Signing Contracts

WHO SHOULD SIGN
CONTRACTS?


QUESTION: Who is supposed to sign contracts with vendors? An attorney once told me that any board member can sign a contract, so long as the board approves. Our treasurer insists the president is the only one who can sign the contract. Who is correct?

ANSWER: The attorney is correct.

One Signature. A contract signed by any officer, whether authorized or not, will be deemed valid if the vendor reasonably relied on the signature. In addition, an association can be bound by a single signature or no signature if the association partially performed the contract’s obligations, or accepted the benefits of the contract, or subsequently ratified the contract in its meeting minutes.

Two Signatures. How can vendors protect themselves from a rogue director signing agreements? The Corporations Code calls for two signatures from officers–one signer being the president or vice president and the other one the secretary or treasurer. (Corp. Code §7214.) In the event the corporation were to challenge the authority of the signers and attempt to void the contract, the signatures of two officers…

provides a conclusive…evidentiary presumption of authority on the part of the specified corporate officers to execute the document in question on behalf of the corporation. (Snukal v. Flightways Manufacturing, Inc. (2000) 23 Cal.4th 754, 783.)

Minutes. If officers wish to protect themselves against claims they acted without authority, they should ensure meeting minutes record the board’s approval of the contract and their authorizing of officers to sign it.

Signature Blocks. To protect officers against the perception they are personally signing a contract on their own behalf (making them personally parties to the contract), the signature block should have the name of the association as the party followed by the name and title of the officer signing on behalf of the association. For example:

The Sunrise Homeowners Association, Inc.

By: __________________________
John Doe, President

This makes it clear the HOA is a party to the contract, not the president. There should be additional language in the opening paragraph of the contract identifying the association, not the officers, as parties.

RECOMMENDATION: To avoid expensive legal problems, all contracts should be reviewed by legal counsel. To reiterate, ALL contracts should be reviewed by legal counsel.

FEEDBACK


Board Packets.  Do former board members have to return board packets they had during their term or can they keep them and do with them what they want? -William C.

RESPONSE: Past directors cannot do whatever they want with board packets since they often contain sensitive information. Past directors have three options: (i) return them to the association, (ii) shred them, or (iii) keep them in a secure location and visit them each night to reminisce about their glory days as board members.

Mailbox Rule. When was the Civil Code on the ‘mailbox rule’ written – during Ben Franklin’s era? The proper term would be ‘letter carrier’ or ‘mail carrier’, NOT ‘postman.’ In case you didn’t notice, many ‘postmen’ are women!! :-)  -Beth B.

RESPONSE: Much of of the Code was drafted in the 1800’s–gunfighters, railroads and no emails. The good old days.


 
Adrian Adams, Esq.
ADAMS | STIRLING
A Professional Law Corporation

We’re friendly lawyers–boards and managers can reach us at (800) 464-2817 (800) 464-2817 or info@AdamsStirling.com.

Destroying Board Packets

QUESTION: What should be done with old board packages? (1-5 years old) (5-15 years old?)

ANSWER: There is no policy for destroying board packets. It’s what’s in the packets that matters. Each document in the packet should be compared against your “Records Retention Policy” to see how long to keep it. If each of the documents is separately saved, then the board packet as a whole can be disposed of at any time.

RECOMMENDATION. When you dispose of records, make sure they are shredded, not just thrown into a dumpster. Otherwise, depending on what is contained in the documents, you risk identity theft, invasion of member privacy, and loss of attorney-client privilege.

RE-MAILING
THE BUDGET PACKAGE

QUESTION: We invariably receive budget packages and other disclosure information back in the mail due to member address changes. Are we obligated to resend this information to the new addresses, or are they considered “delivered” per the Mailbox Rule?

ANSWER: Under the “mailbox rule,” when a letter “properly directed is proved to have been either put into the post-office or delivered to the postman, it is presumed . . . that it reached its destination at the regular time, and was received by the person to whom it was addressed.” (Rosenthal v. Walker, 111 U.S. 185, 193 (1884); Civ. Code §4050(b).)

Negligence. In your case, the presumption is lost because you know the annual budget report was not received–it was returned to you. The reason for the failed mailing was the owner’s negligence in not keeping you informed of his/her address change. Members who fail to keep their contact information updated still have a right to the budget report but you can charge them for the additional cost of re-mailing it.

RECOMMENDATION: If you have the budget package in digital form and the owner authorizes it, you can email it. That avoids any disputes over extra mailing costs.

ETHICS ISSUE


QUESTION: Can the HOA hire the spouse of a board member to do maintenance on the association’s property as long as that board member is not involved in any discussions, decisions or votes regarding the hiring or compensation?

ANSWER: Yes.

RISKY BUSINESS


I will be speaking in Sacramento on “The Top Reasons Associations Get Sued.” The seminar is open to board members (and homeowners who plan to become board members). The program will cover:

  • Top 10 reasons associations get sued
  • Strategies to avoid lawsuits
  • How to reduce legal expense
  • New laws you need to know
  • Q&A to follow the presentation

The seminar is free and is this Wednesday, January 20 at the Hilton Arden West, 2200 Harvard St., Sacramento. Doors open at 5:00 p.m. for registration and finger foods. The seminar is 5:30 to 7:30 p.m. and includes door prizes.

The program is hosted by one of the fastest growing management companies in Northern California–Association Management Concepts.

Seating is limited, so make sure you RSVP at (916) 565-8080 x324 or dawyne@assocmc.com.

FEEDBACK

Kudos #1.  Just want to say “thanks” to you and your staff for assisting the many board volunteers throughout California, including myself. I have served as secretary for nine years for a small HOA and now as president for a 108-unit condominium complex in Mammoth Lakes. Over the years, your valuable newsletters and website have helped me immensely in understanding and applying HOA law. There is no doubt that your expertise and commitment in allowing people easy access to solid advice, laws and codes has certainly improved the management and overall quality of thousands of associations, not to mention better risk management! -Mike R.

Kudos #2. I always enjoy your Davis-Stirling Newsletter, not only for information but for the delicious sense of humor. Whomever creates your artwork is a genius. The milk carton “Missing Board Secretary” and broken lead pencil on today’s newsletter are worth a good chuckle. Keep up the good work. You are appreciated and enjoyed. -Kathryn C.

*****

Minutes #1. Regarding your information relative to keeping minutes of meetings; the question that was presented was about an executive session board meeting. I, as a previous board president, remember that our lawyer requested that our board not take any minutes of our executive sessions other than unspecific topics of discussions/decisions. Was this an inappropriate opinion? -Tom S.

RESPONSE: I respectfully disagree. Executive session minutes should reflect the actions of the board as well as justifications for those actions. If you’re acting on advice of counsel, you can say that in the minutes. Executive minutes are not subject to membership review. If, for some reason, litigation erupts and minutes are subpoenaed, the information in the minutes can be important for showing the board was acting in good faith and in the best interests of the association (Business Judgment Rule). Any attorney-client privileged information can be redacted.


 
Adrian Adams, Esq.
ADAMS | STIRLING
A Professional Law Corporation

We’re friendly lawyers–boards and managers can reach us at (800) 464-2817 or info@AdamsStirling.com.

When the Secretary is Missing

QUESTION: I am secretary for our HOA. An executive session was held at a time when I could not attend and the president is telling me that as secretary it is my job to write a report on what took place at that meeting. I told him that he should do it, as I was not there and cannot report on what I did not witness.

ANSWER: The proper procedure when the secretary is not present at a meeting is for the president to appoint someone to take the minutes so there is a record of the board’s actions. (Robert’s Rules, 11th ed., p. 459.)

From Notes. If no one took notes, you can’t be expected to create minutes out of thin air. Someone who was at the meeting (the president or one of the other directors) needs to sit down and put to paper (or an email) who attended the meeting and what business was conducted. Then you can put that information into proper format as minutes.

Board Approval. Once the board reviews and approves the minutes, you can sign them. Remember, your signature does not mean you attended the meeting or approve the decisions made by the board. Your signature only means the board approved the minutes. To make that clear, you can include the following with your signature:

These minutes were approved by the Board of Directors.

      <signature>                       
Jane Smith, Secretary

RECOMMENDATION: For more information, see “Sample Minutes.”

UNWRITTEN
MINUTES


QUESTION: If minutes from a meeting are never written, is that interpreted as the meeting never having taken place and thus all decisions made during that meeting are null and void? Also, what if minutes are never written until 65 days after the meeting and they are done by the president (who was conducting the meeting and thus not really able to take accurate notes)?

ANSWER: The meeting still occurred even if there is no written record of it. Written minutes are important because they serve as prima facie evidence of what occurred at the meeting. (Corp. Code §7215.) Without a written record, what took place can still be determined through testimony. The problem is that memories fade and disagreements may occur over what was approved and not approved.

Minutes Are Required. Boards are required by statute to keep minutes of their meetings. (Corp. Code §8320.) In addition, draft minutes must be made available for member review within 30 calendar days of the meeting. (Civ. Code §4950.)

RECOMMENDATION: If boards must create minutes from memory at a later date, they should do so. Once approved by the board, they become the agreed-upon record of the meeting, even if they are not entirely accurate. See “Approving Old Minutes.”

NEW ADAMS STIRLING
PARTNERS


I am pleased to announce three new partners: Aide Ontiveros, Cang Le, and Jasmine Fisher.

Aide, Cang and Jasmine epitomize the professionalism, legal expertise, and devotion to client service our clients have come to expect from ADAMS | STIRLING PLC.

Aide Ontiveros oversees the firm’s litigation department across all offices statewide. An exceptional litigator for over 20 years, Ms. Ontiveros has appeared in state and federal courts, and has taken cases successfully through the appellate level. Ms. Ontiveros also provides counsel on ethics issues and works with clients to develop effective litigation plans and focuses on litigation avoidance as much as possible. Ms. Ontiveros earned her law degree from the University of California Los Angeles School of Law.

Cang Le manages the firm’s Inland Empire office. His practice includes both transactional and litigation services and he works with all manners of common interest developments including planned unit developments, golf and lake associations, and senior communities, among others. Mr. Le is a well-recognized expert in this field and frequent speaker and author at events statewide. Mr. Le earned his law degree from the University of San Diego School of Law and an LLM (Master of Law) in taxation from there as well.

Jasmine Fisher Hale heads the firm’s Los Angeles transactional practice group and oversees all Northern California clients. Her practice includes representation of large master-planned communities, mixed-use projects, and high-rise developments, among others. Ms. Hale not only specializes in all manners of general counsel, she also has an extensive practice in employment law to assist clients. Ms. Hale earned her law degree from Pepperdine University School of Law and has a certification in entrepreneurship.

For more information about our legal services call (800) 464-2817 or email us at info@AdamsStirling.com.

FEEDBACK

Counting Days #1. I always enjoy your newsletters. In reference to the days for notification, I noticed Thanksgiving Day was omitted as it is the 4th Thursday in November. -Ruth H.

RESPONSE: I have no explanation for California’s exclusion of Thanksgiving. Legislators did, however, throw in a catch-all at the end for “Every day appointed by the President or Governor for a public fast, thanksgiving, or holiday.” Since Thanksgiving became a national holiday by an act of Congress in 1941 rather than being appointed by the President, it does not qualify under California’s catchall provision. Maybe Governor Brown will declare an annual public fast for the 4th Thursday of November, thereby making Thanksgiving a holiday. That means you can cook a turkey, you just can’t eat it.

Counting Days #2. I think I’m correct in my counting! At long last! -Sharon O.

Counting Days #3. We here at Miraleste Canyon Estates have reversed the 10 and 15 day notices, we mail the notice of violation hearing on the 15th day and the result of hearing by the 10th day. It is an easy way to remember the 10 and 15 day rules. -Virgil M.

*****


Year-End Bonus #1. Since the bonus question is raising so many issues, I am the president of a HOA. We include in our budget and give cash gifts (“bonuses”) for the guards at our gatehouse. Is there anything wrong with that? -Eve W.

RESPONSE: There is nothing wrong with it. As I pointed out in last week’s newsletter, if the amount of the cash gifts are more than nominal, you should run them through payroll so appropriate employee withholdings and taxes are taken out.

Year-End Bonus #2. Residents in our association contribute to a holiday fund, which is for onsite staff. The fund is then distributed by the board using a formula to determine the proportion that is given to each staff member. Employees of the management company though must have the distributed gift go through as regular payroll, subject to all withholdings as they treat the gifts as remuneration…not a “tax free” gift. Let no good deed go untaxed. -Bill L.

Year-End Bonus #3. [Your readers’] snarky criticisms of the L.A. Times’ column “Associations” indicates the mentality of the critics. You may not agree with any or all of the “Associations” topics, but the mere fact that those subjects are covered provides insights into Davis-Stirling that would otherwise not get an airing. Although I’m computer literate many seniors still enjoy a newspaper over a cup of coffee. So ease off folks and consider our constitution’s provisions for expressing opinions that may even be disagreeable. -Eric D.

RESPONSE: I suspect readers are critical of the L.A. Times’ “Associations” column because of its inaccuracy when it comes to the law. If the Times writer were merely expressing an opinion about the weather, no one would take issue. But when the writer tells readers they are breaking the law and will lose their tax status, putting everyone into a panic, that gets people’s attention. Fortunately, the Times article was wrong and boards CAN give year-end bonuses and doing so will not change an association’s tax status. The Times writer made a mistake–it happens to the best of us. I’m sure the rest of the paper is good over a cup of coffee.

Year-End Bonus #4. As an addendum to the LA Times advice, I believe only one quarter of what I read these days, but that, of course, does not include your answers and analyses! -Angela D.


 
Adrian Adams, Esq.
ADAMS | STIRLING
A Professional Law Corporation

We’re friendly lawyers–boards and managers can reach us at (800) 464-2817 or info@AdamsStirling.com.

Counting the Days

QUESTION: I have a question about the 15 days for hearing results notification. Our manager said it is 15 business days not including holidays and weekends. It that true, or is 15 calendar days?

ANSWER: It’s almost true. The statute you are referring to is Civil Code §5855 which requires 10-days’ notice of a disciplinary hearing and 15-days’ notice of the board’s decision following the hearing.

Confusing Laws. There are a bunch of statutes in the Civil Code and the Code of Civil Procedure on counting days. In standard government fashion, they make it as confusing as possible. The ones that apply to the Davis-Stirling Act are found in the Civil Code.

Calculating Days. How to count days for purposes of giving notice was enacted in 1872 as Civil Code §10. It provides that the time in which any act provided by law is to be done is computed by excluding the first day, and including the last, unless the last day is a holiday, and then it is also excluded.

Sundays. Holidays are defined to include Sundays: “Holidays within the meaning of this code are every Sunday and such other days as are specified or provided for as holidays in the Government Code of the State of California.” (Civ. Code §7.)

Holidays. Government Code §6700 (effective 1-1-16) defines holidays as:

  • Every Sunday
  • January 1st
  • The third Monday in January, known as “Dr. Martin Luther King, Jr. Day”
  • February 12th, known as “Lincoln Day”
  • The third Monday in February
  • March 31st, known as “Cesar Chavez Day”
  • The last Monday in May
  • July 4th
  • The first Monday in September
  • September 9th, known as “Admission Day”
  • The fourth Friday in September, known as “Native American Day”
  • The second Monday in October, known as “Columbus Day”
  • November 11th, known as “Veterans Day”
  • December 25th
  • Good Friday from 12 noon until 3 p.m
  • Every day appointed by the President or Governor for a public fast, thanksgiving, or holiday

Summary. When giving a 10-day notice of a disciplinary hearing, count calendar days, excluding the first day. If the last day of the notice period falls on a Sunday or a holiday, extend the time to the next non-holiday.

RECOMMENDATION: Whenever possible, I like to throw in a cushion so as to avoid any problems. Instead of giving a 10-day notice of a disciplinary hearing, give two weeks’ notice. Instead of waiting until the 15th day to send the board’s decision, send it within ten or twelve days. That way no one can claim insufficient notice was given.

Thank you to attorney Wayne D. Louvier for researching this issue. Wayne is a senior attorney who works out of our Orange County office.

FEEDBACK


Two weeks ago, I wrote about erroneous advice given by the L.A. Times that boards could not give employees year-end bonuses. I received more responses than I can print. Following is a sampling:

Employee Bonus #1. I rarely give the LA Times [condo] column a glance but this one caught my eye. I can’t understand why the Sunday Times would permit a person who has so little understanding of the industry to babble on each week. I must remind myself to ignore all this drivel as it is not good for my blood pressure! -Diana S.

Employee Bonus #2. LA Times HOA article a “train wreck”………………. Wow, that only happens 50, maybe 51, weeks a year. -Scott C.

Employee Bonus #3. Associations sometimes write a check for the bonus they want to give and charge it to a “bonus” general ledger account. Except for minor gifts like a bottle of wine, these bonuses are compensation and need to be run through the payroll system. If you want to give an employee a $1,000 bonus, you can write a net check for that amount. But, you must “gross” it up in the payroll system to cover all the normal employer taxes, workers compensation, required withholdings, etc. To pay a net $1,000 bonus it will cost the association somewhere between $1,100 and $1,400 depending upon their tax facts. -Donald W. Haney, CPA, MBA, MS(Tax)

Employee Bonus #4. I contacted the writer of the L.A. Times article and she said that IF the employees work for the association’s management company and NOT directly for the association then she believes there is a violation. She said that those employees would be no different than being a vendor and she feels giving bonuses to vendors is a violation. Perhaps you could consider this and let us know if you still disagree or perhaps agree with her. Again, are any employees of the management company considered to be the association’s employees or a vendor’s employees????? -Fred B.

RESPONSE: I continue to disagree with the L.A. Times writer. For convenience, employees of associations are sometimes put on the payroll of the management company. Doing so does not preclude the board from giving year-end bonuses. However, they should be run through the vendor’s payroll account so they can take out appropriate taxes and withholdings. I contacted CPA and HOA specialist Don Haney for his comments on vendor bonuses and received the following:

Giving a bonus to a vendor is not illegal, immoral or fattening. Suppose a management company’s employees are onsite to the association. The management company is acting as the employer of record. But, I think you will find that in most cases the law considers the association as a “co-employer” in these situations. If the association wants to give bonuses to those employees as part of its deal with the management company, then the management company bills the association for the gross cost of doing so, includes the gross cost in its payroll, and distributes the net to its employees. No harm. No foul. The act does not jeopardize the association’s tax status. -Donald W. Haney, CPA, MBA, MS(Tax)

Employee Bonus #5. Residents in our condo building arrange holiday bonuses for employees by having a volunteer group (none of whom is a director) solicit voluntary contributions and then use a formula to determine the proportion of the total that is given to each employee. One reason we created this procedure is to keep the gifts tax-free to the employees, as they are not compensation and not from the HOA. -David C.

Employee Bonus #6. I greatly enjoy your informative articles. So, a newspaper article was a “train wreck?” As Mark Twain said, “If you do not read a newspaper, you are uninformed. If you do read a newspaper, you are misinformed.” -Richard P.

Employee Bonus #7. As always I enjoyed your sometimes hysterical but informative newsletters. Thank you!!!! -Gloria F.

Employee Bonus #8. Your newsletter is a hoot. I look forward to it every Sunday. -Norm S.

Employee Bonus #9. Often on the opposite sides of the political fence, I enjoy your emails immensely. Mostly because they just make sense, and can recognize the difference as my one boss used to say, between pepper and fly shit (as my mother used to say, please excuse my French.) Happy everything, -Chris C. California (where you need to be either very poor or very rich to live.)

*****

The following comment is on my article about a badly drafted statute requiring condominium associations disclose whether they are FHA and VA certified.

FHA Disclosure. The statute was poorly drafted–and I always thought that we Californians had the best Assembly that money can buy. I don’t recall voting for any 11-year-olds to go to Sacramento. Oh well, what can you expect from a bunch of lawyers who have no concern for implementation requirements for their silly ideas. -Hank J.

 
Adrian Adams, Esq.
ADAMS | STIRLING
A Professional Law Corporation

“Much More Than Just a Law Firm!” We’re friendly lawyers–boards and managers can reach us at (800) 464-2817 or info@AdamsStirling.com.

Christmas Bonus for Employees

QUESTION: According to an article in last week’s LA Times, boards cannot give year-end bonuses to employees without membership approval. And even then it may affect the association’s tax status. Our HOA has been giving bonuses for years. Are directors in breach of their fiduciary duties? Will we lose our tax status?

ANSWER: I received multiple emails about the LA Times article. I thought people had misread it so I looked it up online. Unfortunately, the Times article is a train wreck.

No Violation. Contrary to dire warnings by the Times writers, boards can give year-end bonuses to employees. Doing so is not a breach of their fiduciary duties and does not affect their tax status.

Christmas. Boards can even call them Christmas bonuses if they want. I know it’s politically incorrect and sends the PC police over a cliff but using the word “Christmas” does not violate the constitution. Christmas happens to be a national holiday.

Personnel Issues. Boards have the authority to hire employees and contract with vendors to provide services to the membership. This power is found in virtually every set of bylaws I’ve ever reviewed. In addition, associations (through their boards) “may exercise the powers granted to a nonprofit mutual benefit corporation” unless the governing documents specifically provide otherwise. (Civ. Code §4805(a).) This gives broad powers to boards to act on behalf of their associations.

Compensation.The authority to hire employees and contract with vendors means boards can pay for those services. An employee’s compensation can include year-end bonuses, either as part of a negotiated compensation package or as a reward to employees for rendering exemplary service to the association. Boards do not need membership approval for this. The Davis-Stirling Act specifically makes personnel and contract issues executive session topics for boards to address to the exclusion of the membership.

Case Law. The board’s authority to use HOA money for more than just repairing common areas came before the courts in Finley v. Superior Court. In that case, a board used HOA funds to fight the conversion of a nearby military base into a commercial airport. Members of the association sued claiming this was a misuse of their funds and exceeded the board’s authority. The court found that political contributions were not illegal and that boards can take actions they believe are in the best interests of the association, even if members disagree.

Benefits the Association. The Business Judgment Rule relieves directors of personal liability if their decisions are in error, provided they are in good faith and in the best interests of the association. In this case, employee bonuses benefit the association. It establishes good will with employees, promotes stability in the workforce, and encourages good work. Disaffected employees and high turnover are clearly not in the association’s interest—they can be far more costly to an association than a year-end bonus.

Tax Status. Giving a bonus to employees will not result in tax penalties or the loss of an association’s status as a nonprofit mutual benefit corporation. If boards have any concerns on this point, they should contact their association’s CPA.

RECOMMENDATION: Boards should not feel guilty about giving their employees a year-end bonus. And, they should seek legal counsel from legitimate sources.

THANK YOU!

I want to thank everyone for their support this past year. You’ve been terrific in your questions and feedback to the Newsletter and I thank you.

Website. Traffic to the website is up significantly from last year. This year you visited Davis-Stirling.com 800,000 times with 3.4 million page-views. In addition, you offered valuable suggestions for improving the website which were incorporated into the newly designed site we launched last month.

Growth. I deeply appreciate your confidence in our work. Thanks to you, we added over 100 new clients to the firm and expanded our Inland Empire and Orange County offices. In addition, Senator Stirling formally joined as a partner and we changed our name to ADAMS | STIRLING PLC. As Frank Sinatra crooned, it’s been a very good year.

Best Wishes. May you and your families enjoy the holidays and have a New Year filled with peace, prosperity and happiness. From all of us at Adams Stirling, Merry Christmas and Happy New Year. See you in 2016!

OUR TEAM: Larry Stirling, Adrian Adams, Richard Witkin, Bill Dunlevy, Paul Ablon, Aide Ontiveros, Jasmine Hale, Wayne Louvier, Cang Le, Karen Jacobs, Jane Blasingham, Patrick Nichols, Matthew Ames, Nathalie Weinstein, Laura Whipple, Carolyn Houtz, Maureen Davidson, Sue Anderson, Marianne Pick, and Alejandra Alvarez.

FEEDBACK


I had far more responses regarding the 11-year-old director than I could publish. Following is a sampling:

11-Year-Old Director #1. Adrian, you’re a kick! This one had me laughing all through it. I do have one thought…if we modify our bylaws to set an age limit, can we also include a “maturity level”? I suspect there are 11-year-olds with more maturity than some board members I’ve had to deal with. (Best not tell anyone I said that… but, it is amazing what we have to deal with these days.) -Anonymous

RESPONSE: You’re right, there are a lot of people over 18 who still need parental oversight. Unfortunately, many of them are in positions of authority, and not just in associations.

11-Year-Old Director #2. I thought board members had to be owners? Can an 11-year old own property? -Bill D.

RESPONSE. Minors can own property and not all associations require their directors to be members. So both situations present risk. The problem with a minor on title is that they owe no legal duties and they can disaffirm the deed. (Sparks v. Sparks (1950) 101 Cal.App.2d 129.) By setting a minimum age as a director qualification, associations can avoid potential problems with underage directors. I recommend boards amend their bylaws in 2016 to add director qualifications.

11-Year-Old Director #3. You recommended setting the minimum age for directors at 21. Since the legal age of an adult is 18, wouldn’t that result in a discrimination lawsuit? -Kay N.

RESPONSE: Since we live in California, looking at someone sideways can get you sued (or shot). As for discrimination, organizations are allowed to set reasonable qualifications for their leaders. As I noted in my article, many states set 21 and 25 as minimum ages for their representatives. The U.S. uses 35 as the minimum age for President. None have been sued for age discrimination. In my article I recommended 21 as a minimum age. After receiving a long passionate email from a reader about how unreasonable I was, I’ve reconsidered and now think 31 might be a better minimum age.

11-Year-Old Director #4. No court would think that a five-member board of 11-year-olds has any legality whatsoever. So just one 11 year-old on the board is enough of an absurdity, let alone the idea that parents are sending their children into combat zones instead of doing the work themselves. -Kevin H.

*****


FHA/VA Disclosure. If the FHA/VA disclosures apply to condominium developments, are planned unit developments exempt? -Chris A.

RESPONSE: The disclosure is not supposed to apply to planned unit developments. However, the language in the disclosure itself raises questions since it requires an association to disclose whether it is or is not a condominium development. The statute was poorly drafted.


Adrian J. Adams, Esq.
ADAMS | STIRLING
A Professional Law Corporation

“Much More Than Just a Law Firm!” We’re friendly lawyers–boards and managers can reach us at (800) 464-2817 or info@AdamsStirling.com.

11-Year Old Board Member

An attorney in Virginia recently raised an issue about an eleven-year old girl who submitted an application to run for an open seat on the board of directors of a large association.

Concerns. The attorney was concerned that, as a minor, (i) could she approve or execute contracts, (ii) would the board’s D&O insurance cover a minor, and (iii) would the same duties of loyalty and care apply to a minor’s decisions?

No Restrictions. In California there are no age restrictions for serving on a board of directors. The Davis-Stirling Act and the Corporations Code are silent on the issue. That means an 11-year old could be elected to an HOA board unless the governing documents stated otherwise.

Contract Issues. The problem with minors on HOA boards is their right to disaffirm contracts they enter into. (Civ. Code §6710.) Even though the association is the party entering into a contract, if a minor on the board were the deciding vote approving a contract, could she later disaffirm the contract? This is uncharted territory that could result in litigation if that were to occur.

Fiduciary Duties. Upon their election to the board, directors are held to a higher standard. Would that standard apply to an 11-year-old? If criminal courts don’t treat minors the same as adults, it’s unlikely civil courts would either. Even though the minor would not be liable for her actions, the association would. How does that affect insurance coverage?

RECOMMENDATION: Because of legal uncertainties created by a minor on the board, associations should set a minimum age as a director qualification. It can be done via a rule change to the Election Rules or by amending the bylaws. In California, members of the Legislature must be over 18 years of age. Most other states use 21 for their lower house and 25 for the upper house.

Associations can set a minimum age at whatever they think is appropriate. Personally, I prefer 21. But then, I don’t think kids should drink, watch TV, vote, or get married until they’re 21–especially if they still live at home.

Thank you to attorney Wayne Louvier for researching this issue.

NEW DISCLOSURE IN
ANNUAL BUDGET REPORT


Beginning July 1, 2016, boards must add a new disclosure to their Annual Budget Report.

Typewriters. Before addressing the new disclosure, I need to describe the picture on the right for my younger readers. It’s a typewriter ribbon. That’s how documents were prepared prior to computers. A device called a typewriter had a keyboard that caused individual letters to strike a ribbon that transferred ink to a piece of paper. It had a distinct advantage over today’s computers. Since it didn’t use electricity, it worked in a power-failure. All you had to do was light a candle and keep working. I still have one buried in a closet somewhere.

FHA/VA Disclosures. Thanks to our ever vigilant legislature, condominium associations now have two more disclosures to protect all those people who never read them. Beginning July 1, 2016, associations must disclose their status as a Federal Housing Administration (FHA) approved and a Department of Veterans Affairs (VA) approved condominium project.

Disclosure Language. The disclosure must be in the “Annual Budget Report” sent to all owners. It must be in at least 10-point font on a separate piece of paper and in the following form:

Certification by the Federal Housing Administration may provide benefits to members of an association, including an improvement in an owner’s ability to refinance a mortgage or obtain secondary financing and an increase in the pool of potential buyers of the separate interest.

This common interest development [is/is not (circle one)] a condominium project. The association of this common interest development [is/is not (circle one)] certified by the Federal Housing Administration.

VA Disclosure. The same disclosure must be made about VA certification. It’s incredibly silly but the VA disclosure cannot be made on the same piece of paper as the FHA disclosure. It must be on its own piece of paper. Trees protested but the Legislature turned a deaf ear.

Condo Developments. There is another piece of silliness–the new law applies to condominium developments but then requires the association to indicate whether it “is/is not (circle one)” a condominium development. I suspect the bill was drafted by an 11-year-old Legislator. To read the bill, see Assembly Bill 596.

RECOMMENDATION: So as to avoid creating potential liability for themselves, associations should add two more sentences to each disclosure. The first should state that information regarding the association’s FHA/VA status is as of a particular date. That way if the association’s status were to change after the disclosure was made, a buyer and seller in escrow can’t claim they were misled. The second sentence should direct people to check the FHA website and VA website for current information.

ABCs of HOAs


I will join a panel of experts to cover new laws affecting associations, insurance issues, deferred maintenance/budgeting, collections and management issues.

This is a free event for board members with a catered lunch and raffle prizes (including an iPad). The program will be held Saturday December 12, 2015 from 11:00 a.m. to 3:30 p.m. at the beautiful Olympic Collection, 11301 Olympic Blvd #204, Los Angeles 90064.

Please RSVP kristal@hoaorganizers.com or fax (818) 286-9434 or phone (818) 778-3331 (Kristal).

FEEDBACK

Mobile App. Congratulations on the new Davis-Stirling website. It is an impressive update–clean and fresh looking. You said you deactivated the mobile app. I really used that a lot. Can you write a new one? -J.B.

RESPONSE: A new mobile app is on my to-do list. I have other website upgrades in motion but should get to the app by the first of the year.

Empty Chair #1. Am I the only person that does not know about Clint Eastwood and the empty chair? -L.S.

RESPONSE: Clint Eastwood was a keynote speaker at the Republican National Convention when Mitt Romney was nominated to run against Barack Obama in 2012. Eastwood’s speech was off the cuff and dealt with the President being missing in action when it came to leadership. He used an empty chair as a prop. It made for interesting theater and created a big stir in the media. The electorate did not agree with Mr. Eastwood and reelected the President. I sometimes forget that not everyone follows the news.

Pepper Spray. I have another good use for a metal whistle: getting rid of pesky telemarketers. Trust me, it works. As far as the pepper spray is concerned, if the board does not establish a “use of force” policy and train board members to deploy pepper spray, they’re just asking for a law suit. Any such policy should be discussed with the association’s attorney to make sure they are on solid legal ground. -John A.


Adrian Adams, Esq.
ADAMS | STIRLING
A Professional Law Corporation

“Much More Than Just a Law Firm!” We’re friendly lawyers–boards and managers can reach us at (800) 464-2817 or info@AdamsStirling.com.

Filling an Empty Seat

QUESTION. If a board member resigns one full year before the end of her term, is her empty seat automatically open for election or does the board appoint her replacement?

RESPONSE: I know Clint Eastwood had trouble filling an empty chair three years ago but it’s fairly routine for boards of directors. The mechanism depends on two things: (i) how the vacancy was created and (ii) the language in your governing documents.

Recall. Vacancies caused by the membership’s removal of a director (a recall) cannot be filled by the board. It must be filled by the membership at a special election (Corp. Code §7224(a)). That should be done on the same ballot as the recall.

Death & Resignation. Vacancies created by death or resignation of a director are filled by approval of a majority of the remaining directors, unless the governing documents expressly provide otherwise. (Corp. Code §7224(a), Robert’s Rules, 11th ed., p. 467.) Most bylaws follow the Corporations Code and give the board the authority to fill the seat.

Failure to Appoint. If the board fails or refuses to fill an empty position, the membership can call for a special election. (Corp. Code §7224(b).) The process is initiated by filing a petition with the board for a special meeting to fill the seat.

RECOMMENDATION: Check your articles of incorporation and bylaws to see if they address the subject. If they are silent, then follow the Corporations Code as described above.

SPECIAL ASSESSMENT
APPROVAL REQUIREMENT


QUESTION
: Concerning special assessments, our CC&Rs state we need a majority of the total voting power of the association to pass an assessment. Yet, Davis-Stirling clearly states that assessments pass with a majority of a quorum. Does the statute trump our CC&Rs?

RESPONSE: Whenever there is a conflict between the law and governing documents, the law controls unless it specifically defers to the governing documents. See “Hierarchy of Documents” and “Rules of Interpretation.” In this case, the Davis-Stirling Act controls. That means a majority of a quorum of the membership can pass a special assessment.

NEW DAVIS-STIRLING
WEBSITE


I am pleased to announce that on Monday we launched a new and improved version of the award-winning Davis-Stirling.com website.

Mobile Friendly. The new website will work on any device with a web browser–from desktops to tablets to smartphones. Because it’s designed to mold to the screen size of any portable device, the website is fully responsive, mobile- and tablet-friendly. As a result, the old mobile app I created (the first in our industry) has been deactivated. We may design a new one with other features at a later date and will let everyone know when that happens.

More Features. The new programming also gives us the ability to build more features into the website. Those are now under development and will be announced as they are completed.

THIRD ANNUAL
ABCs of HOAs


I will join a panel of experts in a program hosted by HOA Organizers. The event is for board members and will cover new laws affecting associations.

In addition, we will cover insurance issues, collections and foreclosures, management procedures and responsibilities, and deferred maintenance/budgeting. There will be time for Q&A with each session.

This is a free event with a catered lunch and raffle prizes (including an iPad). The program will be held Saturday December 12, 2014 from 11:00 a.m. to 3:30 p.m. at the beautiful Olympic Collection, 11301 Olympic Blvd #204, Los Angeles 90064.

Please RSVP kristal@hoaorganizers.com or fax (818) 286-9434 or phone (818) 778-3331 (Kristal).

FEEDBACK


Pepper Spray #1
. Nice people may feel reluctant to use pepper spray when they aren’t sure if they are actually in jeopardy. And, at the moment they need to use it, they may fumble it out of lack of experience and nerves. A good thing to have on hand in such a situation is a good, loud whistle, like a metal referee’s whistle. These are readily available on the internet and in sporting goods stores and everyone knows how to blow a whistle. No fear of hurting an innocent person with it, either. -Susan K.

Pepper Spray #2. Employees should use wasp/hornet spray. It is not expelled as a spray but as a strong stream, as far as 20 to 25 feet away, preventing a potential threat from getting close to them. With pepper spray, you run the risk of affecting others from the spray, especially in any breeze. The wasp/hornet spray shoots a very strong stream and is more highly effective than pepper spray. This requires no certification, no legal mumble jumble, no questionable passion restrictions, just an effective anti-threat weapon that is much more effective than pepper spray. -Don C.

RESPONSE: Good grief! Don’t take out a bad guy with a product designed to kill wasps. The lawsuit that followed would be very expensive. That’s like setting bear traps to catch burglars. The burglar would never enter your house again but you might be spending the rest of your life sharing a cell with him in prison. Only use products approved by the state for self-defense. If you want an alternative to pepper spray, Susan K’s whistle works.

Pepper Spray #3. Good newsletter as always. Just wanted to feedback on the pepper spray. I am a deputy with the San Francisco Sheriff’s Department and have spent a great amount of time in court as an expert witness with regard to DNA and ID systems, We also cover use of force a lot in our department. You are dead on about having a policy and best to have an actual “Use of Force” policy. A written policy and staff training gives the association solid footing in any legal action that may follow.  -Joseph L.

RESPONSE: I edited Joseph’s response due to space limitations. He pointed out a number of issues for associations to consider when using pepper spray. If boards want to arm their employees, they should work closely with a security consultant and legal counsel to fashion appropriate policies.


Adrian Adams, Esq.
ADAMS | STIRLING
A Professional Law Corporation

“Much More Than Just a Law Firm!” We’re friendly lawyers–boards and managers can reach us at (800) 464-2817 or info@AdamsStirling.com.

Pepper Spray for Employees

QUESTION: Our association has a large onsite staff. A police officer attended our staff meeting because of recent security incidents affecting our employees. He said we should issue pepper spray to them for their safety. I am concerned about liability.

ANSWER: While it’s appropriate to be concerned about liability, it should not outweigh the safety of your employees. If there is a foreseeable risk of harm to your staff and the association does nothing, you could have a bigger liability problem if an employee is attacked and injured.

Proper Product. If you issue pepper spray to employees, make sure you get the right product. Do not get tear gas. Unless you know what to purchase, you should buy from a California store rather than the internet since different states have different laws. A California store will carry the proper type of pepper spray. Also, don’t buy
the key chain size; get something larger.

Proper Training. To protect against potential liability, get your employees certified to use it. Like any weapon, the first step is education and training. You should have a written policy and instruct your employees that pepper spray is only for self-defense, not for apprehending criminals (or subduing unruly board members).

Proper Control. Keep the product locked up when not in use to keep it out of the reach of children and unauthorized adults. You should keep a log where employees check the product in and out with each shift. Otherwise, it may disappear.

RECOMMENDATION: Talk to legal counsel and a security consultant to see if other measures can be taken to protect employees without issuing pepper spray. If you need the product, they can assist with guidelines and proper training.

Thank you to attorney Wayne Louvier for researching this issue.

GUEST SPEAKERS
IN THE MINUTES


QUESTION
: When a non-member is invited to talk to the community about projects or other items of interest, should he/she speak before the meeting is called to order? Since HOA meetings are for members only, shouldn’t the board ask any person who is not a member to leave?

ANSWER: You’re misreading the statute. It does not prohibit non-members from attending meetings. Rather, it confers rights on members to attend. (Civ. Code §4925(a).) Others can attend at the pleasure of the board.

Spouses, Staff & Others. Although boards can prohibit non-members, that is not the industry standard. It would be unusual to prohibit managers, support staff, and legal counsel since they assist boards in carrying out their duties. In addition to managers and staff, most boards allow spouses and renters to attend meetings and speak during open forum.

Agenda. There is nothing wrong with putting guest speakers on the agenda, calling the meeting to order and recording in the minutes that the person spoke on a particular issue. It may be important to show the board’s due diligence. It also helps keep the membership informed. The Secretary should not transcribe the speech in the minutes–only record who spoke and the topic.

RECOMMENDATION: Don’t tie your hands with a strict prohibition on non-members. First, boards need the assistance of staff and others for their meetings. Second, spouses and renters aren’t all bad. Some of them are actually interested in the well-being of the community and can be helpful.

COACHELLA VALLEY
LEGISLATIVE UPDATE


Attorney Laurie Poole (Peters & Freedman) and I will speak at a luncheon hosted by CAI on new laws affecting associations. We will highlight:

  • Artificial turf and clotheslines
  • New VA & FHA disclosures
  • New pool requirements
  • New cases on short-term rentals, hard-surface floor installations, and more

Everyone is invited to the chapter’s largest event of the year. It will be held Friday, November 20, 2015 at 11:30 a.m. at the Palm Valley Country Club, 39205 Palm Valley Drive, Palm Desert, CA 92211. Please RSVP online or call 760-341-0559.

HIRING ATTORNEYS


Our Inland Empire and Los Angeles offices are busy and each needs another lawyer.

I am looking for attorneys with 2-5 years experience. Litigation experience is a plus.

If you know good candidates, please contact me by email or by phone at 800-464-2817.

FEEDBACK

Going Paperless #1. Do you think clients have something to say about their management companies going paperless? -Richard L.

RESPONSE: As I noted in the article. “[L]et your clients know in case they object. If they object, you can ship the paper minutes to them for safekeeping.” You have another option. If your a board is unhappy with their management company going paperless, you can always hire one that keeps records in a closet off the bathroom. I understand some government officials utilize similar data storage arrangements.

Going Paperless #2. What about paperless information dissemination? We have a website where we store all pertinent HOA documents including past board and committee minutes and agendas. If we switch to electronic transmission, is that an acceptable method of information delivery? -Sheila C.

RESPONSE: Sorry, you can’t use electronic notice unless members agree to it. Everyone under 18 already has an electronic device surgically implanted at birth but older folks are a little behind when it comes to such things. Hence, the Davis-Stirling Act requires you to kill trees and send paper via snail mail unless owners agree to electronic notification.

Going Paperless #3. Paperless is great but what about those folks that do not have a computer or access to the web? -A.H.

RESPONSE: Even though the management company is paperless, notices and disclosures are printed and delivered to members in paper form.

Going Paperless #4. You state that all corporate records may be kept in non-paper form. Does this include election materials? What about reserve studies, contracts for services, invoices from vendors, utility bills, etc.? -Hank J.

RESPONSE: Election materials must be held by the Election Inspector for one year to allow for election challenges. (Civ. Code §5125.) Once twelve months have passed, the materials can be transferred to the association for disposal or storage. As for reserve studies, contracts for services, invoices from vendors, utility bills, etc., all can be scanned and stored digitally. NOTE: Paper files should not be thrown in the dumpster–they should be shredded so as to protect confidential information.


Adrian Adams, Esq.
ADAMS | STIRLING
A Professional Law Corporation

“Much More Than Just a Law Firm!” We’re friendly lawyers–boards and managers can reach us at (800) 464-2817 or info@AdamsStirling.com.

Going Paperless

QUESTION: Our company is going paperless. All of our signed meeting minutes are scanned and uploaded to hard drives and then to the association’s website for viewing. Can we get rid of the original signed paper minutes?

ANSWER: Yes you can. First, however, let your clients know in case they object. If they object, you can ship the paper minutes to them for safekeeping.

Electronic Records. The Corporations Code specifically allows all corporate records to be kept in non-paper form.

[M]inutes and other books and records shall be kept…in any other form capable of being converted into clearly legible tangible form… When minutes and other books and records are kept in a form capable of being converted into clearly legible paper form…[they] shall be…accepted…to the same extent as an original paper record. (Corp. Code §8320(b).)

Secure Backup. Because data can be lost from hard drive crashes, stolen computers, fires, etc., which could put you out of business and get you sued, I recommend redundant, multiple location, backup of your digital records so your company can retrieve the latest data in the event of a disaster.

That means your data should be stored in multiple offsite locations. Companies such as Carbonite, IronMountain, and CompuVault will automatically backup your hard drives each night over the internet to at least two secure facilities. The sites should be in different regions or states so if a disaster hits one site (earthquake, flood, fire, etc.), the other site is unaffected. Following is an illustration from a company called “Hybrid Data Storage”:

RECOMMENDATION: I took my law firm paperless five years ago and the benefits are significant. If management companies have not already done so, they should seriously consider entering the 21st Century.

Thank you to attorney Wayne Louvier for researching this issue.

PATRICK NICHOLS
JOINS ADAMS STIRLING


I am pleased to announce that attorney Patrick Nichols joined our firm.

A dynamic litigator, Patrick will be in our litigation department handling architectural disputes, rules enforcement, insurance defense, restraining orders, alternative dispute resolution, and all litigation related matters for our clients.

Experience
. Before joining Adams Stirling, Patrick gained valuable litigation experience in state and federal courts including California’s Court of Appeals where he drafted, argued, and won numerous motions for summary judgment, demurrers, and motions to compel. Patrick conducted and defended countless depositions of percipient and expert witnesses and drafted dispositive motions in personal injury, professional negligence and government liability cases.

Employment Litigation. Patrick also has important employment law experience he gained from a busy employment law boutique where he performed all aspects of case management and client counseling plus writ petitions to the Court of Appeals. Patrick’s strong background in labor and employment law gives him a unique litigation perspective when advising clients on such matters.

Education. Patrick earned his Juris Doctor degree from Pepperdine University School of Law where he competed on a competition trial team that achieved high scores over a dozen other schools. Patrick earned a Bachelor of Arts in Business Administration from Principia College where he was elected student body treasurer and participated in varsity football and rugby. He also studied abroad at the Kyoto Institute of Culture and Language in Kyoto, Japan.

Legal Services. To learn more about our legal services, contact us.

FEEDBACK


Pythons #1
. Pythons and other constrictors do not actually “crush” their prey (though the end result is much the same). Rather, they wrap their body around their potential dinner and when it exhales they take up the slack and tighten their grip. When the prey can no longer inhale, it becomes bereft of life. -Jerry F.

RESPONSE: That is comforting to know. If I ever find myself in that situation, I will keep it in mind.

Python #2. I read with great interest your comments on prohibiting pythons as pets. But what about prohibiting pythons as homeowners? -Ronald J.

RESPONSE: The slithering kind are easy to deal with, just call Animal Control. The two-legged kind cost HOAs a lot of aggravation and money, Animal Control won’t touch them, and they squeeze the life out of board members and managers alike.

*****

NOTE: There were too many clothesline responses to print and some had to be edited for space limitations.

Clotheslines #1. People are walking around in public displaying their underwear, thongs, bras, and even the body parts these items were once intended to cover; so, I don’t understand why letter writers find underwear drying on a clothesline offensive. Just sayin’. -Stephany Y.

Clotheslines #2. “I’m sure that’s what the legislature had in mind.” Objection: Assumes facts not in evidence. What minds? -Joe S.

Clotheslines #3. I believe the feedback over clothesline is funny, how many people do you really think are going to use clothesline in the big picture? I say very few, and so what if they do? I grew up with clothesline and never gave them a second thought. It seems people are just so uptight about everything these days. Be glad we live in America and I hope no one gets too offended by the sight of a families laundry hanging on the line saving energy. My guess is 99.9% of American’s are too lazy to use them. -Ron R.

Clotheslines #4. I am thankful that the governor signed the bill. Our condo just passed a rule saying that we could use drying racks as long as it was in a discreet location and underwear was not visible. They actually use the word “underwear.” -Thomas C.

Clotheslines #5. Always enjoy your newsletter. Why don’t people get more involved in politics so these stupid laws don’t get passed in the first place? The people passing these laws hear one person and JUMP to act. They don’t look beyond the end of their nose to see what it will do to others. -Theresa S.


Adrian Adams, Esq.
ADAMS | STIRLING
A Professional Law Corporation

“Much More Than Just a Law Firm!” We’re friendly lawyers–boards and managers can reach us at (800) 464-2817 or info@AdamsStirling.com.

Pythons as Pets

QUESTION: If our CC&Rs don’t restrict it, can an owner have a python as a pet? A member found a python that got loose in their garage and the owner still has another one in his unit.

ANSWER: Yes, pythons can be restricted, even if your CC&Rs are silent on the issue.

Domesticated Animals. Normally, CC&Rs have language limiting pets to usual domesticated cats, dogs, fish and birds. A python is neither usual nor domesticated. Most people consider them quite scary. If you were rummaging around in your garage, which would you rather be surprised by–a puppy or a 10-foot snake? As a “pet” you can’t pet them like a kitten, you can’t let them slither around the property unattended, and if you value your life you can never sleep with them. Feeding them is not for the squeamish, not to mention the terrified mice.

Can Be Deadly. Pythons can grow to 23 feet and weigh up 250 pounds. Even though they are not venomous, they can deliver a nasty bite. They are generally docile, until they’re not. A large python can easily kill a person. Last month, one nearly crushed to death a pet store owner before police were able to pry it off him. It was wrapped around his head, neck, and torso. In 2013, two young brothers were strangled in their sleep by a python. In 2009, a python crushed the life out of a two-year-old girl while she slept in her crib. When a python is hungry, people and pets are not safe. Pythons cannot be trained as service animals and if someone claims it’s a “therapy” animal, the person truly needs therapy.

RECOMMENDATION: Owners can give their snakes cute names (Monty comes to mind) but they remain creepy and deadly and associations can ban them if they so choose. A prohibition can be done by amending CC&Rs or by a simple rule change.

FEEDBACK


Last week’s newsletter dealt with preserving the confidentiality of delinquent owners by using the Assessor’s Parcel Number (“APN”) in board minutes to conceal their identity.

Delinquencies #1. Our assessor’s office has a website in which property addresses can be located using the parcel number. Does this destroy confidentiality? -Norma G.

RESPONSE: Using an APN is nothing more than a fig leaf but it’s the level of confidentiality sufficient to satisfy the state. By statute, “The board shall maintain the confidentiality of the owner or owners of the separate interest by identifying the matter in the minutes by the parcel number of the property, rather than the name of the owner or owners.” (Civ. Code §5705(c).) I don’t know why the legislature bothered since the President listens to our telephone conversations and activists leak everything to the internet.

Delinquencies #2. Our HOA assigns an account number to each homeowner and uses this number for liens. If a parcel number is used, homeowners can call assessor’s office to get the owner’s name. This number is also used in the minutes. This avoids any embarrassment to the homeowners and remains confidential. -Chris S.

RESPONSE: I like your common sense approach. It technically violates the statute but I doubt anyone would object–not even a judge.

Delinquencies #3. To clarify, in open session the board states that parcel “x” is delinquent by $500 and parcel “y” is delinquent by $2000 and votes to place a lien on both properties. Then, records it in minutes that members can view. In executive session, the board votes to foreclose on parcel “z” which is delinquent by $10,000. Are you saying the minutes available to members should state that in executive session, the board voted to foreclose on parcel “z” whose delinquency was $10,000? -Paul C.

RESPONSE: Yes. Just to be clear, when it comes to foreclosures, the board votes in executive session and records full and complete information using the person’s name and address in executive session minutes, which are NOT available for members to view. The board must ALSO include an abbreviated version using APN numbers in the next open session minutes, which members are allowed to view. (Civ. Code §5705(c).)

*****

Clotheslines #1. Great newsletter as always! Just wondering though, what does the “ongoing drought” mentioned in Clothesline #5 question have to do with drying clothes on clotheslines? Are people hoping the water will drip off and irrigate the landscape? -Jan B.

RESPONSE: I’m sure that’s what the legislature had in mind.

Clotheslines #2. Thanks so much for the chuckles. Marijuana leaves on a clothesline is something I hadn’t thought of. And I have met some of those judges with a screw loose. -Patricia G.

Clotheslines #3. I have been a manager for 25 years and I do not understand how this law has passed. The law will bring down property values. The property I manage has two laundry rooms if residents can’t afford $2.50 to do their laundry they can’t afford to live in the community. Why change the law for a few people that complain about the cost. I can’t imagine looking down on a neighbors backyard and seeing a clothes line with their undergarments. Letting residents hang clothes is going to waste more water since our association pays for the water residents use. It appears no one is thinking straight about this subject. -Karen E.

RESPONSE: Speaking of property values, affluent communities with unfenced backyards facing golf courses will be most affected. Members and guests now get to play on expensive courses with breathtaking views of everyone’s underwear. Our tax dollars at work.


Adrian Adams, Esq.
ADAMS | STIRLING
A Professional Law Corporation

“Much More Than Just a Law Firm!” We’re friendly lawyers–boards and managers can reach us at (800) 464-2817 or info@AdamsStirling.com.