Condominium Law to be Revamped

The Davis-Stirling Common Interest Development Act (the “Act”) has governed the creation and operation of common interest developments (mostly condominiums) since its passage in 1985. Through the years, the Act has been amended and supplemented a number of times. This has contributed to an unwieldy combination of different provisions that were not logically organized. Other provisions are outdated or contradictory. After a four year study, the California Law Revision Commission recommended that the Act be rewritten in a more user friendly format. Assembly Bill 805 (Torres) is intended to accomplish this goal. According to the Assembly Committee on Housing and Community Development, AB 805 would group the provisions of the Act in a more logical order, provide for consistent terminology, restate long and complex sections into simpler and shorter provisions, and standardize certain procedures. After reviewing the draft bill, it is clear that AB 805 greatly improves the organization and readability of the Act. One significant improvement is that particular issues, like use restrictions and annual disclosure requirements, are all grouped in one location. This makes the Act much easier to navigate, especially for the members of homeowners associations.

There are also some substantive changes to the Act, but none that are controversial. The legislation has broad support (there have not been any “no” votes in any legislative committees). Based on the Assembly Committee’s report, some of these changes include:

  • a Board of Directors may amend provisions of the condominium declaration (CC&Rs) that are intended to protect the Declarant during the construction and sales process, without a vote of the members or consent of the Declarant, so long as that phase of construction or sales is completed;
  • confirmation that a non-owner occupant has the same protections as an owner with respect to physical access;
  • addition of some minor exceptions to the provision that requires a 67% vote of the members to grant an owner additional exclusive use common area rights. These include: correction of engineering errors or construction encroachments, granting of an exclusive use that is consistent with the original plan of a phased development approved by the Department of Real Estate, to comply with laws, to accommodate a disability, or to transfer management or maintenance of an area that is not in general use by the membership at large;
  • standardizes delivery requirements for notices, including clarification of use of email and electronic notices; and
  • provides for exemptions for commercial condominiums, including certain elections and assessment requirements.

AB 805 has no known opposition and is expected to pass. If so, it will become operative January 1, 2014. We will keep you updated on this change to condominium laws. If you have any questions, or if you would like a copy of the proposed legislation, please contact Kevin Rose.

The issues discussed in this update are not intended to be legal advice and no attorney-client relationship is established with the recipient. Readers should consult with legal counsel before relying on any of the information contained herein. Reuben & Junius, LLP is a full service real estate law firm. We specialize in land use, development and entitlement law. We also provide a wide range of transactional services, including leasing, acquisitions and sales, formation of limited liability companies and other entities, lending/workout assistance, subdivision and condominium work.

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