Legal Condo Definitions

Articles of Incorporation.  The articles of incorporation (or simply the “articles”) are usually short and often contain only the name of the homeowners association, the name of the associations initial agent for the service of process (the person authorized to receive legal notices), and a statement that the association is a non-profit mutual benefit corporation. Sometimes the articles also include language about voting, directors, amendments, and dissolution of the association. Articles are required only when an association is incorporated.  (Unincorporated associations sometimes have articles of association, but these are not required.)  Articles are prepared by the developers attorney, reviewed by a government agency (unless the project has fewer than five units or lots), and filed with the Secretary of State.

Association. Association is defined in Civil Code § 1351 as a nonprofit corporation or unincorporated association created for the purpose of managing a common interest development.

Bylaws. The bylaws describe the mechanics of association decision-making and management.  Bylaws vary widely in content and length, but usually include the following: (1) number of and selection methods for officers and directors; (2) notice, meeting and voting procedures for owner and board decisions; and (3) association record keeping and reporting requirements.  Although bylaws are common for both incorporated and unincorporated associations, they are required only for certain incorporated associations. Bylaws are prepared by the developers attorney and reviewed by a government agency (unless the project has fewer than five units or lots) at the time a condominium project or planned development is formed. But unlike articles and CC&Rs, bylaws are not recorded or filed with any government agency, and this makes them easier to change.

Common Area. The Common Area generally consists of the entire property except for the separate interests such as the units or lots.  It may also consist of mutual or reciprocal easement rights appurtenant to the separate interests.

Condominium Plan. The terms “subdivision map” and “condominium plan”, as well as the less common terms “final map” and “parcel map”, describe types of drawings that illustrate how a property is divided into units or lots.  These drawings show the exact location and boundaries of each unit or lot, and of the common area. They are prepared by licensed land surveyors, reviewed by government agencies, and recorded with the county at the time a condominium project or planned development is formed. Once recorded, the drawings become connected to every deed and mortgage on every unit or lot within the property, and this connection makes changing the map or plan very difficult without the consent of everyone with an interest in the property.  There can be several maps or plans recorded at different times as new portions of a project are added.  In some condominium projects, a condominium plan is attached to the CC&Rs rather than recorded separately.

Declaration of Covenants, Conditions and Restrictions (often simply called the “declaration” or the “CC&Rs”)  CC&Rs describe the rights and obligations of the homeowners’ association and of each owner. CC&Rs vary widely in content and length, but usually cover the following topics: (1) the boundaries of the common area and of each unit or lot; (2) the owner usage restrictions, typically including common area use restrictions, pet regulations, and alteration controls; (3) the maintenance responsibilities of the association and the individual owners; (4) the allocation of association operating costs among the owners, and the mechanism for collecting owner payments; (5) the dispute resolution procedure; (6) the enforcement powers; and (7) the rights and protections of mortgage lenders.

CC&Rs are required for all condominiums and planned developments. They are prepared by the developer’s attorney, reviewed by a government agency, the California Department of Real Estate (unless the project has fewer than five units or lots), and recorded with the county at the time a condominium project or planned development is formed.

Exclusive Use Common Area. The terms “exclusive use common area” and “restricted common area” are used interchangeably.  They refer to portions of a condominium project or planned development that are not within the defined boundaries of a unit or lot, but are intended to be used exclusively by one owner. Technically, exclusive use or restricted common area is part of the common area owned either by the homeowners’ association or by all of the owners, but one particular owner holds a type of easement which gives him/her exclusive usage rights. The  easement is permanent and cannot be taken away by the association or by the other owners. Decks, patios, parking spaces, and storage spaces are often assigned as exclusive use or restricted common area on the recorded plan or map, in the CC&Rs, or in the deed conveying the lot or unit to its first owner. The law automatically assigns all elements designed to serve only one particular unit or lot as exclusive use common area, but the automatic assignments operate only if they do not conflict with the governing documents.  Unless the CC&Rs otherwise provide, the board of directors may not grant an owner exclusive use of any portion of the general common area without the approval of 67% of all owners in the development.

Governing Documents. The term “governing documents” is used as a general reference to the entire group of legally recognized paperwork that creates and controls a condominium project or planned development.  The  governing documents typically include a subdivision map and/or condominium plan, a declaration of covenants, conditions and restrictions (often referred to as “CC&Rs”), articles of incorporation, bylaws, and rules.

Rules.  The CC&Rs usually empower the homeowners’ association to adopt rules and give the rules the same binding power as the other governing documents. The rules often provide usage restrictions relating to alterations, signage, waste disposal, parking, pets, and recreational facilities.  Where the same topics are discussed in the CC&Rs, the rules may add to or explain the CC&Rs but cannot conflict with them.  Association rules are usually enacted after some of the units or lots have been sold and the owners have taken control of the association.  They are not subject to any governmental review and do not need to be filed or recorded with any governmental agency.

Unit. In a condominium project, the individually owned area is called a unit. The exact physical location of each condominium unit within a particular project is shown on the recorded map or condominium plan.  The map or plan, and/or the CC&Rs, will also contain a definition of the term “unit” as it is used for that particular project, listing the elements of the building that are part of the unit.  These definitions vary significantly from project to project, and it is unwise to apply generalizations or assumptions.  Instead, read the definition in the CC&Rs with the following questions in mind:

(1)      Does the unit include any exterior surfaces such as roofing, siding or foundation?

(2)      What portions of the interior walls does the unit include: the whole wall (i.e. both sides and everything in between), half the wall (i.e. everything from one side to a point halfway to the other side), one finished surface (i.e. only the wallboard or plaster on one side), or just the finish (i.e. the paint or paper)? Note that some unit definitions distinguish perimeter walls (i.e. walls between units, or between a unit and the common area) from partition walls (i.e. walls between rooms in the same unit); or structural walls (i.e. walls that help hold up the building) from non-structural walls (i.e. those that simply divide rooms).  Where these wall-type distinctions are made, the portions of the wall that are part of the unit will vary depending on wall type.

(3)      What portions of the floors and ceilings does the unit include:  the entire floor or ceiling, all portions up to a midpoint, the finished portion (i.e. ceiling plaster or sheet rock, finished wood flooring), or just the finish (i.e. paint or carpet)?  Here again, some definitions distinguish floors and ceilings between units, or between a unit and the common area, from floors and ceilings between levels of the same unit.

(4)      What portions of the windows and doors does the unit include: the entire window or door, or only glass and screens?  Note that some definitions distinguish interior doors from exterior doors.  Does the definition include window and door frames?  Does it include window and door hardware?

(5)      Does the unit include all of the fixtures and appliances located within it?  Note that the term “fixtures,” when used in this context, encompasses cabinets, lights, electrical outlets, sinks, showers, and tubs.

(6)      What portions of the plumbing, electrical, heating and air conditioning systems are part of the unit: all elements that serve only the unit, or only elements visible from within the unit?

(7)      Does the unit include any decks, balconies, or patios, and if so, how does the definition describe the boundaries of these areas?