QUESTION: Is there any California statute that allows for voiding an HOA election? Our board is in the process of voiding our election because of ballot irregularities and is holding a new election starting with the distribution of new ballots.
ANSWER: Yes, elections can be restarted. Civil Code §5110(c)(8) states that an inspector of elections may "Perform any acts as may be proper to conduct the election with fairness to all members..." If election irregularities are such that the balloting would produce an outcome that could not be trusted, an inspector could void the election and request a new one.
Board Decision. An election could also be restarted by the board of directors. For example, if a candidate on the ballot was not qualified (Civ. Code §5105(a)(3)) or the ballot failed to provide for cumulative voting as required by the governing documents (Civ. Code §5115(c)) or a second envelope was not included with the first (Civ. Code §5115(a)) the board could stop the election and restart it with proper ballots and envelopes. The goal is to have an election that reflects the will of the membership and not end up in court due to irregularities.
RECOMMENDATION: Over the years, I've had to advise boards to restart their election with new ballot materials. So as to minimize confusion, I have them use a different colored paper for the ballots and envelopes. Whenever in doubt, boards should pick up the phone and call legal counsel.
CAN THE MANAGER
INSPECT MY GARAGE?
QUESTION: I own a townhouse with two spaces in front of my garage and two inside my garage. Recently, the manager asked to see a picture of the inside of my garage. The CC&Rs require they be used for cars. I have two vehicles in the garage. Do I have to show a photo or let them inspect my garage? They have not asked other owners to see inside their garages.
ANSWER: Yes, the manager can inspect your garage. The purpose of parking rules is to preserve property values by keeping the development from looking like a parking lot.
Garage Conversions. When it comes to garages, people have a way of converting them into storage units, gyms, home offices, game rooms, bedrooms, etc. If all the board or management sees is two cars parked in front of your garage, they have no way of knowing if you are properly using your garage for parking cars. Since they have a duty to enforce the governing documents, they have a duty to ask.
Discriminatory Enforcement. It has been my experience that owners asked to comply with the rules often assume discriminatory enforcement. Without any evidence, they claim that no one else has been asked to follow the rules. That's possible but rarely the case. Management often has multiple notices out and is trying to persuade people to follow the rules without resorting to hearings and fines whenever possible.
Storing Vehicles. Also, if you are not using the vehicles in your garage but simply storing them, you might consider renting a storage unit for your vehicles or selling them so you can park your other two cars in your garage.
Reasonable Rules. In a 2011 case, Sui v. Price, an owner with a 1987 Mitsubishi van parked it in his exclusive use parking space and left it there when the engine broke down. It stayed inoperable and did not move from 2003 to 2007. After repeated warnings, the association towed the eyesore. Sui sued the association and its president. Sui told the court he refused to move the van because his family, including his children, developed a strong bond with the van. "It was part of their family, just like some people with their pets." The court was not persuaded. It found the association's actions reasonable and ruled against Sui.
RECOMMENDATION: As the Sui case demonstrates, members are subject to rules adopted by their association. In your case, the manager is trying to do her job. A photo emailed from your cell phone to the manager only takes a few seconds. It's not the end of the world for you to send it (unless your garage was converted into storage or has someone living in it).
AND RELIGIOUS ACCOMMODATION
On April 22, a case was handed down by the United States Court of Appeals for the Third Circuit involving segregated swimming for men and women.
Reasonable Accommodation. The Country Place Condominium Association is a 55+ community located in Lakewood, New Jersey. Approximately two-thirds of the association's residents are Orthodox Jews. The association segregated swim times for men and women to accommodate Jewish religious beliefs related to modesty.
The board adopted rules making over two-thirds of all swimming hours throughout the week sex-segregated. An owner who wanted to swim with his wife, who had disabilities after a series of strokes and needed pool therapy to recover, was fined for violating the policy. He sued the association alleging violation of the federal Fair Housing Act.
Sex Discrimination. Although the case involved sex discrimination versus religious beliefs, the association did not raise religious accommodation as a defense. As a result, the only issue before the court was the segregation of swim times based on gender. The court decided this was a clear case of sex discrimination in violation of the Fair Housing Act.
Discrimination Sometimes Justified. The concurring opinion noted that certain other federal circuit courts covering different parts of the country (including the Ninth Circuit) have concluded that policies which are discriminatory on their face may be justified if it can be shown that the policies benefit the protected class or respond to legitimate safety concerns. (Curto v. Country Place.)
RECOMMENDATION: It's unfortunate the association did not raise religious accommodation as a defense. It would have been interesting to see how the court balanced competing interests. Whenever boards contemplate adopting restrictions based on gender or age (children), they will likely be deemed discriminatory. When rules touch those areas, consult legal counsel.
Open Forum Policy #1. Regarding "a reasonable time limit for ALL members to speak," does that mean everyone should have a right to speak for a specified amount of time, or that the length of the open forum can be limited such that not everyone is allowed to speak? Our board is limiting the length of open forum. I think everyone should be allowed to speak. If there are too many people wanting to speak, there is probably something wrong with the way things are being run. And what if one person has multiple issues to bring up? -P.C.
RESPONSE: Yes, the wording of the statute is problematic. It states, "A reasonable time limit for all members of the association to speak...shall be established by the board." (Civ. Code §4925(a).)
Extended Comment Period. As I noted in last week's newsletter, the board can extend the time for open forums, but at some point comments become repetitious. Moreover, the board has business to conduct. The longest meeting I ever attended started at 6:00 p.m. and went to 4:00 a.m. the next morning. The president decided to let everyone speak and then speak again before conducting the board's business. By the time the meeting was over the next morning, everyone was exhausted. That is no way to run a meeting.
City Councils. Sometimes it's helpful to see how cities handle similar situations. Chapter 2, paragraphs 7 and 11 of the "Rules of the Los Angeles City Council" address public comment periods. Citizens are limited to one minute of public comment with a minimum ten minutes for the session. The city council can provide an opportunity for the public to address the council on each agenda item before or during the council’s consideration of the item. Boards have that same discretion. The Los Angeles City Council has more flexibility than HOA boards because it meets three times a week. If it met once a month as most association boards do and allowed unlimited public comments, they would never get any business done.
RECOMMENDATION: Having experienced an open-ended forum first-hand, I am opposed to unlimited sessions. They can become filibusters to prevent boards from conducting business. Unlike city council members, board members are volunteers. They need to get the association's business done so they can return to their families and jobs. If some homeowners aren't able to speak to the board during a particular open forum, they can still write letters and appear at the next board meeting.
Open Forum Policy #2. Like a rule, an HOA board policy [regarding open forum time limits] must go through the regular board approval process with a board vote at a board meeting. Correct? -Robert M.
RESPONSE: No, that's not correct. Time limits are not monthly agenda items; it's a matter of boards conducting their meetings. The person conducting the meeting, normally the president, can adjust times from meeting to meeting depending on the circumstances. I covered this in my April 28 newsletter.
Dog Park. I enjoy reading your newsletter. I just read the item addressing the dog park. This has come up a number of times. This is the poster child of a board assuming a liability it is not obligated to assume. I personally like dog parks and think there are many positives. However, this is the type of decision that should not be made without discussing the impact on it general liability coverage. Specifically, will incidents such as attacks on other dogs or attacks on people be covered under the association’s general liability policy? Will there be limitations on non-association members? Will the association require an indemnification by the dog owner? Will the association require confirmation that the dog be up to date on its shots? I recommend that the board consult with its community association insurance professional. -Joel Meskin, McGowan & Company Insurance
RESPONSE: Good point. Insurance should always be considered when making significant changes to the common areas. In addition to consulting legal counsel when planning a dog park, boards should talk to their insurance agent to make sure their policy provides the coverage they need.
Rule Change #1. I see your version of the Davis-Stirling Act says members must be given 28 days notice. Did this just change in the last year or two? It used to say 30 days. -Rick L.
RESPONSE: Last year's Senate Bill 261 changed the notice requirement for proposed operating rules from 30 to 28 days. The change took effect January 1 of this year. To see all the changes in laws from year to year, go to "New Laws."
Rule Change #2. I love your newsletters. In your most recent email, the discussion "Policy or Rule" implied that Civil Code §4360 applies for all boards contemplating rule changes. Based on my research, notice and approval of a rule change only applies when a board has the authority to adopt rules granted in the governing documents. Some boards do not have this authority. -Gary R.
RESPONSE: Yes, my response assumes the board has authority to adopt rules. Rulemaking authority is covered on our website. I also covered it in my February 10, 2019 newsletter.
Cumulative Voting. In your last newsletter you mentioned cumulative voting. Cumulative voting is a double edged sword. If can help you or harm you. We live in a complex where only about 20% of owners live here full time. If someone gets on the board who is an obstructionist, it is almost impossible to get them off the board because they are incumbents. So yes, I can see if someone has enough supporters cumulative voting can help them stay on the board. Not having cumulative voting can also prevent new people from getting on the board and also makes it almost impossible to get problem incumbents off the board. So cumulative voting is a double edge sword that, based on your circumstances, can both help or hurt you. -Ray O.
RESPONSE: After weighing all the pros and cons, I come down on the side of eliminating cumulative voting (and proxies, and quorum requirements).
Earthquake Insurance. [In response to last week's feedback on insurance] This is not a healthy decision for a board to make. Our board is considering the MOTUS insurance policy that is exactly what this woman is describing! I don’t believe any board of directors would be fulfilling its obligation by voting to accept an earthquake insurance policy such as the one noted. That plan leaves those owners who decline the plan open for possible financial ruin if there is an earthquake. That would also leave the association with damaged buildings. I think it is obvious at this point that the association needs to buy an earthquake insurance plan, one that demonstrates a board responsibility to all owners, making sure everyone is covered. -Angela D.
RESPONSE: A large earthquake is undoubtedly in California's future. If we knew the date and location, owners could wait until just before the event to buy insurance. Unfortunately, we don't know when and where it will occur--only that it will. That means delaying the purchase of insurance is a roll of the dice. Many who are now avoiding the cost of earthquake insurance will suffer the enormous cost of rebuilding and be burdened with crushing special assessments. Many will have no choice but to walk away from their units.
Into the Cloud. I don't care for gambling, which is why I have earthquake insurance on my home. When it comes to protecting the firm, my partners and I decided to move our entire law practice into the cloud--desktops, phones, billing, accounting software, document management, everything. It will allow the firm to withstand a devastating earthquake and continue to service our clients with little or no interruption. We will complete the transition later this year.