A homeowners association (“HOA”) is required to hold elections for its board of directors (“Board”) when a seat becomes available. The Davis-Stirling Act specifies that HOA elections must conform to certain rules and procedures. A Board can set qualifications for nominees running for the Board, but there are only a narrow set of reasons why a Board can disqualify a person from serving on the Board. Reasons for disqualification include failure to pay HOA assessments, circumstances where a member of the individual’s household would be serving concurrently on the Board, and, in certain situations, the individual’s past criminal convictions.
Senate Bill 432 currently processing through the California State legislature, if enacted, would add another factor that would disqualify an HOA member from running for the Board: if an individual has served the maximum number of terms or sequential terms permitted by the HOA. An HOA is not required to impose term limits for the Board, but if the HOA has term limits, it can enforce them and disqualify a person from running for an additional term.
Senate Bill 432 would also make other technical changes to HOA election rules, including requirements for inspectors of elections, Board candidate requirements, requiring an HOA to maintain election materials for one year after the election, and noticing requirements.
We will follow Senate Bill 432 as it works its way through the State legislature and provide another update if it is finally passed and enacted.
Authored by Reuben, Junius & Rose, LLP Attorney Jay Drake.
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 & Rose, 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.
