By Hanh Pham, Esq., Law Offices of Ann Rankin
Before the Legislature is Senate Bill (SB) 745, an omnibus bill that would implement minor clean-up amendments to the Davis-Stirling Common Interest Development Act (“Davis-Stirling Act”). Though the changes are technical, not substantive, the following may be relevant and important to your Association:
- Delivery of Documents to Association: Civil Code Sections 4035(b)(1) and (2) allow the Association to receive documents by e-mail, if it assented to email delivery, and by personal delivery. Section 4035 is amended to add subsection (b)(3) to allow delivery “[b]y first-class mail, postage prepaid, registered or certified mail, express mail, or overnight delivery by an express service center.” Thus, this provision would authorize the delivery of documents to the Association by mail delivery.
- Quorum in a Duly Held Election: Civil Code Section 4070 is amended to read: “If a provision of this act requires that an action be approved by a majority of a quorum of the members, the Davis-Stirling Action shall be approved or ratified by an affirmative vote of a majority of the votes represented and voting at a duly held meeting at in a duly held election in which a quorum is present represented, which affirmative votes also constitute a majority of the required quorum.” This amendment applies to any lawfully conducted member election, whether conducted at a meeting, by secret ballot procedures pursuant to Civil Code Sections 5100-5145, or by any other lawful means.
- No Conflict with Governing Documents: Civil Code Section 4205 provides guidance on the relative authority of the law and the most common types of common interest development governing documents. In response to public comments expressing concern that Section 4205’s terminology might be read more strictly than intended, the bill amends Section 4205, as follows:
“4205. (a) To the extent of any inconsistency conflict between the governing documents and the law, the law controls shall prevail.
(b) To the extent of any inconsistency conflict between the articles of incorporation and the declaration, the declaration controls shall prevail.
(c) To the extent of any inconsistency conflict between the bylaws and the articles of incorporation or declaration, the articles of incorporation or declaration control shall prevail.
(d) To the extent of any inconsistency conflict between the operating rules and the bylaws, articles of incorporation, or declaration, the bylaws, articles of incorporation, or declaration control shall prevail.”
Civil Code Section 4350, regarding operating rules, was amended to conform to Section 4205(c)’s terminology, as follows:
“4350. An operating rule is valid and enforceable only if all of the following requirements are satisfied:…(c) The rule is not inconsistent in conflict with governing law and the declaration, articles of incorporation or association, and bylaws of the association.”
Therefore, the provisions governing inconsistencies between the governing documents and the law now apply only if there is a conflict, rather than an inconsistency, between the two.
- Notice of Teleconference Meetings: Civil Code Section 4090 is amended so that the Board’s notice of teleconference meetings must identify a physical location where Association members may attend and requires that at least one director “or a person designated by the Board” be at that location. Thus, if all directors are unavailable, the Board may designate its manager or another member to be present at a physical location to connect the Association members by teleconference to the other Board members.
- Notice of Executive and Emergency Meetings: Civil Code Section 4290 provides guidance on notice requirements for Board meetings. In response to concerns that Section 4290 could require the Board to provide more notice for emergency and executive session meetings if the governing documents impose a longer notice requirement, Section 4290 was amended as follows:
“(3) If the association’s governing documents require a longer period of notice than is required by this section, the association shall comply with the period stated in its governing documents, except for a notice of an emergency meeting or a meeting held solely in executive session when the governing documents do not specifically provide a period of notice for these meetings.”
- Disclosure of Rental Restrictions: Civil Code Section 4528 is amended to add the required notice of rental restrictions (per Section 4525(a)(9)) to the form that lists the documents that an owner in a common interest development who wishes to sell her unit must provide to the buyer. Thus, the Association’s form for billing disclosures must include any rental restrictions.
- Cancellation Fee: Civil Code Section 4530 is amended to prohibit cancellation fees for a document request if work had not yet been performed, or if work that had been performed had been compensated.
In addition, SB 745 makes the following changes:
(1) requires the retrofitting of existing toilets, urinals, shower fixtures, and faucets with water-conserving plumbing fixtures for multifamily residential buildings on or before January 1, 2019, unless an addition, alteration or improvements requiring a building permit triggers earlier retrofitting;
(2) replaces standards under the National Electrical Code with the California Electrical Code for inside telephone wiring; and
(3) incorporates the State Fire Marshall’s requirements for smoke alarms.
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