California Condo & HOA Law

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June 30, 2005

TAPING MEETINGS

I think I said I was not going to say anymore about taping meetings but a website visitor asked the question of whether the Board could videotape an association meeting, wondering whether the authority had to be written somewhere, like in the Bylaws. It would be my opinion that a Board is authorized to tape (video or audio) any of the Association meetings, whether or not the authority is actually embodied in words in the Bylaws or other documents. Of course at the outset I would advise any HOA to listen to their own lawyer about this. What people do not think about is what that means. If the Association creates a tape the questions arise as to whether the tape or the minutes is the official record of the meeting. And does that mean owners can videotape or audiotape meetings. And what happens if a tape is erased afterward, or goes missing ("HOAgate" - I can see it now.) I don't profess to know much about other states and what the laws are with regard to taping, but I know at least this in California - it is illegal to tape someone without their knowledge. This would apply to an HOA meeting. And this means that if anyone is taping, they must announce it. Other questions then arise: will people be willing to participate if being taped? Will anyone alter or distort the taped conversations or meetings afterward? What will happen to any tapes after the meetings? What happens if someone who was not taping the meeting wants to listen to or see the tapes? What if others want copies? What if someone wants copies of transcripts of meeting tapes, for a year ... for 10 years? Must they be provided? Who would pay the cost of the transcription?

It is my opinion that the Board makes all the decisions about taping (at least in California), meaning when to do it, when to allow it, and what to do with any tapes produced. However, the cavaet is that other attorneys may not agree with that and so, as always, I believe an association has to listen to its own attorney about this. But, if an attendee wants to tape a meeting, and the Board does not want taping going on for whatever reasons (chilling talk, disruption, possible misuse of tape, etc.), then I am willing to argue my position that the Board is in control of meeting decorum. I would go head to head with any attorney attempting to make an argument that owners have a right to tape meetings regardless of what the board allows. The worst example I ever saw of an owner trying to secretly tape a meeting was an attorney, who was acting wierd in his chair, squirming and turning and reaching in his side pocket again and again, and actually trying his best to elicit some kind of damaging statement out of 3 board members with leading questions - without success. Luckily ... they knew more than he did ... and ... they had me. I hope the lawyer was duly embarrassed when the click went off and he was "outed". He should have been. The only bad part was there was no one else there to witness his gaff.

Posted by Beth Grimm at 8:43 PM

June 24, 2005

DEVELOPER "LOW BALLING"

I was asked the question the other day from a reader - "I live in a fairly new association (8 years old) and we do not have fancy amenities. I pay $175 per month for assessments. Yet the brand new development being built by the same builder across the street, with very similar structure, and very similar amenities, are being offered with assessments at $125 per month. What's up?" I answered that there could be several reasons for that. One possibility is due to what I call "developer low-balling". At least in California, there are DRE (Department of Real Estate) recommended budgets that characteristically are set too low for continued operations. The developers use those budgets to estimate expenses. Sometimes the developer will bear some of the initial operating costs (like landscaping, irrigation, insurance costs, etc.), until the project is built out. If they spend extra to keep the lawns and common areas very green during the sales period, and pay the costs, homeowners are hit with an increase immediately when the last units are sold. Sometimes the owners cannot afford to keep all of the irrigated landscape green and have to make changes to plants that need less water. Sometimes components are not listed on the original reserve study because they either were not built out when the study was first done or were added later to make an area look nicer, and these things were not apparent when the preparer did his or her inspection. So, it is very common for assessments to increase considerably (there are legal limits of course) in the first 2 or 3 years after the developer relinquishes control. Illegal?? Not really. Misleading - yes, quite. But it can be a combination of things, some within the developer's control, some not. It's kinda like when you sign a contract for a remodel job and the costs just escalate - seemingly for no good reason. (I always secretly estimate for myself another 25% add on to any bid for any work on the house.) That's life in the world of property ownership.

Posted by Beth Grimm at 9:45 AM

June 17, 2005

What To Do About the Idiot Neighbor - Or - How To Succeed Without A Lawyer

I read the blog with interest that ended with the question "If anyone has any ideas about what to do with the idiot neighbor, I'd like to know." Since I represent individual owners in legal matters as well as associations, I often hear folks complain about the idiot owner, the idiot manager, the idiot tenant, the idiot board member, the idiot neighbor, and sometimes even their idiot lawyer. Often, by the time they get to me, they are exasperated, frustrated and feel they are without options. Sometimes they are entrenched in litigation and want out so bad they can taste it, because it isn't satisfying their "need for justice"; to the contrary, it is draining and exhausting them, financially and emotionally.

So here are a few things to try first, for any dealing with any idiots.

1. Try talking to them, if they are not scary.
2. If they are scary, you might want to consider selling right away, or alternatively, getting the neighborhood involved through neighborhood watch, help from the police, the board, and a savvy attorney, organized and working together to eliminate the problem from the neighborhood (not easy but often do-able). Idiots (and especially criminals) do not like to be watched.
2. For noise issues (or other nuisance-type issues), if talking does nothing, and the noise issue or nuisance is truly unreasonable, try the local no cost or low cost mediation service in your town or county. In California, there are such organizations supported by a portion of the funds paid to file a court action. Believe me, good mediators are usually trained to deal with idiots. ("We" call them "difficult people" though, and there is lots of training available). Sometimes a mediator can even lead an idiot into looking and feeling like an idiot if they are squirrelly enough and then they start to get more "pliable". Sometimes people do not realize they are being idiots until someone "helps" them see it.
3. Unreasonably loud noise, junk and crap in the front yard, barking dogs, dilapidated vehicles parked on the lawn and other such problems are private nuisances (if they only affect a neighbor) and public nuisances (if they affect all who pass by). They are actionable (meaning it is possible damages could be awarded or a court order to stop the conduct could be arranged) in a court of law. Small claims court is a reasonable forum to test your own theory that it (whatever is occurring) is a nuisance. It's cheap, and quick. If you get a favorable judgment on just one occasion, the idiot next door will probably change their conduct. A trip down to the SC Court is generally a real pain in the rear (unless you like people watching as a sport). However, it can nip bad conduct in the bud. One example of a suggestion that I can mention was for an owner (who could not afford an attorney) who lived on the second floor of a condo building surrounding the pool area. She was unable to enjoy her balcony in the evenings. It seemed that the manager, once off duty, would "cavort" (strongest word I can use in public) in the pool or on the pool deck with her boyfriend and engage in embarrassing conduct (embarrassing for everyone else, apparently not for her). I suggested the owner videotape the pool activities and take the tape into small claims court and ask for compensation for the nuisance. It was cheaper than paying an attorney to write a letter and god knows, I would not especially want to be the voyeur that had to describe the conduct in court! And I felt that if the manager did not want to be videotaped, she would stop "cavorting" in public. So it did not require any secret videotaping. The woman called me back and said that her investment in a camera paid off. This can work some other situations as well.
4. Recognize that they are an idiot, if they truly are, consider this: if you think they are there for the long term, it might be better to sell your place before starting a battle that elevates to the point where you have to disclose it when you try to sell the place.
5. If there is an Association and the conduct constitutes a violation of existing rules or other governing documents (and note, there is almost always a nuisance provision), notify the Association and ask that the rule be enforced. Of course, if the person is an idiot the board may have no more of a clue than you do how to solve the issues. And if the Board members turn out to be idiots too, you may end up paying the cost as a member of the association without having any control over the situation.
6. Keep in mind that some might view you as the idiot so try to see the picture through their eyes for a moment, just in case.

I have other ideas, like advising a board to set up a video camera at meetings if owners get out of hand regularly and the directors cannot get through business without incessant interruptions. Even if they goof up the taping of the meeting, it probably won't matter because the video camera if set up facing the audience in the room will probably serve as a deterrent to kindergarten conduct. However, I have to warn the Board members that if they don't know what they are doing and tape themselves breaking the law, or looking imcompetent, that is not good. And if the Board tapes a meeting it will likely trigger a demand by owners to tape meetings, and that gets into legal arguments as to whether owners have a right to tape meetings or not. The laws are different in different states so beware of who you quote. Some say yes and some say no -- and some are right.

I suggest to neighbors who are bothered by neighbor's (or their own for that matter) dog barking that they purchase a device that is advertised to stop a dog within so many feet from barking because of the emission of a high pitched sound that is undesirable to dogs but that humans cannot hear. I see these devices in the Skymall Magazine every time I fly (its on the web too). I think that's a fair tool. As for California questions, I advise neighbors bothered by unreasonable barking that if 3 neighbors within a certain number of feet from the dwelling of the barking dog culprit complain to animal control, animal control staff are supposed to report that to the District Attorney in the County and the DA can bring charges. (I doubt they often do but the fact that there is a law that allows for that is often enough of a deterrent to the barking dog's "master".)

I advise neighbors who are bothered by those idiots or criminals who are making their lives miserable to join together (assuming there is evidence of some nuisance activity going on) and file individual small claims actions against the owner of the home where the problem people live. (I find that the worst problem people are usually renters and this is the way to get the owners attention.) I suggest asking for the max (in California, its $5,000 in most cases) amount of damages, one claim per family member, per family, and see what happens. This puts the owner in the position of facing a multi-thousand dollar judgment instead of a $100 fine. At the very least, it tends to get the owner's undivided attention for the entire morning or afternoon sitting in small claims court with all the neighbors glaring at them. However, don't overstep this with an idiotic complaint or a gross lack of evidence or testimony about specifics or the judge or court referee might be so unsympathetic as to find a way to make you pay (or suffer).

Well, that's about all I have time for at the moment. These are all remedies that for the most part do not require an attorney ("even better" you say). Of course, the help of a knowlegeable, savvy, non-litigation minded attorney is worth every penny in situations involving idiots ... For more, visit the californiacondoguru!

Posted by Beth Grimm at 2:07 PM

June 8, 2005

Is it Good To Be A "Self-Managed" HOA in California

Boards come to me with the question - should we have professional management? And I always respond that someone once said (not me of course): "A self-managed association is an "unmanaged" association". My favorite phrase (based on something a classmate of mine in Law School said many times) is that many "self-managed" associations are "doomed".

That is of course unless the Board members are trained properly in the requirements for HOA management. Some boards have had bad experiences with professional management and some have actually been the victim of fraud, theft of funds, etc., via a crafty manager. However, self managed associations have also been taken for a ride by "cookie-toting" grandmotherly board members no one would ever suspect of deviousness. So the key is?? Implementation of educational training and seeking the benefit of experienced persons including service providers (which can be learned through seminar attendance, reading, sharing stories, brainstorming with other association directors and owners and listening to others, searching websites for information etc.), and sufficient checks and balances in the financial systems to raise a red flag if anything "funny" happens.

Posted by Beth Grimm at 3:31 PM

June 1, 2005

When to Amend? That is the Question.

When should associations amend, update or restate their governing documents? Well, I can only speak for California - and I would say because of the prolific legislature, every year would be good. Ha, you say, that is simply not possible, nor affordable. True. Amending or restating the governing documents requires a process, often considered long, dull, and demanding on the Board members and committee members. It requires owner approval, sometimes a "supermajority of votes" like 75% or more. It costs a lot of money. It requires trying to get owners to respond (kinda like trying to get a turtle to run). It sometimes draws out the biggest complainers in the Association and sometimes requires the Board to go "face-to-face" with the meanest, most critical residents. It's work. It's important. And it's usually do-able with a good plan or strategy and the help of a competent professional.

However, it's not the only solution to getting a guiding document that is a useful tool in providing information about what new laws there are and how they affect existing (old or even fairly new) documents. If your association documents are more than 10 years old, and you are trying to use them in today's world, you are at a distinct disadvantage. If they are more than 20 years old, you probably have given up on them (or if you are using them you may be doomed! ("Doomed" - a favorite word of my study partner in law school that I still find useful in some contexts).

Even if your documents are only 2-5 years old, a "tune-up" may be required to keep you abreast of requirements for board members, managers and owners in CIDs.

Get more information on amending and restating documents, and in case you can't do that for some reason, on getting a document "tune-up" at http://www.californiacondoguru.com.

Posted by Beth Grimm at 11:30 AM