Rules of interpretation are important to address issues arising from vague language within an association’s governing documents, or from language within the governing documents that conflicts with the Davis-Stirling Act (“Act”) or the California Corporations Code.
Statutory Language Defers
If any statute uses language to the effect of “unless otherwise provided in the declaration or bylaws…” (i.e., Civ. Code § 4365(e).), the statute is meant to defer to the language in those governing documents of an association.
Statutory Language Controls
If any statute uses language to the effect of “notwithstanding any provision of the governing documents to the contrary…” (i.e., Civ. Code § 4230(a).) or “no governing documents shall prohibit….” (i.e., Civ. Code § 4705(a).), the language within the statute is controlling and overrides any contradictory language in an association’s governing documents.
Statutory Language is Silent
Provisions of the Act may be silent on whether they are intended to control or to defer to the language in an association’s governing documents. Those provisions may nevertheless control where they use the term “shall,” as that term is a word of command and “must be given a compulsory meaning.” (People v. O’Rourke (1932) 124 Cal.App. 752, 759.) For example, Civil Code Section 4910(a) states that “the board shall not take action on any item of business outside of a board meeting.” This language is controlling and would override any contradictory language in an association’s governing documents.
Conflicts Between Governing Documents
There may be conflicting language between an association’s governing documents (i.e., conflicts between the language in the declaration and the language in the bylaws). Those conflicts may be resolved through the application of the hierarchy of governing documents. (See “Hierarchy of Governing Documents” and Civ. Code § 4205.)
Interpretation of Declaration (“CC&Rs”)
California courts have established the following principles with respect to interpreting CC&Rs:
“The same rules that apply to interpretation of contracts apply to the interpretation of [CC&Rs].” (Chee v. Amanda Golt (2006) 143 Cal.App.4th 1360, 1377).
CC&Rs which are “enacted for the mutual benefit of [the] homeowners, are to be interpreted so as to give effect to the main purpose of the contract… and where a contract is susceptible of two interpretations, the courts shall give it such a construction as will make it lawful, operative, definite, reasonable and capable of being carried into effect… [and] avoid an interpretation which will make [the CC&Rs] extraordinary, harsh, unjust, inequitable or which would result in absurdity.” (Battram v. Emerald Bay (1984) 157 Cal.App.3d 1184, 1189.)
“Where two provisions appear to cover the same matter, and are inconsistent, the more specific provision controls over the general provision.” (Starlight Ridge South Homeowners Assn. v. Hunter-Bloor (2009) 177 Cal.App.4th 440, 447; Code Civ. Proc. § 1859.)
“We consider the [CC&Rs] as a whole and construe the language in context, rather than interpret a provision in isolation.” (Starlight Ridge South Homeowners Assn. v. Hunter-Bloor (2009) 177 Cal.App.4th 440, 447.)