Simply the Best

Simply the Best

[As Published in the January-February 2019 issue of “Common Ground,” the magazine of CAI] A community association is no better than the board of directors who leads it. The board serves as the community’s voice and guide. If an association is to be excellent, willing volunteers must be developed. Truly exceptional volunteer governance is not a happy accident, and it often has little to do with a volunteer’s background, training, and experience. Instead, it is the result of hard work and the pursuit of proper values, foundational understandings, and perspectives. Have the right attitude Excellent board members understand that their position is one of service rather than control. They serve their neighbors; they don’t supervise them. A service-forward attitude results in a less defensive perspective in which new ideas and opinions are welcomed and not perceived as insults or threats. The best know that board service is not an accomplishment or distinction to be defended and preserved. A board member seeing his or her position as an achievement will be less likely to receive criticism and new ideas in a healthy manner, may be less willing to listen to the advice of others, will be threatened rather than encouraged by new ideas, and will be more deeply offended by criticism. Directors concerned about their status may be prone to focus too much on preserving their reputation rather than focusing on the association’s welfare. A director has got to know his or her limitations. The best accept that they do not know everything; they rely upon managers, consultants, and committees. Such directors handle board disagreements much better by accepting the...

Avoiding Election Missteps: 8 Tips for a Winning Outcome

If practice makes perfect, association elections should be a breeze. However, overlooking even the smallest parts of the election can cause chaos. California Civil Code Sections 5100-5145 dictate the election process: when to use secret ballots; how to conduct elections; how to select inspectors; how to campaign; and how to conduct the ballot counting and understanding why the Civil Code requires these for fair elections, may help avoid some of those election day challenges. #1: Have election rules in place FIRST All associations are required by Civil Code 5105 to adopt election rules. Without election rules, the owners, inspectors of election and board are all at-risk of mistakes that may result in costly legal challenges. Older CC&Rs and bylaws probably do not even require secret ballots, so it is important that the rules describe how elections are conducted. Election rules must comply with both Civil Code and your governing documents and should contain: Nomination procedures, Director qualifications, Method of selecting independent third parties as inspectors of election, Rules for access to association mediaduring campaigns, Rules for access to common area meeting spaceduring campaigns, Secret ballot instructions and procedures. Once you have the basics outlined above, make sure that the board and your owners are comfortable with how it is presented. Some associations will add additional details about candidate statements or “meet the candidate” events. Work with your owners so that the rules represent your community’s preferences regarding elections. #2 Identify candidate and director qualifications in the candidate nomination forms Directors must meet the qualifications both at the time of nomination and during service on the board. Provide a clear list of qualifications...
Megan’s Law Disclosure

Megan’s Law Disclosure

Access To Information About Registered Sex Offenders Many states have passed so called “Megan’s Laws” which provided limited public access to Registered Sex Offender information. California’s law, Penal Code 290 et seq., was passed in 1996. Under that statute, citizens could visit a law enforcement office and find out limited information about Registered Sex Offenders living in a certain area. Under PC 290.4, a person could call the Department of Justice and ask if a specific name was included in the list of Registered Sex Offenders. Expansion Of Megan’s Law  In 2005, California lawmakers passed an expansion of the law regarding sex offender disclosure. The law expanded the information available regarding the most serious sex offenders, and also requires that the information be available to the public on a web site established by the state Department of Justice. The web site is now operational, and that web address is www.meganslaw.ca.gov. New Disclosures For the most serious sex offenders, a substantial amount of information must be disclosed on this web site and therefore available to the general public: If a Registered Sex Offender’s offense was: Kidnapping, rape, aggravated sexual assault of a child, sodomy, child molestation by force or duress, oral copulation by force or upon a child, continuous child abuse, penetration by force or upon child, or if the offender has been determined a “Sexually Violent Predator”, then the state web site must reveal the following information about that person: “names and known aliases, photograph, physical description, including gender and race, date of birth, criminal history, the address at which the person resides, and any other information that the...
Handling Solar Equipment Installations

Handling Solar Equipment Installations

  Given the increased interest in home solar power generation, community associations will need to be prepared to process solar equipment applications. There is a myth that boards are powerless to control the placement of solar equipment in community associations. In reality, although, the statutory intent behind solar power is to promote green energy in individual residences, associations have the ability to regulate certain installations for the protection of the community, and in certain cases to shift the burden of maintenance over to the homeowner seeking to install solar equipment. In general, California law provides that a homeowners’ association may impose reasonable restrictions with respect to solar equipment, consistent with Civil Code Sections 714 and 714.1. A reasonable restriction is a restriction that does not “significantly” increase the cost of the system or “significantly” decrease its efficiency of specified performance. Civil Code Section 714(d)(1) defines “significantly” as follows: (A) For solar domestic water heating systems, significantly means an amount exceeding 20 percent of the cost of the system or decreasing the efficiency of the solar energy system by an amount exceeding 20 percent, as originally specified and proposed. In other words, with regards to solar water heating systems, the association may not impose restrictions that will decrease efficiency or increase installation costs by more than 20%. But it may impose certain reasonable restrictions depending upon the proposed location of the application. And with respect to common area or exclusive common area applications the association may do the following: Restrict the installation of solar energy systems installed in common areas, as defined in Section 4095, to those systems approved by...
Restricted by the Amended Open Meeting Act? Learn to Delegate

Restricted by the Amended Open Meeting Act? Learn to Delegate

Civil Code Section 4900 et. seq. (a.k.a., the Open Meeting Act) leaves very little breathing room to handle an association’s business outside of a properly noticed board meeting. Therefore, in order to deal with these new legal requirements boards must find efficient ways to handle business in between meetings. One such tool is delegation. The Open Meeting Act allows boards to delegate duties to other persons, including the association’s managing agent, officers and committees of the board. As a result, tasks that require action in between board meetings can and should be delegated to officers, executive committees, or management depending on the task and authority required. The delegation should be made in a board meeting and reflected in the minutes (or preferably in a board resolution) that documents the purpose, scope and duration of the delegation. When delegating to an executive committee of the board, make sure the number of directors does not comprise quorum. Create a charter for the executive committee that identifies such items as the types of matters to be decided by the committee, the length of the committee’s duration (i.e., for a specific project or ongoing). Also, the tasks or decisions delegated to each committee are not already delegated to someone else by contract or the association’s governing documents (or are prohibited from being delegated by state statute). Many boards may now be inclined to delegate more tasks or projects to management. For example, it may be more efficient to set or increase spending authority for managers so that day-to-day maintenance decisions can be made in between board meetings. Both the board and management should...
Need To Appoint Replacement Members To The Hoa Board?

Need To Appoint Replacement Members To The Hoa Board?

It should come as no great surprise that when filling vacancies on the board created by resigning or disqualified directors, the role of filling those vacancies is left to the remaining board members. California Corporations Code Section 7224 provides: “(a) Unless otherwise provided in the articles or bylaws and except for a vacancy created by the removal of a director, vacancies on the board may be filled by approval of the board.” This means that a vacant director seat is filled by the appointment of a member who is approved by a majority of the Board. But imagine you are the only director left? What then? Fortunately, the Corporations Code provides a solution. Of course, one must always first look to the association bylaws to see if another method of filling vacancies is provided. But in the great majority of situations, your bylaws will be consistent with the Corporations Code, or Corporations Code Section 7224 will be your guide. Corporations Code 7224 (a) tells us that where the number of directors remaining in office is less than a quorum, the vacancies may be filled by: The unanimous written consent of the directors then in office; The affirmative vote of a majority of the directors then in office; or, A sole remaining director. Thus, if you are the last director standing, you are in luck. You have the right (if not the obligation) to fill the vacancies left by the resigned or disqualified directors. Indeed, it is wise to do so if you are the remaining director. Proceeding to conduct association business on your own may leave you vulnerable to...
A Widespread Drought: Legal and Other Challenges of the Association

A Widespread Drought: Legal and Other Challenges of the Association

Water conservation is not new to California communities. But the declared statewide drought emergency coupled with water conservation legislation aimed specifically at community associations leaves no doubt that water conservation will remain in our vocabulary. And while the emergency requires short term action to conserve water, it also provides a rare opportunity to make long term reductions in our communities’ water consumption, provided your community can negotiate through the challenges presented by its Governing Documents and human nature. Engage your residents Community-wide change requires owner buy-in. Look for ways to involve the owners in the process. For example, form a water conservation committee tasked with surveying the Association’s water use and identifying ways to reduce water consumption. If owners are part of the solution, you are more likely to build community-wide acceptance of water reduction measures. Guide the committee with a charter that identifies specific tasks such as: Identify areas suitable for drought tolerant plants. Locate areas for irrigation modification or reduction. Identify areas of poor drainage or excessive water run-off. Amend rules or adopt policies to reduce water use Associations subject to local water restrictions will have to conform to watering schedules and other limitations. Unregulated communities can be proactive by voluntarily adopting policies to reduce community-wide water use. Policies should limit watering to certain times of the day or certain days of the week. For sub-metered communities, boards can work with their local water utility to determine acceptable per owner water use standards and adopt policies to limit water use per owner. A fine schedule or surcharge would serve to motivate owners to monitor their own water...
Election Rules: Equal Access to Media and Common Area

Election Rules: Equal Access to Media and Common Area

As with many provisions of the Davis-Stirling Act, we look to judicial decisions interpreting the statutes for guidance in applying them in our own communities. With respect to community association voting and election laws, however, the Courts have steered clear of published decisions leaving us to rely upon our own interpretation or that of legal counsel, until now. In Wittenberg v. Beachwalk Homeowners Association the Court of Appeals gave us a welcome interpretation of two provisions of the elections law, albeit an interpretation that to many seems obvious. The Wittenberg v. Beachwalk Homeowners Association opinion leaves no doubt that Civil Code Section 5105 requires equal access to association media and common area. But the opinion provides an important message to association boards in community association election matters: when the board advocates for or against a particular election position, it is treated no differently than any individual member. Equal access is required. Despite the best intentions, boards sometimes overstep their authority when purporting to act in the best interest of the community. This is particularly the case when an association incurs significant expense to amend its governing documents. The board will be compelled to advocate in favor of passing the amendment through town halls, campaigning and letter writing urging support for the proposed amendment. But under the Beachwalk opinion, such action will trigger the obligation to allow a member with an opposing view the right to hold his or her own town hall or use of the association media to advocate their views. In Beachwalk, the board conducted three election campaigns over a period of time to amend the association’s...
Court Provides Guidance on Who Can Attend Board Meetings SB Liberty v. Isla Verde Association Inc.

Court Provides Guidance on Who Can Attend Board Meetings SB Liberty v. Isla Verde Association Inc.

A longstanding issue of ambiguity and occasional dispute arises when a member tries to designate someone to attend a board meeting for them. Civil Code § 4925 (“Open Meeting Act”) states that “any member of the association may attend meetings of the board of directors of the association.” A dispute often arises when a homeowner wants to bring an attorney to a board meeting, or have their attorney attend a board meeting in their place. The Court of Appeals took a big step toward resolving such disputes when it issued its opinion in SB Liberty LLC v. Isla Verde Association. The SB Liberty Court was concerned with whether an attorney was the proper representative of an LLC in order to attend a board meeting. But the opinion has broader impact in other areas of community association governance including whether that LLC member can serve on the Board and the authority of the board to determine how to conduct its own meetings. What is clear from the opinion is that a member cannot send a “representative of its own choosing” to a board or members meeting and that the board has the authority to exclude nonmembers from its meetings. Isla Verde is an association of 87 homes in Solana Beach, into which Gregg and Janet Short bought a residence in 2006. They put ownership of the property first in a family trust, and later in an LLC called “SB Liberty LLC.” For reasons unexplained in the appellate decision, the Shorts sought to have their attorney attend a board meeting on their behalf. The Shorts executed a “Specific Power of Attorney”...