Epsten, APC

The act of creating a corporation, by the filing of articles of incorporation with the California Secretary of State.

Generally, when one agrees to indemnify another party, they are agreeing to reimburse them for an anticipated loss. Frequently in contracting, the drafter of the contract seeks to shift liability for an anticipated risk from the party performing the work to the party obtaining the benefit of the work. This can be problematic for homeowners associations; as such an indemnity provision may not be covered by the association’s insurance policy. Therefore, prior to entering into any contract which requires the association to indemnify any other party, the association should review this obligation with its legal counsel and insurance provider.

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A civil court order requiring an individual or entity to perform, or refrain from performing, a particular act. (I.e., An HOA may attempt to get an injunction against an individual homeowner requiring him to maintain his landscaping.) Injunctive relief is not liberally granted; the court will consider any hardship that both parties will sustain by granting or refusing the request for injunction. After issuing an injunction, the court, in its discretion may modify or dissolve the injunction at a later date if the circumstances so warrant.

Civil Code section 5200 requires certain documents be made available to requesting members within certain time frames. There are potentially serious ramifications for ignoring or delaying these types of requests. Some document production time frames are as short as 10 days! The documents produced should be reviewed by your attorney, redacted as necessary and provided in a systematic format. If you receive a document production request or think you may have, immediately contact your attorney.

The association shall select one or three independent third parties to serve as the inspectors of election. An independent third party may be a member of the association, but may not be a member of the board or a candidate for the board or related to either. An independent third party may not be employed by the association for any compensable services unless expressly authorized by the association’s election procedures. See Civil Code section 5110.

Associations typically have property (which covers the common areas and frequently the buildings in the subdivision), general liability, Directors & Officers (“D&O”), workers’ compensation and fidelity (theft) insurance. Other possible policies include earthquake, flood and employer’s liability (if the association has its own employees). With sufficient liability & D&O insurance, the directors and homeowners/members receive immunity from certain types of liability.

If an assessment is delinquent, an association may recover interest on (1) the delinquent assessments; (2) reasonable fees and costs of collection; and, (3) reasonable attorney’s fees, at up to 12% per annum, commencing 30 days after the assessment becomes due. If the declaration specifies interest at a lesser rate, the lesser rate of interest applies. (Civ. Code §5650(b))