By the Numbers: California Condo Special Assessment

R.W. from California writes:

Dear Mister Condo,

Quoting the California Civil Code:

5605.
(b) Notwithstanding more restrictive limitations placed on the board by the governing documents, the board may not impose a regular assessment that is more than 20 percent greater than the regular assessment for the association’s preceding fiscal year or impose special assessments which in the aggregate exceed 5 percent of the budgeted gross expenses of the association for that fiscal year without the approval of a majority of a quorum of members, pursuant to Section 4070, at a member meeting or election.

(c) For the purposes of this section, “quorum” means more than 50 percent of the members.

4070.
If a provision of this act requires that an action be approved by a majority of a quorum of the members, the action shall be approved or ratified by an affirmative vote of a majority of the votes represented and voting in a duly held election in which a quorum is represented, which affirmative votes also constitute a majority of the required quorum.

Question 1: For 5605(b): Do an association’s more restrictive governing documents prevail over the Civil Code, or is it the other way around?

Question 2: For 5605(b)(c) and 4070: A quorum in a 50-member association is 26. A majority of 26 is 14. Does the code mean that if only 26 members vote, 14 of them prevail?

Mister Condo replies:

R.W., since I am not an attorney, I usually quake at any question that begins by quoting laws or civil codes. Add to that the fact that I am not an attorney nor am I an expert in California Civil Code, I hope you will respect my answer as being only friendly. For a legal opinion, I must insist you speak with a qualified attorney from your state. That being said, I do have an opinion and maybe some friendly advice you will find useful. Here goes:

My opinion on your first question is that whichever is more restrictive prevails. The clue is in the wording of the code where it states “Notwithstanding more restrictive limitations placed on the board by the governing documents”. To me, that means whichever of the two is more restrictive is the winner.

My opinion on your second question is that the governing documents may define a quorum. Absent that definition, the civil code defines a quorum as more than 50% of the unit owners. In your example, the quorum for a 50 member association would be 26 members. If 26 members attended the meeting where such a vote was to be held, at least 14 of them would have to vote in favor for the motion to prevail. Of course, if all 50 were present, it would take a vote of 26 for the measure to prevail.

I take it your association is grappling with a special assessment and trying to figure out how best to pass it correctly. Special assessments can be tricky and controversial. Depending on the overall temperament of your condominium owners, it can be almost impossible. If your association has retained the services of a qualified community association attorney, this is a great example of when it is time to consult with them to make sure that proper notice of the meeting is given and that all of the proper laws are observed, including the association’s own governing documents. There is nothing worse than doing all of the hard work involved in levying a special assessment just to find that a procedure was not properly followed and that a unit owner who is against the assessment then decides to sue the association to block the action. Consulting with the community association attorney may cost a little money upfront but it could prevent a lot of problems down the road. All the best!