BILL NUMBER: AB 2273 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY MAY 14, 2012
AMENDED IN ASSEMBLY APRIL 26, 2012
AMENDED IN ASSEMBLY APRIL 16, 2012
INTRODUCED BY Assembly Member Wieckowski
( Coauthor: Assembly Member
Dickinson )
FEBRUARY 24, 2012
An act to amend Section 1368 2924b
of, and to add Section 2924.1 to, the Civil Code, relating to common
interest developments.
LEGISLATIVE COUNSEL'S DIGEST
AB 2273, as amended, Wieckowski. Common interest developments:
required documents.
(1) The Davis-Stirling Common Interest Development Act requires an
owner of a separate interest in a common interest development to
provide specified documents to a prospective purchaser of that
interest. Existing law requires a homeowners' association to provide
these documents to the owner of the separate interest within 10 days
of the mailing or delivery of the request, and limits the amount of
fees charged for the provision of the documents to the association's
actual costs to procure, prepare, and reproduce the requested
documents.
This bill would additionally provide that an acquiring owner of a
separate interest shall provide to the association's board secretary,
agent, manager, or designated representative a written notice of the
acquiring owner's mailing address within 30 days of receiving title,
except as specified.
(2)
The Davis-Stirling Common Interest Development Act provides
for the creation and regulation of common interest developments.
Under existing law, a common interest development is managed by an
association pursuant to the provisions of the governing documents of
the development. Existing law also imposes various
requirements that must be satisfied prior to exercising a power of
sale under a mortgage or deed of trust.
This bill would, notwithstanding any other law, impose
certain requirements on the require the transfer,
following the sale , of a property in a common
interest development, as defined, executed under a power of sale
contained in any deed of trust or mortgage . Among other
things, the bill would require the sale to take place in the county
where the property or a portion of the property is located, and would
also require the sale to be recorded within 30 days, as
specified.
This bill would also make the purchaser, as specified, liable for
the amount of certain unpaid liens recorded on the property if the
sale is not recorded as described above. The bill would specify that
these provisions would only apply if the purchaser is also the person
or entity that exercised the power of sale on the property.
Existing law requires a trustee or mortgagee to record a notice of
default and to post and publish a notice of sale prior to selling
real property at a foreclosure sale. Existing law allows an
association, with respect to separate interests governed by the
association, to record a single request that a mortgagee, trustee, or
other person authorized to record a notice of default regarding any
of those separate interests mail to the association a copy of any
trustee's deed upon sale concerning a separate interest, as
specified. Existing law requires that the information requested by
the association be mailed within 15 business days following the date
the trustee's deed is recorded.
This bill would instead require that the requested information
described above be mailed to the association within 15 business days
following the date of the trustee's sale.
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 1368 of the Civil Code is
amended to read:
1368. (a) The owner of a separate interest, other than an owner
subject to the requirements of Section 11018.6 of the Business and
Professions Code, shall, as soon as practicable before transfer of
title to the separate interest or execution of a real property sales
contract therefor, as defined in Section 2985, provide the following
to the prospective purchaser:
(1) A copy of the governing documents of the common interest
development, including any operating rules, and including a copy of
the association's articles of incorporation, or, if not incorporated,
a statement in writing from an authorized representative of the
association that the association is not incorporated.
(2) If there is a restriction in the governing documents limiting
the occupancy, residency, or use of a separate interest on the basis
of age in a manner different from that provided in Section 51.3, a
statement that the restriction is only enforceable to the extent
permitted by Section 51.3 and a statement specifying the applicable
provisions of Section 51.3.
(3) A copy of the most recent documents distributed pursuant to
Section 1365.
(4) 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 Section 1367 or 1367.1.
(5) A copy or a summary of any notice previously sent to the owner
pursuant to subdivision (h) of Section 1363 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.
(6) A copy of the initial list of defects provided to each member
of the association pursuant to Section 1375, unless the association
and the builder subsequently enter into a settlement agreement or
otherwise resolve the matter and the association complies with
Section 1375.1. Disclosure of the initial list of defects pursuant to
this paragraph does not waive any privilege attached to the
document. The initial 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.
(7) A copy of the latest information provided for in Section
1375.1.
(8) Any change in the association's current regular and special
assessments and fees which 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.
(9) If there is a provision in the governing documents that
prohibits the rental or leasing of any of the separate interests in
the common interest development to a renter, lessee, or tenant, a
statement describing the prohibition and its applicability.
(10) If requested by the prospective purchaser, a copy of the
minutes of the meetings, excluding meetings held in executive
session, of the association's board of directors, conducted over the
previous 12 months, that were approved by the association's board of
directors.
(b) (1) Upon written request, the association shall, within 10
days of the mailing or delivery of the request, provide the owner of
a separate interest, or any other recipient authorized by the owner,
with a copy of the requested documents specified in paragraphs (1) to
(10), inclusive, of subdivision (a). Upon receipt of a written
request, the association shall provide, on the form described in
Section 1368.2, a written or electronic estimate of the fees that
will be assessed for providing the requested documents. The documents
required to be made available pursuant to this section may be
maintained in electronic form, and may be posted on the association's
Internet Web site. Requesting parties shall have the option of
receiving the documents by electronic transmission if the association
maintains the documents in electronic form. The association may
collect a reasonable fee based upon the association's actual cost for
the procurement, preparation, reproduction, and delivery of the
documents requested pursuant to the provisions of this section.
(2) No additional fees may be charged by the association for the
electronic delivery of the documents requested.
(3) Fees for any documents required by this section shall be
distinguished from other fees, fines, or assessments billed as part
of the transfer or sales transaction. Delivery of the documents
required by this section shall not be withheld for any reason nor
subject to any condition except the payment of the fee allowed
pursuant to paragraph (1).
(4) An association may contract with any person or entity to
facilitate compliance with the requirements of this subdivision on
behalf of the association.
(5) The association shall also provide a recipient authorized by
the owner of a separate interest with a copy of the completed form
specified in Section 1368.2 at the time the required documents are
delivered.
(c) (1) Unless the association notifies the acquiring owner of a
separate interest that the association acknowledges a transfer of
title, the acquiring owner shall provide written notice of the
acquiring owner's mailing address to the association's board
secretary, agent, manager, or designated representative within 30
days of receiving title.
(2) This subdivision shall not apply to an owner, subdivider, or
agent subject to the requirements of Section 11018.6 of the Business
and Professions Code.
(d) (1) Except as provided in paragraph (2), neither an
association nor a community service organization or similar entity
may 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) An amount authorized by subdivision (b).
(2) The prohibition in paragraph (1) does not apply to a community
service organization or similar entity, or to a nonprofit entity
that provides services to a common interest development under a
declaration of trust, that is described in subparagraph (A) or (B):
(A) The community service organization or similar entity satisfies
both of the following requirements:
(i) The community service organization or similar entity was
established prior to February 20, 2003.
(ii) The community service organization or similar entity 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) The community service organization or similar entity, or a
nonprofit entity that provides services to a common interest
development under a declaration of trust, satisfies all of the
following requirements:
(i) The organization or entity is not an organization or entity
described in subparagraph (A).
(ii) The organization or entity was established and received a
transfer fee prior to January 1, 2004.
(iii) On and after January 1, 2006, the organization or entity
offers a purchaser the following payment options for the fee or
charge it collects at time of transfer:
(I) Paying the fee or charge at the time of transfer.
(II) 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
organization or 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, he or she shall pay the
remaining balance prior to transfer.
(3) For the purposes of this subdivision, a "community service
organization or similar entity" means a nonprofit entity, other than
an association, that is organized to provide services to residents of
the common interest development or to the public in addition to the
residents, to the extent community common areas or facilities are
available to the public. A "community service organization or similar
entity" 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.
(e) Any person or entity who willfully violates this section is
liable to the purchaser of a separate interest that is subject to
this section for actual damages occasioned thereby 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.
(f) Nothing in this section affects the validity of title to real
property transferred in violation of this section.
(g) In addition to the requirements of this section, an owner
transferring title to a separate interest shall comply with
applicable requirements of Sections 1133 and 1134.
(h) For the purposes of this section, a person who acts as a
community association manager is an agent, as defined in Section
2297, of the association.
SEC. 2. SECTION 1. Section 2924.1 is
added to the Civil Code, to read:
2924.1. (a) Notwithstanding any other law, a
the transfer, following the sale , of property
in a common interest development, as defined by Section 1351,
executed under the power of sale contained in any deed of trust or
mortgage , shall meet all of the following
requirements: be recorded within 30 days after the
date of sale in the office of the county recorder where the property
or a portion of the property is located.
(1) The sale shall take place in the county where the property or
a portion of the property is located.
(2) The sale shall be made to the highest bidder at an auction to
be held Monday through Friday, between the hours of 9 a.m. and 5 p.m.
(3) The sale shall be recorded within 30 days after the date of
sale in the office of the county recorder where the property or a
portion of the property is located.
(b) (1) If the sale is not recorded pursuant to paragraph (3) of
subdivision (a), the purchaser shall be liable for the amount of all
liens recorded pursuant to Section 1367 or 1367.1 on the foreclosed
property.
(2) This subdivision shall only apply if the purchaser is also the
person or entity that exercised the power of sale on the property.
(c)
(b) Any failure to comply with the provisions of this
section shall not affect the validity of a sale in favor of a bona
fide purchaser.
SEC. 2. Section 2924b of the Civil Code
is amended to read:
2924b. (a) Any person desiring a copy of any notice of default
and of any notice of sale under any deed of trust or mortgage with
power of sale upon real property or an estate for years therein, as
to which deed of trust or mortgage the power of sale cannot be
exercised until these notices are given for the time and in the
manner provided in Section 2924 may, at any time subsequent to
recordation of the deed of trust or mortgage and prior to recordation
of notice of default thereunder, cause to be filed for record in the
office of the recorder of any county in which any part or parcel of
the real property is situated, a duly acknowledged request for a copy
of the notice of default and of sale. This request shall be signed
and acknowledged by the person making the request, specifying the
name and address of the person to whom the notice is to be mailed,
shall identify the deed of trust or mortgage by stating the names of
the parties thereto, the date of recordation thereof, and the book
and page where the deed of trust or mortgage is recorded or the
recorder's number, and shall be in substantially the following form:
""In accordance with Section 2924b, Civil Code,
request is hereby
made that a copy of any notice of default and a
copy of any notice of sale
under the deed of trust (or mortgage) recorded
______, ____, in Book
_____ page ____ records of ____ County, (or filed
for record with
recorder's serial number ____, _______ County)
California, executed
by ____ as trustor (or mortgagor) in which
________ is named as
beneficiary (or mortgagee) and
______________ as trustee be mailed to
_________________ at __________________________.
Name Address
NOTICE: A copy of any notice of default and of
any notice of sale will be
sent only to the address contained in this
recorded request. If your address changes, a new
request must be recorded.
Signature ______________''
Upon the filing for record of the request, the recorder shall
index in the general index of grantors the names of the trustors (or
mortgagor) recited therein and the names of persons requesting
copies.
(b) The mortgagee, trustee, or other person authorized to record
the notice of default or the notice of sale shall do each of the
following:
(1) Within 10 business days following recordation of the notice of
default, deposit or cause to be deposited in the United States mail
an envelope, sent by registered or certified mail with postage
prepaid, containing a copy of the notice with the recording date
shown thereon, addressed to each person whose name and address are
set forth in a duly recorded request therefor, directed to the
address designated in the request and to each trustor or mortgagor at
his or her last known address if different than the address
specified in the deed of trust or mortgage with power of sale.
(2) At least 20 days before the date of sale, deposit or cause to
be deposited in the United States mail an envelope, sent by
registered or certified mail with postage prepaid, containing a copy
of the notice of the time and place of sale, addressed to each person
whose name and address are set forth in a duly recorded request
therefor, directed to the address designated in the request and to
each trustor or mortgagor at his or her last known address if
different than the address specified in the deed of trust or mortgage
with power of sale.
(3) As used in paragraphs (1) and (2), the "last known address" of
each trustor or mortgagor means the last business or residence
physical address actually known by the mortgagee, beneficiary,
trustee, or other person authorized to record the notice of default.
For the purposes of this subdivision, an address is "actually known"
if it is contained in the original deed of trust or mortgage, or in
any subsequent written notification of a change of physical address
from the trustor or mortgagor pursuant to the deed of trust or
mortgage. For the purposes of this subdivision, "physical address"
does not include an e-mail or any form of electronic address for a
trustor or mortgagor. The beneficiary shall inform the trustee of the
trustor's last address actually known by the beneficiary. However,
the trustee shall incur no liability for failing to send any notice
to the last address unless the trustee has actual knowledge of it.
(4) A "person authorized to record the notice of default or the
notice of sale" shall include an agent for the mortgagee or
beneficiary, an agent of the named trustee, any person designated in
an executed substitution of trustee, or an agent of that substituted
trustee.
(c) The mortgagee, trustee, or other person authorized to record
the notice of default or the notice of sale shall do the following:
(1) Within one month following recordation of the notice of
default, deposit or cause to be deposited in the United States mail
an envelope, sent by registered or certified mail with postage
prepaid, containing a copy of the notice with the recording date
shown thereon, addressed to each person set forth in paragraph (2),
provided that the estate or interest of any person entitled to
receive notice under this subdivision is acquired by an instrument
sufficient to impart constructive notice of the estate or interest in
the land or portion thereof that is subject to the deed of trust or
mortgage being foreclosed, and provided the instrument is recorded in
the office of the county recorder so as to impart that constructive
notice prior to the recording date of the notice of default and
provided the instrument as so recorded sets forth a mailing address
that the county recorder shall use, as instructed within the
instrument, for the return of the instrument after recording, and
which address shall be the address used for the purposes of mailing
notices herein.
(2) The persons to whom notice shall be mailed under this
subdivision are:
(A) The successor in interest, as of the recording date of the
notice of default, of the estate or interest or any portion thereof
of the trustor or mortgagor of the deed of trust or mortgage being
foreclosed.
(B) The beneficiary or mortgagee of any deed of trust or mortgage
recorded subsequent to the deed of trust or mortgage being
foreclosed, or recorded prior to or concurrently with the deed of
trust or mortgage being foreclosed but subject to a recorded
agreement or a recorded statement of subordination to the deed of
trust or mortgage being foreclosed.
(C) The assignee of any interest of the beneficiary or mortgagee
described in subparagraph (B), as of the recording date of the notice
of default.
(D) The vendee of any contract of sale, or the lessee of any
lease, of the estate or interest being foreclosed that is recorded
subsequent to the deed of trust or mortgage being foreclosed, or
recorded prior to or concurrently with the deed of trust or mortgage
being foreclosed but subject to a recorded agreement or statement of
subordination to the deed of trust or mortgage being foreclosed.
(E) The successor in interest to the vendee or lessee described in
subparagraph (D), as of the recording date of the notice of default.
(F) The office of the Controller, Sacramento, California, where,
as of the recording date of the notice of default, a "Notice of Lien
for Postponed Property Taxes" has been recorded against the real
property to which the notice of default applies.
(3) At least 20 days before the date of sale, deposit or cause to
be deposited in the United States mail an envelope, sent by
registered or certified mail with postage prepaid, containing a copy
of the notice of the time and place of sale addressed to each person
to whom a copy of the notice of default is to be mailed as provided
in paragraphs (1) and (2), and addressed to the office of any state
taxing agency, Sacramento, California, that has recorded, subsequent
to the deed of trust or mortgage being foreclosed, a notice of tax
lien prior to the recording date of the notice of default against the
real property to which the notice of default applies.
(4) Provide a copy of the notice of sale to the Internal Revenue
Service, in accordance with Section 7425 of the Internal Revenue Code
and any applicable federal regulation, if a "Notice of Federal Tax
Lien under Internal Revenue Laws" has been recorded, subsequent to
the deed of trust or mortgage being foreclosed, against the real
property to which the notice of sale applies. The failure to provide
the Internal Revenue Service with a copy of the notice of sale
pursuant to this paragraph shall be sufficient cause to rescind the
trustee's sale and invalidate the trustee's deed, at the option of
either the successful bidder at the trustee's sale or the trustee,
and in either case with the consent of the beneficiary. Any option to
rescind the trustee's sale pursuant to this paragraph shall be
exercised prior to any transfer of the property by the successful
bidder to a bona fide purchaser for value. A recision of the trustee'
s sale pursuant to this paragraph may be recorded in a notice of
recision pursuant to Section 1058.5.
(5) The mailing of notices in the manner set forth in paragraph
(1) shall not impose upon any licensed attorney, agent, or employee
of any person entitled to receive notices as herein set forth any
duty to communicate the notice to the entitled person from the fact
that the mailing address used by the county recorder is the address
of the attorney, agent, or employee.
(d) Any deed of trust or mortgage with power of sale hereafter
executed upon real property or an estate for years therein may
contain a request that a copy of any notice of default and a copy of
any notice of sale thereunder shall be mailed to any person or party
thereto at the address of the person given therein, and a copy of any
notice of default and of any notice of sale shall be mailed to each
of these at the same time and in the same manner required as though a
separate request therefor had been filed by each of these persons as
herein authorized. If any deed of trust or mortgage with power of
sale executed after September 19, 1939, except a deed of trust or
mortgage of any of the classes excepted from the provisions of
Section 2924, does not contain a mailing address of the trustor or
mortgagor therein named, and if no request for special notice by the
trustor or mortgagor in substantially the form set forth in this
section has subsequently been recorded, a copy of the notice of
default shall be published once a week for at least four weeks in a
newspaper of general circulation in the county in which the property
is situated, the publication to commence within 10 business days
after the filing of the notice of default. In lieu of publication, a
copy of the notice of default may be delivered personally to the
trustor or mortgagor within the 10 business days or at any time
before publication is completed, or by posting the notice of default
in a conspicuous place on the property and mailing the notice to the
last known address of the trustor or mortgagor.
(e) Any person required to mail a copy of a notice of default or
notice of sale to each trustor or mortgagor pursuant to subdivision
(b) or (c) by registered or certified mail shall simultaneously cause
to be deposited in the United States mail, with postage prepaid and
mailed by first-class mail, an envelope containing an additional copy
of the required notice addressed to each trustor or mortgagor at the
same address to which the notice is sent by registered or certified
mail pursuant to subdivision (b) or (c). The person shall execute and
retain an affidavit identifying the notice mailed, showing the name
and residence or business address of that person, that he or she is
over the age of 18 years, the date of deposit in the mail, the name
and address of the trustor or mortgagor to whom sent, and that the
envelope was sealed and deposited in the mail with postage fully
prepaid. In the absence of fraud, the affidavit required by this
subdivision shall establish a conclusive presumption of mailing.
(f) (1) Notwithstanding subdivision (a), with respect to separate
interests governed by an association, as defined in subdivision (a)
of Section 1351, the association may cause to be filed in the office
of the recorder in the county in which the separate interests are
situated a request that a mortgagee, trustee, or other person
authorized to record a notice of default regarding any of those
separate interests mail to the association a copy of any trustee's
deed upon sale concerning a separate interest. The request shall
include a legal description or the assessor's parcel number of all
the separate interests. A request recorded pursuant to this
subdivision shall include the name and address of the association and
a statement that it is a homeowners' association. Subsequent
requests of an association shall supersede prior requests. A request
pursuant to this subdivision shall be recorded before the filing of a
notice of default. The mortgagee, trustee, or other authorized
person shall mail the requested information to the association within
15 business days following the date of the trustee's
deed is recorded sale . Failure to mail
the request, pursuant to this subdivision, shall not affect the
title to real property.
(2) A request filed pursuant to paragraph (1) does not, for
purposes of Section 27288.1 of the Government Code, constitute a
document that either effects or evidences a transfer or encumbrance
of an interest in real property or that releases or terminates any
interest, right, or encumbrance of an interest in real property.
(g) No request for a copy of any notice filed for record pursuant
to this section, no statement or allegation in the request, and no
record thereof shall affect the title to real property or be deemed
notice to any person that any person requesting copies of notice has
or claims any right, title, or interest in, or lien or charge upon
the property described in the deed of trust or mortgage referred to
therein.
(h) "Business day," as used in this section, has the meaning
specified in Section 9.