California Law Gives Homeowner Associations a Way to Overcome Supermajority Requirements
Voter apathy is bad enough on the federal, state, and municipal levels. It can really become a problem when it comes to homeowner associations (HOAs). This is not just a matter of the “wrong” people being elected to the Board, or bad policies being adopted. Voter apathy can also be a powerful, if unintentional, deterrent to bringing about positive changes in the way an HOA operates and conducts its business.
Many HOAs are governed by By-laws or Charters that require that any amendments to those documents and/or the CC&Rs can be passed only if they receive supermajority approval of all eligible voters. Technically, a majority is anything over 50%, and a supermajority is anything greater. It is typical, though, for a supermajority requirement to be framed as two-thirds or three-quarters of eligible votes.
A March 8, 2012 opinion from California’s Third District Court of Appeal (Quail Lake Owners Association v. Kozina) reminds us that there is a way for an HOA to overcome or change its supermajority requirement(s).
In the Kozina case, the HOA had attempted to amend the CC&Rs in a 2009 election. There were 1,958 eligible membership votes. 1,409 votes were cast, of which 1,209 voted in favor of the new CC&Rs. Although the vast majority of participants favored the amendments, the 1,209 yes votes failed to meet the supermajority requirement of the governing documents.
The HOA went to the San Joaquin County Superior Court and petitioned to have its supermajority restriction modified under a special proceeding authorized by California Civil Code Section 1356. Section 1356 provides that “the association, or an owner of a separate interest, may petition the superior court of the county in which the common interest development is located for an order reducing the percentage of the affirmative votes necessary for such an amendment.” The court may, but is not required to, grant the petition if six conditions are met:
- Not less than 15 days written notice of the court hearing has been given to all members and all mortgagees and government entities entitled to such notice.
- Balloting on the amendment had been conducted according the rules of the governing documents.
- A reasonable diligent effort was made to permit all eligible voters to vote.
- More than 50% of the members in the voting structure(s) had voted in favor of the amendment.
- The amendment is reasonable.
- Granting the petition would not be improper according to certain technical provisions of the section.
The Superior Court found that the specified conditions were met and it granted the petition. One owner appealed, contending that due process had not been followed. But the Appellate Court upheld the decision of the Superior Court. The petition was granted and the supermajority restriction was removed.