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Davis-Stirling Common Interest Development Act

Part 5.  Common Interest Developments

Chapter 8.  Assessments and Assessment Collection

Article 3.  Assessment Collection

§5730.
Notice; Annual Policy Statement

(a) The annual policy statement, prepared pursuant to Section 5310, shall include the following notice, in at least 12-point type:

"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 FORECLOSURE
Assessments become delinquent 15 days after they are due, unless the governing documents provide for a longer time. The failure to pay association assessments may result in the loss of an owner's property through foreclosure. Foreclosure may occur either as a result of a court action, known as judicial foreclosure, or without court action, often referred to as nonjudicial foreclosure. For liens recorded on and after January 1, 2006, an association may not use judicial or nonjudicial foreclosure to enforce that lien if the amount of the delinquent assessments or dues, exclusive of any accelerated assessments, late charges, fees, attorney's fees, interest, and costs of collection, is less than one thousand eight hundred dollars ($1,800). For delinquent assessments or dues in excess of one thousand eight hundred dollars ($1,800) or more than 12 months delinquent, an association may use judicial or nonjudicial foreclosure subject to the conditions set forth in Article 3 (commencing with Section 5700) of Chapter 8 of Part 5 of Division 4 of the Civil Code. When using judicial or 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 amounts secured by the lien are not paid. (Sections 5700 through 5720 of the Civil Code, inclusive)
In a judicial or 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 area damaged by a member or a member's guests, if the governing documents provide for this. (Section 5725 of the Civil Code)
The association must comply with the requirements of Article 2 (commencing with Section 5650) of Chapter 8 of Part 5 of Division 4 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 5675 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, including 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 5660 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 5685 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, the owner 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. (Section 5655 of the Civil Code)
An owner may, but is not obligated to, pay under protest any disputed charge or sum levied by the association, including, but not limited to, an assessment, fine, penalty, late fee, collection cost, or monetary penalty imposed as a disciplinary measure, and by so doing, specifically reserve the right to contest the disputed charge or sum in court or otherwise.
An owner may dispute an assessment debt by submitting a written request for dispute resolution to the association as set forth in Article 2 (commencing with Section 5900) of Chapter 10 of Part 5 of Division 4 of the Civil Code. In addition, an association may not initiate a foreclosure without participating in alternative dispute resolution with a neutral third party as set forth in Article 3 (commencing with Section 5925) of Chapter 10 of Part 5 of Division 4 of the Civil Code, if so requested by the owner. Binding arbitration shall not be available if the association intends to initiate a judicial foreclosure.
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 5685 of the Civil Code)
MEETINGS AND PAYMENT PLANS
An owner of a separate interest that is not a time-share interest 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 exists. (Section 5665 of the Civil Code)
The board 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 5665 of the Civil Code)"

(b) An association distributing the notice required by this section to an owner of an interest that is described in Section 11212 of the Business and Professions Code that is not otherwise exempt from this section pursuant to subdivision (a) of Section 11211.7 of the Business and Professions Code may delete from the notice described in subdivision (a) the portion regarding meetings and payment plans.

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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