Posts for Tag : Election Issue

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GOVERNING DOCUMENTS SUPERSEDE THE NEW AIRBNB LAW 0

By Hanh Pham, Esq., Law Offices of Ann Rankin

Clients ask whether San Francisco’s new Airbnb law (effective February 1, 2015) supersedes their declaration of covenants, conditions and restrictions’ (“CC&Rs”) short-term rental provisions or whether they need to amend the CC&Rs to address Airbnb.  The brief answers to both questions are “No.”

Airbnb is a website for people to rent out lodgings, usually on a daily basis.  The new Airbnb law, San Francisco Administrative Code Chapter 41A legalizes short-term rentals but imposes a number of restrictions, discussed below.  San Francisco’s Planning Department will enforce the new law.

The new law does not change CC&Rs’ current restrictions; it imposes additional restrictions.  Your association should send notices to its homeowners to familiarize them with the new law’s important requirements, including the following:

 

  • The 90 Day Rule. The law limits rentals where the host is not present in the unit to a maximum of 90 days per year. Violators who continue to rent out their apartments beyond 90 days would be subject to a $416-a-day fine for the first offense and $1,000 a day thereafter.
  • Only Primary Residence May be Rented. Permanent residents (those residing in their units for at least 275 days per year) are allowed to rent out their primary residences, but not locations in which they don’t live or second or vacation homes. If you are a new resident, you must have occupied this specific unit for at least 60 consecutive days prior to your application. If you own a multi-unit building, you may only register the specific residential unit in which you reside.
  • Registry and Permits. Hosts must register and obtain a permit from the planning department to engage in short-term renting and pay a $50 fee every two years. Hosts will also need to obtain a city business license. Short-term rentals will be listed and tracked by the city in a registry. This information will not be available to the public unless a public records request is filed.
  • Insurance Requirement. Hosts must be covered by liability insurance with at least $500,000 in coverage. Alternatively, they may offer their units for rent through a hosting service that offers at least this much coverage.
  • Hotel Taxes Must Be Paid. The 14% San Francisco hotel tax must be collected and paid to the city. Airbnb has already started collecting and remitting such taxes for its San Francisco hosts. Your association should also send reminders to homeowners regarding the CC&Rs’ rental restrictions. Typically, CC&Rs prohibit rentals of less than 30 days and require the Owner/landlord to provide certain tenant information to the association. The reminder should also advise homeowners that they will be subject to a fine, suspension of membership privileges, and/or a lawsuit for injunctive relief and attorney’s fees incurred to enforce the rental restrictions in the CC&Rs if they violate these provisions. If you need assistance in preparing reminders to the homeowners or summarizing the Airbnb law to them, please contact our firm.

The information contained in this article is for informational purposes only and does not constitute legal advice. Anyone obtaining information on this site should consult with an attorney. The information herein is generalized and not related to any specific set of facts. Neither this article’s content nor any transmissions between you and our firm through this article are intended to provide legal or other advice or to create an attorney-client relationship. In communicating with us through this article, you should not provide any confidential information to us concerning any potential or actual legal matter you may have. Before providing any such information to us, you must obtain approval to do so from one of our lawyers.

By choosing to communicate with us without such prior approval, you understand and agree that our firm will have no duty to keep confidential any information you provide.

 

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HOAs, if You Give Only ONE Side of an Election Issue the Opportunity to Advocate on Its Behalf, the Court May Overturn Your Election!

By Jeff Cluett, Esq., Law Offices of Ann Rankin

 

         On June 26, 2013, the California Court of Appeal, in Wittenberg v. Beachwalk Homeowners Association, held that homeowners’ association boards are subject to Civil Code Section 1363.03 – and that failure to comply could cause a court to overturn an election!
What is Section 1363.03?Section 1363.03 states, in part:

(a) An association shall adopt rules, in accordance with the procedures prescribed by Article 4 (commencing with Section 1357.100) of Chapter 2, that do all of the following:

(1) Ensure that if any candidate or member advocating a point of view is provided access to association media, newsletters, or Internet Web sites during a campaign, for purposes that are reasonably related to that election, equal access shall be provided to all candidates and members advocating a point of view, including those not endorsed by the board, for purposes that are reasonably related to the election. The association shall not edit or redact any content from these communications, but may include a statement specifying that the candidate or member, and not the association, is responsible for that content.

(2) Ensure access to the common area meeting space, if any exists, during a campaign, at no cost, to all candidates, including those who are not incumbents, and to all members advocating a point of view, including those not endorsed by the board, for purposes reasonably related to the election.

            In Beachwalk, the board held three elections to amend the CC&Rs.  The board sent two letters to association members stating that the amendment was “more flexible and reasonable, while still ‘a workable method of fiscal restraint.’”  They also warned that if it did not pass, the association would become embroiled in expensive litigation.  They urged the members to vote for the amendment.  The Association’s website also encouraged its members to vote for the amendment.  A one-page attachment to the letters stated a “Case for amending the CC & Rs” but failed to include opposing material.  An association newsletter also stated that the proposed amendment was more modern and adaptable and failure to pass it would encourage litigation, concluding:  “Vote YES on the proposed 8th amendment to our CCRS so we can put our money to use on physically improving Beachwalk.”The board refused a request to respond to the newsletter and a request to rent the association’s clubhouse for a meeting for candidates who did not support the amendment.  It also refused the request of another homeowner opposed to the amendments to use a common area for a political rally.  Finally, while the newsletter was posted on a glass-enclosed community bulletin board, nonboard members were not permitted to post materials.  Further, nonboard members were not allowed to post material on the Association’s website.The members passed a modified amendment at a third election.  Members opposed to the amendment sued.  The court of appeal held that the board violated Section 1363.03(a)(2).  Why?First, the court held that the board is subject to Section 1363.03(a)’s equal access provision.  Therefore “[t]he equal-access provision of subdivision (a)(1) is triggered any time a ‘member’ advocates a point of view using association media.”  The California Legislature wanted to ensure that opposing voices were heard.  Therefore a board must either give equal access to opposing viewpoints or forego the use of association media.

Second, by advocating its viewpoint and failing to allow opposing viewpoints, the board violated Section 1363.03(a)(2).  The board advocated for the amendment by letters, attachments to letters, website, newsletter, and bulletin board.  Yet it refused to allow opponents to use media such as the clubhouse and the common area to voice their opposition.  The board therefore violated Section 1363.03.

Oddly, despite these findings, the court did not overturn the third election.  Rather, it returned the case to the trial court to determine whether the violations of 1363.03(a)(2) should be considered in deciding whether to void the third election.

Why should you care?  Because elections are time-consuming, expensive, and contentious!  You do not want your election results overturned.  So what do you do?

First, if the board wants to advocate for the passage or defeat of an amendment, it must allow its opponents access to the same media – common areas, websites, newsletters, etc.

Second, if anyone wants to use association resources to advocate their position, the board must decide whether to let them.  If the board decides not to, then it does not need to allow the other side to do so.  However, if it does allow such access, then the board must allow the other side access as well.  If it does not, then it risks having its election results overturned.

 

This article is general in nature. It is not a substitute for qualified legal advice. Contact an attorney with expertise in common interest development law if you require specific legal advice.