2024 Legal Update and Case Law Review
Feb 10, 2025
The following summary highlights the new laws and significant court decisions impacting community associations in 2025. Unless otherwise noted, all laws outlined below took effect January 1, 2025.
ASSEMBLY BILL (AB) 2114 – Civil Engineers allowed for Structural Inspections.
Assembly Bill (“AB”) 2114 amends Civil Code Section 5551 (balcony/exterior elements inspection) to allow civil engineers to conduct authorized inspections.
This bill adds civil engineers to the category of professionals eligible to provide the inspection and repair requirements required for compliance with elevated exterior structure inspections. While the amendment does not allow communities more time to complete the inspections or necessary repairs, it does give communities more access to qualified professionals to fulfill the Civil Code 5551 requirements.
ASSEMBLY BILL 2159 – Electronic Voting.
AB 2159 allows community associations to use electronic balloting when conducting elections. By amending Civil Code Sections 5105. 5110, 5120, 5125, 5200, and 5260, the language supersedes provisions in the bylaws that would prohibit or restrict electronic voting.
This bill authorizes an association to adopt election rules that allow an association to conduct an election by electronic secret ballot, regardless of limitations existing in the bylaws. All owners will vote electronically unless the owner “opts out” no later than 90 days before an election, in which case that owner will receive a traditional paper ballot. The statute includes additional notices to ensure that owners are aware of key deadlines prior to the election process.
AB 2159 does not allow electronic voting for elections on assessment increases and prohibits nominations from the floor for any director election held electronically.
This law is viewed as an important measure to facilitate community association governance and director elections. Electronic voting is expected to benefit community associations through savings of time and expense experienced in traditional paper ballot elections, and is anticipated to increase member participation in association elections.
ASSEMBLY BILL 2460 – Reduced Quorum Clean up.
AB 2460 is so called “clean up” legislation from last year’s reduced quorum law which provides for a reduced quorum of 20% for adjourned and reconvened membership meetings to elect directors. AB 2460 clarifies some of the procedures for the reconvened membership meeting but leaves the 20% reduced quorum in place.
The revised language makes it clear that the Association has the authority to adjourn a membership for lack of quorum and call a reconvened meeting at which time the quorum will be reduced to 20%. Under AB 2460, the association must provide general notice to the Owners that if quorum is not reached, a reconvened meeting may be held at least 20 days after the scheduled election.
For associations whose bylaws provide for a reduced quorum below 20%, the bylaws will control such that the association will conduct the reconvened meeting using bylaw’s lower percentage.
ASSEMBLY BILL 3057 – Junior Accessory Dwelling Unit (JADU) Exemptions
AB 3057 expands the definition given to structures that are exempt from the California Air Quality Act (CEQA). CEQA has authority to review and approve structures that would require an environmental impact report. Currently, it reviews structures that act as the primary residence on a parcel zoned for a single-family residence. This law allows CEQA to expand the exemption to include the creation of junior accessory dwelling units (“JADUs” in single-family residential zones.
Boards and architectural control committees should review their JADU requirements so that they are aligned with AB 3057 and any applicable CEQA exemptions.
SENATE BILL 504 – Wildfires and Defensible Space.
Senate Bill (SB) 504 expands the number of parties responsible for management of property fire safety measures.
Existing law requires a person who owns, leases, controls, operates, or maintains a building or structure in mostly mountainous, forest, shrub- or grass-covered lands to maintain a defensible space. The new law adds “state responsibility areas” as well as other areas determined by the State Fire Marshal as requiring defensible space compliance. The law now requires any person who owns or operates a building in a state responsibility area to maintain defensible space of 100 feet from each side of the building. The law also reduces from 6 months down to 4 months the amount of time allowed to fulfill the defensible space accountability report.
Senate Bill 900 – Common Interest Developments: Repair and Maintenance.
Senate Bill (SB) 900 adds language to Civil Code Section 4775 obligating associations to restore interrupted utility services such as gas, heat, water, or electrical services, following an outage or service interruption. Associations now are required to begin the process of restoring those components within 14 days, to prevent owners from living without essential services. For associations lacking funds to cover the cost of repairs, the law authorizes the board to obtain a bank loan without owner approval, to start the repair, or to levy an emergency assessment to fund the utility service restoration. The details of any loan must be noted in a resolution outlining why the emergency assessment and repairs are necessary.
If the board is unable to meet quorum during the 14-day period, the law allows a reduced quorum at the next duly noticed board meeting, solely to fulfill the requirements of the approval, loan, and resolution process. The reduced board quorum would have to be noted in time for the next meeting, and if necessary, the board can conduct this board meeting by email.
Finally, the expedited timeline for utility restoration would not apply if the association is in an area affected by a state of disaster or emergency declared by the local, state or federal government.
Senate Bill 1211 - Accessory Dwelling Units.
Senate Bill (SB) 1211 adds language to the Government Code to prohibit a local agency from imposing any objective development or design standards, and otherwise to increase the opportunity for Owners to install ADUs in multifamily communities.
The new law starts off defining livable space to include a space in a dwelling intended for human habitation. It also eliminates off-street parking requirements if an ADU would take the place of the designated parking spaces. Finally, this new law also permits local agencies to approve up to 8 detached ADUs on a lot with an existing multifamily dwelling and up to 2 detached ADUs on a lot with a proposed multifamily dwelling.
Associations should review the new ADU requirements prior to any new approved projects to ensure that their architectural process aligns with SB 1211 and AB 3057.
SENATE BILL 428 – Workplace Restraining Orders
SB 428 was approved and signed in 2023. It expands the ability of employers to seek restraining orders on behalf of employees who are experiencing harassment.
Previously, employers who wanted to expand protection for their employees needed to demonstrate that the employee was exposed to violence or credible threats of violence. With the amended language, SB 428 allows employers to request a restraining order before any violence is experienced or threatened. The language in Code of Civil Procedure 527.8 now matches the harassment language found in the Civil Harassment restraining order offered under Code of Civil Procedure 527.6.
For purposes of the Code of Civil Procedure, Associations are considered employers with their volunteer directors, employees, and even managers or other community agents meeting the definition of employees. Under the expanded definition of workplace restraining orders, Associations may be able to seek protection for any of their “employees” who are being harassed or threatened due to their connection with the community where they are “employed.”
Although previously approved and adopted in 2023, this new law only became active on January 1, 2025.
Case Law Review
Those cases listed here as published are considered binding and available to use as reliable interpretation of law affecting common interest developments.
Cases that are unpublished are not binding and cannot be cited in court documents. However, unpublished cases do demonstrate a judge’s view on new issues and what associations might expect to see when courts weigh in on community decisions.
CALIFORNIA PUBLISHED
Colyear v. Rolling Hills Community Association of Rancho Palos Verdes (2024) 100 Cal.App.5th 110
The “Protected Trees” Case
Not all CC&Rs are created equal. When properties are sold before covenants are recorded, Associations may be unable to enforce every provision in the CC&Rs.
A homeowner challenged the Association’s ability to trim the trees on his property. The Plaintiff homeowner claimed that the tree-trimming covenant in the CC&Rs was not enforceable against properties purchased prior to the recording of the covenant.
In 2015, Plaintiff filed a request with the court to protect his trees after a neighbor attempted to invoke the tree trimming covenant. The Plaintiff asked the court to declare the tree trimming covenant invalid and that the Association could not seek to use that covenant against his trees or property in the future.
The trial court held that when a common plan for subdivision is recorded before the properties are sold, it can be enforced against all of the properties. However, in this case some of the restrictions were not recorded against all of the properties, including the tree trimming provision. The court agreed to enjoin the Association from attempting to apply the tree trimming covenant to the Plaintiff’s property, but denied Plaintiff’s request to correct Plaintiff’s title to reflect that finding. However, it still awarded Plaintiff attorneys fees for prevailing on the covenant issue.
The appellate court affirmed that the Plaintiff was entitled to assurance that the tree trimming covenant did not apply to his property, and that recovery of attorneys’ fees against the Association to achieve that result was proper.
Doskocz v. ALS Lien Services (2024) 102 Cal.App.5th 107
The “No Waiving” Case
Boards must not interfere with protections given to Owners by California and Federal Collection Law when pursuing delinquent assessments. The Courts and Legislature will be strict in holding associations and businesses responsible for collection activity.
A homeowner filed a claim against a company using non-judicial foreclosure to collect delinquent assessments. The homeowner alleged that the company (ALS) was violating state and federal collection practices by, among other violations, mis-applying payments.
The Plaintiff became delinquent on assessments in 2013, and was sent to ALS for collections by their association. ALS sent the required notice of delinquent assessment, and offered the Owners a payment plan to bring the account current. ALS sent payment plan instructions to the Plaintiff, and included a notice that under the payment plan, the Plaintiff would be waiving standard protections. The waiver authorized ALS to apply payments first toward collection costs before assessments, which is contrary to Civil Code Section 5655. After making 5 of the 6 required payments, Plaintiff then failed to make the final payment under the original plan. When ALS added additional collection fees to the file in order to agree to a second payment plan, the Owners only made the payment needed for the final missed payment. ALS sent a default letter threatening foreclosure on the heightened balance before closing the file without collecting the remaining collection amounts stated under the second payment agreement.
Plaintiff filed a suit claiming violations of state and federal collection law. The initial action was filed in federal court in 2015, but was later transferred to state court in 2017 and tried in 2022. Plaintiff argued that when ALS accepted several payments, it was refusing to apply the payments first to the delinquent assessments as required by Civil Code Section 5655. By reducing collection costs before applying payments to the delinquent assessments, the Plaintiff claimed that the threat of foreclosure was on an assessment balance of less than $1800 which was also contrary to Civil Code Section 5720. The trial court agreed, and entered judgment in favor of Plaintiff and similarly situated Owners. ALS appealed.
The appellate court agreed with the trial court. It held that the collection requirements were intended to protect Owners from foreclosure and that ALS was not permitted to require that Owners waive those protections in order to secure a payment plan. The appellate court held that the Civil Code Section 5655 application of payments toward assessments was an essential right that private parties could not contract around. It also found that the threat of foreclosure was not permitted given the balance at the time of the notice. The appellate court upheld the trial court’s award and judgment against ALS.
Haidet v. Del Mar Woods Homeowners Assn., Case No. D082923 (October 21, 2024)
The “Prevailing Party” Case
It is important to remember that Courts have discretion when deciding on the award of attorneys’ fees. While the prevailing party is entitled to the recovery of reasonable attorneys’ fees, a court will decide whether there is a party who achieved their objective as well as whether the fees requested are reasonable for the underlying claims.
A homeowner filed a complaint about the Association’s failure to enforce noise complaints. The Plaintiff claimed the Association was responsible for allowing a nuisance due to improperly installed floors in a neighboring condominium.
The Plaintiff filed the action in 2022 alleging breach of contract, breach of fiduciary duty, and for declaratory relief against the Association. The claims revolved around the nuisance occurring from improper flooring, and alleged that the Association was failing to enforce the CC&Rs. The Association demurred to the original complaint, and the trial court dismissed one of Plaintiff’s claims and ordered the other two claims be amended to survive demurrer. Rather than change the complaint consistent with the court’s instructions, the Plaintiff filed an amended complaint that named parties other than the Association. As a result, the Association requested that it be dismissed from the action with prejudice, while the Plaintiffs requested that they be given an opportunity to return and re-file. The trial court granted the Association’s request to be dismissed with prejudice and awarded attorneys’ fees to the Association for its efforts. The Plaintiffs appealed.
The appellate court reviewed the trial court’s decision. The trial court held that the Association was the prevailing party because by filing the demurrer, the Association achieved its objectives. The appellate court agreed. It found that by failing to include the Association in any amended complaint, the Plaintiffs conceded that they could not amend the complaint sufficiently to meet the corrections required by the trial court. As a result, the appellate court upheld the decision to decide that the Association had prevailed in the primary objective to remove itself from the litigation. The Plaintiff was ordered to pay the attorneys’ fees, including those on appeal.
Eric Woolard v. Regent Real Estate Services, et al., Case No. G062897, December 23, 2024)
The “Neighbor to Neighbor” Case
Management Companies and Associations have limited duties when it comes to enforcing the governing documents with respect to neighbors. Associations and management should take reasonable steps to alert neighbors about violations and reported complaints, but are not required to intervene and prevent neighbor disputes from escalating.
Tenants of two Units at the Greenhouse Community Association (“Association”) were engaged in regular and intense harassment of each other. The harassment continued until it finally escalated into a physical confrontation between the tenants of the two Units, and a lawsuit seeking damage. One of the tenants (“Woolard”), filed a cross complaint including both the Owners of the Unit from whom he rented, as well as the management company and the Association.
As part of the negligence claim against the management and the Association, Woolard cited that some of the behavior cited included intentionally provoking dogs into barking so that one Unit could report noise and nuisance violations against the other Unit. Tenant Woolard argued that because these reports were made to management, and the Board decided to impose penalties, both the Association and management company were involved in the harassment and responsible for the result of the physical altercation. The trial court disagreed. It dismissed the management company and the Association because Woolard failed to cite any duty that was owed to them. Woolard appealed.
The Appellate Court agreed with the trial court. It held that the management company and the Association breached no existing duty of care. The court did acknowledge that this case was complicated by the parties being tenants, however, it declined to create a new duty requiring a homeowner association or its management company to involve itself in disputes between homeowners outside the confines of the governing documents. The Appellate Court acknowledged that associations do not have police or subpoena powers, so they have limited ability to compel owners, much less tenants of owners, to sit down and work out or adjudicate their differences.
FEDERAL PUBLISHED
Morris v. W. Hayden Estates First Addition Homeowners Ass'n, Inc., (June 17, 2024) 382 F.Supp.3d 1093
The “Christmas Light Fight” Case
Associations cannot discriminate on the basis of religion. Any attempt to regulate conduct may expose associations to claims of discrimination when the violations focus on a religious belief or practice.
Plaintiff Homeowners filed a federal action against their Association for refusing to allow them to have a Christmas display and program at their residence. The Plaintiffs claim that when they notified the Board that they intended to host a Christmas display, both the Board and other Owners noted their display was in violation of the governing documents.
The Plaintiffs moved into their residence in West Hayden Estates in 2014. They notified their Association and neighbors that they intended to set up and host an annual Christmas display and program at their new home during the 2015 holiday season. Both the Board and the Association responded that Owners of other faiths might be intimidated by their display, and that it was likely to also bring in undesirable people from outside of community. After completing the 5 night display in 2015 that brought in over 200 people, the Plaintiffs planned to host an even bigger event and program in 2016. By the end of the 2016 event, the Plaintiffs had alienated many Owners in the community. Neighbors complained of traffic, trash, noise, and health and safety concerns.
The Plaintiffs filed a complaint in federal court alleging fair housing claims and discrimination against their religious beliefs. While the jury agreed with the Plaintiffs, the judge reversed the judgment awards. The judge found that the program and display did violate the Association’s CC&Rs and interfered with the quiet enjoyment of other Owners in the community. The judge ordered a new trial. The Plaintiffs appealed.
The 9th Circuit Appellate Court stated that the Plaintiffs did meet their burden to demonstrate Fair Housing violations by the Association. While the Court did not hold the Association responsible for the harassment that the Plaintiffs suffered from other Owners, it did find that the Board made statements that could be construed as discriminatory in nature and against the Plaintiffs Christmas display and program. The Appellate Court ordered a new trial that focused on the Board’s attempt to interfere with the Plaintiff’s purchase and use of their property for a religious display and program.
CALIFORNIA UNPUBLISHED
Taggart v. North Coast Village Homeowners Association, No. D081102 (Nov. 28, 2023)
The “Watch your Language” Case
Although the court gave the Association a pass for its inartful assessment description, Boards need to ensure that the funds collected for regular and special assessments are spent for proper purposes. There is danger in expanding the definition of regular, special, or emergency assessments beyond what the Civil Code will allow.
A homeowner challenged his association’s decision to impose “special” assessments without Owner permission. The homeowner Plaintiff claimed that the Board’s decision to call the amount an additional assessment was intended to avoid needing to get Owner approval on amounts that would otherwise exceed the 5% special assessment limitation under Civil Code Section 5605.
In May 2020, the Board of North Coast Village noticed that the Association’s finances were not adequate to meet the budgeted needs for that year, including increases in insurance, minimum wage, utilities and other expenses. The Board voted to approve an assessment of $1,000 against each Unit, and called it a special assessment. In the notice to the Owners, the Board offered 3 payment options (lump sum, quarterly, or bi-annually) and called it an “additional” assessment. The following year, the Board used the same approach and language to approve another $1,000 special assessment. This time, the Association notified Owners that in addition to raising the monthly assessments, the new amount was simply an "assessment," "fee," or “add-on” and only offered one payment option to make 2 $500 payments. As with the previous year, the Association used the funds for operating expenses.
The Plaintiff sued the Association demanding return of the payments from the prior 2 years. The court found that regardless of how the Board and the Association labeled the assessments, they should have been considered regular assessments because they were used for operating expenses. As a result, the court found in favor of the Association because it had not exceeded the 20% limitation permitted for regular assessment increases. The Plaintiff appealed.
The Plaintiff argued that the Board violated Civil Code Section 5605 because it labeled the amounts as special assessments, and therefore it was limited to imposing up to a 5% assessment without gaining Owner approval. The court found that the difference between regular and special assessments was determined by the use of the funds rather than their title. The court held that the Association’s intent to fund operating expenses meant that as long as the funds were used for that purpose, it was consistent with the intent and language of Civil Code 5605(b).
Mays v. Oakview Homeowners Ass'n Court of Appeal of California, No. D083707 (June 17, 2024)
The “Primary Objective” Case
Another reminder of Courts’ ability to decide which of the claims was the most important in resolving the litigation. Partial victory does not mean a complete recovery of attorneys’ fees.
A homeowner filed a complaint alleging that the Association was refusing to hold elections as required by the law and the governing documents. The Plaintiff homeowner requested that the court remove the invalid directors, require the Association to hold an election, and issue penalties for failure to abide by the governing documents.
After running unsuccessfully for a seat on the Board, the Plaintiff homeowner requested that the court order an election. She claimed that due to the inability to establish quorum in 2020, 2021, and 2022, directors who had been previously elected continued to remain on the Board without replacement. The Plaintiff further claimed that the failure to hold an election was a violation of the Civil Code, as well as the CC&Rs and Bylaws. The Association admitted that it had not met quorum in 2018, 2019, 2020, 2021 or 2022, but that it was unable to hold and election and count ballots because it could not meet quorum as required. The Association argued that it met its burden to schedule the elections, and had already scheduled another election for 2023, but could not replace directors unless the number of ballots were sufficient to meet quorum requirements.
After trial in January 2023, the court granted Plaintiffs request for a judgment on part of her claims. It held that when the Association failed to meet quorum, it was obligated to adjourn the meeting and make another attempt. As a result, the court ordered the Association to conduct an election and replace the directors with expired terms. When the Plaintiff filed a motion to recover the attorneys’ fees, the court denied the request claiming that Plaintiff had not met the primary objective of the litigation. The Plaintiff appealed.
The appellate court found that the CC&Rs and Bylaws did not permit an election to be held without quorum. It also found that one of the Plaintiff’s major objectives/claims were not met at the trial court: an order to remove invalid directors and hold an election without quorum. Although the trial court ordered that a new election be held, neither court found that she achieved her primary objective in removing sitting directors and electing a new board. As a result, the court held that the Plaintiff was not the prevailing party and not entitled to recover attorneys’ fees for a partial victory.
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