With respect to
familial status, nothing in subparagraph (A) shall be construed to
affect Sections 51.2, 51.3, 51.4, 51.10, 51.11, and 799.5 of the
Civil Code, relating to housing for senior citizens. Subdivision (d)
of Section 51 and Section 1360 5760 of
the Civil Code and subdivisions (n), (o), and (p) of Section 12955 of
this code shall apply to subparagraph (A).
(e) Notwithstanding subdivisions (a) to (d), inclusive, this
section and this title do not prohibit either of the following:
(1) The County of Riverside from enacting and enforcing zoning to
provide housing for older persons, in accordance with state or
federal law, if that zoning was enacted prior to January 1, 1995.
(2) Any city, county, or city and county from extending
preferential treatment to residential developments or emergency
shelters assisted by the federal or state government or by a local
public entity, as defined in Section 50079 of the Health and Safety
Code, or other residential developments or emergency shelters
intended for occupancy by persons and families of low and moderate
income, as defined in Section 50093 of the Health and Safety Code, or
persons and families of middle income, or agricultural employees, as
defined in subdivision (b) of Section 1140.4 of the Labor Code, and
their families. This preferential treatment may include, but need not
be limited to, reduction or waiver of fees or changes in
architectural requirements, site development and property line
requirements, building setback requirements, or vehicle parking
requirements that reduce development costs of these developments.
(f) "Residential development," as used in this section, means a
single-family residence or a multifamily residence, including
manufactured homes, as defined in Section 18007 of the Health and
Safety Code.
(g) This section shall apply to chartered cities.
(h) The Legislature finds and declares that discriminatory
practices that inhibit the development of housing for persons and
families of very low, low, moderate, and middle income, or emergency
shelters for the homeless, are a matter of statewide concern.
SEC. 52. Section 65915 of the Government Code is amended to read:
65915. (a) When an applicant seeks a density bonus for a housing
development within, or for the donation of land for housing within,
the jurisdiction of a city, county, or city and county, that local
government shall provide the applicant incentives or concessions for
the production of housing units and child care facilities as
prescribed in this section. All cities, counties, or cities and
counties shall adopt an ordinance that specifies how compliance with
this section will be implemented.
(b) (1) A city, county, or city and county shall grant one density
bonus, the amount of which shall be as specified in subdivision (g),
and incentives or concessions, as described in subdivision (d), when
an applicant for a housing development seeks and agrees to construct
a housing development, excluding any units permitted by the density
bonus awarded pursuant to this section, that will contain at least
any one of the following:
(A) Ten percent of the total units of a housing development for
lower income households, as defined in Section 50079.5 of the Health
and Safety Code.
(B) Five percent of the total units of a housing development for
very low income households, as defined in Section 50105 of the Health
and Safety Code.
(C) A senior citizen housing development as defined in Sections
51.3 and 51.12 of the Civil Code, or mobilehome park that limits
residency based on age requirements for housing for older persons
pursuant to Section 798.76 or 799.5 of the Civil Code.
(D) Ten percent of the total dwelling units in a common interest
development as defined in Section 1351 4100
of the Civil Code for persons and families of moderate income,
as defined in Section 50093 of the Health and Safety Code, provided
that all units in the development are offered to the public for
purchase.
(2) For purposes of calculating the amount of the density bonus
pursuant to subdivision (f), the applicant who requests a density
bonus pursuant to this subdivision shall elect whether the bonus
shall be awarded on the basis of subparagraph (A), (B), (C), or (D)
of paragraph (1).
(c) (1) An applicant shall agree to, and the city, county, or city
and county shall ensure, continued affordability of all low-and very
low income units that qualified the applicant for the award of the
density bonus for 30 years or a longer period of time if required by
the construction or mortgage financing assistance program, mortgage
insurance program, or rental subsidy program. Rents for the lower
income density bonus units shall be set at an affordable rent as
defined in Section 50053 of the Health and Safety Code.
Owner-occupied units shall be available at an affordable housing cost
as defined in Section 50052.5 of the Health and Safety Code.
(2) An applicant shall agree to, and the city, county, or city and
county shall ensure that, the initial occupant of the
moderate-income units that are directly related to the receipt of the
density bonus in the common interest development, as defined in
Section 1351 4100 of the Civil Code,
are persons and families of moderate income, as defined in Section
50093 of the Health and Safety Code, and that the units are offered
at an affordable housing cost, as that cost is defined in Section
50052.5 of the Health and Safety Code. The local government shall
enforce an equity-sharing agreement, unless it is in conflict with
the requirements of another public funding source or law. The
following apply to the equity-sharing agreement:
(A) Upon resale, the seller of the unit shall retain the value of
any improvements, the downpayment, and the seller's proportionate
share of appreciation. The local government shall recapture any
initial subsidy and its proportionate share of appreciation, which
shall then be used within three years for any of the purposes
described in subdivision (e) of Section 33334.2 of the Health and
Safety Code that promote homeownership.
(B) For purposes of this subdivision, the local government's
initial subsidy shall be equal to the fair market value of the home
at the time of initial sale minus the initial sale price to the
moderate-income household, plus the amount of any downpayment
assistance or mortgage assistance. If upon resale the market value is
lower than the initial market value, then the value at the time of
the resale shall be used as the initial market value.
(C) For purposes of this subdivision, the local government's
proportionate share of appreciation shall be equal to the ratio of
the initial subsidy to the fair market value of the home at the time
of initial sale.
(d) (1) An applicant for a density bonus pursuant to subdivision
(b) may submit to a city, county, or city and county a proposal for
the specific incentives or concessions that the applicant requests
pursuant to this section, and may request a meeting with the city,
county, or city and county. The city, county, or city and county
shall grant the concession or incentive requested by the applicant
unless the city, county, or city and county makes a written finding,
based upon substantial evidence, of either of the following:
(A) The concession or incentive is not required in order to
provide for affordable housing costs, as defined in Section 50052.5
of the Health and Safety Code, or for rents for the targeted units to
be set as specified in subdivision (c).
(B) The concession or incentive would have a specific adverse
impact, as defined in paragraph (2) of subdivision (d) of Section
65589.5, upon public health and safety or the physical environment or
on any real property that is listed in the California Register of
Historical Resources and for which there is no feasible method to
satisfactorily mitigate or avoid the specific adverse impact without
rendering the development unaffordable to low- and moderate-income
households.
(2) The applicant shall receive the following number of incentives
or concessions:
(A) One incentive or concession for projects that include at least
10 percent of the total units for lower income households, at least
5 percent for very low income households, or at least 10 percent for
persons and families of moderate income in a common interest
development.
(B) Two incentives or concessions for projects that include at
least 20 percent of the total units for lower income households, at
least 10 percent for very low income households, or at least 20
percent for persons and families of moderate income in a common
interest development.
(C) Three incentives or concessions for projects that include at
least 30 percent of the total units for lower income households, at
least 15 percent for very low income households, or at least 30
percent for persons and families of moderate income in a common
interest development.
(3) The applicant may initiate judicial proceedings if the city,
county, or city and county refuses to grant a requested density
bonus, incentive, or concession. If a court finds that the refusal to
grant a requested density bonus, incentive, or concession is in
violation of this section, the court shall award the plaintiff
reasonable attorney's fees and costs of suit. Nothing in this
subdivision shall be interpreted to require a local government to
grant an incentive or concession that has a specific, adverse impact,
as defined in paragraph (2) of subdivision (d) of Section 65589.5,
upon health, safety, or the physical environment, and for which there
is no feasible method to satisfactorily mitigate or avoid the
specific adverse impact. Nothing in this subdivision shall be
interpreted to require a local government to grant an incentive or
concession that would have an adverse impact on any real property
that is listed in the California Register of Historical Resources.
The city, county, or city and county shall establish procedures for
carrying out this section, that shall include legislative body
approval of the means of compliance with this section. The city,
county, or city and county shall also establish procedures for
waiving or modifying development and zoning standards that would
otherwise inhibit the utilization of the density bonus on specific
sites. These procedures shall include, but not be limited to, such
items as minimum lot size, side yard setbacks, and placement of
public works improvements.
(e) In no case may a city, county, or city and county apply any
development standard that will have the effect of precluding the
construction of a development meeting the criteria of subdivision (b)
at the densities or with the concessions or incentives permitted by
this section. An applicant may submit to a city, county, or city and
county a proposal for the waiver or reduction of development
standards and may request a meeting with the city, county, or city
and county. If a court finds that the refusal to grant a waiver or
reduction of development standards is in violation of this section,
the court shall award the plaintiff reasonable attorney's fees and
costs of suit. Nothing in this subdivision shall be interpreted to
require a local government to waive or reduce development standards
if the waiver or reduction would have a specific, adverse impact, as
defined in paragraph (2) of subdivision (d) of Section 65589.5, upon
health, safety, or the physical environment, and for which there is
no feasible method to satisfactorily mitigate or avoid the specific
adverse impact. Nothing in this subdivision shall be interpreted to
require a local government to waive or reduce development standards
that would have an adverse impact on any real property that is listed
in the California Register of Historical Resources.
(f) The applicant shall show that the waiver or modification is
necessary to make the housing units economically feasible.
(g) For the purposes of this chapter, "density bonus" means a
density increase over the otherwise maximum allowable residential
density under the applicable zoning ordinance and land use element of
the general plan as of the date of application by the applicant to
the city, county, or city and county. The applicant may elect to
accept a lesser percentage of density bonus. The amount of density
bonus to which the applicant is entitled shall vary according to the
amount by which the percentage of affordable housing units exceeds
the percentage established in subdivision (b).
(1) For housing developments meeting the criteria of subparagraph
(A) of paragraph (1) of subdivision (b), the density bonus shall be
calculated as follows:
Percentage Low-Income Percentage Density Bonus
Units
10 20
11 21.5
12 23
13 24.5
14 26
15 27.5
17 30.5
18 32
19 33.5
20 35
(2) For housing developments meeting the criteria of subparagraph
(B) of paragraph (1) of subdivision (b), the density bonus shall be
calculated as follows:
Percentage Very Low Percentage Density Bonus
Income Units
5 20
6 22.5
7 25
8 27.5
9 30
10 32.5
11 35
(3) For housing developments meeting the criteria of subparagraph
(C) of paragraph (1) of subdivision (b), the density bonus shall be
20 percent.
(4) For housing developments meeting the criteria of subparagraph
(D) of paragraph (1) of subdivision (b), the density bonus shall be
calculated as follows:
Percentage Moderate- Percentage Density Bonus
Income Units
10 5
11 6
12 7
13 8
14 9
15 10
16 11
17 12
18 13
19 14
20 15
21 16
22 17
23 18
24 19
25 20
26 21
27 22
28 23
29 24
30 25
31 26
32 27
33 28
34 29
35 30
36 31
37 32
38 33
39 34
40 35
(5) All density calculations resulting in fractional units shall
be rounded up to the next whole number. The granting of a density
bonus shall not be interpreted, in and of itself, to require a
general plan amendment, local coastal plan amendment, zoning change,
or other discretionary approval. As used in subdivision (b), "total
units" or "total dwelling units" does not include units permitted by
a density bonus awarded pursuant to this section or any local law
granting a greater density bonus. The density bonus provided by this
section shall apply to housing developments consisting of five or
more dwelling units.
(h) (1) When an applicant for a tentative subdivision map, parcel
map, or other residential development approval donates land to a
city, county, or city and county as provided for in this subdivision,
the applicant shall be entitled to a 15-percent increase above the
otherwise maximum allowable residential density under the applicable
zoning ordinance and land use element of the general plan for the
entire development, as follows:
Percentage Very Low Percentage Density Bonus
Income
10 15
11 16
12 17
13 18
14 19
15 20
16 21
17 22
18 23
19 24
20 25
21 26
22 27
23 28
24 29
25 30
26 31
27 32
28 33
29 34
30 35
(2) This increase shall be in addition to any increase in density
mandated by subdivision (b), up to a maximum combined mandated
density increase of 35 percent if an applicant seeks both the
increase required pursuant to this subdivision and subdivision (b).
All density calculations resulting in fractional units shall be
rounded up to the next whole number. Nothing in this subdivision
shall be construed to enlarge or diminish the authority of a city,
county, or city and county to require a developer to donate land as a
condition of development. An applicant shall be eligible for the
increased density bonus described in this subdivision if all of the
following conditions are met:
(A) The applicant donates and transfers the land no later than the
date of approval of the final subdivision map, parcel map, or
residential development application.
(B) The developable acreage and zoning classification of the land
being transferred are sufficient to permit construction of units
affordable to very low income households in an amount not less than
10 percent of the number of residential units of the proposed
development.
(C) The transferred land is at least one acre in size or of
sufficient size to permit development of at least 40 units, has the
appropriate general plan designation, is appropriately zoned for
development as affordable housing, and is or will be served by
adequate public facilities and infrastructure. The land shall have
appropriate zoning and development standards to make the development
of the affordable units feasible. No later than the date of approval
of the final subdivision map, parcel map, or of the residential
development, the transferred land shall have all of the permits and
approvals, other than building permits, necessary for the development
of the very low income housing units on the transferred land, except
that the local government may subject the proposed development to
subsequent design review to the extent authorized by subdivision (i)
of Section 65583.2 if the design is not reviewed by the local
government prior to the time of transfer.
(D) The transferred land and the affordable units shall be subject
to a deed restriction ensuring continued affordability of the units
consistent with paragraphs (1) and (2) of subdivision (c), which
shall be recorded on the property at the time of dedication.
(E) The land is transferred to the local agency or to a housing
developer approved by the local agency. The local agency may require
the applicant to identify and transfer the land to the developer.
(F) The transferred land shall be within the boundary of the
proposed development or, if the local agency agrees, within
one-quarter mile of the boundary of the proposed development.
(i) (1) When an applicant proposes to construct a housing
development that conforms to the requirements of subdivision (b) and
includes a child care facility that will be located on the premises
of, as part of, or adjacent to, the project, the city, county, or
city and county shall grant either of the following:
(A) An additional density bonus that is an amount of square feet
of residential space that is equal to or greater than the amount of
square feet in the child care facility.
(B) An additional concession or incentive that contributes
significantly to the economic feasibility of the construction of the
child care facility.
(2) The city, county, or city and county shall require, as a
condition of approving the housing development, that the following
occur:
(A) The child care facility shall remain in operation for a period
of time that is as long as or longer than the period of time during
which the density bonus units are required to remain affordable
pursuant to subdivision (c).
(B) Of the children who attend the child care facility, the
children of very low income households, lower income households, or
families of moderate income shall equal a percentage that is equal to
or greater than the percentage of dwelling units that are required
for very low income households, lower income households, or families
of moderate income pursuant to subdivision (b).
(3) Notwithstanding any requirement of this subdivision, a city,
county, or a city and county shall not be required to provide a
density bonus or concession for a child care facility if it finds,
based upon substantial evidence, that the community has adequate
child care facilities.
(4) "Child care facility," as used in this section, means a child
day care facility other than a family day care home, including, but
not limited to, infant centers, preschools, extended day care
facilities, and schoolage child care centers.
(j) "Housing development," as used in this section, means one or
more groups of projects for residential units constructed in the
planned development of a city, county, or city and county. For the
purposes of this section, "housing development" also includes a
subdivision or common interest development, as defined in Section
1351 4100 of the Civil Code, approved
by a city, county, or city and county and consists of residential
units or unimproved residential lots and either a project to
substantially rehabilitate and convert an existing commercial
building to residential use or the substantial rehabilitation of an
existing multifamily dwelling, as defined in subdivision (d) of
Section 65863.4, where the result of the rehabilitation would be a
net increase in available residential units. For the purpose of
calculating a density bonus, the residential units do not have to be
based upon individual subdivision maps or parcels. The density bonus
shall be permitted in geographic areas of the housing development
other than the areas where the units for the lower income households
are located.
(k) The granting of a concession or incentive shall not be
interpreted, in and of itself, to require a general plan amendment,
local coastal plan amendment, zoning change, or other discretionary
approval. This provision is declaratory of existing law.
(l) For the purposes of this chapter, concession or incentive
means any of the following:
(1) A reduction in site development standards or a modification of
zoning code requirements or architectural design requirements that
exceed the minimum building standards approved by the California
Building Standards Commission as provided in Part 2.5 (commencing
with Section 18901) of Division 13 of the Health and Safety Code,
including, but not limited to, a reduction in setback and square
footage requirements and in the ratio of vehicular parking spaces
that would otherwise be required that results in identifiable,
financially sufficient, and actual cost reductions.
(2) Approval of mixed use zoning in conjunction with the housing
project if commercial, office, industrial, or other land uses will
reduce the cost of the housing development and if the commercial,
office, industrial, or other land uses are compatible with the
housing project and the existing or planned development in the area
where the proposed housing project will be located.
(3) Other regulatory incentives or concessions proposed by the
developer or the city, county, or city and county that result in
identifiable, financially sufficient, and actual cost reductions.
This subdivision does not limit or require the provision of direct
financial incentives for the housing development, including the
provision of publicly owned land, by the city, county, or city and
county, or the waiver of fees or dedication requirements.
(m) Nothing in this section shall be construed to supersede or in
any way alter or lessen the effect or application of the California
Coastal Act (Division 20 (commencing with Section 30000) of the
Public Resources Code.
(n) Nothing in this section shall be construed to prohibit a city,
county, or city and county from granting a density bonus greater
than what is described in this section for a development that meets
the requirements of this section or from granting a proportionately
lower density bonus than what is required by this section for
developments that do not meet the requirements of this section.
(o) For purposes of this section, the following definitions shall
apply:
(1) "Development standard" includes site or construction
conditions that apply to a residential development pursuant to any
ordinance, general plan element, specific plan, charter amendment, or
other local condition, law, policy, resolution, or regulation.
(2) "Maximum allowable residential density" means the density
allowed under the zoning ordinance, or if a range of density is
permitted, means the maximum allowable density for the specific
zoning range applicable to the project.
(p) (1) Upon the request of the developer, no city, county, or
city and county shall require a vehicular parking ratio, inclusive of
handicapped and guest parking, of a development meeting the criteria
of subdivision (b), that exceeds the following ratios:
(A) Zero to one bedrooms: one onsite parking space.
(B) Two to three bedrooms: two onsite parking spaces.
(C) Four and more bedrooms: two and one-half parking spaces.
(2) If the total number of parking spaces required for a
development is other than a whole number, the number shall be rounded
up to the next whole number. For purposes of this subdivision, a
development may provide "onsite parking" through tandem parking or
uncovered parking, but not through onstreet parking.
(3) This subdivision shall apply to a development that meets the
requirements of subdivision (b) but only at the request of the
applicant. An applicant may request additional parking incentives or
concessions beyond those provided in this section, subject to
subdivision (d).
SEC. 53. Section 65995.5 of the Government Code is amended to
read:
65995.5. (a) The governing board of a school district may impose
the amount calculated pursuant to this section as an alternative to
the amount that may be imposed on residential construction calculated
pursuant to subdivision (b) of Section 65995.
(b) To be eligible to impose the fee, charge, dedication, or other
requirement up to the amount calculated pursuant to this section, a
governing board shall do all of the following:
(1) Make a timely application to the State Allocation Board for
new construction funding for which it is eligible and be determined
by the board to meet the eligibility requirements for new
construction funding set forth in Article 2 (commencing with Section
17071.10) and Article 3 (commencing with Section 17071.75) of Chapter
12.5 of Part 10 of the Education Code. A governing board that
submits an application to determine the district's eligibility for
new construction funding shall be deemed eligible if the State
Allocation Board fails to notify the district of the district's
eligibility within 120 days of receipt of the application.
(2) Conduct and adopt a school facility needs analysis pursuant to
Section 65995.6.
(3) Until January 1, 2000, satisfy at least one of the
requirements set forth in subparagraphs (A) to (D), inclusive, and,
on and after January 1, 2000, satisfy at least two of the
requirements set forth in subparagraphs (A) to (D), inclusive:
(A) The district is a unified or elementary school district that
has a substantial enrollment of its elementary school pupils on a
multitrack year-round schedule. "Substantial enrollment" for purposes
of this paragraph means at least 30 percent of district pupils in
kindergarten and grades 1 to 6, inclusive, in the high school
attendance area in which all or some of the new residential units
identified in the needs analysis are planned for construction. A high
school district shall be deemed to have met the requirements of this
paragraph if either of the following apply:
(i) At least 30 percent of the high school district's pupils are
on a multitrack year-round schedule.
(ii) At least 40 percent of the pupils enrolled in public schools
in kindergarten and grades 1 to 12, inclusive, within the boundaries
of the high school attendance area for which the school district is
applying for new facilities are enrolled in multitrack year-round
schools.
(B) The district has placed on the ballot in the previous four
years a local general obligation bond to finance school facilities
and the measure received at least 50 percent plus one of the votes
cast.
(C) The district meets one of the following:
(i) The district has issued debt or incurred obligations for
capital outlay in an amount equivalent to 15 percent of the district'
s local bonding capacity, including indebtedness that is repaid from
property taxes, parcel taxes, the district's general fund, special
taxes levied pursuant to Section 4 of Article XIII A of the
California Constitution, special taxes levied pursuant to Chapter 2.5
(commencing with Section 53311) of Division 2 of Title 5 that are
approved by a vote of registered voters, special taxes levied
pursuant to Chapter 2.5 (commencing with Section 53311) of Division 2
of Title 5 that are approved by a vote of landowners prior to
November 4, 1998, and revenues received pursuant to the Community
Redevelopment Law (Part 1 (commencing with Section 33000) of Division
24 of the Health and Safety Code). Indebtedness or other obligation
to finance school facilities to be owned, leased, or used by the
district, that is incurred by another public agency, shall be counted
for the purpose of calculating whether the district has met the debt
percentage requirement contained herein.
(ii) The district has issued debt or incurred obligations for
capital outlay in an amount equivalent to 30 percent of the district'
s local bonding capacity, including indebtedness that is repaid from
property taxes, parcel taxes, the district's general fund, special
taxes levied pursuant to Section 4 of Article XIII A of the
California Constitution, special taxes levied pursuant to Chapter 2.5
(commencing with Section 53311) of Division 2 of Title 5 that are
approved by a vote of registered voters, special taxes levied
pursuant to Chapter 2.5 (commencing with Section 53311) of Division 2
of Title 5 that are approved by a vote of landowners after November
4, 1998, and revenues received pursuant to the Community
Redevelopment Law (Part 1 (commencing with Section 33000) of Division
24 of the Health and Safety Code). Indebtedness or other obligation
to finance school facilities to be owned, leased, or used by the
district, that is incurred by another public agency, shall be counted
for the purpose of calculating whether the district has met the debt
percentage requirement contained herein.
(D) At least 20 percent of the teaching stations within the
district are relocatable classrooms.
(c) The maximum square foot fee, charge, dedication, or other
requirement authorized by this section that may be collected in
accordance with Chapter 6 (commencing with Section 17620) of Part
10.5 of the Education Code shall be calculated by a governing board
of a school district, as follows:
(1) The number of unhoused pupils identified in the school
facilities needs analysis shall be multiplied by the appropriate
amounts provided in subdivision (a) of Section 17072.10. This sum
shall be added to the site acquisition and development cost
determined pursuant to subdivision (h).
(2) The full amount of local funds the governing board has
dedicated to facilities necessitated by new construction shall be
subtracted from the amount determined pursuant to paragraph (1).
Local funds include fees, charges, dedications, or other requirements
imposed on commercial or industrial construction.
(3) The resulting amount determined pursuant to paragraph (2)
shall be divided by the projected total square footage of assessable
space of residential units anticipated to be constructed during the
next five-year period in the school district or the city and county
in which the school district is located. The estimate of the
projected total square footage shall be based on information
available from the city or county within which the residential units
are anticipated to be constructed or a market report prepared by an
independent third party.
(d) A school district that has a common territorial jurisdiction
with a district that imposes the fee, charge, dedication, or other
requirement up to the amount calculated pursuant to this section or
Section 65995.7, may not impose a fee, charge, dedication, or other
requirement on residential construction that exceeds the limit set
forth in subdivision (b) of Section 65995 less the portion of that
amount it would be required to share pursuant to Section 17623 of the
Education Code, unless that district is eligible to impose the fee,
charge, dedication, or other requirement up to the amount calculated
pursuant to this section or Section 65995.7.
(e) Nothing in this section is intended to limit or discourage the
joint use of school facilities or to limit the ability of a school
district to construct school facilities that exceed the amount of
funds authorized by Section 17620 of the Education Code and provided
by the state grant program, if the additional costs are funded solely
by local revenue sources other than fees, charges, dedications, or
other requirements imposed on new construction.
(f) Except as provided in paragraph (5) of subdivision (a) of
Section 17620 of the Education Code, a fee, charge, dedication, or
other requirement authorized under this section and Section 65995.7
shall be expended solely on the school facilities identified in the
needs analysis as being attributable to projected enrollment growth
from the construction of new residential units. This subdivision does
not preclude the expenditure of a fee, charge, dedication, or other
requirement, authorized pursuant to subparagraph (C) of paragraph (1)
of subdivision (a) of Section 17620, on school facilities identified
in the needs analysis as necessary due to projected enrollment
growth attributable to the new residential units.
(g) "Residential units" and "residences" as used in this section
and in Sections 65995.6 and 65995.7 means the development of
single-family detached housing units, single-family attached housing
units, manufactured homes and mobilehomes, as defined in subdivision
(f) of Section 17625 of the Education Code, condominiums, and
multifamily housing units, including apartments, residential hotels,
as defined in paragraph (1) of subdivision (b) of Section 50519 of
the Health and Safety Code, and stock cooperatives, as defined in
Section 1351 4190 of the Civil Code.
(h) Site acquisition costs shall not exceed half of the amount
determined by multiplying the land acreage determined to be necessary
under the guidelines of the State Department of Education, as
published in the "School Site Analysis and Development Handbook," as
that handbook read as of January 1, 1998, by the estimated cost
determined pursuant to Section 17072.12 of the Education Code. Site
development costs shall not exceed the estimated amount that would be
funded by the State Allocation Board pursuant to its regulations
governing grants for site development costs.
SEC. 54. Section 66411 of the Government Code is amended to read:
66411. Regulation and control of the design and improvement of
subdivisions are vested in the legislative bodies of local agencies.
Each local agency shall, by ordinance, regulate and control the
initial design and improvement of common interest developments ,
as defined in Section 1351 4100
of the Civil Code and subdivisions for which this division requires a
tentative and final or parcel map. In the development, adoption,
revision, and application of such the
ordinance, the local agency shall comply with the provisions of
Section 65913.2. The ordinance shall specifically provide for proper
grading and erosion control, including the prevention of
sedimentation or damage to offsite property. Each local agency may by
ordinance regulate and control other subdivisions, provided that the
regulations are not more restrictive than the regulations for those
subdivisions for which a tentative and final or parcel map are
required by this division, and provided further that the regulations
shall not be applied to short-term leases (terminable by either party
on not more than 30 days' notice in writing) of a portion of the
operating right-of-way of a railroad corporation as defined by
Section 230 of the Public Utilities Code unless a showing is made in
individual cases, under substantial evidence, that public policy
necessitates the application of the regulations to those short-term
leases in individual cases.
SEC. 55. Section 66412 of the Government Code is amended to read:
66412. This division shall be inapplicable to any of the
following:
(a) The financing or leasing of apartments, offices, stores, or
similar space within apartment buildings, industrial buildings,
commercial buildings, mobilehome parks, or trailer parks.
(b) Mineral, oil, or gas leases.
(c) Land dedicated for cemetery purposes under the Health and
Safety Code.
(d) A lot line adjustment between four or fewer existing adjoining
parcels, where the land taken from one parcel is added to an
adjoining parcel, and where a greater number of parcels than
originally existed is not thereby created, if the lot line adjustment
is approved by the local agency, or advisory agency. A local agency
or advisory agency shall limit its review and approval to a
determination of whether or not the parcels resulting from the lot
line adjustment will conform to the local general plan, any
applicable specific plan, any applicable coastal plan, and zoning and
building ordinances. An advisory agency or local agency shall not
impose conditions or exactions on its approval of a lot line
adjustment except to conform to the local general plan, any
applicable specific plan, any applicable coastal plan, and zoning and
building ordinances, to require the prepayment of real property
taxes prior to the approval of the lot line adjustment, or to
facilitate the relocation of existing utilities, infrastructure, or
easements. No tentative map, parcel map, or final map shall be
required as a condition to the approval of a lot line adjustment. The
lot line adjustment shall be reflected in a deed, which shall be
recorded. No record of survey shall be required for a lot line
adjustment unless required by Section 8762 of the Business and
Professions Code.
(e) Boundary line or exchange agreements to which the State Lands
Commission or a local agency holding a trust grant of tide and
submerged lands is a party.
(f) Any separate assessment under Section 2188.7 of the Revenue
and Taxation Code.
(g) Unless a parcel or final map was approved by the legislative
body of a local agency, the conversion of a community apartment
project, as defined in Section 1351 4105
of the Civil Code, to a condominium, as defined in Section 783
of the Civil Code, but only if all of the following requirements are
met:
(1) At least 75 percent of the units in the project were occupied
by record owners of the project on March 31, 1982.
(2) A final or parcel map of the project was properly recorded, if
the property was subdivided, as defined in Section 66424, after
January 1, 1964, with all of the conditions of that map remaining in
effect after the conversion.
(3) The local agency certifies that the above requirements were
satisfied if the local agency, by ordinance, provides for that
certification.
(4) Subject to compliance with subdivision (e) of Section
1351 Section 6075 of the Civil Code, all
conveyances and other documents necessary to effectuate the
conversion shall be executed by the required number of owners in the
project as specified in the bylaws or other organizational documents.
If the bylaws or other organizational documents do not expressly
specify the number of owners necessary to execute the conveyances and
other documents, a majority of owners in the project shall be
required to execute the conveyances or other documents. Conveyances
and other documents executed under the foregoing provisions shall be
binding upon and affect the interests of all parties in the project.
(h) Unless a parcel or final map was approved by the legislative
body of a local agency, the conversion of a stock cooperative, as
defined in Section 1351 4190 of the
Civil Code, to a condominium, as defined in Section 783 of the Civil
Code, but only if all of the following requirements are met:
(1) At least 51 percent of the units in the cooperative were
occupied by stockholders of the cooperative on January 1, 1981, or
individually owned by stockholders of the cooperative on January 1,
1981. As used in this paragraph, a cooperative unit is "individually
owned" if and only if the stockholder of that unit owns or partially
owns an interest in no more than one unit in the cooperative.
(2) No more than 25 percent of the shares of the cooperative were
owned by any one person, as defined in Section 17, including an
incorporator or director of the cooperative, on January 1, 1981.
(3) A person renting a unit in a cooperative shall be entitled at
the time of conversion to all tenant rights in state or local law,
including, but not limited to, rights respecting first refusal,
notice, and displacement and relocation benefits.
(4) The local agency certifies that the above requirements were
satisfied if the local agency, by ordinance, provides for that
certification.
(5) Subject to compliance with subdivision (e) of Section
1351 Section 6075 of the Civil Code, all
conveyances and other documents necessary to effectuate the
conversion shall be executed by the required number of owners in the
cooperative as specified in the bylaws or other organizational
documents. If the bylaws or other organizational documents do not
expressly specify the number of owners necessary to execute the
conveyances and other
documents, a majority of owners in the cooperative shall be required
to execute the conveyances or other documents. Conveyances and other
documents executed under the foregoing provisions shall be binding
upon and affect the interests of all parties in the cooperative.
(i) The leasing of, or the granting of an easement to, a parcel of
land, or any portion or portions thereof, in conjunction with the
financing, erection, and sale or lease of a windpowered electrical
generation device on the land, if the project is subject to
discretionary action by the advisory agency or legislative body.
(j) The leasing or licensing of a portion of a parcel, or the
granting of an easement, use permit, or similar right on a portion of
a parcel, to a telephone corporation as defined in Section 234 of
the Public Utilities Code, exclusively for the placement and
operation of cellular radio transmission facilities, including, but
not limited to, antennae support structures, microwave dishes,
structures to house cellular communications transmission equipment,
power sources, and other equipment incidental to the transmission of
cellular communications, if the project is subject to discretionary
action by the advisory agency or legislative body.
(k) Leases of agricultural land for agricultural purposes. As used
in this subdivision, "agricultural purposes" means the cultivation
of food or fiber, or the grazing or pasturing of livestock.
SEC. 56. Section 66424 of the Government Code is amended to read:
66424. "Subdivision" means the division, by any subdivider, of
any unit or units of improved or unimproved land, or any portion
thereof, shown on the latest equalized county assessment roll as a
unit or as contiguous units, for the purpose of sale, lease or
financing, whether immediate or future. Property shall be considered
as contiguous units, even if it is separated by roads, streets,
utility easement or railroad rights-of-way. "Subdivision" includes a
condominium project, as defined in subdivision (f) of
Section 1351 Section 4125 of the Civil Code, a
community apartment project, as defined in subdivision (d)
of Section 1351 Section 4105 of the Civil Code,
or the conversion of five or more existing dwelling units to a stock
cooperative, as defined in subdivision (m) of Section 1351
Section 4190 of the Civil Code.
SEC. 57. Section 66427 of the Government Code is amended to read:
66427. (a) A map of a condominium project, a community apartment
project, or of the conversion of five or more existing dwelling units
to a stock cooperative project need not show the buildings or the
manner in which the buildings or the airspace above the property
shown on the map are to be divided, nor shall the governing body have
the right to refuse approval of a parcel, tentative, or final map of
the project on account of the design or the location of buildings on
the property shown on the map that are not violative of local
ordinances or on account of the manner in which airspace is to be
divided in conveying the condominium.
(b) A map need not include a condominium plan or plans, as defined
in subdivision (e) of Section 1351 Section
4120 of the Civil Code, and the governing body may not refuse
approval of a parcel, tentative, or final map of the project on
account of the absence of a condominium plan.
(c) Fees and lot design requirements shall be computed and imposed
with respect to those maps on the basis of parcels or lots of the
surface of the land shown thereon as included in the project.
(d) Nothing herein shall be deemed to limit the power of the
legislative body to regulate the design or location of buildings in a
project by or pursuant to local ordinances.
(e) If the governing body has approved a parcel map or final map
for the establishment of condominiums on property pursuant to the
requirements of this division, the separation of a three-dimensional
portion or portions of the property from the remainder of the
property or the division of that three-dimensional portion or
portions into condominiums shall not constitute a further subdivision
as defined in Section 66424, provided each of the following
conditions has been satisfied:
(1) The total number of condominiums established is not increased
above the number authorized by the local agency in approving the
parcel map or final map.
(2) A perpetual estate or an estate for years in the remainder of
the property is held by the condominium owners in undivided interests
in common, or by an association as defined in subdivision
(a) of Section 1351 Section 4080 of the Civil
Code, and the duration of the estate in the remainder of the property
is the same as the duration of the estate in the condominiums.
(3) The three-dimensional portion or portions of property are
described on a condominium plan or plans, as defined in
subdivision (e) of Section 1351 Section 4120 of
the Civil Code.
SEC. 58. Section 66452.10 of the Government Code is amended to
read:
66452.10. A stock cooperative, as defined in Section 11003.2 of
the Business and Professions Code, or a community apartment project,
as defined in Section 11004 of the Business and Professions Code,
shall not be converted to a condominium, as defined in Section 783 of
the Civil Code, unless the required number of (1) owners and (2)
trustees or beneficiaries of each recorded deed of trust and
mortgagees of each recorded mortgage in the cooperative or project,
as specified in the bylaws, or other organizational documents, have
voted in favor of the conversion. If the bylaws or other
organizational documents do not expressly specify the number of votes
required to approve the conversion, a majority vote of the (1)
owners and (2) trustees or beneficiaries of each recorded deed of
trust and mortgagees of each recorded mortgage in the cooperative or
project shall be required. Upon approval of the conversion as set
forth above and in compliance with subdivision (e) of
Section 1351 Section 6075 of the Civil Code, all
conveyances and other documents necessary to effectuate the
conversion shall be executed by the required number of owners in the
cooperative or project as specified in the bylaws or other
organizational documents. If the bylaws or other organizational
documents do not expressly specify the number of owners necessary to
execute the conveyances or other documents, a majority of owners in
the cooperative or project shall be required to execute the
conveyances and other documents. Conveyances and other documents
executed under the foregoing provisions shall be binding upon and
affect the interests of all parties in the cooperative or project.
The provisions of Section 66499.31 shall not apply to a violation of
this section.
SEC. 59. Section 66475.2 of the Government Code is amended to
read:
66475.2. (a) There may be imposed by local ordinance a
requirement of a dedication or an irrevocable offer of dedication of
land within the subdivision for local transit facilities such as bus
turnouts, benches, shelters, landing pads and similar items that
directly benefit the residents of a subdivision. The irrevocable
offers may be terminated as provided in subdivisions (c) and (d) of
Section 66477.2.
(b) Only the payment of fees in lieu of the dedication of land may
be required in subdivisions that consist of the subdivision of
airspace in existing buildings into condominium projects, stock
cooperatives, or community apartment projects, as those terms are
defined in Section 1351 Sections 4125, 4190,
and 4105 of the Civil Code.
SEC. 60. Section 66477 of the Government Code is amended to read:
66477. (a) The legislative body of a city or county may, by
ordinance, require the dedication of land or impose a requirement of
the payment of fees in lieu thereof, or a combination of both, for
park or recreational purposes as a condition to the approval of a
tentative map or parcel map, if all of the following requirements are
met:
(1) The ordinance has been in effect for a period of 30 days prior
to the filing of the tentative map of the subdivision or parcel map.
(2) The ordinance includes definite standards for determining the
proportion of a subdivision to be dedicated and the amount of any fee
to be paid in lieu thereof. The amount of land dedicated or fees
paid shall be based upon the residential density, which shall be
determined on the basis of the approved or conditionally approved
tentative map or parcel map and the average number of persons per
household. There shall be a rebuttable presumption that the average
number of persons per household by units in a structure is the same
as that disclosed by the most recent available federal census or a
census taken pursuant to Chapter 17 (commencing with Section 40200)
of Part 2 of Division 3 of Title 4. However, the dedication of land,
or the payment of fees, or both, shall not exceed the proportionate
amount necessary to provide three acres of park area per 1,000
persons residing within a subdivision subject to this section, unless
the amount of existing neighborhood and community park area, as
calculated pursuant to this subdivision, exceeds that limit, in which
case the legislative body may adopt the calculated amount as a
higher standard not to exceed five acres per 1,000 persons residing
within a subdivision subject to this section.
(A) The park area per 1,000 members of the population of the city,
county, or local public agency shall be derived from the ratio that
the amount of neighborhood and community park acreage bears to the
total population of the city, county, or local public agency as shown
in the most recent available federal census. The amount of
neighborhood and community park acreage shall be the actual acreage
of existing neighborhood and community parks of the city, county, or
local public agency as shown on its records, plans, recreational
element, maps, or reports as of the date of the most recent available
federal census.
(B) For cities incorporated after the date of the most recent
available federal census, the park area per 1,000 members of the
population of the city shall be derived from the ratio that the
amount of neighborhood and community park acreage shown on the
records, maps, or reports of the county in which the newly
incorporated city is located bears to the total population of the new
city as determined pursuant to Section 11005 of the Revenue and
Taxation Code. In making any subsequent calculations pursuant to this
section, the county in which the newly incorporated city is located
shall not include the figures pertaining to the new city which were
calculated pursuant to this paragraph. Fees shall be payable at the
time of the recording of the final map or parcel map or at a later
time as may be prescribed by local ordinance.
(3) The land, fees, or combination thereof are to be used only for
the purpose of developing new or rehabilitating existing
neighborhood or community park or recreational facilities to serve
the subdivision.
(4) The legislative body has adopted a general plan or specific
plan containing policies and standards for parks and recreation
facilities, and the park and recreational facilities are in
accordance with definite principles and standards.
(5) The amount and location of land to be dedicated or the fees to
be paid shall bear a reasonable relationship to the use of the park
and recreational facilities by the future inhabitants of the
subdivision.
(6) The city, county, or other local public agency to which the
land or fees are conveyed or paid shall develop a schedule specifying
how, when, and where it will use the land or fees, or both, to
develop park or recreational facilities to serve the residents of the
subdivision. Any fees collected under the ordinance shall be
committed within five years after the payment of the fees or the
issuance of building permits on one-half of the lots created by the
subdivision, whichever occurs later. If the fees are not committed,
they, without any deductions, shall be distributed and paid to the
then record owners of the subdivision in the same proportion that the
size of their lot bears to the total area of all lots within the
subdivision.
(7) Only the payment of fees may be required in subdivisions
containing 50 parcels or less, except that when a condominium
project, stock cooperative, or community apartment project, as those
terms are defined in Section 1351 Sections
4125, 4190, and 4105 of the Civil Code, exceeds 50 dwelling
units, dedication of land may be required notwithstanding that the
number of parcels may be less than 50.
(8) Subdivisions containing less than five parcels and not used
for residential purposes shall be exempted from the requirements of
this section. However, in that event, a condition may be placed on
the approval of a parcel map that if a building permit is requested
for construction of a residential structure or structures on one or
more of the parcels within four years, the fee may be required to be
paid by the owner of each parcel as a condition of the issuance of
the permit.
(9) If the subdivider provides park and recreational improvements
to the dedicated land, the value of the improvements together with
any equipment located thereon shall be a credit against the payment
of fees or dedication of land required by the ordinance.
(b) Land or fees required under this section shall be conveyed or
paid directly to the local public agency which
that provides park and recreational services on a
communitywide level and to the area within which the proposed
development will be located, if that agency elects to accept the land
or fee. The local agency accepting the land or funds shall develop
the land or use the funds in the manner provided in this section.
(c) If park and recreational services and facilities are provided
by a public agency other than a city or a county, the amount and
location of land to be dedicated or fees to be paid shall, subject to
paragraph (2) of subdivision (a), be jointly determined by the city
or county having jurisdiction and that other public agency.
(d) This section does not apply to commercial or industrial
subdivisions or to condominium projects or stock cooperatives that
consist of the subdivision of airspace in an existing apartment
building that is more than five years old when no new dwelling units
are added.
(e) Common interest developments, as defined in Section
1351 4100 of the Civil Code, shall be eligible
to receive a credit, as determined by the legislative body, against
the amount of land required to be dedicated, or the amount of the fee
imposed, pursuant to this section, for the value of private open
space within the development which that
is usable for active recreational uses.
(f) Park and recreation purposes shall include land and facilities
for the activity of "recreational community gardening," which
activity consists of the cultivation by persons other than, or in
addition to, the owner of the land, of plant material not for sale.
(g) This section shall be known and may be cited as the Quimby
Act.
SEC. 61. Section 1597.531 of the Health and Safety Code is amended
to read:
1597.531. (a) All family day care homes for children shall
maintain in force either liability insurance covering injury to
clients and guests in the amount of at least one hundred thousand
dollars ($100,000) per occurrence and three hundred thousand dollars
($300,000) in the total annual aggregate, sustained on account of the
negligence of the licensee or its employees, or a bond in the
aggregate amount of three hundred thousand dollars ($300,000). In
lieu of the liability insurance or the bond, the family day care home
may maintain a file of affidavits signed by each parent with a child
enrolled in the home which that meets
the requirements of this subdivision. The affidavit shall state that
the parent has been informed that the family day care home does not
carry liability insurance or a bond according to standards
established by the state. If the provider does not own the premises
used as the family day care home, the affidavit shall also state that
the parent has been informed that the liability insurance, if any,
of the owner of the property or the homeowners' association, as
appropriate, may not provide coverage for losses arising out of, or
in connection with, the operation of the family day care home, except
to the extent that the losses are caused by, or result from, an
action or omission by the owner of the property or the homeowners'
association, for which the owner of the property or the homeowners'
association would otherwise be liable under the law. These affidavits
shall be on a form provided by the department and shall be reviewed
at each licensing inspection.
(b) A family day care home that maintains liability insurance or
a bond pursuant to this section, and that provides care in premises
that are rented or leased or uses premises which
that share common space governed by a homeowners'
association, shall name the owner of the property or the homeowners'
association, as appropriate, as an additional insured party on the
liability insurance policy or bond if all of the following conditions
are met:
(1) The owner of the property or governing body of the homeowners'
association makes a written request to be added as an additional
insured party.
(2) The addition of the owner of the property or the homeowners'
association does not result in cancellation or nonrenewal of the
insurance policy or bond carried by the family day care home.
(3) Any additional premium assessed for this coverage is paid by
the owner of the property or the homeowners' association.
(c) As used in this section, "homeowners' association" means an
association of a common interest development, as defined in Section
1351 4100 of the Civil Code.
SEC. 62. Section 13132.7 of the Health and Safety Code is amended
to read:
13132.7. (a) Within a very high fire hazard severity zone
designated by the Director of Forestry and Fire Protection pursuant
to Article 9 (commencing with Section 4201) of Chapter 1 of Part 2 of
Division 4 of the Public Resources Code and within a very high
hazard severity zone designated by a local agency pursuant to Chapter
6.8 (commencing with Section 51175) of Part 1 of Division 1 of Title
5 of the Government Code, the entire roof covering of every existing
structure where more than 50 percent of the total roof area is
replaced within any one-year period, every new structure, and any
roof covering applied in the alteration, repair, or replacement of
the roof of every existing structure, shall be a fire retardant roof
covering that is at least class B as defined in the Uniform Building
Code, as adopted and amended by the State Building Standards
Commission.
(b) In all other areas, the entire roof covering of every existing
structure where more than 50 percent of the total roof area is
replaced within any one-year period, every new structure, and any
roof covering applied in the alteration, repair, or replacement of
the roof of every existing structure, shall be a fire retardant roof
covering that is at least class C as defined in the Uniform Building
Code, as adopted and amended by the State Building Standards
Commission.
(c) Notwithstanding subdivision (b), within state responsibility
areas classified by the State Board of Forestry and Fire Protection
pursuant to Article 3 (commencing with Section 4125) of Chapter 1 of
Part 2 of Division 4 of the Public Resources Code, except for those
state responsibility areas designated as moderate fire hazard
responsibility zones, the entire roof covering of every existing
structure where more than 50 percent of the total roof area is
replaced within any one-year period, every new structure, and any
roof covering applied in the alteration, repair, or replacement of
the roof of every existing structure, shall be a fire retardant roof
covering that is at least class B as defined in the Uniform Building
Code, as adopted and amended by the State Building Standards
Commission.
(d) (1) Notwithstanding subdivision (a), (b), or (c), within very
high fire hazard severity zones designated by the Director of
Forestry and Fire Protection pursuant to Article 9 (commencing with
Section 4201) of Chapter 1 of Part 2 of Division 4 of the Public
Resources Code or by a local agency pursuant to Chapter 6.8
(commencing with Section 51175) of Part 1 of Division 1 of Title 5 of
the Government Code, the entire roof covering of every existing
structure where more than 50 percent of the total roof area is
replaced within any one-year period, every new structure, and any
roof covering applied in the alteration, repair, or replacement of
the roof of every existing structure, shall be a fire retardant roof
covering that is at least class A as defined in the Uniform Building
Code, as adopted and amended by the State Building Standards
Commission.
(2) Paragraph (1) does not apply to any jurisdiction containing a
very high fire hazard severity zone if the jurisdiction fulfills both
of the following requirements:
(A) Adopts the model ordinance approved by the State Fire Marshal
pursuant to Section 51189 of the Government Code or an ordinance that
substantially conforms to the model ordinance of the State Fire
Marshal.
(B) Transmits, upon adoption, a copy of the ordinance to the State
Fire Marshal.
(e) The State Building Standards Commission shall incorporate the
requirements set forth in subdivisions (a), (b), and (c) by
publishing them as an amendment to the California Building Standards
Code in accordance with Chapter 4 (commencing with Section 18935) of
Part 2.5 of Division 13.
(f) Nothing in this section shall limit the authority of a city,
county, city and county, or fire protection district in establishing
more restrictive requirements, in accordance with current law, than
those specified in this section.
(g) This section shall not affect the validity of an ordinance,
adopted prior to the effective date for the relevant roofing standard
specified in subdivisions (a) and (b), by a city, county, city and
county, or fire protection district, unless the ordinance mandates a
standard that is less stringent than the standards set forth in
subdivision (a), in which case the ordinance shall not be valid on or
after the effective date for the relevant roofing standard specified
in subdivisions (a) and (b).
(h) Any qualified historical building or structure as defined in
Section 18955 may, on a case-by-case basis, utilize alternative roof
constructions as provided by the State Historical Building Code.
(i) The installer of the roof covering shall provide certification
of the roof covering classification, as provided by the manufacturer
or supplier, to the building owner and, when requested, to the
agency responsible for enforcement of this part. The installer shall
also install the roof covering in accordance with the manufacturer's
listing.
(j) No wood roof covering materials shall be sold or applied in
this state unless both of the following conditions are met:
(1) The materials have been approved and listed by the State Fire
Marshal as complying with the requirements of this section.
(2) The materials have passed at least five years of the 10-year
natural weathering test. The 10-year natural weathering test required
by this subdivision shall be conducted in accordance with standard
15-2 of the 1994 edition of the Uniform Building Code at a testing
facility recognized by the State Fire Marshal.
(k) The Insurance Commissioner shall accept the use of fire
retardant wood roof covering material that complies with the
requirements of this section, used in the partial repair or
replacement of nonfire retardant wood roof covering material, as
complying with the requirement in Section 2695.9 of Title 10 of the
California Code of Regulations relative to matching replacement items
in quality, color, and size.
() No common interest development, as defined in Section
1351 4100 of the Civil Code, may require a
homeowner to install or repair a roof in a manner that is in
violation of this section. The governing documents, as defined in
Section 1351 4150 of the Civil Code, of
a common interest development within a very high fire severity zone
shall allow for at least one type of fire retardant roof covering
material that meets the requirements of this section.
SEC. 63. Section 19850 of the Health and Safety Code is amended to
read:
19850. The building department of every city or county shall
maintain an official copy, which may be on microfilm or other type of
photographic copy, of the plans of every building, during the life
of the building, for which the department issued a building permit.
"Building department" means the department, bureau, or officer
charged with the enforcement of laws or ordinances regulating the
erection, construction, or alteration of buildings.
Except for plans of a common interest development as defined in
Section 1351 4100 of the Civil Code,
plans need not be filed for:
(a) Single or multiple dwellings not more than two stories and
basement in height.
(b) Garages and other structures appurtenant to buildings
described under subdivision (a).
(c) Farm or ranch buildings.
(d) Any one-story building where the span between bearing walls
does not exceed 25 feet. The exemption in this subdivision does not,
however, apply to a steel frame or concrete building.
SEC. 64. Section 25400.22 of the Health and Safety Code is amended
to read:
25400.22. (a) No later than 10 working days after the date when a
local health officer determines that property is contaminated
pursuant to subdivision (b) of Section 25400.20, the local health
officer shall do all of the following:
(1) Except as provided in paragraph (2), if the property is real
property, record with the county recorder a lien on the property. The
lien shall specify all of the following:
(A) The name of the agency on whose behalf the lien is imposed.
(B) The date on which the property is determined to be
contaminated.
(C) The legal description of the real property and the assessor's
parcel number.
(D) The record owner of the property.
(E) The amount of the lien, which shall be the greater of two
hundred dollars ($200) or the costs incurred by the local health
officer in compliance with this chapter, including, but not limited
to, the cost of inspection performed pursuant to Section 25400.19 and
the county recorder's fee.
(2) (A) If the property is a mobilehome or
manufactured home specified in paragraph (2) of subdivision (t) of
Section 25400.11, amend the permanent record with a restraint on the
mobilehome, or manufactured home with the Department of Housing and
Community Development, in the form prescribed by that department,
providing notice of the determination that the property is
contaminated.
(B) If the property is a recreational vehicle specified in
paragraph (2) of subdivision (t) of Section 25400.11, perfect by
filing with the Department of Motor Vehicles a vehicle license stop
on the recreational vehicle in the form prescribed by that
department, providing notice of the determination that the property
is contaminated.
(C) If the property is a mobilehome or manufactured home, not
subject to paragraph (2) of subdivision (t) of Section 25400.11, is
located on real property, and is not attached to that real property,
the local health officer shall record a lien for the real property
with the county recorder, and the Department of Housing and Community
Development shall amend the permanent record with a restraint for
the mobilehome or manufactured home, in the form and with the
contents prescribed by that department.
(3) A lien, restraint, or vehicle license stop issued pursuant to
paragraph (2) shall specify all of the following:
(A) The name of the agency on whose behalf the lien, restraint, or
vehicle license stop is imposed.
(B) The date on which the property is determined to be
contaminated.
(C) The legal description of the real property and the assessor's
parcel number, and the mailing and street address or space number of
the manufactured home, mobilehome, or recreational vehicle or the
vehicle identification number of the recreational vehicle, if
applicable.
(D) The registered owner of the mobilehome, manufactured home, or
recreational vehicle, if applicable, or the name of the owner of the
real property as indicated in the official county records.
(E) The amount of the lien, if applicable, which shall be the
greater of two hundred dollars ($200) or the costs incurred by the
local health officer in compliance with this chapter, including, but
not limited to, the cost of inspection performed pursuant to Section
25400.19 and the fee charged by the Department of Housing and
Community Development and the Department of Motor Vehicles pursuant
to paragraph (2) of subdivision (b).
(F) Other information required by the county recorder for the
lien, the Department of Housing and Community Development for the
restraint, or the Department of Motor Vehicles for the vehicle
license stop.
(4) Issue to persons specified in subdivisions (d), (e), and (f)
an order prohibiting the use or occupancy of the contaminated
portions of the property.
(b) (1) The county recorder's fees for recording and indexing
documents provided for in this section shall be in the amount
specified in Article 5 (commencing with Section 27360) of Chapter 6
of Part 3 of Title 3 of the Government Code.
(2) The Department of Housing and Community Development and the
Department of Motor Vehicles may charge a fee to cover its
administrative costs for recording and indexing documents provided
for in paragraph (2) of subdivision (a).
(c) (1) A lien recorded pursuant to subdivision (a) shall have the
force, effect, and priority of a judgment lien. The restraint
amending the permanent record pursuant to subdivision (a) shall be
displayed on any manufactured home or mobilehome title search until
the restraint is released. The vehicle license stop shall remain in
effect until it is released.
(2) The local health officer shall not authorize the release of a
lien, restraint, or vehicle license stop made pursuant to subdivision
(a), until one of the following occurs:
(A) The property owner satisfies the real property lien, or the
contamination in the mobilehome, manufactured home, or recreational
vehicle is abated to the satisfaction of the local health officer
consistent with the notice in the restraint, or vehicle license stop
and the local health officer issues a release pursuant to Section
25400.27.
(B) For a manufactured home or mobilehome, the local health
officer determines that the unit will be destroyed or permanently
salvaged. For the purposes of this paragraph, the unit shall not be
reregistered after this determination is made unless the local health
officer issues a release pursuant to Section 25400.27.
(C) The lien, restraint, or vehicle license stop is extinguished
by a senior lien in a foreclosure sale.
(d) Except as otherwise specified in this section, an order issued
pursuant to this section shall be served, either personally or by
certified mail, return receipt requested in the following manner:
(1) For real property, to all known occupants of the property and
to all persons who have an interest in the property, as contained in
the records of the recorder's office of the county in which the
property is located.
(2) In the case of a mobilehome or manufactured home, the order
shall be served to the legal owner, as defined in Section 18005.8,
each junior lienholder, as defined in Section 18005.3, and the
registered owner, as defined in Section 18009.5.
(3) In the case of a recreational vehicle, the order shall be
served on the legal owner, as defined in Section 370 of the Vehicle
Code, and the registered owner, as defined in Section 505 of the
Vehicle Code.
(e) If the whereabouts of the person described in subdivision (d)
are unknown and cannot be ascertained by the local health officer, in
the exercise of reasonable diligence, and the local health officer
makes an affidavit to that effect, the local health officer shall
serve the order by personal service or by mailing a copy of the order
by certified mail, postage prepaid, return receipt requested, as
follows:
(1) The order related to real property shall be served to each
person at the address appearing on the last equalized tax assessment
roll of the county where the property is located, and to all
occupants of the affected unit.
(2) In the case of a mobilehome or manufactured home, the order
shall be served to the legal owner, as defined in Section 18005.8,
each junior lienholder, as defined in Section 18005.3, and the
registered owner, as defined in Section 18009.5, at the address
appearing on the permanent record and all occupants of the affected
unit at the mobilehome park space.
(3) In the case of a recreational vehicle, the order shall be
served on the legal owner, as defined in Section 370 of the Vehicle
Code, and the registered owner, as defined in Section 505 of the
Vehicle Code, at the address appearing on the permanent record and
all occupants of the affected vehicle at the mobilehome park or
special occupancy park space.
(f) (1) The local health officer shall also mail a copy of the
order required by this section to the address of each person or party
having a recorded right, title, estate, lien, or interest in the
property and to the association of a common interest development, as
defined in Section 1351 4100 of the
Civil Code.
(2) In addition to the requirements of paragraph (1), if the
affected property is a mobilehome, manufactured home, or recreational
vehicle, specified in paragraph (2) of subdivision (t) of Section
25400.11, the order issued by the local health officer shall also be
served, either personally or by certified mail, return receipt
requested, to the owner of the mobilehome park or special occupancy
park.
(g) The order issued pursuant to this section shall include all of
the following information:
(1) A description of the property.
(2) The parcel identification number, address, or space number, if
applicable.
(3) The vehicle identification number, if applicable.
(4) A description of the local health officer's intended course of
action.
(5) A specification of the penalties for noncompliance with the
order.
(6) A prohibition on the use of all or portions of the property
that are contaminated.
(7) A description of the measures the property owner is required
to take to decontaminate the property.
(8) An indication of the potential health hazards involved.
(9) A statement that a property owner who fails to provide a
notice or disclosure that is required by this chapter is subject to a
civil penalty of up to five thousand dollars ($5,000).
(h) The local health officer shall provide a copy of the order to
the local building or code enforcement agency or other appropriate
agency responsible for the enforcement of the State Housing Law (Part
1.5 (commencing with Section 17910) of Division 13).
(i) The local health officer shall post the order in a conspicuous
place on the property within one working day of the date that the
order is issued.
SEC. 65. Section 25915.2 of the Health and Safety Code is amended
to read:
25915.2. (a) Notice provided pursuant to this chapter shall be
provided in writing to each individual employee, and shall be mailed
to other owners designated to receive the notice pursuant to
subdivision (a) of Section 25915.5, within 15 days of the first
receipt by the owner of information identifying the presence or
location of asbestos-containing construction materials in the
building. This notice shall be provided annually thereafter. In
addition, if new information regarding those items specified in
paragraphs (1) to (5), inclusive, of subdivision (a) of Section 25915
has been obtained within 90 days after the notice required by this
subdivision is provided or any subsequent 90-day period, then a
supplemental notice shall be provided within 15 days of the close of
that 90-day period.
(b) Notice provided pursuant to this chapter shall be provided to
new employees within 15 days of commencement of work in the
building.
(c) Notice provided pursuant to this chapter shall be mailed to
any new owner designated to receive the notice pursuant to
subdivision (a) of Section 25915.5 within 15 days of the effective
date of the agreement under which a person becomes a new owner.
(d) Subdivisions (a) and (c) shall not be construed to require
owners of a building or part of a building within a residential
common interest development to mail written notification to other
owners of a building or part of a building within the residential
common interest development, if all the following conditions are met:
(1) The association conspicuously posts, in each building or part
of a building known to contain asbestos-containing materials, a
large sign in a prominent location that fully informs persons
entering each building or part of a building within the common
interest development that the association knows the building contains
asbestos-containing materials.
The sign shall also inform persons of the location where further
information, as required by this chapter, is available about the
asbestos-containing materials known to be located in the building.
(2) The owners or association disclose, as soon as practicable
before the transfer of title of a separate interest in the common
interest development, to a transferee the existence of
asbestos-containing material in a building or part of a building
within the common interest development.
Failure to comply with this section shall not invalidate the
transfer of title of real property. This paragraph shall only apply
to transfers of title of separate interests in the common interest
development of which the owners have knowledge. As used in this
section, "association" and "common interest development" are defined
in Section 1351 Sections 4080 and 4100
of the Civil Code.
(e) If a person contracting with an owner receives notice
pursuant to this chapter, that contractor shall provide a copy of the
notice to his or her employees or contractors working within the
building.
(f) If the asbestos-containing construction material in the
building is limited to an area or areas within the building that meet
all the following criteria:
(1) Are unique and physically defined.
(2) Contain asbestos-containing construction materials in
structural, mechanical, or building materials which
that are not replicated throughout the building.
(3) Are not connected to other areas through a common ventilation
system; then, an owner required to give notice to his or her
employees pursuant to subdivision (a) of Section 25915 or 25915.1 may
provide that notice only to the employees working within or entering
that area or those areas of the building meeting the conditions
above.
(g) If the asbestos-containing construction material in the
building is limited to an area or areas within the building that meet
all the following criteria:
(1) Are accessed only by building maintenance employees or
contractors and are not accessed by tenants or employees in the
building, other than on an incidental basis.
(2) Contain asbestos-containing construction materials in
structural, mechanical, or building materials which
that are not replicated in areas of the building
which are accessed by tenants and employees.
(3) The owner knows that no asbestos fibers are being released or
have the reasonable possibility to be released from the material;
then, as to that asbestos-containing construction material, an owner
required to give notice to his or her employees pursuant to
subdivision (a) of Section 25915 or Section 25915.1 may provide that
notice only to its building maintenance employees and contractors who
have access to that area or those areas of the building meeting the
conditions above.
(h) In those areas of a building where the asbestos-containing
construction material is composed only of asbestos fibers
which that are completely encapsulated, if the
owner knows that no asbestos fibers are being released or have the
reasonable possibility to be released from that material in its
present condition and has no knowledge that other asbestos-containing
material is present, then an owner required to give notice pursuant
to subdivision (a) of Section 25915 shall provide the information
required in paragraph (2) of subdivision (a) of Section 25915 and may
substitute the following notice for the requirements of paragraphs
(1), (3), (4), and (5) of subdivision (a) of Section 25915:
(1) The existence of, conclusions from, and a description or list
of the contents of, that portion of any survey conducted to
determine the existence and location of asbestos-containing
construction materials within the building that refers to the
asbestos materials described in this subdivision, and information
describing when and where the results of the survey are available
pursuant to Section 25917.
(2) Information to convey that moving, drilling, boring, or
otherwise disturbing the asbestos-containing construction material
identified may present a health risk and, consequently, should not be
attempted by an unqualified employee. The notice shall identify the
appropriate person the employee is required to contact if the
condition of the asbestos-containing construction material
deteriorates.
SEC. 66. Section 25915.5 of the Health and Safety Code is amended
to read:
25915.5. (a) An owner required to give notice to employees
pursuant to this chapter, in addition to notifying his or her
employees, shall mail, in accordance with this subdivision, a copy of
that notice to all other persons who are owners of the building or
part of the building, with whom the owner has privity of contract.
Receipt of a notice pursuant to this section by an owner, lessee or
operator shall constitute knowledge that the building contains
asbestos-containing construction materials for purposes of this
chapter. Notice to an owner shall be delivered by first-class mail
addressed to the person and at the address designated for the receipt
of notices under the lease, rental agreement, or contract with the
owner.
(b) The delivery of notice under this section or negligent
failure to provide that notice shall not constitute a breach of any
covenant under the lease or rental agreement, and nothing in this
chapter enlarges or diminishes any rights or duties respecting
constructive eviction.
(c) No owner who, in good faith, complies with the provisions of
this section shall be liable to any other owner for any damages
alleged to have resulted from his or her compliance with the
provisions of this section.
(d) This section shall not be construed to apply to owners of a
building or part of a building within a residential common interest
development or association, if the owners comply with the provisions
of subdivision (d) of Section 25915.2. For purposes of this section,
"association" and "common interest development" are defined in
Section 1351 Sections 4080 and 4100 of
the Civil Code.
SEC. 67. Section 33050 of the Health and Safety Code is amended to
read:
33050. (a) It is hereby declared to be the policy of the state
that in undertaking community redevelopment projects under this part
there shall be no discrimination because of any basis listed in
subdivision (a) or (d) of Section 12955 of the Government Code, as
those bases are defined in Sections 12926, 12926.1, subdivision (m)
and paragraph (1) of subdivision (p) of Section 12955, and Section
12955.2 of the Government Code.
(b) Notwithstanding subdivision (a), with respect to familial
status, subdivision (a) shall not be construed to apply to housing
for older persons, as defined in Section 12955.9 of the Government
Code. With respect to familial status, nothing in subdivision (a)
shall be construed to affect Sections 51.2, 51.3, 51.4, 51.10, 51.11,
and 799.5 of the Civil Code, relating to housing for senior
citizens. Subdivision (d) of Section 51 and Section 1360
5760 of the Civil Code and subdivisions (n),
(o), and (p) of Section 12955 of the Government Code shall apply to
subdivision (a).
SEC. 68. Section 33435 of the Health and Safety Code is amended to
read:
33435. (a) Agencies shall obligate lessees and purchasers of real
property acquired in redevelopment projects and owners of property
improved as a part of a redevelopment project to refrain from
restricting the rental, sale, or lease of the property on any basis
listed in subdivision (a) or (d) of Section 12955 of the Government
Code, as those bases are defined in Sections 12926, 12926.1,
subdivision (m) and paragraph (1) of subdivision (p) of Section
12955, and Section 12955.2 of the Government Code. All deeds, leases,
or contracts for the sale, lease, sublease, or other transfer of any
land in a redevelopment project shall contain or be subject to the
nondiscrimination or nonsegregation clauses hereafter prescribed.
(b) Notwithstanding subdivision (a), with respect to familial
status, subdivision (a) shall not be construed to apply to housing
for older persons, as defined in Section 12955.9 of the Government
Code. With respect to familial status, nothing in subdivision (a)
shall be construed to affect Sections 51.2, 51.3, 51.4, 51.10, 51.11,
and 799.5 of the Civil Code, relating to housing for senior
citizens. Subdivision (d) of Section 51 and Section 1360
5760 of the Civil Code and subdivisions (n),
(o), and (p) of Section 12955 of the Government Code shall apply to
subdivision (a).
SEC. 69. Section 33436 of the Health and Safety Code is amended to
read:
33436. Express provisions shall be included in all deeds, leases,
and contracts that the agency proposes to enter into with respect to
the sale, lease, sublease, transfer, use, occupancy, tenure, or
enjoyment of any land in a redevelopment project in substantially the
following form:
(a) (1) In deeds the following language shall appear--"The grantee
herein covenants by and for himself or herself, his or her heirs,
executors, administrators, and assigns, and all persons claiming
under or through them, that there shall be no discrimination against
or segregation of, any person or group of persons on account of any
basis listed in subdivision (a) or (d) of Section 12955 of the
Government Code, as those bases are defined in Sections 12926,
12926.1, subdivision (m) and paragraph (1) of subdivision (p) of
Section 12955, and Section 12955.2 of the Government Code, in the
sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment
of the premises herein conveyed, nor shall the grantee or any person
claiming under or through him or her, establish or permit any
practice or practices of discrimination or segregation with reference
to the selection, location, number, use or occupancy of tenants,
lessees, subtenants, sublessees, or vendees in the premises herein
conveyed. The foregoing covenants shall run with the land."
(2) Notwithstanding paragraph (1), with respect to familial
status, paragraph (1) shall not be construed to apply to housing for
older persons, as defined in Section 12955.9 of the Government Code.
With respect to familial status, nothing in paragraph (1) shall be
construed to affect Sections 51.2, 51.3, 51.4, 51.10, 51.11, and
799.5 of the Civil Code, relating to housing for senior citizens.
Subdivision (d) of Section 51 and Section 1360
5760 of the Civil Code and subdivisions (n), (o), and (p)
of Section 12955 of the Government Code shall apply to paragraph (1).
(b) (1) In leases the following language shall appear--"The lessee
herein covenants by and for himself or herself, his or her heirs,
executors, administrators, and assigns, and all persons claiming
under or through him or her, and this lease is made and accepted upon
and subject to the following conditions:
That there shall be no discrimination against or segregation of
any person or group of persons, on account of any basis listed in
subdivision (a) or (d) of Section 12955 of the Government Code, as
those bases are defined in Sections 12926, 12926.1, subdivision (m)
and paragraph (1) of subdivision (p) of Section 12955, and Section
12955.2 of the Government Code, in the leasing, subleasing,
transferring, use, occupancy, tenure, or enjoyment of the premises
herein leased nor shall the lessee himself or herself, or any person
claiming under or through him or her, establish or permit any such
practice or practices of discrimination or segregation with reference
to the selection, location, number, use, or occupancy, of tenants,
lessees, sublessees, subtenants, or vendees in the premises herein
leased."
(2) Notwithstanding paragraph (1), with respect to familial
status, paragraph (1) shall not be construed to apply to housing for
older persons, as defined in Section 12955.9 of the Government Code.
With respect to familial status, nothing in paragraph (1) shall be
construed to affect Sections 51.2, 51.3, 51.4, 51.10, 51.11, and
799.5 of the Civil Code, relating to housing for senior citizens.
Subdivision (d) of Section 51 and Section 1360
5760 of the Civil Code and subdivisions (n), (o), and (p)
of Section 12955 of the Government Code shall apply to paragraph (1).
(c) In contracts entered into by the agency relating to the sale,
transfer, or leasing of land or any interest therein acquired by the
agency within any survey area or redevelopment project the foregoing
provisions in substantially the forms set forth shall be included and
the contracts shall further provide that the foregoing provisions
shall be binding upon and shall obligate the contracting party or
parties and any subcontracting party or parties, or other transferees
under the instrument.
SEC. 70. Section 33769 of the Health and Safety Code is amended to
read:
33769. (a) An agency shall require that any residence that is
constructed with financing obtained under this chapter shall be open,
upon sale or rental of any portion thereof, to all regardless of any
basis listed in subdivision (a) or (d) of Section 12955 of the
Government Code, as those bases are defined in Sections 12926,
12926.1, subdivision (m) and paragraph (1) of subdivision (p) of
Section 12955, and Section 12955.2 of the Government Code. The agency
shall also require that contractors and subcontractors engaged in
residential construction financed under this chapter shall provide
equal opportunity for employment, without discrimination as to any
basis listed in subdivision (a) of Section 12940 of the Government
Code, as those bases are defined in Sections 12926 and 12926.1 of the
Government Code, and except as otherwise provided in Section 12940
of the Government Code. All contracts and subcontracts for
residential construction financed under this chapter shall be let
without discrimination as to any basis listed in subdivision (a) of
Section 12940 of the Government Code, as those bases are defined in
Sections 12926 and 12926.1 of the Government Code and except as
otherwise provided in Section 12940 of the Government Code. It shall
be the policy of an agency financing residential construction under
this chapter to encourage participation by minority contractors, and
the agency shall adopt rules and regulations to implement this
section.
(b) Notwithstanding subdivision (a), with respect to familial
status, subdivision (a) shall not be construed to apply to housing
for older persons, as defined in Section 12955.9 of the Government
Code. With respect to familial status, nothing in subdivision (a)
shall be construed to affect Sections 51.2, 51.3, 51.4, 51.10, 51.11,
and 799.5 of the Civil Code, relating to housing for senior
citizens. Subdivision (d) of Section 51 and Section 1360
5760 of the Civil Code and subdivisions (n),
(o), and (p) of Section 12955 of the Government Code shall apply to
subdivision (a).
SEC. 71. Section 35811 of the Health and Safety Code is amended to
read:
35811. (a) No financial institution shall discriminate in the
availability of, or in the provision of, financial assistance for the
purpose of purchasing, constructing, rehabilitating, improving, or
refinancing housing accommodations due, in whole or in part, to the
consideration of any basis listed in subdivision (a) or (d) of
Section 12955 of the Government Code, as those bases are defined in
Sections 12926, 12926.1, subdivision (m) and paragraph (1) of
subdivision (p) of Section 12955, and Section 12955.2 of the
Government Code.
(b) Notwithstanding subdivision (a), with respect to familial
status, subdivision (a) shall not be construed to apply to housing
for older persons, as defined in Section 12955.9 of the Government
Code. With respect to familial status, nothing in subdivision (a)
shall be construed to affect Sections 51.2, 51.3, 51.4, 51.10, 51.11,
and 799.5 of the Civil Code, relating to housing for senior
citizens. Subdivision (d) of Section 51 and Section 1360
5760 of the Civil Code and subdivisions (n), (o)
, and (p) of Section 12955
of the Government Code shall apply to subdivision (a).
SEC. 72. Section 37630 of the Health and Safety Code is amended to
read:
37630. (a) The local agency shall require that any property that
is rehabilitated with financing obtained under this part shall be
open, upon sale or rental of any portion thereof, to all regardless
of any basis listed in subdivision (a) or (d) of Section 12955 of the
Government Code, as those bases are defined in Sections 12926,
12926.1, subdivision (m) and paragraph (1) of subdivision (p) of
Section 12955, and Section 12955.2 of the Government Code. The local
agency shall also require that contractors and subcontractors engaged
in historical rehabilitation financed under this part provide equal
opportunity for employment, without discrimination as to any basis
listed in subdivision (a) of Section 12940 of the Government Code, as
those bases are defined in Sections 12926 and 12926.1 of the
Government Code, and except as otherwise provided in Section 12940 of
the Government Code. All contracts and subcontracts for historical
rehabilitation financed under this part shall be let without
discrimination as to any basis listed in subdivision (a) of Section
12940 of the Government Code, as those bases are defined in Sections
12926 and 12926.1 of the Government Code, and except as otherwise
provided in Section 12940 of the Government Code.
(b) Notwithstanding subdivision (a), with respect to familial
status, subdivision (a) shall not be construed to apply to housing
for older persons, as defined in Section 12955.9 of the Government
Code. With respect to familial status, nothing in subdivision (a)
shall be construed to affect Sections 51.2, 51.3, 51.4, 51.10, 51.11,
and 799.5 of the Civil Code, relating to housing for senior
citizens. Subdivision (d) of Section 51 and Section 1360
5760 of the Civil Code and subdivisions (n),
(o), and (p) of Section 12955 of the Government Code shall apply to
subdivision (a).
SEC. 73. Section 37923 of the Health and Safety Code is amended to
read:
37923. (a) The local agency shall require that any residence that
is rehabilitated, constructed, or acquired with financing obtained
under this part shall be open, upon sale or rental of any portion
thereof, to all regardless of any basis listed in subdivision (a) or
(d) of Section 12955 of the Government Code, as those bases are
defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1)
of subdivision (p) of Section 12955, and Section 12955.2 of the
Government Code. The local agency shall also require that contractors
and subcontractors engaged in residential rehabilitation financed
under this part provide equal opportunity for employment, without
discrimination as to any basis listed in subdivision (a) of Section
12940 of the Government Code, as those bases are defined in Sections
12926 and 12926.1 of the Government Code, and except as otherwise
provided in Section 12940 of the Government Code. All contracts and
subcontracts for residential rehabilitation financed under this part
shall be let without discrimination as to any basis listed in
subdivision (a) of Section 12940 of the Government Code, as those
bases are defined in Sections 12926 and 12926.1 of the Government
Code, and except as otherwise provided in Section 12940 of the
Government Code. It shall be the policy of the local agency financing
residential rehabilitation under this part to encourage
participation by minority contractors, and the local agency shall
adopt rules and regulations to implement this section.
(b) Notwithstanding subdivision (a), with respect to familial
status, subdivision (a) shall not be construed to apply to housing
for older persons, as defined in Section 12955.9 of the Government
Code. With respect to familial status, nothing in subdivision (a)
shall be construed to affect Sections 51.2, 51.3, 51.4, 51.10, 51.11,
and 799.5 of the Civil Code, relating to housing for senior
citizens. Subdivision (d) of Section 51 and Section 1360
5760 of the Civil Code and subdivisions (n),
(o), and (p) of Section 12955 of the Government Code shall apply to
subdivision (a).
SEC. 74. Section 50955 of the Health and Safety Code is amended to
read:
50955. (a) The agency and every housing sponsor shall require
that occupancy of housing developments assisted under this part shall
be open to all regardless of any basis listed in subdivision (a) or
(d) of Section 12955 of the Government Code, as those bases are
defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1)
of subdivision (p) of Section 12955, and Section 12955.2 of the
Government Code, that contractors and subcontractors engaged in the
construction of housing developments shall provide an equal
opportunity for employment, without discrimination as to any basis
listed in subdivision (a) of Section 12940 of the Government Code, as
those bases are defined in Sections 12926 and 12926.1 of the
Government Code, and except as otherwise provided in Section 12940 of
the Government Code, and that contractors and subcontractors shall
submit and receive approval of an affirmative action program prior to
the commencement of construction or rehabilitation. Affirmative
action requirements respecting apprenticeship shall be consistent
with Chapter 4 (commencing with Section 3070) of Division 3 of the
Labor Code.
All contracts for the management, construction, or rehabilitation
of housing developments, and contracts let by housing sponsors,
contractors, and subcontractors in the performance of management,
construction or rehabilitation, shall be let without discrimination
as to any basis listed in subdivision (a) of Section 12940 of the
Government Code, as those bases are defined in Sections 12926 and
12926.1 of the Government Code, except as otherwise provided in
Section 12940 of the Government Code, and pursuant to an affirmative
action program, which shall be at not less than the Federal Housing
Administration affirmative action standards unless the board makes a
specific finding that the particular requirement would be unworkable.
The agency shall periodically review implementation of affirmative
action programs required by this section.
It shall be the policy of the agency and housing sponsors to
encourage participation with respect to all projects by minority
developers, builders, and entrepreneurs in all levels of
construction, planning, financing, and management of housing
developments. In areas of minority concentration the agency shall
require significant participation of minorities in the sponsorship,
construction, planning, financing, and management of housing
developments. The agency shall (1) require that, to the greatest
extent feasible, opportunities for training and employment arising in
connection with the planning, construction, rehabilitation, and
operation of housing developments financed pursuant to this part be
given to persons of low income residing in the area of that housing,
and (2) determine and implement means to secure the participation of
small businesses in the performance of contracts for work on housing
developments and to develop the capabilities of these small
businesses to more efficiently and competently participate in the
economic mainstream. In order to achieve this participation by small
businesses, the agency may, among other things, waive retention
requirements otherwise imposed on contractors or subcontractors by
regulation of the agency and may authorize or make advance payments
for work to be performed. The agency shall develop relevant selection
criteria for the participation of small businesses to ensure that,
to the greatest extent feasible, the participants possess the
necessary nonfinancial capabilities. The agency may, with respect to
these small businesses, waive bond requirements otherwise imposed
upon contractors or subcontractors by regulation of the agency, but
the agency shall in that case substantially reduce the risk through
(1) a pooled-risk bonding program, (2) a bond program in cooperation
with other federal or state agencies, or (3) development of a
self-insured bonding program with adequate reserves.
The agency shall adopt rules and regulations to implement this
section.
Prior to commitment of a mortgage loan, the agency shall require
each housing sponsor, except with respect to mutual self-help
housing, to submit an affirmative marketing program that meets
standards set forth in regulations of the agency. The agency shall
require such a housing sponsor to conduct the affirmative marketing
program so approved. Additionally, the agency shall supplement the
efforts of individual housing sponsors by conducting affirmative
marketing programs with respect to housing at the state level.
(b) Notwithstanding subdivision (a), with respect to familial
status, subdivision (a) shall not be construed to apply to housing
for older persons, as defined in Section 12955.9 of the Government
Code. With respect to familial status, nothing in subdivision (a)
shall be construed to affect Sections 51.2, 51.3, 51.4, 51.10, 51.11,
and 799.5 of the Civil Code, relating to housing for senior
citizens. Subdivision (d) of Section 51 and Section 1360
5760 of the Civil Code and subdivisions (n),
(o), and (p) of Section 12955 of the Government Code shall apply to
subdivision (a).
SEC. 75. Section 51602 of the Health and Safety Code is amended to
read:
51602. (a) The agency shall require that occupancy of housing for
which a loan is insured pursuant to this part shall be open to all
regardless of any basis listed in subdivision (a) or (d) of Section
12955 of the Government Code, as those bases are defined in Sections
12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p)
of Section 12955, and Section 12955.2 of the Government Code, and
that contractors and subcontractors engaged in the construction or
rehabilitation of housing funded by a loan insured pursuant to this
part shall provide an equal opportunity for employment without
discrimination as to any basis listed in subdivision (a) of Section
12940 of the Government Code, as those bases are defined in Sections
12926 and 12926.1 of the Government Code, and except as otherwise
provided in Section 12940 of the Government Code.
(b) Notwithstanding subdivision (a), with respect to familial
status, subdivision (a) shall not be construed to apply to housing
for older persons, as defined in Section 12955.9 of the Government
Code. With respect to familial status, nothing in subdivision (a)
shall be construed to affect Sections 51.2, 51.3, 51.4, 51.10, 51.11,
and 799.5 of the Civil Code, relating to housing for senior
citizens. Subdivision (d) of Section 51 and Section 1360
5760 of the Civil Code and subdivisions (n),
(o), and (p) of Section 12955 of the Government Code shall apply to
subdivision (a).
(c) A qualified developer shall certify compliance with this
section and Section 50955 according to requirements specified by the
pertinent criteria of the agency.
SEC. 76. Section 116048 of the Health and Safety Code is amended
to read:
116048. (a) On or after January 1, 1987, for a public
swimming pools pool open for use in
any common interest development, as defined in Section 1351
4100 of the Civil Code, that consists of fewer
than 25 separate interests, as defined in subdivision (
) of Section 1351 Section 4185
of the Civil Code, the person operating each such
the pool open for use shall
be required to keep a record of the information
required by subdivision (a) of Section 65523 of Title 22 of the
California Administrative Code California
Code of Regulations , except that the information shall be
recorded at least two times per week and at intervals no greater than
four days apart.
(b) On or after January 1, 1987, any rule or regulation of the
department that is in conflict with subdivision (a) is invalid.
SEC. 77. Section 790.031 of the Insurance Code is amended to read:
790.031. The requirements of subdivision (b) of Section 790.034,
and Sections 2071.1 and 10082.3 shall apply only to policies of
residential property insurance as defined in Section 10087, policies
and endorsements containing those coverages prescribed in Chapter 8.5
(commencing with Section 10081) of Part 1 of Division 2, policies
issued by the California Earthquake Authority pursuant to Chapter 8.6
(commencing with Section 10089.5) of Part 1 of Division 2, policies
and endorsements that insure against property damage and are issued
to common interest developments or to associations managing common
interest developments, as those terms are defined in Section
1351 Sections 4100 and 4080 of the Civil Code,
and to policies issued pursuant to Section 120 that insure against
property damage to residential units or contents thereof owned by one
or more persons located in this state.
SEC. 78. Section 2188.6 of the Revenue and Taxation Code is
amended to read:
2188.6. (a) Unless a request for exemption has been recorded
pursuant to subdivision (d), prior to the creation of a condominium
as defined in Section 783 of the Civil Code, the county assessor may
separately assess each individual unit which
that is shown on the condominium plan of a proposed condominium
project when all of the following documents have been recorded as
required by law:
(1) A subdivision final map or parcel map, as described in
Sections 66434 and 66445, respectively, of the Government Code.
(2) A condominium plan, as defined in subdivision (e) of
Section 1351 Section 4120 of the Civil Code.
(3) A declaration, as defined in subdivision (h) of
Section 1351 Section 4135 of the Civil Code.
(b) The tax due on each individual unit shall constitute a lien
solely on that unit.
(c) The lien created pursuant to this section shall be a lien on
an undivided interest in a portion of real property coupled with a
separate interest in space called a unit as described in
subdivision (f) of Section 1351 Section 4125 of
the Civil Code.
(d) The record owner of the real property may record with the
condominium plan a request that the real property be exempt from
separate assessment pursuant to this section. If a request for
exemption is recorded, separate assessment of a condominium unit
shall be made only in accordance with Section 2188.3.
(e) This section shall become operative on January 1, 1990, and
shall apply to condominium projects for which a condominium plan is
recorded after that date.
SEC. 79. Section 21107.7 of the Vehicle Code is amended to read:
21107.7. (a) Any city or county may, by ordinance or resolution,
find and declare that there are privately owned and maintained roads
as described in the ordinance or resolution within the city or county
that are not generally held open for use of the public for purposes
of vehicular travel but, by reason of their proximity to or
connection with highways, the interests of any residents residing
along the roads and the motoring public will best be served by
application of the provisions of this code to those roads. No
ordinance or resolution shall be enacted unless there is first filed
with the city or county a petition requesting it by a majority of the
owners of any privately owned and maintained road, or by at least a
majority of the board of directors of a common interest development,
as defined by Section 1351 4100 of the
Civil Code, that is responsible for maintaining the road, and without
a public hearing thereon and 10 days' prior written notice to all
owners of the road or all of the owners in the development. Upon
enactment of the ordinance or resolution, the provisions of this code
shall apply to the privately owned and maintained road if
appropriate signs are erected at the entrance to the road of the
size, shape, and color as to be readily legible during daylight hours
from a distance of 100 feet, to the effect that the road is subject
to the provisions of this code. The city or county may impose
reasonable conditions and may authorize the owners, or board of
directors of the common interest development, to erect traffic signs,
signals, markings, and devices which that
conform to the uniform standards and specifications adopted by
the Department of Transportation.
(b) The department shall not be required to provide patrol or
enforce any provisions of this code on any privately owned and
maintained road subjected to the provisions of this code under this
section, except those provisions applicable to private property other
than by action under this section.
(c) As used in this section, "privately owned and maintained roads"
includes roads owned and maintained by a city, county or district
that are not dedicated to use by the public or are not generally held
open for use of the public for purposes of vehicular travel.
SEC. 80. Section 22651 of the Vehicle Code, as amended by Chapter
749 of the Statutes of 2007, is amended to read:
22651. A peace officer, as defined in Chapter 4.5 (commencing
with Section 830) of Title 3 of Part 2 of the Penal Code, or a
regularly employed and salaried employee, who is engaged in directing
traffic or enforcing parking laws and regulations, of a city,
county, or jurisdiction of a state agency in which a vehicle is
located, may remove a vehicle located within the territorial limits
in which the officer or employee may act, under the following
circumstances:
(a) When a vehicle is left unattended upon a bridge, viaduct, or
causeway or in a tube or tunnel where the vehicle constitutes an
obstruction to traffic.
(b) When a vehicle is parked or left standing upon a highway in a
position so as to obstruct the normal movement of traffic or in a
condition so as to create a hazard to other traffic upon the highway.
(c) When a vehicle is found upon a highway or public land and a
report has previously been made that the vehicle is stolen or a
complaint has been filed and a warrant thereon is issued charging
that the vehicle is embezzled.
(d) When a vehicle is illegally parked so as to block the entrance
to a private driveway and it is impractical to move the vehicle from
in front of the driveway to another point on the highway.
(e) When a vehicle is illegally parked so as to prevent access by
firefighting equipment to a fire hydrant and it is impracticable to
move the vehicle from in front of the fire hydrant to another point
on the highway.
(f) When a vehicle, except a highway maintenance or construction
equipment, is stopped, parked, or left standing for more than four
hours upon the right-of-way of a freeway that has full control of
access and no crossings at grade and the driver, if present, cannot
move the vehicle under its own power.
(g) When the person in charge of a vehicle upon a highway or
public land is, by reason of physical injuries or illness,
incapacitated to an extent so as to be unable to provide for its
custody or removal.
(h) (1) When an officer arrests a person driving or in control of
a vehicle for an alleged offense and the officer is, by this code or
other law, required or permitted to take, and does take, the person
into custody.
(2) When an officer serves a notice of an order of suspension or
revocation pursuant to Section 13388 or 13389.
(i) (1) When a vehicle, other than a rented vehicle, is found upon
a highway or public land, or is removed pursuant to this code, and
it is known that the vehicle has been issued five or more notices of
parking violations to which the owner or person in control of the
vehicle has not responded within 21 calendar days of notice of
citation issuance or citation issuance or 14 calendar days of the
mailing of a notice of delinquent parking violation to the agency
responsible for processing notices of parking violation or the
registered owner of the vehicle is known to have been issued five or
more notices for failure to pay or failure to appear in court for
traffic violations for which a certificate has not been issued by the
magistrate or clerk of the court hearing the case showing that the
case has been adjudicated or concerning which the registered owner's
record has not been cleared pursuant to Chapter 6 (commencing with
Section 41500) of Division 17, the vehicle may be impounded until
that person furnishes to the impounding law enforcement agency all of
the following:
(A) Evidence of his or her identity.
(B) An address within this state at which he or she can be
located.
(C) Satisfactory evidence that all parking penalties due for the
vehicle and all other vehicles registered to the registered owner of
the impounded vehicle, and all traffic violations of the registered
owner, have been cleared.
(2) The requirements in subparagraph (C) of paragraph (1) shall be
fully enforced by the impounding law enforcement agency on and after
the time that the Department of Motor Vehicles is able to provide
access to the necessary records.
(3) A notice of parking violation issued for an unlawfully parked
vehicle shall be accompanied by a warning that repeated violations
may result in the impounding of the vehicle. In lieu of furnishing
satisfactory evidence that the full amount of parking penalties or
bail has been deposited, that person may demand to be taken without
unnecessary delay before a magistrate, for traffic offenses, or a
hearing examiner, for parking offenses, within the county in which
the offenses charged are alleged to have been committed and who has
jurisdiction of the offenses and is nearest or most accessible with
reference to the place where the vehicle is impounded. Evidence of
current registration shall be produced after a vehicle has been
impounded, or, at the discretion of the impounding law enforcement
agency, a notice to appear for violation of subdivision (a) of
Section 4000 shall be issued to that person.
(4) A vehicle shall be released to the legal owner, as defined in
Section 370, if the legal owner does all of the following:
(A) Pays the cost of towing and storing the vehicle.
(B) Submits evidence of payment of fees as provided in Section
9561.
(C) Completes an affidavit in a form acceptable to the impounding
law enforcement agency stating that the vehicle was not in possession
of the legal owner at the time of occurrence of the offenses
relating to standing or parking. A vehicle released to a legal owner
under this subdivision is a repossessed vehicle for purposes of
disposition or sale. The impounding agency shall have a lien on any
surplus that remains upon sale of the vehicle to which the registered
owner is or may be entitled, as security for the full amount of the
parking penalties for all notices of parking violations issued for
the vehicle and for all local administrative charges imposed pursuant
to Section 22850.5. The legal owner shall promptly remit to, and
deposit with, the agency responsible for processing notices of
parking violations from that surplus, on receipt of that surplus, the
full amount of the parking penalties for all notices of parking
violations issued for the vehicle and for all local administrative
charges imposed pursuant to Section 22850.5.
(5) The impounding agency that has a lien on the surplus that
remains upon the sale of a vehicle to which a registered owner is
entitled pursuant to paragraph (4) has a deficiency claim against the
registered owner for the full amount of the parking penalties for
all notices of parking violations issued for the vehicle and for all
local administrative charges imposed pursuant to Section 22850.5,
less the amount received from the sale of the vehicle.
(j) When a vehicle is found illegally parked and there are no
license plates or other evidence of registration displayed, the
vehicle may be impounded until the owner or person in control of the
vehicle furnishes the impounding law enforcement agency evidence of
his or her identity and an address within this state at which he or
she can be located.
(k) When a vehicle is parked or left standing upon a highway for
72 or more consecutive hours in violation of a local ordinance
authorizing removal.
() When a vehicle is illegally parked on a highway in violation of
a local ordinance forbidding standing or parking and the use of a
highway, or a portion thereof, is necessary for the cleaning, repair,
or construction of the highway, or for the installation of
underground utilities, and signs giving notice that the vehicle may
be removed are erected or placed at least 24 hours prior to the
removal by a local authority pursuant to the ordinance.
(m) Wherever the use of the highway, or a portion of the highway,
is authorized by a local authority for a purpose other than the
normal flow of traffic or for the movement of equipment, articles, or
structures of unusual size, and the parking of a vehicle would
prohibit or interfere with that use or movement, and signs giving
notice that the vehicle may be removed are erected or placed at least
24 hours prior to the removal by a local authority pursuant to the
ordinance.
(n) Whenever a vehicle is parked or left standing where local
authorities, by resolution or ordinance, have prohibited parking and
have authorized the removal of vehicles. A vehicle shall not be
removed unless signs are posted giving notice of the removal.
(o) (1) When a vehicle is found or operated upon a highway, public
land, or an offstreet parking facility under the following
circumstances:
(A) With a registration expiration date in excess of six months
before the date it is found or operated on the highway, public lands,
or the offstreet parking facility.
(B) Displaying in, or upon, the vehicle, a registration card,
identification card, temporary receipt, license plate, special plate,
registration sticker, device issued pursuant to Section 4853, or
permit that was not issued for that vehicle, or is not otherwise
lawfully used on that vehicle under this code.
(C) Displaying in, or upon, the vehicle, an altered, forged,
counterfeit, or falsified registration card, identification card,
temporary receipt, license plate, special plate, registration
sticker, device issued pursuant to Section 4853, or permit.
(2) When a vehicle described in paragraph (1) is occupied, only a
peace officer, as defined in Chapter 4.5 (commencing with Section
830) of Title 3 of Part 2 of the Penal Code, may remove the vehicle.
(3) For the purposes of this subdivision, the vehicle shall be
released to the owner or person in control of the vehicle only after
the owner or person furnishes the storing law enforcement agency with
proof of current registration and a currently valid driver's license
to operate the vehicle.
(4) As used in this subdivision, "offstreet parking facility" means
an offstreet facility held open for use by the public for parking
vehicles and includes a publicly owned facility for offstreet
parking, and privately owned facilities for offstreet parking where a
fee is not charged for the privilege to park and which are held open
for the common public use of retail customers.
(p) When the peace officer issues the driver of a vehicle a notice
to appear for a violation of Section 12500, 14601, 14601.1, 14601.2,
14601.3, 14601.4, 14601.5, or 14604 and the vehicle is not impounded
pursuant to Section 22655.5. A vehicle so removed from the highway
or public land, or from private property after having been on a
highway or public land, shall not be released to the registered owner
or his or her agent, except upon presentation of the registered
owner's or his or her agent's currently valid driver's license to
operate the vehicle and proof of current vehicle registration, or
upon order of a court.
(q) Whenever a vehicle is parked for more than 24 hours on a
portion of highway that is located within the boundaries of a common
interest development, as defined in subdivision (c) of
Section 1351 Section 4100 of the Civil Code, and
signs, as required by Section 22658.2, have been posted on that
portion of highway providing notice to drivers that vehicles parked
thereon for more than 24 hours will be removed at the owner's
expense, pursuant to a resolution or ordinance adopted by the local
authority.
(r) When a vehicle is illegally parked and blocks the movement of
a legally parked vehicle.
(s) (1) When a vehicle, except highway maintenance or construction
equipment, an authorized emergency vehicle, or a vehicle that is
properly permitted or otherwise authorized by the Department of
Transportation, is stopped, parked, or left standing for more than
eight hours within a roadside rest area or viewpoint.
(2) For purposes of this subdivision, a roadside rest area or
viewpoint is a publicly maintained vehicle parking area, adjacent to
a highway, utilized for the convenient, safe stopping of a vehicle to
enable motorists to rest or to view the scenery. If two or more
roadside rest areas are located on opposite sides of the highway, or
upon the center divider, within seven miles of each other, then that
combination of rest areas is considered to be the same rest area.
(t) When a peace officer issues a notice to appear for a violation
of Section 25279.
SEC. 81. Section 22651.05 of the Vehicle Code is amended to read:
22651.05. (a) A trained volunteer of a state or local law
enforcement agency, who is engaged in directing traffic or enforcing
parking laws and regulations, of a city, county, or jurisdiction of a
state agency in which a vehicle is located, may remove or authorize
the removal of a vehicle located within the territorial limits in
which an officer or employee of that agency may act, under any of the
following circumstances:
(1) When a vehicle is parked or left standing upon a highway for
72 or more consecutive hours in violation of a local ordinance
authorizing the removal.
(2) When a vehicle is illegally parked or left standing on a
highway in violation of a local ordinance forbidding standing or
parking and the use of a highway, or a portion thereof, is necessary
for the cleaning, repair, or construction of the highway, or for the
installation of underground utilities, and signs giving notice that
the vehicle may be removed are erected or placed at least 24 hours
prior to the removal by local authorities pursuant to the ordinance.
(3) Wherever the use of the highway, or a portion thereof, is
authorized by local authorities for a purpose other than the normal
flow of traffic or for the movement of equipment, articles, or
structures of unusual size, and the parking of a vehicle would
prohibit or interfere with that use or movement, and signs giving
notice that the vehicle may be removed are erected or placed at least
24 hours prior to the removal by local authorities pursuant to the
ordinance.
(4) Whenever a vehicle is parked or left standing where local
authorities, by resolution or ordinance, have prohibited parking and
have authorized the removal of vehicles. A vehicle may not be removed
unless signs are posted giving notice of the removal.
(5) Whenever a vehicle is parked for more than 24 hours on a
portion of highway that is located within the boundaries of a common
interest development, as defined in subdivision (c) of
Section 1351 Section 4100 of the Civil Code, and
signs, as required by Section 22658.2, have been posted on that
portion of highway providing notice to drivers that vehicles parked
thereon for more than 24 hours will be removed at the owner's
expense, pursuant to a resolution or ordinance adopted by the local
authority.
(b) The provisions of this chapter that apply to a vehicle removed
pursuant to Section 22651 apply to a vehicle removed pursuant to
subdivision (a).
(c) For purposes of subdivision (a), a "trained volunteer" is a
person who, of his or her own free will, provides services, without
any financial gain, to a local or state law enforcement agency, and
who is duly trained and certified to remove a vehicle by a local or
state law enforcement agency.
SEC. 82. Section 22658 of the Vehicle Code is amended to read:
22658. (a) The owner or person in lawful possession of private
property, including an association of a common interest development
, as defined in Section 1351
Sections 4080 and 4100 of the Civil Code, may cause the removal
of a vehicle parked on the property to a storage facility that meets
the requirements of subdivision (n) under any of the following
circumstances:
(1) There is displayed, in plain view at all entrances to the
property, a sign not less than 17 inches by 22 inches in size, with
lettering not less than one inch in height, prohibiting public
parking and indicating that vehicles will be removed at the owner's
expense, and containing the telephone number of the local traffic law
enforcement agency and the name and telephone number of each towing
company that is a party to a written general towing authorization
agreement with the owner or person in lawful possession of the
property. The sign may also indicate that a citation may also be
issued for the violation.
(2) The vehicle has been issued a notice of parking violation, and
96 hours have elapsed since the issuance of that notice.
(3) The vehicle is on private property and lacks an engine,
transmission, wheels, tires, doors, windshield, or any other major
part or equipment necessary to operate safely on the highways, the
owner or person in lawful possession of the private property has
notified the local traffic law enforcement agency, and 24 hours have
elapsed since that notification.
(4) The lot or parcel upon which the vehicle is parked is improved
with a single-family dwelling.
(b) The tow truck operator removing the vehicle, if the operator
knows or is able to ascertain from the property owner, person in
lawful possession of the property, or the registration records of the
Department of Motor Vehicles the name and address of the registered
and legal owner of the vehicle, shall immediately give, or cause to
be given, notice in writing to the registered and legal owner of the
fact of the removal, the grounds for the removal, and indicate the
place to which the vehicle has been removed. If the vehicle is stored
in a storage facility, a copy of the notice shall be given to the
proprietor of the storage facility. The notice provided for in this
section shall include the amount of mileage on the vehicle at the
time of removal and the time of the removal from the property. If the
tow truck operator does not know and is not able to ascertain the
name of the owner or for any other reason is unable to give the
notice to the owner as provided in this section, the tow truck
operator shall comply with the requirements of subdivision (c) of
Section 22853 relating to notice in the same manner as applicable to
an officer removing a vehicle from private property.
(c) This section does not limit or affect any right or remedy that
the owner or person in lawful possession of private property may
have by virtue of other provisions of law authorizing the removal of
a vehicle parked upon private property.
(d) The owner of a vehicle removed from private property pursuant
to subdivision (a) may recover for any damage to the vehicle
resulting from any intentional or negligent act of a person causing
the removal of, or removing, the vehicle.
(e) (1) An owner or person in lawful possession of private
property, or an association of a common interest development, causing
the removal of a vehicle parked on that property is liable for
double the storage or towing charges whenever there has been a
failure to comply with paragraph (1), (2), or (3) of subdivision (a)
or to state the grounds for the removal of the vehicle if requested
by the legal or registered owner of the vehicle as required by
subdivision (f).
(2) A property owner or owner's agent or lessee who causes the
removal of a vehicle parked on that property pursuant to the
exemption set forth in subparagraph (A) of paragraph (1) of
subdivision () and fails to comply with that subdivision is guilty of
an infraction, punishable by a fine of one thousand dollars
($1,000).
(f) An owner or person in lawful possession of private property,
or an association of a common interest development, causing the
removal of a vehicle parked on that property shall notify by
telephone or, if impractical, by the most expeditious means
available, the local traffic law enforcement agency within one hour
after authorizing the tow. An owner or person in lawful possession of
private property, an association of a common interest development,
causing the removal of a vehicle parked on that property, or the tow
truck operator who removes the vehicle, shall state the grounds for
the removal of the vehicle if requested by the legal or registered
owner of that vehicle. A towing company that removes a vehicle from
private property in compliance with subdivision (l) is not
responsible in a situation relating to the validity of the removal. A
towing company that removes the vehicle under this section shall be
responsible for the following:
(1) Damage to the vehicle in the transit and subsequent storage of
the vehicle.
(2) The removal of a vehicle other than the vehicle specified by
the owner or other person in lawful possession of the private
property.
(g) (1) (A) Possession of a vehicle under this section shall be
deemed to arise when a vehicle is removed from private property and
is in transit.
(B) Upon the request of the owner of the vehicle or that owner's
agent, the towing company or its driver shall immediately and
unconditionally release a vehicle that is not yet removed from the
private property and in transit.
(C) A person failing to comply with subparagraph (B) is guilty of
a misdemeanor.
(2) If a vehicle is released to a person in compliance with
subparagraph (B) of paragraph (1), the vehicle owner or authorized
agent shall immediately move that vehicle to a lawful location.
(h) A towing company may impose a charge of not more than one-half
of the regular towing charge for the towing of a vehicle at the
request of the owner, the owner's agent, or the person in lawful
possession of the private property pursuant to this section if the
owner of the vehicle or the vehicle owner's agent returns to the
vehicle after the vehicle is coupled to the tow truck by means of a
regular hitch, coupling device, drawbar, portable dolly, or is lifted
off the ground by means of a conventional trailer, and before it is
removed from the private property. The regular towing charge may only
be imposed after the vehicle has been removed from the property and
is in transit.
(i) (1) (A) A charge for towing or storage, or both, of a vehicle
under this section is excessive if the charge exceeds the greater of
the following:
(i) That which would have been charged for that towing or storage,
or both, made at the request of a law enforcement agency under an
agreement between a towing company and the law enforcement agency
that exercises primary jurisdiction in the city in which is located
the private property from which the vehicle was, or was attempted to
be, removed, or if the private property is not located within a city,
then the law enforcement agency that exercises primary jurisdiction
in the county in which the private property is located.
(ii) That which would have been charged for that towing or
storage, or both, under the rate approved for that towing operator by
the California Highway Patrol for the jurisdiction in which the
private property is located and from which the vehicle was, or was
attempted to be, removed.
(B) A towing operator shall make available for inspection and
copying his or her rate approved by the California Highway Patrol, if
any, with in within 24 hours of a
request without a warrant to law enforcement, the Attorney General,
district attorney, or city attorney.
(2) If a vehicle is released within 24 hours from the time the
vehicle is brought into the storage facility, regardless of the
calendar date, the storage charge shall be for only one day. Not more
than one day's storage charge may be required for a vehicle released
the same day that it is stored.
(3) If a request to release a vehicle is made and the appropriate
fees are tendered and documentation establishing that the person
requesting release is entitled to possession of the vehicle, or is
the owner's insurance representative, is presented within the initial
24 hours of storage, and the storage facility fails to comply with
the request to release the vehicle or is not open for business during
normal business hours, then only one day's storage charge may be
required to be paid until after the first business day. A business
day is any day in which the lienholder is open for business to the
public for at least eight hours. If a request is made more than 24
hours after the vehicle is placed in storage, charges may be imposed
on a full calendar day basis for each day, or part thereof, that the
vehicle is in storage.
(j) (1) A person who charges a vehicle owner a towing, service, or
storage charge at an excessive rate, as described in subdivision (h)
or (i), is civilly liable to the vehicle owner for four times the
amount charged.
(2) A person who knowingly charges a vehicle owner a towing,
service, or storage charge at an excessive rate, as described in
subdivision (h) or (i), or who fails to make available his or her
rate as required in subparagraph (B) of paragraph (1) of subdivision
(i), is guilty of a misdemeanor, punishable by a fine of not more
than two thousand five hundred dollars ($2,500), or by imprisonment
in the county jail for not more than three months, or by both that
fine and imprisonment.
(k) (1) A person operating or in charge of a storage facility
where vehicles are stored pursuant to this section shall accept a
valid credit card or cash for payment of towing and storage by a
registered owner or the owner's agent claiming the vehicle. "Credit
card" means "credit card" as defined in subdivision (a) of Section
1747.02 of the Civil Code, except for the purposes of this section,
credit card does not include a credit card issued by a retail seller.
(2) A person described in paragraph (1) shall conspicuously
display, in that portion of the storage facility office where
business is conducted with the public, a notice advising that all
valid credit cards and cash are acceptable means of payment.
(3) A person operating or in charge of a storage facility who
refuses to accept a valid credit card or who fails to post the
required notice under paragraph (2) is guilty of a misdemeanor,
punishable by a fine of not more than two thousand five hundred
dollars ($2,500), or by imprisonment in the county jail for not more
than three months, or by both that fine and imprisonment.
(4) A person described in paragraph (1) who violates paragraph (1)
or (2) is civilly liable to the registered owner of the vehicle or
the person who tendered the fees for four times the amount of the
towing and storage charges.
(5) A person operating or in charge of the storage facility shall
have sufficient moneys on the premises of the primary storage
facility during normal business hours to accommodate, and make change
in, a reasonable monetary transaction.
(6) Credit charges for towing and storage services shall comply
with Section 1748.1 of the Civil Code. Law enforcement agencies may
include the costs of providing for payment by credit when making
agreements with towing companies as described in subdivision (i).
(l) (1) (A) A towing company shall not remove or commence the
removal of a vehicle from private property without first obtaining
the written authorization from the property owner or lessee,
including an association of a common interest development, or an
employee or agent thereof, who shall be present at the time of
removal and verify the alleged violation, except that presence and
verification is not required if the person authorizing the tow is the
property owner, or the owner's agent who is not a tow operator, of a
residential rental property of 15 or fewer units that does not have
an onsite owner, owner's agent or employee, and the tenant has
verified the violation, requested the tow from that tenant's assigned
parking space, and provided a signed request or electronic mail, or
has called and provides a signed request or electronic mail within 24
hours, to the property owner or owner's agent, which the owner or
agent shall provide to the towing company within 48 hours of
authorizing the tow. The signed request or electronic mail shall
contain the name and address of the tenant, and the date and time the
tenant requested the tow. A towing company shall obtain within 48
hours of receiving the written authorization to tow a copy of a
tenant request required pursuant to this subparagraph. For the
purpose of this subparagraph, a person providing the written
authorization who is required to be present on the private property
at the time of the tow does not have to be physically present at the
specified location of where the vehicle to be removed is located on
the private property.
(B) The written authorization under subparagraph (A) shall include
all of the following:
(i) The make, model, vehicle identification number, and license
plate number of the removed vehicle.
(ii) The name, signature, job title, residential or business
address and working telephone number of the person, described in
subparagraph (A), authorizing the removal of the vehicle.
(iii) The grounds for the removal of the vehicle.
(iv) The time when the vehicle was first observed parked at the
private property.
(v) The time that authorization to tow the vehicle was given.
(C) (i) When the vehicle owner or his or her agent claims the
vehicle, the towing company prior to payment of a towing or storage
charge shall provide a photocopy of the written authorization to the
vehicle owner or the agent.
(ii) If the vehicle was towed from a residential property, the
towing company shall redact the information specified in clause (ii)
of subparagraph (B) in the photocopy of the written authorization
provided to the vehicle owner or the agent pursuant to clause (i).
(iii) The towing company shall also provide to the vehicle owner
or the agent a separate notice that provides the telephone number of
the appropriate local law enforcement or prosecuting agency by
stating "If you believe that you have been wrongfully towed, please
contact the local law enforcement or prosecuting agency at (insert
appropriate telephone number)." The notice shall be in English and in
the most populous language, other than English, that is spoken in
the jurisdiction.
(D) A towing company shall not remove or commence the removal of a
vehicle from private property described in subdivision (a) of
Section 22953 unless the towing company has made a good faith inquiry
to determine that the owner or the property owner's agent complied
with Section 22953.
(E) (i) General authorization to remove or commence removal of a
vehicle at the towing company's discretion shall not be delegated to
a towing company or its affiliates except in the case of a vehicle
unlawfully parked within 15 feet of a fire hydrant or in a fire lane,
or in a manner which interferes with an entrance to, or exit from,
the private property.
(ii) In those cases in which general authorization is granted to a
towing company or its affiliate to undertake the removal or commence
the removal of a vehicle that is unlawfully parked within 15 feet of
a fire hydrant or in a fire lane, or that interferes with an
entrance to, or exit from, private property, the towing company and
the property owner, or owner's agent, or person in lawful possession
of the private property shall have a written agreement granting that
general authorization.
(2) If a towing company removes a vehicle under a general
authorization described in subparagraph (E) of paragraph (1) and that
vehicle is unlawfully parked within 15 feet of a fire hydrant or in
a fire lane, or in a manner that interferes with an entrance to, or
exit from, the private property, the towing company shall take, prior
to the removal of that vehicle, a photograph of the vehicle that
clearly indicates that parking violation. Prior to accepting payment,
the towing company shall keep one copy of the photograph taken
pursuant to this paragraph, and shall present that photograph and
provide, without charge, a photocopy to the owner or an agent of the
owner, when that person claims the vehicle.
(3) A towing company shall maintain the original written
authorization, or the general authorization described in subparagraph
(E) of paragraph (1) and the photograph of the violation, required
pursuant to this section, and any written requests from a tenant to
the property owner or owner's agent required by subparagraph (A) of
paragraph (1), for a period of three years and shall make them
available for inspection and copying within 24 hours of a request
without a warrant to law enforcement, the Attorney General, district
attorney, or city attorney.
(4) A person who violates this subdivision is guilty of a
misdemeanor, punishable by a fine of not more than two thousand five
hundred dollars ($2,500), or by imprisonment in the county jail for
not more than three months, or by both that fine and imprisonment.
(5) A person who violates this subdivision is civilly liable to
the owner of the vehicle or his or her agent for four times the
amount of the towing and storage charges.
(m) (1) A towing company that removes a vehicle from private
property under this section shall notify the local law enforcement
agency of that tow after the vehicle is removed from the private
property and is in transit.
(2) A towing company is guilty of a misdemeanor if the towing
company fails to provide the notification required under paragraph
(1) within 60 minutes after the vehicle is removed from the private
property and is in transit or 15 minutes after arriving at the
storage facility, whichever time is less.
(3) A towing company that does not provide the notification under
paragraph (1) within 30 minutes after the vehicle is removed from the
private property and is in transit is civilly liable to the
registered owner of the vehicle, or the person who tenders the fees,
for three times the amount of the towing and storage charges.
(4) If notification is impracticable, the times for notification,
as required pursuant to paragraphs (2) and (3), shall be tolled for
the time period that notification is impracticable. This paragraph is
an affirmative defense.
(n) A vehicle removed from private property pursuant to this
section shall be stored in a facility that meets all of the following
requirements:
(1) (A) Is located within a 10-mile radius of the property from
where the vehicle was removed.
(B) The 10-mile radius requirement of subparagraph (A) does not
apply if a towing company has prior general written approval from the
law enforcement agency that exercises primary jurisdiction in the
city in which is located the private property from which the vehicle
was removed, or if the private property is not located within a city,
then the law enforcement agency that exercises primary jurisdiction
in the county in which is located the private property.
(2) (A) Remains open during normal business hours and releases
vehicles after normal business hours.
(B) A gate fee may be charged for releasing a vehicle after normal
business hours, weekends, and state holidays. However, the maximum
hourly charge for releasing a vehicle after normal business hours
shall be one-half of the hourly tow rate charged for initially towing
the vehicle, or less.
(C) Notwithstanding any other provision of law and for purposes of
this paragraph, "normal business hours" are Monday to Friday,
inclusive, from 8 a.m. to 5 p.m., inclusive, except state holidays.
(3) Has a public pay telephone in the office area that is open and
accessible to the public.
(o) (1) It is the intent of the Legislature in the adoption of
subdivision (k) to assist vehicle owners or their agents by, among
other things, allowing payment by credit cards for towing and storage
services, thereby expediting the recovery of towed vehicles and
concurrently promoting the safety and welfare of the public.
(2) It is the intent of the Legislature in the adoption of
subdivision (l) to further the safety of the general public by
ensuring that a private property owner or lessee has provided his or
her authorization for the removal of a vehicle from his or her
property, thereby promoting the safety of those persons involved in
ordering the removal of the vehicle as well as those persons
removing, towing, and storing the vehicle.
(3) It is the intent of the Legislature in the adoption of
subdivision (g) to promote the safety of the general public by
requiring towing companies to unconditionally release a vehicle that
is not lawfully in their possession, thereby avoiding the likelihood
of dangerous and violent confrontation and physical injury to vehicle
owners and towing operators, the stranding of vehicle owners and
their passengers at a dangerous time and location, and impeding
expedited vehicle recovery, without wasting law enforcement's limited
resources.
(p) The remedies, sanctions, restrictions, and procedures
provided in this section are not exclusive and are in addition to
other remedies, sanctions, restrictions, or procedures that may be
provided in other provisions of law, including, but not limited to,
those that are provided in Sections 12110 and 34660.
SEC. 83. This act shall become operative on January 1, 2010.