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Berding | Weil Community Association ALERT Newsletter
Legal News and Comments for Community Association Boards and Managers Issue #21 • June 2009
THE ECHO ANNUAL SEMINAR RECAP
The 37th (!) annual seminar of the Executive Council of Home Owners, held last weekend, was very successful. Several hundred attended and the presentations - including assessment collection and bankruptcy, changes in solar and shade law and useful alternative dispute resolution techniques-reflect the diverse work done by those who work for and with community association.
Firm Partner Tyler Berding's presentation, with David Levy, CPA, addressed the ever more important theme of healthy funding and proper budget and reserve disclosures. Partners Steve Weil and Sandy Bonato, along with colleague Jeff Barnett, fielded more than 90 minutes of questions in the
"Ask the Attorneys" program.
In anticipation of the seminar, we distributed to our clients and friends our "Condo Quiz" and many returned their answers to our booth. For those who weren't able to attend, the questions and our answers and comments follow:
THE BERDING|WEIL CONDO QUIZ
California Election Law
1. Who decides whether a meeting should be adjourned if a quorum has not been reached? 
a.The board
b.The election inspector
c.The members at the meeting
The correct answer is: (c)
Comment: Corporations Code 7512(d) says that in the absence of a quorum, any meeting of members may be adjourned by the vote of a majority of the votes represented in person or by proxy but no other business may be transacted.
2. Is the right to vote limited to "members in good standing"? 
a.Depends on what the election rules say
b.Depends on what the bylaws say
c.Depends on whether there has been a hearing to suspend voting rights
d.All of the above
The correct answer is: (d)
Comment: The election rules and bylaws specify voter qualifications (and hopefully are consistent). Typically, those qualifications will include the requirement that a member be "in good standing." Some governing documents will specify that "good standing" means not delinquent in the payment of assessments. Civil Code 1363(h) permits the board to impose discipline on a member so long as the member is afforded the right to a hearing.
3. Can directors be "elected" at a board meeting? 
a.Yes
b.No
The correct answer is: (a)
Comment: Yes, directors are elected via secret written ballot and the ballots can be counted either at a board or a membership meeting. The bylaws must be checked to determine applicable "annual meeting" requirements.
4. The "secret ballot" election law does not apply to: 
a.A vote to remove directors
b.A vote to "give away" exclusive use common area
c.A vote to repeal a rule adopted by the board
d.A vote to approve a large special assessment
The correct answer is: (c)
Comment: In addition to items (a), (b) and (d), the election law (found in Civil Code 1363.03) requires use of the secret ballot for the election of directors, the amendment of governing documents and for the imposition of increases of more than 20% of the annual assessment.
5. The manager can be the election inspector 
a.If authorized by the bylaws
b.If authorized in the election rules
c.If authorized in the management contract
d.Yes, unless objected to by a simple majority of members
The correct answer is: (b)
Comment: The election inspector must be an "independent third party or parties" (one or three). Neither the manager, the attorney nor anyone else who receives fees for services rendered the Association may be an election inspector unless, under Civil Code 1363.03(c)(2), expressly authorized by the election rules.
What Are Your Issues? Here are Ours!
Our Condo Quiz was a small selection of the issues and questions that are frequently posed to us in our role as counsel to hundreds of homeowner associations. In the last month, issues we advised our clients on include these:
CC&R restatements and spot amendments (parking, rentals)
Assessment bond claims
Responsibility for interior damage
Medical marijuana plants
Security, Landscaping, Paving and Construction contracts
Solar energy policy
Disability requests
Comcast contracts
Assessment collection lawsuits
Senior housing residency restrictions
T-Mobile tower licenses
No board quorums
Commercial condominium lien issues
Building re-leveling issues
Proxy fights
Reimbursement assessment/self help disputes
Street tree issues
Lender foreclosure issues
Maintenance responsibility
Election challenges
We know you face these and other issues. If we can help, give us a call.
Tyler Berding Honored as Echo's
"Volunteer of the Year"
By Steven S. Weil, Esq.
Tyler Berding was recognized this year as Echo's "Volunteer of the Year".
As many of you know, Tyler has become increasingly interested in and concerned about the number of common interest developments that lack a sound financial strategy for addressing long term replacement needs.
Many of his articles on the topic have been published in ECHO and his presentations, for ECHO and other organizations, have been extraordinarily well received. As one of the leaders in the community association field, Tyler has "stepped up" to sound a note of caution about property values, building safety and the need for sound financial planning in the future.
We at Berding|Weil were very proud that ECHO chose to acknowledge those efforts this year.

TOP ISSUES
QUESTION OF THE WEEK
Question:
"What is a Loft?"
Answer:
A loft refers more to an architectural style than a form of ownership. Traditionally a loft has been defined as a unit with high ceilings with an upper level that looks down to the lower level. Often lofts are conversion projects from older industrial or warehouse buildings. Typically lofts are condominiums or Co-ops.
Are Apartments a Better Answer to the Housing Crisis?
Sometime in the early sixties, a large California developer opened its first development of condominiums for sale.
Even by the standards of the day, they were offered at rock bottom prices.
A home for a single family that could be bought for $10,000.00 was big news…»
Negligent Conversion?
Is the converter liable for failing to properly assemble the parts of a new community?
"Negligent conversion" is another way of saying that mistakes were made when joining all of the required pieces of a conversion project together.
The converter of an apartment building into condominiums basically has three choices under the existing law in California…»
The Board's Dilemma
Every board faces this dilemma sooner or later: how to raise revenue without raising assessments?
Since the only revenue the average association can obtain is from owner assessments, that's usually impossible.
Owners want the board to maintain and repair the association's property, but they don't want to pay more each month, especially in these difficult economic times…»
What You See
is (Not Necessarily)
What You Get!
"Visual and Accessible" is not enough: Let's amend the Davis-Stirling Act to delete Limitations on Reserve Study Inspections
It's the responsibility of every California community association to commission a reserve study every three years…»
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All Rights Reserved.
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