Current Affairs

January 21, 2019

AB 2912 Fraud and Embezzlement//Fidelity Bonds & Financial Review

From the Community Association Attorneys at SwedelsonGottlieb new_laws_2019_rev_pdf_-_Google_Drive-2-300x141

It is no secret that community associations are often targets for embezzlement. But they are not alone. Newspaper articles tell us that it happens to various types of businesses and organizations, even attorneys and lawyer/bar organizations. Fraud and embezzlement seems more likely to occur when no one is watching those that control the checkbooks. And unfortunately, many many condominium, stock cooperative and planned development boards of directors become too trusting and they don’t keep an eye on what their manager or treasurer are doing.

To ensure that community associations are better protected, the California legislature passed AB 2912, acknowledging that associations are susceptible to fraud and embezzlement, and that more is needed to completely achieve the goal of protecting community association funds. Pay close attention as there are new requirements for both managers and boards amending two sections of Civil Code and adding three new ones. AB 2912 made the following changes to the law:

January 17, 2019

California Legislature Fixes the Law on Member Notice & Notice of Rule Changes-Amends Civil Code §4040 and Civil Code §4360

by David C. Swedelson

By the Community Association Attorneys at SwedelsonGottlieb new_laws_2019_rev_pdf_-_Google_Drive-3-300x147

Through SB 261, the California Legislature fixed some issues with prior legislation dealing with delivery of notices and related matters and generally fixed some issues that had come up after prior legislation was adopted. This bill became effective in January 1st and amends the following existing sections of the Civil Code as stated:

• Email Consent to Document Delivery — Civil Code §4040 (Individual Notice), which allows for individual delivery of notices and other documents by email if an owner consents to this in writing was amended to allow an individual owner to permit/revoke consent to allow individual notice by email. While most attorneys thought that an email was considered a writing, this amendment eliminates any confusion.

April 17, 2018

SB1265 – A Dumb Idea for a Bad Law

by David C. Swedelson

Stupid-law A senate bill seeking to prohibit California community associations from establishing qualifications for candidates to run for their boards of directors among other changes and requirements (including possible invasion of owner privacy) is a dumb idea that would create bad law.

On April 5th, Los Angeles Times’ Sacramento columnist George Skelton noted that the California legislature passed nearly 1,000 bills in 2017: “A few were important. Most were not. Many were frivolous, some dumb – a waste of politicians’ time and public money. . . There are many bills pending in the legislature again this year that the state could do just fine without.”

One bill I think the State could do just fine without is SB1265. And if you live in a California community association, I think you’ll agree. You should IMMEDIATELY let the legislature know that this legislation is unnecessary, and that the State could do just fine without SB1265. Let me explain how I and many others in the industry came to this conclusion.

October 23, 2016

Minimum Wage Increase Will Have An Impact On California Community Associations

by David C. Swedelson

From the Community Association Attorneys at SwedelsonGottlieb

The minimum wage is going up. As a result of a change in the law to take effect on January 1, 2017, the statewide minimum wage will gradually increase over the next six years until it hits $15 per hour. Further, Los Angeles and San Francisco already have their own laws in place to hit this mark even sooner and may see higher increases depending on the rate of inflation as measured by the Consumer Price Index (CPI).

The wage increase will affect an associations existing employees and will likely impact any association’s existing and potential vendor contracts. Roughly one-third of all California employees are paid minimum wage, and many vendors serving associations rely heavily on minimum wage employees. In the past, California has increased the minimum wage by 1-3% annually, but the pending increase represents a 50% rise over six years, which represents a considerable cost for any vendor to absorb. As a result, vendors will undoubtedly pass along their higher labor costs to the associations they serve.

October 23, 2016

New Law Requires That California Community Associations/HOAs Request That Members Provide Their Contact Information — New Civil Code § 4041

by David C. Swedelson

new_leglisation_notice_to_owners_to_provide_contact_information_-_Google_Search.png By the Community Association Attorneys at SwedelsonGottlieb.

Starting January 1, 2017, every California community association will be required to ask its members to provide their contact information and property status. New Civil Code § 4041 will require, starting January 1, 2017, that each association must solicit the following information from its members:

1. The mailing address where notices from the association are to be delivered;

October 23, 2016

Update To Fair Housing Act Requires Community Associations to Act on Discriminatory Conduct and Harrassment

by David C. Swedelson

From the Community Association Attorneys at SwedelsonGottlieb

An update to the Fair Housing Act, effective October 14, 2016, clarifies an association’s responsibility to address discriminatory conduct and harassment by its residents. The Fair Housing Act prohibits discrimination in housing and housing-related services due to race, color, religion, sex, national origin, disability, and familial status (42 U.S.C. 3601 et seq.). Quid Pro Quo and Hostile Environment Harassment and Liability for Discriminatory Housing Practices Under the Fair Housing Act

This update to the Fair Housing Act clarifies that an association is directly liable for failing to take prompt action to end any third party’s discriminatory housing practice if the association knew or should have know about it and had the power to correct it. A commentator for the U.S. Department of Housing and Urban Development stated, “a community association generally has the power to respond to third-party harassment by imposing conditions authorized by the association’s CC&Rs or by other legal authority […].”* Accordingly, an association must take some action to address any alleged discrimination by residents or other people within its authority.

August 17, 2016

Has The Pokemon GO Craze Impacted Your California HOA?

by David C. Swedelson

By David Swedelson, Partner at SwedelsonGottlieb, Community Association Attorneys

Google_Image_Result_for_http___blogs-images_forbes_com_olliebarder_files_2015_09_pokemon_go_title_jpg.png Have you noticed some unusual behavior from some association residents lately? You may have seen them walking outside swiping their smartphones. They may have a newfound interest in going to parks. And when they talk, they use unfamiliar words like Pikachu, Snorlax, and Pokéstops. If this sounds familiar, then your residents are into Pokémon GO.

I have heard about this new phenomena, but knew little about it. I saw an article entitled Back In The Race: The Employer’s Guide To Understanding (And Dealing With) Pokemon GO that was directed to law firms and decided to use it as the basis for this blog post as to how Pokemon GO would impact California community associations. (Follow this link to read the article)

August 15, 2016

Zika Virus and Your Community Association

by David C. Swedelson

By David Swedelson, Partner at SwedelsonGottlieb, Community Association Attorneys

communityassociationlawblog_com-Zika_Virus_and_Your_Community_Association__1_page_.png Although the Zika Virus has not yet been found in California, that does not mean that it will not find it’s way here. Florida community association attorney and blogger Donna DiMaggio Berger addresses a community association’s obligation to protect owners and residents from the foreseeable risk of harm from something inside the community and adds the Zika Virus to the list. Maybe we in California should take note. (follow this link to read Donna’s blog)

As Donna states regarding an association’s obligation to protect residents from harm, “[w]hether or not that duty is spelled out in the governing documents, there is the expectation that the association will ensure that residents do not get sucked into a non-compliant pool drain and drowned, trapped inside an unsafe elevator or mugged in the parking lot.”

April 11, 2016

Catch the Second Episode of The HOA Show with Sandra Gottlieb!

by David C. Swedelson

SwedelsonGottlieb’s Senior Partner Sandra Gottlieb is honored to make another appearance on the second “episode” of The HOA Show, an educational luncheon presented by the Channel Islands Chapter of Community Associations Institute. Join us on April 26th for this fun format, where you can find out more about the following topics:

• Current events, trends and ideas occurring in the HOA industry and your communities • Is HOA living all negative? Navigating your way through Homeowner complaints, issues and demands.

• New industry developments & technology news: drones, electronic voting and dealing with issues of potential defamation on social media • Privacy Issues: Can members record a board meeting and use it as evidence against the board? Can boards enforce a “no recording” policy?

April 4, 2016

CAI Government Affairs Announces That Freddie Mac, Fannie Mae Release Uniform Condominium Questionnaire For Condominium Unit Loans

by David C. Swedelson

The following is reposted from Community Association Institute’s (CAI) Government Affairs Division:

Freddie_Mac__Fannie_Mae_Release_Uniform_Condominium_Questionnaire_Initiative.png
On March 29, federal housing agencies Freddie Mac and Fannie Mae released a standardized set of lender questionnaires for condominium unit mortgages. The Uniform Condominium Questionnaire is intended to reduce the burden on community associations that routinely provide condominium project information to mortgage lenders.

To comply with Freddie Mac and Fannie Mae mortgage purchase guidelines, mortgage lenders must verify financial and property standards for condominium projects. Over the past two years, Freddie Mac and Fannie Mae worked with CAI and the mortgage lender community to develop a uniform condominium questionnaire to ease the process of obtaining this information. Lenders will now have two options when requesting information from a condominium association.