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Civil-LitigationSince COVID-19, followers of the real estate market may have noticed that the housing market is currently booming.  There are not as many sellers as there are buyers, so the competition to obtain a buyer’s dream home is through the roof.  Many of these potential buyers are looking to buy their next home within a community association (“HOA”).  The competition to buy homes creates an increase in the number of questions from real estate agents and mortgage/escrow companies that are directed toward the association and its agents regarding any litigation involving the association.  What should the Board and manager be aware of?  What should they do in certain situations?

The HOA has no legal obligation to make disclosure to buyers of properties within the HOA or other third parties.  These third parties may be real estate agents, loan processors, escrow companies, or anyone else looking for information regarding the HOA and is not an HOA member.

Even though the HOA has no legal obligation to make disclosures, its management company and even its Board will be asked numerous times by third parties to provide further information regarding any pre-litigation matter or lawsuit the HOA is engaged in. Some typical questions are:

      • Can the HOA or management provide a copy of the complaint?
      • Can the HOA provide certain certifications or expert documentation?
      • How much money is the HOA and/or management being sued for?
      • Would the anticipated or known damages and legal expenses be expected to exceed some percentage of the HOA’s reserve fund?
      • Can the HOA’s attorney provide an opinion that any award granted in the lawsuit will be covered under the HOA’s master insurance policy?
      • When will the matter be resolved and will it be resolved in the HOA’s favor?

Sometimes, these third parties will require that the answer to the above questions come from the HOA’s legal counsel. In any case, neither the HOA’s Board, nor its managing agent, or any of its agents (including legal counsel) should answer any of the above questions.  If legal counsel is handling the matter, they should prepare a disclosure letter that the HOA may use to present to any third parties requesting further information.  In addition to not answering any of the questions above, the disclosure letter should also not contain any predictions or conclusions.  The more vague the better, as the disclosure letter is meant to be an official tool to block further communication from third parties.  If applicable, the disclosure letter will provide the appropriate contact information if the HOA’s insurance carrier picked up the case and assigned insurance defense counsel and an adjuster. If the HOA and its managing agent need help navigating this scenario, they should direct all questions to its legal counsel.

If a homeowner wants more information regarding any pre-litigation or lawsuit in order to refinance their home, and the pre-litigation or lawsuit is not resolved, no material or information should be disclosed beyond the fact that things are in progress.  The general disclosure letter may be provided to the homeowner.  The HOA is not obligated to assist homeowners in refinancing and should not if the information being requested is privileged (confidential).

Any questionnaire sent to the HOA or its managing agent should be forwarded to legal counsel for analyzation.  The questionnaire should not be filled out and returned without legal counsel’s input as any disclosures might create unwanted liabilities for the HOA.

California HOA lawyers While evading questions from homeowners and third parties might seem frustrating, such action is a necessity.  Pre-litigation and the proceedings of a lawsuit do not guarantee any outcome.  The HOA and its managing agent should know that homeowners and third parties will be very aggressive in trying to obtain further information.  However, the best course of action would usually be to: (1) direct the matter to the HOA’s legal counsel; (2) provide the disclosure letter; and (3) indicate, in some fashion, that there is no further information at this time as the matter is ongoing or in the process of being resolved (descriptions will vary depending on each scenario).

-Blog post authored by TLG Attorney, Vivian X. Tran, Esq.

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

Canyon Crest Estates is a condominium community located in Corona Del Mar. Residents enjoy a community pool, spa and tennis courts.

hoa law firm Our HOA lawyers and staff look forward to working with Canyon Crest Estates’ Board and management.

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

Waverly Terrace is a condominium community located in the Silver Lake area of Los Angeles. Residents enjoy a community pool, sauna, and fitness center.

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

pexels-photo-2179205There will come a time when a homeowner violates an association’s governing documents (i.e., CC&Rs, Rules & Regulations, Architectural Guidelines…etc).  If there is a possibility those violations will be litigated, the association must have a proper trail of evidence to bolster their claims.

Q:  What are some types of violations that would need evidence?

A:  Unapproved architectural improvements (i.e., walls, patio covers), failing to maintain property exterior in planned developments (i.e., shutters, paint, landscaping), inappropriate parking…etc.

Q:  What should the association or its community manager do when there is this type of violation?

A:  For these violations, the association’s community manager should clearly document in their written records: what the violation was, which governing documents provision was violated, who committed the violation, if known (e.g., an owner, guest, tenant), when the violation occurred (i.e., date and time), where the violation occurred, and anything else that might be relevant.  Additionally, a photo of the violation should be taken on the date it occurred and reoccurred.

Q:  How should the photo be taken?

A:  The photo should be taken directly in front of the violation.  There should be plenty of natural light to clearly see what type of violation it is.  Flash should be utilized if it improves the picture quality.  The photo should not be taken from within a vehicle because there will be light and color distortion; furthermore, the violation photo should not include portions of the vehicle.  If there is a parking violation that occurs in the evening, any photos submitted by the association patrol vendor should be taken from the outside of a vehicle.

It is important that the photo be taken with a high-definition camera, if possible, so as to not be grainy or blurry.  There should be no objects distracting from the violation (e.g., people, pets, vehicles).

Q:  Why so particular about the violation photo and written evidence?

A:  If the matter goes to litigation, the association will need to prove that a homeowner has committed the violation(s) alleged by the association.  A judge will want to see actual physical photo evidence and clear documentation of the homeowner’s violation history.  Without proper evidence, the association might have a hard time winning its case.  If there is a clear violation history and evidence, the judge will be able to order the homeowner to correct the violations.

Even if the matter does not go to litigation, a proper trail of evidence will assist the association’s general counsel in dealing with the matter.

California HOA lawyers The association should request that management take a photo of every violation if they wish to properly retain evidence and enforce their governing documents.  Without a photo, no matter how big or small the violation, the homeowner can always argue that the association was mistaken, and the violation never occurred.  It would be a case of “he said, she said” argument that would go nowhere—it would definitely not hold up in court.

-Blog post authored by TLG Attorney, Vivian X. Tran, Esq.

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

Pelican Ridge is located in the Pelican Hill Communities in Newport Coast. Residents enjoy spectacular views of Newport Beach, the Newport Coastline, Catalina Island, City Night Lights, the Pacific Ocean and beautiful sunsets.

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

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

Links Pointe homes are located in the coastal community of Laguna Niguel. Residents enjoy lush green views of the greenbelt, shimmering creek and beach trail.

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

funeral-etiquette-1000x500-getty-1200x675-1When a delinquent homeowner dies, there is a strict one-year statute of limitations to sue them or to continue a lawsuit against their estate. (Cal. Code Civ. Proc. § 366.2). This is true even if the statute of limitations would have been longer had the person survived. This harsh rule applies even if you did not know that the person died so Boards and management should take notice if a homeowner does not respond to communications or suddenly falls in arrears and then investigate further by contacting family members or emergency contacts during circumstances of non-responsiveness and/or extended non-payment.

The second important rule when a debtor dies is that when a probate estate has opened, any creditor has only four months from the date the executor or administrator is appointed to file a claim in probate. (Cal. Code Civ. Proc. § 377.40; Prob. Code §§ 9100 et seq.). Sometimes the decedent has no family or heirs or the heirs fail to open a probate. In this case, the HOA may reach out to the public administrator in the county where the real property is located to request that they open a probate. If this is not done, then it is incumbent on the HOA to open the probate as a creditor to ensure that the above-referenced statute of limitations does not run. (See Prob. Code §§800; 48).

Since a dead person cannot be sued, the HOA must sue the estate of the decedent. If a lawsuit was filed while the homeowner was alive, but they are now deceased, a motion should be timely filed to substitute the deceased person with their estate. (Cal Code Civ. Proc. § 377.31). Counsel should be mindful that the motion must be filed within three (3) months of the rejection of the HOA’s creditor’s claim, which is deemed rejected if not responded to within thirty (30) days of submission. (Prob. Code §§ 9256, 9352, 9353, 9371). It is important to note that once the creditor’s claim is filed, the one-year time bar pursuant to Code of Civil Procedure §366.2 is tolled. Nevertheless, the creditor’s claim must be filed within one year of the decedent’s death or the claim is barred entirely.

Thankfully, the above harsh requirements do not apply when the debt is one that can be secured via a lien on real property that may be foreclosed, such as with assessment liens. This is because such debt attaches to the property and not to the deceased person.

California HOA lawyers The death of a delinquent homeowner can pose complex and time-sensitive challenges. This is why HOA’s should promptly contact their counsel or collections professional for assistance in the event of a delinquent homeowner’s death.

-Blog post authored by TLG Attorney, Carrie N. Heieck, Esq.

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

Dominguez Hills Village is a private, gated single family home community in Carson. Residents enjoy at a clubhouse, swimming pool, basketball court and tennis courts, tot lot, entry gates, and parks and walkways.

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

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

Cerrato features spacious new homes on walkable tree-lined streets. Located a few blocks from Downtown Hollister, Cerrato offers convenient access to nearby parks, schools, shops and restaurants.

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

cs_imageThe rising cost of electricity, environmental considerations, clean energy and tax savings, utility company programs designed to help alleviate the demand on the grid, and the proliferation of affordable residential solar energy systems have made solar power more popular than ever.  Consequently, Associations are seeing a sharp rise in homeowner requests to install solar energy systems.  This presents a particularly unique set of challenges for condominium developments because of their shared roofs and other similar common area components.

Under Civil Code § 714.1, if a condo owner (“homeowner”) wants to install a solar energy system (“solar panels”) on a shared common area rooftop or adjacent garage or carport, Associations can no longer prohibit them.  California law broadly requires Associations to allow homeowners to install solar panels on common area roofs of the buildings in which their unit is located or on the roofs of adjacent carports or garages.  See Civ. Code §§ 714.1, 4600, and 4746.

Moreover, solar panel installations are an exception to the rule requiring 67 percent of membership approval before the Association grants use of any portion of a common area to a particular homeowner.  See Civ. Code § 4600(b)(3)(J).  This Civil Code exception is intended to make solar adoption in condos easier and streamline common area roof installations.

Therefore, any provision of an Association’s governing documents that effectively prohibits or materially impedes the installation or use of solar panels is deemed void and unenforceable.  For instance, Association restrictions that raise the total cost of the solar panels system by more than $1,000 or decrease its performance by more than ten (10) percent from what was originally proposed by the applicant homeowner run afoul of the law and are deemed void.

However, this does not mean that a homeowner can install as many solar panels on the common area roof as he or she desires without consideration of neighbors in the building.  Civil Code § 4746(b) provides that when reviewing a request to install a solar energy system on a multifamily common area roof shared by more than one homeowner pursuant to §§ 714 and 714.1, an Association may impose additional reasonable provisions.

Therefore, if a homeowner wants to install solar panels onto a common rooftop, the Association can require a solar site survey to help determine the breakdown of usable space among all homeowners sharing the roof for potential solar hardware.  See Civ. Code § 4746.  Because each Association is different, it is up to the Board of each Association to decide what is a fair and reasonable equitable allocation of a common area roof.  If practical, each homeowner should get a proportion of the usable roof space that would result in an equal amount of energy output.  This way, rather than the first installer of solar panels utilizing the ideal area(s) of the shared solar roof to the disadvantage of subsequent installers, the above equal allocation approach promotes solar equitable ownership and equal opportunity to the same quantity of solar energy.

If the site survey determines that a rooftop solar system would be impractical or the allocation of shared roof space is untenable, the Association could deny installation.  See Civ. Code § 4746.

In summation, while the Association may not unreasonably restrict an owner’s request and the CA statute expressly allows for such panels on common area roofs, the Association may reasonably attach a series of requirements and conditions pursuant to which the applicant homeowner must: 1) Notify the other homeowners with the shared roof of their desired solar system installation; 2) maintain a liability coverage policy at all times and provide the Association with the corresponding certificate of insurance within 14 days of approval of the application; 3) conduct a solar site survey and provide the Association with a copy of the results, which among other things shall also include a determination of the equitable allocation of the usable solar roof area among all owners sharing the same roof, garage, or carport; 4) bind the owner and all successive owners for costs of maintenance and damages with all repair responsibilities being allocated to the homeowner and his/her successor(s); and 5) require the homeowner’s disclosures to all prospective buyers (and renters) of the restrictions and responsibilities.

The above requirements notwithstanding, the Association should get ahead of potential future issues involving solar panel systems by adopting guidelines addressing the policies and procedures regarding the application and installation of solar panels.  Additionally, Boards should consider requiring the execution and recordation of a maintenance and indemnity agreement whereby the applicant homeowner assumes responsibility for the costs of repairing damage to, among other things, the common area resulting from the installation, maintenance, repair, removal or replacement of the solar panels and all related hardware.  Such an agreement should also address what happens when the System needs to be removed or re-installed to accommodate community-wide roofing projects the Association may undertake in the future.

There are further concerns and other nuances that should be considered for each individual Association to ensure full compliance with the operative laws and effectively mitigate legal exposure.

California HOA lawyers Contact your HOA attorney to conduct an in-depth analysis for your community to ensure compliance with the legal requirements and help prepare a related Solar Policy and Maintenance & Indemnity Agreement.

-Blog post authored by TLG Attorney, Sam I. Khil, Esq.

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