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92803020-debt-collector-red-text-round-stamp-with-zig-zag-border-and-vintage-texture-It is no secret that homeowners’ associations (“HOA”) are run and managed through the funds of monthly HOA assessments (“Fees”), and more often than not, HOA’s hire and retain debt collection firms to collect on past due Fees from delinquent members of the community. Sometimes, this leads HOA’s to lose large amounts of money in collection costs and write-offs (of “bad debt”) due to homeowner challenges under the Federal Debt Collection Practices Act (“FDCPA” or “Act”). The FDCPA provides protection to consumers (e.g., homeowners) from abusive debt collection practices by placing a myriad of procedures and limitations of which all debt collection firms must abide by, unless said firm solely recoups debt via non-judicial foreclosure, in which case the firm will only be subject to FDCPA § 1692f(6), discussed in detail further below. This was the U.S. Supreme Court’s holding in Dennis Obduskey v. McCarthy & Holthus LLP, No. 17-CV-1307, 2019 WL 1264579 (March 20, 2019).

In Obduskey, the homeowner defaulted on his mortgage payment, causing the lender to retain McCarthy & Holthus LLP (“Firm”)—a debt collection firm that solely recoups debt via non-judicial foreclosure—to foreclose on the home. The homeowner, Dennis Obduskey, brought an action against the Firm to challenge the foreclosure on the basis of alleged violations under the Act, among other things; in particular, Section 1692g(b). In short, Section 1692g(b) mandates a debt collector to cease all collection efforts and verify the debt it is attempting to collect if a debtor challenges/disputes the debt.

The Court, in agreement with the lower courts, ruled in favor of the Firm and dismissed the case against same on the basis that the Act (i.e., § 1692g(b)) did not apply to the Firm as it was not a “debt collector” under the Act’s primary definition (un-emphasized portion):

The term “debt collector” means any person who uses any instrumentality of interstate commerce or the mails in any business the principal purpose of which is the collection of any debts, or who regularly collects or attempts to collect, directly or indirectly, debts owed or due or asserted to be owed or due another…For the purpose of section 1692f(6) of this title, such term [“debt collector”] also includes any person who uses any instrumentality of interstate commerce or the mails in any business the principal purpose of which is the enforcement of security interests.

(FDCPA § 1692a(6).) (Emphasis added.)  The Court found that Section 1692f(6) of the Act was the only section applicable to the Firm as it fell under the “limited purpose definition” of “debt collector” (“LPD”)—section emphasized above—as its sole method of recouping debt was by enforcing security interests held in personal/real property through non-judicial means (e.g., non-judicial foreclosure), exempting the Firm from the rest of the Act.

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

Located in Chula Vista, against the breathtaking natural setting of San Miguel Mountain, Vista Del Cielo is a stunning enclave that combines an outstanding location with beautiful residences designed for your modern life.

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

Charter-Point-300x169It’s our privilege to welcome Charter Point Community Association, Inc. to Tinnelly Law Group’s growing family of HOA clients.

Charter Point is a collection of single family homes in the Cowan Heights area of North Tustin.  Residents enjoy large lots; close proximity to hiking, biking, and horse trails; and scenic views of the city lights, hills, and mountains surrounding Orange County.

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

34897866_1544762584740987_rBoth Commercial and Residential Condominium CC&Rs frequently contain insurance language requiring the Association to obtain hazard (fire) insurance and prohibiting Owners from obtaining such coverage.  Condominium Owners on the other hand are limited to obtaining liability insurance.  Similar language was found in the CC&Rs of the condominium association in Western Heritage Insurance Company v. Frances Todd, Inc. No. A152428 (Cal. Ct. App. Mar. 4, 2019).  The insurance language for The East Shore Commercial Condominiums located in Berkeley, California included the following:

Article 13.1 requires the Association to “obtain and maintain a master or blanket policy of all risk property insurance coverage for all Improvements within the Project, insuring against loss or damage by fire or other casualty. … The policy shall name as insured the Association, the Owners and all Mortgagees of record, as their respective interests may appear.” Article 13.3 provides in part, “Any insurance maintained by the Association shall contain [a] ‘waiver of subrogation’ as to the Association, its officers, Owners and the occupants of the Units and Mortgagees. …” Article 13.4 prohibits an individual owner from obtaining fire insurance while allowing an owner to obtain individual liability insurance. Article 3.1 requires that all “occupants and tenants” comply with the CC&Rs.

This language requires the Association’s hazard insurance policy to “name as insured the Association, the Owners and all Mortgagees”, thereby, protecting not only the Association, but also all Owners and Mortgagees as insureds.  Although tenants are not included as an “insured” by these CC&Rs, “occupants” are protected by these CC&Rs from subrogation.


Defendant, Frances Todd, Inc. was a furniture manufacturer; and a tenant leasing a condominium unit in a commercial condominium complex.   The Defendant (tenant) was negligent in causing the fire which destroyed the unit and surrounding units.  Western Heritage Insurance sued the tenant for indemnity to recover all amounts it paid the Association on the Association’s fire damage claim on a theory of the tenant’s underlying negligence.   The court looked at both the CC&Rs and the lease between the Owner and tenant and concluded the Association’s fire insurance policy also benefited the tenant:

The CC&R’s, applicable to both the Owner and defendants (tenants) as occupants, required the Association to obtain a policy of fire insurance and to name the Owner as an insured on that policy, and precluded any party other than the Association from maintaining fire insurance on the premises. The fire insurance purchased by the Association was intended to be the only fire policy on the property and was for the benefit of the property’s lessees absent language to the contrary in the lease.

The court also noted that:

“In California, courts have held a lessee is not responsible for negligently caused fire damages where the lessor and lessee intended the lessor’s fire policy to be for their mutual benefit.”

Even though the CC&Rs did not specifically state that tenants were to be named as insureds, the Court reasoned that such a conclusion was implied based upon its review of the CC&Rs and the lease between the Owner and the tenant.  The court also noted that the Owner pays for insurance through his or her dues and the tenant contributes to those dues by his/her rent and there is no requirement that a specific amount of dues or rent be allocated for the fire insurance policy.  Therefore, the tenant like an Owner was a beneficiary under the Association’s insurance policy and could not be sued for negligently causing the fire by the Association’s insurance.

Hazard (Fire) Insurance Policies are “no fault” Policies.  They cover Hazards (fires) whether or not they are caused by the Insured’s own negligence.

The fact that the furniture manufacturer tenant was negligent was not an issue in this case.  The only issue was whether they were a beneficiary under the Association’s insurance policy. The court noted that if negligent fires were not covered by fire insurance policies, then insurance companies would be incentivized to litigate the insured’s possible negligence in all fires; and litigation would be never ending:

A fire insurance policy which does not cover fires caused or contributed to by the insured would be an oddity indeed.  Otherwise, few insured fire claims would be paid without controversy and most would require litigation. For that reason we do not deem that a policy ‘for the benefit’ of a lessee excludes coverage for fires caused by his negligence.

How does this case affect the Association’s right to recover Common Area Damages from Owners under Civil Code §6858(b)?

Civil Code §6858 (b) allows the Association to recover damages to Common Areas:

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, 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.

California HOA lawyers In cases of fires covered by an Association’s hazard insurance policy the Association is responsible to pay the deductible required under the policy.  This case does not affect the Association’s right under Civil Code §6858(b) to sue the tenant or the Owner for that matter for the amounts (including the deductible) not covered by the fire insurance policy. 

-Blog post authored by TLG Attorney, Bruce R. Kermott, Esq.

Legacy-at-Bryant-Ranch-300x169It’s our privilege to welcome Legacy at Bryant Ranch Association to Tinnelly Law Group’s growing family of HOA clients.

Legacy is a gated community of single family homes located in the city of Yorba Linda.  Residents enjoy mountain-top views and close proximity to parks and walking trails.

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

Stone-Harbor-300x169It’s our privilege to welcome Stone Harbor – Bridgeport Homeowners Association to Tinnelly Law Group’s growing family of HOA clients.

Stone Harbor – Bridgeport is a community of custom single family homes located in the city of Riverside.  Residents enjoy large lots in a beautiful park-like setting.

hoa law firm Our HOA lawyers and staff look forward to working with Stone Harbor – Bridgeport’s Board and management.

new-hoa-newsletter-39-300x167In case you missed it, Issue # 39 of our ‘Community Association Update’ newsletter is available now!

Topics covered in this issue include:

  • Workplace harassment in a HOA environment
  • Voter apathy is not a required showing in a petition to reduce CC&R amendment approval requirements
  • Architectural variances binding on future owners
  • Courts will defer to good faith decisions of HOA Boards
  • Recent ruling limits anti-SLAPP protection for HOA Board actions

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.

Neighbor-Disputes-8-Smart-Tips-to-Legally-Deal-with-Nuisance-Caused-by-Nasty-Neighbors*Unpublished Opinion

The Court of Appeals recently rendered an unpublished opinion in  Harbour Island Condominium Owners Association, Inc. v. Alexander (2019), which provides some clarity regarding a tenant’s right to attend board meetings and the ban on noxious activities within the community.

The Harbour Island Condominium Owners Association (“HOA”) sought a restraining order (known as a preliminary injunction) against two tenants and their landlord to abate the tenants’ noxious behavior.  The HOA relied on the provision in the CC&R’s, which stated that residents cannot disturb the neighborhood or occupants of a neighboring property or create a nuisance.

Neighboring residents made several complaints to the HOA about the tenants’ excessive and purposeful noise: the tenants consistently stomped on their floors and slammed their doors.  In addition to the noise complaints, tenants permitted their dog to urinate in the Common Area, despite the posted “No Dogs” signs.  Lastly, the tenants engaged in aggressive behavior against the Board of Directors in an apparent attempt to intimidate Board Members.  For example, the tenants secretly photographed a Board Member at the pool on different occasions.

The trial court granted the preliminary injunction, ordering the tenants and their landlord to install throw rugs throughout the unit and a sound-muffling device on the doors; to cease photographing Board Members; and to prevent their dog from urinating on the Common Area.  The trial court ruled in favor of the HOA because the tenants’ noxious behavior unfairly oppressed the rest of the community, while the ordered corrective measures were minimally oppressive to the tenants.

The Court of Appeals upheld the trial court’s decision.  Despite the fact that the HOA’s nuisance provision did not mention dogs, the Court broadly interpreted the existing provision to encompass the exclusion of dogs from the Common Area for health and safety reasons.

Furthermore, the Court held that the nuisance provision bans acoustic nuisances that interfere with a neighbor’s right to quiet enjoyment.  In this case, the nuisance claims were supported by credible witness testimony that the tenants’ noise was excessive.

Lastly, the Court of Appeals disagreed with the tenants that their due process rights had been violated since the tenants were not permitted to challenge the violation notices at hearings.  The Court held that only Owners with vested property rights are Members of the HOA.  As such, only Members may participate in HOA meetings.

California HOA lawyers The Harbour Island case highlights the broad reach of nuisance provisions in CC&Rs and serves as a reminder that Owners, not tenants, have the right to attend and participate in HOA meetings. 

-Blog post authored by TLG Attorney, Sarah A. Kyriakedes, Esq.

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

Brisbane is a condominium community located in the city of Oceanside.  Residents enjoy a pool, spa, tot lot, and dog park.

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

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

Lexington is a community of new single family homes in Escondido by KB Homes.  These spacious 10,000 square-foot+ homesites are surrounded by rolling hills and offer easy access to nearby parks and recreation.

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