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Can Private Parties Restrict Parking on Public Streets?

Published on: December 1, 2021 | by Steven J. Tinnelly, Esq.

*Asked and Answered

Asked – Can Homeowners Associations Restrict Parking on Public Streets?

Answered – Possibly. The restrictions set forth in the CC&Rs are known as equitable servitudes that “run with the land.” This means that when an owner takes title to the property, he is automatically bound by the restrictions in the CC&Rs, which are recorded against his property. Those restrictions continue to burden and benefit every successive owner, who later takes title to the property.

The CC&Rs contain restrictions pertaining to the maintenance of the encumbered land, but they also contain restrictions that regulate how members can use the land. When dealing with parking restrictions that attempt to regulate the aesthetics of the community, a reasonable argument could be made that the restrictions apply to all member conduct, regardless of whether that conduct occurs on private or public streets within the development.

California courts have not yet published caselaw to address this issue. There is, however, an unpublished case from 1978, Lake Forest Community Association v. Noble (Orange County Superior Court No. 197563), in which the California Court of Appeal found that private parties can regulate parking on public streets in order to protect the association’s property values. In this case, the homeowner was parking a truck camper on the public street in front of his property in violation of the CC&Rs. The Court found that the homeowner was contractually obligated, via the CC&Rs, to refrain from parking his truck camper anywhere within the community, including the public streets.

Since this case was not published, it is not controlling law. This means that another California judge might rule differently. Although, homeowners associations have reasonable grounds to assert that the parking restrictions in their CC&Rs apply to member conduct on both public and private streets within the community in order to preserve the property values.

CC&Rs restrictions dealing with parking vary greatly from association to association; therefore, the Board of Directors should first consult with an attorney to determine whether they will be able to successfully enforce parking restrictions on public streets within the development.

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

Due Process Regarding an Association’s Disciplinary Procedures

Published on: September 29, 2021 | by Vivian Tran, Esq.

Due-Process Rules are meant to be followed. However, some homeowners unknowingly or knowingly violate these rules. What should an association do under these circumstances?

First and foremost, every association should have clear disciplinary and enforcement procedures (i.e., due process) regarding the handling of a homeowner’s violation of the association’s governing documents (Civil Code section 5850(c)). Think of associations as miniature governments in which each homeowner would have certain constitutional rights associated with their life, liberty, and property. Due process refers to the fact that in such matters, the association must provide homeowners with notice of the violation, the opportunity to be heard, and a decision upon neutral analyzation by the association (Civil Code section 5855).

For due process to be effective any disciplinary procedures and enforcement of such must be clearly delineated in a policy. The purpose of such a policy is to ensure the association will not arbitrarily or capriciously adjudicate enforcement matters. The enforcement policy should include:

The method of how to report violations, whether by a homeowner or association agent (i.e., patrol, Board member, violations committee). Usually, associations have management companies and require that all reported violations be submitted in writing or email to management first.
Clear steps on what is to occur when a violation is noted. An association might decide to send an initial courtesy violation notice to the homeowner stating the observation of a violation.

1. If so, the association should include: (1) details of the violation (i.e., when, where, who, what, how); (2) cite the association rule(s) the homeowner violated; (3) include a photo or photos of the violation; and (4) request compliance within a specific amount of days. The time period for the homeowner to rectify the violation may vary depending on the nature of the violation, but the association should always adhere to what would be considered reasonable under the circumstances. Additionally, the association should mention that should the violation not be rectified, the homeowner may be fined pursuant to the association’s fine schedule.
2. The association’s fine schedule should detail: the different categories of violations, fine to be assessed for each type of violation, and fines associated with repeated offenses. Please note that different categories of violations may have different fine schedules so that the fine fits the type of violation (e.g., short-term rental fine versus nuisance fine).

If the initial courtesy letter does not prompt the homeowner’s compliance, the enforcement policy may delineate whether the association will be sending either another violation notice detailing a shorter period of time to correct the violation OR a notice regarding the hearing when the Board is to meet to consider or impose disciplinary measures upon a member pursuant to Civil Code section 5855 and Corp. Code section 7341(d).

1. The second violation/hearing notice should detail the violation in the same manner as the initial courtesy violation notice.
2. Note that the association must notify the homeowner of a hearing in writing and deliver the notice pursuant to Civil Code section 4040 at least ten (10) days prior to the meeting at which fines may be imposed, or at least fifteen (15) days prior to the meeting at which the association may suspend the member’s common area use privileges. A homeowner must have an opportunity to be heard and present their case to the association before they may be disciplined.

If disciplinary measures or a monetary penalty is imposed, the association must provide written notification of this decision pursuant to Civil Code section 4040 within fifteen (15) days following the action.

If levying a fine upon the homeowner in accordance with the association’s fine schedule does not induce the homeowner’s compliance, the enforcement policy may then indicate legal counsel involvement. On the other hand, the enforcement policy might detail situations where the association will elect to grant a homeowner an extension of time to abate the violation OR dismiss the enforcement matter entirely due to lack of substantive evidence against the homeowner.

1. Note that in certain circumstances, the association may skip the standard enforcement procedures and involve legal counsel immediately upon notice of the violation(s) (i.e., cease & desist, dangerous situations concerning member safety, irreparable damage to association property will occur).

It is quite important for associations to have a clear enforcement policy and to strictly adhere to such policy. If the homeowner’s violation(s) remained unresolved, the association might proceed with litigation, in which case the court will scrutinize whether the association observed procedural due process. Associations should look to their general counsel to draft or update their enforcement policy and ensure their management is familiar with the policy and its execution.

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

Court Confirms, Not Everyone is Entitled to a Protected View

Published on: July 7, 2021 | by Matthew Plaxton, Esq.

*Unpublished Case

In California jurisprudence, it is well established that a homeowner “has no right to an unobstructed view over adjoining property.” (Posey v. Leavitt (1991) 229 Cal. App. 3d 1236, 1250.) Such right may, however, “be created by private parties through the granting of an easement or through the adoption of conditions, covenants and restrictions.” (Id.) And, even then, the right must be expressly stated and narrowly construed.

For example, in the recent unpublished case of Davis v. Irvine Terrace Community Association (2021) 2021 Cal. App. Unpub. LEXIS 53, an owner (“Owner”) sued the association (“Association”) and others alleging a breach of the Association’s Covenants, Conditions and Restrictions (“CC&Rs”). Owner claimed that the Association breached the CC&Rs when it approved a neighbor’s architectural application, which included the construction of a house that would obstruct Owner’s view. While the CC&Rs protect views as to landscape, fences and walls, it contained no similar protection as to houses. Owner nevertheless argued that such protection existed because of the Association’s obligation to enhance and protect “the value, desirability and attractiveness of” Owner’s property. (Id. at p. *16.) The Court rejected Owner’s argument.

In rejecting the Owner’s argument, the Court noted that the CC&Rs included no view protection as to structures such as houses; the Court was unwilling to read into the CC&Rs additional view protections based on the impact architectural modifications would have on the value, desirability and attractiveness of the Owner’s property. Moreover, the Court pointed out that neither the CC&Rs nor the Architectural Guidelines were “intended to protect individual homeowners’ interests. They are intended to protect the community as a whole.” (Id. at p. *14.) Thus, when reviewing an application for an architectural modification, an association need not consider the impact such construction will have on the interests of individual homeowners; rather, the association is only required to consider how such construction will impact the entire community.

Lastly, the Court rejected Owner’s argument that the Association failed to “subjectively consider[] whether [the structures] height and location…will cause disharmony with surrounding structures, including [Owner’s] home[].” (Id. at p. *15.) While reviewing architectural applications will necessarily include a subjective component, there is nothing preventing the Architectural Committee from making a decision based on objective criteria: “The Committee is within its discretion to decide that a proposed plan meets the criteria of “harmony of external design” if it meets certain objective criteria such as height, color, and design scheme when compared to existing structures….” (Id.)

Accordingly, the Architectural Committee was justified in approving the neighbor’s application because it satisfied objective criteria contained in the Association’s Architectural Guidelines.

-Blog post authored by TLG Attorney, Matthew T. Plaxton, Esq.

Returning to the New Normal- Post COVID: A Diary Entry by Rip Van Winkle

Published on: June 23, 2021 | by Steven J. Tinnelly, Esq.

[As written by Rip Van Winkle on June 15, 2021]

In early March 2020, I fell asleep upon drinking my favorite beverage on a California beach. When I awoke today on June 15, 2021, I am surprised to see people celebrating in the streets and face masks in the trash. Home prices are sky high and the cost of a gallon of gas is near $5. What happened during my slumber?! Everything looks normal to me – but is it? Help!

On June 15, 2021, the state of California fully reopened under the New Normal. According to the state’s web site, Governor Newsom terminated “the executive orders that put into place the Stay Home Order and the Blueprint for a Safer Economy.” Previously, it noted that beginning June 15, 2021, all sectors listed in the current Blueprint Activities and Business Tiers Chart may return to usual operations…” How will the state’s reopening plan affect HOAs throughout the state? The purpose of this article is to briefly summarize what some have described as the New Normal – and to address whether HOAs can reopen without restrictions.

The New Normal

COVID-19 continues to be present in smaller numbers throughout the state. The Centers for Disease Control (“CDC”) states that some vaccinated people will still get sick because “no vaccines are 100% effective” and provides that it is “still learning how long COVID-19 vaccines protect people.” Data suggests that some California citizens remain unvaccinated. As of June 17, 2021, the California Department of Public Health (“CDPH”) maintains that the “risk for COVID-19 exposure and infection will remain until we reach community immunity from vaccinations, especially in communities heavily impacted by COVID-19.”

Now that the state will no longer be subject to the state’s COVID-19 health guidelines, does that mean that HOAs can return to pre-COVID operations under the New Normal without regard to prior and existing health recommendations? Not necessarily.

Since the Governor’s March 2020 Executive Order, the state has largely deferred to health mandates imposed by local counties. While the state may have lifted its Blueprint for a Safer Economy, it is possible that some counties may continue to impose COVID-19 limitations for their local populations based upon their respective COVID-19 metrics. “Nothing in this Order shall be construed to limit the existing authority of local health officers to establish and implement public health measures within their respective jurisdictions that are more restrictive than…the public health measures imposed on a statewide basis pursuant to the statewide directives of the State Public Officer.” (Executive Order N-07-21 dated June 11, 2021). Accordingly, it is advisable for HOAs to review local requirements before deciding to resume pre-COVID business (i.e., reopening facilities and holding in-person Board meetings, among other things).

The state’s decision to fully reopen potentially creates confusion regarding the application of health guidelines and safe practices. Fortunately, the Centers for Disease Control (“CDC”) provides a default framework for community associations to evaluate as they reopen throughout the state.

Liability Considerations

During the New Normal, boards of directors and management professionals should not overlook the CDC’s COVID-19 guidance, particularly because reviewing that material could help to prevent liability exposure for the Association. The CDC provides guidance for shared or congregate housing, and multifamily housing (e.g., condominiums and townhouses). The principles from those resources could apply to resident gatherings within community associations, such as in-person board meetings and community events. The CDC web site includes COVID-19 instruction for many daily activities that are fixtures within HOA communities, such as gyms or fitness centers, playgrounds, and pools. HOAs would be well served by considering the adoption of safeguards which appreciate the CDC’s guiding principles in those contexts (i.e., encouraging social distancing and mask wearing; sign posting; and resident education, etc.) because the landscape in 2021 is much different than it was in 2019.

Community associations possess the obligation to discharge their legal responsibilities in accordance with certain standards of care. They can be responsible for harms to third parties if their conduct is considered to be negligent by acting or by failing to act (CACI 400). Negligence is defined as “conduct which falls below the standard established by law for the protection of others against unreasonable risk of harm.”(Restatement Second of Torts, section 282). In general, one is required to exercise the care that a person of ordinary prudence would exercise under the circumstances. The California Supreme Court held the following: “Because application of [due care] is inherently situational, the amount of care deemed reasonable in any particular case will vary, while at the same time the standard of conduct itself remains constant, i.e., due care commensurate with the risk posed by the conduct taking into consideration all relevant circumstances (Flowers v. Torrance Memorial Hospital Medical Center (1994) 8 Cal.4th 992, 997).

Notwithstanding the state’s reopening, the amount of care now exercised by HOAs might require a greater appreciation or awareness of safe procedures, in view of the present COVID-19 risk and current health standards. CDC and state/local guidelines, to the extent available, provide detailed guidance that can be considered in that regard. Below are suggested practices for some common HOA functions:

HOA Function

Recommended Practice

Indoor Board Meetings

Face Mask Coverings – see CDPH’s “Guidance for the Use of Face Coverings – Effective June 15, 2021”, or applicable County guidelines, whichever is stricter. Click here for our recent blog post regarding face mask coverings.

Holding Gatherings – see CDC guidance.

Maintenance of Common Area Amenities

Continuance of enhanced cleaning and disinfection practices – beyond those practices in place before the March 2021 Stay at Home Order.

Maintaining Healthy Environments – see CDC Guidance.

Rejoice! It looks like we may be close to the light at the end of the tunnel. Much has changed since I fell asleep. What appears to be normal may not be. I know that I can ask my trusted HOA lawyer for assistance as I take measures to protect my community – but maybe not at the beach… RVW

-Blog post authored by TLG Attorney, Kumar S. Raja, Esq.

California is Reopening – But What Does That Mean for HOAs?

Published on: June 15, 2021 | by Carrie Heieck, Esq.

201167609_10158535966747582_6734223399279805886_n As of June 15, 2021, Governor Newsom terminated the executive orders that created the Stay-at-Home Order and the Blueprint for a Safer Economy. These orders have been replaced with and superseded by a new State Public Health Officer Order of June 11, 2021 (“Current Order”). This New Order requires all individuals, regardless of vaccination status, to wear face coverings: 1) on public transit; 2) indoors in schools and in childcare; 3) in healthcare settings; 4) in correctional facilities and detention centers; and 5) in homeless and emergency shelters. Vaccinated people may now forego face coverings in public places, including indoors, but unvaccinated persons must still wear face coverings in these locations.

The vast majority of HOAs are not open to public as their common area amenities and facilities are for the use of residents and their guests only. The Current Order, by its plain language, does not apply to these private businesses, which means that HOAs not open to the public are free to adopt their own reasonable rules related to face coverings and social distancing in common areas while the COVID-19 pandemic continues. Although progress has been made in vaccinations and in reducing community transmission, the pandemic is still ongoing, and the risks are still very real. However, the lifting of the state mandates and improved conditions means that HOAs are opening their community facilities and loosening restrictions on their use.

HOAs are tasked with various responsibilities and obligations to ensure the continued operation and well-being of the Association. Those obligations include keeping common areas safely maintained. The Association must continue to fulfill these obligations despite the lifting of governmental mandates through the adoption of reasonable rules.

It is arguably reasonable for HOAs to mirror the provisions of the Current Order when opening community facilities, although HOAs can choose to be more restrictive if the Board determines this course of action to be in the Association’s best interest. However, only lifting masking requirements for vaccinated persons creates significant enforcement difficulties. Specifically, it forces the HOA to ask people if they are vaccinated. While asking persons if they are vaccinated is lawful (HIPAA is only applicable to healthcare providers), many will consider answering questions concerning their private health information an invasion of their privacy and by that same token, may refuse to answer. The law does not require anyone to answer such a question.

Moreover, an unvaccinated person could simply lie. Asking for vaccination cards poses the same dilemma and is arguably an even more egregious invasion of privacy. The administrative costs of implementing a registry of vaccinated versus non-vaccinated persons is also a concern as is monitoring who must and who may not wear masks at the facilities at any given time. Furthermore, vaccination is not fully achieved until two (2) weeks after the second dose in a 2-dose series, such as the Pfizer or Moderna vaccines, or until two (2) weeks after a single-dose vaccine, such as Johnson & Johnson’s Janssen vaccine. Determining when individuals received their shots adds an additional and undesirable layer to the screening and questioning process.

An additional concern is that some persons may not be vaccinated because of a medical condition or because of their religious beliefs which raises potential discrimination issues related to vaccine verification and questioning. Therefore, some HOAs are implementing an “honor system” in the form of a rule or policy that requires residents and guests who are not vaccinated to wear masks and allows those who are vaccinated to use the facilities without masks and without the HOA questioning or requiring proof. This model obviously carries the risk that an unvaccinated person will use the facility without a mask.

Another arrangement is to simply require all residents and guests to wear masks in the common area regardless of vaccination status, unless they are sunbathing, exercising, etc. This policy can be combined with social distancing requirements and sanitization efforts to provide increased safety and protection to facility users. Many businesses open to the public are still requiring the wearing of masks and may continue to do so for the protection of their customers even if the state or county does not mandate such measures. This model also eliminates the administrative costs and hassle of the screening and policing of mask-wearing for the unvaccinated only and reduces liability for those who feel discriminated against or otherwise wronged by an intrusive vaccine verification or questioning policy.

Regardless of the rules adopted by an HOA to protect residents from COVID-19 transmission, it is advisable for an HOA to post notices in community facilities advising users of the risks and that by using the facility, they agree to assume such risks. Depending on the policy adopted by the HOA regarding mask wearing, said notice should also reiterate face covering requirements for the facility’s use. The requirement for users to sign waivers prior to using the facilities is still a potential option to add an extra layer of protection, but HOA’s should discuss the use of waivers with their legal counsel which takes that HOA’s location and unique characteristics into account. While not a guarantee that the HOA will not be sued if someone catches COVID-19 in a common area, such measures may help mitigate the Association’s legal exposure resulting from reopening.

HOAs should contact their legal counsel to prepare appropriate rules and policies for reopening in light of the Current Order.

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

Hostile Homeowner Harassment

Published on: May 5, 2021 | by Steven J. Tinnelly, Esq.

*Asked & Answered

Asked – How should our HOA handle a hostile homeowner who is being abusive to other residents and overwhelms management staff with endless emails and other harassing communication?

Answered – We previously blogged about workplace harassment and hostile work environments for management professionals. Unfortunately, harassment in Associations is becoming increasingly common these days. The COVID-19 pandemic-related difficulties has only heightened tensions and exacerbated this problem by further triggering those with a propensity for such hostile behavior and visceral outbursts.

While most Community Managers have had some experience dealing with abusive homeowners, hostile homeowners tend to exhibit unrelenting behavior that is challenging and highly disruptive notwithstanding management’s best efforts and great work on behalf of the community. They tend to inundate management staff with incessant and baseless complaints regarding perceived or self-inflicted issues, frivolously question Board actions, and are frequently the primary source of widespread tensions that lead to controversies with other residents.

One helpful guiding principle when encountering such hostile homeowners, is to step back and remember that the management company was hired to serve as the managing agent for the Association. Thus, Management’s primary responsibility is to implement the Board’s directives and to serve as a communications liaison between the Board and the residents. For the most part, substantive decisions are made by the Board at the monthly Board meetings. Recognizing this dynamic can assist management staff and the Board when encountering confrontational homeowners. Thus, when responding to emails or other correspondence from such homeowners, Management can simply acknowledge receipt of the communication, thank the homeowner, and advise them that the Board values resident communication relating to Association business and that you understand their concerns and will forward their communication to the Board for review at the next Board meeting. Then, timely engage the Association’s legal counsel to deal with the problem and to protect the Association’s interests.

If the compulsive emailing or hostile communications persists, then the homeowner can be informed that his/her emails will be blocked by Management and if they wish to send written communication, they send a letter to Management, and it will be placed in the Board packet to be reviewed by the Directors at the next scheduled Board meeting.

While the hope is that Management can get the hostile homeowner under control while memorializing the Association’s good faith efforts to avoid any escalation, the reality is that an overwhelming majority of homeowners who exhibit hostile tendencies will remain unyielding and continue on their ill-advised path until confronted with more serious financial and/or legal ramifications.

Therefore, it is very important that the Board of Directors and Management get the Association’s legal counsel involved as soon as possible in the process. Particularly, the Board should have the Association’s legal counsel send the offending homeowner a formal Cease and Desist letter that fully articulates the misconduct, outlines the basis for the violation, and puts the homeowner on notice that they will be subject to fines and possible legal action if the troubling conduct and violation are not immediately ceased. The letter should preferably also suggest an alternative means of dealing with the purported underlying problem. While this approach generally reaches a good number of offending homeowners, some will inevitably remain undeterred by the formal letter.

If the hostile behavior persists, the Board should consider holding a hearing and start levying fines. Thereafter, and depending on the severity of the ongoing homeowner misconduct, the Board may consider initiating an Internal Dispute Resolution process, or sending a further demand for compliance coupled with a pre-litigation offer of alternative dispute resolution (ADR). These steps will generally resolve the majority of violations and behavioral issues.

However, if the homeowner lacks any appreciation for the preservation of his/her financial and legal interests and the bad behavior persists, the Board should seek judicial relief by way of a restraining order, suing the hostile homeowner, and seeking recovery of its legal fees and costs pursuant to the Association’s Declaration. Our expert attorneys stand ready to answer your questions, help resolve your matter involving hostile homeowners or other difficulties, and ensure that the Association’s interests are always protected.

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

Addressing Neighbor-to-Neighbor Disputes

Published on: February 10, 2021 | by Steven J. Tinnelly, Esq.

116390863_l-1024x683-1 Neighbor-to-neighbor disputes are on the rise. These types of homeowner conflicts are typically characterized as governing document violation complaints that are personality conflicts between neighboring homeowners rather than legitimate concerns that impact the Association and its membership more broadly. Refereeing these squabbles can quickly become burdensome and costly for an Association and its volunteer Board where the complaining homeowner is attempting to use the Association’s enforcement authority as a weapon against their neighbor. Accordingly, Associations plagued with complaints over these types of homeowner tiffs should consider setting clear limits to their involvement in such matters.

Management companies and Boards often receive homeowner complaints for alleged violations that are not easily discernable through a visual inspection of the community. A common neighbor-to-neighbor dispute is a noise complaint like a barking dog or an upstairs disturbance where no other neighbors have complained of the noise and where there are no other witnesses to the alleged ruckus. These complaints are often repetitive, adding to their burdensome nature. Initially, the Board has a duty to investigate the alleged violation, which often falls under a general nuisance provision in the CC&Rs. However, if after investigation, the Board does not find demonstrable or credible evidence that a nuisance or other governing document violation exists, such as where the only evidence is one neighbor’s word against another’s, the Board is well within its authority to deem the matter a neighbor-to-neighbor dispute and to exercise its discretion to decline further action. Failing to exercise restraint in intervening in these disputes could result in problems for the Association by increasing its operational burdens, and by having the balance of its membership subsidize (via their assessments) the resolution of isolated disputes between feuding neighbors that have no bearing on the Association or on a significant portion of its membership.

Declining to intervene in a neighbor-to-neighbor dispute does not leave homeowners without recourse. Each homeowner may enforce the governing documents in their individual capacity against other homeowners (Civ. Code 5975(a)). Depending on the situation, they may also contact local law enforcement, animal control, or request appropriate relief in the civil court. While the complaining homeowner may object to the Association’s use of its discretionary power to decline intervening, “anyone who buys a unit in a common interest development with knowledge of its owners association’s discretionary power accepts the risk that the power may be used in a way that benefits the commonality but harms the individual.” Nahrstedt v. Lakeside Village Condominium Association, Inc. (1994) 8 Cal.4th 361, 374.

Due to uncertainties in determining what constitutes a neighbor-to-neighbor dispute and when to (and when not to) intervene, Boards are encouraged to contact their legal counsel to discuss adopting a Neighbor-to-Neighbor Dispute Policy. Such a policy may be drafted in a manner to prevent the Association’s involvement in a Neighbor-to-Neighbor Dispute until such time as the complaining homeowner demonstrates their willingness to expend their own resources in trying to work out a resolution directly with their neighbor through requiring participation in Alternative Dispute Resolution (“ADR”) before the Board will consider involvement.

Boards are cautioned that legitimate complaints by residents of harassment on the basis of their membership in a protected class are not neighbor-to-neighbor disputes and must be investigated and addressed. See Code of Fed. Reg. §100.7(a)(1)(iii). California HOA’s have been deemed housing providers under the law for purposes of requiring their compliance with this statute. Boards are encouraged to discuss adopting an Anti-Harassment Policy with their legal counsel to address these types of complaints.

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

Lawsuits Against HOAs are Generally a Protected Activity

Published on: December 9, 2020 | by Steven J. Tinnelly, Esq.

*New Case Law

Under California law, a Strategic Lawsuit Against Public Participation (“SLAPP”) is a lawsuit brought against a defendant as a form of punishment for engaging in protected activities. When such lawsuits are filed, the defendant may bring an “anti-SLAPP” motion to strike the plaintiff’s suit. In order to prevail on such a motion, the moving party must demonstrate that the plaintiff’s lawsuit arises from its protected activities. Once the moving party has made such a demonstration, the plaintiff may defeat the motion by showing the lawsuit has merit. Such a battle was recently fought in the case of Third Laguna Hills Mutual v. Joslin. ((2020) 49 Cal. App. 5th 336 (“Third Laguna”).)

In Third Laguna, a homeowners’ association, Third Laguna Hills Mutual – an active adult community (“Association”), brought an action against a homeowner, Jeff Joslin (“Owner”), alleging, among other things, violations of the Association’s governing documents. Joslin had apparently rented out his separate interest to unqualified persons (i.e., “nonseniors”) who then caused nuisance violations (e.g., playing loud music). In response, Joslin filed a cross-complaint against the Association, alleging various tort theories. The Association labeled Joslin’s cross-complaint as a SLAPP suit and filed an anti-SLAPP motion.

In support of its anti-SLAPP motion, the Association argued that Owner’s cross-complaint was in response to the Association’s “protected activities and communications;” in other words, the “pre-litigation threats and the filing of” the Association’s lawsuit. The Association further argued that enforcement of the Association’s CC&Rs “is a public issue and an issue of public interest” falling within the ambit of the anti-SLAPP statute. The Court disagreed, siding with the in pro per Owner.

In denying the Association’s anti-SLAPP motion, the Court reasoned that the tort claims alleged in Owner’s cross-complaint clearly “arose from the [Association’s] decisions and actions” (e.g., preventing Owner from renting out his unit), not “from the [Association’s] filing of the complaint.” Moreover, and although the Association is relatively large, enforcement of the CC&Rs “is not a public issue or an issue of public interest within the meaning of the anti-SLAPP statute.” Because Owner prevailed, he was awarded his costs on appeal.

This case is important because it highlights the need for a HOA to perform a careful and thorough evaluation, not only of the merits of a lawsuit prior to filing, but of all subsequent procedural actions taken during the pendency of the lawsuit.

-Blog post authored by TLG Attorney, Matthew T. Plaxton, Esq.

Damage to Party Walls – Who is Responsible?

Published on: October 28, 2020 | by Steven J. Tinnelly, Esq.

*Asked & Answered

Asked – Our association has two homeowners that have requested the association’s intervention to assist with resolving a dispute that has arose from damage to a shared wall. Should the Board get involved? Does the Association have any responsibility to cover the cost to repair the shared wall?

Answered – As a general matter, the Association is not obligated to intervene in this neighbor-to-neighbor dispute and is not responsible for covering the cost of the damage to the shared wall (“Party Wall”).

California Civil Code § 4775 provides the general allocation of maintenance responsibilities between associations and individual homeowners as follows, “unless otherwise provided in the declaration of a common interest development, the association is responsible for repairing, replacing, and maintaining the common area.” (Civ. Code § 4775(a)(1). Emphasis added.) The code further provides that “[u]nless otherwise provided in the declaration of a common interest development, the owner of each separate interest is responsible for repairing, replacing, and maintaining that separate interest.” (Id. at (a)(2). Emphasis added.)

In this situation, the damaged Party Wall is located between two private lots, not on the Association common area. As such, absent any provision in the association’s governing documents to the contrary, the association has no obligation to repair the Party Wall.

This point is further clarified by California Civil Code § 841(a), which states, in pertinent part: “[a]djoining landowners shall share equally in the responsibility for maintaining the boundaries and monuments between them.” Which, necessarily, would include the damaged Party Wall. This maintenance obligation extends to “reasonable costs of construction…or necessary replacement of the fence.” (Civ. Code § 841(b)(1).)

There may be circumstances where the Board of Directors (“Board”) may sympathize with the homeowners and want to intervene (eg. the damage to the Party Wall was no fault of the homeowners). While this feeling is valid and shows the Board’s virtues, the Board should remember that they are fiduciaries of the Association and must act in the best interests of the association as a whole.

The Board lacks the authority to expend association funds to repair the damaged Party Wall. The association levy’s and collects assessments from its owners for various reasons including among other things, promoting its members’ welfare, improving and maintaining association property, and discharging association obligations under their governing documents. However, covering the cost of the Party Wall, which is a separate interest, would be outside the scope of the association’s authority.

Thus, the association has no obligation or authority to intervene with this dispute and make the repairs to the damaged Party Wall. That burden lies solely with the homeowners.

In addition to the above, prudent associations adopt neighbor-to-neighbor dispute policies to offset many disputes that can likely be resolved with effort between the homeowners.

-Blog post authored by TLG Attorney, Corey L. Todd, Esq.

SB-908 Signed! Debt Collection Licensing Act

Published on: October 1, 2020 | by Steven J. Tinnelly, Esq.

*New Legislation

Existing state law provides for the Rosenthal Fair Debt Collection Practices Act (the “Rosenthal Act”), California’s state equivalent of the Fair Debt Collection Practices Act (“FDCPA”). Like the FDCPA, the Rosenthal Act prohibits debt collectors from engaging in specified abusive, unfair, or deceptive practices to collect debts. Violations of the Rosenthal Act are enforceable through a private right of action.

Additionally, existing California State law provides for the Fair Debt Buying Practices Act (“FDBPA”; Civil Code Section 1788.50 et seq.), which requires persons that purchase delinquent or charged-off consumer debt to maintain, and provide upon request, specified documentation proving that the alleged debtor is the individual associated with the original contract or agreement, and that the amount of indebtedness is accurate, among other requirements.

On September 25, 2020, Governor Newsom signed Senate Bill 908, the Debt Collection Licensing Act (“SB 908”), which creates a new licensing law applicable to debt collectors and debt buyers, administered by the Department of Business Oversight (“DBO”), effective January 1, 2022. Moreover, SB 908 provides for licensure regulation, oversight of debt collectors, definitions of terms, application requirements (including criminal background checks), maintaining surety bonds, and other related changes.

SB 908, sponsored by Senator Wieckowski, was presented to ensure greater consumer protection through enhanced oversight over debt collectors and debt buying entities within California. The bill utilizes the foundations contained within the Rosenthal Act and FDBPA.

The goal of SB 908 is to add new a layer of regulatory oversight over debt collectors and debt buyers already subject to state law, but not currently subject to licensure. With the adoption of the bill, debt collectors and debt buying entities must apply for and be approved for a license by the Commissioner of Business Oversight. By requiring debt collectors and debt buyers to comply with licensing requirements, the belief is that the State will be better situated to ensure compliance with existing law.

As for remedial measures, the Rosenthal Act and the FDBPA already authorize private rights of action for violations of these acts. As such, SB 908 contains a limited set of administrative remedies, including desist and refrain authority, the ability to order ancillary relief, and the ability to suspend and revoke licenses. According to the Senate, the lack of civil and administrative penalty authority and citation and fine authority in SB 908 is intended to prevent situations where a licensee could be subject to both a lawsuit by a debtor and to an administrative or civil action brought by DBO for the same violation.

The adoption of SB 908 has several important implications for Homeowners Associations (“HOA”). Notably, the new licensing requirement applies to natural persons, partnerships, corporations, limited liability companies, trusts, estates, cooperatives, associations, and other similar entities. This includes law firms and management companies involved in the collection of debt, including the collection of delinquent assessments. Thus, this bill directly impacts which entities may manage the HOA’s assessment collections.

Considering the foregoing, and to avoid the various penalties provided for in SB 908 (i.e. refunds, restitution, disgorgement, and payment of damages, as appropriate, on behalf of a person injured by the improper conduct) all HOAs should ensure that their designated collection vendors are properly licensed by the DBO by January 1, 2022.

-Blog post authored by TLG Attorney, Corey L. Todd, Esq.