Granting Exclusive Use to Portions of the Common Areas

GRANTING EXCLUSIVE USE TO
PORTIONS OF THE COMMON AREA

Over the years, some boards have treated common areas fairly casually. Starting January 1, 2006 the practice of giving individual owners exclusive use of common areas was significantly restricted by a new provision in the Davis-Stirling Act, Civil Code §1363.07. Following is a summary of the provision.

Membership Approval. Unless the association's governing documents specify a different percentage, giving an owner exclusive use of any portion of the common areas requires the approval of 67% of the membership. When presenting it for a vote, the board must specify (i) whether the association will receive any monetary consideration for the grant and (ii) whether the association or the transferee will be responsible for providing any insurance coverage for exclusive use of the common area.

Violations. If the board grants exclusive use without membership approval (and none of the exceptions below apply), owners may bring an action in court to reverse the approval. Owners have one year to bring any such action. If the owner is successful, penalties and attorneys' fees may be awarded against the association.

Exceptions to Membership Approval. There are limited exceptions to the above requirement. Unless the governing documents provide otherwise, the board may grant an exclusive easement without membership approval under the following conditions:

reconveyance of common area or granting exclusive use to the subdivider to enable the continuation of development that is in substantial conformance with plans of phased development submitted to Department of Real Estate;
to eliminate or correct engineering errors in recorded documents or documents on file with a public agency or utility company;
to eliminate or correct encroachments due to errors in construction;
to permit changes in the plan of development submitted to the Commissioner of the Department of Real Estate in circumstances where the changes are the result of topography, obstruction, hardship, aesthetic considerations, or environmental conditions;
to fulfill the requirement of a public agency;
to transfer the burden of management and maintenance of any common area that is generally inaccessible and is not of general use to the membership at large;
any grant in connection with an expressly zoned industrial or commercial development, or any grant within a subdivision of the type defined in Civil Code §1373

Procedure for Board Approval. Any request for exclusive use of any portion of the common areas should be listed in the board's posted open meeting agenda so the membership is on notice of the request. Any discussion and vote by the board should be done in an open meeting. Before granting any approvals, the board should make a finding, which is recorded in the minutes of the meeting, that one of the above exceptions applies and what facts support the finding.

Maintenance Issues. If the board or membership votes to allow an owner to have exclusive use of a portion of the common area, the approval should be conditional on the owner signing a recordable agreement obligating the owner to insure and maintain the property. This will put all future owners on notice of their obligation. The board should also consider putting an indemnity provision in the agreement.

Clubhouse Rentals. The above requirements probably do not apply to renting facilities such as the clubhouse for parties or weddings, or the tennis courts for tournaments. This is not what was contemplated by the statute and normally there is general language in the governing documents giving the board authority to allow such events.

Updated by ADAMS KESSLER 8/15/2008