California real estate law allows the creation of homeowner associations (HOAs) to govern certain types of properties, known as “common interest developments” (CIDs). An HOA is responsible for maintaining a CID’s common areas, and it has the authority to collect fees from homeowners to pay for maintenance. When an HOA negligently fails to maintain a common area, the HOA may be liable for injuries that occur as a result. A recent appellate court decision from New Jersey addressed HOAs’ duty of care to residents and others. It is worth revisiting California law on this issue.
Determining a property owner’s liability for an injury occurring on their premises involves two important distinctions:
– First, did the injured person have permission to be on the property? A property owner owes a minimal duty of care to a trespasser, meaning someone who enters their property without permission.
– Second, did the injured person’s presence on the property confer a benefit on the property owner? A “licensee” is someone who enters property with the owner’s permission, but not for an economically beneficial purpose. Social guests are usually licensees. An “invitee” enters property with permission and for the purpose of benefiting the owner.
Property owners must warn licensees of any hazard of which they actually know, and they must warn invitees of any hazard of which they know or should know. These rules derive from common law but are partly codified in California statutes. See, e.g. Cal. Civ. Code § 846.
Owners of homes in planned developments, units in condominium projects, and other individual components of CIDs are probably familiar with their own HOAs. Individual members of the HOA are responsible for the safety of their own property, but the HOA itself has responsibility for the safety of common areas in the development. The governance of an HOA is similar to that of a corporation in many ways. Individual HOA directors are shielded from liability for “acts or omissions” that occur as part of their duties as directors, which they “perform in good faith” and which are not “not willful, wanton, or grossly negligent.” Id. at § 5800(a). California courts generally defer to the decisions of HOA directors, but a plaintiff may still hold the HOA liable for the negligence of its directors. See Lamden v. La Jolla Shores, 980 P. 2d 940 (Cal. 1999).
The decision by the New Jersey Appellate Division in Lechler v. 303 Sunset Avenue Condominium Assn., No. A-1095-16T3, slip op. (N.J. App., Dec. 29, 2017), held that an HOA is liable to both invitees and licensees for injuries caused by a failure to correct a hazard in a common area. California courts have reached similar decisions. In Ritter & Ritter, Inc. v. The Churchill Condominium Assn., 166 Cal.App.4th 103 (Cal. App. 2d Dist. 2008), an appellate court in Los Angeles applied common-law principles of landlord-tenant law. The court held that the HOA is essentially in the position of the landlord, and it is therefore liable for injuries caused by its failure to maintain a common area.
For over 40 years, business and real estate attorney James G. Schwartz has advocated for the rights of businesses and property owners in the Bay Area in both litigation and transactional matters. You can contact us online or at (925) 463-1073 today to schedule an initial confidential consultation with a member of our team.
More Blog Posts:
California HOAs Deal with Water Shortages and State Environmental Regulations, Pleasanton Business & Commercial Law Blog, June 30, 2016
California Water Restrictions Conflict with Homeowners’ Association Rules Regarding Lawns, Pleasanton Business & Commercial Law Blog, July 31, 2015
New California Law Prohibits Homeowner Associations from Penalizing Homeowners Who Do Not Water Their Lawns During Droughts, Pleasanton Business & Commercial Law Blog, September 30, 2014