Legal Update

Approved Bills and Affected Statutes


AB 345Accessory Dwelling Units – Separate Conveyance

Effective January 1, 2022

Amends Government Code §§ 65852.2 and 65852.26.

Current law authorizes a local agency to provide, by ordinance, for the creation of accessory dwelling units in single-family and multifamily residential zones and requires a local agency that has not adopted an ordinance to ministerially approve an application for an accessory dwelling unit, and sets forth required ordinance standards, including that the ordinance prohibit the sale or conveyance of the accessory dwelling unit separately from the primary residence.

Existing law also authorizes a local agency to, by ordinance, allow an accessory dwelling unit to be sold or conveyed separately from the primary residence to a qualified buyer if certain conditions are met, including that the property was built or developed by a qualified nonprofit corporation and that the property is held pursuant to a recorded tenancy in common agreement.

Existing law requires that tenancy in common agreement to, among other things, allocate to each qualified buyer an undivided, unequal interest in the property based on the size of the dwelling each qualified buyer occupies.

AB 345 requires each local agency to allow an accessory dwelling unit to be sold or conveyed separately from the primary residence to a qualified buyer if the above-described conditions are met.

The statute imposes an additional condition on a tenancy in common agreement subject to these provisions and recorded on or after December 31, 2021, to include specified information, including a delineation of all areas of the property that are for the exclusive use of a cotenant, delineation of each cotenant’s responsibility for the costs of taxes, insurance, utilities, general maintenance and repair, and improvements associated with the property, and procedures for dispute resolution among cotenants before resorting to legal action.


AB 468Emotional Support Animals

Effective January 1, 2022

Enacts Health and Safety Code § 122317.

Existing Law makes a person who knowingly and fraudulently represents, through verbal or written notice, the person to be the owner or trainer of a canine licensed as, to be qualified as, or identified as, a guide, signal, or service dog, as defined, guilty of a misdemeanor punishable by imprisonment in the county jail not exceeding 6 months, by a fine not exceeding $1,000, or by both that fine and imprisonment.

AB 468 requires a person or business that sells a dog for use as an emotional support animal to provide written notice to the buyer or recipient of the dog stating that the dog does not have the special training required to qualify as a guide, signal, or service dog and is not entitled to the rights and privileges afforded by law to a guide, signal, or service dog, and that knowingly and fraudulently representing oneself to be the owner or trainer of any canine licensed as, to be qualified as, or identified as, a guide, signal, or service dog is a misdemeanor.

AB 468 requires a person or business that sells or provides a certificate, identification, tag, vest, leash, or harness for an emotional support animal to provide a written notice to the buyer or recipient.

AB 468 also prohibits a health care practitioner from providing documentation relating to an individual’s need for an emotional support dog unless the health care practitioner complies with specified requirements, including holding a valid license, establishing a client-provider relationship with the individual for at least 30 days prior to providing the documentation, and completing a clinical evaluation of the individual regarding the need for an emotional support dog.

AB 468 makes a violation of the written notice requirements or knowingly and fraudulently representing, selling, or offering for sale, or attempting to represent, sell, or offer for sale, an emotional support dog as being entitled to the rights and privileges afforded by law to a guide, signal, or service dog, subject to a civil penalty, as specified.

AB 468 states that this provision is not to be construed to restrict or change existing federal and state law related to a person’s rights for reasonable accommodation and equal access to housing, as specified.


AB 502Election Requirements

Effective January 1, 2022

Amends Civil Code § 5100 and enacts Civil Code § 5103.

Existing law provides for director nominees to be considered elected by acclamation if (1) the number of director nominees is not more than the number of vacancies to be elected, (2) the association includes 6,000 or more units, (3) the association provides individual notice of the election at least 30 days before the close of the nominations, (4) and the association permits all candidates to run if, nominated, except as specified.

AB 502 authorizes associations of any size to consider qualified candidates elected by acclamation if specified conditions are met. AB 502 revises the requirement that the association permit all candidates to run if nominated to instead require that the association so permit except for nominees disqualified from running as allowed or required pursuant to specified law. AB 502 deletes the requirement in the acclamation procedures that the association include 6,000 or more units. AB 502 also specifies that these procedures apply notwithstanding any contrary provision in the governing documents of the common interest development.


AB 611Safe at Home Program Address Usage

Effective January 1, 2022

Enacts Civil Code § 5216.

Existing law establishes an address confidentiality program, commonly known as the Safe at Home program, which designates the Secretary of State as the agent for service of process and receipt of mail for participants.

AB 611 requires the association of a common interest development to accept and use the address designated by the Secretary of State as the Safe at Home participant’s address for association communications and to withhold or redact information that would reveal the name, community property address, or email address of the Safe at Home participant in specified communications of the association.


AB 1101Common Interest Development Insurance

Effective January 1, 2022

Amends Civil Code §§ 5380, 5502, and 5806.

Existing law requires a managing agent, at the written request of the board of directors of an association, to deposit funds the managing agent receives on behalf of the association into a bank, savings association, or credit union in the state if specified requirements are met, including, among other things, that the funds are covered by insurance provided by the federal government.

AB 1101 requires the financial institution with whom the managing agent deposits funds on behalf of the association be insured by the Federal Deposit Insurance Corporation, National Credit Union Administration Insurance Fund, or a guaranty corporation. AB 1101 also imposes certain limits on the use of deposited association funds, including prohibiting investment in stocks or high-risk investment options.

AB 1101 also changes the limits on transfers out of the association’s reserve or operating accounts without prior written approval of the Board of Directors. Limits are based upon the size of the association.

For associations with 50 or less separate interests, transfers of funds out of the association’s reserve or operating accounts are prohibited unless the amount of the transfer is the lesser of five thousand dollars ($5,000) or 5% of the estimated income in the annual operating budget.

For associations with 51 or more separate interests, transfers of funds out of the association’s reserve or operating accounts are prohibited unless the amount of the transfer is the lesser of ten thousand dollars ($10,000) or 5% of the estimated income in the annual operating budget.

Existing law prohibits the managing agent from commingling 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 specified requirements are met. AB 1101 removes the specified requirements and prohibits the commingling of funds, without qualification.

Finally, AB 1101 requires the association to maintain crime insurance, employee dishonesty coverage, fidelity bond coverage, or the equivalent, for the association and the association’s managing agent or management company. AB 1101 also requires protection against computer and funds transfer fraud to be in an equal amount. Further, AB 1101 specifies that self-insurance does not meet the requirements of these provisions.


AB 1124Solar Energy Systems

Effective January 1, 2022

Amends Civil Code § 801.5 and Government Code § 66015.

Existing law creates a solar easement – a right to receive sunlight across real property of another for any solar energy system. Further, existing law defines “solar energy system” to mean either (1) any solar collector or other solar energy device whose primary purpose is to provide for the collection, storage, and distribution of solar energy for space heating, space cooling, electric generation, or water heating, or (2) a structural design feature of a building, including a design feature whose primary purpose is to provide for the collection, storage, and distribution of solar energy for electricity generation, space heating or cooling, or for water heating.

AB 1124 expands the definition of “solar energy system” to include the above-described solar devices or features that are designed to serve one or more utility retail customers on the same, adjacent, or contiguous properties, and is not designed for the procurement of electricity by an electric utility.

Additionally, AB 1124 eliminates the provision that the device be a feature of a building. AB 1124 specifies that certain structural design features be included in the definition, including solar racking, solar mounting, and elevated solar support structures, regardless of whether the feature is on the ground or on a building.


AB 1466Real Property Discriminatory Restrictions

Effective January 1, 2022

Amends Government Code §§ 12956.1, 12956.2, 27282, and 27388.1.

Enacts Government Code §§ 12956.3 and 27388.2.

Existing law, the California Fair Employment and Housing Act, prohibits discrimination in housing based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, marital status, national origin, ancestry, familial status, source of income, disability, veteran or military status, or genetic information, and provides that discrimination in housing through a restrictive covenant includes the existence of a restrictive covenant, regardless of whether accompanied by a statement that the covenant is repealed or void. Existing law also provides that a provision in any deed of real property in California that purports to restrict the right of any person to sell, lease, rent, use, or occupy the property to persons having the characteristics specified above by providing for payment of a penalty, forfeiture, reverter, or otherwise, is void, except as specified. Additionally, existing law provides that any deed or other written instrument that relates to title to real property, or any written covenant, condition, or restriction annexed or made a part of, by reference or otherwise, any deed or instrument, that contains any provision that purports to forbid, restrict, or condition the right of any person or persons to sell, buy, lease, rent, use, or occupy the property on account of any of characteristics specified above, is deemed to be revised to omit that provision.

Existing law also requires a county recorder, title insurance company, escrow company, real estate broker, real estate agent, or association that delivers a copy of a declaration, governing document, or deed, to place a cover page or stamp on the first page of the previously recorded document stating that if the document contains any restriction that unlawfully discriminates based on any of the characteristics specified above, that document is void.

AB 1466 authorizes a title company, escrow company, county recorder, real estate broker, real estate agent, or other person to record a Restrictive Covenant Modification form.

AB 1466 requires a title company, escrow company, real estate broker, or real estate agent that has actual knowledge of a declaration, governing document, or deed that is being directly delivered to a person who holds or is acquiring an ownership interest in property and includes a possible unlawfully restrictive covenant to notify the person of the existence of that covenant and their ability to have it removed through the restrictive covenant modification process.

Existing law authorizes recordation of certain documents, including a release, discharge, or subordination of a lien for postponed property taxes, without acknowledgment, certificate of acknowledgment, or further proof.

AB 1466 authorizes the recordation of any modification document, instrument, paper, or notice to remove a restrictive covenant that is in violation of specified provisions of the California Fair Employment and Housing Act without acknowledgment, certificate of acknowledgment, or further proof.

AB 1466 requires the county recorder to make Restrictive Covenant Modification forms available to the public onsite or online.


AB 1584Housing Omnibus

Effective January 1, 2022

Amends Civil Code § 4741.

Existing law authorizes a local agency to provide for the creation of accessory dwelling units by ordinance, and sets forth standards the ordinance is required to impose with respect to certain matters, including, among others, maximum unit size, parking, and height standards. Existing law authorizes a local agency to provide for the creation of junior accessory dwelling units, as defined, in single-family residential zones and requires the ordinance to include, among other things, standards for the creation of a junior accessory dwelling unit, required deed restrictions, and occupancy requirements.

Existing law makes void and unenforceable any covenant, restriction, or condition contained in any deed, contract, security instrument, or other instrument affecting the transfer or sale of any interest in a planned development, and any provision of a governing document, that effectively prohibits or unreasonably restricts the construction or use of an accessory dwelling unit or junior accessory dwelling unit on a lot zoned for single-family residential use that meets the above-described minimum standards established for those units. However, the Davis-Stirling Common Interest Development Act permits reasonable restrictions that do not unreasonably increase the cost to construct, effectively prohibit the construction of, or extinguish the ability to otherwise construct, an accessory dwelling unit or junior accessory dwelling unit consistent with those aforementioned minimum standards provisions.

AB 1584 makes void and unenforceable any covenant, restriction, or condition contained in any deed, contract, security instrument, or other instrument affecting the transfer or sale of any interest in real property that either effectively prohibits or unreasonably restricts the construction or use of an accessory dwelling unit or junior accessory dwelling unit on a lot zone for single-family residential use that meets the minimum standards established for those units, but does permit reasonable restrictions that do not unreasonably increase the cost to construct, effectively prohibit the construction of, or extinguish the ability to otherwise construct, an accessory dwelling unit or junior accessory dwelling unit consistent with the minimum standards established for those units.

Additionally, AB 1584 requires Boards of Directors, without the approval of the members, to amend any declaration, or other governing document, by no later than July 1, 2022, that includes prohibited rental restrictions.


SB 9Housing Development Approvals

Effective January 1, 2022

Amends Government Code § 66452.6.

Enacts Government Code §§ 65852.21 and 66411.7.

SB 9 requires a proposed housing development containing no more than two (2) residential units within a single-family residential zone to be considered ministerially by a local agency, without discretionary review or hearing, if the proposed housing development meets certain requirements. SB 9 also sets out standards for what a local agency can and cannot require in approving the construction of two (2) residential units.

SB9 also requires a local agency to ministerially approve a parcel map for an urban lot split that meets certain requirements. Further, SB 9 sets forth standards for what a local agency can and cannot require in approving an urban lot split. Importantly, one such requirement is that an applicant sign an affidavit stating that they intend to occupy one of the housing units as their principal residence for a minimum of 3 years from the date of the approval of the urban lot split and prohibits a local agency from imposing any additional owner occupancy standards by applicants.

In practice, SB 9 allows for up to four residential units to be constructed on the same lot where one single family residence previously stood.


SB 10Adopting Local Transit-Rich Zoning Ordinances

Effective January 1, 2022

Enacts Government Code § 65913.5.

SB 10 authorizes a local government to adopt an ordinance to zone any parcel for up to ten (10) units of residential density per parcel, at a height specified in the ordinance, if the parcel is located in a transit-rich area or an urban infill site, as those terms are defined.

Further, SB 10 prohibits an ordinance adopted under these provisions from reducing the density of any parcel subject to the ordinance and prohibits a legislative body from subsequently reducing the density of any parcel subject to the ordinance.


SB 60Maximum Fines for Health or Safety Infractions (Short-Term Rentals)

Effective Immediately

Amends Government Code §§ 25132 and 36900.

Existing law authorizes the legislative body of a city or county to make, by ordinance, any violation of an ordinance subject to an administrative fine or penalty and limits the maximum fine or penalty amounts for infractions.

SB 60 raises the maximum fines for violation of an ordinance relating to a short-term rental, which is an infraction and poses a threat to health or safety, to $1,500 for a first violation, $3,000 for a second violation of the same ordinance within one year, and $5,000 for each additional violation of the same ordinance within one year of the first violation. Certain exceptions apply.

Note that SB 60 takes effect immediately as an urgency statute.


SB 391Emergency Alternative Teleconferencing Procedures

Effective Immediately

Amends Civil Code § 4090.

Enacts Article 11 (commencing with § 5450) to the Civil Code.

SB 391 establishes alternative teleconferencing procedures for a board meeting or a meeting of association members if gathering in person is unsafe or impossible because the common interest development is in an area currently affected by a federal, state, or local emergency.

SB 391 allows associations more flexibility in conducting board meetings and meetings of the members. Given the current state of the COVID-19 pandemic and associated emergency orders, SB 391 allows associations to conduct business while ensuring board members and residents can take appropriate precautions.

Note that SB 391 takes effect immediately as an urgency statute.


SB 392Document Delivery

Effective January 1, 2021

Amends Civil Code §§ 4041, 4045, 4055, 5200, 5220, 5230, 5260, 5310, and 5320.

Amends, Adds, and Repeals Civil Code § 4040.

Existing law requires an association to deliver documents to members of a common interest development, if those documents are required to be delivered by individual delivery or notice, by either first-class mail, postage prepaid, registered or certified mail, express mail, or overnight delivery by an express service carrier or by email, facsimile, or other electronic means, if the recipient has consented, in writing or by email, to receive documents by that electronic means.

SB 392 requires an association to deliver those documents in accordance with the preferred delivery method specified by the member, or if the member has not provided a preferred delivery method, by traditional mail as existing law provides.

SB 392 requires a member to provide the member’s preferred delivery method for receiving notices and an alternate or secondary delivery method for receiving notices, and requires the association to include the options of receiving notice by mail, by a valid email address, or both. SB 392 requires a member to provide a valid email address, if available, of the owner’s legal representative, if any.

Additionally, SB 392 expands the authorized delivery methods by which an association may provide a document when a provision of the act requires general delivery or general notice to include posting the notice on the association’s internet website, if this method is so designated by the association in its annual policy statement.

Finally, SB 392 requires an association to include certain items in the required solicitation of notice described above, including that the member does not have to provide an email address to the association. SB 392 prohibits an association or its managing agent from transmitting a member’s personal information to a third party without the consent of the member unless required to do so by law.


SB 432Common Interest Developments

Effective January 1, 2022

Amends Civil Code §§ 5100, 5105, 5115, and 5200.

Amends Corporations Code § 7511

Under current law, an association is authorized to disqualify a person from nomination for the board of directors under certain circumstances, including if the person has been a member of the association for less than one year.

Existing law also requires an association to adopt operating rules for appointing one or three independent third parties as inspectors of elections and that allow the inspectors to appoint and oversee additional persons to verify signatures and to count and tabulate votes, provided that the persons are independent third parties. Existing law specifies criteria for who an independent third party may be, including a volunteer poll worker with the county registrar of voters, among others.

Existing law authorizes and regulates the formation and operation of various corporations, including a nonprofit mutual benefit corporation. Existing law, the Nonprofit Mutual Benefit Corporation Law, requires an officer of the board, upon a written request for a special meeting, to give a specified notice to the members entitled to vote that the special meeting will be held not less than 35 days nor more than 90 days after receipt of the request.

SB 432 revises and recasts common interest development election procedures, including, among other things, limiting certain noticing provisions to the elections of directors and to recall elections, requiring an association to maintain association election materials, as defined, for one year after the date of the election, and specifying that the candidate list is required to include the name and address of individuals nominated as a candidate for election to the board of directors. SB 432 includes among the permissible reasons for disqualifying a person from nomination if the person has served the maximum number of terms or sequential terms allowed by the association.

SB 432 requires the additional persons to be appointed and overseen by the inspectors of elections to also satisfy the criteria of who may be an independent third party. Further, SB 432, for a corporation that is a common interest development, requires the notice for a special meeting described above to be given not less than 35 days nor more than 150 days after receipt of the request.


SB 607Business and Professions Code Amendments

Effective January 1, 2022

Amends various Sections of the Business and Professions Code.

SB 607 makes a number of amendments to the Business and Professions Code. One relevant amendment is that SB 607 eliminates the prohibition against a contractor performing inspections of exterior elevated elements – including decks and balconies – from bidding on repair work of the same.

Note: Bill language used herein taken from leginfo.legislature.ca.gov


State and Federal Court Decisions


Brown v. Montage at Mission Hills

(2021) 68 Cal. App. 5th 124

Short-Term Rental Restrictions

Facts: Brown, a homeowner in the Montage at Mission Hills (Montage) common interest development, purchased a property in the community in 2002. Upon Brown’s purchase, Montage’s CC&Rs did not prohibit any form of renting, including short-term rentals. Brown consistently rented the property for short-term rentals (30 days or less) for about 15 years.

In January 2018, Montage amended its CC&Rs to prohibit its members, including Brown, from renting or leasing their properties for periods shorter than 30 days. Montage informed Brown that it would enforce the new prohibition against short-term rentals if Brown continued to rent her property for short-term rentals.

The court addressed two main issues. Firstly, the court addressed the issue of whether Montage could retroactively enforce the prohibition on short-term rentals. Secondly, the court addressed the issue of whether the prohibition on short-term rentals was properly considered merely a “restriction” or a complete “prohibition”.

Result: The court held that Brown was exempt from the prohibition on short-term rentals, because Montage’s prohibition on short-term rentals did not exist when Brown acquired title to her property in 2002. This fact exempted Brown from Montage’s prohibition on short-term rentals pursuant to Civil Code Section 4740, which, in relevant part, states:

“an owner of a separate interest in a common interest development shall not be subject to a provision in a governing document or an amendment to a governing document that prohibits the rental or leasing of any of the separate interests…”

In making this decision, the court relied on the fact that the legislative history of Section 4740 showed that the legislature sought for it to broadly address both rental “restrictions” and rental “prohibitions” in common interest developments. The court reasoned that, in light of this legislative history, the statute’s goal was to exempt common interest development property owners from any kind of rental prohibition or restriction that did not exist when the owner acquired title to the property.


C.L. v. Del Amo Hospital, Inc.

(2021) 992 F. 3rd 901

Certification of Service Dogs

Facts: C.L. was a victim of years of physical, psychological, and sexual abuse. C.L. was diagnosed with anxiety and depression and such diagnoses limited C.L.’s major life activities. To help manage her symptoms of PTSD, C.L. obtained a dog, Aspen. Plaintiff could not afford to pay for formal training and certification of the dog as a service animal, and instead she trained the dog herself.

On numerous occasions, C.L. sought inpatient treatment at Del Amo’s National Treatment Center. On each of seven admissions to the Treatment Center, Del Amo denied C.L.’s request to bring Aspen with her. Thereafter, C.L. brought suit against Del Amo for alleged violations of the Americans with Disabilities Act (ADA) and the California Unruh Civil Rights Act. The lower court determined that there were no such violations, because C.L. had not shown Aspen was or is a certified service dog within the legal standard prescribed under the ADA.

At issue was whether it is a misrepresentation of the ADA to effectively require a service dog to meet formal certification requirements.

Result: The court held that the ADA prohibits certification requirements for qualifying service dogs for three reasons: (1) the ADA defines a service dog functionally, without reference to specific training requirements, (2) Department of Justice (“DOJ”) regulations, rulemaking commentary, and guidance have consistently rejected a formal certification requirement, and (3) allowing a person with a disability to self-train a service animal furthers the stated goals of the ADA, for other training could be prohibitively expensive. This decision holds that the ADA does not require that service animals meet certification standards before their disabled owners are entitled to have the animals accompany them in places of public accommodation, such as the hospital owned by defendant. The service animal must be individually trained to perform tasks related to an individual’s disability, but the animal need not be formally certified.


Champir, LLC v. Fairbanks Ranch Assn.

(2021) 66 Cal. App. 5th 583

Definition of Prevailing Party under Davis-Striling Act

Facts: Plaintiffs sued their homeowners association over a dispute arising from the association’s plan to install traffic signals at the entrance gates of Fairbanks Ranch, one of which would be directly outside Plaintiffs’ home. Plaintiffs alleged the association failed to request a vote and obtain approval from its members before entering into a contract to install the traffic signals, as required by the governing documents.

The trial court granted Plaintiffs’ application for a temporary restraining order (TRO) and enjoined the association from construction of the traffic signal. However, the court eventually ordered the injunction dissolved, because the Association had recently obtained the written consent of a majority of the association’s members to proceed with installation of the traffic signal.

Result: Plaintiffs and the Association filed motions seeking reimbursement of their attorney’s fees and costs. The court determined, and the appellate court affirmed, that the plaintiffs were the prevailing party, because they achieved their litigation objective, which was to have the Association hold a vote to approve installation of the traffic signal.


Dickson v. Century Park East

(2021) United States District Court, Central District California

Collection of Delinquent Association Assessments

Facts: Plaintiff alleged that Century Park East Homeowners Association and the Association’s counsel engaged in unlawful debt collection activities involving the collection of homeowner assessments and other fees against Plaintiff. Plaintiff alleged the Association and counsel violated the California Rosenthal Fair Debt Collection Practices Act and that Association counsel violated the federal Fair Debt Collection Practices Act.

Plaintiff alleged that after she received two pre-lien letters, Defendants recorded a lien on Plaintiff’s property without complying with the Davis-Stirling Act thereby creating an unenforceable security interest and/or making the property exempt by law from such threatened dispossession.

Result: The court determined that the regular and special assessments at issue were not consumer credit transactions for purposes of the Rosenthal Fair Debt Collection Practices Act. Further, the court held that the Association and its legal counsel could not be debt collectors under the same act. The court’s rationale was that assessments are not loans or lines of credit to members of the Association. The court also reasoned that assessments do not involve the acquisition of a product or service by a homeowner for family or household use.

In contrast to its conclusion under the California statute, the court deemed the association assessments at issue debts for purposes of the federal Debt Collection Practices Act. However, the court held the Plaintiff failed to show the association’s law firm and attorneys were debt collectors as defined in the federal Debt Collection Practices Act.


Issakhani v. Shadow Glen Homeowners Assn., Inc.

(2021) 63 Cal. App. 5th 917

Negligence and Premises Liability of Association

Facts: Issakhani parked her car on the far side of a five-lane street then jaywalked across the street to get to the Shadow Glen condominium complex. Issakhani parked on the street after attempting, unsuccessfully, to find parking in the condominium complex. The complex had 170 onsite parking spaces, but only six were marked as “Visitor” spaces.

While crossing the street, Issakhani was struck by a car and sustained a traumatic brain injury along with several skull fractures.

Issakhani filed suit against the Association, alleging that her injuries were caused by the association’s failure to maintain the number of guest parking spaces mandated by an applicable city ordinance.

Result: The court held that the association did not owe the Issakhani a duty of care under either the ordinance or at common law. As a result, the association was not held liable for Issakhani’s damages.


Kracke v. City of Santa Barbara

(2021) 63 Cal. App. 5th 1089

Short-Term Vacation Rentals and Coastal Act Permits

Facts: The City of Santa Barbara began enforcing municipal code sections effectively prohibiting the operation of short-term vacation rentals in its coastal areas of the city. Due to proximity to the coastline, the Costal Act applied to actions by the city in these coastal areas. Any “development” in these areas would require a coastal development permit pursuant to the Coastal Act.

At issue was whether the city’s enforcement of these municipal code sections constituted a “development” for purposes of the Coastal Act.

Result: The court held that the city’s enforcement of these municipal code sections regarding short-term vacation rentals was a “development”, as defined in the Coastal Act. The city had not obtained a coastal development permit in conformance with Coastal Act requirements. As a result, the city’s municipal code prohibiting short-term vacation rentals was appropriately struck down.


Smart Corner Owners Association v. CJUF Smart Corner LLC

(2021) 64 Cal. App. 5th 439

Prelitigation Member Vote Requirements

Facts: Smart Corner Owners Association filed a construction defect lawsuit against CJUF Smart Corner LLC, but did not obtain prior approval from a majority of members before filing suit as was required by the association’s CC&Rs. As a result, a summary judgment motion was granted in favor of CJUF Smart Corner LLC.

While an appeal was pending, Civil Code Section 5986 as enacted, which rendered prelitigation member vote requirements null and void. The association argued that since the appeal was still pending, and no final judicial decision had been made, its claims were still not resolved, and Section 5986 would apply to remove the prelitigation member vote requirement. As a result, the association sought a reversal of the summary judgment motion against it.

Result: The court held that the statute applied in this case, because the statute did not encompass a judgment that was not final on appeal as of the statute’s effective date. In addition, the court found the member vote requirement in the CC&Rs to be a violation of public policy.