THE NEW AND IMPROVED DAVIS-STIRLING COMMON INTEREST DEVELOPMENT ACT (2013)

As is widely known, effective January 1, 2014, the new and improved Davis-Stirling Common Interest Development Act will replace the current one, which was first enacted in 1985 and has been evolving ever since then. The new legislation, Assembly Bill No. 805, primarily re organizes Davis-Stirling, making it more intuitive and user friendly. Instead of being found at Civil Code sections 1350 through 1378, the new Davis-Stirling statutes will be Civil Code sections 4000 through 6150. Associations need not be concerned about the change in section numbers because section 4235 of the new Davis-Stirling expressly permits the substitution of the new section numbers in governing documents simply by Board resolution, without approval of the members.

In addition to the re-organization, the new Davis-Stirling contains a few substantive changes, but they do not affect previous actions. Under new section 4010, an action taken or a document prepared (other than a governing document) before January 1, 2014 will remain valid if the document or action was proper under the old Davis-Stirling. The substantive changes are as follows (with the new section numbers in parentheses):  

A document required to be delivered to the Association must be delivered to the person designated by the Association. If no person has been designated, the document must be delivered to the President or Secretary. The permitted methods of delivery include electronic means (e.g., e-mail and facsimile) and personal delivery, if the association has assented to those methods. (4035)

The permitted methods for distributing documents to the membership include – in addition to the previously permitted methods of mail, overnight delivery, and electronic means if the recipient has consented in writing – ( 1 ) inclusion in a billing statement, newsletter, or other document that is delivered by one of the permitted methods; (2) posting the printed document in a designated, prominent location that is accessible to all members; or (3) inclusion in the association’s television programming. However, if a member requests to receive general notices by individual delivery, the document must be delivered by mail, overnight delivery, or electronic means if the member has given written consent to electronic delivery. (4045)

If there is any inconsistency between the law and the governing documents or between the various governing documents, the priority is in the following order: the law, then the Articles of Incorporation, then the CC&Rs, then the Bylaws, and then the operating rules. (4205) Although the old Davis-Stirling required that the operating rules be consistent with the other governing documents, it did not provide for priority amongst the other governing documents.

The written request to hold a special vote of the members on reversal of a rule change adopted by the Board can be delivered to the “association” and no longer need be delivered to the President or Secretary specifically. That vote must be held within 35 to 90 days after receipt of a proper request. (4365(b))

A new provision clarifies that limits imposed by Davis-Stirling on the regulation of the use of separate interests do not preempt or supersede any other statutory limits outside Davis-Stirling – e.g., Civil Code sections 712 and 713, relating to the display of signs; Civil Code sections 714 and 714.1 relating to solar energy systems; Civil Code section 714.5, relating to modular or pre-fabricated structures; Civil Code sections 782, 782.5, and 6150, relating to age restrictions; Government Code section 12956.1, relating to racial restrictions; Government Code section 12927, relating to disability accommodations; and Health and Safety Code section 1597.40, relating to family day care homes. (4700)

An Association may authorize the installation of an electric vehicle charging station in a common area, that is not an exclusive use common area, for the exclusive use of an owner only if installation in the owner’s designated parking space is impossible or unreasonably expensive. However, the Association or owners may install an electric vehicle charging station in the common area for the use of all members. An association also may create a new parking space where one did not previously exist to facilitate the installation of an electric vehicle charging station. (4745(g),(h),&(i))

The ballots from any election must be kept by the inspector(s) of election for a full year after the election, instead of the previously required nine months, before transferring them to the Association. (5125)

Many of the already required annual disclosures have been consolidated into an annual policy that must be distributed within 30 to 90 days before the fiscal year end. In addition to the previously required disclosures, the new Davis-Stirling added the following: (1) the person designated to receive official communications sent to the association, (2) the location, if any, designated for posting of notices, (3) a member’s option to receive general notices by individual delivery, and (4) the association’s discipline policy, if any, including any schedule of penalties for violations of the governing documents (previously only the fine schedule needed to be distributed and only when it changed). (5310)

If the fine schedule is adopted or revised after the annual policy is distributed, a supplement must be delivered to the members individually. Fines must not exceed the amount stated in the fine schedule that is in effect at the time of the violation. The Association must provide a copy of the current fine schedule to any member upon request. (5850)

Neither disciplinary action nor a monetary charge for damage to the common area can be effective against a member unless the board fulfills the notice and hearing requirements. (5855)

A director or committee member is prohibited from voting on discipline of that director or committee member, an assessment against that director or committee member for damage to the common area or facilities, that director’s or committee member’s request for a payment plan for overdue assessments, a decision whether to foreclose on that director’s or committee member’s separate interest, a proposed physical change to that director’s or committee member’s separate interest, or a grant of exclusive use common area to that director or committee member. However, this prohibition does not limit any other provision of law or the governing documents that govern a decision in which a director may have an interest, which may mean that the governing documents may allow the prohibited votes. (5350)

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