Historically many homeowners' associations have, at times, abused their decision making power concerning homeowner's proposed changes to their properties. Such abuses of this power have included associations failing to follow their own standards and procedures, utilizing procedures that are not fair and reasonable, and making decisions in bad faith and which are unreasonable, arbitrary or capricious. The addition of Section 1378 to the California Civil Code is designed to curb these abuses. In the event that the association makes a decision on an application for a change to a homeowner's property, and that decision does not satisfy any of the minimum requirements of Civil Code §1378 set forth below, the association's decision may not be valid or enforceable.
If a homeowners association's governing documents (such as the covenants, conditions and restrictions, or its rules and regulations) require approval by the association before a property owner can make a physical change to his or her property, the association is required to satisfy certain requirements in reviewing and approving or disapproving such a proposed change. Civil Code §1378 requires, at a minimum, that a homeowners association comply with each of the following requirements:
- The association must provide a fair, reasonable and expeditious procedure for making its decision, and that procedure must be included in the association's governing documents. The procedure is required to provide for prompt deadlines, and must state the maximum time the association has to respond to an application or a request for reconsideration by the association's board of directors.
- A decision on a homeowner's proposed change must be made in good faith and may not be unreasonable, arbitrary, or capricious.
- Regardless of what is stated in the association's governing documents, a decision on a proposed change may not violate any governing laws, including, but not limited to, the Fair Employment and Housing Act, a building code or any other applicable law governing land use or public safety.
- A decision on a proposed change must be in writing. Furthermore, if a proposed change is disapproved, the written decision must include: (a) an explanation of why the proposed change is disapproved; and (b) a description of the procedure for reconsideration of the decision by the association's board of directors.
- If a proposed change is disapproved, the applicant is entitled to reconsideration of the decision by the board of directors of the association at an open meeting of the board (unless the members of the board of directors are the same individuals that made the original decision to deny the request for a proposed change and their decision was made at a meeting which satisfies the requirements of the Common Interest Development Open Meeting Act). Additionally, homeowners associations are also required to provide their members, on an annual basis, with notice of any requirements for the associations' approval of physical changes to homeowners' properties in the development. Such notice must describe the types of changes that require association approval, and include a copy of the procedure used to review and approve or disapprove proposed changes.
Lis Pendens - What Everyone Should Know
The judicial action to remove a Lis Pendens is generally a Motion to Expunge Lis Pendens. First, one must explore whether an ownership or possessory interest is in fact the subject of the lawsuit that has been filed with the Court. The types of lawsuits that clearly qualify for attachment of a Lis Pendens are cases that involve the disputed ownership of real property or some portion of real property. Lis Pendens are commonly attached where there is a dispute as to who the true owner of the property is, whether some party has some fractional interest in the property, or such issues that effect the description and characteristics of the property. For example, actions involving real property easements are typically the subject of a Lis Pendens, as are actions between a buyer and a seller as to the right to purchase real property.
In contrast, those bringing a lawsuit that has no connection to the ownership of the property cannot place a Lis Pendens on one's real property. For example, if you are sued for Breach of an Employment Contract by an employee, that employee cannot utilize the mechanism of a Lis Pendens. Likewise any type of contract dispute that has nothing to do with a possessory or ownership interest of the real property in question cannot be the basis of a Lis Pendens upon a person's property. To reiterate, a Lis Pendens is only applicable to a real property claim. C.C.P. § 405.1 Real property claims fall into two basic categories: 1) Title to or the right to possession of specific real property, or 2) the use of an easement identified in the Complaint.
What to do if a Lis Pendens is placed upon Your Property:It should be noted that when a party places a Lis Pendens upon another person's real property they must give written notice to the party owning the real property that they have placed a Lis Pendens on the property. If said notice is not given, it provides another ground for expunging the Lis Pendens, although the party placing the Lis Pendens can go back to the drawing board and refile the Lis Pendens and properly serve the owner of the property, notifying the owner of the existence of the Lis Pendens. It is important to understand that if you receive notice that a Lis Pendens has been placed on your property, by Certified Mail or otherwise, that you should immediately bring it to the attention of your attorney so that your attorney can take appropriate action.
As stated previously, the first question to ask is whether the type of claim being made against the owner of the real property is one in which a Lis Pendens can properly be used. If you are on the receiving end of a Lis Pendens, there are various grounds for expunging or removing a Lis Pendens. A Lis Pendens may be ordered removed, or expunged, from the recorded title by virtue of a Motion brought in Court known as a Motion for Expungement of Lis Pendens. The following situations are reasons or grounds upon which a Lis Pendens may be removed:
- Improper Lis Pendens -- The Lis Pendens is improper because the Complaint does not contain a real property claim. C.C.P. § 405.31
- The Plaintiff cannot establish its "probable validity by a preponderance of the evidence" C.C.P. § 405.32
- The other method of removing or expunging a Lis Pendens is by posting a bond sufficient enough to provide adequate security for damages that the person bringing the lawsuit, i.e., the Plaintiff, may suffer, even if it is a real property claim and it has probable validity. This is often utilized in a commercial setting where money is adequate compensation for the breach of a Contract to purchase real property since the property itself may not be unique (it is merely a part of a commercial transaction). This is in contrast to the situation where the Plaintiff bringing the action has bought a particular home which the Court would find is unique and may not allow a Lis Pendens to be removed by virtue of posting a bond.
Knowledge Is Power - Know The Rules To Protect Your Property Rights
Buying a condo, townhouse or single
family home can present many challenges and rewards, but
buying real estate in a development governed by a homeowners
association (HOA) can be a serious trap for the unwary. Not
only is the property subject to the laws, codes and
ordinances affecting all other residential properties in the
same geographical area; it is also governed by the
covenants, conditions and restrictions of the development,
and the bylaws, and rules and regulations of the
association.
In California, in connection with sale of property governed
by a homeowners association, the seller of the property is
required to provide the buyer with, among other things,
copies of the covenants, conditions and restrictions
("CC&Rs"), bylaws and any other rules and regulations of the
association. These documents are referred to as "governing
documents" of the association. They are, for the most part,
the rules of the road for the association and the
homeowners, and the terms of these documents can seriously
affect your use and enjoyment of the property. It is also
important to know that, in general, California courts will
enforce them if they are fair and reasonable as to the
homeowners in the association as a whole, regardless of
whether they create a hardship or are unfair to a particular
owner based on his or her individual circumstances.
Frequently, when disputes arise between property owners and
their homeowners association, the answer regarding the
disputes can be found in the governing documents, and if the
dispute ripens into a lawsuit, the courts will usually look
first to these documents to determine if they cover the
subject matter of the dispute. If they do apply, and the
court decides that the homeowner has violated them, the
homeowner may be left with not only having to pay for any
damages awarded to the association or comply with the terms
of an injunction concerning the use of the property, but
also having to pay the association's court costs and
attorneys' fees.
However, if a lawsuit is brought to enforce a governing
document (regardless of whether it is brought by the
association or the homeowner), and the Court determines that
the association has acted in excess of its power, the action
taken by the association may be unenforceable, and courts
have granted injunctive relief against associations where it
is shown that the association exceeded the scope of its
authority. In particular, California courts have held that
when an association exceeds its scope of authority,
decisions or rules of the association resulting from its
unauthorized actions are invalid and not enforceable against
the homeowner. Furthermore, if a lawsuit is filed to enforce
one or more of the associations' governing documents, and
the Court finds that the decision of the association or rule
is invalid or unenforceable, by statute, the association may
be required to pay the homeowner's attorneys' fees and court
costs.
So carefully read the CC&Rs, bylaws and rules and
regulations of the homeowners association, and be sure you
can follow them and still live happily in the development.
These "private laws" will affect you if you choose to live
in a development governed by a homeowners association.
Furthermore, if you do own property in such a development,
and you believe that the association is taking inappropriate
action, one of the best ways to protect your rights is to
review these documents thoroughly. By informally pointing
out to the association why its action is unauthorized, you
may be able to stop the association in its tracks without
filing a lawsuit. Thereafter, if the association refuses to
follow its own governing documents and evidence is presented
to the Court of the association's violations, the Court will
likely require the association to cease or correct its
unauthorized actions.
When dealing with homeowners associations, knowing the terms
of the association's governing documents is truly power.