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August 29, 2005
MOMMY - WHERE DO RULES COME FROM?
Mommy -- where rules come from?
Well, honey, they have to come from somewhere. Let's see: out of some board members head maybe? The lawyer’s mouth? From some handout at a seminar? From the manager’s “stores” of information? From some other association? Maybe…
However, things tend to work a lot better if the rules come from some authority. That authority might be California law -- since this lawyer practices in California, some local regulations or zoning ordinances, but most importantly, and most often overlooked, they should come directly from authority in the association’s governing documents.
In California, as I assume is the case in other states, homeowner associations need authority in order to promulgate rules and regulations. Sometimes I am asked to review a proposed letter to an owner setting forth all of the punishment that the board wants to lay on the homeowner for some violation. Naturally, I need to know what the homeowner did, and more importantly, I need to check and see if the governing documents provide authority for the board to say that the homeowner cannot do “that”, whatever it is. I need to see if the punishment is authorized by the governing documents or the law. Sometimes I'm asked to review a set of rules and regulations to see if I can give them my “ lawyer blessing”, and I wonder -- where did these rules come from?
Most governing documents, if they are well-crafted, provide certain guidance to the Board of Directors and the association members in the form of restrictions relating to certain things, like pets, parking, architectural changes, etc. If the bylaws and/or restrictions are well-crafted, they will provide authority for the Board of Directors to consider imposing additional rules and regulations on any or all topics noted in the base governing documents. When this kind of language is used, it is usually contemplated that the Board of Directors will fill in some detail to the more broad provisions in the declaration of restrictions. (In California we generally call the restrictions CC&Rs, just for your information.)
For example, the CC&Rs might restrict parking anywhere other than assigned parking spaces. The rules might take this a step further and allow temporary parking for loading and unloading a vehicle in spaces are not otherwise assigned. The rules might allow parking for service vehicles that are providing services in the association for limited period of time. Another example would be that the CC&Rs might restrict owners by allowing for only one pet to be kept in the development. The rules and regulations might set size limits, noise or leash limits, might contain requirements relating to laws, etc.
The fact that the board expands on the CC&Rs in the rules and regulations does not mean that the rules and regulations are null and void because they do not appear in the CC&Rs.
It is a good idea to have proposed rules and regulations reviewed by the association's attorney. If you've done your job as a director or manager, it should simply be a matter (for me) of giving the “ blessing” after assuring that the authority for the specific rules and regulations is clear in the governing documents. There also some cases where the attorney might recommend that particular provisions be proposed as an amendment to the governing documents, rather than a rule, and the same may happen in the reverse if the board thinks that an amendment to the governing documents should be proposed to the membership and the attorney believes a rule will suffice. In our state, approval of the membership of rules and regulations is not required by statute, though it appears in some governing documents. However, boards of directors must circulate rules and regulations to the membership for review and comment prior to adoption. The law provides for 30-day or more comment period, and requires that owners are provided notice of the meeting at which the board will consider the rules and regulations for adoption. The law has a procedure in it which allows a group of homeowners to petition the Board of Directors asking that a vote be taken on any proposed rule or regulation that is approved by the board, that is, a vote to terminate the rule. If the board is required under this statute to put the matter to a vote -- given timing and other issues noted in the statute -- and the owners vote to terminate the rule, the board cannot consider it for proposal within the coming year. There are exceptions for rules needed to address safety issues, etc. There are also exceptions for rules and regulations that come directly out of the governing documents or the law itself. The theory behind the exceptions is that the board has no discretion or authority to change the governing documents or the law, and must sometimes act to prevent disaster, so there is no reason to seek comment and give the owners the opportunity to object to the rule or regulation before it is approved. It also expedites approval and distribution of rules and regulations that reflect the existing governing documents or the law, or that head off a problem.
These provisions are found in the David-Stirling Act at Sections 1357.100 and following.
I think that an important point to note is that it is a good thing to allow the membership time to review a proposed rule before it is adopted by the board. This way, if the owners are awake, and one notes that something the board is proposing is either preposterous, unnforceable, impossible to “police”, or patently unfair (to the membership), before the attorney has to, there may be avoidance of embarrassment and/or a cost savings.
Where did your rules and regulations come from? When was the last time they were reviewed for consistency with Association documents, law, and reasonable practices? It might be a good time to take a look and think about this.
Posted by Beth Grimm at August 29, 2005 10:01 PM