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Davis-Stirling Common Interest Development Act

Part 5.  Common Interest Developments

Chapter 6.  Association Governance

Article 9.  Managing Agent

§5380.
Management of Common Interest Funds

    (a) A managing agent of a common interest development who accepts or receives funds belonging to the association shall deposit those 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, 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 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 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 the managing agent's 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 the managing agent's own money or with the money of others that the managing agent 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 each association that the managing agent 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 each association.

    (2) The managing agent discloses in the written agreement whether the managing agent 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 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, "completed payment" means funds received that clearly identify the account to which the funds are to be credited.

Davis-Stirling Common Interest Development Act
Part 5.  Common Interest Developments
Chapter 1. General Provisions
Article 1. Preliminary Provisions
§ 4000.Citation
§ 4005.Headings
§ 4010.Effect of Act on Documents or Actions Before January 1, 2014
§ 4020.Construction of Zoning Ordinances
§ 4035.Delivery of Documents to Association
§ 4040.Individual Delivery or Individual Notice
§ 4045.General Delivery or General Notice
§ 4050.Completion of Delivery
§ 4055.Electronic Delivery
§ 4065.Approval by Majority Vote
§ 4070.Approval by Majority of a Quorum
Article 2. Definitions
§ 4075.Definitions
§ 4076.Annual Budget Report
§ 4078.Annual Policy Statement
§ 4080.Association
§ 4085.Board
§ 4090.Board Meeting
§ 4095.Common Area
§ 4100.Common Interest Development
§ 4105.Community Apartment Project
§ 4110.Community Service Organization or Similar Entity
§ 4120.Condominium Plan
§ 4125.Condominium Project
§ 4130.Declarant
§ 4135.Declaration
§ 4140.Director
§ 4145.Exclusive Use Common Area
§ 4148.General Notice
§ 4150.Governing Documents
§ 4153.Individual Notice
§ 4155.Item of Business
§ 4158.Managing Agent
§ 4160.Member
§ 4170.Person
§ 4175.Planned Development
§ 4177.Reserve Accounts
§ 4178.Reserve Account Requirements
§ 4185.Separate Interest
§ 4190.Stock Cooperative
Chapter 2. Application of Act
§ 4200.Application of Act; Creation of Common Interest Development
§ 4201.Requirement of Common Area
§ 4202.Nonapplicable Provisions for Commercial CIDs
Chapter 3. Governing Documents
Article 1. General Provisions
§ 4205.Controlling Authority
§ 4210.Assessments; Board Statements
§ 4215.Liberal Construction of Instruments
§ 4220.Boundaries of Units; Presumption
§ 4225.Discriminatory Restrictive Covenants; Removal from Governing Documents
§ 4230.Amendment of Governing Documents for Certain Declarant Provisions
§ 4235.Amendment of Governing Documents to Reflect Changes in the Davis-Stirling Common Interest Development Act
Article 2. Declaration
§ 4250.Declaration; Contents
§ 4255.Declaration; Notice of Airport in Vicinity; Notice of San Francisco Bay Conservation and Development Commission Jurisdiction.
§ 4260.Permissible Amendment of Declaration
§ 4265.Extension of Term of Declaration
§ 4270.Amendment of Declaration; Effective Date
§ 4275.Amendment of Declaration; Power of Court to Approve Amendment; Recording Amendment; Mailing
Article 3. Articles of Incorporation
§ 4280.Articles of Incorporation; Identifying Corporation as Association; Business Office Address; Managing Agent's Name and Address
Article 4. Condominium Plan
§ 4285.Condominium Plan; Requirements
§ 4290.Certificate Consenting to Recordation of Condominium Plan; Signature Requirement
§ 4295.Condominium Plan; Amendment or Revocation
Article 5. Operating Rules 20
§ 4340.Operating Rules; Definitions
§ 4350.Validity of Operating Rules
§ 4355.Application of §4360 and §4365
§ 4360.Notice of Rule Change
§ 4365.Notice of Reversal of Rule Change
§ 4370.Application of Article
Chapter 4. Ownership and Transfer of Interests
Article 1. Ownership Rights and Interests
§ 4500.Ownership of Common Area
§ 4505.Common Area Rights and Easements
§ 4510.Access to Owners' Separate Interest
Article 2. Transfer Disclosure
§ 4525.Sale or Title Transfer; Provisions of Specified Items to Prospective Purchasers
§ 4528.Billing Disclosures
§ 4530.Sale or Title Transfer; Copies; Fees
§ 4535.Application of §1133 and §1134
§ 4540.Enforcement of Act
§ 4545.Validity of Title Transferred in Violation
Article 3. Transfer Fee
§ 4575.Prohibition of Fees
§ 4580.Exceptions
Article 4. Restrictions on Transfer
§ 4600.Granting Exclusive Use of Common Area
§ 4605.Actions for Violations
§ 4610.Partition
§ 4615.Labor Performed, Services or Materials
Article 5. Transfer of Separate Interest
§ 4625.Community Apartment Project Transfer of Separate Interest
§ 4630.Condominium Project Transfer of Separate Interest
§ 4635.Planned Development Transfer of Separate Interest
§ 4640.Stock Cooperative Transfer of Separate Interest
§ 4645.Transfer of Exclusive Use Areas
§ 4650.Restrictions on Partition
Chapter 5. Property Use and Maintenance
Article 1. Protected Uses
§ 4700.Limitations on Regulation of Separate Interest
§ 4705.Display of the Flag of the United States of America
§ 4710.Sign Restrictions
§ 4715.Restrictions on Pets
§ 4720.Roof Coverings; Fires and Fire Protection
§ 4725.Video or Television Antennas; Satellite Dish Systems; Restrictions on Installation; Application for Approval
§ 4730.Prohibition of Marketing Limitations
§ 4735.Low Water-using Plants; Water-Efficient Landscape Ordinances; Emergency Water Use Regulations
§ 4740.Rental or Lease of Separate Interest
§ 4745.Electric Vehicle Charging Stations; Prohibition of Unreasonable Restrictions; Requirements; Maintenance by Owner; Maintenance by Association; Attorney's Fees
Article 2. Modification of Separate Interest
§ 4760.Permissive Modification of Separate Interest; Requirements
§ 4765.Architectural or Design Review; Procedures for Approval
Article 3. Maintenance
§ 4775.Association Responsibility for Repair, Replacement or Maintenance; Cost Allocation
§ 4780.Damage by Wood-Destroying Pests or Organisms
§ 4785.Notice of Removal of Occupants; Treatment of Wood-Destroying Pests and Organisms
§ 4790.Access for Maintenance of Telephone Wiring
Chapter 6. Association Governance
Article 1. Association Existence and Powers
§ 4800.Management
§ 4805.Powers of Association
§ 4820.Joint Neighborhood Associations; Membership rights
Article 2. Board Meeting
§ 4900.Common Interest Development Open Meeting Act
§ 4910.Board Meeting Required for Action; Electronic Transmissions
§ 4920.Notice of Board Meeting
§ 4923.Emergency Board Meeting
§ 4925.Member Attendance
§ 4930.Requirement for Action by Board; Agenda; Notice
§ 4935.Executive Session
§ 4950.Minutes of Meeting
§ 4955.Violation; Attorney's Fees; Fines
Article 3. Member Meeting
§ 5000.Member Meetings
Article 4. Member Election
§ 5100.Secret Ballot Elections
§ 5105.Election Rule Requirements; Equal Access for Candidates; Qualifications for Candidates; Qualifications for Voting; Inspectors; Nominations from Floor and Write-ins
§ 5110.Inspectors of Election; Duties
§ 5115.Secret Ballots; Procedures
§ 5120.Counting Ballots; Reporting
§ 5125.Custody of Ballots
§ 5130.Proxies
§ 5135.Prohibition of Association Funds for Campaign Purposes
§ 5145.Violation; Relief
Article 5. Record Inspection
§ 5200.Definitions
§ 5205.Availability of Records; Inspection and Copying
§ 5210.Time Periods; Access to Records
§ 5215.Permissible Redactions in Records
§ 5220.Member Opt Out
§ 5225.Reason for Request of Membership List
§ 5230.Restriction on Use of Records
§ 5235.Member Action; Attorney's Fees; Costs
§ 5240.Applicability of the Corporations Code; Applicability of Article to Community Service Organization
Article 6. Recordkeeping
§ 5260.Record Requests; Writing Requirement
Article 7. Annual Reports
§ 5300.Annual Budget Report; Requirements; Availability to Members; Admissibility as Evidence; Assessment and Reserve Funding Disclosure Summary
§ 5305.Review of Financial Statement; Distribution to Members
§ 5310.Annual Policy Statement; Requirements
§ 5320.Delivery of Full Report and Summary
Article 8. Conflict of Interest
§ 5350.Conflict of Interest; Applicability of Corporations Code
Article 9. Managing Agent
§ 5375.Prospective Managing Agent; Written Statement
§ 5380.Management of Common Interest Funds
§ 5385.Meaning of Managing Agent
Article 10. Government Assistance
§ 5400.On-Line Education for Directors
§ 5405.Identification and Registration of Community Associations
Chapter 7. Finances
Article 1. Accounting
§ 5500.Board of Directors; Duties; Operating and Reserve Accounts
Article 2. Use of Reserve Funds
§ 5510.Expenditure of Reserve Accounts
§ 5515.Borrowing from Reserve Accounts
§ 5520.Notice to Members; Accounting of Litigation Expenses
Article 3. Reserve Planning
§ 5550.Study of Reserve Accounts
§ 5560.Reserve Funding Plan; Adoption
§ 5565.Summary of Reserves
§ 5570.Disclosure
§ 5580.Community Service Organizations; Financial Disclosures
Chapter 8. Assessments and Assessment Collection
Article 1. Establishment and Imposition of Assessments
§ 5600.Levy of Assessments; Limitation on Imposition or Collection of Assessments or Fees
§ 5605.Limitation on Increases in Assessments
§ 5610.Emergency Assessments
§ 5615.Notice of Increased or Special Assessment
§ 5620.Exemption from Judgment
§ 5625.Assessments Based on Taxable Value of Separate Interest
Article 2. Assessment Payment and Delinquency
§ 5650.Assessments; Debt of Owner; Association Recovery
§ 5655.Payment of Delinquent Assessments
§ 5658.Payment Under Protest
§ 5660.Notice of Lien
§ 5665.Payment Plans
§ 5670.Meet and Confer
§ 5673.Board Approval Required to Record Lien
§ 5675.Lien; Notice of Delinquent Assessment
§ 5680.Priority of Lien
§ 5685.Release of Lien; Lien Recorded in Error
§ 5690.Failure to Comply with Article; Recommencing Notice
Article 3. Assessment Collection
§ 5700.Enforcement of Lien
§ 5705.Prior to Foreclosure of Liens for Assessment Debt Arising on or After January 1, 2006; Offer to Meet and Confer; Approval by Board; Notice by Personal Service
§ 5710.Sale by Trustee
§ 5715.Right of Redemption
§ 5720.Foreclosure of Liens for Assessment Debt Arising on or After January 1, 2006; Amount and Time Thresholds; Small Claims Court Judgments
§ 5725.Monetary Charge or Penalty Imposed by Association may become a Lien
§ 5730.Notice; Annual Policy Statement
§ 5735.Limitations on Assignment of Right to Collect
§ 5740.Application of Liens Recorded On or After January 1, 2003
Chapter 9. Insurance and Liability
§ 5800.Liability of Volunteer Officer or Director
§ 5805.Liability of Owner in Tenancy-In-Common Common Area
§ 5810.Notice of Insurance Policies
Chapter 10. Dispute Resolution and Enforcement
Article 1. Discipline and Cost Reimbursement
§ 5850.Schedule of Monetary Penalties
§ 5855.Disciplinary Actions and Monetary Charges Imposed by Board; Delivery; Notice
§ 5865.Authority of Board to Impose Monetary Penalties
Article 2. Internal Dispute Resolution
§ 5900.Dispute Resolution; Application
§ 5905.Fair, Reasonable, and Expeditious Procedures
§ 5910.Minimum Requirements; Dispute Resolution Procedures
§ 5915.Statutory Default Procedure
§ 5920.Annual Notice, Description of Association Meet and Confer Program
Article 3. Alternative Dispute Resolution Prerequisite to Civil Action
§ 5925.Definitions
§ 5930.Litigation Pre-Filing Requirements
§ 5935.Initiating the Process; Request for Resolution
§ 5940.Completing the Process; Costs
§ 5945.Statutes of Limitation
§ 5950.Certificate; Commencement of Action
§ 5955.Post-Filing Reference
§ 5960.Refusal to Participate in Pre-Filing Alternative Dispute Resolution
§ 5965.Annual Disclosure
Article 4. Civil Action
§ 5975.Enforcement of Governing Documents
§ 5980.Standing
§ 5985.Allocation of Damages
Chapter 11. Construction Defect Litigation
§ 6000.Filing a Claim for Construction Defects
§ 6100.Disclosure to Members; Resolution of Design or Construction Defect Dispute
§ 6150.Pre-Filing Notice to Members; Requirements
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