Amended IN Senate May 07, 2019 CALIFORNIA LEGISLATURE 20192020 REGULAR SESSION Senate Bill No. 434Introduced by Senator ArchuletaFebruary 21, 2019 An act to add Section 5382 to the Civil Code, relating to common interest developments. LEGISLATIVE COUNSEL'S DIGESTSB 434, as amended, Archuleta. Common interest developments: managing agent: production of client property and client records upon termination of management agreement. Existing law, the Davis-Stirling Common Interest Development Act, governs the management and operation of common interest developments and defines a managing agent as a person who, for compensation or in expectation of compensation, exercises control over the assets of a common interest development. This bill would require a managing agent whose management agreement has been terminated to produce client property and client records within a specified period of time pursuant to a written request by a common interest development association, association in a format that the association can reasonably use, except as specified. The bill would define client property and client records for purposes of those provisions. Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: NO Local Program: NO Bill TextThe people of the State of California do enact as follows:SECTION 1. Section 5382 is added to the Civil Code, to read:5382. (a) (1) Upon receipt of a written request by the association or its legal counsel to produce client property and client records, a managing agent of a common interest development whose management agreement has been terminated shall produce client property and client records to the person designated in the request as soon as reasonably practical after the managing agent receives the request, but in no event more than 30 days from either the effective date the management agreement was terminated or the date the managing agent received the request, whichever is later.(2) Notwithstanding paragraph (1), the managing agent and association may agree in writing to a longer period of time that the managing agent is required to produce client property and client records upon termination of the management agreement.(3) A dispute of the management agreement termination or fees shall not affect the managing agents duty to produce client property and client records within the time period specified in this subdivision.(b) A managing agent shall produce all client records in the form in which they have been kept by the managing agent or in a form which the managing agent reasonably believes will be usable by the association, and in a manner that is not unduly burdensome to the managing agent. a format that the association can reasonably use. The managing agent shall not be required to produce client records in more than one form. format.(c) A managing agent shall is not be required to produce a client records record only under one of the following circumstances:(1)The client records are not reasonably available because of undue burden or expense.(2)The client records include proprietary or other trade secret information developed by the managing agent for use in the managing agents management business.(3)The client records have been lost, damaged, altered, or overwritten as the result of routine good faith operation of an electronic information system.(1) The record has been lost or destroyed due to unforeseen circumstances outside of the managing agents control, including, but not limited to, corruption of electronically stored files due to viruses, malware, or a hardware malfunction against which the managing agent has taken reasonable precautions.(2) The record has been purged in accordance with a document retention policy that has been approved by the association board and that ensures the association can comply with subdivision (i) of Section 5210.(d) The managing agents obligation to honor all association confidences and to treat the business affairs and records of the association as confidential continues after termination of the mananagement management agreement. If information is sought by a third party through legal process, including subpoena or the discovery process, the managing agents obligations under this subdivision shall be satisfied if the managing agent gives notice to an officer of the association no later than 10 days after receipt of the subpoena, discovery request, or other legal process.(e) For purposes of this section, the following definitions apply: (1) Client property means the associations physical property, including, but not limited to, manuals for operation, maintenance or warranty of elevators, pool heaters, HVAC systems, security gate transponders, and pool keys.(2) Client records means hard files and electronically stored information maintained by the managing agent in the ordinary course of business that the managing agent is legally required to maintain or that is reasonably necessary for the associations continued operation, including, at a minimum, all items presented to an association board of directors for their consideration, except for items that are reasonably deemed proprietary by the managing agent. Client records does not include the following:(A) Working papers, internal communications, proprietary documents, or internal notes developed or created by the managing agent.(B) Records of telephone conversations or emails unless they previously have been included in a board packet or vendor or project file.
Amended IN Senate May 07, 2019 CALIFORNIA LEGISLATURE 20192020 REGULAR SESSION Senate Bill No. 434Introduced by Senator ArchuletaFebruary 21, 2019 An act to add Section 5382 to the Civil Code, relating to common interest developments. LEGISLATIVE COUNSEL'S DIGESTSB 434, as amended, Archuleta. Common interest developments: managing agent: production of client property and client records upon termination of management agreement. Existing law, the Davis-Stirling Common Interest Development Act, governs the management and operation of common interest developments and defines a managing agent as a person who, for compensation or in expectation of compensation, exercises control over the assets of a common interest development. This bill would require a managing agent whose management agreement has been terminated to produce client property and client records within a specified period of time pursuant to a written request by a common interest development association, association in a format that the association can reasonably use, except as specified. The bill would define client property and client records for purposes of those provisions. Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: NO Local Program: NO
Amended IN Senate May 07, 2019
Amended IN Senate May 07, 2019
CALIFORNIA LEGISLATURE 20192020 REGULAR SESSION
Senate Bill No. 434
Introduced by Senator ArchuletaFebruary 21, 2019
Introduced by Senator Archuleta
February 21, 2019
An act to add Section 5382 to the Civil Code, relating to common interest developments.
LEGISLATIVE COUNSEL'S DIGEST
## LEGISLATIVE COUNSEL'S DIGEST
SB 434, as amended, Archuleta. Common interest developments: managing agent: production of client property and client records upon termination of management agreement.
Existing law, the Davis-Stirling Common Interest Development Act, governs the management and operation of common interest developments and defines a managing agent as a person who, for compensation or in expectation of compensation, exercises control over the assets of a common interest development. This bill would require a managing agent whose management agreement has been terminated to produce client property and client records within a specified period of time pursuant to a written request by a common interest development association, association in a format that the association can reasonably use, except as specified. The bill would define client property and client records for purposes of those provisions.
Existing law, the Davis-Stirling Common Interest Development Act, governs the management and operation of common interest developments and defines a managing agent as a person who, for compensation or in expectation of compensation, exercises control over the assets of a common interest development.
This bill would require a managing agent whose management agreement has been terminated to produce client property and client records within a specified period of time pursuant to a written request by a common interest development association, association in a format that the association can reasonably use, except as specified. The bill would define client property and client records for purposes of those provisions.
## Digest Key
## Bill Text
The people of the State of California do enact as follows:SECTION 1. Section 5382 is added to the Civil Code, to read:5382. (a) (1) Upon receipt of a written request by the association or its legal counsel to produce client property and client records, a managing agent of a common interest development whose management agreement has been terminated shall produce client property and client records to the person designated in the request as soon as reasonably practical after the managing agent receives the request, but in no event more than 30 days from either the effective date the management agreement was terminated or the date the managing agent received the request, whichever is later.(2) Notwithstanding paragraph (1), the managing agent and association may agree in writing to a longer period of time that the managing agent is required to produce client property and client records upon termination of the management agreement.(3) A dispute of the management agreement termination or fees shall not affect the managing agents duty to produce client property and client records within the time period specified in this subdivision.(b) A managing agent shall produce all client records in the form in which they have been kept by the managing agent or in a form which the managing agent reasonably believes will be usable by the association, and in a manner that is not unduly burdensome to the managing agent. a format that the association can reasonably use. The managing agent shall not be required to produce client records in more than one form. format.(c) A managing agent shall is not be required to produce a client records record only under one of the following circumstances:(1)The client records are not reasonably available because of undue burden or expense.(2)The client records include proprietary or other trade secret information developed by the managing agent for use in the managing agents management business.(3)The client records have been lost, damaged, altered, or overwritten as the result of routine good faith operation of an electronic information system.(1) The record has been lost or destroyed due to unforeseen circumstances outside of the managing agents control, including, but not limited to, corruption of electronically stored files due to viruses, malware, or a hardware malfunction against which the managing agent has taken reasonable precautions.(2) The record has been purged in accordance with a document retention policy that has been approved by the association board and that ensures the association can comply with subdivision (i) of Section 5210.(d) The managing agents obligation to honor all association confidences and to treat the business affairs and records of the association as confidential continues after termination of the mananagement management agreement. If information is sought by a third party through legal process, including subpoena or the discovery process, the managing agents obligations under this subdivision shall be satisfied if the managing agent gives notice to an officer of the association no later than 10 days after receipt of the subpoena, discovery request, or other legal process.(e) For purposes of this section, the following definitions apply: (1) Client property means the associations physical property, including, but not limited to, manuals for operation, maintenance or warranty of elevators, pool heaters, HVAC systems, security gate transponders, and pool keys.(2) Client records means hard files and electronically stored information maintained by the managing agent in the ordinary course of business that the managing agent is legally required to maintain or that is reasonably necessary for the associations continued operation, including, at a minimum, all items presented to an association board of directors for their consideration, except for items that are reasonably deemed proprietary by the managing agent. Client records does not include the following:(A) Working papers, internal communications, proprietary documents, or internal notes developed or created by the managing agent.(B) Records of telephone conversations or emails unless they previously have been included in a board packet or vendor or project file.
The people of the State of California do enact as follows:
## The people of the State of California do enact as follows:
SECTION 1. Section 5382 is added to the Civil Code, to read:5382. (a) (1) Upon receipt of a written request by the association or its legal counsel to produce client property and client records, a managing agent of a common interest development whose management agreement has been terminated shall produce client property and client records to the person designated in the request as soon as reasonably practical after the managing agent receives the request, but in no event more than 30 days from either the effective date the management agreement was terminated or the date the managing agent received the request, whichever is later.(2) Notwithstanding paragraph (1), the managing agent and association may agree in writing to a longer period of time that the managing agent is required to produce client property and client records upon termination of the management agreement.(3) A dispute of the management agreement termination or fees shall not affect the managing agents duty to produce client property and client records within the time period specified in this subdivision.(b) A managing agent shall produce all client records in the form in which they have been kept by the managing agent or in a form which the managing agent reasonably believes will be usable by the association, and in a manner that is not unduly burdensome to the managing agent. a format that the association can reasonably use. The managing agent shall not be required to produce client records in more than one form. format.(c) A managing agent shall is not be required to produce a client records record only under one of the following circumstances:(1)The client records are not reasonably available because of undue burden or expense.(2)The client records include proprietary or other trade secret information developed by the managing agent for use in the managing agents management business.(3)The client records have been lost, damaged, altered, or overwritten as the result of routine good faith operation of an electronic information system.(1) The record has been lost or destroyed due to unforeseen circumstances outside of the managing agents control, including, but not limited to, corruption of electronically stored files due to viruses, malware, or a hardware malfunction against which the managing agent has taken reasonable precautions.(2) The record has been purged in accordance with a document retention policy that has been approved by the association board and that ensures the association can comply with subdivision (i) of Section 5210.(d) The managing agents obligation to honor all association confidences and to treat the business affairs and records of the association as confidential continues after termination of the mananagement management agreement. If information is sought by a third party through legal process, including subpoena or the discovery process, the managing agents obligations under this subdivision shall be satisfied if the managing agent gives notice to an officer of the association no later than 10 days after receipt of the subpoena, discovery request, or other legal process.(e) For purposes of this section, the following definitions apply: (1) Client property means the associations physical property, including, but not limited to, manuals for operation, maintenance or warranty of elevators, pool heaters, HVAC systems, security gate transponders, and pool keys.(2) Client records means hard files and electronically stored information maintained by the managing agent in the ordinary course of business that the managing agent is legally required to maintain or that is reasonably necessary for the associations continued operation, including, at a minimum, all items presented to an association board of directors for their consideration, except for items that are reasonably deemed proprietary by the managing agent. Client records does not include the following:(A) Working papers, internal communications, proprietary documents, or internal notes developed or created by the managing agent.(B) Records of telephone conversations or emails unless they previously have been included in a board packet or vendor or project file.
SECTION 1. Section 5382 is added to the Civil Code, to read:
### SECTION 1.
5382. (a) (1) Upon receipt of a written request by the association or its legal counsel to produce client property and client records, a managing agent of a common interest development whose management agreement has been terminated shall produce client property and client records to the person designated in the request as soon as reasonably practical after the managing agent receives the request, but in no event more than 30 days from either the effective date the management agreement was terminated or the date the managing agent received the request, whichever is later.(2) Notwithstanding paragraph (1), the managing agent and association may agree in writing to a longer period of time that the managing agent is required to produce client property and client records upon termination of the management agreement.(3) A dispute of the management agreement termination or fees shall not affect the managing agents duty to produce client property and client records within the time period specified in this subdivision.(b) A managing agent shall produce all client records in the form in which they have been kept by the managing agent or in a form which the managing agent reasonably believes will be usable by the association, and in a manner that is not unduly burdensome to the managing agent. a format that the association can reasonably use. The managing agent shall not be required to produce client records in more than one form. format.(c) A managing agent shall is not be required to produce a client records record only under one of the following circumstances:(1)The client records are not reasonably available because of undue burden or expense.(2)The client records include proprietary or other trade secret information developed by the managing agent for use in the managing agents management business.(3)The client records have been lost, damaged, altered, or overwritten as the result of routine good faith operation of an electronic information system.(1) The record has been lost or destroyed due to unforeseen circumstances outside of the managing agents control, including, but not limited to, corruption of electronically stored files due to viruses, malware, or a hardware malfunction against which the managing agent has taken reasonable precautions.(2) The record has been purged in accordance with a document retention policy that has been approved by the association board and that ensures the association can comply with subdivision (i) of Section 5210.(d) The managing agents obligation to honor all association confidences and to treat the business affairs and records of the association as confidential continues after termination of the mananagement management agreement. If information is sought by a third party through legal process, including subpoena or the discovery process, the managing agents obligations under this subdivision shall be satisfied if the managing agent gives notice to an officer of the association no later than 10 days after receipt of the subpoena, discovery request, or other legal process.(e) For purposes of this section, the following definitions apply: (1) Client property means the associations physical property, including, but not limited to, manuals for operation, maintenance or warranty of elevators, pool heaters, HVAC systems, security gate transponders, and pool keys.(2) Client records means hard files and electronically stored information maintained by the managing agent in the ordinary course of business that the managing agent is legally required to maintain or that is reasonably necessary for the associations continued operation, including, at a minimum, all items presented to an association board of directors for their consideration, except for items that are reasonably deemed proprietary by the managing agent. Client records does not include the following:(A) Working papers, internal communications, proprietary documents, or internal notes developed or created by the managing agent.(B) Records of telephone conversations or emails unless they previously have been included in a board packet or vendor or project file.
5382. (a) (1) Upon receipt of a written request by the association or its legal counsel to produce client property and client records, a managing agent of a common interest development whose management agreement has been terminated shall produce client property and client records to the person designated in the request as soon as reasonably practical after the managing agent receives the request, but in no event more than 30 days from either the effective date the management agreement was terminated or the date the managing agent received the request, whichever is later.(2) Notwithstanding paragraph (1), the managing agent and association may agree in writing to a longer period of time that the managing agent is required to produce client property and client records upon termination of the management agreement.(3) A dispute of the management agreement termination or fees shall not affect the managing agents duty to produce client property and client records within the time period specified in this subdivision.(b) A managing agent shall produce all client records in the form in which they have been kept by the managing agent or in a form which the managing agent reasonably believes will be usable by the association, and in a manner that is not unduly burdensome to the managing agent. a format that the association can reasonably use. The managing agent shall not be required to produce client records in more than one form. format.(c) A managing agent shall is not be required to produce a client records record only under one of the following circumstances:(1)The client records are not reasonably available because of undue burden or expense.(2)The client records include proprietary or other trade secret information developed by the managing agent for use in the managing agents management business.(3)The client records have been lost, damaged, altered, or overwritten as the result of routine good faith operation of an electronic information system.(1) The record has been lost or destroyed due to unforeseen circumstances outside of the managing agents control, including, but not limited to, corruption of electronically stored files due to viruses, malware, or a hardware malfunction against which the managing agent has taken reasonable precautions.(2) The record has been purged in accordance with a document retention policy that has been approved by the association board and that ensures the association can comply with subdivision (i) of Section 5210.(d) The managing agents obligation to honor all association confidences and to treat the business affairs and records of the association as confidential continues after termination of the mananagement management agreement. If information is sought by a third party through legal process, including subpoena or the discovery process, the managing agents obligations under this subdivision shall be satisfied if the managing agent gives notice to an officer of the association no later than 10 days after receipt of the subpoena, discovery request, or other legal process.(e) For purposes of this section, the following definitions apply: (1) Client property means the associations physical property, including, but not limited to, manuals for operation, maintenance or warranty of elevators, pool heaters, HVAC systems, security gate transponders, and pool keys.(2) Client records means hard files and electronically stored information maintained by the managing agent in the ordinary course of business that the managing agent is legally required to maintain or that is reasonably necessary for the associations continued operation, including, at a minimum, all items presented to an association board of directors for their consideration, except for items that are reasonably deemed proprietary by the managing agent. Client records does not include the following:(A) Working papers, internal communications, proprietary documents, or internal notes developed or created by the managing agent.(B) Records of telephone conversations or emails unless they previously have been included in a board packet or vendor or project file.
5382. (a) (1) Upon receipt of a written request by the association or its legal counsel to produce client property and client records, a managing agent of a common interest development whose management agreement has been terminated shall produce client property and client records to the person designated in the request as soon as reasonably practical after the managing agent receives the request, but in no event more than 30 days from either the effective date the management agreement was terminated or the date the managing agent received the request, whichever is later.(2) Notwithstanding paragraph (1), the managing agent and association may agree in writing to a longer period of time that the managing agent is required to produce client property and client records upon termination of the management agreement.(3) A dispute of the management agreement termination or fees shall not affect the managing agents duty to produce client property and client records within the time period specified in this subdivision.(b) A managing agent shall produce all client records in the form in which they have been kept by the managing agent or in a form which the managing agent reasonably believes will be usable by the association, and in a manner that is not unduly burdensome to the managing agent. a format that the association can reasonably use. The managing agent shall not be required to produce client records in more than one form. format.(c) A managing agent shall is not be required to produce a client records record only under one of the following circumstances:(1)The client records are not reasonably available because of undue burden or expense.(2)The client records include proprietary or other trade secret information developed by the managing agent for use in the managing agents management business.(3)The client records have been lost, damaged, altered, or overwritten as the result of routine good faith operation of an electronic information system.(1) The record has been lost or destroyed due to unforeseen circumstances outside of the managing agents control, including, but not limited to, corruption of electronically stored files due to viruses, malware, or a hardware malfunction against which the managing agent has taken reasonable precautions.(2) The record has been purged in accordance with a document retention policy that has been approved by the association board and that ensures the association can comply with subdivision (i) of Section 5210.(d) The managing agents obligation to honor all association confidences and to treat the business affairs and records of the association as confidential continues after termination of the mananagement management agreement. If information is sought by a third party through legal process, including subpoena or the discovery process, the managing agents obligations under this subdivision shall be satisfied if the managing agent gives notice to an officer of the association no later than 10 days after receipt of the subpoena, discovery request, or other legal process.(e) For purposes of this section, the following definitions apply: (1) Client property means the associations physical property, including, but not limited to, manuals for operation, maintenance or warranty of elevators, pool heaters, HVAC systems, security gate transponders, and pool keys.(2) Client records means hard files and electronically stored information maintained by the managing agent in the ordinary course of business that the managing agent is legally required to maintain or that is reasonably necessary for the associations continued operation, including, at a minimum, all items presented to an association board of directors for their consideration, except for items that are reasonably deemed proprietary by the managing agent. Client records does not include the following:(A) Working papers, internal communications, proprietary documents, or internal notes developed or created by the managing agent.(B) Records of telephone conversations or emails unless they previously have been included in a board packet or vendor or project file.
5382. (a) (1) Upon receipt of a written request by the association or its legal counsel to produce client property and client records, a managing agent of a common interest development whose management agreement has been terminated shall produce client property and client records to the person designated in the request as soon as reasonably practical after the managing agent receives the request, but in no event more than 30 days from either the effective date the management agreement was terminated or the date the managing agent received the request, whichever is later.
(2) Notwithstanding paragraph (1), the managing agent and association may agree in writing to a longer period of time that the managing agent is required to produce client property and client records upon termination of the management agreement.
(3) A dispute of the management agreement termination or fees shall not affect the managing agents duty to produce client property and client records within the time period specified in this subdivision.
(b) A managing agent shall produce all client records in the form in which they have been kept by the managing agent or in a form which the managing agent reasonably believes will be usable by the association, and in a manner that is not unduly burdensome to the managing agent. a format that the association can reasonably use. The managing agent shall not be required to produce client records in more than one form. format.
(c) A managing agent shall is not be required to produce a client records record only under one of the following circumstances:
(1)The client records are not reasonably available because of undue burden or expense.
(2)The client records include proprietary or other trade secret information developed by the managing agent for use in the managing agents management business.
(3)The client records have been lost, damaged, altered, or overwritten as the result of routine good faith operation of an electronic information system.
(1) The record has been lost or destroyed due to unforeseen circumstances outside of the managing agents control, including, but not limited to, corruption of electronically stored files due to viruses, malware, or a hardware malfunction against which the managing agent has taken reasonable precautions.
(2) The record has been purged in accordance with a document retention policy that has been approved by the association board and that ensures the association can comply with subdivision (i) of Section 5210.
(d) The managing agents obligation to honor all association confidences and to treat the business affairs and records of the association as confidential continues after termination of the mananagement management agreement. If information is sought by a third party through legal process, including subpoena or the discovery process, the managing agents obligations under this subdivision shall be satisfied if the managing agent gives notice to an officer of the association no later than 10 days after receipt of the subpoena, discovery request, or other legal process.
(e) For purposes of this section, the following definitions apply:
(1) Client property means the associations physical property, including, but not limited to, manuals for operation, maintenance or warranty of elevators, pool heaters, HVAC systems, security gate transponders, and pool keys.
(2) Client records means hard files and electronically stored information maintained by the managing agent in the ordinary course of business that the managing agent is legally required to maintain or that is reasonably necessary for the associations continued operation, including, at a minimum, all items presented to an association board of directors for their consideration, except for items that are reasonably deemed proprietary by the managing agent. Client records does not include the following:
(A) Working papers, internal communications, proprietary documents, or internal notes developed or created by the managing agent.
(B) Records of telephone conversations or emails unless they previously have been included in a board packet or vendor or project file.