When a resident in an homeowners association exhibits extreme behavior that is criminal or suggests mental illness, the HOA’s enforcement system of rules and fines is often completely inadequate. This article looks at the obligations of the board when dealing with aberrant behavior.
Introduction
At the monthly board meeting members come forward with the following reports: There is a “peeping tom” living in the community; an exhibitionist is displaying his “charms” in the subdivision; a member may have Alzheimer’s disease and parades unclothed through the subdivision at night; a known mentally disordered sex offender (MDSO) moved into the complex; a member is “hostile and aggressive” and makes verbal and written threats against his neighbor. Now what do you do?
These questions, drawn from real cases, present extremely difficult legal questions for the board of a homeowner association. Does the board have a duty to take action? Are there legal limitations that constrain action by the board? Let’s look at the guidance provided by California and federal law.
Duties of Investigation and Care
In Isaac’s v. Huntington Memorial Hospital,38 Cal 30 112 (1985) the California Supreme Court stated that the owner’s duty to provide protection from foreseeable third party crime has always been determined in part by balancing the foreseeability of the harm against the burden of the duty to be imposed, and it specifically held that this duty is determined by the balancing of foreseeability of the criminal acts against the burden and efficacy of proposed security measures. The Court concluded that “high degree of foresee-ability is required in order to find that the scope of the landlord’s duty of care includes the hiring of security guards, and that the requisite degree of foreseeability rarely, if ever, can be proven in the absence of prior similar incidents of violent crime on the landowner’s property.”
The California Supreme Court then ruled that a homeowner association has a duty to exercise due care for the safety of residents in those areas under the association’s control. [See Frances T. v. Village Green Owners Assn., 42 Cal 3d. 490 (1986).] The board can be liable for failure to take reasonable steps to prevent injuries from foreseeable criminal activity. The foreseeability of criminal activity is determined in light of all of the circumstances, and not by a rigid application of a mechanical “prior similars” rule. [Isaac’s v. Huntington Memorial Hospital, 38 Cal 3d. 112 (1985).]
In the case of Ann M. v. Pacific Plaza Shopping Center, 6 Cal 4th 666 (1993), the California Supreme Court held that a high degree of foreseeability is required in order to find that the scope of a property owner’s duty of care includes adequate measures to prevent harm from criminal activity. But the Ann M. court further held that landowners must maintain their land in a reasonably safe condition, and must take reasonable steps to secure common areas against foreseeable criminal acts of third parties that are likely to occur in the absence of such cautionary measures. The California courts have not found an easy standard to apply under the circumstances, because although landowners have the ability to reasonably control their own property, criminal acts are inherently unpredictable.
In Phillips v. Perils of Pauline Food Production, Inc., 35 Cal.App. 4th 1510 (1995), the California Court of Appeal held that the property owner’s duty includes exercising reasonable care to discover whether criminal acts are being, or are likely to be, committed upon the owner’s land. If an investigation would in all probability lead to the discovery of prior similar incidents to the occurrence giving rise to an injury, constructive knowledge of such incidents is imparted to the property owner, and the owner may be liable for the damage resulting from the criminal activity.
It is clear that reports of criminal activity on the common area that may lead to attacks against residents require investigation and warrant prompt reports to law enforcement.
Fair Housing Duty of Accommodation
The Fair Housing Amendments Act 42 U.S.C. Section 3601, et seq. has direct application to these issues. The Fair Housing Amendments Act (“Act”) makes it illegal to discriminate against any person in providing services or facilities in connection with a dwelling. [42 U.S.C. Section 3604.] The Act defines discrimination as including the “refusal to make reasonable accommodations in rules, policies, practices and services, when such accommodations may be necessary to afford such person equal opportunity to use and enjoy a dwelling.” In short, federal law requires a board to “bend the rules” for the benefit of disabled persons, so that they may use and enjoy their housing facilities. Mental illness or emotional disturbance qualifies a resident for protection under the Act, in addition to physical disabilities. Unfortunately, the term “reasonable accommodations” is not defined by the Fair Housing Amendments Act, and case law discussing the application of this statute provides little guidance to a homeowner association.
Voyeurism (our “peeping tom”), exhibitionism (the neighborhood “flasher”), dementia of the Alzheimer type, and pedophilia (the “MDSO”) all are psychiatric abnormalities that are recognized by the American Psychiatric Association and are clinically described in the Diagnostic and Statistical Manual of Mental Disorders (DSM). Alcoholism might explain the “hostile and aggressive” behavior of the neighbor. All of these conditions are recognized disabilities in the Fair Housing Act. Obviously exhibitionism, voyeurism and pedophilia when acted out in society are violative of California criminal laws, including California Penal Code Sections 311 and following, and Section 647.
In Shapiro v. Cadman Towers, Inc., 51 F.3d 328, 334-335 (2nd Cir. 1995), the Second Circuit Court of Appeals held that a cooperative housing complex could be required to incur reasonable costs to accommodate a handicapped owner, provided the accommodation did not impose an undue hardship or “substantial burden.” In that case, the association was required to provide a convenient ground floor parking space for an owner afflicted by multiple sclerosis. The Court expressly noted that the extent to which a “reasonable accommodation” for a handicapped individual can burden or take away rights or privileges enjoyed by the non-handicapped persons is an undecided question. However, few would argue that the duty of the association to accommodate the disabled requires tolerating criminal behavior or conduct that is a safety threat to others. More difficult to know is the degree of nuisance and annoyance that must be tolerated to meet the duty of accommodation under the Act.
Business Judgment Rule
The board must exercise its business judgment concerning whether the past criminal acts of the individual are likely to create a threat to security on the common area in the future. If inquiry and deliberation lead to the conclusion that there is such a threat, it is appropriate that the board take commensurate actions to assure security in the common area. On the other hand, if there is no reason, in the board’s judgment, to believe that an individual presents harm to others, then the law does not require the board to implement additional security measures for the common area. In exercising business judgment, the board may rely on the advice of individuals with particular knowledge and skill in the area, such as security consultants.
Under Corporations Code Section 7231, directors who use qualified consultants secure the benefits of the “safe harbor” rule. By relying in good faith on such competent third party advice, the board of directors obtains qualified immunity against liability for breach of the duty of care to the corporation. The California Supreme Court clarified the standard of care of directors in its landmark decision of Lamden v. La Jolla Shores Clubdominium Homeowners Association, 21 Cal 4th 249 (1999).
California courts have also affirmed the business judgment rule in the contexts of decisions relating to maintenance of the improvements in the subdivision and enforcing architectural restrictions. [Lamden v. La Jolla Shores Clubdominium Homeowners Assn. (above) and Dolan‑King v. Rancho Santa Fe Association et al. 81 Cal.App. 4th 965 (2000)]. A court reviewing the business decisions of a board relating to fair housing issues should extend the same legal protection to the association and board as did the Lamden court when reviewing maintenance procedures and the Dolan‑King court when reviewing architectural decisions. No California court has yet decided this issue in a reported decision.
Our Questions Revisited
While voyeurism and exhibitionism may seem to be acts strictly within the purview of the criminal justice system, such conduct may well trigger a duty of investigation on the part of the board and a duty to enhance security on the common area. As noted, the Frances T. case imposes a duty of care on the part of the association and its directors to protect residents from foreseeable criminal activity. The Ann M. decision requires the association to maintain the common area in a reasonably safe condition and to take reasonable steps to secure the common area against foreseeable criminal acts of third parties that are likely to occur in the absence of such cautionary measures.
Arguably acts of exhibitionism and voyeurism are not harbingers of criminal attacks on residents in the community. But the occurrence of this criminal behavior may suggest that conditions in the community foster criminal behavior, because of inadequate common area lighting, overgrown landscaping or lack of security. Yet, in the case of residents suffering Alzheimer’s disease, alcoholism, or mental or emotional disabilities that may produce hostile conduct, considerable finesse is necessary to balance the affirmative duty of the association to provide accommodation to the disabled with the duty of the association to ensure that the common area is safe for the owners and residents.
What of the owner who is being threatened by his neighbor? Most directors feel that the association has no legitimate business interjecting itself into private quarrels between neighbors. However, the association may well be inveigled into fights between neighbors. The origin of the dispute may lie in a claimed violation of the CC&Rs, such as a claimed nuisance or annoyance that is prohibited by the declaration of restrictions. The aggrieved owner may bring suit against both his neighbor and the association for failure to enforce if the association is passive. Or, common area conditions may be involved in the dispute, such as a construction defect in the floor-ceiling assembly that allows excess noise to be transmitted from the upper to the lower unit. The “private” dispute may, on closer review, involve conditions for which the association is responsible. If the aggressive neighbor presents a security threat on the common area, the association must necessarily consider taking measures to address the duty of care that has been outlined in the case law or to abate a nuisance under the CC&Rs.
The “Megan’s Law” disclosure information is updated to local law enforcement agencies monthly. The information is categorized by community of residence and ZIP Code, including the name and known aliases of the person, photograph, physical description, gender, race, date of birth, the criminal history, the address, including ZIP Code, in which the person resides, and other relevant information. A 900 number is established for public call-in information. [See Penal Code Section 290.4 as amended.] The information also is available online at www.meganslaw.ca/gov.
While it is wrong, in this author’s view, for an association to secure and publish in a newsletter to the members the identity of any mentally disordered sex offenders who may be residents in the community, or nearby, it certainly is appropriate for the association to notify members of their right to obtain this information from the local police department. Some communities have also notified residents that there is a mentally disordered sex offender who is living in the community, without identifying the individual’s name or address, to allow other residents to take appropriate precautions. Obviously this issue is highly charged; any incorrect or misleading information could be seriously damaging to an individual’s reputation and would almost certainly lead to a defamation action against the board members and association. Extreme caution is required in these circumstances, and the board should seek legal advice from the association’s counsel before acting. Penal Code Section 290.4(d)(2)(G) prohibits the use of the Megan’s Law information to discriminate in housing.
Associations have found a wide range of tools helpful in addressing these extremely difficult and delicate problems. Certainly close cooperation with law enforcement officials is appropriate. Some associations have assisted law enforcement in identifying and reporting criminal suspects, and have cooperated in surveillance programs. Law enforcement can assist in securing a 72-hour psychiatric hold and evaluation under the Lanterman-Petris Short Act, California Welfare and Institutions Code Section 5150, or may arrest persons for disturbing the peace or making threats of death or great bodily injury. [Penal Code Sections 415 and 422.]
In other instances, board members and their management representatives have met with owners or their family members in a tactful, non-threatening environment to discuss the safety and the proper care of residents who are having difficulty looking after their own needs. Skillful communications are likely to be far more successful than heavy-handed enforcement procedures.
Fines can be levied against the responsible homeowner. If the disabled individual is a renter, the owner landlord should be considered as the one to make the accommodation.
In many instances, it is certainly appropriate for the board of directors to secure an injunction from the Superior Court preventing violation of the CC&Rs by an individual. California Civil Code Section 5975(b), which generally requires that a “request for resolution” be served on the owner prior to initiating a lawsuit, allows an immediate filing for a temporary restraining order or preliminary injunction where circumstances warrant. If a compelling need is shown to the court, the association is likely to obtain a preliminary injunction compelling compliance with the CC&Rs or forbidding further violations. The order can be enforced by the contempt power of the court after the order is personally served on the defendant. Even if it is expected that compliance with the court’s order is unlikely, exhausting the association’s legal remedies will give substantial protection to the board of directors and association in the unfortunate event that personal injury or property damage results from criminal activities by a resident. Ultimately, owners may need to take responsible steps to protect themselves.
The challenges created by criminal activity and by persons with mental or emotional disabilities are formidable. The legal standards that the board must meet conflict and can be difficult to apply. Careful coordination between the board, the association manager and the association’s legal counsel is appropriate to evaluate whether association intervention is appropriate and, if so, what options can be exercised effectively and without impairing federally protected rights of the disabled.
Published in the ECHO Journal, June 2011
Jeffrey A. Barnett is an association attorney with legal offices in San Jose. He is a member of the ECHO Legislative Committee and the Legal, Central Coast and South Bay Resource Panels.