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]]>The Open Meeting Act is a law that requires homeowner associations to hold open meetings and allow the members to speak publicly at those meetings. HOA boards have broad powers to affect large numbers of individuals through their decisions and actions. Hence, the Open Meeting Act requires open governance meetings, with notice, agenda and minutes requirements, and strictly limit closed executive sessions. These provisions parallel California’s open meeting laws regulating government officials, agencies and boards.
The Davis-Sterling Open Meeting Act is found in California Civil Code sections 4900 through 4955.
If they are, they are in violation of the law. HOAs are required to hold a board meeting before taking action on an item of business.
A board meeting is a “congregation, at the same time and place, of a sufficient number of directors to establish a quorum of the board, to hear, discuss, or deliberate upon any item of business that is within the authority of the board.”
In other words, a board meeting is a gathering of a quorum of board members to discuss board business.
An item of business is “any action within the authority of the board, except those actions that the board has validly delegated to any other person or persons, managing agent, officer of the association, or committee of the board comprising less than a quorum of the board.”
Simply stated, if the board can take action on something, it’s an item of business.
Authority: California Civil Code section 4910
In general, e-mail meetings are not allowed. More specifically, “the board shall not conduct a meeting via a series of electronic transmissions, including, but not limited to, electronic mail.” This includes the use of text messages and instant messaging services like Facebook Messenger and WhatsApp.
Emergency meetings are the exception to this rule, but only if certain procedures are followed:
Authority: California Civil Code section 4910
Except for emergency meetings, HOA boards must provide notice of the time and place of a meeting at least four days before the meeting. If the meeting is an executive session, the board must provide two days’ notice of the meeting. If the governing documents (by laws and CC&Rs) require longer notice, then the HOA must provide that longer notice.
Meeting notices must also include an agenda that lists items to be discussed.
Authority: California Civil Code section 4920
An emergency meeting is a meeting that requires immediate attention. Emergency meetings do not need to comply with standard notice and agenda requirements.
An HOA board may hold an emergency meeting
An emergency meeting may be called by the president or by any two directors other than the president.
Authority: California Civil Code section 4923
HOA boards are required to provide meeting notices and agendas by general delivery. General delivery means that the board can post the notice and agenda in a prominent location if the location has been designated for the posting of general notices by the association in the annual policy statement. General delivery also means that the board can include notices and agendas in billing statements or newsletters.
If you would like individual delivery, it’s your right to ask for it and to receive it. With individual delivery, the board must send you the notice and agenda by mail, or by e-mail if you consent.
Authority: California Civil Code sections 4920, 4040, and 4045
All homeowners have a right to attend board meetings unless the meeting is an executive session meeting. If the meeting is held by phone, homeowners have the right to listen in.
Authority: California Civil Code section 4925
Homeowners have the right to speak at board meetings, except for executive session meetings. The board must establish a reasonable time limit for all homeowners to speak. There does not need to be an agenda item such as “homeowners forum” or similar. If you want to speak at a meeting, you have the right to do so.
Authority: California Civil Code section 4925
As a general rule, an HOA board cannot discuss or take action on items that are not on the meeting’s agenda, unless the meeting is an emergency meeting.
Directors may, however, briefly respond to statements made or questions asked by homeowners speaking at the meeting. Directors may also ask a question for clarification, make a brief announcement, or make a brief report on their own activities, whether in response to questions posed by a homeowner or based upon their own initiative. Further, directors may give administrative direction to managers or staff and may take action on items not on the agenda in an emergency or other exigent situations.
Authority: California Civil Code section 4930
An HOA board may meet in executive session to discuss litigation, matters related to the formation of contracts with third parties, member discipline, personnel matters, or to meet with a homeowner about a payment of assessments. An HOA must meet in executive session to discuss matters pertaining to member discipline, payment plans for delinquent assessments, and whether to foreclose on an assessment lien.
The Civil Code provisions that require HOA boards to hold open meetings and to allow members to speak publicly at them reflect the California Legislature’s recognition that such boards possess broad powers to affect large numbers of individuals through their decisions and actions. These provisions parallel California’s open meeting laws regulating government officials, agencies and boards. Both statutory schemes mandate open governance meetings, with notice, agenda and minutes requirements, and strictly limit closed executive sessions.
Authority: California Civil Code section 4935
If you request meeting minutes, your HOA must let you have them.
The minutes, minutes proposed for adoption that are marked to indicate draft status, or a summary of the minutes, of any board meeting, other than an executive session, shall be available to members within 30 days of the meeting. The minutes, proposed minutes, or summary minutes shall be distributed to any member upon request and upon reimbursement of the association’s costs for making that distribution.
Authority: California Civil Code section 4950
Now, let’s put this all together into what a hypothetical legal action might look like.
Let’s start with a brief case study. Can you spot all of the Open Meeting Act violations?
The Board of Directors of the Acme Homeowners Association consists of five members: Robert, Ping, Evelyn, Sally, and Lucy. Acme’s by laws define a quorum as a majority of the board. In this case, a majority of the board is three board members.
Robert is the HOA president and is concerned about increasing reserves and rising management costs. Robert emails Ping and Evelyn about these matters. Ping “replies all” and adds to the discussion.
Robert is aware of the Open Meeting Act rules around e-mail meetings, so he schedules an executive session meeting two days out and posts a notice and agenda on the community bulletin board. Robert feels that the executive session will fix the e-mail meeting violation.
About 15% of the homeowners of Acme have requested to be e-mailed copies of meeting notices. Robert does not send the agenda to his property manager. As a result, homeowners do not receive an e-mailed copy of the agenda.
Robert’s executive session agenda contains these items:
On the meeting date, Robert and the rest of the board meet in executive session to discuss reserve funding and property manager costs. Because it is an executive session, homeowners are not permitted to attend.
Did you find the violations? There are at least ten of them.
Violation 1: E-mail meetings. Robert and Ping violated the Open Meeting Act by conducting an e-mail meeting. Robert’s scheduling of an executive session does not fix the e-mail meeting violation.
Violation 2: Failure to provide notice of meeting. A meeting notice and agenda were not posted prior to the e-mail meeting. Therefore, the notice and agenda requirements have been violated.
Violation 3: Discussing items of business not on an agenda. Since the meeting occurred by e-mail without an agenda, all discussions were discussion of items of business not on the agenda.
Violation 4: Excluding homeowners from meetings. The meeting occurred by e-mail and because of this, homeowners were necessarily excluded.
Violation 5: Not permitting homeowners to speak at meetings. Since the meeting occurred by e-mail, homeowners could not speak.
Violation 6: Meeting minutes not available. It’s highly improbably that Acme’s Board would prepare meeting minutes, especially since there was no agenda.
Violation 7: Failure to give individual notice. Here, about 15% of the homeowners requested individual notice but did not receive it.
Violation 8: Conducting executive session meetings on topics inappropriate for an executive session. Executive sessions are strictly limited to a handful of certain topics. Reserve funding and property manager costs are not appropriate topics to be discuss in an executive session.
Violation 9: Excluding homeowners from meetings. The meeting took the form of an executive session closed to homeowners. As a result, homeowners were excluded from the meeting.
Violation 10: Not permitting homeowners to speak at meetings. Since the meeting was a closed executive session, homeowners could not speak.
Section 4955 of the California Civil Code says that
A member of an association may bring a civil action for declaratory or equitable relief for a violation of this article by the association, including, but not limited to, injunctive relief, restitution, or a combination thereof, within one year of the date the cause of action accrues.
A member who prevails in a civil action to enforce the member’s rights pursuant to this article shall be entitled to reasonable attorney’s fees and court costs, and the court may impose a civil penalty of up to five hundred dollars ($500) for each violation, except that each identical violation shall be subject to only one penalty if the violation affects each member equally. A prevailing association shall not recover any costs, unless the court finds the action to be frivolous, unreasonable, or without foundation.
This means that if you sue and win, you can make the board stop their violations, get up to $500 per violation and your HOA will have to pay your attorney’s fees and court costs. Keep in mind that nothing is guaranteed.
The process can take many forms, including sending demand letters describing the HOA’s violations and the amount of money you want in return, following HOA internal dispute resolution procedures, going into alternative dispute resolution, and then when those attempts at resolving the dispute fail, filing a lawsuit.
The one mandatory requirement, however, is California Civil Code section 5930’s requirement that you engage in alternative dispute resolution (ADR), such as a mediation, before you file a lawsuit, unless it is a small claims lawsuit or the dispute is an assessment dispute:
An association or a member may not file an enforcement action in the superior court unless the parties have endeavored to submit their dispute to alternative dispute resolution pursuant to this article.
This section applies only to an enforcement action that is solely for declaratory, injunctive, or writ relief, or for that relief in conjunction with a claim for monetary damages not in excess of the jurisdictional limits stated in Sections 116.220 and 116.221 of the Code of Civil Procedure.
This section does not apply to a small claims action.
Except as otherwise provided by law, this section does not apply to an assessment dispute.
At the mediation, you or your attorney and the HOAs attorney will attempt to negotiate a settlement with the assistance of a mediator. If the mediation is unsuccessful, you can either do nothing or continue the process, which is filing a lawsuit.
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]]>The post Benitez v. Wilbur, 2008 U.S. Dist. LEXIS 15018 appeared first on The McMillan Law Firm, APC..
]]>The District Court pointed out that the PAGA does not contain any statutory language which requires the “representative action” to be brought as a class action. The Court then distinguished a “representative” action from a “class action,” noting, “while every class action is a representative action, the converse is not the case.” (Salton City ect. Owner Assn. v. M. Penn Philips Co. 75 Cal. App. 3d 184, 191 (1977.) “In either instance, however, justification for the procedural devie whereby one may sue for the benefit of many rests on considerations of necessity, convenience, and justice.” (Id. at 191). The Court also noted that, from the Court’s research, the cases imply that the class action is the norm as, “all PAGA cases have been brought as class actions, and not as individual claims.”
The Court also discusses how Defendants argument regarding issues of Due Process has merit if a class action is not required under the PAGA. The Court acknowledged that “absent a class action mechanism under PAGA, a defendant could win against a named plaintiff and then face additional suits by other employees similarly situated.” The Court further declared that, “A class action lawsuit pursuant to the PAGA would guard against such potential violations of due process…would bind all potential class members to the adjudication of the civil penalties.” The Court further stated that requiring class action lawsuits under the PAGA would benefit the judicial system, “by eliminating repetitious litigation and providing a method of method of obtaining redress for claims too small to warrant litigation on their own.” Finally, the Court held that it was of their opinion that the California Supreme Court will interpret PAGA as requiring a class action.
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]]>The post Class Certification Decision Overruled In Part And Affirmed In Part As To Truck Driver’s Claim For Unpaid Overtime And Meal Breaks. appeared first on The McMillan Law Firm, APC..
]]>Trial court did not abuse discretion in denying class certification with respect to claim that employees were required to work “off the clock” where there was no way to determine which members of the proposed class had actually worked off the clock. Trial court did not abuse discretion in denying class certification with respect to claim for compensation for denial of meal and rest breaks where evidence indicated that some employees were permitted to take and did take meal and rest breaks while others did not, there was no way of determining which drivers were permitted to take breaks and which were not, and there was no evidence of a company wide policy denying breaks.
Trial court abused discretion in denying class certification with regard to claims for vacation pay where a common legal question—the legality of employer’s policy of paying all employees a specific amount of weekly vacation pay without regard to their usual wage or the number of hours worked during the year—predominated over any individual issues, and the class was readily ascertainable since it would consist of all current drivers and all former drivers with timely claims. Trial court erred in ruling that class certification was not a superior means of adjudicating disputes regarding overtime pay and vacation pay where ruling was based solely on the amount of money potentially recoverable in individual actions and the availability of an administrative remedy through the Labor Commissioner.
The opinion is interesting because the overtime claim appears to involve a lot of individual issues regarding whether each truck driver was exempt under federal or state exemptions for truckers. But the court found no substantial evidence of individual issues.
The vacation claim is interesting because the plaintiffs should not win on the merits, because the trucking company’s policy of paying a flat sum of vacation pay (rather than basing it on the plaintiffs’ actual pay, is probably quite legal. So, class certification may be a hollow victory, since the defendant can bring a motion for summary judgment.
The meal period claim should warm the hearts of defense attorneys. The court had no trouble finding there substantial evidence of individual issues regarding whether and to what extent employees took meal breaks. There was no argument over whether they must be affirmatively “provided” or forced.
There was also a claim for off-the-clock work, for which certification was denied. Again, the court of appeal found substantial evidence that individual issues predominate.
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]]>The post Park Ranger Is Denied Personal Injury Claim Under The Labor Code For Injury That Occurred Off Duty. appeared first on The McMillan Law Firm, APC..
]]>This case arises from a park ranger Marck Vaught and his wife Maria’s claim arising from Marck Vaught’s slip and fall inside his Park Ranger residence due to a dangerous condition. Judge Jan I. Goldsmith of the El Cajon Superior Court granted the State of California summary judgment against the Vaught’s. In denying Marck and Maria Vaught’s claim for personal injuries, the California appellate court held that their claim was barred by the workers’ compensation statutes.
The Court of Appeal explained:
“[A]n injured employee’s sole and exclusive remedy against his or her employer is the right to recover workers’ compensation benefits, provided “the conditions of compensation set forth in Section 3600 concur.” (§ 3602, subd. (a).) Section 3600, subdivision (a), provides in part: “Liability for the compensation provided by this division . . . shall, without regard to negligence, exist against an employer for any injury sustained by his or her employees arising out of and in the course of employment . . . .” (§ 3600, subd. (a), italics added.) “In all cases where the conditions of compensation set forth in Section 3600 do not concur, the liability of the employer shall be the same as if this division had not been enacted.” (§ 3602, subd. (c).)”
The California appellate court further described the application of the “bunkhouse rule”“
“When an employee is injured while living on the employer’s premises, the course of employment requirement in section 3600, subdivision (a), is satisfied if the employment contract of the employee contemplates, or the work necessity requires, the employee to reside on the employer’s premises. (Aubin v. Kaiser Steel Corp. (1960) 185 Cal.App.2d 658, 661 (Aubin).) This rule is known as the bunkhouse rule. The bunkhouse rule is an extension of the general rule that, where an employee is injured while on the employer’s premises as contemplated by the employment contract or the necessity of work, the employee will be compensated.3 (Rosen v. Industrial Acc. Com. (1966) 239 Cal.App.2d 748, 750 (Rosen); Aubin, supra, 185 Cal.App.2d at p. 661.) One rationale behind the bunkhouse rule is an employee’s reasonable use of the employer’s premises constitutes a portion of the employee’s compensation. (See e.g., Truck Ins. Exch. v. Industrial Acc. Com. (1946) 27 Cal.2d 813, 819; Aubin, supra, at p. 661.) Although “invocation of the bunkhouse rule establishes that the injury occurred in the course of the employment[,] . . . there also must be some connection between the employment and the injury, or an injury arising out of the reasonable use of the premises, or the bunkhouse must place the employee in a peculiar danger.” (State Comp. Ins. Fund v. Workers’ Comp. App. Bd., supra, 133 Cal.App.3d at p. 653, fns. omitted.) Thus, an injury sustained by an employee in a bunkhouse is not per se compensable. (Ibid.; see also Crawford v. Workers’ Comp. App. Bd. (1986) 185 Cal.App.3d 1265, 1268 [the requirements in § 3600, subd. (a), “are stated conjunctively and both must be satisfied for an injury to be compensable”].)
Then, the Court of Appeal administered the coup d’ grace to the Vaught’s claim when it applied the bunkhouse rule to Marck Vaught’s employment as a park ranger;
“We further conclude Marck resided in the ranch house out of work necessity, which provides an independent basis to satisfy the course of employment requirement. As a park ranger, Marck was required to be “on call all the time.” Marck also was required to patrol within the District. Because of the location of the ranch house in connection with his work, Marck and the State agreed Marck “would report to Borrego Springs to the district office,” but he “could work out of the house at Vallecito.” Marck also used a portion of the ranch house as his office, where he stored equipment, topographical and park maps, and various items he used on patrol, for fire protection, and search and rescue in connection with his job. Although Marck was not compelled to live in the ranch house, the nature of his work as a resource ranger necessitated that he live there.”
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]]>I had the privilege of representing a nice fellow by the name of Sean Ryan. With the noblest of motives, Sean Ryan reported to his superiors a circumstance that he believed demonstrated a violation of law. He was terminated shortly thereafter. The sales that Sean Ryan had completed were given to one of his female colleagues. She submitted the sales and received a commission. After filing his lawsuit, Verizon recognized that it had indeed failed to pay Mr. Ryan all of his wages at time of termination. The company sent him a check, but denied that he was owed any commission. Sean Ryan took Verizon to court, and after several days of testimony the jury reached a verdict: Verizon had to pay.
Despite being found liable by a jury after an extensive court trial, the Verizon / Idearc decided that it is sometimes easier to convince people through a threat than simply pay what is owed.
Verizon / Idearc chose to send the letter attached rather than pay an amount that the jury found it liable for.
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]]>The post Murphy v. Burch – No Easement By Necessity For The Owner Of A Landlocked Parcel. appeared first on The McMillan Law Firm, APC..
]]>In reversing the trial court’s judgment, the Court of Appeal ruled that it is the existence of the power of eminent domain that is relevant, because that existence—and not the exercise of the power—vitiates the always-critical requirement of “strict necessity” for the creation of an easement by necessity.
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]]>The post Court Of Appeals Reverses Trial Court Grant Of Order Striking Complaint In Freeman V. Schack appeared first on The McMillan Law Firm, APC..
]]>The post Court Of Appeals Reverses Trial Court Grant Of Order Striking Complaint In Freeman V. Schack appeared first on The McMillan Law Firm, APC..
]]>The post Objection To Franchise Tax Board’s Claim For Unpaid Taxes Is Overruled. appeared first on The McMillan Law Firm, APC..
]]>Vignola later filed a second Chapter 13 petition, and the FTB filed a second claim in the full amount originally owed to it, even though Vignola had in the interim paid some of the taxes due. This time, Vignola did not object to the FTB claim, and did not object when the Trustee paid the tax claim in full. After discharge, Vignola’s motion to reopen the case was granted and she objected to the FTB claim. The Court ordered the return of the overpayment that represented collection of more than was due (and more than FTB agreed to accept in a post-collection agreement).
The remaining question was, when does interest on unpaid state income taxes begin to accrue? Interest is paid on any amount of unpaid tax. Vignola argued that tax liability did not accrue until she received notice of the deficiency assessment. The Court rejected this argument and found that interest began to accrue from the due date of the tax, April 15, 1992, whether or not the tax was a deficiency assessment.
Interest on tax deficiencies at the federal level is treated similarly as that under California law. It is paid from the last date the tax is due. Cal. Rev. & Tax. Code §19101(a). The last date for tax payment is determined by Cal. Rev. & Tax Code §19101(b) and was due April 15, 1992. Interest accrued from that date.
Vignola argued accrual of interest does not occur until the deficiency is created. If the tax is not paid, interest is assessed to compensate the government for its loss, no matter what the reason is for the late payment. See Suffness v. United States, 974 F.2d 608, 610 (5th Cir.1993).
Taxes assessed 240-days pre-bankruptcy petition have priority status. 11 U.S.C. §507(a)(8)(A). In this case, the tax was assessed within that 240-day pre-petition period when the notice of deficiency became final. Interest on the FTB’s claim accrued from nearly four years before the deficiency notice became final. Vignola argued that FTB could not have priority status from the date the deficiency notice became final and calculate interest from the 1992 due date. Under that argument, if the notice of deficiency had been timely filed, the entire FTB claim would be too old for priority status.
The Court disagreed. FTB’s claim maintained priority status. The Court agreed with Vignola that it is unfair to give priority status to both the claim, which has the effect of stating the claim is only 240 days old, and charge interest for the prior four years. But the Court determined that interest is a mandatory component of the tax owed, not an independent liability. Additionally, there is no statutory authority for abatement of mandatory interest.
The objection to the FTB claim was overruled.
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]]>The post Parlour Enterprises, Inc. V. The Kirin Group, Inc. – Farrell’s Franchisor Obtains A Reduction Of Damages On Appeal. appeared first on The McMillan Law Firm, APC..
]]>The post Parlour Enterprises, Inc. V. The Kirin Group, Inc. – Farrell’s Franchisor Obtains A Reduction Of Damages On Appeal. appeared first on The McMillan Law Firm, APC..
]]>The post Court Overturns Summary Judgment In Favor Of Lender In WRI Opportunity Loans II LLC V. Cooper appeared first on The McMillan Law Firm, APC..
]]>The post Court Overturns Summary Judgment In Favor Of Lender In WRI Opportunity Loans II LLC V. Cooper appeared first on The McMillan Law Firm, APC..
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