CIVIL CODE
SECTION 5800-5865
CIVIL CODE
SECTION 5800-5810
5800. (a) A volunteer officer or volunteer director of an
association that manages a common interest development that is
exclusively residential, shall not be personally liable in excess of
the coverage of insurance specified in paragraph (4) to any person
who suffers injury, including, but not limited to, bodily injury,
emotional distress, wrongful death, or property damage or loss as a
result of the tortious act or omission of the volunteer officer or
volunteer director if all of the following criteria are met:
(1) The act or omission was performed within the scope of the
officer's or director's association duties.
(2) The act or omission was performed in good faith.
(3) The act or omission was not willful, wanton, or grossly
negligent.
(4) The association maintained and had in effect at the time the
act or omission occurred and at the time a claim is made one or more
policies of insurance that shall include coverage for (A) general
liability of the association and (B) individual liability of officers
and directors of the association for negligent acts or omissions in
that capacity; provided that both types of coverage are in the
following minimum amounts:
(A) At least five hundred thousand dollars ($500,000) if the
common interest development consists of 100 or fewer separate
interests.
(B) At least one million dollars ($1,000,000) if the common
interest development consists of more than 100 separate interests.
(b) The payment of actual expenses incurred by a director or
officer in the execution of the duties of that position does not
affect the director's or officer's status as a volunteer within the
meaning of this section.
(c) An officer or director who at the time of the act or omission
was a declarant, or who received either direct or indirect
compensation as an employee from the declarant, or from a financial
institution that purchased a separate interest at a judicial or
nonjudicial foreclosure of a mortgage or deed of trust on real
property, is not a volunteer for the purposes of this section.
(d) Nothing in this section shall be construed to limit the
liability of the association for its negligent act or omission or for
any negligent act or omission of an officer or director of the
association.
(e) This section shall only apply to a volunteer officer or
director who is a tenant of a separate interest in the common
interest development or is an owner of no more than two separate
interests in the common interest development.
(f) (1) For purposes of paragraph (1) of subdivision (a), the
scope of the officer's or director's association duties shall
include, but shall not be limited to, both of the following
decisions:
(A) Whether to conduct an investigation of the common interest
development for latent deficiencies prior to the expiration of the
applicable statute of limitations.
(B) Whether to commence a civil action against the builder for
defects in design or construction.
(2) It is the intent of the Legislature that this section clarify
the scope of association duties to which the protections against
personal liability in this section apply. It is not the intent of the
Legislature that these clarifications be construed to expand, or
limit, the fiduciary duties owed by the directors or officers.
5805. (a) It is the intent of the Legislature to offer civil
liability protection to owners of the separate interests in a common
interest development that have common area owned in tenancy-in-common
if the association carries a certain level of prescribed insurance
that covers a cause of action in tort.
(b) Any cause of action in tort against any owner of a separate
interest arising solely by reason of an ownership interest as a
tenant-in-common in the common area of a common interest development
shall be brought only against the association and not against the
individual owners of the separate interests, if both of the insurance
requirements in paragraphs (1) and (2) are met:
(1) The association maintained and has in effect for this cause of
action, one or more policies of insurance that include coverage for
general liability of the association.
(2) The coverage described in paragraph (1) is in the following
minimum amounts:
(A) At least two million dollars ($2,000,000) if the common
interest development consists of 100 or fewer separate interests.
(B) At least three million dollars ($3,000,000) if the common
interest development consists of more than 100 separate interests.
5810. The association shall, as soon as reasonably practicable,
provide individual notice pursuant to Section 4040 to all members if
any of the policies described in the annual budget report pursuant to
Section 5300 have lapsed, been canceled, and are not immediately
renewed, restored, or replaced, or if there is a significant change,
such as a reduction in coverage or limits or an increase in the
deductible, as to any of those policies. If the association receives
any notice of nonrenewal of a policy described in the annual budget
report pursuant to Section 5300, the association shall immediately
notify its members if replacement coverage will not be in effect by
the date the existing coverage will lapse.
CIVIL CODE
SECTION 5850-5865
5850. (a) If an association adopts or has adopted a policy imposing
any monetary penalty, including any fee, on any association member
for a violation of the governing documents, including any monetary
penalty relating to the activities of a guest or tenant of the
member, the board shall adopt and distribute to each member, in the
annual policy statement prepared pursuant to Section 5310, a schedule
of the monetary penalties that may be assessed for those violations,
which shall be in accordance with authorization for member
discipline contained in the governing documents.
(b) Any new or revised monetary penalty that is adopted after
complying with subdivision (a) may be included in a supplement that
is delivered to the members individually, pursuant to Section 4040.
(c) A monetary penalty for a violation of the governing documents
shall not exceed the monetary penalty stated in the schedule of
monetary penalties or supplement that is in effect at the time of the
violation.
(d) An association shall provide a copy of the most recently
distributed schedule of monetary penalties, along with any applicable
supplements to that schedule, to any member upon request.
5855. (a) When the board is to meet to consider or impose
discipline upon a member, or to impose a monetary charge as a means
of reimbursing the association for costs incurred by the association
in the repair of damage to common area and facilities caused by a
member or the member's guest or tenant, the board shall notify the
member in writing, by either personal delivery or individual delivery
pursuant to Section 4040, at least 10 days prior to the meeting.
(b) The notification shall contain, at a minimum, the date, time,
and place of the meeting, the nature of the alleged violation for
which a member may be disciplined or the nature of the damage to the
common area and facilities for which a monetary charge may be
imposed, and a statement that the member has a right to attend and
may address the board at the meeting. The board shall meet in
executive session if requested by the member.
(c) If the board imposes discipline on a member or imposes a
monetary charge on the member for damage to the common area and
facilities, the board shall provide the member a written notification
of the decision, by either personal delivery or individual delivery
pursuant to Section 4040, within 15 days following the action.
(d) A disciplinary action or the imposition of a monetary charge
for damage to the common area shall not be effective against a member
unless the board fulfills the requirements of this section.
5865. Nothing in Section 5850 or 5855 shall be construed to create,
expand, or reduce the authority of the board to impose monetary
penalties on a member for a violation of the governing documents.