New Mold Law — SB 655/ California Health and Safety Code Sections 17920 and 17920.3 Effects California Community Associations

By David Swedelson, Partner at SwedelsonGottlieb, Community Association Attorneys

Signs_of_Mold_in_House.pngEffective January 1, 2016, California Senate Bill 655 amended provisions of the California Health and Safety Code, specifically Sections 17920 and 17920.3. Although the Health and Safety Code impacts almost all persons and entities in California to some extent, SB 655 and the changes it makes to the Code will likely have a more direct impact on California community associations than was even intended by the legislature.

The new legislation adds to the Health and Safety Code a definition for mold as microscopic organisms or fungi that can grow in damp conditions in the interior of a building. It is worth noting that because there is no scientific definition of mold, the new law’s definition is not scientific in nature and may prove vague going forward. More importantly, the changes to the law will add the presence of visible mold to the Health and Safety Code’s recognized list of conditions upon which a residential multi-unit building can be considered as substandard.

Although visible mold growth is being added to the foregoing list of substandard conditions, it is important to remember that the statute will specifically exclude the presence of mold that is “minor and found on surfaces that can accumulate moisture as part of their properly functioning and intended use.” Additionally, the list of conditions in the statute only rise to a “substandard” level to the extent the condition, in this case mold, endangers the life, limb, health, property, safety or welfare of the public or occupants of the building. We expect that there will be some debates on this.

Being declared a substandard building will be considered a violation of the Code and can lead to civil abatement proceedings and a possible misdemeanor conviction (of the members of the board) in criminal court. Civil abatement generally refers to a governmental proceeding seeking to require any person, who creates or maintains a public nuisance caused by violation of any health regulation, to commence corrective work and to complete the work within a reasonable period of time. If the corrective work is not performed, the government may perform the work and charge the costs to the violator (the association) along with administrative costs (which sounds a lot like a reimbursement assessment levied against an owner for common area damage). A misdemeanor is a criminal act, which carries a punishment of no more than a year in jail and a up to a $1,000 fine, or both.

SB 655 and the Code sections it modified impacts community associations, in large part, because of what is not included in the explicit language of the amended statutes. From a practical perspective, this legislation appears intended to regulate apartment buildings owned by landlords and ensure that landlords maintain their rental units and buildings in a habitable condition for tenants. The legislation, however, does not specifically exclude community associations, nor does it state that it only applies to landlord-controlled apartment buildings. As a result, instead of only applying to apartment buildings, now the common areas of a common interest development are arguably subject to the law. This means that the presence of visible mold in an association’s common area (which includes the perimeter walls and ceilings of a condominium unit) could potentially be subject to civil abatement proceedings or result in a misdemeanor conviction against the board members of an association if the association permits mold growth to continue in violation of the Health and Safety Code laws.

Skip Daum, Community Association Institute’s (CAI) legislative advocate in California has advised us that SB 655’s author did not intend for the bill to apply to community associations, but a specific exclusion was not written into the law. CAI’s Legislative Action Committee, along with Skip, opposed the bill and asked Governor Jerry Brown to veto it exactly because of the apparent and practical inapplicability to community associations described above. With the law in place, it is incumbent on association boards and managers to promptly deal with mold issues, regardless of whether the cause of the mold is association or owner responsibility. Water leaks and intrusion should be dealt with immediately by having a reputable contractor that deals water damage remove wet flooring and wall materials, open walls and installing fans to dry out the common area before mold develops. Mold should be remediated as soon as possible, with the determination of responsibility made after that has been accomplished. Not only is this always recommended from a health and safety standpoint, but now the potential for civil abatement and/or even misdemeanor convictions could result if the mold is permitted to remain by an association.

Of course, the association’s responsibility typically extends to the common area lobby or recreational buildings as well as within most walls, most notably the walls and ceilings separating condominium units. Whenever mold exists in such areas, boards and manager should act diligently to resolve the issue without delay, especially because an association’s mold remediation company may have a different opinion from health/code enforcement officers, who are responsible under the statute to make the determinations as to whether mold has created a substandard condition.

Because of the various uncertainty which exists, it is always a good idea to adopt a mold and water intrusion policy which defines and describes the maintenance, reporting and financial responsibility obligations of the owners and association in the event of a water leak or other event which can lead to the presence of mold. If your association has been on the fence as to adopting this type of policy, the new law and heightened consequences for violations, could be the tipping point for moving forward with adoption.

Although we do not believe association boards or managers should be worried about being hauled off to a local jail any time soon, SB 655 and amended California Health and Safety Code Sections 17920 and 17920.3 has made dealing with water intrusion and damage something the board cannot ignore and highlights the need to remediate mold as soon as possible after discovery. No one would argue that the prevention or the elimination of mold is a reasonable standard to be subject to; now it is the law.

David Swedelson is a condo lawyer and HOA attorney and senior partner at SwedelsonGottlieb, a firm that specializes and limits its practice to condominiums, homeowner associations and stock cooperatives throughout California. The firm does not represent individual owners.

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