HOA LOANS
 QUESTION: What is the individual unit owner's liability/responsibility when the HOA takes out a bank loan?
ANSWER:
HOA bank loans are secured by a special assessment against the
membership. Individual owners are responsible for their portion of the
assessment. However, their obligation could
expand if other members
become delinquent, are foreclosed upon or declare bankruptcy. When that
happens, the association may have
no choice but to increase the burden on everyone via higher dues or
special assessments to make up the lost revenue.
RECORD DATE
 QUESTION:
We sent out the annual meeting package, including ballots, in a timely
manner. During the time between the mailing and the meeting, a
property was sold. Is the prior owner allowed to vote? What happens
to the secret ballot they returned? Should the new owner get a ballot?
ANSWER:
Normally the owner on record with the association when ballots are mailed has the right to vote. That date is known as
the "record date" for the election. As provided in the Corporations
Code, the record date is set by the board to establish who is a member
as of that date and, therefore, eligible to vote. Corp. Code §7611.
Typically, the record date is set a few days to a week in advance of
the mailing of the ballots. This allows time for preparing election
materials, putting eligible voter labels on ballot envelopes, and
printing a voter list for the Inspector of Elections.
Automatic Record Date. If a date is not selected by the board, then the date ballots are mailed becomes the record
date. Those who become owners after the record date are not eligible to cast
ballots in the pending election (but would be eligible to vote in subsequent elections).
Suspended Voters. It should be noted that members who are eligible as of the record date can still have their voting rights suspended.
NATHALIE ROSS
 I am pleased to announce that Nathalie Ross has joined Adams Kessler PLC as Director of Business Development.
Experience.
Nathalie has been in our industry for 14 years and is a certified
paralegal in both California and Nevada. Prior to joining Adams Kessler,
she was involved in sales and marketing for two of the largest law
firms in Nevada as well as operations of a community management company.
Professional Activities. Nathalie served as the 2010 President of the Nevada Chapter of the Community Associations Institute and is an active member of CAI chapters throughout California.
Duties.
Nathalie will be working with our existing clients as well as new ones
on quality control and follow-up, coordinating proposals and interviews,
client interaction,
as well as industry functions and educational events. If your
association needs a proposal for legal work, please contact Nathalie at nathalie@davis-stirling.com.
RENTAL RESTRICTION
FEEDBACK
I'm sorry I could not print everyone's feedback on rent restrictions--there were too many. Following are a few:
 Insurance Issues. Senate Bill 150
has the potential to affect homeowner association insurance premiums.
Granted we’re not talking about every association since current
restrictions will be grandfathered. Most insurance companies have caps
on rental percentages. The caps are anywhere from 25% to 49% rented. If
rental percentages go beyond these caps and insurance companies do not
adjust their guidelines, HOAs may have to start paying apartment program
rates which are above what condo rates are. -Patrick Lyons, Operations Manager, Socher Insurance Agency.
RESPONSE:
Unfortunately, the California Association of Realtors was not thinking
of the financial health of community associations when it sponsored the
legislation; it was thinking of the financial welfare of its Realtors.
By putting its own special interests ahead of homeowners, CAR took away
the right of owners to shield themselves from higher insurance premiums,
higher administrative costs, rules enforcement problems and lower
property values. The most serious side effect is that many condominium
associations will be denied access to funds needed to refinance and sell
their homes--a shortsighted consequence of CAR's meddling. The bill was
authored and coauthored by:
Senator Lou Correa
State Capitol, Room 5052
Sacramento, CA 94248
(916) 651-4034 |
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Assemblyman Steve Knight
State Capitol
Sacramento, CA 95814
(916) 319-2036 |
Amendment Deadline.
My HOA is currently voting to amend our CC&Rs to add a rental
restriction. None exists now. If it passes and is recorded before
January 1, 2012 how am I affected? -Sharon B.
RESPONSE:
If the amendment is approved by the membership and recorded by December
31, 2011, the restriction will be enforceable against all current
owners as well as all future owners. If the amendment is approved and
recorded after December 31, it will apply to future owners only.
MORE FEEDBACK
 Electric Charging Station #1. So, if Senate Bill 209 has a major flaw, why did the governor sign it? Shouldn't it have been fixed before he signed it? The signing statement
is not law. The legislature may not return to this item for months,
years, or ever; but in the meantime, HOAs are stuck with this horrible
law that will devolve into expensive litigation. A multi-million dollar
building could go up in flames, but the legislature thought a million
dollar policy was sufficient? Who pays for the electricity? Are the
tree-hugging, pot-smoking Prius drivers going to install their own
meters at their own expense? -Stephany Y.
Electric Charging Station #2.
Regarding the major flaw with SB 209, why wasn't this bill amended
before the proposed law was signed? It seems to me that too many
legislators are proposing bills that affect homeowners associations when
they don't have a clue about what the impacts are. -Pat C.
Carbon Monoxide Detector #1. Under SB 183,
are the installation of carbon monoxide detectors in rental units
required forthwith, or only upon the sale of the property thru a
disclosure statement? -Roger L.
RESPONSE: All dwelling units, not just rentals. The detectors must be installed in all single-family homes by no later than July 1, 2011 and in condominiums and townhomes by no later than January 1,
2013.
CO Detector #2. When you wrote "every dwelling unit" did you mean every dwelling unit or just transferred properties? -Flavia B.
RESPONSE:
Every dwelling unit. It should be noted that the State exempted itself
from regulation: “'Dwelling unit intended for human occupancy' does not
mean a property owned or leased by the state, the Regents of the
University of California, or a local governmental agency."
CO Detector #3.
I have been a California resident and homeowner for 70 years. Now the
blanking government is telling ME, that I have to have a carbon monoxide
detector in my personal home! And yes it only costs $25, but I will be
fined if I don't have one. HELLO!? -M.S.
Small Claims. I have been told that if on arrival for a hearing in small claims it is found that the case is to be heard by a pro tem there is an opportunity to request that the case be postponed until a Small Claims Commissioner is available. -Gordon C.
RESPONSE: Yes, you can refuse to waive your rights and wait for the next available commissioner.
CPA Peer Review.
Your article states that the association's CPA should "inquire if the
HOA has performed an annual inspection" of the major components, then
references Civ. Code §1365.5(e) as the source for that requirement. Doesn't the statute say "review" annually, not "inspect"? -Bob F.
RESPONSE: Good catch. The article should have said "review" annually and inspect every three years.
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