Reader Questions - Rules

board members c c & rs h o a homefront reader questions Apr 25, 2016

Dear Mr. Richardson,

Our board frequently adopts new rules, generally following the required process of providing 30-day notice prior to voting at an open meeting.

Examples include charging deposits before issuing keys to common area entry locks and levying restrictions upon the display of holiday decorations. Another is requiring an umbrella liability insurance policy prior to approving parties in the common areas.

The new rules are documented only in the board meeting minutes. Consequently, many of these rules have been “lost” throughout the years as homeowners come and go and memories fade. Where should new or modified rules be documented?

Thanks for your weekly column – it is quite informative and I wish our board would take the time to read it regularly.

D.W., Cerritos

Dear D.W.,

Not every decision by a board is a “rule”. Per Civil Code 4365(b), decisions regarding common area maintenance, setting of assessments, or decisions which are specific to one situation are not “rules” and do not require the rulemaking process. However, the rules you describe do fit within the scope of “operating rule” under Civil Code 4355(a) – they address how common area is used. The final step in the rule-making process is to issue a general notice of the rule change no later than 15 days after the board decision, per Civil Code 4360(c). In your association situation, there is another problem – the rules still must be written. Civil Code 4350(a) requires that operating rules must be written. Many associations pass “house rules” which are not written and therefore not given to the owners. If it is not written, it is not a rule.

An increasing number of associations maintain HOA web sites – this is a great way to make sure all owners can easily retrieve copies of the basic documents – subdivision map or condominium plan, CC&Rs, Bylaws and all rules.

Thanks,
Kelly

Dear Kelly,

The board at my HOA decreed via a rule that all owners have to asphalt [a certain area] of surface. Can a rule impose such an unfunded cost to a unit I owned since the 1980s? Is that kind of rule legal? The next board could simply change it or order my house painted pink at my expense? What are my options other than compliance? Wait for the fine and fight it, comply and sue them for costs?

J.C., Truckee

Dear J.C.,

Associations can adopt architectural policies which compel all owners to follow certain standards. However, a board which suddenly imposes a new expense on all members may provoke a strong membership reaction. If a board completely misreads the community’s desires, Civil Code 4365 provides a process by which the entire membership may vote to overturn a very unpopular rule change.

This process is very rarely used, for two reasons. First, smart boards back away from adopting a rule if they see at the meeting the issue is controversial. Second, it is hard to get members to vote on anything, so such petition efforts often fail because it is much easier to start the petition (5% of eligible members) than it is to actually win the membership vote – because quorum usually is not met.

When adopting standards which will involve members immediately being in noncompliance, advance notice is a good idea.

Best,
Kelly


Written by Kelly G. Richardson

Kelly G. Richardson Esq., CCAL, is a Fellow of the College of Community Association Lawyers and a Partner of Richardson | Ober | DeNichilo LLP, a California law firm known for community association advice. Submit questions to [email protected]. Past columns at www.hoahomefront.com. All rights reserved®.