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California Law Updates

Terms in this set (48)

The committee's determination to award funds to a law enforcement agency MUST BE based on, but not be limited to:
The number of real estate fraud cases filed in the prior year;
The number of real estate fraud cases investigated in the prior year;
The number of victims involved in the cases filed; and
The total aggregated monetary loss suffered by victims. These victims include not only individuals, but also associations, institutions, or corporations, as a result of the real estate fraud cases filed, and those under active investigation by that law enforcement agency.

For each law enforcement agency that has already been awarded funds in the previous year, such agency must file a reapplication for funds to the committee in each successive year. In addition to the other information required, this agency must ALSO submit a FULL and detailed accounting of the funds received in the previous year, and how those funds were expended. This includes the AMOUNT of funds received and expended; the ways in which those funds were utilized, including the payment of salaries, expenses, equipment and supply purchases; and other expenditures categorized according to "type." This accounting must also detail the number of filed complaints, investigations, arrests, and convictions, and any other relevant information the committee reasonably requires.
The county board of supervisors must annually review the effectiveness of the district attorney in deterring, investigating, and prosecuting real estate fraud crimes. This review is to be based on information provided by the district attorney in an annual report that is submitted to the board and to the Legislative Analyst's Office, which must compile these results and report them to the Legislature. (The bold-faced text above is a new requirement that was recently added to Government Code Section 27388 (d).)
Legislature's intent in setting forth so many rules through its enactment of this section is to have an impact on real estate fraud involving the largest number of victims. Under this section, it has further been set forth that "to the extent possible," an emphasis should be placed on fraud against those individuals whose residences are in foreclosure, OR are in danger of foreclosure. Case filing decisions continue to be at the discretion of the prosecutor.
The Government Code also notes that a district attorney's office or a local enforcement agency that has undertaken investigations and prosecutions that will continue into the FOLLOWING program year is allowed to receive those funds from the previous fiscal year that were not previously spent. This is provided AFTER the annual report of information detailing the accounting of funds received and expended in the prior year has been submitted.
Under this law, NONE of the monies collected under this section may be used in ANY WAY to offset a reduction in ANY OTHER SOURCE of funds. Real Estate Fraud Prosecution Trust Fund monies MUST ONLY BE USED in connection with criminal investigations or prosecutions involving recorded real estate documents.
Many counties in California have already enacted laws within their county providing for the Real Estate Fraud Protection Trust Fund. You can find out if your county of real estate practice is one of those with a Real Estate Fraud Protection Trust Fund by checking with the county government or recorded legislation, or by searching online.
Civil Code Changes: The Unruh Civil Rights Act
Under the Civil Code, there have been several amendments to existing statutes. The first set of these changes concerns the Unruh Civil Rights Act. Previously, the Unruh Civil Rights Act protected people from being discriminated against because of their sex, race, color, religion, ancestry, national origin, disability, or medical condition. However, recent changes have added "marital status" and "sexual orientation" to the other classes protected under this legislation in California. Here is the updated version of this law, under the Civil Code:
51. (a) This section shall be known, and may be cited, as the Unruh Civil Rights Act.
(b) All persons within the jurisdiction of this state are free and equal, and no matter what their sex, race, color, religion, ancestry, national origin, disability, medical condition, marital status, or sexual orientation are entitled to the full and equal accommodations, advantages, facilities, privileges, or services in all business establishments of every kind whatsoever.
(c) This section shall not be construed to confer any right or privilege on a person that is conditioned or limited by law or that is applicable alike to persons of every sex, color, race, religion, ancestry, national origin, disability, medical condition, marital status, or sexual orientation.
(d) Nothing in this section shall be construed to require any construction, alteration, repair, structural or otherwise, or modification of any sort whatsoever, beyond that construction, alteration, repair, or modification that is otherwise required by other provisions of law, to any new or existing establishment, facility, building, improvement, or any other structure, nor shall anything in this section be construed to augment, restrict, or alter in any way the authority of the State Architect to require construction, alteration, repair, or modifications that the State Architect otherwise possesses pursuant to other laws."
This law has been altered to prohibit as a basis for discrimination either marital status, OR sexual orientation. Any text within this Civil Code section that prohibits discrimination based on the following reasons: sex, race, color, religion, ancestry, national origin, disability, or medical condition, will now have "marital status" and "sexual orientation" added to that list.
Amendments of Civil Code Section 53
Civil Code Section 53 has been amended as a result of the aforementioned changes to the Unruh Civil Rights Act, with the additions of "marital status" and "sexual orientation" to the list of those personal characteristics on which discrimination may NOT be based in California. Under Section 53, the specifics of written contracts or other agreements are the focus, including any written instrument OR any portion of any instrument, that is somehow used to discriminate against any of the parties protected by the Unruh Civil Rights Act - sex, race, color, religion, ancestry, national origin, disability, medical condition, marital status, or sexual orientation.
Here is the amended law in its most current form. The portions in bold font are those that have been added as of the most recent update.
53. (a) Every provision in a written instrument relating to real property that purports to forbid or restrict the conveyance, encumbrance, leasing, or mortgaging of that real property to any person because of any characteristic listed or defined in subdivision (b) or (e) of Section 51 is void, and every restriction or prohibition as to the use or occupation of real property because of any characteristic listed or defined in subdivision (b) or (e) of Section 51 is void.
(b) Every restriction or prohibition, whether by way of covenant, condition upon use or occupation, or upon transfer of title to real property, which restriction or prohibition directly or indirectly limits the acquisition, use or occupation of that property because of any characteristic listed or defined in subdivision (b) or (e) of Section 51 is void.
(c) In any action to declare that a restriction or prohibition specified in subdivision (a) or (b) is void, the court shall take judicial notice of the recorded instrument or instruments containing the prohibitions or restrictions in the same manner that it takes judicial notice of the matters listed in Section 452 of the Evidence Code.
The laws set forth in this section state, in essence, that any provision, restriction, prohibition, or other covenant that is placed within a contract, OR in any other manner, that takes any of the following actions based on the fact that a person is a certain sex, race, color, religion, ancestry, national origin, disability, and medical condition, is VOID because of this basis for discrimination. Such a restriction might include anything from an encumbrance, mortgage, lease, conveyance, or other acquisition of a property, and it might be placed through a conditional use restriction, a covenant, or with the transfer of title.
Notice of Intention - Airport in Vicinity and Other Mandates
The location of all existing airports, and of all proposed airports shown on the general plan of any city or county, located within two statute miles of the subdivision. Note that if the property is located within an airport influence area, the Notice of Intention must include the following statement: "NOTICE OF AIRPORT IN VICINITY This property is presently located in the vicinity of an airport, within what is known as an airport influence area. For that reason, the property may be subject to some of the annoyances or inconveniences associated with proximity to airport operations (for example: noise, vibration, or odors). Individual sensitivities to those annoyances can vary from person to person. You may wish to consider what airport annoyances, if any, are associated with the property before you complete your purchase and determine whether they are acceptable to you." (Note that an "airport influence area," or "airport referral area," as it is also known, is the area in which current or future airport-related noise, overflight, safety, or airspace protection factors may significantly affect land uses or necessitate restrictions on those uses as determined by an airport land use commission."
References to any soils and/or geologic report(s) that were prepared specifically for that subdivision, if applicable.
A statement regarding whether or not fill is used, or proposed to be used, within the subdivision, including a statement with the name and location of the public agency where the subdivision's soil condition information is available.
The subdivided lands public report Notice of Intent must, finally, include the following two final true statements:
A statement about any property located within the jurisdiction of the San Francisco Bay Conservation and Development Commission, which says that the property is so located. This must also include the following notice:
NOTICE OF SAN FRANCISCO BAY CONSERVATION AND DEVELOPMENT COMMISSION JURISDICTION
This property is located within the jurisdiction of the San Francisco Bay Conservation and Development Commission. Use and development of property within the commission's jurisdiction may be subject to special regulations, restrictions, and permit requirements. You may wish to investigate and determine whether they are acceptable to you and your intended use of the property before you complete your transaction.
Any other information that the owner, his or her agent, or the subdivider may desire to present.
Under the Civil Code, these terms are defined as follows:
Condominium project: "A development consisting of condominiums. A condominium consists of an undivided interest in common in a portion of real property coupled with a separate interest in space called a unit, the boundaries of which are described on a recorded final map, parcel map, or condominium plan in sufficient detail to locate all boundaries thereof. The area within these boundaries may be filled with air, earth, or water, or any combination thereof, and need not be physically attached to land except by easements for access and, if necessary, support. The description of the unit may refer to (1) boundaries described in the recorded final map, parcel map, or condominium plan, (2) physical boundaries, either in existence, or to be constructed, such as walls, floors, and ceilings of a structure or any portion thereof, (3) an entire structure containing one or more units, or (4) any combination thereof. The portion or portions of the real property held in undivided interest may be all of the real property, except for the separate interests, or may include a particular three-dimensional portion thereof, the boundaries of which are described on a recorded final map, parcel map, or condominium plan. The area within these boundaries may be filled with air, earth, or water, or any combination thereof, and need not be physically attached to land except by easements for access and, if necessary, support. An individual condominium within a condominium project may include, in addition, a separate interest in other portions of the real property."
Under Section 1365.2, the term "Association records" also refers to the following:
Membership lists, including name, property address, and mailing address, if the conditions set forth herein are met and except as otherwise provided. Keep in mind that the member requesting the list MUST state the purpose for which the list is requested, and this purpose must be considered "reasonably related" to the requester's interest as a member. (Note that under this section, if the association has reason to REASONABLY believe that the information in the list will be used for some other reason other than the one given by the member, it is within the association's authority to deny that request. Should the request be denied, in any subsequent action brought by the member under this section, it is the ASSOCIATION that will bear the burden of proof that the member would have allowed the requested information to be used in the wrong way. Any member of the association has the authority to opt out of the sharing of his name, property address, and mailing address by notifying the association in writing that he prefers to be contacted via an alternative process, and this opt-out condition will remain in effect until the member himself changes it. (For specifics of the "alternative process" of contact, check out subdivision (c) of Section 8330 of the Corporations Code); AND
Check registers.
There is another related term set forth under Civil Code Section 1365.2, concerning records. This term is "Enhanced association records," and is defined as "invoices, receipts and canceled checks for payments made by the association, purchase orders approved by the association, credit card statements for credit cards issued in the name of the association, statements for services rendered, and reimbursement requests submitted to the association, provided that the person submitting the reimbursement request shall be solely responsible for removing all personal identification information from the request."
On the following screen, we will look at another requirement set forth under this same bill, regarding the granting of exclusive use of a common interest development to one or more homeowners.
More CID Amendments
Another requirement set forth in the same bill requires that in order to grant the exclusive use of a common area to one or more owner, there must be a passing affirmative vote of 67% of the owners in a common interest development to grant this right of exclusive use to the member. (If the HOA of the common interest development requires a different percentage, then that percentage is acceptable under the law.) Note that there are some exceptions to this rule.
Under Senate Bill 61, homeowner associations (HOA) are required to hold elections for specific matters by use of a secret ballot. The secret ballot is to be used in the cases of elections regarding assessments, selection of members of the association board of directors, amendments to the governing documents, or the grant of exclusive use of common area property. This regulation prohibits the use of any funds of the HOA for the personal campaign mailings of any association official. The bill also prohibits any mass mailing, as defined, by an association official or candidate for campaign purposes within 60 days of any election of association officials. Senate Bill 61 requires that homeowner associations utilize an independent third party or parties as "inspector of elections." The number of inspectors of election may either be one or three. Under this law, an independent third party includes, but is not limited to, a volunteer poll worker with the county registrar of voters, a licensee of the California Board of Accountancy, or a notary public. This independent third party may be a member of the association, but MAY NOT be any of the following:
A member of the board of directors;
A candidate for the board of directors;
Related to a member of the board of directors;
A person who is currently employed by or under contract to the common interest development association, as required by specific rules of the association.
CID Assessments
Civil Code Section 1365.1 states that the homeowner association must distribute a written notice entitled, "NOTICE ASSESSMENTS AND FORECLOSURE" to EACH member of the common interest development association, and this must be distributed during the 60-day period IMMEDIATELY preceding the beginning of the association's fiscal year. The notice must be printed in at least 12-point font, and read exactly as follows. (A portion of this notice text will continue onto the following screen.)
"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 Section 1367.4 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 1366, 1367.1, and 1367.4 of the Civil Code) 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 areas damaged by a member or a member's guests, if the governing documents provide for this. (Sections 1366 and 1367.1 of the Civil Code)"
Notice Assessments and Foreclosure
This continues the text from the previous screen:
"The association must comply with the requirements of Section 1367.1 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 1367.1 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 1367.1 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 1367.1 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, he or she 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 1367.1 of the Civil Code) An owner may dispute an assessment debt by submitting a written request for dispute resolution to the association as set forth in Article 5 (commencing with Section 1368.810) of Chapter 4 of Title 6 of Division 2 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 2 (commencing with Section 1369.510) of Chapter 7 of Title 6 of Division 2 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 1367.1 of the Civil Code)
MEETINGS AND PAYMENT PLANS
An owner of a separate interest that is not a timeshare 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 exist. (Section 1367.1 of the Civil Code) The board of directors 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 to the payment plan standards of the association, if they exist. (Section 1367.1 of the Civil Code)"
Fiscal Responsibilities of the CID Association's Board of Directors
Civil Code Section 1365.5 sets forth the law regarding the fiscal responsibilities of the common interest development association's board of directors, which includes reviewing each of the following statements or reports:
On at least a quarterly basis, a current reconciliation of the association's operating accounts.
On at least a quarterly basis, the current year's actual reserve revenues and expenses compared to the current year budget.
On at least a quarterly basis, an income and expense statement for the CID association's operating and reserve accounts.
The latest account statements prepared by the financial institutions where the association has its operating and reserve accounts.
In order to withdraw money from the association's reserve accounts, the signatures of a minimum of 2 people are necessary. These 2 people must be EITHER association board of director members, OR, one must be a member of the association board of directors, and the other must be an officer who is NOT a member of the board of directors.
Under this section of the Civil Code, "reserve accounts" are defined as:
"(1) Moneys that the association's board of directors has identified for use to defray the future repair or replacement of, or additions to, those major components which the association is obligated to maintain;" OR
"(2) The funds received and not yet expended or disposed from either a compensatory damage award or settlement to an association from any person or entity for injuries to property, real or personal, arising from any construction or design defects. These funds shall be separately itemized from funds described in paragraph (1)."
Temporary Transfer or Special Assessment?
Under this section of the Civil Code, the board must NOT expend ANY FUNDS that have been designated as "reserve funds" UNLESS they are used for the repair, restoration, replacement, or maintenance of the major components that the association is responsible to repair, restore, replace, or maintain, as these items are the reason for the establishment of such a reserve fund.
However, in the case of a temporary transfer from the reserve fund, the board IS permitted to authorize this temporary transfer from the reserve fund into the general operating fund of the association, IF necessary to meet short-term cash flow needs or other expenses. In such a situation, the board must provide a notice of intent to consider the transfer. This notice must include the following:
Why the transfer is necessary;
The repayment options; and
Whether a special assessment might be considered for this need.
Transferred funds as described herein must be restored to the reserve account within one year of the date of the initial transfer, unless the board provides written notice and documentation showing that a delay in replacing these moneys would be in the best interest of the common interest development.
The board must take seriously its duty to exercise wise financial management in the maintenance of this reserve account. If necessary, the board has the authority to levy a special assessment, which is subject to those limitations in Section 1366. The board may, at its discretion, extend the date the payment on the special assessment is due. (However, keep in mind that even if the board does choose to extend the payment due date, this does NOT affect or prevent the board from pursuing any legal remedy to enforce the collection of that unpaid special assessment.)
Regular and Special Assessments
The association has the authority to levy regular and special assessments that are sufficient to perform its obligations. Specific regulations do exist for these assessments.
Annual increases in regular assessments for any fiscal year may NOT be imposed unless the board has complied with specific provisions as set forth under this act, OR has received a quorum (more than 50% of the association owners) approval of the owners.
The board must not impose a regular assessment that is more than 20% of the regular assessment for the association's preceding fiscal year.
The board must not impose special assessments that will be more than 5% of the budgeted gross expenses of the association for that fiscal year, unless there is a quorum affirmative vote of the owners.
Keep in mind that the board DOES NOT limit assessment increases that are necessary for emergency situations, as in any of the following situations:
(1) A court-ordered extraordinary expense;
(2) If a threat to personal safety is discovered on the property, an extraordinary expense deemed necessary to repair or maintain all or part of the common interest development for which the association is considered responsible; OR
(3) An extraordinary expense deemed necessary to repair or maintain all or part of the common interest development for which the association is responsible, when such an expense could not have been reasonably foreseen by the board when it prepared the pro forma operating budget
Before an assessment may be imposed or collected, however, the board must first pass a resolution stating their written findings regarding necessity of the extraordinary expense, and why this expense was not/could not have been reasonably foreseen in the budgeting process, and this resolution must be provided to the members along with the notice of assessment.
Any regular assessments that are imposed and collected to meet the association's obligation are exempt from execution by the association's judgment creditor only to the extent necessary for the association to perform essential services, such as paying for utilities and insurance. This exemption does NOT apply to any consensual pledges, liens, or encumbrances that have been approved by the owners of an association, OR to any lien for labor or materials supplied to the common area.
The following regulations also apply to the assessments:
The association must notify the owners of separate interests, between 30 and 60 days before the increased assessment is due (no more or no less), of this increased assessment by first-class mail.
Regular and special assessments are delinquent 15 days after they become due, unless the declaration provides a longer time period, in which case the longer time period shall apply. If an assessment is delinquent the association may recover all of the following:
Reasonable costs incurred in collecting the delinquent assessment, including reasonable attorney's fees.
A late charge not exceeding 10% of the delinquent assessment or $10.00, whichever is greater, with some exceptions.
Interest on all sums imposed under this section of the Civil Code, which include delinquent assessments, reasonable fees, collection costs, and reasonable attorney's fees, at an annual interest rate of not more than 12%, which begins 30 days after the assessment becomes due, unless the declaration specifically notes the interest recovery rate at a lower rate, in which case the lesser of the two amounts will apply.
Notice of Lien
If a common interest development association determines that a lien is to be recorded against the separate interest of an owner who has NOT paid the mandated regular or special assessment, then the association must notify the owner of this. The owner must be notified in writing, via certified mail, at least 30 days before such a lien is recorded. This notice must include the following:
A general description of the collection and lien enforcement procedures of the association, as well as how the amount was collected.


Collection of Delinquent Assessments
Civil Code Section 1367.4 - a new addition to the Civil Code - became operative on January 1, 2006.
Under Senate Bill 137, which is, in part, set forth under this section of the Civil Code, the procedures used for collecting delinquent assessments for certain debts - IF those debts come about ON OR AFTER July 1, 2006 - have been revised. The new law sets forth these amendments. The law states that when an association of a common interest development seeks to collect delinquent assessments that are LESS THAN $1,800.00, it may not foreclose on the lien unless it meets the set conditions. (Note that these "delinquent assessments" do not, under Civil Code Section 1367.4, include any of the following changes: accelerated assessments, late charges, fees, and costs of collection, attorney's fees, or interest.) Then the association must take one of two actions:
File a civil action in small claims court OR
Record a lien.
However, an association is NOT PERMITTED to foreclose on this lien UNTIL the amount equals or exceeds $1,800.00, OR UNTIL the assessments are more than 12 months delinquent.
A statement that this owner does have the legal right to inspect the association records.
The following statement in 14-point boldface type, if the notice is printed, or in capital letters, if the notice is typed:
"IMPORTANT NOTICE:
IF YOUR SEPARATE INTEREST IS PLACED IN FORECLOSURE BECAUSE YOU ARE BEHIND IN YOUR ASSESSMENTS, IT MAY BE SOLD WITHOUT COURT ACTION. "
An itemized statement of the charges owed by the owner. (This statement must include those items on the statement that show the amount of any delinquent assessments, the fees and reasonable costs of collection, reasonable attorney's fees, any late charges, and interest, if any.)
6. The right to request a meeting with the board as specified in this subdivision of the California Civil Code.
7. The right to dispute the assessment debt by submitting a written request for dispute resolution to the association under the association's "meet and confer" program, as previously discussed herein.
8. The right to request alternative dispute resolution with a neutral third party BEFORE the association may initiate foreclosure against the owner's separate interest, as previously discussed.
Under this section of the Civil Code, any payments made against this debt, by the owner of a separate interest, must be paid in a certain order. First, the payment must be applied toward the assessments owed. Once this assessment is paid in full, the payments will be applied to the fees, collection costs, attorney's fees, late charges, and interest. If an owner does make such a payment, the association must provide a receipt for the payment at the owner's request. This receipt must state the date of the payment, as well as the person who received the payment.
The common interest development association must provide a mailing address for members who wish to make an overnight payment of these assessments.
A designated member of the association must sign the notice of delinquent assets. A copy of the recorded notice of delinquent assessment must be sent via certified mail to every person whose name is shown as an owner of the separate interest in the association's records. Such notice must be mailed no later than 10 calendar days after the notice is recorded.
Within 21 days of the payment in full of the sums, the association must record or have the county recorder record specified in the notice of delinquent assessment, the association must record in the office of the county recorder in which the notice of delinquent assessment has been recorded a lien release OR notice of rescission. The association must then provide the owner with a copy of the lien release or the notice that the delinquent assessment has been satisfied.
Density Bonus Amendments and Lower Income Housing Units
The California Planning and Zoning Law requires that when a housing developer proposes a housing development within the jurisdiction of the local government, the city, county, or city and county provide the developer with a density bonus and other incentives or concessions for the production of lower income housing units OR the donation of land within the development if the developer meets certain requirements. These include a mandate that the developer construct a certain percentage of the total units to be designed ESPECIALLY for specified income households or qualifying residents.
Under Senate Bill 435, the state's density bonus law, which was previously implemented, must NOW be set forth in a manner that makes the law more easily understandable, so that it is more easily implemented and functional by applying the density bonus law to all forms of common interest developments.
Senate Bill 435 has amended these eligibility requirements to include the following:
The construction of a mobile home park that limits residency based on age requirements for housing for older persons; AND
The construction of a community apartment project and a stock cooperative for those people and families that have what is considered to be "moderate income."
The local administrative requirements imposed by these amendments impose a state-mandated local program.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state, and set forth the manner in which that reimbursement is to be made.
Housing Development Disapproval
The current version of Government Code Section 65589.5 requires that a local agency must NOT disapprove a housing development, including farmworker housing, for very low-, low-, or moderate-income households or condition approval, including through the use of design review standards, in a manner that renders the project infeasible for development for the use of very low-, low-, or moderate-income households unless it makes written findings (that must be based on substantial evidence in the record) as to one of the following:
The jurisdiction has adopted a housing element under this section that is in substantial compliance with this article, AND that jurisdiction has already met OR exceeded its share of the regional housing need allocation for the planned period, FOR that specific income category, as has been proposed for the housing development project, BUT ONLY IF any disapproval or conditional approval is NOT based on any of the reasons prohibited by Title 7, Section 65008, of the Government Code, which is entitled, "Planning and Land Use." These reasons include the following: race, sex, color, religion, ethnicity, national origin, ancestry, lawful occupation, familial status, disability, or the age of the individuals OR group of individuals. (Note: If the housing development project includes a mix of income categories, and the jurisdiction has not met or exceeded its share of the regional housing need for one or more of those categories, then this paragraph may NOT be used to either disapprove or conditionally approve the project. The share of regional housing need met is to be calculated in accordance with the forms and definitions that may be adopted by the Department of Housing and Community Development.)
The development project as it has been proposed would have a specific, adverse impact upon the public health or safety, if there is no feasible way to mitigate that specific impact in a manner that is both satisfactory AND will not cost so much to mitigate that it renders the development too expensive to serve as housing for low- and moderate-income households. (As used herein, a "specific, adverse impact" is defined under this section as a "significant, quantifiable, direct, and unavoidable impact, based on objective, identified written public health or safety standards, policies, or conditions as they existed on the date the application was deemed complete." Note that inconsistency with the zoning ordinance OR general plan land use designation does NOT qualify as having a "specific, adverse impact upon the public health or safety.)
Remember that, as stated on the previous screen, a local agency must NOT disapprove a housing development for very low, low-, or moderate-income households or condition the approval of such development in a manner that makes the project infeasible for its development for the use of very low-, low-, or moderate-income households unless it makes written findings (that must be based on substantial evidence in the record), as to one of the following:
3. That the denial of the project or imposition of conditions is required, because the project must comply with specific state or federal law, and such compliance will be too costly, rendering that development unaffordable to low- and moderate-income households.
4. That the development project has been proposed on a land that has been zoned for agriculture or resource preservation, IF:

That land is surrounded on at least 2 sides by land already being used for these same purposes (agricultural or resource preservation); OR
That land does not have the necessary adequate water or wastewater facilities to serve the development project.
5. That the development project is shown to be inconsistent with both the jurisdiction's zoning ordinance and general plan land use designation, which is specified in an element of the general plan as it existed on the date the application was deemed complete, IF this jurisdiction has, SINCE THAT DATE, adopted a revised housing element.
More Housing Development Projects
Note that the regulations we've discussed herein must NOT be used as a means of disapproving OR conditionally approving a housing development project if the development project is proposed on a site that is identified as suitable or available for very low-, low-, or moderate-income households in the jurisdiction's housing element, and consistent with the density specified in the housing element, even though it is inconsistent with both the jurisdiction's zoning ordinance and general plan land use designation.
If the local agency has failed to identify in its land any sites that can be developed for housing within the planning period AND that are sufficient to provide for the jurisdiction's share of the regional housing need for all income levels, then this law may NOT to be used to disapprove or conditionally approve a housing development project. This applies in the case of a housing project proposed for a site that has been designated in any element of the general plan for residential uses or designated in any element of the general plan for commercial uses if residential uses are permitted or conditionally permitted within commercial designations. Regarding any court action, the local agency bears the burden of proof to SHOW that its housing element does identify adequate sites with appropriate zoning and development standards and with services and facilities to accommodate the local agency's share of the regional housing need for the very low- and low-income categories.
This section of law must not be construed to relieve a local agency from complying with the Congestion Management Program or the California Environmental Quality Act. Nor does this section in any way prohibit a local agency from requiring that the development project comply with objective, quantifiable, written development standards, conditions and policies appropriate to, and consistent with, meeting the jurisdiction's share of the regional housing need.
Note that this section of the Government Code applies to charter cities (in addition to other established areas), because of the Legislature's determination that the lack of housing is a "critical statewide problem."
Housing Development Terms Defined
Under this section, the following definitions have been set forth for the terms used herein:
Feasible: "Capable of being accomplished in a successful manner within a reasonable period of time, taking into account economic, environmental, social, and technological factors."
Housing Development Project: "A use consisting of either of the following:
Residential units only OR
Mixed-use developments consisting of residential and nonresidential uses in which nonresidential uses are limited to neighborhood commercial uses and to the first floor of buildings that are two or more stories. As used in this paragraph, "neighborhood commercial" means small-scale general or specialty stores that furnish goods and services primarily to residents of the neighborhood."
Housing for Very Low-, Low-, or Moderate-Income Households: "Either (A) at least 20 percent of the total units shall be sold or rented to lower income households, as defined in Section 50079.5 of the Health and Safety Code, OR (B) 100 percent of the units shall be sold or rented to moderate-income households as defined in Section 50093 of the Health and Safety Code, or middle-income households, as defined in Section 65008 of this code. Housing units targeted for lower income households shall be made available at a monthly housing cost that does not exceed 30% to 60% of area median income with adjustments for household size made in accordance with the adjustment factors on which the lower income eligibility limits are based. Housing units targeted for persons and families of moderate income shall be made available at a monthly housing cost that does not exceed 30% of 100% of area median income with adjustments for household size made in accordance with the adjustment factors on which the moderate income eligibility limits are based."
Area Median Income: "Area median income as periodically established by the Department of Housing and Community Development pursuant to Section 50093 of the Health and Safety Code. The developer shall provide sufficient legal commitments to ensure continued availability of units for very low- or low-income households in accordance with the provisions of this subdivision for 30 years."
Neighborhood: "A planning area commonly identified in a community's planning documents, and identified as a neighborhood by the individuals residing and working within the neighborhood."
Eligibility for Court Action
The current version of Government Code Section 65589.5, as amended under Senate Bill 575, expressly authorizes the applicant for the housing development project OR any person who would be eligible to apply for residency in that project to bring an action in court pursuant to specified provisions and would also authorize the court to vacate the decision of the local agency, as specified, deem the application complete, and impose fines pursuant to specified procedures if the court finds that the local agency acted in bad faith and failed to carry out the court's order or judgment within the 60-day period. The bill would also specify procedures for appeal of the court's order.
Under Senate Bill 326, the previous law set forth under "Rental Housing and Government Code" stated that low and moderate rental housing developments that consisted of 100 units OR LESS could NOT be denied a permit, provided that these housing developments followed the regulations set forth under local government development standards. In addition, the housing development was required to receive either a negative declaration, OR a mitigated declaration, as set forth under the California Environmental Quality Act.
The newest amendment to this law, which became effective January 1, 2006, has expanded the coverage of this law, as you read on the preceding screens. Currently, this law also applies to duplexes, triplexes and fourplexes, and it expands the law to charter cities, as well.
Real Property Sale Foreclosures
Beginning with Civil Code Section 2924, the topic of nonjudicial foreclosure sales for mortgages is set forth. The following sections regulate the various aspect of such nonjudicial foreclosure sales under either mortgages and Under Civil Code Section 2924 (b), the law is set forth regarding mortgages - and in particular, the topics of notice of default or sale. This law requires a person recording a notice of default OR a notice of sale, under any deed of trust or mortgage, with power of sale, to perform specified actions. Under Assembly Bill 885, this law has been modified to include an amended definition of the term, "last known address" under this provision.
Let's take a look at this particular portion of Civil Code Section 2924 (b), as follows:
2924b. (a) Any person desiring a copy of any notice of default and of any notice of sale under any deed of trust or mortgage with power of sale upon real property or an estate for years therein, as to which deed of trust or mortgage the power of sale cannot be exercised until these notices are given for the time and in the manner provided in Section 2924 may, at any time subsequent to recordation of the deed of trust or mortgage and prior to recordation of notice of default thereunder, cause to be filed for record in the office of the recorder of any county in which any part or parcel of the real property is situated, a duly acknowledged request for a copy of the notice of default and of sale. This request shall be signed and acknowledged by the person making the request, specifying the name and address of the person to whom the notice is to be mailed, shall identify the deed of trust or mortgage by stating the names of the parties thereto, the date of recordation thereof, and the book and page where the deed of trust or mortgage is recorded or the recorder's number, and shall be in substantially the following form:
"In accordance with Section 2924b, Civil Code, request is hereby made that a copy of any notice of default and a copy of any notice of sale under the deed of trust (or mortgage) recorded ______, ____, in Book_____ page ____ records of ____ County, (or filed for record with recorder's serial number ____, _______County) California, executed by ____ as trustor (or mortgagor) in which ________ is named as beneficiary (or mortgagee) and ______________ as trustee be mailed to _________________ at ____________________________. ( Name, Address)
NOTICE: A copy of any notice of default and of any notice of sale will be sent only to the address contained in this recorded request. If your address changes, a new request must be recorded.
Signature _________________"
Upon the filing for record of the request, the recorder shall index in the general index of grantors the names of the trustors (or mortgagor) recited therein and the names of persons requesting copies.
Recording a Notice of Default or a Notice of Sale
The mortgagee, trustee, or other person who is authorized to record a notice of default or notice of sale must perform each of the following tasks:
Within 10 business days following the aforementioned recording, either deposit or cause to be deposited in the United States mail an envelope to be sent via registered or certified mail with the postage prepaid. This envelope must include the following:
A copy of the notice with the recording date shown, addressed to each person whose name and address are set forth in a duly recorded request and sent to the address that has been designated in the request AND to each trustor or mortgagor at his or her last known address if that last known address is different than the address specified in the deed of trust or mortgage with power of sale.
At least 20 days before the date of sale, deposit or cause to be deposited in the United States mail an envelope, sent by registered or certified mail with postage prepaid, containing a copy of the notice of the time and place of sale, addressed to each person whose name and address are set forth in a duly recorded request for such, and directed to the address designated in the request and to each trustor or mortgagor at his or her last known address if different than the address specified in the deed of trust or mortgage with power of sale.
Now, here is where the latest amendment under Assembly Bill 885 comes into play, regarding the above term, "last known address," which has since been revised. According to the current version of Civil Code Section 2924b, the "last known address" of each trustor or mortgagor is defined to mean "the last business or residence physical address actually known by the mortgagee, beneficiary, trustee, or other person authorized to record the notice of default. For the purposes of this subdivision, an address is "actually known" if it is contained in the original deed of trust or mortgage, or in any subsequent written notification of a change of physical address from the trustor or mortgagor pursuant to the deed of trust or mortgage. For the purposes of this subdivision, "physical address" does not include an e-mail or any form of electronic address for a trustor or mortgagor. The beneficiary shall inform the trustee of the trustor's last address actually known by the beneficiary. However, the trustee shall incur no liability for failing to send any notice to the last address unless the trustee has actual knowledge of it."
The California Finance Lenders Law sets forth the requirements for the licensing and the regulation of finance lenders by the Commissioner of Corporations.
Finance Code Sections 22102, 22103, 22109, and 22153, which address the finance lender application requirements and the denial of such applications, have been amended by Assembly Bill 1419, which became effective January 1, 2006. The current regulations that have been enacted include the following:
Any licensee under this law who wishes to operate at an additional location may file a short form license application. This law authorizes such licensee to operate at that new location 10 days after the date of mailing the application.
The Commissioner is required to investigate any person responsible for the conduct of the lending activities of a licensure applicant; the law also authorizes the Commissioner to deny an application based on the unlawful activities of that person.
Since the bill specifies additional requirements under the California Finance Lenders Law - the violation of which is a CRIME -- then a state-mandated local program is to be imposed.

Senate Bill 36 (SB 36), which was signed into law in October 2009, was enacted in order to bring California into compliance with the federal Secure and Fair Enforcement Mortgage License Act (SAFE Act) of the Housing and Economic Recovery Act of 2008 (Public Law 110-289). Since December 31, 2009, new SB 36 requirements for those intending to engage in mortgage loan activities have been in effect.
Pursuant to SB 36, B&P Section 10166.02, Real estate brokers who make, arrange, or service loans secured by real property and any salespersons who act in a similar capacity under the supervision of a broker must submit a report, Mortgage Loan Activity Notification (RE 866), to the Department by January 31, 2010 or within 30 days of commencing the activity, whichever is later. The report must be completed on-line after January 1, 2010. This means that each licensed broker, licensed real estate corporation and licensed salesperson who conducts mortgage loan activities as described below must submit a report.
Licensees will provide identifying information, including their name and real estate license number. If the licensee is a real estate corporation, then the name and license number of the designated officer will also be provided. The notification will identify the mortgage loan activities being performed as well as any mortgage loan originator activities.
Penalty fees apply for failure to submit this required notification. Penalties are fifty dollars ($50) per day for the first 30 days the report is not filed and one hundred dollars ($100) per day for every day thereafter for a maximum of $10,000
Residential Insurance Amendment
Insurance Code 10103.5 sets forth the California Residential Property Insurance Bill of Rights, which must accompany the California Residential Property Insurance Disclosure when the insurer provides the latter. This law sets forth the regulations concerning the manner in which insurers maintain the information related to adverse underwriting decisions. Under Assembly Bill 1640, this section of the Insurance Code - 10103.5 - has been amended.
As another result of Assembly Bill 1640, Insurance Code Section 791.28 has been added to the Insurance Code. Both changes are operative on July 1, 2006. Insurance Code Section 791.28 states that any insurer under a personal lines residential property insurance policy, if it reports the claims history or loss experience of insureds under those policies to an insurance-support organization, must provide a specific disclosure to the insured party at the time that it provides the disclosure required under Section 790.034 (b) (1). This additional disclosure is set forth as follows:
"This insurer reports claim information to one or more claims information databases. The claim information is used to furnish loss history reports to insurers. If you are interested in obtaining a report from a claims information database, you may do so by contacting:
(Insert the name, toll-free telephone number, and, if applicable, Internet Web site address of each claims information database to which the insurer reports the information covered by this section.)"
327.5. Notwithstanding any other provision of law, the assessor shall not assign any parcel numbers or prepare a separate assessment or separate valuation to divide any existing residential structure into a subdivision, as defined in Section 66424 of the Government Code, until a subdivision final map or parcel map, as described in Sections 66434 and 66445, respectively, of the Government Code has been recorded as required by law. If the requirement for a parcel map is waived pursuant to subdivision (b) of Section 66428 of the Government Code, then the assessor shall not assign any parcel numbers or prepare a separate assessment or separate valuation, unless the applicant provides a copy of the finding made by the legislative body or advisory agency, as required by that subdivision.
Note that the term "subdivision" is defined under Government Code Section 66424 (the Subdivision Map Act), as referenced above, to mean "the division, by any subdivider, of any unit or units of improved or unimproved land, or any portion thereof, shown on the latest equalized county assessment roll as a unit or as contiguous units, for the purpose of sale, lease or financing, whether immediate or future. Property shall be considered as contiguous units, even if it is separated by roads, streets, utility easement or railroad rights-of-way."
Under this definition, the term "subdivision" includes all of the following: A condominium project, a community apartment project, or the conversion of five or more existing dwelling units to a stock cooperative.