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Understanding the Davis-Stirling Act and HOAs

California homeowner associations are required to comply with the Davis-Stirling Common Development Interest Act, a complex piece of state legislation that contains more than 100 statutes. When HOA disputes arise, the law provides some potential remedies to the parties while other statutes under the act provide no penalties for violations.

The Davis-Stirling Act gives HOA boards the power to increase their annual assessments by as much as 20 percent and to impose additional special assessments of up to 5 percent of their budgeted expenses. They can only do so if they first disclose these intended increases by distributing the budget at least 30 days before the start of its fiscal year. If the board fails to meet the disclosure requirements, the special assessments and the increases can only be imposed following a simple majority vote by the members.

Members are also protected in their rights to inspect the records. This extends to inspecting the minutes, invoices, checks, management records and other documents. If the requested records could result in identity theft, the board must take steps to remove the identifying information, or they may be liable. If the voting laws are violated, there are multiple remedies available, including voiding the results, injunctive relief, monetary damages, civil penalties and the award of attorney fees and costs.

Members who are involved in HOA disputes might want to consult with real estate attorneys who are experienced in handling these types of matters. The attorneys may analyze the facts of their clients' cases to determine whether any of the provisions of the Davis-Stirling Act have been violated. They may then send demand letters and try to negotiate resolutions of the disputes short of filing lawsuits.

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