• California Codes
  • California Civil Code
    • CIVIL CODE SECTION 1350-1376

1350.  This title shall be known and may be cited as the
Davis-Stirling Common Interest Development Act.



1351.  As used in this title, the following terms have the following
meanings:
   (a) "Association" means a nonprofit corporation or unincorporated
association created for the purpose of managing a common interest
development.
   (b) "Common area" means the entire common interest development
except the separate interests therein.  The estate in the common area
may be a fee, a life estate, an estate for years, or any combination
of the foregoing.  However, the common area for a planned
development specified in paragraph (2) of subdivision (k) may consist
of mutual or reciprocal easement rights appurtenant to the separate
interests.
   (c) "Common interest development" means any of the following:
   (1) A community apartment project.
   (2) A condominium project.
   (3) A planned development.
   (4) A stock cooperative.
   (d) "Community apartment project" means a development in which an
undivided interest in land is coupled with the right of exclusive
occupancy of any apartment located thereon.
   (e) "Condominium plan" means a plan consisting of (1) a
description or survey map of a condominium project, which shall refer
to or show monumentation on the ground, (2) a three-dimensional
description of a condominium project, one or more dimensions of which
may extend for an indefinite distance upwards or downwards, in
sufficient detail to identify the common areas and each separate
interest, and (3) a certificate consenting to the recordation of the
condominium plan pursuant to this title signed and acknowledged by
the following:
   (A) The record owner of fee title to that property included in the
condominium project.
   (B) In the case of a condominium project which will terminate upon
the termination of an estate for years, the certificate shall be
signed and acknowledged by all lessors and lessees of the estate for
years.
   (C) In the case of a condominium project subject to a life estate,
the certificate shall be signed and acknowledged by all life tenants
and remainder interests.
   (D) The certificate shall also be signed and acknowledged by
either the trustee or the beneficiary of each recorded deed of trust,
and the mortgagee of each recorded mortgage encumbering the
property.
   Owners of mineral rights, easements, rights-of-way, and other
nonpossessory interests do not need to sign the condominium plan.
Further, in the event a conversion to condominiums of a community
apartment project or stock cooperative has been approved by the
required number of owners, trustees, beneficiaries, and mortgagees
pursuant to Section 66452.10 of the Government Code, the certificate
need only be signed by those owners, trustees, beneficiaries, and
mortgagees approving the conversion.
   A condominium plan may be amended or revoked by a subsequently
acknowledged recorded instrument executed by all the persons whose
signatures would be required pursuant to this subdivision.
   (f) A "condominium project" means a development consisting of
condominiums.  A condominium consists of an undivided interest in
common in a portion of real property coupled with a separate interest
in space called a unit, the boundaries of which are described on a
recorded final map, parcel map, or condominium plan in sufficient
detail to locate all boundaries thereof.  The area within these
boundaries may be filled with air, earth, or water, or any
combination thereof, and need not be physically attached to land
except by easements for access and, if necessary, support.  The
description of the unit may refer to (1) boundaries described in the
recorded final map, parcel map, or condominium plan, (2) physical
boundaries, either in existence, or to be constructed, such as walls,
floors, and ceilings of a structure or any portion thereof, (3) an
entire structure containing one or more units, or (4) any combination
thereof.  The portion or portions of the real property held in
undivided interest may be all of the real property, except for the
separate interests, or may include a particular three-dimensional
portion thereof, the boundaries of which are described on a recorded
final map, parcel map, or condominium plan.  The area within these
boundaries may be filled with air, earth, or water, or any
combination thereof, and need not be physically attached to land
except by easements for access and, if necessary, support.  An
individual condominium within a condominium project may include, in
addition, a separate interest in other portions of the real property.

   (g) "Declarant" means the person or group of persons designated in
the declaration as declarant, or if no declarant is designated, the
person or group of persons who sign the original declaration or who
succeed to special rights, preferences, or privileges designated in
the declaration as belonging to the signator of the original
declaration.
   (h) "Declaration" means the document, however denominated, which
contains the information required by Section 1353.
   (i) "Exclusive use common area" means a portion of the common
areas designated by the declaration for the exclusive use of one or
more, but fewer than all, of the owners of the separate interests and
which is or will be appurtenant to the separate interest or
interests.
   (1) Unless the declaration otherwise provides, any shutters,
awnings, window boxes, doorsteps, stoops, porches, balconies, patios,
exterior doors, doorframes, and hardware incident thereto, screens
and windows or other fixtures designed to serve a single separate
interest, but located outside the boundaries of the separate
interest, are exclusive use common areas allocated exclusively to
that separate interest.
   (2) Notwithstanding the provisions of the declaration, internal
and external telephone wiring designed to serve a single separate
interest, but located outside the boundaries of the separate
interest, are exclusive use common areas allocated exclusively to
that separate interest.
   (j) "Governing documents" means the declaration and any other
documents, such as bylaws, operating rules of the association,
articles of incorporation, or articles of association, which govern
the operation of the common interest development or association.
   (k) "Planned development" means a development (other than a
community apartment project, a condominium project, or a stock
cooperative) having either or both of the following features:
   (1) The common area is owned either by an association or in common
by the owners of the separate interests who possess appurtenant
rights to the beneficial use and enjoyment of the common area.
   (2) A power exists in the association to enforce an obligation of
an owner of a separate interest with respect to the beneficial use
and enjoyment of the common area by means of an assessment which may
become a lien upon the separate interests in accordance with Section
1367 or 1367.1.
   (l) "Separate interest" has the following meanings:
   (1) In a community apartment project, "separate interest" means
the exclusive right to occupy an apartment, as specified in
subdivision (d).
   (2) In a condominium project, "separate interest" means an
individual unit, as specified in subdivision (f).
   (3) In a planned development, "separate interest" means a
separately owned lot, parcel, area, or space.
   (4) In a stock cooperative, "separate interest" means the
exclusive right to occupy a portion of the real property, as
specified in subdivision (m).
   Unless the declaration or condominium plan, if any exists,
otherwise provides, if walls, floors, or ceilings are designated as
boundaries of a separate interest, the interior surfaces of the
perimeter walls, floors, ceilings, windows, doors, and outlets
located within the separate interest are part of the separate
interest and any other portions of the walls, floors, or ceilings are
part of the common areas.
   The estate in a separate interest may be a fee, a life estate, an
estate for years, or any combination of the foregoing.
   (m) "Stock cooperative" means a development in which a corporation
is formed or availed of, primarily for the purpose of holding title
to, either in fee simple or for a term of years, improved real
property, and all or substantially all of the shareholders of the
corporation receive a right of exclusive occupancy in a portion of
the real property, title to which is held by the corporation.  The
owners' interest in the corporation, whether evidenced by a share of
stock, a certificate of membership, or otherwise, shall be deemed to
be an interest in a common interest development and a real estate
development for purposes of subdivision (f) of Section 25100 of the
Corporations Code.
   A "stock cooperative" includes a limited equity housing
cooperative which is a stock cooperative that meets the criteria of
Section 33007.5 of the Health and Safety Code.



1352.  This title applies and a common interest development is
created whenever a separate interest coupled with an interest in the
common area or membership in the association is, or has been,
conveyed, provided, all of the following are recorded:
   (a) A declaration.
   (b) A condominium plan, if any exists.
   (c) A final map or parcel map, if Division 2 (commencing with
Section 66410) of Title 7 of the Government Code requires the
recording of either a final map or parcel map for the common interest
development.


1352.5.  (a) No declaration or other governing document shall
include a restrictive covenant in violation of Section 12955 of the
Government Code.
   (b) Notwithstanding any other provision of law or provision of the
governing documents, the board of directors of an association,
without approval of the owners, shall amend any declaration or other
governing document that includes a restrictive covenant prohibited by
this section to delete the restrictive covenant, and shall restate
the declaration or other governing document without the restrictive
covenant but with no other change to the declaration or governing
document.
   (c) If after providing written notice to an association requesting
that the association delete a restrictive covenant that violates
subdivision (a), and the association fails to delete the restrictive
covenant within 30 days of receiving the notice, the Department of
Fair Employment and Housing, a city or county in which a common
interest development is located, or any person may bring an action
against the association for injunctive relief to enforce subdivision
(a).  The court may award attorney's fees to the prevailing party.



1353.  (a) A declaration, recorded on or after January 1, 1986,
shall contain a legal description of the common interest development,
and a statement that the common interest development is a community
apartment project, condominium project, planned development, stock
cooperative, or combination thereof.  The declaration shall
additionally set forth the name of the association and the
restrictions on the use or enjoyment of any portion of the common
interest development that are intended to be enforceable equitable
servitudes.
   (b) The declaration may contain any other matters the original
signator of the declaration or the owners consider appropriate.




1353.  (a) (1) A declaration, recorded on or after January 1, 1986,
shall contain a legal description of the common interest development,
and a statement that the common interest development is a community
apartment project, condominium project, planned development, stock
cooperative, or combination thereof.  The declaration shall
additionally set forth the name of the association and the
restrictions on the use or enjoyment of any portion of the common
interest development that are intended to be enforceable equitable
servitudes.  If the property is located within an airport influence
area, a declaration, recorded after January 1,  2004, shall contain
the following statement:


                  NOTICE OF AIRPORT IN VICINITY

          This property is presently located in the vicinity of an
    airport, within what is known as an airport influence area.
    For that reason, the property may be subject to some of the
    annoyances or inconveniences associated with proximity to
    airport operations (for example: noise, vibration, or odors).
    Individual sensitivities to those annoyances can vary from
    person to person.  You may wish to consider what airport
    annoyances, if any, are associated with the property before
    you complete your purchase and determine whether they are
    acceptable to you.

   (2) For purposes of this section, an "airport influence  area,"
also known as an "airport referral area," is the area in which
current or future airport-related noise, overflight, safety, or
airspace protection factors may significantly affect land uses or
necessitate restrictions on those uses as determined by an airport
land use commission.
   (3) The statement in a declaration acknowledging that a property
is located in an airport influence area does not constitute a title
defect, lien, or encumbrance.
   (b) The declaration may contain any other matters the original
signator of the declaration or the owners consider appropriate.




1353.5.  (a) Except as required for the protection of the public
health or safety, no declaration or other governing document shall
limit or prohibit, or be construed to limit or prohibit, the display
of the flag of the United States by an owner on or in the owner's
separate interest or within the owner's exclusive use common area, as
defined in Section 1351.
   (b) For purposes of this section, "display of the flag of the
United States" means a flag of the United States made of fabric,
cloth, or paper displayed from a staff or pole or in a window, and
does not mean a depiction or emblem of the flag of the United States
made of lights, paint, roofing, siding, paving materials, flora, or
balloons, or any other similar building, landscaping, or decorative
component.
   (c) In any action to enforce this section, the prevailing party
shall be awarded reasonable attorneys' fees and costs.



1354.  (a) The covenants and restrictions in the declaration shall
be enforceable equitable servitudes, unless unreasonable, and shall
inure to the benefit of and bind all owners of separate interests in
the development.  Unless the declaration states otherwise, these
servitudes may be enforced by any owner of a separate interest or by
the association, or by both.
   (b) Unless the applicable time limitation for commencing the
action would run within 120 days, prior to the filing of a civil
action by either an association or an owner or a member of a common
interest development solely for declaratory relief or injunctive
relief, or for declaratory relief or injunctive relief in conjunction
with a claim for monetary damages, other than association
assessments, not in excess of five thousand dollars ($5,000), related
to the enforcement of the governing documents, the parties shall
endeavor, as provided in this subdivision, to submit their dispute to
a form of alternative dispute resolution such as mediation or
arbitration.  The form of alternative dispute resolution chosen may
be binding or nonbinding at the option of the parties.  Any party to
such a dispute may initiate this process by serving on another party
to the dispute a Request for Resolution.  The Request for Resolution
shall include (1) a brief description of the dispute between the
parties, (2) a request for alternative dispute resolution, and (3) a
notice that the party receiving the Request for Resolution is
required to respond thereto within 30 days of receipt or it will be
deemed rejected.  Service of the Request for Resolution shall be in
the same manner as prescribed for service in a small claims action as
provided in Section 116.340 of the Code of Civil Procedure.  Parties
receiving a Request for Resolution shall have 30 days following
service of the Request for Resolution to accept or reject alternative
dispute resolution and, if not accepted within the 30-day period by
a party, shall be deemed rejected by  that party. If alternative
dispute resolution is accepted by the party upon whom the Request for
Resolution is served, the alternative dispute resolution shall be
completed within 90 days of receipt of the acceptance by the party
initiating the Request for Resolution, unless extended by written
stipulation signed by both parties.  The costs of the alternative
dispute resolution shall be borne by the parties.
   (c) At the time of filing a civil action by either an association
or an owner or a member of a common interest development solely for
declaratory relief or injunctive relief, or for declaratory relief or
injunctive relief in conjunction with a claim for monetary damages
not in excess of five thousand dollars ($5,000), related to the
enforcement of the governing documents, the party filing the action
shall file with the complaint a certificate stating that alternative
dispute resolution has been completed in compliance with subdivision
(b).  The failure to file a certificate as required by subdivision
(b) shall be grounds for a demurrer pursuant to Section 430.10 of the
Code of Civil Procedure or a motion to strike pursuant to Section
435 of the Code of Civil Procedure unless the filing party certifies
in writing that one of the other parties to the dispute refused
alternative dispute resolution prior to the filing of the complaint,
that preliminary or temporary injunctive relief is necessary, or that
alternative dispute resolution is not required by subdivision (b),
because the limitation period for bringing the action would have run
within the 120-day period next following the filing of the action, or
the court finds that dismissal of the action for failure to comply
with subdivision (b) would result in substantial prejudice to one of
the parties.
   (d) Once a civil action specified in subdivision (a) to enforce
the governing documents has been filed by either an association or an
owner or member of a common interest development, upon written
stipulation of the parties the matter may be referred to alternative
dispute resolution and stayed.  The costs of the alternative dispute
resolution shall be borne by the parties.  During this referral, the
action shall not be subject to the rules implementing subdivision (c)
of Section 68603 of the Government Code.
   (e) The requirements of subdivisions (b) and (c) shall not apply
to the filing of a cross-complaint.
   (f) In any action specified in subdivision (a) to enforce the
governing documents, the prevailing party shall be awarded reasonable
attorney's fees and costs.  Upon motion by any party for attorney's
fees and costs to be awarded to the prevailing party in these
actions, the court, in determining the amount of the award, may
consider a party's refusal to participate in alternative dispute
resolution prior to the filing of the action.
   (g) Unless consented to by both parties to alternative dispute
resolution that is initiated by a Request for Resolution under
subdivision (b), evidence of anything said or of admissions made in
the course of the alternative dispute resolution process shall not be
admissible in evidence, and testimony or disclosure of such a
statement or admission may not be compelled, in any civil action in
which, pursuant to law, testimony can be compelled to be given.
   (h) Unless consented to by both parties to alternative dispute
resolution that is initiated by a Request for Resolution under
subdivision (b), documents prepared for the purpose or in the course
of, or pursuant to, the alternative dispute resolution shall not be
admissible in evidence, and disclosure of these documents may not be
compelled, in any civil action in which, pursuant to law, testimony
can be compelled to be given.
   (i) Members of the association shall annually be provided a
summary of the provisions of this section, which specifically
references this section.  The summary shall include the following
language:
   "Failure by any member of the association to comply with the
prefiling requirements of Section 1354 of the Civil Code may result
in the loss of your rights to sue the association or another member
of the association regarding enforcement of the governing documents."

   The summary shall be provided either at the time the pro forma
budget required by Section 1365 is distributed or in the manner
specified in Section 5016 of the Corporations Code.
   (j) Any Request for Resolution sent to the owner of a separate
interest pursuant to subdivision (b) shall include a copy of this
section.



1355.  (a) The declaration may be amended pursuant to the governing
documents or this title.  Except as provided in Section 1356, an
amendment is effective after (1) the approval of the percentage of
owners required by the governing documents has been given, (2) that
fact has been certified in a writing executed and acknowledged by the
officer designated in the declaration or by the association for that
purpose, or if no one is designated, by the president of the
association, and (3) that writing has been recorded in each county in
which a portion of the common interest development is located.
   (b) Except to the extent that a declaration provides by its
express terms that it is not amendable, in whole or in part, a
declaration which fails to include provisions permitting its
amendment at all times during its existence may be amended at any
time.  For purposes of this subdivision, an amendment is only
effective after (1) the proposed amendment has been distributed to
all of the owners of separate interests in the common interest
development by first-class mail postage prepaid or personal delivery
not less than 15 days and not more than 60 days prior to any approval
being solicited; (2) the approval of owners representing more than
50 percent, or any higher percentage required by the declaration for
the approval of an amendment to the declaration, of the separate
interests in the common interest development has been given, and that
fact has been certified in a writing, executed and acknowledged by
an officer of the association; and (3) the amendment has been
recorded in each county in which a portion of the common interest
development is located.  A copy of any amendment adopted pursuant to
this subdivision shall be distributed by first-class mail postage
prepaid or personal delivery to all of the owners of separate
interest immediately upon its recordation.



1355.5.  (a) Notwithstanding any provision of the governing
documents of a common interest development to the contrary, the board
of directors of the association may, after the developer of the
common interest development has completed construction of the
development, has terminated construction activities, and has
terminated his or her marketing activities for the sale, lease, or
other disposition of separate interests within the development, adopt
an amendment deleting from any of the governing documents any
provision which is unequivocally designed and intended, or which by
its nature can only have been designed or intended, to facilitate the
developer in completing the construction or marketing of the
development.  However, provisions of the governing documents relative
to a particular construction or marketing phase of the development
may not be deleted under the authorization of this subdivision until
that construction or marketing phase has been completed.
   (b) The provisions which may be deleted by action of the board
shall be limited to those which provide for access by the developer
over or across the common area for the purposes of (a) completion of
construction of the development, and (b) the erection, construction,
or maintenance of structures or other facilities designed to
facilitate the completion of construction or marketing of separate
interests.
   (c) At least 30 days prior to taking action pursuant to
subdivision (a), the board of directors of the association shall mail
to all owners of the separate interests, by first-class mail, (1) a
copy of all amendments to the governing documents proposed to be
adopted under subdivision (a) and (2) a notice of the time, date, and
place the board of directors will consider adoption of the
amendments.  The board of directors of an association may consider
adoption of amendments to the governing documents pursuant to
subdivision (a) only at a meeting which is open to all owners of the
separate interests in the common interest development, who shall be
given opportunity to make comments thereon.  All deliberations of the
board of directors on any action proposed under subdivision (a)
shall only be conducted in such an open meeting.
   (d) The board of directors of the association may not amend the
governing documents pursuant to this section without the approval of
the owners, casting a majority of the votes at a meeting or election
of the association constituting a quorum and conducted in accordance
with Chapter 5 (commencing with Section 7510) of Part 3 of Division 2
of Title 1 of, and Section 7613 of, the Corporations Code.  For the
purposes of this section, "quorum" means more than 50 percent of the
owners who own no more than two separate interests in the
development.


1356.  (a) If in order to amend a declaration, the declaration
requires owners having more than 50 percent of the votes in the
association, in a single class voting structure, or owners having
more than 50 percent of the votes in more than one class in a voting
structure with more than one class, to vote in favor of the
amendment, the association, or any owner of a separate interest, may
petition the superior court of the county in which the common
interest development is located for an order reducing the percentage
of the affirmative votes necessary for such an amendment.  The
petition shall describe the effort that has been made to solicit
approval of the association members in the manner provided in the
declaration, the number of affirmative and negative votes actually
received, the number or percentage of affirmative votes required to
effect the amendment in accordance with the existing declaration, and
other matters the petitioner considers relevant to the court's
determination.  The petition shall also contain, as exhibits thereto,
copies of all of the following:
   (1) The governing documents.
   (2) A complete text of the amendment.
   (3) Copies of any notice and solicitation materials utilized in
the solicitation of owner approvals.
   (4) A short explanation of the reason for the amendment.
   (5) Any other documentation relevant to the court's determination.

   (b) Upon filing the petition, the court shall set the matter for
hearing and  issue an ex parte order setting forth the manner in
which notice shall be given.
   (c) The court may, but shall not be required to, grant the
petition if it finds all of the following:
   (1) The petitioner has given not less than 15 days written notice
of the court hearing to all members of the association, to any
mortgagee of a mortgage or beneficiary of a deed of trust who is
entitled to notice under the terms of the declaration, and to the
city, county, or city and county in which the common interest
development is located that is entitled to notice under the terms of
the declaration.
   (2) Balloting on the proposed amendment was conducted in
accordance with all applicable provisions of the governing documents.

   (3) A reasonably diligent effort was made to permit all eligible
members to vote on the proposed amendment.
   (4) Owners having more than 50 percent of the votes, in a single
class voting structure, voted in favor of the amendment.  In a voting
structure with more than one class, where the declaration requires a
majority of more than one class to  vote in favor of the amendment,
owners having more than 50 percent of the votes of each class
required by the declaration to vote in favor of the amendment voted
in favor of the amendment.
   (5) The amendment is reasonable.
   (6) Granting the petition is not improper for any reason stated in
subdivision (e).
   (d) If the court makes the findings required by subdivision (c),
any order issued pursuant to this section may confirm the amendment
as being validly approved on the basis of the affirmative votes
actually received during the balloting period or the order may
dispense with any requirement relating to quorums or to the number or
percentage of votes needed for approval of the amendment that would
otherwise exist under the governing documents.
   (e) Subdivisions (a) to (d), inclusive, notwithstanding, the court
shall not be empowered by this section to approve any amendment to
the declaration that:
   (1) Would change provisions in the declaration requiring the
approval of owners having more than 50 percent of the votes in more
than one class to vote in favor of an amendment, unless owners having
more than 50 percent of the votes in each affected class approved
the amendment.
   (2) Would eliminate any special rights, preferences, or privileges
designated in the declaration as belonging to the declarant, without
the consent of the declarant.
   (3) Would impair the security interest of a mortgagee of a
mortgage or the beneficiary of a deed of trust without the approval
of the percentage of the mortgagees and beneficiaries specified in
the declaration, if the declaration requires the approval of a
specified percentage of the mortgagees and beneficiaries.
   (f) An amendment is not effective pursuant to this section until
the court order and amendment have been recorded in every county in
which a portion of the common interest development is located.  The
amendment may be acknowledged by, and the court order and amendment
may be recorded by, any person designated in the  declaration or by
the association for that purpose, or if no one is designated for that
purpose, by the president of the association.  Upon recordation of
the amendment and court order, the declaration, as amended in
accordance with this  section, shall have the same force and effect
as if the amendment were adopted in compliance with every requirement
imposed by the governing documents.
   (g) Within a reasonable time after the amendment is recorded the
association shall mail a copy of the amendment to each member of the
association, together with a statement that the amendment has been
recorded.



1357.  (a) The Legislature finds that there are common interest
developments that have been created with deed restrictions which do
not provide a means for the property owners to extend the term of the
declaration.  The Legislature further finds that covenants and
restrictions, contained in the declaration, are an appropriate method
for protecting the common plan of developments and to provide for a
mechanism for financial support for the upkeep of common areas
including, but not limited to, roofs, roads, heating systems, and
recreational facilities.  If declarations terminate prematurely,
common interest developments may deteriorate and the housing supply
of affordable units could be impacted adversely.
   The Legislature further finds and declares that it is in the
public interest to provide a vehicle for extending  the term of the
declaration if owners having  more than 50 percent of the votes in
the association choose to do so.
   (b) A declaration which specifies a termination date, but which
contains no provision for extension of the termination date, may be
extended by the approval of owners having more than 50 percent of the
votes in the association or any greater percentage specified in the
declaration for an amendment thereto.  If the approval of owners
having more than 50 percent of the votes in the association is
required to amend the declaration, the term of the declaration may be
extended in accordance with Section 1356.
   (c) Any amendment to a declaration made in accordance with
subdivision (b) shall become effective  upon recordation in
accordance with Section 1355.
   (d) No single extension of the terms of the declaration made
pursuant to this section shall exceed the initial term of the
declaration or 20 years, whichever  is less.  However, more than one
extension may occur pursuant to this section.



1358.  (a) In a community apartment project, any conveyance,
judicial sale, or other voluntary or involuntary transfer of the
separate interest includes the undivided interest in the community
apartment project.  Any conveyance, judicial sale, or other voluntary
or involuntary transfer of the owner's entire estate also includes
the owner's membership interest in the association.
   (b) In a condominium project the common areas are not subject to
partition, except as provided in Section 1359.  Any conveyance,
judicial sale, or other voluntary or involuntary transfer of the
separate interest includes the undivided interest in the common
areas.  Any  conveyance, judicial sale, or other voluntary or
involuntary transfer of the owner's entire estate also includes the
owner's membership interest in the association.
   (c) In a planned development, any conveyance, judicial sale, or
other voluntary or involuntary transfer of the separate interest
includes the undivided interest in the common areas, if any exist.
Any  conveyance, judicial sale, or other voluntary or involuntary
transfer of the owner's entire estate also includes the owner's
membership interest in the association.
   (d) In a stock cooperative, any conveyance, judicial sale, or
other voluntary or involuntary transfer of the separate interest
includes the ownership interest in the corporation, however
evidenced.  Any  conveyance, judicial sale, or other voluntary or
involuntary transfer of the owner's entire estate also includes the
owner's membership interest in the association.
   Nothing in this section prohibits the transfer of exclusive use
areas, independent of any other interest in a common interest
subdivision, if authorization to separately transfer exclusive use
areas is expressly stated in the declaration and the transfer occurs
in accordance with the terms of the declaration.
   Any restrictions upon the severability of the component interests
in real property which are contained in the declaration shall not be
deemed conditions repugnant to the interest created within the
meaning of Section 711 of the Civil Code.  However, these
restrictions shall not extend beyond the period in which the right to
partition a project is suspended under Section 1359.



1359.  (a) Except as provided in this section, the common areas in a
condominium project shall remain undivided, and there shall be no
judicial partition thereof.  Nothing in this section shall be deemed
to prohibit partition of a cotenancy in a condominium.
   (b) The owner of a separate interest in a condominium project may
maintain a partition action as to the entire project as if the owners
of all of the separate interests in the project were tenants in
common in the entire project in the same proportion as their
interests in the common areas.  The court shall order partition under
this subdivision only by sale of the entire condominium project and
only upon a showing of one of the following:
   (1) More than three years before the filing of the action, the
condominium project was damaged or destroyed, so that a material part
was rendered unfit for its prior use, and the condominium project
has not been rebuilt or repaired substantially to its state prior to
the damage or destruction.
   (2) Three-fourths or more of the project is destroyed or
substantially damaged and owners of separate interests holding in the
aggregate more than a 50-percent interest in the common areas oppose
repair or restoration of the project.
   (3) The project has been in existence more than 50 years, is
obsolete and uneconomic, and owners of separate interests holding in
the aggregate more than a 50-percent interest in the common area
oppose repair or restoration of the project.
   (4) The conditions for such a sale, set forth in the declaration,
have been met.


1360.  (a) Subject to the provisions of the governing documents and
other applicable provisions of law, if the boundaries of the separate
interest are contained within a building, the owner of the separate
interest may do the following:
   (1) Make any improvements or alterations within the boundaries of
his or her separate interest that do not impair the structural
integrity or mechanical systems or lessen the support of any portions
of the common interest development.
   (2) Modify a unit in a condominium project, at the owner's
expense, to facilitate access for persons who are blind, visually
handicapped, deaf, or physically disabled, or to alter conditions
which could be hazardous to these persons.  These modifications may
also include modifications of the route from the public way to the
door of the unit for the purposes of this paragraph if the unit is on
the ground floor or already accessible by an existing ramp or
elevator.  The right granted by this paragraph is subject to the
following conditions:
   (A) The modifications shall be consistent with applicable building
code requirements.
   (B) The modifications shall be consistent with the intent of
otherwise applicable provisions of the governing documents pertaining
to safety or aesthetics.
   (C) Modifications external to the dwelling shall not prevent
reasonable passage by other residents, and shall be removed by the
owner when the unit is no longer occupied by persons requiring those
modifications who are blind, visually handicapped, deaf, or
physically disabled.
   (D) Any owner who intends to modify a unit pursuant to this
paragraph shall submit his or her plans and specifications to the
association of the condominium project for review to determine
whether the modifications will comply with the provisions of this
paragraph.  The association shall not deny approval of the proposed
modifications under this paragraph without good cause.
   (b) Any change in the exterior appearance of a separate interest
shall be in accordance with the governing documents and applicable
provisions of law.



1360.5.  (a) No governing documents shall prohibit the owner of a
separate interest within a common interest development from keeping
at least one pet within the common interest development, subject to
reasonable rules and regulations of the association.  This section
may not be construed to affect any other rights provided by law to an
owner of a separate interest to keep a pet within the development.
   (b) For purposes of this section, "pet" means any domesticated
bird, cat, dog, aquatic animal kept within an aquarium, or other
animal as agreed to between the association and the homeowner.
   (c) If the association implements a rule or regulation restricting
the number of pets an owner may keep, the new rule or regulation
shall not apply to prohibit an owner from continuing to keep any pet
that the owner currently keeps in his or her separate interest if the
pet otherwise conforms with the previous rules or regulations
relating to pets.
   (d) For the purposes of this section, "governing documents" shall
include, but are not limited to, the conditions, covenants, and
restrictions of the common interest development, and the bylaws,
rules, and regulations of the association.
   (e) This section shall become operative on January 1, 2001, and
shall only apply to governing documents entered into, amended, or
otherwise modified on or after that date.



1361.  Unless the declaration otherwise provides:
   (a) In a community apartment project and condominium project, and
in those planned developments with common areas owned in common by
the owners of the separate interests, there are appurtenant to each
separate interest nonexclusive rights of ingress, egress, and
support, if necessary, through the common areas.  The common areas
are subject to these rights.
   (b) In a stock cooperative, and in a planned development with
common areas owned by the association, there is an easement for
ingress, egress, and support, if necessary, appurtenant to each
separate interest.  The common areas are subject to these easements.



1361.5.  Except as otherwise provided in law, an order of the court,
or an order pursuant to a final and binding arbitration decision, an
association may not deny an owner or occupant physical access to his
or her separate interest, either by restricting access through the
common areas to the owner's separate interest, or by restricting
access solely to the owner's separate interest.



1362.  Unless the declaration otherwise provides, in a condominium
project, or in a planned development in which the common areas are
owned by the owners of the separate interests, the common areas are
owned as tenants in common, in equal shares, one for each unit or
lot.



1363.  (a) A common interest development shall be managed by an
association which may be incorporated or unincorporated.  The
association may be referred to as a community association.
   (b) An association, whether incorporated or unincorporated, shall
prepare a budget pursuant to Section 1365 and disclose information,
if requested, in accordance with Section 1368.
   (c) Unless the governing documents provide otherwise, and
regardless of whether the association is incorporated or
unincorporated, the association may exercise the powers granted to a
nonprofit mutual benefit corporation, as enumerated in Section 7140
of the Corporations Code, except that an unincorporated association
may not adopt or use a corporate seal or issue membership
certificates in accordance with Section 7313 of the Corporations
Code.
   The association, whether incorporated or unincorporated, may
exercise the powers granted to an association by Section 383 of the
Code of Civil Procedure and the powers granted to the association in
this title.
   (d) Meetings of the membership of the association shall be
conducted in accordance with a recognized system of parliamentary
procedure or any parliamentary procedures the association may adopt.

   (e) Notwithstanding any other provision of law, notice of meetings
of the members shall specify those matters the board intends to
present for action by the members, but, except as otherwise provided
by law, any proper matter may be presented at the meeting for action.

   (f) Members of the association shall have access to association
records in accordance with Article 3 (commencing with Section 8330)
of Chapter 13 of Part 3 of Division 2 of Title 1 of the Corporations
Code.
   (g) If an association adopts or has adopted a policy imposing any
monetary penalty, including any fee, on any association member for a
violation of the governing documents or rules of the association,
including any monetary penalty relating to the activities of a guest
or invitee of a member, the board of directors shall adopt and
distribute to each member, by personal delivery or first-class mail,
a schedule of the monetary penalties that may be assessed for those
violations, which shall be in accordance with authorization for
member discipline contained in the governing documents.  The board of
directors shall not be required to distribute any additional
schedules of monetary penalties unless there are changes from the
schedule that was adopted and distributed to the members pursuant to
this subdivision.
   (h) When the board of directors is to meet to consider or impose
discipline upon a member, the board shall notify the member in
writing, by either personal delivery or first-class mail, at least 10
days prior to the meeting.  The notification shall contain, at a
minimum, the date, time, and place of the meeting, the nature of the
alleged violation for which a member may be disciplined, and a
statement that the member has a right to attend and may address the
board at the meeting.  The board of directors of the association
shall meet in executive session if requested by the member being
disciplined.
   If the board imposes discipline on a member, the board shall
provide the member a written notification of the disciplinary action,
by either personal delivery or first-class mail, within 15 days
following the action.  A disciplinary action shall not be effective
against a member unless the board fulfills the requirements of this
subdivision.
   (i) Whenever two or more associations have consolidated any of
their functions under a joint neighborhood association or similar
organization, members of each participating association shall be
entitled to attend all meetings of the joint association other than
executive sessions, (1) shall be given reasonable opportunity for
participation in those meetings and (2) shall be entitled to the same
access to the joint association's records as they are to the
participating association's records.
   (j) Nothing in this section shall be construed to create, expand,
or reduce the authority of the board of directors of an association
to impose monetary penalties on an association member for a violation
of the governing documents or rules of the association.



1363.05.  (a) This section shall be known and may be cited as the
Common Interest Development Open Meeting Act.
   (b) Any member of the association may attend meetings of the board
of directors of the association, except when the board adjourns to
executive session to consider litigation, matters relating to the
formation of contracts with third parties, member discipline,
personnel matters, or to meet with a member, upon the member's
request, regarding the member's payment of assessments, as specified
in Section 1367 or 1367.1.  The board of directors of the association
shall meet in executive session, if requested by a member who may be
subject to a fine, penalty, or other form of discipline, and the
member shall be entitled to attend the executive session.
   (c) Any matter discussed in executive session shall be generally
noted in the minutes of the immediately following meeting that is
open to the entire membership.
   (d) The minutes, minutes proposed for adoption that are marked to
indicate draft status, or a summary of the minutes, of any meeting of
the board of directors of an association, other than an executive
session, shall be available to members within 30 days of the meeting.
  The minutes, proposed minutes, or summary minutes shall be
distributed to any member of the association upon request and upon
reimbursement of the association's costs for making that
distribution.
   (e) Members of the association shall be notified in writing at the
time that the pro forma budget required in Section 1365 is
distributed, or at the time of any general mailing to the entire
membership of the association, of their right to have copies of the
minutes of meetings of the board of directors, and how and where
those minutes may be obtained.
   (f) As used in this section, "meeting" includes any congregation
of a majority of the members of the board at the same time and place
to hear, discuss, or deliberate upon any item of business scheduled
to be heard by the board, except those matters that may be discussed
in executive session.
   (g) Unless the time and place of meeting is fixed by the bylaws,
or unless the bylaws provide for a longer period of notice, members
shall be given notice of the time and place of a meeting as defined
in subdivision (f), except for an emergency meeting, at least four
days prior to the meeting.  Notice shall be given by posting the
notice in a prominent place or places within the common area and by
mail to any owner who had requested notification of board meetings by
mail, at the address requested by the owner.  Notice may also be
given, by mail or delivery of the notice to each unit in the
development or by newsletter or similar means of communication.
   (h) An emergency meeting of the board may be called by the
president of the association, or by any two members of the governing
body other than the president, if there are circumstances that could
not have been reasonably foreseen which require immediate attention
and possible action by the board, and which of necessity make it
impracticable to provide notice as required by this section.
   (i) The board of directors of the association shall permit any
member of the association to speak at any meeting of the association
or the board of directors, except for meetings of the board held in
executive session.  A reasonable time limit for all members of the
association to speak to the board of directors or before a meeting of
the association shall be established by the board of directors.




1363.1.  (a) A prospective managing agent of a common interest
development shall provide a written statement to the board of
directors of the association of a common interest development as soon
as practicable, but in no event more than 90 days, before entering
into a management agreement which shall contain all of the following
information concerning the managing agent:
   (1) The names and business addresses of the owners or general
partners of the managing agent.  If the managing agent is a
corporation, the written statement shall include the names and
business addresses of the directors and officers and shareholders
holding greater than 10 percent of the shares of the corporation.
   (2) Whether or not any relevant licenses such as architectural
design, construction, engineering, real estate, or accounting have
been issued by this state and are currently held by the persons
specified in paragraph (1).  If a license is currently held by any of
those persons, the statement shall contain the following
information:
   (A) What license is held.
   (B) The dates the license is valid.
   (C) The name of the licensee appearing on that license.
   (3) Whether or not any relevant professional certifications or
designations such as architectural design, construction, engineering,
real property management, or accounting are currently held by any of
the persons specified in paragraph (1), including, but not limited
to, a professional common interest development manager.  If any
certification or designation is held, the statement shall include the
following information:
   (A) What the certification or designation is and what entity
issued it.
   (B) The dates the certification or designation is valid.
   (C) The names in which the certification or designation is held.
   (b) As used in this section, a "managing agent" is a person or
entity who, for compensation or in expectation of compensation,
exercises control over the assets of a common interest development.
A "managing agent" does not include either of the following:
   (1) A full-time employee of the association.
   (2) Any regulated financial institution operating within the
normal course of its regulated business practice.



1363.2.  (a) A managing agent of a common interest development who
accepts or receives funds belonging to the association shall deposit
all such funds that are not placed into an escrow account with a
bank, savings association, or credit union or into an account under
the control of the association, into a trust fund account maintained
by the managing agent in a bank, savings association, or credit union
in this state.  All funds deposited by the managing agent in the
trust fund account shall be kept in this state in a financial
institution, as defined in Section 31041 of the Financial Code, which
is insured by the federal government, and shall be maintained there
until disbursed in accordance with written instructions from the
association entitled to the funds.
   (b) At the written request of the board of directors of the
association, the funds the managing agent accepts or receives on
behalf of the association shall be deposited into an interest-bearing
account in a bank, savings association, or credit union in this
state, provided all of the following requirements are met:
   (1) The account is in the name of the managing agent as trustee
for the association or in the name of the association.
   (2) All of the funds in the account are covered by insurance
provided by an agency of the federal government.
   (3) The funds in the account are kept separate, distinct, and
apart from the funds belonging to the managing agent or to any other
person or entity for whom the managing agent holds funds in trust
except that the funds of various associations may be commingled as
permitted pursuant to subdivision (d).
   (4) The managing agent discloses to the board of directors of the
association the nature of the account, how interest will be
calculated and paid, whether service charges will be paid to the
depository and by whom, and any notice requirements or penalties for
withdrawal of funds from the account.
   (5) No interest earned on funds in the account shall inure
directly or indirectly to the benefit of the managing agent or his or
her employees.
   (c) The managing agent shall maintain a separate record of the
receipt and disposition of all funds described in this section,
including any interest earned on the funds.
   (d) The managing agent shall not commingle the funds of the
association with his or her own money or with the money of others
that he or she receives or accepts, unless all of the following
requirements are met:
   (1) The managing agent commingled the funds of various
associations on or before February 26, 1990, and has obtained a
written agreement with the board of directors of each association
that he or she will maintain a fidelity and surety bond in an amount
that provides adequate protection to the associations as agreed upon
by the managing agent and the board of directors of each association.

   (2) The managing agent discloses in the written agreement whether
he or she is deriving benefits from the commingled account or the
bank, credit union, or savings institution where the moneys will be
on deposit.
   (3) The written agreement provided pursuant to this subdivision
includes, but is not limited to, the name and address of the bonding
companies, the amount of the bonds, and the expiration dates of the
bonds.
   (4) If there are any changes in the bond coverage or the companies
providing the coverage, the managing agent discloses that fact to
the board of directors of each affected association as soon as
practical, but in no event more than 10 days after the change.
   (5) The bonds assure the protection of the association and provide
the association at least 10 days' notice prior to cancellation.
   (6) Completed payments on the behalf of the association are
deposited within 24 hours or the next business day and do not remain
commingled for more than 10 calendar days.
   (e) The prevailing party in an action to enforce this section
shall be entitled to recover reasonable legal fees and court costs.
   (f) As used in this section, a "managing agent" is a person or
entity, who for compensation or, in expectation of compensation,
exercises control over the assets of the association.  However, a
"managing agent" does not include a full-time employee of the
association or a regulated financial institution operating within the
normal course of business, or an attorney at law acting within the
scope of his or her license.
   (g) As used in this section, "completed payment" means funds
received which clearly identify the account to which the funds are to
be credited.



1363.5.  (a) The articles of incorporation of any common interest
development association filed with the Secretary of State on or after
January 1, 1995, shall include a statement that shall be in addition
to the statement of purposes of the corporation, and that (1)
identifies the corporation as an association formed to manage a
common interest development under the Davis-Stirling Common Interest
Development Act, (2) states the business or corporate office of the
association, if any, and, if the office is not on the site of the
common interest development, states the nine-digit ZIP Code, front
street, and nearest cross street for the physical location of the
common interest development, and (3) states the name and address of
the association's managing agent, as defined in Section 1363.1, if
any, and whether the association's managing agent is certified
pursuant to Section 11502 of the Business and Professions Code.
   (b) The statement of principal business activity contained in the
annual statement filed by an incorporated association with the
Secretary of State pursuant to Section 1502 of the Corporations Code
shall also contain the statement specified in subdivision (a).



1363.6.  (a) To assist with the identification of common interest
developments, each association, whether incorporated or
unincorporated, shall submit to the Secretary of State, on a form and
for a fee not to exceed thirty dollars ($30) that the Secretary of
State shall prescribe, the following information concerning the
association and the development that it manages:
   (1) A statement that the association is formed to manage a common
interest development under the Davis-Stirling Common Interest
Development Act.
   (2) The name of the association.
   (3) The street address of the association's onsite office, or, if
none, of the responsible officer or managing agent of the
association.
   (4) The address and either the daytime telephone number or e-mail
address of the president of the association, other than the address,
telephone number, or e-mail address of the association's onsite
office or managing agent of the association.
   (5) The name, street address, and daytime telephone number of the
association's managing agent, if any.
   (6) The county, and if in an incorporated area, the city in which
the development is physically located.  If the boundaries of the
development are physically located in more than one county, each of
the counties in which it is located.
   (7) If the development is in an unincorporated area, the city
closest in proximity to the development.
   (8) The nine-digit ZIP Code, front street, and nearest cross
street of the physical location of the development.
   (9) The type of common interest development, as defined in
subdivision (c) of Section 1351, managed by the association.
   (10) The number of separate interests, as defined in subdivision
(l) of Section 1351, in the development.
   (b) The association shall submit the information required by this
section as follows:
   (1) By incorporated associations, within 90 days after the filing
of its original articles of incorporation, and thereafter at the time
the association files its biennial statement of principle business
activity with the Secretary of State pursuant to Section 8210 of the
Corporations Code.
   (2) By unincorporated associations, in July of 2003, and in that
same month biennially thereafter.  Upon changing its status to that
of a corporation, the association shall comply with the filing
deadlines in paragraph (1).
   (c) The association shall notify the Secretary of State of any
change in the street address of the association's onsite office or of
the responsible officer or managing agent of the association in the
form and for a fee prescribed by the Secretary of State, within 60
days of the change.
   (d) On and after January 1, 2006, the penalty for an incorporated
association's noncompliance with the initial or biennial filing
requirements of this section shall be suspension of the association's
rights, privileges, and powers as a corporation and monetary
penalties, to the same extent and in the same manner as suspension
and monetary penalties imposed pursuant to Section 8810 of the
Corporations Code.
   (e) The Secretary of State shall make the information submitted
pursuant to paragraph (4) of subdivision (a) available only for
governmental purposes and only to members of the Legislature and the
Business, Transportation and Housing Agency, upon written request.
All other information submitted pursuant to this section shall be
subject to public inspection pursuant to the California Public
Records Act, Chapter 3.5 (commencing with Section 6250) of Division 7
of Title 1 of the Government Code.  The information submitted
pursuant to this section shall be made available for governmental or
public inspection, as the case may be, on or before July 1, 2004, and
thereafter.



1364.  (a) Unless otherwise provided in the declaration of a common
interest development, the association is responsible for repairing,
replacing, or maintaining the common areas, other than exclusive use
common areas, and the owner of each separate interest is responsible
for maintaining that separate interest and any exclusive use common
area appurtenant to the separate interest.
   (b) (1) In a community apartment project, condominium project, or
stock cooperative, as defined in Section 1351, unless otherwise
provided in the declaration, the association is responsible for the
repair and maintenance of the common area occasioned by the presence
of wood-destroying pests or organisms.
   (2) In a planned development as defined in Section 1351, unless a
different maintenance scheme is provided in the declaration, each
owner of a separate interest is responsible for the repair and
maintenance of that separate interest as may be occasioned by the
presence of wood-destroying pests or organisms.  Upon approval of the
majority of all members of the association, the responsibility for
such repair and maintenance may be delegated to the association,
which shall be entitled to recover the cost thereof as a special
assessment.
   (c) The costs of temporary relocation during the repair and
maintenance of the areas within the responsibility of the association
shall be borne by the owner of the separate interest affected.
   (d) (1) The association may cause the temporary, summary removal
of any occupant of a common interest development for such periods and
at such times as may be necessary for prompt, effective treatment of
wood-destroying pests or organisms.
   (2) The association shall give notice of the need to temporarily
vacate a separate interest to the occupants and to the owners, not
less than 15 days nor more than 30 days prior to the date of the
temporary relocation.  The notice shall state the reason for the
temporary relocation, the date and time of the beginning of
treatment, the anticipated date and time of termination of treatment,
and that the occupants will be responsible for their own
accommodations during the temporary relocation.
   (3) Notice by the association shall be deemed complete upon
either:
   (A) Personal delivery of a copy of the notice to the occupants,
and sending a  copy of the notice to the owners, if different than
the occupants, by first-class mail, postage prepaid at the most
current address shown on the books of the association.
   (B) By sending a copy of the notice to the occupants at the
separate interest address and a copy of the notice to the owners, if
different than the occupants, by first-class mail, postage prepaid,
at the most current address shown on the books of the association.
   (e) For purposes of this section, "occupant" means an owner,
resident, guest, invitee, tenant, lessee, sublessee, or other person
in possession on the separate interest.
   (f) Notwithstanding the provisions of the declaration, the owner
of a separate interest is entitled to reasonable access to the common
areas for the purpose of maintaining the internal and external
telephone wiring made part of the exclusive use common areas of a
separate interest pursuant to paragraph (2) of subdivision (i) of
Section 1351.  The access shall be subject to the consent of the
association, whose approval shall not be unreasonably withheld, and
which may include the association's approval of telephone wiring upon
the exterior of the common areas, and other conditions as the
association determines reasonable.


1365.  Unless the governing documents impose more stringent
standards, the association shall prepare and distribute to all of its
members the following documents:
   (a) A pro forma operating budget, which shall include all of the
following:
   (1) The estimated revenue and expenses on an accrual basis.
   (2) A summary of the association's reserves based upon the most
recent review or study conducted pursuant to Section 1365.5, which
shall be printed in boldface type and include all of the following:
   (A) The current estimated replacement cost, estimated remaining
life, and estimated useful life of each major component.
   (B) As of the end of the fiscal year for which the study is
prepared:
   (i) The current estimate of the amount of cash reserves necessary
to repair, replace, restore, or maintain the major components.
   (ii) The current amount of accumulated cash reserves actually set
aside to repair, replace, restore, or maintain major components.
   (iii) If applicable, the amount of funds received from either a
compensatory damage award or settlement to an association from any
person or entity for injuries to property, real or personal, arising
out of any construction or design defects, and the expenditure or
disposition of funds, including the amounts expended for the direct
and indirect costs of repair of construction or design defects.
These amounts shall be reported at the end of the fiscal year for
which the study is prepared as separate line items under cash
reserves pursuant to clause (ii).  In lieu of complying with the
requirements set forth in this clause, an association that is
obligated to issue a review of their financial statement pursuant to
subdivision (b) may include in the review a statement containing all
of the information required by this clause.
   (C) The percentage that the amount determined for purposes of
clause (ii) subparagraph (B) equals the amount determined for
purposes of clause (i) of subparagraph (B).
   (3) A statement as to whether the board of directors of the
association has determined or anticipates that the levy of one or
more special assessments will be required to repair, replace, or
restore any major component or to provide adequate reserves therefor.

   (4) A general statement addressing the procedures used for the
calculation and establishment of those reserves to defray the future
repair, replacement, or additions to those major components that the
association is obligated to maintain.
   The summary of the association's reserves disclosed pursuant to
paragraph (2) shall not be admissible in evidence to show improper
financial management of an association, provided that other relevant
and competent evidence of the financial condition of the association
is not made inadmissible by this provision.
   A copy of the operating budget shall be annually distributed not
less than 45 days nor more than 60 days prior to the beginning of the
association's fiscal year.
   (b) A review of the financial statement of the association shall
be prepared in accordance with generally accepted accounting
principles by a licensee of the California Board of Accountancy for
any fiscal year in which the gross income to the association exceeds
seventy-five thousand dollars ($75,000).  A copy of the review of the
financial statement shall be distributed within 120 days after the
close of each fiscal year.
   (c) In lieu of the distribution of the pro forma operating budget
required by subdivision (a), the board of directors may elect to
distribute a summary of the pro forma operating budget to all of its
members with a written notice that the pro forma operating budget is
available at the business office of the association or at another
suitable location within the boundaries of the development, and that
copies will be provided upon request and at the expense of the
association.  If any member requests that a copy of the pro forma
operating budget required by subdivision (a) be mailed to the member,
the association shall provide the copy to the member by first-class
United States mail at the expense of the association and delivered
within five days.  The written notice that is distributed to each of
the association members shall be in at least 10-point boldface type
on the front page of the summary of the budget.
   (d) A statement describing the association's policies and
practices in enforcing lien rights or other legal remedies for
default in payment of its assessments against its members shall be
annually delivered to the members during the 60-day period
immediately preceding the beginning of the association's fiscal year.

   (e) (1) A summary of the association's property, general
liability, and earthquake and flood and fidelity insurance policies,
which shall be distributed within 60 days preceding the beginning of
the association's fiscal year, that includes all of the following
information about each policy:
   (A) The name of the insurer.
   (B) The type of insurance.
   (C) The policy limits of the insurance.
   (D) The amount of deductibles, if any.
   (2) The association shall, as soon as reasonably practicable,
notify its members by first-class mail if any of the policies
described in paragraph (1) have lapsed, been canceled, and are not
immediately renewed, restored, or replaced, or if there is a
significant change, such as a reduction in coverage or limits or an
increase in the deductible, as to any of those policies.  If the
association receives any notice of nonrenewal of a policy described
in paragraph (1), the association shall immediately notify its
members if replacement coverage will not be in effect by the date the
existing coverage will lapse.
   (3) To the extent that any of the information required to be
disclosed pursuant to paragraph (1) is specified in the insurance
policy declaration page, the association may meet its obligation to
disclose that information by making copies of that page and
distributing it to all of its members.
   (4) The summary distributed pursuant to paragraph (1) shall
contain, in at least 10-point boldface type, the following statement:
  "This summary of the association's policies of insurance provides
only certain information, as required by subdivision (e) of Section
1365 of the Civil Code, and should not be considered a substitute for
the complete policy terms and conditions contained in the actual
policies of insurance.  Any association member may, upon request and
provision of reasonable notice, review the association's insurance
policies and, upon request and payment of reasonable duplication
charges, obtain copies of those policies.  Although the association
maintains the policies of insurance specified in this summary, the
association's policies of insurance may not cover your property,
including personal property or, real property improvements to or
around your dwelling, or personal injuries or other losses that occur
within or around your dwelling.  Even if a loss is covered, you may
nevertheless be responsible for paying all or a portion of any
deductible that applies.  Association members should consult with
their individual insurance broker or agent for appropriate additional
coverage."


1365.1.  (a) The association shall distribute the written notice
described in subdivision (b) to each member of the association during
the 60-day period immediately preceding the beginning of the
association's fiscal year.  The notice shall be printed in at least
12-point type.  An association distributing the notice to an owner of
an interest that is described in Section 11003.5 of the Business and
Professions Code may delete from the notice described in subdivision
(b) the portion regarding meetings and payment plans.
   (b) The notice required by this section shall read as follows:

      "NOTICE
      ASSESSMENTS AND FORECLOSURE

   This notice outlines some of the rights and responsibilities of
owners of property in common interest developments and the
associations that manage them.  Please refer to the sections of the
Civil Code indicated for further information.  A portion of the
information in this notice applies only to liens recorded on or after
January 1, 2003.  You may wish to consult a lawyer if you dispute an
assessment.

      ASSESSMENTS AND NONJUDICIAL FORECLOSURE

   The failure to pay association assessments may result in the loss
of an owner's property without court action, often referred to as
nonjudicial foreclosure.  When using nonjudicial foreclosure, the
association records a lien on the owner's property.  The owner's
property may be sold to satisfy the lien if the lien is not paid.
Assessments become delinquent 15 days after they are due, unless the
governing documents of the association provide for a longer time.
(Sections 1366 and 1367.1 of the Civil Code)
   In a nonjudicial foreclosure, the association may recover
assessments, reasonable costs of collection, reasonable attorney's
fees, late charges, and interest.  The association may not use
nonjudicial foreclosure to collect fines or penalties, except for
costs to repair common areas damaged by a member or a member's
guests, if the governing documents provide for this.  (Sections 1366
and 1367.1 of the Civil Code)
   The association must comply with the requirements of Section
1367.1 of the Civil Code when collecting delinquent assessments.  If
the association fails to follow these requirements, it may not record
a lien on the owner's property until it has satisfied those
requirements.  Any additional costs that result from satisfying the
requirements are the responsibility of the association.  (Section
1367.1 of the Civil Code)
   At least 30 days prior to recording a lien on an owner's separate
interest, the association must provide the owner of record with
certain documents by certified mail.  Among these documents, the
association must send a description of its collection and lien
enforcement procedures and the method of calculating the amount.  It
must also provide an itemized statement of the charges owed by the
owner.  An owner has a right to review the association's records to
verify the debt.  (Section 1367.1 of the Civil Code)
   If a lien is recorded against an owner's property in error, the
person who recorded the lien is required to record a lien release
within 21 days, and to provide an owner certain documents in this
regard.  (Section 1367.1 of the Civil Code)
   The collection practices of the association may be governed by
state and federal laws regarding fair debt collection.  Penalties can
be imposed for debt collection practices that violate these laws.

      PAYMENTS

   When an owner makes a payment, he or she may request a receipt,
and the association is required to provide it.  On the receipt, the
association must indicate the date of payment and the person who
received it.  The association must inform owners of a mailing address
for overnight payments.  (Sections 1367.1 and 1367.1 of the Civil
Code)
   An owner may dispute an assessment debt by giving the board of the
association a written explanation, and the board must respond within
15 days if certain conditions are met.  An owner may pay assessments
that are in dispute in full under protest, and then request
alternative dispute resolution.  (Sections 1366.3 and 1367.1 of the
Civil Code)
   An owner is not liable for charges, interest, and costs of
collection, if it is established that the assessment was paid
properly on time.  (Section 1367.1 of the Civil Code)

      MEETINGS AND PAYMENT PLANS

   An owner of a separate interest that is not a time-share may
request the association to consider a payment plan to satisfy a
delinquent assessment.  The association must inform owners of the
standards for payment plans, if any exist.  (Section 1367.1 of the
Civil Code)
   The board of the directors must meet with an owner who makes a
proper written request for a meeting to discuss a payment plan when
the owner has received a notice of a delinquent assessment.  These
payment plans must conform with the payment plan standards of the
association, if they exist.  (Section 1367.1 of the Civil Code)"




1365.5.  (a) Unless the governing documents impose more stringent
standards, the board of directors of the association shall do all of
the following:
   (1) Review a current reconciliation of the association's operating
accounts on at least a quarterly basis.
   (2) Review a current reconciliation of the association's reserve
accounts on at least a quarterly basis.
   (3) Review, on at least a quarterly basis, the current year's
actual reserve revenues and expenses compared to the current year's
budget.
   (4) Review the latest account statements prepared by the financial
institutions where the association has its operating and reserve
accounts.
   (5) Review an income and expense statement for the association's
operating and reserve accounts on at least a quarterly basis.
   (b) The signatures of at least two persons, who shall be members
of the association's board of directors, or one officer who is not a
member of the board of directors and a member of the board of
directors, shall be required for the withdrawal of moneys from the
association's reserve accounts.
   (c) (1) The board of directors shall not expend funds designated
as reserve funds for any purpose other than the repair, restoration,
replacement, or maintenance of, or litigation involving the repair,
restoration, replacement, or maintenance of, major components which
the association is obligated to repair, restore, replace, or maintain
and for which the reserve fund was established.
   (2) However, the board may authorize the temporary transfer of
money from a reserve fund to the association's general operating fund
to meet short-term cash-flow requirements or other expenses,
provided the board has made a written finding, recorded in the board'
s minutes, explaining the reasons that the transfer is needed, and
describing when and how the money will be repaid to the reserve fund.
  The transferred funds shall be restored to the reserve fund within
one year of the date of the initial transfer, except that the board
may, upon making a finding supported by documentation that a
temporary delay would be in the best interests of the common interest
development, temporarily delay the restoration.  The board shall
exercise prudent fiscal management in maintaining the integrity of
the reserve account, and shall, if necessary, levy a special
assessment to recover the full amount of the expended funds within
the time limits required by this section.  This special assessment is
subject to the limitation imposed by Section 1366.  The board may,
at its discretion, extend the date the payment on the special
assessment is due.  Any extension shall not prevent the board from
pursuing any legal remedy to enforce the collection of an unpaid
special assessment.
   (d) When the decision is made to use reserve funds or to
temporarily transfer money from the reserve fund to pay for
litigation, the association shall notify the members of the
association of that decision in the next available mailing to all
members pursuant to Section 5016 of the Corporations Code, and of the
availability of an accounting of those expenses.  Unless the
governing documents impose more stringent standards, the association
shall make an accounting of expenses related to the litigation on at
least a quarterly basis.  The accounting shall be made available for
inspection by members of the association at the association's office.

   (e) At least once every three years the board of directors shall
cause to be conducted a reasonably competent and diligent visual
inspection of the accessible areas of the major components which the
association is obligated to repair, replace, restore, or maintain as
part of a study of the reserve account requirements of the common
interest development if the current replacement value of the major
components is equal to or greater than one-half of the gross budget
of the association which excludes the association's reserve account
for that period.  The board shall review this study annually and
shall consider and implement necessary adjustments to the board's
analysis of the reserve account requirements as a result of that
review.
   The study required by this subdivision shall at a minimum include:

   (1) Identification of the major components which the association
is obligated to repair, replace, restore, or maintain which, as of
the date of the study, have a remaining useful life of less than 30
years.
   (2) Identification of the probable remaining useful life of the
components identified in paragraph (1) as of the date of the study.
   (3) An estimate of the cost of repair, replacement, restoration,
or maintenance of the components identified in paragraph (1) during
and at the end of their useful life.
   (4) An estimate of the total annual contribution necessary to
defray the cost to repair, replace, restore, or maintain the
components identified in paragraph (1) during and at the end of their
useful life, after subtracting total reserve funds as of the date of
the study.
   (f) As used in this section, "reserve accounts" means both of the
following:
   (1) Moneys that the association's board of directors has
identified for use to defray the future repair or replacement of, or
additions to, those major components which the association is
obligated to maintain.
   (2) The funds received and not yet expended or disposed from
either a compensatory damage award or settlement to an association
from any person or entity for injuries to property, real or personal,
arising from any construction or design defects.  These funds shall
be separately itemized from funds described in paragraph (1).
   (g) As used in this section, "reserve account requirements" means
the estimated funds which the association's board of directors has
determined are required to be available at a specified point in time
to repair, replace, or restore those major components which the
association is obligated to maintain.
   (h) This section does not apply to an association that does not
have a "common area" as defined in Section 1351.



1365.7.  (a) A volunteer officer or volunteer director of an
association, as defined in subdivision (a) of Section 1351, which
manages a common interest development that is exclusively
residential, shall not be personally liable in excess of the coverage
of insurance specified in paragraph (4) to any person who suffers
injury, including, but not limited to, bodily injury, emotional
distress, wrongful death, or property damage or loss as a result of
the tortious act or omission of the volunteer officer or volunteer
director if all of the following criteria are met:
   (1) The act or omission was performed within the scope of the
officer's or director's association duties.
   (2) The act or omission was performed in good faith.
   (3) The act or omission was not willful, wanton, or grossly
negligent.
   (4) The association maintained and had in effect at the time the
act or omission occurred and at the time a claim is made one or more
policies of insurance which shall include coverage for (A) general
liability of the association and (B) individual liability of officers
and directors of the association for negligent acts or omissions in
that capacity; provided, that both types of coverage are in the
following minimum amount:
   (A) At least five hundred thousand dollars ($500,000) if the
common interest development consists of 100 or fewer separate
interests.
   (B) At least one million dollars ($1,000,000) if the common
interest development consists of more than 100 separate interests.
   (b) The payment of actual expenses incurred by a director or
officer in the execution of the duties of that position does not
affect the director's or officer's status as a volunteer within the
meaning of this section.
   (c) An officer or director who at the time of the act or omission
was a declarant, as defined in subdivision (g) of Section 1351, or
who received either direct or indirect compensation as an employee
from the declarant, or from a financial institution that purchased a
separate interest, as defined in subdivision (l) of Section 1351, at
a judicial or nonjudicial foreclosure of a mortgage or deed of trust
on real property, is not a volunteer for the purposes of this
section.
   (d) Nothing in this section shall be construed to limit the
liability of the association for its negligent act or omission or for
any negligent act or omission of an officer or director of the
association.
   (e) This section shall only apply to a volunteer officer or
director who is a tenant of a separate interest in the common
interest development or is an owner of no more than two separate
interests in the common interest development.
   (f) (1) For purposes of paragraph (1) of subdivision (a), the
scope of the officer's or director's association duties shall
include, but shall not be limited to, both of the following
decisions:
   (A) Whether to conduct an investigation of the common interest
development for latent deficiencies prior to the expiration of the
applicable statute of limitations.
   (B) Whether to commence a civil action against the builder for
defects in design or construction.
   (2) It is the intent of the Legislature that this section clarify
the scope of association duties to which the protections against
personal liability in this section apply.  It is not the intent of
the Legislature that these clarifications be construed to expand, or
limit, the fiduciary duties owed by the directors or officers.



1365.9.  (a) It is the intent of the Legislature to offer civil
liability protection to owners of the separate interests in a common
interest development that have common areas owned in
tenancy-in-common if the association carries a certain level of
prescribed insurance that covers a cause of action in tort.
   (b) Any cause of action in tort against any owner of a separate
interest arising solely by reason of an ownership interest as a
tenant in common in the common area of a common interest development
shall be brought only against the association and not against the
individual owners of the separate interests, as defined in
subdivision (l) of Section 1351,  if both of the insurance
requirements in paragraphs (1) and (2) are met:
   (1) The association maintained and has in effect  for this cause
of action, one or more policies of insurance which include coverage
for general liability of the association.
   (2) The coverage described in paragraph (1) is in the following
minimum amounts:
   (A) At least two million dollars ($2,000,000) if the common
interest development consists of 100 or fewer separate interests.
   (B) At least three million dollars ($3,000,000) if the common
interest development consists of more than 100 separate interests.



1366.  (a) Except as provided in this section, the association shall
levy regular and special assessments sufficient to perform its
obligations under the governing documents and this title.  However,
annual increases in regular assessments for any fiscal year, as
authorized by subdivision (b), shall not be imposed unless the board
has complied with subdivision (a) of Section 1365 with respect to
that fiscal year, or has obtained the approval of owners,
constituting a quorum, casting a majority of the votes at a meeting
or election of the association conducted in accordance with Chapter 5
(commencing with Section 7510) of Part 3 of Division 2 of Title 1 of
the Corporations Code and Section 7613 of the Corporations Code.
For the purposes of this section, "quorum" means more than 50 percent
of the owners of an association.
   (b) Notwithstanding more restrictive limitations placed on the
board by the governing documents, the board of directors may not
impose a regular assessment that is more than 20 percent greater than
the regular assessment for the association's preceding fiscal year
or impose special assessments which in the aggregate exceed 5 percent
of the budgeted gross expenses of the association for that fiscal
year without the approval of owners, constituting a quorum, casting a
majority of the votes at a meeting or election of the association
conducted in accordance with Chapter 5 (commencing with Section 7510)
of Part 3 of Division 2 of Title 1 of the Corporations Code and
Section 7613 of the Corporations Code.  For the purposes of this
section, quorum means more than 50 percent of the owners of an
association.  This section does not limit assessment increases
necessary for emergency situations.  For purposes of this section, an
emergency situation is any one of the following:
   (1) An extraordinary expense required by an order of a court.
   (2) An extraordinary expense necessary to repair or maintain the
common interest development or any part of it for which the
association is responsible where a threat to personal safety on the
property is discovered.
   (3) An extraordinary expense necessary to repair or maintain the
common interest development or any part of it for which the
association is responsible that could not have been reasonably
foreseen by the board in preparing and distributing the pro forma
operating budget under Section 1365.  However, prior to the
imposition or collection of an assessment under this subdivision, the
board shall pass a resolution containing written findings as to the
necessity of the extraordinary expense involved and why the expense
was not or could not have been reasonably foreseen in the budgeting
process, and the resolution shall be distributed to the members with
the notice of assessment.
   (c) Regular assessments imposed or collected to perform the
obligations of an association under the governing documents or this
title shall be exempt from execution by a judgment creditor of the
association only to the extent necessary for the association to
perform essential services, such as paying for utilities and
insurance.  In determining the appropriateness of an exemption, a
court shall ensure that only essential services are protected under
this subdivision.
   This exemption shall not apply to any consensual pledges, liens,
or encumbrances that have been approved by the owners of an
association, constituting a quorum, casting a majority of the votes
at a meeting or election of the association, or to any state tax
lien, or to any lien for labor or materials supplied to the common
area.
   (d) The association shall provide notice by first-class mail to
the owners of the separate interests of any increase in the regular
or special assessments of the association, not less than 30 nor more
than 60 days prior to the increased assessment becoming due.
   (e) Regular and special assessments levied pursuant to the
governing documents are delinquent 15 days after they become due,
unless the declaration provides a longer time period, in which case
the longer time period shall apply.  If an assessment is delinquent
the association may recover all of the following:
   (1) Reasonable costs incurred in collecting the delinquent
assessment, including reasonable attorney's fees.
   (2) A late charge not exceeding 10 percent of the delinquent
assessment or ten dollars ($10), whichever is greater, unless the
declaration specifies a late charge in a smaller amount, in which
case any late charge imposed shall not exceed the amount specified in
the declaration.
   (3) Interest on all sums imposed in accordance with this section,
including the delinquent assessments, reasonable fees and costs of
collection, and reasonable attorney's fees, at an annual interest
rate not to exceed 12 percent, commencing 30 days after the
assessment becomes due, unless the declaration specifies the recovery
of interest at a rate of a lesser amount, in which case the lesser
rate of interest shall apply.
   (f) Associations are hereby exempted from interest-rate
limitations imposed by Article XV of the California Constitution,
subject to the limitations of this section.



1366.1.  An association shall not impose or collect an assessment or
fee that exceeds the amount necessary to defray the costs for which
it is levied.


1366.2.  (a) In order to facilitate the collection of regular
assessments, special assessments, transfer fees, and similar charges,
the board of directors of any association is authorized to record a
statement or amended statement identifying relevant information for
the association.  This statement may include any or all of the
following information:
   (1) The name of the association as shown in the conditions,
covenants, and restrictions or the current name of the association,
if different.
   (2) The name and address of a managing agent or treasurer of the
association or other individual or entity authorized to receive
assessments and fees imposed by the association.
   (3) A daytime telephone number of the authorized party identified
in paragraph (2) if a telephone number is available.
   (4) A list of separate interests subject to assessment by the
association, showing the assessor's parcel number or legal
description, or both, of the separate interests.
   (5) The recording information identifying the declaration or
declarations of covenants, conditions, and restrictions governing the
association.
   (6) If an amended statement is being recorded, the recording
information identifying the prior statement or statements which the
amendment is superseding.
   (b) The county recorder is authorized to charge a fee for
recording the document described in subdivision (a), which fee shall
be based upon the number of pages in the document and the recorder's
per-page recording fee.


1366.3.  (a) The exception for disputes related to association
assessments in subdivision (b) of Section 1354 shall not apply if, in
a dispute between the owner of a separate interest and the
association regarding the assessments imposed by the association, the
owner of the separate interest chooses to pay in full to the
association all of the charges listed in paragraphs (1) to (4),
inclusive, and states by written notice that the amount is paid under
protest, and the written notice is mailed by certified mail not more
than 30 days from the recording of a notice of delinquent assessment
in accordance with Section 1367 or 1367.1; and in those instances,
the association shall inform the owner that the owner may resolve the
dispute through alternative dispute resolution as set forth in
Section 1354, civil action, and any other procedures to resolve the
dispute that may be available through the association.
   (1) The amount of the assessment in dispute.
   (2) Late charges.
   (3) Interest.
   (4) All reasonable fees and costs associated with the preparation
and filing of a notice of delinquent assessment, including all
mailing costs, and including reasonable attorney's fees not to exceed
four hundred twenty-five dollars ($425).
   (b) The right of any owner of a separate interest to utilize
alternative dispute resolution under this section may not be
exercised more than two times in any single calendar year, and not
more than three times within any five calendar years.  Nothing within
this section shall preclude any owner of a separate interest and the
association, upon mutual agreement, from entering into alternative
dispute resolution for a number of times in excess of the limits set
forth in this section.  The owner of a separate interest may request
and be awarded through alternative dispute resolution reasonable
interest to be paid by the association on the total amount paid under
paragraphs (1) to (4), inclusive, of subdivision (a), if it is
determined through alternative dispute resolution that the assessment
levied by the association was not correctly levied.



1367.  (a) A regular or special assessment and any late charges,
reasonable costs of collection, and interest, as assessed in
accordance with Section 1366, shall be a debt of the owner of the
separate interest at the time the assessment or other sums are
levied.  Before an association may place a lien upon the separate
interest of an owner to collect a debt which is past due under this
subdivision, the association shall notify the owner in writing by
certified mail of the fee and penalty procedures of the association,
provide an itemized statement of the charges owed by the owner,
including items on the statement which indicate the assessments owed,
any late charges and the method of calculation, any attorney's fees,
and the collection practices used by the association, including the
right of the association to the reasonable costs of collection.  In
addition, any payments toward that debt shall first be applied to the
assessments owed, and only after the principal owed is paid in full
shall the payments be applied to interest or collection expenses.
   (b) The amount of the assessment, plus any costs of collection,
late charges, and interest assessed in accordance with Section 1366,
shall be a lien on the owner's interest in the common interest
development from and after the time the association causes to be
recorded with the county recorder of the county in which the separate
interest is located, a notice of delinquent assessment, which shall
state the amount of the assessment and other sums imposed in
accordance with Section 1366, a legal description of the owner's
interest in the common interest development against which the
assessment and other sums are levied, the name of the record owner of
the owner's interest in the common interest development against
which the lien is imposed, and, in order for the lien to be enforced
by nonjudicial foreclosure as provided in subdivision  (e) the name
and address of the trustee authorized by the association to enforce
the lien by sale.  The notice of delinquent assessment shall be
signed by the person designated in the declaration or by the
association for that purpose, or if no one is designated, by the
president of the association, and mailed in the manner set forth in
Section 2924b, to all record owners of the owner's interest in the
common interest development no later than 10 calendar days after
recordation.  Upon payment of the sums specified in the notice of
delinquent assessment, the association shall cause to be recorded a
further notice stating the satisfaction and release of the lien
thereof.  A monetary penalty imposed by the association as a means of
reimbursing the association for costs incurred by the association in
the repair of damage to common areas and facilities for which the
member or the member's guests or tenants were responsible may become
a lien against the member's separate interest enforceable by the sale
of the interest under Sections 2924, 2924b, and 2924c, provided the
authority to impose a lien is set forth in the governing documents.
It is the intent of the Legislature not to contravene Section 2792.26
of Title 10 of the California Code of Regulations, as that section
appeared on January 1, 1996, for associations of subdivisions that
are being sold under authority of a subdivision public report,
pursuant to Part 2 (commencing with Section 11000) of Division 4 of
the Business and Professions Code.
   (c) Except as indicated in subdivision (b), a monetary penalty
imposed by the association as a disciplinary measure for failure of a
member to comply with the governing instruments, except for the late
payments, may not be characterized nor treated in the governing
instruments as an assessment which may become a lien against the
member's subdivision interest enforceable by the sale of the interest
under Sections 2924, 2924b, and 2924c.
   (d) A lien created pursuant to subdivision (b) shall be prior to
all other liens recorded subsequent to the notice of assessment,
except that the declaration may provide for the subordination thereof
to any other liens and encumbrances.
   (e) After the expiration of 30 days following the recording of a
lien created pursuant to subdivision (b), the lien may be enforced in
any manner permitted by law, including sale by the court, sale by
the trustee designated in the notice of delinquent assessment, or
sale by a trustee substituted pursuant to Section 2934a.  Any sale by
the trustee shall be conducted in accordance with the provisions of
Sections 2924, 2924b, and 2924c applicable to the exercise of powers
of sale in mortgages and deeds of trusts.
   (f) Nothing in this section or in subdivision (a) of Section 726
of the Code of Civil Procedure prohibits actions against the owner of
a separate interest to recover sums for which a lien is created
pursuant to this section or prohibits an association from taking a
deed in lieu of foreclosure.
   (g) This section only applies to liens recorded on or after
January 1, 1986 and prior to January 1, 2003.



1367.1.  (a) A regular or special assessment and any late charges,
reasonable fees and costs of collection, reasonable attorney's fees,
if any, and interest, if any, as determined in accordance with
Section 1366, shall be a debt of the owner of the separate interest
at the time the assessment or other sums are levied.  At least 30
days prior to  recording a lien upon the separate interest of the
owner of record to collect a debt that is past due under this
subdivision, the association shall notify the owner of record in
writing by certified mail of the following:
   (1) A general description of the collection and lien enforcement
procedures of the association and the method of calculation of the
amount, a statement that the owner of the separate interest  has the
right to inspect the association records, pursuant to Section 8333 of
the Corporations Code, and the following statement in 14-point
boldface type, if printed, or in capital letters, if typed:
"IMPORTANT NOTICE:  IF YOUR SEPARATE INTEREST IS PLACED IN
FORECLOSURE BECAUSE YOU ARE BEHIND IN YOUR ASSESSMENTS, IT MAY BE
SOLD WITHOUT COURT ACTION".
   (2) An itemized statement of the charges owed by the owner,
including items on the statement which indicate the amount of any
delinquent assessments, the fees and reasonable costs of collection,
reasonable attorney's fees, any late charges, and interest, if any.
   (3) A statement that the owner shall not be liable to pay the
charges, interest, and costs of collection, if it is determined the
assessment was paid on time to the association.
   (4) The right to request a meeting with the board as provided by
subdivision (c).
   (b) Any payments made by the owner of a separate interest toward
the debt set forth, as required in subdivision (a), shall first be
applied to the assessments owed, and, only after the assessments owed
are paid in full shall the payments be applied to the fees and costs
of collection, attorney's fees, late charges, or interest.  When an
owner makes a payment, the owner may request a receipt and the
association shall provide it.  The receipt shall indicate the date of
payment and the person who received it.  The association shall
provide a mailing address for overnight payment of assessments.
   (c) (1) An owner may dispute the debt noticed pursuant to
subdivision (a) by submitting to the board a written explanation of
the reasons for his or her dispute.  The board shall respond in
writing to the owner within 15 days of the date of the postmark of
the explanation, if the explanation is mailed within 15 days of the
postmark of the notice.
   (2) An owner, other than an owner of any interest that is
described in Section 11003.5 of the Business and Professions Code,
may submit a written request to meet with the board to discuss a
payment plan for the debt noticed pursuant to subdivision (a).  The
association shall provide the owners the standards for payment plans,
if any exist.  The board shall meet with the owner in executive
session within 45 days of the postmark of the request, if the request
is mailed within 15 days of the date of the postmark of the notice,
unless there is no regularly scheduled board meeting within that
period, in which case the board may designate a committee of one or
more members to meet with the owner.
   (d) The amount of the assessment, plus any costs of collection,
late charges, and interest assessed in accordance with Section 1366,
shall be a lien on the owner's interest in the common interest
development from and after the time the association causes to be
recorded with the county recorder of the county in which the separate
interest is located, a notice of delinquent assessment, which shall
state the amount of the assessment and other sums imposed in
accordance with Section 1366, a legal description of the owner's
interest in the common interest development against which the
assessment and other sums are levied, the name of the record owner of
the owner's interest in the common interest development against
which the lien is imposed.  In order for the lien to be enforced by
nonjudicial foreclosure as provided in subdivision  (g), the notice
of delinquent assessment shall state the name and address of the
trustee authorized by the association to enforce the lien by sale.
The notice of delinquent assessment shall be signed by the person
designated in the declaration or by the association for that purpose,
or if no one is designated, by the president of the association, and
mailed in the manner set forth in Section 2924b, to all record
owners of the owner's interest in the common interest development no
later than 10 calendar days after recordation.  Within 21 days of the
payment of the sums specified in the notice of delinquent
assessment, the association shall record or cause to be recorded in
the office of the county recorder in which the notice of delinquent
assessment is recorded a lien release or notice of rescission and
provide the owner of the separate interest a copy of the lien release
or notice that the delinquent assessment has been satisfied.  A
monetary charge imposed by the association as a means of reimbursing
the association for costs incurred by the association in the repair
of damage to common areas and facilities for which the member or the
member's guests or tenants were responsible may become a lien against
the member's separate interest enforceable by the sale of the
interest under Sections 2924, 2924b, and 2924c, provided the
authority to impose a lien is set forth in the governing documents.
It is the intent of the Legislature not to contravene Section 2792.26
of Title 10 of the California Code of Regulations, as that section
appeared on January 1, 1996, for associations of subdivisions that
are being sold under authority of a subdivision public report,
pursuant to Part 2 (commencing with Section 11000) of Division 4 of
the Business and Professions Code.
   (e) Except as indicated in subdivision (d), a monetary penalty
imposed by the association as a disciplinary measure for failure of a
member to comply with the governing instruments, except for the late
payments, may not be characterized nor treated in the governing
instruments as an assessment that may become a lien against the
member's subdivision separate interest enforceable by the sale of the
interest under Sections 2924, 2924b, and 2924c.
   (f) A lien created pursuant to subdivision (d) shall be prior to
all other liens recorded subsequent to the notice of assessment,
except that the declaration may provide for the subordination thereof
to any other liens and encumbrances.
   (g) An association may not voluntarily assign or pledge the
association's right to collect payments or assessments, or to enforce
or foreclose a lien to a third party, except when the assignment or
pledge is made to a financial institution or lender chartered or
licensed under federal or state law, when acting within the scope of
that charter or license, as security for a loan obtained by the
association; however, the foregoing provision may not restrict the
right or ability of an association to assign any unpaid obligations
of a former member to a third party for purposes of collection.
Subject to the limitations of this subdivision, after the expiration
of 30 days following the recording of a lien created pursuant to
subdivision (d), the lien may be enforced in any manner permitted by
law, including sale by the court, sale by the trustee designated in
the notice of delinquent assessment, or sale by a trustee substituted
pursuant to Section 2934a.  Any sale by the trustee shall be
conducted in accordance with Sections 2924, 2924b, and 2924c
applicable to the exercise of powers of sale in mortgages and deeds
of trusts.  The fees of a trustee may not exceed the amounts
prescribed in Sections 2924c and 2924d.
   (h) Nothing in this section or in subdivision (a) of Section 726
of the Code of Civil Procedure prohibits actions against the owner of
a separate interest to recover sums for which a lien is created
pursuant to this section or prohibits an association from taking a
deed in lieu of foreclosure.
   (i) If it is determined that a lien previously recorded against
the separate interest was recorded in error, the party who recorded
the lien shall, within 21 calendar days, record or cause to be
recorded in the office of the county recorder in which the notice of
delinquent assessment is recorded a lien release or notice of
rescission and provide the owner of the separate interest with a
declaration that the lien filing or recording was in error and a copy
of the lien release or notice of rescission.
   (j) (1) An association that fails to comply with the procedures
set forth in this section shall, prior to recording a lien,
recommence the required notice process.
   (2) Any costs associated with recommencing the notice process
shall be borne by the association and not by the owner of a separate
interest.
   (k) This section only applies to liens recorded on or after
January 1, 2003.


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 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 preliminary 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 preliminary list of
defects pursuant to this paragraph shall not waive any privilege
attached to the document.  The preliminary 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.
   (b) Upon written request, an association shall, within 10 days of
the mailing or delivery of the request, provide the owner of a
separate interest with a copy of the requested items specified in
paragraphs (1) to (8), inclusive, of subdivision (a).  The
association may charge a fee for this service, which shall not exceed
the association's reasonable cost to prepare and reproduce the
requested items.
   (c) An association shall not impose or collect any assessment,
penalty, or fee in connection with a transfer of title or any other
interest except the association's actual costs to change its records
and that authorized by subdivision (b).
   (d) Any person or entity who willfully violates this section shall
be liable to the purchaser of a separate interest which 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.



1368.1.  (a) Any rule or regulation of an association that
arbitrarily or unreasonably restricts an owner's ability to market
his or her interest in a common interest development is void.
   (b) No association may adopt, enforce, or otherwise impose any
rule or regulation that does either of the following:
   (1) Imposes an assessment or fee in connection with the marketing
of an owner's interest in an amount that exceeds the association's
actual or direct costs.  That assessment or fee shall be deemed to
violate the limitation set forth in Section 1366.1.
   (2) Establishes an exclusive relationship with a real estate
broker through which the sale or marketing of interests in the
development is required to occur.  The limitation set forth in this
paragraph does not apply to the sale or marketing of separate
interests owned by the association  or to the sale or marketing of
common areas by the association.
   (c) For purposes of this section, "market" and "marketing" mean
listing, advertising, or obtaining or providing access to show the
owner's interest in the development.
   (d) This section does not apply to rules or regulations made
pursuant to Section 712 or 713 regarding real estate signs.



1368.4.  (a) Not later than 30 days prior to the filing of any civil
action by the association against the declarant or other developer
of a common interest development for alleged damage to the common
areas, alleged damage to the separate interests that the association
is obligated to maintain or repair, or alleged damage to the separate
interests that arises out of, or is integrally related to, damage to
the common areas or separate interests that the association is
obligated to maintain or repair, the board of directors of the
association shall a provide  written notice to each member of the
association who appears on the records of the association when the
notice is provided.  This notice shall specify all of the following:

   (1) That a meeting will take place to discuss problems that may
lead to the filing of a civil action.
   (2) The options, including civil actions, that are available to
address the problems.
   (3) The time and place of this meeting.
   (b) Notwithstanding subdivision (a), if the association has reason
to believe that the applicable statute of limitations will expire
before the association files the civil action, the association may
give the notice, as described above, within 30 days after the filing
of the action.


1369.  In a condominium project, no labor performed or services or
materials furnished with the consent of, or at the request of, an
owner  in the condominium project or his or her agent or his or her
contractor shall be the basis for the filing of a lien against any
other property of any other owner in the condominium project unless
that other owner has expressly consented to or requested the
performance of the labor or furnishing of the materials or services.
However, express consent shall be deemed to have been given by the
owner of any condominium in the case of emergency repairs thereto.
Labor performed or services or materials furnished for the common
areas, if duly authorized by the association, shall be deemed to be
performed or furnished with the express consent of each condominium
owner.  The owner of any condominium may remove his or her
condominium from a lien against two or more condominiums or any part
thereof by payment to the holder of the lien of the fraction of the
total sum secured by the lien which is attributable to his or her
condominium.



1370.  Any deed, declaration, or condominium plan for a common
interest development shall be liberally construed to facilitate the
operation of the common interest development, and its provisions
shall be presumed to be independent and severable.  Nothing in
Article 3 (commencing with Section 715) of Chapter 2 of Title 2 of
Part 1 of this division shall operate to invalidate any provisions of
the governing documents of a common interest development.



1371.  In interpreting deeds and condominium plans, the existing
physical boundaries of a unit in a condominium project, when the
boundaries of the unit are contained within a building, or of a unit
reconstructed in substantial accordance with the original plans
thereof, shall be conclusively presumed to be its boundaries rather
than the metes and bounds expressed in the deed or condominium plan,
if any exists, regardless of settling or lateral movement of the
building and regardless of minor variance between boundaries shown on
the plan or in the deed and those of the building.



1372.  Unless a contrary intent is clearly expressed, local zoning
ordinances shall be construed to treat like structures, lots,
parcels, areas, or spaces in like manner regardless of whether the
common interest development is a community apartment project,
condominium project, planned development, or stock cooperative.




1373.  Sections 1356, 1365, 1365.5, 1366.1, and 1368, and
subdivision (b) of Section 1363, and subdivision (b) of Section 1366
are not applicable to common interest developments that are expressly
zoned as industrial developments and limited in use to industrial
purposes or expressly zoned as commercial developments and limited in
use to commercial purposes.
   The Legislature finds that those aforementioned provisions may be
appropriate to protect purchasers in residential common interest
developments, however, the provisions are not necessary to protect
purchasers in commercial or industrial developments since the
application of those provisions results in unnecessary burdens and
costs for these types of developments.



1374.  Nothing in this title may be construed to apply to a
development wherein there does not exist a common area as defined in
subdivision (b) of Section 1351, nor may this title be construed to
confer standing pursuant to Section 383 of the Code of Civil
Procedure to an association created for the purpose of managing a
development wherein there does not exist a common area.
   This section is declaratory of existing law.



1375.  (a) Before an association files a complaint for damages
against a builder, developer, or general contractor ("respondent") of
a common interest development based upon a claim for defects in the
design or construction of the common interest development, all of the
requirements of this section shall be satisfied with respect to the
builder, developer, or general contractor.
   (b) The association shall serve upon the respondent a "Notice of
Commencement of Legal Proceedings."  The notice shall be served by
certified mail to the registered agent of the respondent, or if there
is no registered agent, then to any officer of the respondent.  If
there are no current officers of the respondent, service shall be
upon the person or entity otherwise authorized by law to receive
service of process.  Service upon the general contractor shall be
sufficient to initiate the process set forth in this section with
regard to any builder or developer, if the builder or developer is
not amenable to service of process by the foregoing methods.  This
notice shall toll all applicable statutes of limitation and repose,
whether contractual or statutory, by and against all potentially
responsible parties, regardless of whether they were named in the
notice, including claims for indemnity applicable to the claim for
the period set forth in subdivision (c).  The notice shall include
all of the following:
   (1) The name and location of the project.
   (2) An initial list of defects sufficient to apprise the
respondent of the general nature of the defects at issue.
   (3) A description of the results of the defects, if known.
   (4) A summary of the results of a survey or questionnaire
distributed to homeowners to determine the nature and extent of
defects, if a survey has been conducted or a questionnaire has been
distributed.
   (5) Either a summary of the results of testing conducted to
determine the nature and extent of defects or the actual test
results, if that testing has been conducted.
   (c) Service of the notice shall commence a period, not to exceed
180 days, during which the association, the respondent, and all other
participating parties shall try to resolve the dispute through the
processes set forth in this section.  This 180-day period may be
extended for one additional period, not to exceed 180 days, only upon
the mutual agreement of the association, the respondent, and any
parties not deemed peripheral pursuant to paragraph (3) of
subdivision (e).  Any extensions beyond the first extension shall
require the agreement of all participating parties.  Unless extended,
the dispute resolution process prescribed by this section shall be
deemed completed.  All extensions shall continue the tolling period
described in subdivision (b).
   (d) Within 25 days of the date the association serves the Notice
of Commencement of Legal Proceedings, the respondent may request in
writing to meet and confer with the board of directors of the
association.  Unless the respondent and the association otherwise
agree, there shall be not more than one meeting, which shall take
place no later than 10 days from the date of the respondent's written
request, at a mutually agreeable time and place.  The meeting shall
be subject to subdivision (b) of Section 1363.05.  The discussions at
the meeting are privileged communications and are not admissible in
evidence in any civil action, unless the association and the
respondent consent in writing to their admission.
   (e) Upon receipt of the notice, the respondent shall, within 60
days, comply with the following:
   (1) The respondent shall provide the association with access to,
for inspection and copying of, all plans and specifications,
subcontracts, and other construction files for the project that are
reasonably calculated to lead to the discovery of admissible evidence
regarding the defects claimed.  The association shall provide the
respondent with access to, for inspection and copying of, all files
reasonably calculated to lead to the discovery of admissible evidence
regarding the defects claimed, including all reserve studies,
maintenance records and any survey questionnaires, or results of
testing to determine the nature and extent of defects.  To the extent
any of the above documents are withheld based on privilege, a
privilege log shall be prepared and submitted to all other parties.
All other potentially responsible parties shall have the same rights
as the respondent regarding the production of documents upon receipt
of written notice of the claim, and shall produce all relevant
documents within 60 days of receipt of the notice of the claim.
   (2) The respondent shall provide written notice by certified mail
to all subcontractors, design professionals, their insurers, and the
insurers of any additional insured whose identities are known to the
respondent or readily ascertainable by review of the project files or
other similar sources and whose potential responsibility appears on
the face of the notice.  This notice to subcontractors, design
professionals, and insurers shall include a copy of the Notice of
Commencement of Legal Proceedings, and shall specify the date and
manner by which the parties shall meet and confer to select a dispute
resolution facilitator pursuant to paragraph (1) of subdivision (f),
advise the recipient of its obligation to participate in the meet
and confer or serve a written acknowledgment of receipt regarding
this notice, advise the recipient that it will waive any challenge to
selection of the dispute resolution facilitator if it elects not to
participate in the meet and confer, advise the recipient that it may
be bound by any settlement reached pursuant to subdivision (d) of
Section 1375.05, advise the recipient that it may be deemed to have
waived rights to conduct inspection and testing pursuant to
subdivision (c) of Section 1375.05, advise the recipient that it may
seek the assistance of an attorney, and advise the recipient that it
should contact its insurer, if any.  Any subcontractor or design
professional, or insurer for that subcontractor, design professional,
or additional insured, who receives written notice from the
respondent regarding the meet and confer shall, prior to the meet and
confer, serve on the respondent a written acknowledgment of receipt.
  That subcontractor or design professional shall, within 10 days of
service of the written acknowledgment of receipt, provide to the
association and the respondent a Statement of Insurance that includes
both of the following:
   (A) The names, addresses, and contact persons, if known, of all
insurance carriers, whether primary or excess and regardless of
whether a deductible or self-insured retention applies, whose
policies were in effect from the commencement of construction of the
subject project to the present and which potentially cover the
subject claims.
   (B) The applicable policy numbers for each policy of insurance
provided.
   (3) Any subcontractor or design professional, or insurer for that
subcontractor, design professional, or additional insured, who so
chooses, may, at any time, make a written request to the dispute
resolution facilitator for designation as a peripheral party.  That
request shall be served contemporaneously on the association and the
respondent.  If no objection to that designation is received within
15 days, or upon rejection of that objection, the dispute resolution
facilitator shall designate that subcontractor or design professional
as a peripheral party, and shall thereafter seek to limit the
attendance of that subcontractor or design professional only to those
dispute resolution sessions deemed peripheral party sessions or to
those sessions during which the dispute resolution facilitator
believes settlement as to peripheral parties may be finalized.
Nothing in this subdivision shall preclude a party who has been
designated a peripheral party from being reclassified as a
nonperipheral party, nor shall this subdivision preclude a party
designated as a nonperipheral party from being reclassified as a
peripheral party after notice to all parties and an opportunity to
object.  For purposes of this subdivision, a peripheral party is a
party having total claimed exposure of less than twenty-five thousand
dollars ($25,000).
   (f) (1) Within 20 days of sending the notice set forth in
paragraph (2) of subdivision (e), the association, respondent,
subcontractors, design professionals, and their insurers who have
been sent a notice as described in paragraph (2) of subdivision (e)
shall meet and confer in an effort to select a dispute resolution
facilitator to preside over the mandatory dispute resolution process
prescribed by this section.  Any subcontractor or design professional
who has been given timely notice of this meeting but who does not
participate, waives any challenge he or she may have as to the
selection of the dispute resolution facilitator.  The role of the
dispute resolution facilitator is to attempt to resolve the conflict
in a fair manner.  The dispute resolution facilitator shall be
sufficiently knowledgeable in the subject matter and be able to
devote sufficient time to the case.  The dispute resolution
facilitator shall not be required to reside in or have an office in
the county in which the project is located.  The dispute resolution
facilitator and the participating parties shall agree to a date,
time, and location to hold a case management meeting of all parties
and the dispute resolution facilitator, to discuss the claims being
asserted and the scheduling of events under this section.  The case
management meeting with the dispute resolution facilitator shall be
held within 100 days of service of the Notice of Commencement of
Legal Proceedings at a location in the county where the project is
located.  Written notice of the case management meeting with the
dispute resolution facilitator shall be sent by the respondent to the
association, subcontractors and design professionals, and their
insurers who are known to the respondent to be on notice of the
claim, no later than 10 days prior to the case management meeting,
and shall specify its date, time, and location.  The dispute
resolution facilitator in consultation with the respondent shall
maintain a contact list of the participating parties.
   (2) No later than 10 days prior to the case management meeting,
the dispute resolution facilitator shall disclose to the parties all
matters that could cause a person aware of the facts to reasonably
entertain a doubt that the proposed dispute resolution facilitator
would be able to resolve the conflict in a fair manner.  The
facilitator's disclosure shall include the existence of any ground
specified in Section 170.1 of the Code of Civil Procedure for
disqualification of a judge, any attorney-client relationship the
facilitator has or had with any party or lawyer for a party to the
dispute resolution process, and any professional or significant
personal relationship the facilitator or his or her spouse or minor
child living in the household has or had with any party to the
dispute resolution process.  The disclosure shall also be provided to
any subsequently noticed subcontractor or design professional within
10 days of the notice.
   (3) A dispute resolution facilitator shall be disqualified by the
court if he or she fails to comply with this paragraph and any party
to the dispute resolution process serves a notice of disqualification
prior to the case management meeting.  If the dispute resolution
facilitator complies with this paragraph, he or she shall be
disqualified by the court on the basis of the disclosure if any party
to the dispute resolution process serves a notice of
disqualification prior to the case management meeting.
   (4) If the parties cannot mutually agree to a dispute resolution
facilitator, then each party shall submit a list of three dispute
resolution facilitators.  Each party may then strike one nominee from
the other parties' list, and petition the court, pursuant to the
procedure described in subdivisions (n) and (o), for final selection
of the dispute resolution facilitator.  The court may issue an order
for final selection of the dispute resolution facilitator pursuant to
this paragraph.
   (5) Any subcontractor or design professional who receives notice
of the association's claim without having previously received timely
notice of the meet and confer to select the dispute resolution
facilitator shall be notified by the respondent regarding the name,
address, and telephone number of the dispute resolution facilitator.
Any such subcontractor or design professional may serve upon the
parties and the dispute resolution facilitator a written objection to
the dispute resolution facilitator within 15 days of receiving
notice of the claim.  Within seven days after service of this
objection, the subcontractor or design professional may petition the
superior court to replace the dispute resolution facilitator.  The
court may replace the dispute resolution facilitator only upon a
showing of good cause, liberally construed.  Failure to satisfy the
deadlines set forth in this subdivision shall constitute a waiver of
the right to challenge the dispute resolution facilitator.
   (6) The costs of the dispute resolution facilitator shall be
apportioned in the following manner:  one-third to be paid by the
association; one-third to be paid by the respondent; and one-third to
be paid by the subcontractors and design professionals, as allocated
among them by the dispute resolution facilitator.  The costs of the
dispute resolution facilitator shall be recoverable by the prevailing
party in any subsequent litigation pursuant to Section 1032 of the
Code of Civil Procedure, provided however that any nonsettling party
may, prior to the filing of the complaint, petition the facilitator
to reallocate the costs of the dispute resolution facilitator as they
apply to any nonsettling party.  The determination of the dispute
resolution facilitator with respect to the allocation of these costs
shall be binding in any subsequent litigation.  The dispute
resolution facilitator shall take into account all relevant factors
and equities between all parties in the dispute resolution process
when reallocating costs.
   (7) In the event the dispute resolution facilitator is replaced at
any time, the case management statement created pursuant to
subdivision (h) shall remain in full force and effect.
   (8) The dispute resolution facilitator shall be empowered to
enforce all provisions of this section.
   (g) (1) No later than the case management meeting, the parties
shall begin to generate a data compilation showing the following
information regarding the alleged defects at issue:
   (A) The scope of the work performed by each potentially
responsible subcontractor.
   (B) The tract or phase number in which each subcontractor provided
goods or services, or both.
   (C) The units, either by address, unit number, or lot number, at
which each subcontractor provided goods or services, or both.
   (2) This data compilation shall be updated as needed to reflect
additional information.  Each party attending the case management
meeting, and any subsequent meeting pursuant to this section, shall
provide all information available to that party relevant to this data
compilation.
   (h) At the case management meeting, the parties shall, with the
assistance of the dispute resolution facilitator, reach agreement on
a case management statement, which shall set forth all of the
elements set forth in paragraphs (1) to (8), inclusive, except that
the parties may dispense with one or more of these elements if they
agree that it is appropriate to do so.  The case management statement
shall provide that the following elements shall take place in the
following order:
   (1) Establishment of a document depository, located in the county
where the project is located, for deposit of documents, defect lists,
demands, and other information provided for under this section.  All
documents exchanged by the parties and all documents created
pursuant to this subdivision shall be deposited in the document
depository, which shall be available to all parties throughout the
prefiling dispute resolution process and in any subsequent
litigation.  When any document is deposited in the document
depository, the party depositing the document shall provide written
notice identifying the document to all other parties.  The costs of
maintaining the document depository shall be apportioned among the
parties in the same manner as the costs of the dispute resolution
facilitator.
   (2) Provision of a more detailed list of defects by the
association to the respondent after the association completes a
visual inspection of the project.  This list of defects shall provide
sufficient detail for the respondent to ensure that all potentially
responsible subcontractors and design professionals are provided with
notice of the dispute resolution process.  If not already completed
prior to the case management meeting, the Notice of Commencement of
Legal Proceedings shall be served by the respondent on all additional
subcontractors and design professionals whose potential
responsibility appears on the face of the more detailed list of
defects within seven days of receipt of the more detailed list.  The
respondent shall serve a copy of the case management statement,
including the name, address, and telephone number of the dispute
resolution facilitator, to all the potentially responsible
subcontractors and design professionals at the same time.
   (3) Nonintrusive visual inspection of the project by the
respondent, subcontractors, and design professionals.
   (4) Invasive testing conducted by the association, if the
association deems appropriate.  All parties may observe and
photograph any testing conducted by the association pursuant to this
paragraph, but may not take samples or direct testing unless, by
mutual agreement, costs of testing are shared by the parties.
   (5) Provision by the association of a comprehensive demand which
provides sufficient detail for the parties to engage in meaningful
dispute resolution as contemplated under this section.
   (6) Invasive testing conducted by the respondent, subcontractors,
and design professionals, if they deem appropriate.
   (7) Allowance for modification of the demand by the association if
new issues arise during the testing conducted by the respondent,
subcontractor, or design professionals.
   (8) Facilitated dispute resolution of the claim, with all parties,
including peripheral parties, as appropriate, and insurers, if any,
present and having settlement authority.  The dispute resolution
facilitators shall endeavor to set specific times for the attendance
of specific parties at dispute resolution sessions.  If the dispute
resolution facilitator does not set specific times for the attendance
of parties at dispute resolution sessions, the dispute resolution
facilitator shall permit those parties to participate in dispute
resolution sessions by telephone.
   (i) In addition to the foregoing elements of the case management
statement described in subdivision (h), upon mutual agreement of the
parties, the dispute resolution facilitator may include any or all of
the following elements in a case management statement:  the exchange
of consultant or expert photographs; expert presentations; expert
meetings; or any other mechanism deemed appropriate by the parties in
the interest of resolving the dispute.
   (j) The dispute resolution facilitator, with the guidance of the
parties, shall at the time the case management statement is
established, set deadlines for the occurrence of each event set forth
in the case management statement, taking into account such factors
as the size and complexity of the case, and the requirement of this
section that this dispute resolution process not exceed 180 days
absent agreement of the parties to an extension of time.
   (k) (1) (A) At a time to be determined by the dispute resolution
facilitator, the respondent may submit to the association all of the
following:
   (i) A request to meet with the board to discuss a written
settlement offer.
   (ii) A written settlement offer, and a concise explanation of the
reasons for the terms of the offer.
   (iii) A statement that the respondent has access to sufficient
funds to satisfy the conditions of the settlement offer.
   (iv) A summary of the results of testing conducted for the
purposes of determining the nature and extent of defects, if this
testing has been conducted, unless the association provided the
respondent with actual test results.
   (B) If the respondent does not timely submit the items required by
this subdivision, the association shall be relieved of any further
obligation to satisfy the requirements of this subdivision only.
   (C) No less than 10 days after the respondent submits the items
required by this paragraph, the respondent and the board of directors
of the association shall meet and confer about the respondent's
settlement offer.
   (D) If the association's board of directors rejects a settlement
offer presented at the meeting held pursuant to this subdivision, the
board shall hold a meeting open to each member of the association.
The meeting shall be held no less than 15 days before the association
commences an action for damages against the respondent.
   (E) No less than 15 days before this meeting is held, a written
notice shall be sent to each member of the association specifying all
of the following:
   (i) That a meeting will take place to discuss problems that may
lead to the filing of a civil action, and the time and place of this
meeting.
   (ii) The options that are available to address the problems,
including the filing of a civil action and a statement of the various
alternatives that are reasonably foreseeable by the association to
pay for those options and whether these payments are expected to be
made from the use of reserve account funds or the imposition of
regular or special assessments, or emergency assessment increases.
   (iii) The complete text of any written settlement offer, and a
concise explanation of the specific reasons for the terms of the
offer submitted to the board at the meeting held pursuant to
subdivision (d) that was received from the respondent.
   (F) The respondent shall pay all expenses attributable to sending
the settlement offer to all members of the association.  The
respondent shall also pay the expense of holding the meeting, not to
exceed three dollars ($3) per association member.
   (G) The discussions at the meeting and the contents of the notice
and the items required to be specified in the notice pursuant to
paragraph (E) are privileged communications and are not admissible in
evidence in any civil action, unless the association consents to
their admission.
   (H) No more than one request to meet and discuss a written
settlement offer may be made by the respondent pursuant to this
subdivision.
   (l)  Except for the purpose of in camera review as provided in
subdivision (c) of Section 1375.05, all defect lists and demands,
communications, negotiations, and settlement offers made in the
course of the prelitigation dispute resolution process provided by
this section shall be inadmissible pursuant to Sections 1119 to 1124,
inclusive, of the Evidence Code and all applicable decisional law.
This inadmissibility shall not be extended to any other documents or
communications which would not otherwise be deemed inadmissible.
   (m) Any subcontractor or design professional may, at any time,
petition the dispute resolution facilitator to release that party
from the dispute resolution process upon a showing that the
subcontractor or design professional is not potentially responsible
for the defect claims at issue.  The petition shall be served
contemporaneously on all other parties, who shall have 15 days from
the date of service to object.  If a subcontractor or design
professional is released, and it later appears to the dispute
resolution facilitator that it may be a responsible party in light of
the current defect list or demand, the respondent shall renotice the
party as provided by paragraph (2) of subdivision (e), provide a
copy of the current defect list or demand, and direct the party to
attend a dispute resolution session at a stated time and location.  A
party who subsequently appears after having been released by the
dispute resolution facilitator shall not be prejudiced by its absence
from the dispute resolution process as the result of having been
previously released by the dispute resolution facilitator.
   (n) Any party may, at any time, petition the superior court in the
county where the project is located, upon a showing of good cause,
and the court may issue an order, for any of the following, or for
appointment of a referee to resolve a dispute regarding any of the
following:
   (1) To take a deposition of any party to the process, or subpoena
a third party for deposition or production of documents, which is
necessary to further prelitigation resolution of the dispute.
   (2) To resolve any disputes concerning inspection, testing,
production of documents, or exchange of information provided for
under this section.
   (3) To resolve any disagreements relative to the timing or
contents of the case management statement.
   (4) To authorize internal extensions of timeframes set forth in
the case management statement.
   (5) To seek a determination that a settlement is a good faith
settlement pursuant to Section 877.6 of the Code of Civil Procedure
and all related authorities.  The page limitations and meet and
confer requirements specified in this section shall not apply to
these motions, which may be made on shortened notice.  Instead, these
motions shall be subject to other applicable state law, rules of
court, and local rules.  A determination made by the court pursuant
to this motion shall have the same force and effect as the
determination of a postfiling application or motion for good faith
settlement.
   (6) To ensure compliance, on shortened notice, with the obligation
to provide a Statement of Insurance pursuant to paragraph (2) of
subdivision (e).
   (7) For any other relief appropriate to the enforcement of the
provisions of this section, including the ordering of parties, and
insurers, if any, to the dispute resolution process with settlement
authority.
   (o) (1) A petition filed pursuant to subdivision (n) shall be
filed in the superior court in the county in which the project is
located.  The court shall hear and decide the petition within 10 days
after filing.  The petitioning party shall serve the petition on all
parties, including the date, time, and location of the hearing no
later than five business days prior to the hearing.  Any responsive
papers shall be filed and served no later than three business days
prior to the hearing.  Any petition or response filed under this
section shall be no more than three pages in length.
   (2) All parties shall meet with the dispute resolution
facilitator, if one has been appointed and confer in person or by the
telephone prior to the filing of that petition to attempt to resolve
the matter without requiring court intervention.
   (p) As used in this section:
   (1) "Association" shall have the same meaning as defined in
subdivision (a) of Section 1351.
   (2) "Builder" means the declarant, as defined in subdivision (g)
of Section 1351.
   (3) "Common interest development" shall have the same meaning as
in subdivision (c) of Section 1351, except that it shall not include
developments or projects with less than 20 units.
   (q) The alternative dispute resolution process and procedures
described in this section shall have no application or legal effect
other than as described in this section.
   (r) This section shall become operative on July 1, 2002, however
it shall not apply to any pending suit or claim for which notice has
previously been given.
   (s) This section shall become inoperative on July 1, 2010, and as
of January 1, 2011, is repealed, unless a later enacted statute, that
is enacted before January 1, 2011, deletes or extends the dates on
which it becomes inoperative and is repealed.



1375.05.  (a) Upon the completion of the mandatory prefiling dispute
resolution process described in Section 1375, if the parties have
not settled the matter, the association or its assignee may file a
complaint in the superior court in the county in which the project is
located.  Those matters shall be given trial priority.
   (b) In assigning trial priority, the court shall assign the
earliest possible trial date, taking into consideration the pretrial
preparation completed pursuant to Section 1375, and shall deem the
complaint to have been filed on the date of service of the Notice of
Commencement of Legal Proceedings described under Section 1375.
   (c) Any respondent, subcontractor, or design professional who
received timely prior notice of the inspections and testing conducted
under Section 1375 shall be prohibited from engaging in additional
inspection or testing, except if all of the following specific
conditions are met, upon motion to the court:
   (1) There is an insurer for a subcontractor or design
professional, that did not have timely notice that legal proceedings
were commenced under Section 1375 at least 30 days prior to the
commencement of inspections or testing pursuant to paragraph (6) of
subdivision (h) of Section 1375.
   (2) The insurer's insured did not participate in any inspections
or testing conducted under the provisions of paragraph (6) of
subdivision (h) of Section 1375.
   (3) The insurer has, after receiving notice of a complaint filed
in superior court under subdivision (a), retained separate counsel,
who did not participate in the Section 1375 dispute resolution
process, to defend its insured as to the allegations in the
complaint.
   (4) It is reasonably likely that the insured would suffer
prejudice if additional inspections or testing are not permitted.
   (5) The information obtainable through the proposed additional
inspections or testing is not available through any reasonable
alternative sources.
   If the court permits additional inspections or testing upon
finding that these requirements are met, any additional inspections
or testing shall be limited to the extent reasonably necessary to
avoid the likelihood of prejudice and shall be coordinated among all
similarly situated parties to ensure that they occur without
unnecessary duplication.  For purposes of providing notice to an
insurer prior to inspections or testing under paragraph (6) of
subdivision (h) of Section 1375, if notice of the proceedings was not
provided by the insurer's insured, notice may be made via certified
mail either by the subcontractor, design professional, association,
or respondent to the address specified in the Statement of Insurance
provided under paragraph (2) of subdivision (e) of Section 1375.
Nothing herein shall affect the rights of an intervenor who files a
complaint in intervention.  If the association alleges defects that
were not specified in the prefiling dispute resolution process under
Section 1375, the respondent, subcontractor, and design professionals
shall be permitted to engage in testing or inspection necessary to
respond to the additional claims.  A party who seeks additional
inspections or testing based upon the amendment of claims shall apply
to the court for leave to conduct those inspections or that testing.
  If the court determines that it must review the defect claims
alleged by the association in the prefiling dispute resolution
process in order to determine whether the association alleges new or
additional defects, this review shall be conducted in camera.  Upon
objection of any party, the court shall refer the matter to a judge
other than the assigned trial judge to determine if the claim has
been amended in a way that requires additional testing or inspection.

   (d) Any subcontractor or design professional who had notice of the
facilitated dispute resolution conducted under Section 1375 but
failed to attend, or attended without settlement authority, shall be
bound by the amount of any settlement reached in the facilitated
dispute resolution in any subsequent trial, although the affected
party may introduce evidence as to the allocation of the settlement.
Any party who failed to participate in the facilitated dispute
resolution because the party did not receive timely notice of the
mediation shall be relieved of any obligation to participate in the
settlement.  Notwithstanding any privilege applicable to the
prefiling dispute resolution process provided by Section 1375,
evidence may be introduced by any party to show whether a
subcontractor or design professional failed to attend or attended
without settlement authority.  The binding effect of this subdivision
shall in no way diminish or reduce a nonsettling subcontractor or
design professional's right to defend itself or assert all available
defenses relevant to its liability in any subsequent trial.  For
purposes of this subdivision, a subcontractor or design professional
shall not be deemed to have attended without settlement authority
because it asserted defenses to its potential liability.
   (e) Notice of the facilitated dispute resolution conducted under
Section 1375 must be mailed by the respondent no later than 20 days
prior to the date of the first facilitated dispute resolution session
to all parties.  Notice shall also be mailed to each of these
parties' known insurance carriers.  Mailing of this notice shall be
by certified mail.  Any subsequent facilitated dispute resolution
notices shall be served by any means reasonably calculated to provide
those parties actual notice.
   (f) As to the complaint, the order of discovery shall, at the
request of any defendant, except upon a showing of good cause, permit
the association's expert witnesses to be deposed prior to any
percipient party depositions.  The depositions shall, at the request
of the association, be followed immediately by the defendant's
experts and then by the subcontractors' and design professionals'
experts, except on a showing of good cause.  For purposes of this
section, in determining what constitutes "good cause," the court
shall consider, among other things, the goal of early disclosure of
defects and whether the expert is prepared to render a final opinion,
except that the court may modify the scope of any expert's
deposition to address those concerns.
   (g) (1) The only method of seeking judicial relief for the failure
of the association or the respondent to complete the dispute
resolution process under Section 1375 shall be the assertion, as
provided for in this subdivision, of a procedural deficiency to an
action for damages by the association against the respondent after
that action has been filed.  A verified application asserting a
procedural deficiency shall be filed with the court no later than 90
days after the answer to the plaintiff's complaint has been served,
unless the court finds that extraordinary conditions exist.
   (2) Upon the verified application of the association or the
respondent alleging substantial noncompliance with Section 1375, the
court shall schedule a hearing within 21 days of the application to
determine whether the association or respondent has substantially
complied with this section.  The issue may be determined upon
affidavits or upon oral testimony, in the discretion of the court.
   (3) (A) If the court finds that the association or the respondent
did not substantially comply with this paragraph, the court shall
stay the action for up to 90 days to allow the noncomplying party to
establish substantial compliance.  The court shall set a hearing
within 90 days to determine substantial compliance.  At any time, the
court may, for good cause shown, extend the period of the stay upon
application of the noncomplying party.
   (B) If, within the time set by the court pursuant to this
paragraph, the association or the respondent has not established that
it has substantially complied with this section, the court shall
determine if, in the interest of justice, the action should be
dismissed without prejudice, or if another remedy should be
fashioned.  Under no circumstances shall the court dismiss the action
with prejudice as a result of the association's failure to
substantially comply with this section.  In determining the
appropriate remedy, the court shall consider the extent to which the
respondent has complied with this section.
   (h) This section is operative on July 1, 2002, but does not apply
to any action or proceeding pending on that date.
   (i) This section shall become inoperative on July 1, 2010, and, as
of January 1, 2011, is repealed, unless a later enacted statute that
is enacted before January 1, 2011, deletes or extends the dates on
which it becomes inoperative and is repealed.



1375.1.  (a)  As soon as is reasonably practicable after the
association and the builder have entered into a settlement agreement
or the matter has otherwise been resolved regarding alleged defects
in the common areas, alleged defects in the separate interests that
the association is obligated to maintain or repair, or alleged
defects in the separate interests that arise out of, or are
integrally related to, defects in the common areas or separate
interests that the association is obligated to maintain or repair,
where the defects giving rise to the dispute have not been corrected,
the association shall, in writing, inform only the members of the
association whose names appear on the records of the association that
the matter has been resolved, by settlement agreement or other
means, and disclose all of the following:
   (1) A general description of the defects that the association
reasonably believes, as of the date of the disclosure, will be
corrected or replaced.
   (2) A good faith estimate, as of the date of the disclosure, of
when the association believes that the defects identified in
paragraph (1) will be corrected or replaced.  The association may
state that the estimate may be modified.
   (3) The status of the claims for defects in the design or
construction of the common interest development that were not
identified in paragraph (1) whether expressed in a preliminary list
of defects sent to each member of the association or otherwise
claimed and disclosed to the members of the association.
   (b) Nothing in this section shall preclude an association from
amending the disclosures required pursuant to subdivision (a), and
any amendments shall supersede any prior conflicting information
disclosed to the members of the association and shall retain any
privilege attached to the original disclosures.
   (c) Disclosure of the information required pursuant to subdivision
(a) or authorized by subdivision (b) shall not waive any privilege
attached to the information.
   (d) For the purposes of the disclosures required pursuant to this
section, the term "defects" shall be defined to include any damage
resulting from defects.



1376.  (a) Any covenant, condition, or restriction contained in any
deed, contract, security instrument, or other instrument affecting
the transfer or sale of, or any interest in, a common interest
development that effectively prohibits or restricts the installation
or use of a video or television antenna, including a satellite dish,
or that effectively prohibits or restricts the attachment of that
antenna to a structure within that development where the antenna is
not visible from any street or common area, except as otherwise
prohibited or restricted by law, is void and unenforceable as to its
application to the installation or use of a video or television
antenna that has a diameter or diagonal measurement of 36 inches or
less.
   (b) This section shall not apply to any covenant, condition, or
restriction, as described in subdivision (a), that imposes reasonable
restrictions on the installation or use of a video or television
antenna, including a satellite dish, that has a diameter or diagonal
measurement of 36 inches or less.  For purposes of this section,
"reasonable restrictions" means those restrictions that do not
significantly increase the cost of the video or television antenna
system, including all related equipment, or significantly decrease
its efficiency or performance and include all of the following:
   (1) Requirements for application and notice to the association
prior to the installation.
   (2) Requirement of the owner of a separate interest, as defined in
Section 1351, to obtain the approval of the association for the
installation of a video or television antenna that has a diameter or
diagonal measurement of 36 inches or less on a separate interest
owned by another.
   (3) Provision for the maintenance, repair, or replacement of roofs
or other building components.
   (4) Requirements for installers of a video or television antenna
to indemnify or reimburse the association or its members for loss or
damage caused by the installation, maintenance, or use of a video or
television antenna that has a diameter or diagonal measurement of 36
inches or less.
   (c) Whenever approval is required for the installation or use of a
video or television antenna, including a satellite dish, the
application for approval shall be processed by the appropriate
approving entity for the common interest development in the same
manner as an application for approval of an architectural
modification to the property, and the issuance of a decision on the
application shall not be willfully delayed.
   (d) In any action to enforce compliance with this section, the
prevailing party shall be awarded reasonable attorney's fees.