The Glen Gazette

One Glen Lake Drive, Pacific Grove, CA 93950

President: Candy Pollock

Vice-President: Jack Rutherford

Secretary: Glen Grossman

Treasurer: Jim Ray

At-Large Director: Jack Rugar

Newsletter: Glen Grossman

Ron Johnson

Sandy Claus

Jessa Lee Lapatra

Gardening: Pat Claus

Carol Rutherford

Welcoming: Edith Davis

Stephanie Lee

Craig Woolley

Joseph Chaffers (MCC)

Today, condominiums, cooperatives, and planned-unit developments with homeowners associations have become a widely accepted form of real property ownership. These ownership arrangements are known as "common interest" developments. The owner not only enjoys many of the traditional advantages associated with individual ownership of real property, but also acquires an interest in common with others in the amenities and facilities included in the project. It is this hybrid nature of property rights that largely accounts for the popularity of these new and innovative forms of ownership in the 20th century.

The term "condominium," which is used to describe a system of ownership as well as an individually owned unit in a multi-unit development, is Latin in origin and means joint dominion or co-ownership. The concept of shared real property ownership is said to have its roots in ancient Rome. The accuracy of this view has been challenged, however. Professor Natelson points to evidence tracing the condominium concept to medieval Germanic custom. By the 12th century, the towns of Germany had embraced the notion of separate ownership of individual stories in a building. Houses were horizontally divided, and specific parts so created--the stories, floors, and cellars--were held by different persons in separate ownership; this being associated, as a rule, with the community ownership of the building site and the portions of the building (walls, stairs, roof, etc.) that were used in common. Development of this innovative form of ownership in Germany may have been encouraged by two factors: a vibrant middle class made the institution possible, and the cramped nature of life behind town walls made it desirable.

The concept of "horizontal property" or "strata" ownership simply means that the area above land can be divided into a series of strata or planes capable of severed ownership, making the ownership of things affixed to land separable from the ownership of the land itself. This idea, however, was inconsistent with the view expressed in many European civil codes and at English common law that the owner of the soil possessed the exclusive right to control everything on, above, or beneath the land, and that fixtures attached to land therefore could not be severed from ownership of the land. Congress, through the National Housing Act of 1961, made federal mortgage insurance available to condominium units so as to encourage and facilitate home ownership. Why did it take so long for this country to accept the idea of horizontal property ownership? Perhaps because the United States was, until recent times, so sparsely populated--and undeveloped habitable land and building materials so affordable--that there was "no great physical need for superimposing one dwelling upon another.

To divide a plot of land into interests severable by blocks or planes, the attorney for the land developer must prepare a declaration that must be recorded prior to the sale of any unit in the county where the land is located. The declaration, which is the operative document for the creation of any common interest development, is a collection of covenants, conditions and servitudes that govern the project. Typically, the declaration describes the real property and any structures on the property, delineates the common areas within the project as well as the individually held lots or units, and sets forth restrictions pertaining to the use of the property.

Use restrictions are an inherent part of any common interest development and are crucial to the stable, planned environment of any shared ownership arrangement. The viability of shared ownership of improved real property rests on the existence of extensive reciprocal servitudes, together with the ability of each co-owner to prevent the property's partition.

The restrictions on the use of property in any common interest development may limit activities conducted in the common areas as well as in the confines of the home itself. Commonly, use restrictions preclude alteration of building exteriors, limit the number of persons that can occupy each unit, and place limitations on--or prohibit altogether--the keeping of pets. As of 1986, 58 percent of highrise developments and 39 percent of townhouse projects had some kind of pet restriction. Notable cases upholding pet restrictions include Noble v. Murphy (1993) 34 Mass.App. 452 [612 N.E.2d 266] [enforcing condominium ban on pets]; Dulaney Towers Maintenance Corp. v. O'Brey, 418 A.2d 1233 [upholding pet restriction]; Wilshire Condominium Ass'n, Inc. v. Kohlbrand (Fla.Dist.Ct.App. 1979) 368 So.2d 629.

Restrictions on property use are not the only characteristic of common interest ownership. Ordinarily, such ownership also entails mandatory membership in an owners association, which, through an elected board of directors, is empowered to enforce any use restrictions contained in the project's declaration or master deed and to enact new rules governing the use and occupancy of property within the project. Because of its considerable power in managing and regulating a common interest development, the governing board of an owners association must guard against the potential for the abuse of that power. Homeowners associations can be a powerful force for good or for ill in their members' lives. Therefore, anyone who buys a unit in a common interest development with knowledge of its owners association's discretionary power accepts the risk that the power may be used in a way that benefits the commonality but harms the individual. Generally, courts will uphold decisions made by the governing board of an owners association so long as they represent good faith efforts to further the purposes of the common interest development, are consistent with the development's governing documents, and comply with public policy.

Thus, subordination of individual property rights to the collective judgment of the owners association together with restrictions on the use of real property comprise the chief attributes of owning property in a common interest development. As the Florida District Court of Appeal observed in Hidden Harbour Estates, Inc. v. Norman (Fla.Dist.Ct.App. 1975) 309 So.2d 180 [72 A.L.R.3d 305], a decision frequently cited in condominium cases: "[I]nherent in the condominium concept is the principle that to promote the health, happiness, and peace of mind of the majority of the unit owners since they are living in such close proximity and using facilities in common, each unit owner must give up a certain degree of freedom of choice which he [or she] might otherwise enjoy in separate, privately owned property. Condominium unit owners comprise a little democratic subsociety of necessity more restrictive as it pertains to use of condominium property than may be existent outside the condominium organization."

Notwithstanding the limitations on personal autonomy that are inherent in the concept of shared ownership of residential property, common interest developments have increased in popularity in recent years, in part because they generally provide a more affordable alternative to ownership of a single-family home. In 1986, common interest developments at that time accounted for as much as 70 percent of the new housing market in Los Angeles and San Diego Counties. As of 1988, more than 30 million Americans lived in housing governed by owners associations.

One significant factor in the continued popularity of the common interest form of property ownership is the ability of homeowners to enforce restrictive CC&R's against other owners (including future purchasers) of project units. Generally, however, such enforcement is possible only if the restriction that is sought to be enforced meets the requirements of equitable servitudes or of covenants running with the land.

Restrictive covenants will run with the land, and thus bind successive owners, if the deed or other instrument containing the restrictive covenant particularly describes the lands to be benefited and burdened by the restriction and expressly provides that successors in interest of the covenantor's land will be bound for the benefit of the covenantee's land. Moreover, restrictions must relate to use, repair, maintenance, or improvement of the property, or to payment of taxes or assessments, and the instrument containing the restrictions must be recorded. Restrictions that do not meet the requirements of covenants running with the land may be enforceable as equitable servitudes provided the person bound by the restrictions had notice of their existence.

When restrictions limiting the use of property within a common interest development satisfy the requirements of covenants running with the land or of equitable servitudes, what standard or test governs their enforceability? In California, our Legislature has made common interest development use restrictions contained in a project's recorded declaration "enforceable ... unless unreasonable." Indeed, giving deference to use restrictions contained in a condominium project's originating documents protects the general expectations of condominium owners "that restrictions in place at the time they purchase their units will be enforceable." This in turn encourages the development of shared ownership housing--generally a less costly alternative to single-dwelling ownership--by attracting buyers who prefer a stable, planned environment. It also protects buyers who have paid a premium for condominium units in reliance on a particular restrictive scheme.

-- from the California Supreme Court’s decision in Nahrstedt v. Lakeside Village Condominium Assn. (1994) 8 Cal. 4th 361

Section 1353.5 is added to the Civil Code, to read:

(a) Except as required for the protection of the public

health or safety, no declaration or other governing document shall limit or prohibit, or be construed to limit or prohibit, the display of the flag of the United States by an owner on or in the owner's separate interest or within the owner's exclusive use common area, as

defined in Section 1351.

(b) For purposes of this section, "display of the flag of the United States" means a flag of the United States made of fabric, cloth, or paper displayed from a staff or pole or in a window, and does not mean a depiction or emblem of the flag of the United States made of lights, paint, roofing, siding, paving materials, flora, or

balloons, or any other similar building, landscaping, or decorative component.

(c) In any action to enforce this section, the prevailing party

shall be awarded reasonable attorneys' fees and costs.

The next special Board meeting will be held on February 11, 2003 at 5:00pm at Unit #9. The next general Board meeting will be held on February 21, 2003 at 5:00pm at Unit #9. All residents are invited to attend (stop by for coffee and refreshments before the meeting).