HOA Lawyer Blog

Business Judgment Rule Doesn’t Apply When the Board Acts Outside its Authority

Published on: June 14, 2017 | by Steven J. Tinnelly, Esq.

*Unpublished Case

ISSUE:

Is an HOA Board of Directors (“Board”) entitled to protection under the Business Judgment Rule (“BJR”) when it applies an unambiguous view restriction contained in the governing documents in a manner other than written?

RULE:

No. In Lingenbrink v. Del Rayo Estates Homeowners Association, 2017 WL 1075062 (“Lingenbrink”), the Court of Appeal concluded the BJR only applies to matters that are within an HOA Board’s discretion. A Board does not have the discretion to interpret or re-write a restriction where the meaning of the restriction is perfectly clear.

ANALYSIS:

The HOA consists of eighteen (18) “high end” homes in Rancho Santa Fe built on 21 lots, each with sweeping views of the Pacific Ocean. The CC&Rs contain very specific language that protects each Lot’s view as follows:

“No tree, hedges or other plant shall be so located or allowed to reach a size or height which will interfere with the view from any Lot and, in the event such trees, hedges or other plant materials do reach a height which interferes with the view from another Lot, then the Owner thereof shall cause such tree(s), hedge(s) or other plant material[(]s) to be trimmed or removed as necessary.”

New Client: Presidential Heights Community Association No. 2

Published on: May 23, 2017 | by Steven J. Tinnelly, Esq.

Presidential-Heights-II We are proud to announce that Presidential Heights Community Association No. 2 has selected Tinnelly Law Group as their associations’ legal counsel.

Presidential Heights is a condominium community located above the San Clemente Municipal Golf Course, in close proximity to Vista Bahia Park, and a variety of hiking and biking trails. Residents enjoy multiple pools, spas, and panoramic coastal and city lights views.

Our HOA attorneys and staff look forward to working with Presidential Heights’ Board and management.

New Client: Tidelands Owners Association

Published on: May 16, 2017 | by Steven J. Tinnelly, Esq.

We are proud to announce that Tidelands Owners Association has selected Tinnelly Law Group as their associations’ legal counsel.

Tidelands is a brand new condominium community by The New Home Company. Located in San Mateo, Tidelands offers the very best of waterfront living. Its modern residences provide homeowners a rare opportunity to live in the heart of the San Francisco Peninsula with easy access north to the city or south to Silicon Valley. In addition to a great climate, San Mateo boasts numerous parks making it easy to enjoy a healthy outdoor lifestyle. Residents will enjoy a Club Room, Fitness Center, and views of the San Mateo wetlands, bay and city skyline.

Our HOA attorneys and staff look forward to working with Tidelands’ Board and management.

Swallows Nests are Protected by the Migratory Bird Act

Published on: May 9, 2017 | by Steven J. Tinnelly, Esq.

*Asked & Answered

Asked – I’m receiving calls regarding swallows nests. Folks want them removed. Pest control is reminding everyone they are protected and removing is punishable by law. We are in high time for swallow activity! Is there anything our HOA can do to address this issue?

Answered – All swallows and their nests are fully protected under the “Migratory Bird Treaty Act of 1918” by state and federal regulations. It is illegal for any person to intentionally kill, injure, take, possess, transport, sell, or purchase them or their parts. It is illegal to intentionally destroy the nest, eggs or young of a swallow without a permit. If an adult swallow is occupying a half-built nest, or a fully built nest without eggs, then the law protects it. A permit is not required to remove swallow nests under construction that do not contain an adult, any new eggs or young, or nests abandoned after the breeding season. Permits to kill swallows or destroy swallow nests are only issued by the U.S. Fish and Wildlife Service, and only in very extreme cases. An example would be concerns for aircraft safety from a nesting colony at an airport. In most cases a permit for lethal control of swallows will not be issued for swallows nesting on a residence or other buildings and causing aesthetic damage.

The best strategy appears to be preventing nest building by “exclusion”, meaning methods that deny physical access to the nest site area. Exclusion represents a relatively permanent, long-term solution to the problem, and California does not require a permit for this method if it is done before the birds arrive, during nest building when there are no eggs or young in the nest or after the birds have left for the winter.

For methods of exclusion, please see the article “Living with Wildlife” published by the Washington Department of Fish & Wildlife.

-Blog post authored by TLG Attorney, Terri A Morris, Esq.

New Client: Lanai Owners Association

Published on: May 2, 2017 | by Steven J. Tinnelly, Esq.

Lanai We are proud to announce that Lanai Owners Association has selected Tinnelly Law Group as their associations’ legal counsel.

Lanai is a brand new single family home community by Shea Homes. Located one mile from the Pacific Ocean Beaches in the heart of Carlsbad, residents will enjoy ocean views and easy access to beaches, entertainment, shopping, and dining.

Our HOA attorneys and staff look forward to working with Lanai’s Board and management.

New Client: Heirloom Community Association

Published on: April 25, 2017 | by Steven J. Tinnelly, Esq.

We are proud to announce that Heirloom Community Association has selected Tinnelly Law Group as their associations’ legal counsel.

Heirloom is a brand new townhome community by The New Home Company. Heirloom at The Cannery presents an extraordinary opportunity to reside in California’s first farm-to-table new home community. Heirloom received the prestigious “Community of the Year” honor at the 2016 MAME Awards presented by the North State Building Industry Association. The idea for living at The Cannery in Davis is pure and natural: Surround homes with parks and a working farm. Residents enjoy an urban garden, producing farm, market, pool and ranch clubhouse.

Our HOA attorneys and staff look forward to working with Heirloom’s Board and management.

Governor Brown Declares the End of the Drought

Published on: April 20, 2017 | by Steven J. Tinnelly, Esq.

water-rain-raindrops-drops

On April 7, 2017, Governor Brown signed Executive Order B-40-17, ending the drought state of emergency in most of California. Drought restrictions will remain in effect in Fresno, Kings, Tulare, and Tuolomne counties, which continue to face drinking water shortages and diminished groundwater supplies. The new Executive Order rescinds the emergency proclamations from January and April 2014, along with four drought-related executive orders.

Over the last few years, the California legislature has passed several bills aimed at water conservation within community associations. AB 2100 amended Civil Code Section 4735 to prohibit associations from fining or threatening to fine an owner for failing to water vegetation or lawns during a state or local government-declared drought. SB 814 also authorized penalties for excessive residential water use during periods of government-declared droughts. Now that the state of emergency has been lifted, these laws are no longer in effect, provided the local jurisdiction has not declared a local drought.

AB 2104 further amended Section 4735 to restrict an association from prohibiting low-water using plants as a group, and AB 349 amended Section 4735 to restrict an association’s authority to prohibit artificial turf. Although the drought restrictions have been lifted, this legislation protects homeowners from having to reverse or remove any landscaping measures that were installed in response to the government-declared drought.

The State Water Resources Control Board (SWRCB) also adopted emergency regulations that subject associations to fines of up to $500 per day for violating the provisions of Section 4735. These regulations will remain in effect until November 25, 2017, or until they are modified or repealed by SWRCB.

The decision to lift drought restrictions was partly based on unprecedented water conservation. Californians saved more than 20% of urban water since the Governor mandated water use reductions in 2015. Despite the record levels of water conservation, the State cautions, “This drought emergency is over, but the next drought could be around the corner,” said Governor Brown. “Conservation must remain a way of life.”

Executive Order B-40-17 continues the provisions in the previous Executive Order, “Making Water Conservation a California Way of Life.” Permanent restrictions prohibit the use of potable water for:

hosing off sidewalks, driveway and other hardscapes;
washing automobiles with hoses not equipped with a shot-off nozzle;
using non-recirculated water in a fountain or other decorative water feature;
watering lawns in a manner that causes runoff, or within 48 hours after measurable precipitation; and
irrigating ornamental turf on public street medians.

The SWRCB will continue to plan for future droughts and promote water conservation as a way of life, which may result in more legislation.

Blog post authored by TLG Director of Business Development, Ramona Acosta.

New Client: Tres Vistas Homeowners’ Association, Inc.

Published on: April 18, 2017 | by Steven J. Tinnelly, Esq.

Tres-Vistas We are proud to announce that Tres Vistas Homeowners’ Association, Inc. has selected Tinnelly Law Group as their associations’ legal counsel.

The Tres Vistas community surrounds Lake Mission Viejo with 64 custom built homes within the gates of this gorgeous location. Residents enjoy lakefront resort style living with beautifully maintained grounds throughout. Amenities include a small private beach for swimming, two other large beaches, boating with docking available, community tennis courts, several sports courts, ballparks, barbecue w/picnic tables, RV boat storage, and a clubhouse with free concerts in the summer.

Our HOA attorneys and staff look forward to working with Tres Vistas’ Board and management.

Access to HOA Membership List Must be for a Proper Purpose

Published on: April 10, 2017 | by Steven J. Tinnelly, Esq.

*New Case Law

As part of the ongoing management of a homeowners association (“HOA”), the HOA is obligated to prepare and maintain certain “association records,” most of which must be made available for inspection by the HOA’s members. However, the right to inspect and copy certain association records is not absolute, as some records may be withheld from a member for confidentiality concerns, as well as in situations where the member requesting the records is doing so for an “improper purpose”:

“association records, and any information from them, may not be sold, used for a commercial purpose, or used for any other purpose not reasonably related to a member’s interest as a member.” (Civ. Code § 5230; see also Corp. Code §§ 8330, 8333.)

This “proper purpose” requirement was recently the focus of a challenge brought by a member of a HOA who sought to inspect and copy the HOA’s membership list. In Tract No. 7260 Association, Inc. v. Parker (2017) 2017 Cal. App. LEXIS 265 (“Parker“), the Court of Appeal concluded that the HOA was justified in withholding the membership list despite the member’s offering of a facially valid reason for his request to inspect the membership list. The member was involved in a corporation that the HOA was suing, called “Fix the City.” The member claimed that he sought the membership list “for possible communication with the [HOA’s] members to ascertain whether there had been corporate misdeeds.”

The HOA denied the request, arguing that the member was seeking inspection of the membership list in order to give Fix the City an unfair advantage in the lawsuit between it and the HOA. The trial court considered the facts at issue, and concluded that the member’s request was indeed improper, stating that “a reasonable conclusion is that [the member] is using his membership status to aid Fix the City in defending the [HOA/Fix the City] lawsuit.”

This aspect of the trial court’s ruling was affirmed on appeal. The Court in Parker noted that, while the HOA has the burden of demonstrating that the member will use the record for an improper purpose, and that mere speculation of an improper purpose is insufficient to justify withholding records, the HOA provided sufficient evidence that the requesting member did indeed seek the information for an improper purpose—namely, to aid Fix the City’s defense in the lawsuit brought against it by the HOA.

The Parker case underscores the importance of evaluating a member’s request for association records to determine whether the requested record(s) will be used for an improper purpose (i.e., to advance the member’s interests at the expense of the HOA’s). If the purpose is improper, and that conclusion is supported by more than simple conjecture, the HOA may lawfully deny the request. HOA Boards and managing agents that are concerned about the underlying motivations of a member’s request for association records should consult with the HOA’s legal counsel as to what records may (and indeed should) be withheld in order to protect the HOA.

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

New Client: San Lorenzo Village Homes Association

Published on: April 6, 2017 | by Steven J. Tinnelly, Esq.

new-client-PSD-file-to-edit We are proud to announce that San Lorenzo Village Homes Association has selected Tinnelly Law Group as their associations’ legal counsel.

Situated just east of San Francisco, San Lorenzo is an appealing, family focused community consisting of 5714 single-family homes covering 2.8 square miles. Built in 1944, San Lorenzo is one of the first planned developments in the United States. Residents enjoy close proximity to wine country and the Bay Area.

Our HOA attorneys and staff look forward to working with San Lorenzo’s Board and management.

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