Great news for HOAs collecting delinquent assessments! After over a year of confusion created by Senate Bill 908, which seemed to require that HOAs be licensed to collect assessments, California's Department of Financial Protection and Innovation (DFPI) decided that routine HOA assessment activities do not require a license.

The DFPI's website posted FAQs that:

• Routine HOA assessments do not constitute a consumer credit transaction under the Debt Collection Licensing Act (DCLA).
   
• Routine HOA assessments are not considered consumer debt.
   
• Collection of assessments does not turn an HOA into an entity engaged in the business of debt collection.

The Association is not a debt collector for the purpose of the Rosenthal Act, because the definition of debt collector is premised upon the act of collecting consumer debt. In other words, because the Court finds that homeowner’s assessments are not a consumer credit transaction for the purpose of the Rosenthal Act, it necessarily follows that the Association cannot be a debt collector under that statute (i.e., the Association does not in the ordinary course of business, regularly, on behalf of that person or others, engage in the collection of consumer debt). (Dickson v. Century Park East; internal quotation marks removed.)

QUESTION: Our HOA supplies each candidate with a form with spaces for their name, biography, and statement of goals. Candidates have a 2-page limit. One candidate submitted 3 pages. We were told we had to accept his long bio because we were not allowed to edit candidate statements. This resulted in complaints by other candidates who followed the rules. This seems unfair. -Inspector of Elections

ANSWER: It is true you cannot edit candidate statements (Civ. Code § 5105(a)) but you do not have to accept their 3-page statement either. You can refuse statements that do not comply with your rules. This is especially true if a candidate advocates a point of view or campaigns in their statement. Advocating a point of view using association resources opens the door to equal access by all members who want their views mailed at the association's expense. (Civ. Code § 5105(a).)

This is why most associations ask for candidate bios only and limit the length of their statements. Many allow candidates to submit a picture with their bio. Even then, some require the picture to be taken recently--not a picture from 30 years ago (truth in advertising).

RECOMMENDATION: Boards/Management/Inspectors of Election should return candidate statements that do not comply with reasonable restrictions on length and content. Have the candidate submit a new statement that complies with the rules. If candidates fail or refuse to do so within allotted deadlines, their statement should not be included in the mailing to the membership. If the association is not evenhanded in the application of their rules, they appear to be biased and there will be an outcry from candidates who comply with the rules.

QUESTION: During our board meetings a motion is made and seconded but no vote is called for. The minutes of the meeting, however, state the motion passed. Is this proper? –William A.

ANSWER: No, it's not proper. It happens because meetings are run by volunteers who are not experienced and may forget to call for a vote. More often than not, discussion after a motion results in a consensus. The president is satisfied that agreement has been reached and moves to the next item of business without realizing a vote needs to be taken. When that happens, it is okay for directors to remind the president to call for a vote.

Boards can contact us--we're friendly and our rates are competitive. Adrian J. Adams, Esq. Founder & Managing Partner ADAMS|STIRLING PLC