I write to highlight three recent changes to the Davis-Stirling Act that respectively affect (i) the manner in which common interest developments (planned unit developments, condominium complexes, stock cooperatives, and community apartment projects; collectively, “CIDs”) impose monetary penalties on any association member for violations of the governing documents, (ii) disclosure and recordkeeping for balconies inspection reports in condominium projects, and (iii) an insurance coverage requirement for owner-installed electric vehicle charging stations in CID common area or exclusive use common area.
- Fines and Penalties: Changes in the Governing Document Enforcement Procedure.
I previously wrote in this office’s August 2025 Perspectives newsletter about Assembly Bill 130, which took immediate effect on July 1, 2025, impacting several housing-related issues, including governing document violations in CIDs. Due to the mid-year chaptering of the law and its impact, I am covering this law once more.
Under the law as it existed before AB 130, CIDs were authorized to adopt a policy imposing monetary penalties on a CID member for a violation of the governing documents, and CID boards were required to adopt and distribute to each member a schedule of the monetary penalties that may be assessed for violations. Under the pre-AB 130 law, boards were able to impose a monetary penalty on a member for a violation of the governing documents up to the amounts set forth in the CID’s adopted monetary penalty schedule after a duly noticed hearing.
As a result of the new law, (a) CIDs are prohibited from assessing monetary penalties of greater than $100 per violation, (b) boards are required to give the member suspected of a violation the opportunity to cure a violation prior to the hearing, (c) if the board and member are in agreement at the hearing, the board will be required to draft a resolution, which, if signed by the board and member, would be judicially enforceable, (d) if the board and member are not in agreement after the hearing, the member will have the opportunity to request internal dispute resolution, and (e) if the board imposes a monetary penalty on a member or imposes a monetary charge on a member for damage to the common area and facilities, the board is required to provide the member with written notification of the decision within fourteen (14) days following the action.
These changes to the Davis-Stirling Act will undoubtedly change a CID’s governing document-enforcement procedure. For CIDs dealing with relatively minor infractions, boards will have to exhaust additional steps (and time and money) before a monetary penalty of up to $100 per violation may be assessed. For CIDs dealing with relatively greater violations, boards may consider enforcing the governing documents by other legal options. Either way, CID boards should closely review Civil Code Section 5850 and 5855 (where the pertinent changes are due to AB 130) with legal counsel and community management for any needed changes to the boards’ enforcement procedure.
- Balcony Inspection Reports in Condominium Projects: Disclosure and Recordkeeping.
You may recall that in 2020, new Civil Code Section 5551 (“§5551”) took effect that requires Boards of condominium projects to visually inspect, at least once every nine (9) years, the exterior elevated elements of the association’s structures that the association is required to maintain under its governing documents.
While §5551 is generally recognized as a “balcony inspection” requirement, the obligation is actually much broader than simply the balconies of an association. Because the operative term is “exterior elevated elements,” §5551 also applies to any other components that extend beyond the exterior walls of a structure that delivers a structural load to its decks, balconies, stairways, walkways, and their railings.
Indeed, §5551 applies to all walking surfaces that are (a) elevated more than six feet above ground level, (b) designed for human occupancy or use, and (c) supported in whole or in substantial part by wood or wood-based products, as well as the waterproofing system associated with those components.
Boards of condominium projects that are required to carry out balcony inspections were required to complete their first inspection by January 1, 2025. Therefore, if your condominium project has not conducted its inspection, this should be done as soon as possible.
Once an inspection has been performed, follow-on inspections must occur at least once every nine (9) years thereafter in coordination with the reserve study inspections that all CIDs must conduct every three (3) years pursuant to Civil Code Section 5550. All written reports shall be maintained for two inspection cycles (i.e., 18 years) as records of the association.
Senate Bill 410 made additional changes: (i) the inspector’s written reports are required to contain certain information (including the total number of units in the condominium project and a certification that the inspector has conducted a visual inspection and evaluated a statistically significant sample of the exterior elevated elements), (ii) the balcony inspection requirements are limited to condominium buildings containing three (3) or more attached multifamily dwelling units – previously, §5551 applied to buildings containing three or more multifamily dwelling units regardless of whether the units were attached, (iii) all inspection reports are now “association records” subject to inspection and production, and (iv) a copy of the report issued for the most recent balcony inspection must be provided to prospective purchasers of condominiums within condominium project subject to the balcony inspection requirements.
- EV Charging Station Insurance Requirement
Civil Code Section 4745 (“§4745”) imposes various requirements regarding the installation and use of an electric vehicle charging station (“EVCS”) installed in a common area or an exclusive use common area of a CID, including that the owner or tenant-shareholder, as appropriate, is required to provide a certificate of insurance that names the association as an additional insured party.
Senate Bill 770 eliminated the requirement that owners desiring to install an EVCS in CID common area or exclusive use common area name the CID as an additional insured on the owner’s insurance policy. SB 770 does not otherwise alter the requirement that the owner provide the CID with a certificate of insurance within 14 days of the CID’s approval and annually thereafter. Unfortunately, SB 770 would add extra steps for CIDs seeking to recover against an insurance policy for losses related to an EVCS.
If you have further questions regarding these new laws or any other matters of importance to your CID, please contact Bill Scherer at wms@sfcounsel.com or Louis Sarmiento at ljs@sfcounsel.com.