There is no substitute for expertise. HOA law is what we do.

Turtle-Rock-Ridge-300x169It’s our privilege to welcome Turtle Rock Ridge Association to Tinnelly Law Group’s growing family of HOA clients.

Turtle Rock Ridge is a condominium community in Irvine with views of Shady Canyon and the Strawberry Farms golf course.  Residents enjoy two community pools, spa, walking trails, parks, and tennis courts.

hoa law firm Our HOA lawyers and staff look forward to working with Turtle Rock Ridge’s Board and management.

debt-collection-scams*Asked and Answered

AskedWe have several members in our community that are failing to pay their monthly HOA dues and have run through several debt collection firms in an attempt to collect on these accounts. The firms we have used continuously promised us to collect the delinquency and that “the fees will be paid by the delinquent homeowner.” Well, in most of our cases, we ended up paying triple or quintuple the delinquent amount in legal fees and collection costs all to end up with nothing or a small portion of it. We have come to the point where we don’t see that “light at the end of the tunnel” and would like to know what really is the most efficient and effective way to collect delinquent assessments.

Answered – It is not uncommon to come across HOA boards that have a sour taste in their mouth left by their prior debt collection firm. This is mostly caused by firms that (1) guarantee and promise results (specifically, promises that they will get the job done and all costs will be reimbursed by the homeowner-debtor); (2) drive up their legal fees and costs; and (3) end up not being able to collect or recoup the delinquency from the debtor. This leaves the HOA to not only write off the bad debt, but to also incur costs that are exponentially higher than the original debt.

There are two (2) primary methods in which HOAs are able to collect on delinquent assessments: (a) judicially and (b) non-judicially. The former requires the involvement of the court system, consisting of a lawsuit that prays for a money judgment and/or judicial foreclosure (court ordered sale of the home). The latter is through non-judicial foreclosure (“NJF”) that does not require the court’s involvement.

Judicial Enforcement

Generally, getting the court involved increases the amount of time and money that an HOA must expend due to the added court fees, court procedures, attorney appearances, and so on and so forth. This is especially true if the homeowner decides to contest the lawsuit and file an answer, further dragging out the time and cost for resolution. Barring homeowner contest, judicial enforcement can be effective and beneficial in two (2) situations: (a) when the home is underwater (i.e., no equity), or (b) when there is senior foreclosure activity.

When the home is underwater, an HOA should not seek foreclosure because the chances of a buyer purchasing the property is slim to none, leaving the HOA to take title to the property. In this situation, a lawsuit is beneficial in that the HOA has the option to proceed with collecting on the money judgment through a variety of collection methods (e.g., bank levy, wage garnishment). This same benefit applies to the second scenario wherein the senior lender is in the process of conducting its own foreclosure sale. This is because if there is senior foreclosure activity and the HOA attempts to conduct its own sale prior to the senior’s, it is unlikely that anyone would be willing to buy the home subject to the mortgage, or even worse, to be foreclosed on by the senior.

The ability to opt to pursue a money judgment is indeed beneficial. However, boards must keep in mind that the added benefit does not come without its flaws:

  • Increased legal expenses, costs and time;
  • Subject to same NJF risks:
    1. Lack of equity;
    2. Senior foreclosure.
  • Uncollectable money judgments

Above all, should judicial enforcement fail, the HOA will not only have to write off the debt and absorb the legal fees and collection costs, but will have to do it all over again should the homeowner-debtor continue to reside at the property and fail to pay assessments. This is something that HOAs do not have to worry about when proceeding with NJF.

Non-Judicial Enforcement (i.e., NJF)

NJF is similar to judicial enforcement with the exception of two (2) crucial differences:

  • As to both judicial foreclosure and money judgment: It does not require court involvement and attorney appearances, saving the HOA a substantial amount of money and time; and
  • As to money judgment: It secures not only the delinquent amount accrued up to the date of lien recordation, but all future delinquent assessments, costs, late fees and interests accrued thereafter.

In addition to the NJF advantages listed above, NJF generally resolves the delinquent matter before it ever reaches the foreclosure sale. This is because the homeowner realizes what is at stake: his/her home and increasing collection costs, fees and interest. The California Civil Code requires HOAs to perform the following steps, among other things, prior to the foreclosure sale:

  • Pre-lien Letter: This informs the homeowner of the delinquency and risk of losing his/her home;
  • Recordation of Delinquent Assessment Lien (“Lien”);
  • Recordation & Service of Notice of Default (“NOD”); and
  • Recordation & Service of Notice of Trustee’s Sale (“NOS”).

Nine out of ten times, the delinquent homeowner will reach out and pay off the delinquency before it reaches the NOD stage, providing a resolution timetable of approximately 60 – 75 days. This is because the Lien puts a “cloud” on title of the home, preventing the homeowner from obtaining loans, refinancing his/her mortgage, and/or transferring title to the home. In the rare instances that this does not occur, the HOA can simply proceed with the sale. With a shorter turnaround time and lower legal fees and costs, NJF can be advantageous for most HOAs to utilize for assessment collection.

California HOA lawyers In most delinquent assessment matters, it is unlikely that the subject home will lack sufficient equity to recoup the HOA assessment debt, which makes NJF that much more appealing. However, as discussed, there are instances where NJF may not be a viable option. This is why it is of utmost importance that the HOA’s collection agent does its due diligence in thoroughly evaluating each account before providing a recommendation as to proceeding with judicial or non-judicial enforcement.

-Blog post authored by TLG Attorney, Andrew M. Jun, Esq.

Pacific-Landing-300x169It’s our privilege to welcome Pacific Landing Community Association to Tinnelly Law Group’s growing family of HOA clients.

An exceptionally rare new home opportunity in El Segundo, Pacific Landing presents an intimate collection of luxury homes designed with sophistication in mind. Ideally located on the Westside of Los Angeles, Pacific Landing is close to shopping, dining, recreation and entertainment in charming downtown El Segundo, Silicon Beach employers, first-class schools and so much more.

hoa law firm Our HOA lawyers and staff look forward to working with Pacific Landing’s Board and management.

Del-Sur-300x169It’s our privilege to welcome Del Sur Community Association to Tinnelly Law Group’s growing family of HOA clients.

Tucked between Rancho Santa Fe and Black Mountain Open Space Park, Del Sur offers distinctive neighborhoods nestled among 1,000 pristine acres. Del Sur is a vibrant San Diego master-planned community with distinctive architecture, award-winning schools and unmatched community spirit. Homes and parks are inspired by historic neighborhoods that have charmed generations of San Diegans – neighborhoods like Mission Hills, Kensington, La Jolla and Coronado.

hoa law firm Our HOA lawyers and staff look forward to working with Del Sur’s Board and management.

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Serial dog poop litterers, unauthorized parking of vehicles, architectural violations, smoking nuisance—the list goes on and on when it comes to common “repeat violations” that a homeowners association (“HOA”) encounters on a day-to-day basis. With the increasing number of repeat violations and limited number of HOA board members and property managers, questions have surfaced whether or not HOA’s may, or should, utilize drones to enforce violations. Specifically, HOA boards are concerned with the legal implications that such utilization may impose because, well, why wouldn’t an HOA board want to send out a drone to inspect an architectural violation or monitor a smoking nuisance in lieu of physically walking to the property to do the same? In addition to the convenience factor that drones provide, it gives HOAs the added benefit of having concrete, recorded evidence should the violation escalate to the level of arbitration or judicial enforcement.

From a legal standpoint, the two primary areas of law that factor into HOA drone usage are (1) privacy law and (2) property law.

Privacy

While there are numerous privacy laws and regulations, for HOA purposes, California Civil Code §§ 1708.8 (a) and (b) (collectively, the “Provision”) are the most applicable in regard to drone surveillance and enforcement. The Provision prohibits both “physical” and “constructive” invasion of privacy. Physical invasion of privacy requires the element of intentional trespass onto the land or airspace of the home (discussed further below) while constructive invasion of privacy does not require the element of physical trespass onto land or airspace.

In any event, both Provisions hold one liable for invasion of privacy when same utilizes a drone to “capture any type of visual image, sound recording, or other physical impression of the plaintiff [e.g., homeowner] engaging in a private, personal, or familial activity and the invasion occurs in a manner that is offensive to a reasonable person.” (Emphasis added.)  Ah yes, the “reasonable person” standard comes into play here as it does in almost 99.99% of standards used to dictate liability. Interpret it exactly how it sounds. If an HOA is utilizing the drone to capture a serial dog poop litterer in the community park, it certainly would not offend a reasonable person walking their dog in the park, nor would the violating individual have a “reasonable expectation of privacy” (a standard also used to adjudicate privacy suits) on common area owned by the HOA.

On the other hand, if an HOA is investigating a nuisance matter of excessive cigarette and/or marijuana smoke, can the HOA operate a drone from the common area zooming into the living room? Probably not. While one may make the argument that if the smoking activity was viewable in plain sight from common area streets (e.g., curtains wide open) that the individual has no reasonable expectation of privacy, it is likely to fail because the principle of an individual’s right and expectation of privacy within his/her home is held to an extremely high standard. Furthermore, it is best practice for HOA’s to err on the safe side of caution and avoid potential exposure to liability.

Property

In addition to looming privacy concerns, HOAs need to be aware of property laws that protect homeowners from drone usage; in particular, communities that consist of single family homes wherein the homeowner owns the airspace above the land. In the early stages of property law (also known as “common law”), the principle that controlled for centuries was “[w]hoever’s is the soil, it is theirs all the way to Heaven and all the way to hell.” Of course, this has changed over the years with the evolution of mankind and (flight) technology starting with the groundbreaking U.S. Supreme Court case United States v. Causby, wherein the Court held that homeowners owned the airspace above ground level up to 365 feet (anything above that was public domain).

Today, homeowners own the airspace 500 feet above ground level in “uncongested areas.” (14 CFR § 91.119(c).)  This is the standard generally applied to airspace demarcation in residential communities (i.e., HOA’s).  See Lacey v. United States, 595 F.2d 614 (1979); see also Aaron v. United States, 311 F.2d 790, 801 (1963).   The idea behind this is to give homeowners property rights to their parcel of land as high above it as “normal use of the land” requires. As such, unless the drone is capable of operating in excess of 500 feet above ground level (at which point no practical HOA purpose will likely be served), under very limited circumstances should a drone ever be hovering above a homeowner’s physical land or airspace.

California HOA lawyers HOAs should utilize drones to enforce violations of their governing documents where appropriate—this should be considered on a case-by-case basis. Whether it is a serial dog poop litterer or smoking nuisance matter, it is advised that HOAs that are intending on utilizing drones use sound judgment, and more so, consult with their general counsel. Keep in mind that in order to operate a drone for HOA-related purposes, the HOA will have to apply for an exemption from registering the drone with the Federal Aviation Administration (“FAA”).

From our experience, with any recording devices implemented by HOAs, it is best practice and strongly recommended for HOAs to adopt a “Surveillance Camera Policy” or “Drone Policy,” wherein rules are implemented to regulate such devices and afford protection to the HOA.

-Blog post authored by TLG Attorney, Andrew M. Jun, Esq.

Entrada-300x169It’s our privilege to welcome Entrada Owners’ Association to Tinnelly Law Group’s growing family of HOA clients.

Entrada is a new collection of courtyard-style single family homes by Signature Homes. Entrada is conveniently located in the Natomas area of Sacramento for easy commuting — close to schools, shopping, parks and biking trails.

hoa law firm Our HOA lawyers and staff look forward to working with Entrada’s Board and management.

In case you missed it, Issue # 41 of our ‘Community Association Update’ newsletter is available now!New-Newsletter-Tempalte-300x167

Topics covered in this issue include:

  • SB 323 Signed! The New State of HOA Election Laws
  • Navigating the Hidden Risks of Homeowner Security Devices
  • THOU SHALT NOT REMOVE THE MEZUZAH:  California Legislature enacts SB 652 to Protect Displays of Religious Items on Doors and Doorframes
  • Vendor Relationships – Navigating Resident Interactions
  • The What and Why of Lender Rights, and How to Deal with Same

A link to the newsletter is here.

Need to be added to our mailing list? Click here to sign up. Links to previous editions of our newsletter can be found here.

New-Client-Photo-Template-0219-300x169It’s our privilege to welcome Gala Community Association to Tinnelly Law Group’s growing family of HOA clients.

Gala is a new collection of single-story, elevator-served flats at The Cannery in Davis. As the final neighborhood to be built within California’s first farm-to-table new home community, residents will enjoy all the community lifestyle and educational amenities that both Davis and The Cannery have to offer. Forty-eight of the flats are located within the southwestern part of the community along The Cannery Loop Trail. The remaining flats are found in the southern part of The Cannery, near The Amphitheatre and Market Park.

hoa law firm Our HOA lawyers and staff look forward to working with Gala’s Board and management.

Timeline-cover-image-1Election-Laws-Cover-Image

*New Legislation

Governor Newsom recently signed into law Senate Bill 323 (“SB 323“). SB 323 makes substantive modifications to the Civil Code’s provisions governing HOA elections, effective January 1, 2020. Some of the more significant modifications require associations to amend their election rules to conform to new statutory requirements, limit the types of candidate qualifications an association may adopt, address the only circumstance for elections by acclamation, place limitations on who may serve as an inspector of elections, and bolster the ability of members to overturn an election that is not conducted in accordance with proper procedures.

*We have published a detailed article on SB 323, entitled “The New State of HOA Election Laws.”  The article is available for download, here.

*Also included with the article is a “Director Election Timeline” that illustrates the new pre-election notice requirements imposed by SB 323.  The timeline is also available for download, here.

California HOA lawyers SB 323 requires HOAs to make immediate changes to their election rules, especially those HOAs that have their annual meeting set to take place in the first quarter of 2020. Time is of the essence. Our team of HOA lawyers is ready to assist our clients with the steps needed to conform to the changes imposed by SB 323. 

 

Chained-Social-Media-Facebook-Twitter-YouTube-Regulations-Internet-900Like it or not, we live in the age of social media. It is undeniable and has dramatically transformed the way we communicate in every arena, including homeowners associations (“HOA”).  Information, opinions and images are broadcast and circulated at a rapid pace with little or no oversight involved.  These unfiltered transmissions over social media airwaves can have profound impacts on homeowners associations’ governance (board of directors), as well as its membership (homeowners).  Understanding the legal implications of social media use in the context of managed communities is critical to avoid conflicts, unexpected costs and legal battles.

In recent years, we have seen a myriad of lawsuits stemming from social media abuse:  In Tennessee, a homeowner faced legal action from her HOA for using the name of her subdivision on her personal Facebook neighborhood page.  In New York City, co-op residents aired their dirty laundry online, resulting in multiple lawsuits.  Elsewhere, a vacation-condominium owner sued a guest for $15,000 over negative social media comments.

It is not uncommon to find defamatory language being hurled at board members or management by disgruntled homeowners on online community forums, board members purporting to speak on behalf of the association on their personal Facebook pages, and association social media channels turning into de facto board meetings in violation of state law and governing document protocols.

These problems arise largely due to an inherent discord between the nature of social media and how community associations operate.  Association managed communities are highly regulated and restricted – indeed, their chief governing instrument is titled Covenants, Conditions and Restrictions (“CC&Rs”). To the contrary, social media regulation is grossly inadequate.  Simply put, people are free to share their thoughts and opinions without real consequences, which often leads to capricious communications.  However, people cannot do this in community associations. For instance, homeowners cannot blurt out opinions in board meetings – in fact, homeowners are often not even allowed to speak, unless given permission.

Unfortunately, the legal landscape has been quite slow to catch up with the problems associated with unbridled communication.  There are few, if any, state laws to govern the use of social media in the realm of corporate governance.  Moreover, developers who write the CC&Rs are focusing on issues like special assessments and architectural approval, not whether board treasurer Bob has the right to post his opinions on the clubhouse renovation on Twitter.

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