HOA Law Blog
By David Swedelson and Cyrus Koochek, Community Association Attorneys at SwedelsonGottlieb
Since the old Davis-Stirling Act was made into law in 1985, there has been a small debate over whether an owner or their association is responsible for temporary relocation costs incurred when owners in a common interest development are required to vacate their units or homes for common area repairs. Former California Civil Code Section 1364(c) stated that the “costs of temporary relocation during the repair and maintenance of the areas within the responsibility of the association shall be borne by the owner of the separate interest affected.” On its own, this provision seems clear enough; however, because this language was found in the code section that also dealt with termite fumigation, and because it followed the provision dealing with termite fumigation, some owners were confused and debated the issue with their association’s board and management, claiming that unless the relocation was as a result of a treatment for termites, their association had to pay their relocation costs. They were confused and wrong.
Taking the location of this provision into context, it is easy to understand why confusion arose. Immediately preceding the temporary relocation costs provision was a subsection devoted to explaining whether the association or the individual owners are responsible for repairs and maintenance of areas subject to wood-destroying pests and organisms. This had led to some owners and others to question whether the temporary relocation costs provision was intended to apply only to wood-destroying pests and organisms, or for all circumstances resulting in temporary relocations. There really was no debate, as the section that dealt with temporary relocation was separate from the section dealing with wood destroying pests. But it was apparently confusing.
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The body of statutory law (as opposed to case law) governing California Community Associations, known as the Davis-Stirling Common Interest Development Act, went into effect on January 1, 1986. As the industry developed and matured over the last 27 years, approximately 50 changes and amendments were made to the Act. While those adjustments were well-intended, the net effect yielded a disorganized and confusing body of law. To address this problem, a multi-year effort was launched to rewrite the Davis-Stirling Act. This “new” Davis-Stirling Act, signed into law in 2012, becomes the guiding law for California residential community associations on January 1, 2014. So you are probably asking what are the major changes and how does the re-write affect reserve funding issues? The answer is no major changes have been made regarding reserve funding. For the most part, the new updated law amounts to new set of Civil Code references for reserve funding matters. Fortunately, the majority of the changes are just re-organization and renumbering. But there have been changes made to the Act as it applies to reserves.