Bill Text: CA AB1838 | 2011-2012 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Common interest developments: association records.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Passed) 2012-09-23 - Chaptered by Secretary of State - Chapter 475, Statutes of 2012. [AB1838 Detail]

Download: California-2011-AB1838-Amended.html

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BILL NUMBER: AB 1838	AMENDED
	BILL TEXT

	AMENDED IN SENATE  AUGUST 7, 2012
	AMENDED IN ASSEMBLY  MAY 7, 2012
	AMENDED IN ASSEMBLY  APRIL 26, 2012
	AMENDED IN ASSEMBLY  MARCH 21, 2012

INTRODUCED BY   Assembly Member Charles Calderon

                        FEBRUARY 22, 2012

   An act to amend Sections 1368 and 1368.2 of the Civil Code,
relating to common interest developments.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 1838, as amended, Charles Calderon. Common interest
developments: association records.
   The Davis-Stirling Common Interest Development Act defines and
regulates common interest developments, which include community
apartment projects, condominium projects, planned developments, and
stock cooperatives. Existing law specifies certain documents that an
association must provide to a prospective purchaser before transfer
of title to the separate interest or execution of a real property
sales contract, as defined. Existing law also specifies certain
documents that an association must provide to a prospective purchaser
upon request. Existing law prohibits an association from charging
certain assessments, penalties, or fees in connection with a transfer
of title or any other interest, unless an exception applies.
Existing law requires the association to also provide a specified
form that contains an estimate of the costs associated with providing
the prospective purchaser with the requested documents.
   This bill would further prohibit a cancellation fee for the
documents described above if the cancellation was requested in
writing by the same person who placed the order and if work on the
order had not yet been performed or if the work had been compensated.
 The bill would require the association to refund all fees for
the documents described above if the request was canceled in writing
and work on the order had not yet been performed. Additionally, if
the request was canceled in writing, the bill would require the
association to refund the share of fees collected for the above-
  described documents that represents the portion of the
work not performed on the order.  The bill would also require
that the form be written in at least 10-point type.
   Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 1368 of the Civil Code is amended to read:
   1368.  (a) The owner of a separate interest, other than an owner
subject to the requirements of Section 11018.6 of the Business and
Professions Code, shall, as soon as practicable before transfer of
title to the separate interest or execution of a real property sales
contract therefor, as defined in Section 2985, provide the following
to the prospective purchaser:
   (1) A copy of the governing documents of the common interest
development, including any operating rules, and including a copy of
the association's articles of incorporation, or, if not incorporated,
a statement in writing from an authorized representative of the
association that the association is not incorporated.
   (2) If there is a restriction in the governing documents limiting
the occupancy, residency, or use of a separate interest on the basis
of age in a manner different from that provided in Section 51.3, a
statement that the restriction is only enforceable to the extent
permitted by Section 51.3  ,  and a statement specifying the
applicable provisions of Section 51.3.
   (3) A copy of the most recent documents distributed pursuant to
Section 1365.
   (4) A true statement in writing obtained from an authorized
representative of the association as to the amount of the association'
s current regular and special assessments and fees, any assessments
levied upon the owner's interest in the common interest development
that are unpaid on the date of the statement, and any monetary fines
or penalties levied upon the owner's interest and unpaid on the date
of the statement. The statement obtained from an authorized
representative shall also include true information on late charges,
interest, and costs of collection which, as of the date of the
statement, are or may be made a lien upon the owner's interest in a
common interest development pursuant to Section 1367 or 1367.1.
   (5) A copy or a summary of any notice previously sent to the owner
pursuant to subdivision (h) of Section 1363 that sets forth any
alleged violation of the governing documents that remains unresolved
at the time of the request. The notice shall not be deemed a waiver
of the association's right to enforce the governing documents against
the owner or the prospective purchaser of the separate interest with
respect to any violation. This paragraph shall not be construed to
require an association to inspect an owner's separate interest.
   (6) A copy of the initial list of defects provided to each member
of the association pursuant to Section 1375, unless the association
and the builder subsequently enter into a settlement agreement or
otherwise resolve the matter and the association complies with
Section 1375.1. Disclosure of the initial list of defects pursuant to
this paragraph does not waive any privilege attached to the
document. The initial list of defects shall also include a statement
that a final determination as to whether the list of defects is
accurate and complete has not been made.
   (7) A copy of the latest information provided for in Section
1375.1.
   (8) Any change in the association's current regular and special
assessments and fees which have been approved by the association's
board of directors, but have not become due and payable as of the
date disclosure is provided pursuant to this subdivision.
   (9) If there is a provision in the governing documents that
prohibits the rental or leasing of any of the separate interests in
the common interest development to a renter, lessee, or tenant, a
statement describing the prohibition and its applicability.
   (10) If requested by the prospective purchaser, a copy of the
minutes of the meetings, excluding meetings held in executive
session, of the association's board of directors, conducted over the
previous 12 months, that were approved by the association's board of
directors.
   (b) (1) Upon written request, the association shall, within 10
days of the mailing or delivery of the request, provide the owner of
a separate interest, or any other recipient authorized by the owner,
with a copy of the requested documents specified in paragraphs (1) to
(10), inclusive, of subdivision (a). Upon receipt of a written
request, the association shall provide, on the form described in
Section 1368.2, a written or electronic estimate of the fees that
will be assessed for providing the requested documents. The documents
required to be made available pursuant to this section may be
maintained in electronic form, and may be posted on the association's
Internet Web site. Requesting parties shall have the option of
receiving the documents by electronic transmission if the association
maintains the documents in electronic form. The association may
collect a reasonable fee based upon the association's actual cost for
the procurement, preparation, reproduction, and delivery of the
documents requested pursuant to the provisions of this section.
   (2) No additional fees may be charged by the association for the
electronic delivery of the documents requested.
   (3)  (A)   A cancellation fee for documents
specified in subdivision (a) shall not be collected if either of the
following applies: 
   (A) 
    (i)  The request was canceled in writing by the same
party that placed the order and work had not yet been performed on
the order. 
   (B) 
    (ii)  The request was canceled in writing and any work
that had been performed on the order was compensated. 
   (B) The association shall refund all fees collected pursuant to
paragraph (1) if the request was canceled in writing and work had not
yet been performed on the order.  
   (C) If the request was canceled in writing, the association shall
refund the share of fees collected pursuant to paragraph (1) that
represents the portion of the work not performed on the order. 
   (4) Fees for any documents required by this section shall be
distinguished from other fees, fines, or assessments billed as part
of the transfer or sales transaction. Delivery of the documents
required by this section shall not be withheld for any reason nor
subject to any condition except the payment of the fee allowed
pursuant to paragraph (1).
   (5) An association may contract with any person or entity to
facilitate compliance with the requirements of this subdivision on
behalf of the association.
   (6) The association shall also provide a recipient authorized by
the owner of a separate interest with a copy of the completed form
specified in Section 1368.2 at the time the required documents are
delivered.
   (c) (1) Except as provided in paragraph (2), neither an
association nor a community service organization or similar entity
may impose or collect any assessment, penalty, or fee in connection
with a transfer of title or any other interest except for the
following:
   (A) An amount not to exceed the association's actual costs to
change its records.
   (B) An amount authorized by subdivision (b).
   (2) The prohibition in paragraph (1) does not apply to a community
service organization or similar entity, or to a nonprofit entity
that provides services to a common interest development under a
declaration of trust, that is described in subparagraph (A) or (B):
   (A) The community service organization or similar entity satisfies
both of the following requirements:
   (i) The community service organization or similar entity was
established prior to February 20, 2003.
   (ii) The community service organization or similar entity exists
and operates, in whole or in part, to fund or perform environmental
mitigation or to restore or maintain wetlands or native habitat, as
required by the state or local government as an express written
condition of development.
   (B) The community service organization or similar entity, or a
nonprofit entity that provides services to a common interest
development under a declaration of trust, satisfies all of the
following requirements:
   (i) The organization or entity is not an organization or entity
described in subparagraph (A).
   (ii) The organization or entity was established and received a
transfer fee prior to January 1, 2004.
   (iii) On and after January 1, 2006, the organization or entity
offers a purchaser the following payment options for the fee or
charge it collects at time of transfer:
   (I) Paying the fee or charge at the time of transfer.
   (II) Paying the fee or charge pursuant to an installment payment
plan for a period of not less than seven years. If the purchaser
elects to pay the fee or charge in installment payments, the
organization or entity may also collect additional amounts that do
not exceed the actual costs for billing and financing on the amount
owed. If the purchaser sells the separate interest before the end of
the installment payment plan period, he or she shall pay the
remaining balance prior to transfer.
   (3) For the purposes of this subdivision, a "community service
organization or similar entity" means a nonprofit entity, other than
an association, that is organized to provide services to residents of
the common interest development or to the public in addition to the
residents, to the extent community common areas or facilities are
available to the public. A "community service organization or similar
entity" does not include an entity that has been organized solely to
raise moneys and contribute to other nonprofit organizations that
are qualified as tax exempt under Section 501(c)(3) of the Internal
Revenue Code and that provide housing or housing assistance.
   (d) Any person or entity who willfully violates this section is
liable to the purchaser of a separate interest that is subject to
this section for actual damages occasioned thereby and, in addition,
shall pay a civil penalty in an amount not to exceed five hundred
dollars ($500). In an action to enforce this liability, the
prevailing party shall be awarded reasonable attorneys' fees.
   (e) Nothing in this section affects the validity of title to real
property transferred in violation of this section.
   (f) In addition to the requirements of this section, an owner
transferring title to a separate interest shall comply with
applicable requirements of Sections 1133 and 1134.
   (g) For the purposes of this section, a person who acts as a
community association manager is an agent, as defined in Section
2297, of the association.
  SEC. 2.  Section 1368.2 of the Civil Code is amended to read:
   1368.2.  The form for billing disclosures required by Section 1368
shall be in substantially the following form and in at least
10-point type:
CHARGES FOR DOCUMENTS PROVIDED AS REQUIRED BY
SECTION 1368*
Property Address __________________________________
Owner of Property _________________________________
Owner's Mailing Address ______________________
                         (If known or different
_______________________
from property address.)
Provider of the Section 1368 Items:
_________________________________________________
Print Name   Position or Title Association or Agent
___________________
Date Form Completed
Check or Complete Applicable Column or Columns
Below


                                         Not
                                         Available
Document         Civil Code   Included  (N/A) or
                  Section                Not
                                         Applicable
                                         (N/App)
Articles of
Incorporation    Section
or statement     1368(a)(1)   _________ ___________
that not
incorporated
CC&Rs            Section      _________ ___________
                  1368(a)(1)
Bylaws           Section      _________ ___________
                  1368(a)(1)
Operating Rules  Section      _________ ___________
                  1368(a)(1)
Age              Section
restrictions,    1368(a)(2)   _________ ___________
if any
Pro forma
operating        Sections
budget or        1365 and     _________ ___________
summary,         1368(a)(3)
including
reserve study
Assessment and   Sections
reserve funding  1365 and     _________ ___________
disclosure       1368(a)(4)
summary
Financial        Sections
statement review 1365 and     _________ ___________
                  1368(a)(3)
Assessment       Sections
enforcement      1365 and     _________ ___________
policy           1368(a)(4)
Insurance        Sections
summary          1365 and     _________ ___________
                  1368(a)(3)
Regular          Section      _________ ___________
assessment       1368(a)(4)
Special          Section      _________ ___________
assessment       1368(a)(4)
Emergency        Section      _________ ___________
assessment       1368(a)(4)
Other unpaid     Sections
obligations of   1367.1 and   _________ ___________
seller           1368(a)(4)
Approved         Sections
changes to       1365 and     _________ ___________
assessments      1368(a)(4),
                  (8)
Settlement       Sections
notice           1368(a)(6),
regarding        (7) and      _________ ___________
common area      1375.1
defects
                  Sections
Preliminary      1368(a)(6),  _________ ___________
list of defects  1375, and
                  1375.1
Notice(s) of     Sections
violation        1363 and     _________ ___________
                  1368(a)(5)
Required
statement of     Section 1368 _________ ___________
fees
Minutes of
regular
meetings of the
board of         Section
directors        1368(a)(9)   _________ ___________
conducted over
the previous 12
months, if
requested
Total fees for                _________
these documents:
* The information provided by this form may not
include all fees that may be imposed before the
close of escrow. Additional fees that are not
related to the requirements of Section 1368 may be
charged separately.