HomeMy WebLinkAboutCT 96-01; Carlsbad Ranch Hotel Timeshare Resort; Tentative Map (CT) (4)DECLARATION OF COVENANTS. CONDITIONS, MID RESTRICTIONS
FOR
CONDOMINIUM INTERESTS IN GRAND PACIFIC PALISADES RESORT
TABLE OF CONTENTS
RECITALS 1
ARTICLE 1 3
DEFINITIONS 3
1.01 "Accessible Facilities/Amenities Units" 3
1.02 "Annexable Property" 3
1.03 "Annexable Property #1" (or Phase II Property) . . 3
1.04 "Annexable Property #2" (or Phase II Property) . . 3
1.05 "Annexation" 4
1.06 "Annexed Property" 4
1.07 "Annual Fixed Week/Floating Unit Vacation
Ownership" 4
1.08 "Annual Floating Week/Floating Unit Vacation
Ownership" 4
1.09 "Annual Owner" (or "Annual Vacation Ownership
Owner") 5
1.10 "Annual Ownership" (or "Annual Vacation
Ownership") 5
1.11 "Annual Vacation Ownership" 5
1.12 "Annual Vacation Ownership Owner" . 5
1.13 "Articles" 5
1.14 "Assessments" 5
1.15 "Assigned Unit" 5
1.16 "Assigned Unit Type" 5
1.17 "Assigned Use Week" 6
1.18 "Assigned Vacation Unit" (or "Assigned Unit") . . 6
1.19 "Assigned Vacation Unit Type" (or "Assigned Unit
Type") 6
1.20 "Association" 6
1.21 "Association General Use Real Property" 6
1.22 "Association Personal Property" 7
1.23 "Association Property" 7
1.24 "Association Real Property" 7
1.25 "Association Restricted Use Real Property" .... 7
1.26 "Association Rules and Regulations" 7
1.27 "Basic Expenses" 7
1.28 "Biennial Fixed Week/Floating Unit Vacation
Ownership" 8
1.29 "Biennial Floating Week/Floating Unit Vacation
Ownership" 9
1.30 "Biennial Owner" (or "Biennial Vacation Ownership
Owner") 9
1.31 "Biennial Ownership" (or "Biennial Vacation
Ownership") 9
1.32 "Biennial Vacation Ownership" 9
1.33 "Biennial Vacation Ownership owner" 10
1.34 "Board" 10
1.35 "Bonus Time/Rental Use" 10
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1.36 "Budget" 10
1.37 "Bylaws" 10
1.38 "Calendar" 10
1.39 "Check-in Day" 11
1.40 "Check-in Time" and "Check-out Time" 11
1.41 "Common Area" 11
1.42 "Common Furnishings" 11
1.43 "Condominium" 11
1.44 "Condominium Interest" 11
1.45 "Condominium Interest Owner" 11
1.46 "Condominium Ownership Operation" 11
1.47 "Condominium Plan" 11
1.48 "Condominium Unit" 12
1.49 "Declarant" 12
1.50 "Declaration" 12
1.51 "Declarant Annual Vacation Ownership" 12
1.52 "Declarant Biennial Vacation Ownership" 12
1.53 "Declaration Condominium Interest" ... 12
1.54 "Declarant Vacation Ownership" 12
1.55 "Designated Vacation Unit" 13
1.56 "Development" 13
1.57 "Distributable Net Proceeds" 13
1.58 "Even Use Year" 13
1.59 "Exchange Program" 13
1.60 "Exchange User" 13
1.61 "Facilities/Amenities Condominium" 14
1.62 "Facilities/Amenities Condominium Owner" . . . . 14
1.63 "Facilities/Amenities Condominium Owner's Personal
Prop-erty" 14
1.64 "Facilities/Amenities Condominiums Operation" . . 15
1.65 "Facilities/Amenities Condominiums Owner(s) Rules
and Regulations" 15
1.66 "Facilities/Amenities Unit" 15
1.67 "Facilities/Amenities Unit Designation Symbol" . . 16
1.68 "Fiscal Year" 16
1.69 "Fixed Week" 16
1.70 "Floating Unit" 16
1.71 "Floating Week" 16
1.72 "High Season" 16
1.73 "Hotel Owner(s) Use Rights Declaration" 16
1.74 "Improvements" 16
1.75 "Land" 17
1.76 "Maintenance Week" 17
1.77 "Managing Agent" 17
1.78 "Member" 17
1.79 Membership" 17
1.80 "Module" 17
1.81 "Module I" 17
1.82 "Module Ii" 17
1.83 "Module III" 17
1.84 "Mortgage" 17
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1
1.85 "Mortgagee" 17
1.86 "Night" 17
1.87 "Nondesignated Vacation Units" 17
1.88 "Ocean View Unit" 18
1.89 Ocean View Vacation Unit" (or "Ocean View Unit") . 18
1.90 "Odd Use Year" 18
1.91 "Original Deed" 18
1.92 "Owner" 18
1.93 "Ownership" 18
1.94 "Park View Unit" 18
1.95 "Park View Vacation Unit" (or "Park View Unit") . 18
1.96 "Permitted User" 18
1.97 "Phase" (or "Module") 19
1.98 "Phase I" (or "Module I") 19
1.99 "Phase II" (or "Module II") 19
1.100 "Phase III" (or "Module III") 19
1.101 "Phase I Property" 19
1.102 "Phase II Property" (or "Annexable Property #1")
19
1.103 "Phase III Property" (or "Annexable Property #2")
19
1.104 "Prime Summer Season" 19
1.105 "Project" 19
1.106 "Project Basic Expenses" 20
1.107 "Project Diagram" 20
1.108 "Project Special Expenses" 20
1.109 "Pro Rata Share" :..: . ... 20
1.110 "Purchase Agreement" 20
1.111 "Real Property" 20
1.112 "Rules and Regulations" 20
1.113 "Special Expenses" 21
1.114 "Sole Basic Expenses" 21
1.115 "Sole Special Expenses" 21
1.116 "Unit" 21
1.117 "Unit Type" 21
1.118 "Use Program" 21
1.119 "Use Week" 21
1.120 "Use Year" 21
1.121 "Vacation Condominium" 21
1.122 "Vacation Ownership" (or "Ownership") ...... 22
1.123 "Vacation Ownership Operation" 22
1.124 "Vacation Ownership Owner" (or "Owner") 22
1.125 "Vacation Ownership Use Program" (or "Use
Program") 22
1.126 "Vacation Unit" 23
1.127 "Vacation Unit Designation Symbol" 23
1.128 "Vacation Unit Type" (or "Unit Type") 23
1.129 "Week Day" . . . 23
1.130 "Weekend" 23
ARTICLE 2 23
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VARIOUS RIGHTS, OBLIGATIONS, AND RESTRICTIONS RELATED
TO OWNERSHIP, USE AND POSSESSION, MAINTENANCE, TAXES,
EXPENSES, MORTGAGING, AND LEASING AND RENTING 23
2.01. Right of Vacation Ownership Owners to Use Vacation
Units, Related Rights and Duties, and Prohibitions ... 23
a. Exclusive Right to Use a Vacation Unit and
Common Furnishings Therein 23
b. Types of Vacation Ownerships 24
c. Nonexclusive Right to Use Accessible Facilities/
Amenities Units 24
d. Nonexclusive Right to Go Over and Upon
Association General Use Property to Access
Vacation Unit and Facilities/Amen-ities
Units 25
e. "Day-Use" 25
f. Should an Owner Be Prevented from Using and
Possessing a Vacation Unit 25
g. Upkeep of Property. 25
h. No Use or Occupancy Permitted if Owner is in
Breach of Obligations 26
i. Limited Period of Use and Occupancy 26
j. Use by Others; Owner Still Responsible. ... 26
k. Failure to Vacate 26
1. Maintenance Week. 28
2.02 Right of Facilities/Amenities Condominium Owner to
Use Facilities/Amenities Unit and Association
General Use Property 28
2.03 Right to Lease/Rent Vacation Units 28
a. Designated Vacation Unites 28
1. By Owner other than Declarant. .... 28
2. By Association—"Bonus Time/Rental
Use" 28
b. Nondesignated Vacation Units - Declarant's
Right to Rent 30
c. All Lease or Rental Agreements to Be in
Writing 30
2.04 Right of Facilities/Amenities Condominium Owner to
Lease/ Rent Owner's Facilities/Amenities Unit. . . 30
2.05 Overall Responsibility for Respective Operations
within Project 30
a. Responsibility for the Project, Association
Personal Property, and Vacation Ownership
Operation 30
b. Responsibility for the Facilities/Amenities
Condomi-niums Operation 31
2.06 Responsibility for Maintenance 31
a. Association Property. 31
b. Facilities/Amenities Condominium Owner's
Personal Property in Facilities/Amenities
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Units. . . 31
c. Common Furnishings in Vacation Units. ... 31
d. Right of Association to Perform Maintenance
upon a Facilities/Amenities Condominium
Owner's Nonperformance 32
e. Arbitration of Disputes 32
2.07 Allocation of Association Expenses and Sharing of
Certain Expenses with Hotel Project 32
a. General Theory and Basis for Allocation of
Condo-minium Owners Association Expenses and
Assessments 32
1. Sole Basic and Special Expenses. . 32
2. Project Basic and Special
Expenses 33
b. Board to Determine Expense Type 33
c. Arbitration of Disputes 33
d. Sharing of Certain Expenses With Hotel. ... 34
2.08 Allocation of Distributable Net Proceeds Among
Owners 34
a. General 34
b. Allocation Determination 34
c. "Fair and Equitable Basis" 35
d. Payment Subject to Prior Claims 35
2.09 Owner's Obligations to Pay Taxes 35
2.10 Right to Mortgage Condominium Interest and First
Mortgagee Safety 35
2.11 Right to Enter Other Condominium Units 35
2.12 Easements for Encroachments. 36
2.13 Easements and Certain Other Rights Reserved by
Declarant to Which Owners Take Subject 36
a. Easements Reserved by Declarant with
Respect to Development 36
b. Owner's Acknowledgment of Easement
Rights 38
c. Indemnification of Owners. 38
2.14 Easements in Favor of Hotel Owners and Users. . . 38
2.15 Nonseverability of Components of Condominium upon
Transfer of a Condominium Interest 38
2.16 Subordination of Tenancy-in-Common Attributes to
Declaration and Prohibition Against Partition of
Condominium Units 39
2.17 Common Furnishings and Association Property. ... 39
2.18 Limitations on Partition of Common Area 39
2.19 Specific Use Restrictions. 40
a. Use of Vacation Units 40
b. No Nuisances. 40
c. Signs 41
d. No Advertising Materials. 41
e. No Animals. 41
f. Garbage and Refuse Disposal 41
g. Antennae; External Fixtures 41
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h. No clotheslines 41
i. No Car Maintenance. 41
2.20 Indemnification of Associations and Owners. ... 41
ARTICLE 3 42
PROTECTION OF THE REAL PROPERTY, ASSOCIATION PERSONAL
PROPERTY, COMMON FURNISHINGS, AND FACILITIES/AMENITIES
CONDOMINIUM OWNERS' PERSONAL PROPERTY FROM LIENS 42
3.01 Real Property, Association Personal Property,
Common Furnishings, and Any Facilities/Amenities
Condominium Owner's Personal Property to Be
Maintained Free of Liens 42
3.02 Association to Defend Certain Actions. 43
3.03 Payment of Lien. 43
3.04 Reimbursement to Association 44
ARTICLE 4 44
THE ASSOCIATION 44
4.01 Association. 44
4.02 Membership in Association 44
4.03 Transfer of Membership 44
4.04 Classes of Membership. 45
a. With Respect to Matters Pertaining to Only
the Project and/or the Association
Personal Property 45
1. Class "A" Membership 45
2. Class "B" Membership 45
3. Class "C" Membership. 45
4. Class "D" Membership. 46
b. With Respect to Matters Pertaining to Only the
Vacation Ownership Operation 46
4.05 Member Voting: Standard Quorum and Vote
Required 46
a. With Respect to Matters Pertaining to Only the
Project and/or Association Personal Property.
46
1. Where Class "C" Membership Has Not Yet
Been Converted to Class "A" and/or Class
"B" Membership 47
2. Where Class "C" Membership Has Been
Converted to Class "A" and/or Class "B"
Membership 47
b. With Respect to Matters Pertaining to Only the
Vacation Ownership Operation 48
1. Where Class "C" Membership Has Not Yet
Been Converted to Class "A" and/or Class
"B" Membership 48
2. Where Class "C" Membership Has Been
Converted to Class "A" and/or Class "B"
Membership 48
c. Each Member to Vote 49
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4.06 Procedural Rules 49
ARTICLE 5 49
ASSOCIATION'S RIGHTS, POWERS, AND DUTIES;
AND MANAGING AGENT 49
5.01 General Rights, Powers, and Duties 49
a. Administration and Services 49
b. Conveyance of Association Property to
Association 49
c. Power of the Board of Directors 49
d. Vesting of Rights, Powers, and Duties. ... 49
5.02 Specific Rights, Powers, and Duties of the
Association and Services to the Owners 50
a. Delegate Authority 50
b. Enter Contracts 50
c. Borrow Money. 50
d. Establish Rules and Regulations 50
e. Right to Enter. 50
f. Maintain and Repair Association Property,
Common Area and Common Furnishings 51
g. Pay Taxes and Assessments 51
h. Provide and Pay for Utilities 51
i. Enforce Declaration, Bylaws, and Rules and
Regulations 51
j. Levy and Collect Assessments, Pay Expenses,
and Change Fiscal Year 52
k. Obtain and Pay Cost of Legal and Accounting
Services 52
1. Obtain and Pay Cost of Insurance 52
m. Maintain Bank Accounts 52
n. Prepare and Distribute Financial Information . 52
1. Prepare Budget 52
2. Prepare Annual Report 53
0. Provide Minutes and Agenda 53
p. Prepare Statement of Assessment
Enforcement Policy 54
q. Issue Statements of Status 54
r. Compile Register 54
s. Do Other Necessary or Proper Acts 54
5.03 Right, Power, and Duty to Engage Managing Agent . 55
a. Delegation of Authority 55
b. Term 55
c. Termination for Cause 55
d. Resignation 55
e. Enumeration of Powers and Duties 55
f. Compensation 55
g. Record Maintenance 56
h. Reports 56
1. Fidelity Bonding 56
j. Errors and Omissions Insurance 56
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k. Right of Entry 56
1. Employment of Subagents 56
m. Authority to Administer Vacation
Ownership Use Program 56
n. Limitation on Powers of the Managing Agent . . 56
5.04 Limited Liability 57
ARTICLE 6 58
ASSESSMENTS AND PERSONAL CHARGES 58
6.01 Creation of Personal Obligations; Purpose of
Assessments; Theory and Basis for Allocation of
Association Expenses and Assessments; and
Apportionment of Assessments Among Vacation
Ownership Owners 58
a. Creation of Personal Obligations 58
b. Purpose of Assessments 58
c. Theory and Basis for Allocation of Association
Expenses and Assessments. 59
d. Apportionment of Assessments Among Vacation
Owner-ship Owners 59
6.02 Regular Annual Assessments 60
a. Purpose of Regular Annual Assessments .... 60
b. Preparation and Adoption of Final Budget and
Determination of Aggregate Regular Annual
Assessments Determination 60
c. Allocation and Levy of Regular Annual
Assessments among Owners 60
d. Notice of Assessment, Due Date(s), Delinquency
Date(s), and Method of Payment 60
e. Commencement of Accrual of Regular Annual
Assessments ..... 61
f. Excess Collections 61
g. Monetary Limitations on Regular Annual
Assessments 61
1. With Respect to Assessments Pertaining to
Only the Project and/or Association
Personal Property: 62
2. With Respect to Assessments Pertaining to
Only the Vacation Ownership Operation . . 62
6.03 Special Assessments . 62
a. Purpose 62
b. How Special Assessments Imposed 63
1. With Respect to Assessments Pertaining to
Only the Project and/or Association
Personal Property 63
2. With Respect to Assessments Pertaining to
Only the Vacation Ownership Operation . . 64
3. Exceptions 64
c. Method of Levy 64
1. Where Levy Is Against All Condominium
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Interest Owners or all Vacation Ownership
Owners 65
2. Where Individual Special Assessment Is In-
volved 65
d. Notice of Assessment, Due Date(s), Delinquency
Date(s), and Method of Payment 65
6.04 Capital Needs Assessments 66
a. Purpose 66
b. How Capital Needs Assessments Imposed .... 66
c. Method of Levy 66
d. Notice of Assessment, Due Date(s), Delinquency
Date(s), and Method of Payment 67
6.05 Personal Charges 67
a. Purpose 67
b. Payment and Delinquency 68
ARTICLE 7 68
ENFORCEMENT OF RESTRICTIONS 68
7.01 General Provisions 68
a. General Power and Right to Bring Actions ... 68
b. Rights and Remedies Cumulative 69
c. Association May Delegate 69
d. Limited Forfeiture Rights 69
7.02 Certain Specific Enforcement Powers and Rights . . 69
a. Suspension of Rights and Privileges for Failure to
Pay Assessments or Other Charges 69
1. General. 70
2. Required Procedures. 71
3. Limited Exception When Violation Is for
Failure to Pay Assessment or
Other Charges 71
c. Continuing Lien to Secure Payment of
Assessments 71
1. Lien Creation 71
2. Procedure for Enforcement of Lien. ... 72
(b) Recording of Notice of Default
and Lien 72
(c) Lien Foreclosure 73
(d) Proceeds from Lien
Foreclosure 74
(e) Title of Foreclosure
Purchaser 74
(f) Release of Lien 74
3. Lien Priority and First Mortgages .... 75
ARTICLE 8 75
ASSOCIATION INSURANCE 75
8.01 Required Policies 75
a. Fire and Extended Coverage on All Condominium
Owners Association Property and Common
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Furnishings 75
b. Liability Insurance 75
c. Fidelity Bond 76
d. Association Officer and Director Insurance . . 76
e. Workmen's Compensation Insurance 76
f. Loss of Income Insurance. 76
g. Any Other Insurance 77
8.02 Insurance Procedures 77
a. General 77
b. Notice of Cancellation 77
c. Annual Review of Policies 77
d. Payment of Premiums 77
8.03 Fire and Extended Coverage on All
Facilities/Amenities Condominium Owners1 Personal
Property 77
ARTICLE 9 77
DAMAGE TO OR DESTRUCTION OF PROJECT 77
9.01 When Duty to Repair and Restore Project Is Man-
datory 77
9.02 When Duty to Repair and Restore Project Is to Be
Determined by Owners 78
a. If Owners and Mortgagees Determine to Repair and
Restore the Project, Association Personal Property,
and Common Furnishings 78
b. If Owners and Mortgagees Determine Not to
Repair and Restore the Project,
Association Personal Property,
and the Common Furnishings 79
9.03 Damage or Destruction of Association Personal
Property Only 79
9.04 Damage or Destruction of Common Furnishings Only . 79
9.05 Distribution of Distributable Net Proceeds from
Insurance Proceeds 79
ARTICLE 10 80
CONDEMNATION 80
10.01 Definitions 80
10.02 Determination of Total Taking to Be Made by
Owners 80
10.03 Board to Represent Owners in Proceedings 81
10.04 Repair on Partial Taking 81
10.05 Distribution of Distributable Net Proceeds from
Condemnation Award 81
ARTICLE 11 82
SALE OF ALL ASSOCIATION PROPERTY AND ALL COMMON
FURNISHINGS 82
11.01 When Condominium Interest Owners Shall Have Been
Deemed to Have Determined to Sell All Association
Property and All Common Furnishings. ....... 82
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a. On Destruction or Condemnation of Project ... 82
b. By Vote After December 31, 2068 82
11.02 Procedures Relating to Sale of All Association
Property All Common Furnishings 82
a. General Power and Authority Granted to
Association 83
b. Grant of Special Power of Attorney 83
c. Property to Be Offered for Sale 83
d. Property to Be Appraised 84
e. Sale Price Factors 84
f. Petition for Sale 84
g. Distribution of Net Proceeds from Sale .... 84
h. Arbitration of Disputes 84
ARTICLE 12 85
SPECIAL PROVISIONS FOR ENFORCEMENT OF DECLARANT'S OBLIGATIONS 85
12.01 General 85
12.02 Periodic Statements Required from Declarant ... 85
12.03 Required Board Discussion and Vote 86
12.04 Board Action to Enforce Declarant's Obligations . 86
12.05 Sole Director Action to Enforce Declarant's
Obligations 86
12.06 Arbitration with Respect to Question of Declarant's
Fulfillment of Obligation(s) . 87
ARTICLE 13 87
PROJECT PHASING AND ANNEXATION PROCEDURE 87
13.01 Declarant's Right to Phase, Vary Phasing, or
Refrain from Phasing 87
13.02 Annexation in Connection with Phasing 88
a. Declarant's Right to Annex. 88
b. How Annexation Accomplished 88
13.03 Possible Impact and Effects of Subsequent
Development 88
13.04 Possible Discontinuation of Construction 88
a. General 88
b. Special Power Of Attorney Granted to
Association to Change Legal Description. . . 89
c. Amendment 90
d. Time Limit(s) for Annexation(s) 90
1. Annexation of Annexable Property #1. .90
2. Annexation of Annexable Property #2. .90
ARTICLE 14 90
DESIGNATION OF VACATION UNITS TO USE PROGRAM 90
14.01 Designated Vacation Units 90
14.02 Nondesignated Units 91
14.03 Initially Designated Units. 91
14.04 Subsequent Designation of Nondesignated Units. . 91
14.05 Procedure for Designating Nondesignated Units. . 91
14.06 Reservation Safeguards for Owners of Annual and
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Biennial Floating Week/Floating Unit Vacation
Ownerships. 92
ARTICLE 15 93
SPECIAL PROVISIONS REQUIRED BY CITY OF CARLSBAD 93
15.01 General Enforcement by the City 93
15.02 Failure of Association to Maintain Common Area
Lots and Easements. 93
15.03 Special Assessments Levied by the City. .... 93
15.04 Notices of Public Hearing from City 94
ARTICLE 16 95
16.01 Amendment of Declaration 95
a. Where Class "C" Membership Has Not Yet Been
Converted to Class "A" and/or Class "B"
Membership. 95
b. Where Class "C" Membership Has Been Converted to
Class "A" and/or Class "B" Membership .... 95
c. Other Conditions and Terms 95
d. Protection of Beneficiaries of First Deeds of
Trust 95
e. Protection of Declarant 97
16.02 Term and Earlier Termination of Declaration ... 97
a. Term of Declaration 97
b. Earlier Termination of Declaration 97
c. Survival of Certain Provisions and Association 97
16.03 Notices 97
16.04 Notification of Sale of Owner's Vacation
Ownership 98
16.05 Indemnification of Directors, Officers, Employees, and
Other Agents 98
16.06 Severability and the Rule Against Perpetuities . . 98
16.07 Interpretation 98
16.08 No Waiver 98
16.09 Personal Covenant 98
16.10 Arbitration of Disputes 99
16.11 Attorneys' Fees And Costs 99
16.12 Successors 99
EXHIBIT "A": Calender of Use Weeks 101
EXHIBIT "B": Project Diagram for Grand Pacific Palisades. . 102
EXHIBIT "C": Description of Annexable Property #1 103
EXHIBIT "D": Description of Annexable Property #2 104
EXHIBIT "E": Declaration of Annexation 105
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Biennial Floating Week/Floating Unit Vacation
Ownerships. 92
ARTICLE 15 93
SPECIAL PROVISIONS REQUIRED BY CITY OF CARLSBAD 93
15.01 General Enforcement by the City 93
15.02 Failure of Association to Maintain Common Area
Lots and Easements. 93
15.03 Special Assessments Levied by the City. .... 93
15.04 Notices of Public Hearing from City 94
ARTICLE 16 95
16.01 Amendment of Declaration 95
a. Where Class "C" Membership Has Not Yet Been
Converted to Class "A" and/or Class "B"
Membership. 95
b. Where Class "C" Membership Has Been Converted to
Class "A" and/or Class "B" Membership .... 95
c. Other Conditions and Terms 95
d. Protection of Beneficiaries of First Deeds of
Trust 95
e. Protection of Declarant 97
16.02 Term and Earlier Termination of Declaration ... 97
a. Term of Declaration 97
b. Earlier Termination of Declaration ...... 97
c. Survival of Certain Provisions and Association 97
16.03 Notices . 97
16.04 Notification of Sale of Owner's Vacation
Ownership 98
16.05 Indemnification of Directors, Officers, Employees, and
Other Agents 98
16.06 Severability and the Rule Against Perpetuities . . 98
16.07 Interpretation 98
16.08 No Waiver 98
16.09 Personal Covenant 98
16.10 Arbitration of Disputes 99
16.11 Attorneys' Fees And Costs 99
16.12 Successors. 99
EXHIBIT "A": Calender of Use Weeks 101
EXHIBIT "B": Project Diagram for Grand Pacific Palisades. . 102
EXHIBIT "C": Description of Annexable Property #1 103
EXHIBIT "D": Description of Annexable Property #2 104
EXHIBIT "E": Declaration of Annexation 105
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DECLARATION OF COVENANTS. CONDITIONS. AND RESTRICTIONS
FOR
CONDOMINIUM INTERESTS IN GRAND PACIFIC PALISADES RESORT
This DECLARATION OF COVENANTS, CONDITIONS, AND RESTRICTIONS
FOR CONDOMINIUM INTERESTS IN GRAND PACIFIC PALISADES RESORT (the
"Declaration") , is made on , 1998, by Grand Pacific
Palisades LLC, a California limited liability company (the
"Declarant") , with reference to the following facts, and is as
follows:
RECITALS
A. Declarant is the owner of certain real property located
at , Carlsbad, California, legally described
as:
Lot 2 of Carlsbad Ranch Hotel and Timeshare Resort C.T.
96-01, according to Map No. in the City of
Carlsbad, County of San Diego, State of California, filed
in the Office of the County Recorder of San Diego County
on , 1998 (the "Land") .
B. Declarant has constructed, or is in the process of
constructing, upon the Land a four (4)-building condominium project
consisting of: (i) 161 Vacation Condominiums, in which Declarant
will offer for sale, and sell, Vacation Ownerships (time-share
estates); and (ii) 14 Facilities/Amenities Condominiums which will
be retained by Declarant (collectively known as "the Grand Pacific
Palisades Resort" or sometimes as simply the "Project").
C. The Declarant presently intends to develop the Project in
three (3) Phases (also known as Modules). Phase I is presently
intended to consist of the construction upon the Land of 71
Vacation Condominiums and the 14 Facilities/Amenities Condominiums.
Phase II is presently intended to consist of the construction upon
the Land of 72 Vacation Condominiums. Phase III is presently
intended to consist of the construction upon the Property of the
final 18 Vacation Condominiums upon the Land. The location upon
the Land of each such Phase is as delineated on the Condominium
Plan.
D. The foregoing Project, together with the hotel as
constructed, or to be constructed, on a separate lot adjoining the
Land, is part of the larger resort development known as "Grand
Pacific Palisades Resort and Hotel."
E. By this Declaration, Declarant intends to establish a
common scheme and general plan of restrictions for the benefit of
all Condominium Interest Owners in the Project relating to: (i) the
administration, management, and operation of the Vacation Ownership
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Operation, including the use, occupancy, enjoyment, clean-up, and
renting of the Vacation Units; (ii) the purchase, ownership,
holding, conveyance, mortgaging, and encumbering of each Vacation
Ownership; (iii) the administration, management, and operation of
the Facilities/Amenities Condominiums Operation, including the use,
occupancy, enjoyment, clean-up, and leasing of the Facilities/
Amenities Units; (iv) the purchase, ownership, holding, conveyance,
mortgaging, and encumbering of each Facilities/Amenities
Condominium, and (v) the use, maintenance, upkeep, repair,
restoration, and replacement of the Association Property.
(Each of the terms used in the foregoing Recital paragraphs,
with capitalized first letters, is defined in Article 1 below.)
NOW, THEREFORE, in furtherance of the foregoing intent,
Declarant hereby declares that: (i) the Vacation Ownership
Operation shall be administered, managed and operated, (ii) each
Vacation Unit shall be used, occupied, enjoyed, kept clean, and
rented, (iii) the Common Furnishings shall be used, maintained,
kept clean, repaired, restored, and/or replaced, (iv) each Vacation
Ownership interest in a Vacation Condominium shall be purchased,
owned, held, conveyed, mortgaged and encumbered, (v) the
Facilities/Amenities Condominium Ownership Operation shall be
administered, managed, and operated, (vi) each Facilities/Amenities
Unit shall be used, occupied, enjoyed, and kept clean, (vii) each
Facilities/Amenities Condominium Interest shall be purchased,
owned, held, conveyed, mortgaged and encumbered, and (viii) the
Association Property shall be used, maintained, kept clean,
repaired, restored, and/or replaced, all as subject to each of the
covenants, conditions, and restrictions set forth in this
Declaration, as this Declaration may from time to time be amended,
and any Rules and Regulations which may be made pursuant to this
Declaration, all of which covenants, conditions, restrictions, and
rules and regulations are hereby declared to be in furtherance of
a common scheme and general plan established for the purpose of
enhancing the value, desirability, and enjoyment of the Real
Property, each Vacation Condominium, each Facilities/Amenities
Condominium, each Vacation Unit, each Facilities/Amenities Unit,
each Vacation Ownership in a Vacation Condominium, and each and
every interest therein. All such covenants, conditions,
restrictions, and rules and regulations are, in accordance with
Section 1468 of the California Civil Code, made for the direct
benefit of the Real Property, including each Facilities/Amenities
Condominium, each Vacation Condominium, each Facilities/Amenities
Unit, each Vacation Unit, each Vacation Ownership in a Vacation
Condominium, and each and every interest therein, and shall
constitute covenants running with the land and equitable servitudes
and liens, and shall be binding upon, and shall be for the benefit
of, the Real Property, including each Vacation Condominium, each
Facilities/Amenities Condominium, each Vacation Condominium, each
Vacation Unit, each Facilities/Amenities Unit, each Vacation
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(August 31, 1998) 2
Ownership in a Vacation Condominium, and each and every interest
therein, and shall further be binding upon, and shall inure to the
benefit of, and be enforceable by, the Association, the Declarant,
and all Condominium Interest Owners, including without limitation,
any and all heirs, executors, administrators, successors, and
assigns, including lessees and renters, of any such parties. Each
Condominium Interest Owner, by virtue such Owner's accepting a con-
veyance of, or by otherwise owning a Vacation Ownership, including
Declarant as to all Declarant Condominium Interests, shall be
deemed to have covenanted and agreed to faithfully perform each and
every obligation required to be performed by such Condominium
Interest Owner under this Declaration, the Bylaws, and any Rules
and Regulations made pursuant to this Declaration, including
without limitation, the payment to the foregoing Association of any
and all Assessments imposed hereunder and other moneys owing to it;
and each such Condominium Interest Owner further shall be deemed to
have covenanted and agreed that such Association shall have all of
the rights, powers, duties, and remedies set forth in this
Declaration. (Each of the foregoing terms, with capitalized first
letters, is defined in Article 1 below.)
ARTICLE 1
DEFINITIONS
In addition to other definitions provided for in this Declara-
tion, the following terms, as used herein, shall have the following
meanings:
1.01 "Accessible Facilities/Amenities Units" means the
following, and only the following, Facilities/Amenities Units: the
Lobby and Front Desk Unit (excluding the marketing desk in lobby),
the Office Behind Front Desk Unit , the Gym Unit, and the Adult
Pool, Spa and Pool Deck Unit, each as delineated on the Condominium
Plan, and each of which, each Vacation Ownership Owner has the
nonexclusive right to access, use for its respective intended
purpose, and/or visit, pursuant to the terms of such Owner's deed,
this Declaration, and the Rules and Regulations.
1.02 "Annexable Property" means either Annexable Property #1
or Annexable Property #2, or both of them.
1.03 "Annexable Property #1" (or Phase II Property) means that
portion of the Land owned by Declarant, legally described on
Exhibit "C" attached hereto and made a part hereof, which Declarant
intends to annex to the Phase I Property as part of Phase II of the
Development.
1.04 "Annexable Property #2" (or Phase II Property) means that
portion of the Land owned by Declarant, legally described on
Exhibit "D" attached hereto and made a part hereof, which Declarant
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(August 31, 1998) 3
intends to annex to the combined Phase I and Phase II Property as
part of Phase III of the Development.
1.05 "Annexation" means the process of annexing Annexable
Property #1 to the Phase I Property, and Annexable Property #2 to
the combined Phase I and Phase II Properties, imposing this
Declaration thereon, constructing vacation resort and related
Improvements thereon, conveying such Annexable Property to the
Association, and offering for sale and selling Vacation Ownerships
therein.
1.06 "Annexed Property" means Annexable Property #1 or
Annexable Property #2, after either of such Annexable Properties
has been annexed to the Phase I, or the combined Phase I and Phase
II, Real Property.
1.07 "Annual Fixed Week/Floating Unit Vacation Ownership"
means a "time-share estate" as defined in California Business and
Professions Code Section 11003.5, being here comprised basically
of: One; an undivided I/51th fee title interest as a tenant-in-
common in a Vacation Condominium; Two; subject to the terms and
conditions of the Declaration and the Rules and Regulations, the
exclusive right to use and occupy an Ocean View Vacation Unit or a
Park View Vacation Unit of a particular Vacation Unit Type, and the
Common Furnishings in such Vacation Unit, together with; (i) the
nonexclusive right to access, use for their respective intended
purposes, and/or visit, the Lobby and Front Desk Unit (excluding
the marketing desk in lobby), the Office Behind Front Desk Unit,
the Gym Unit, and the Adult Pool, Spa and Pool Deck Unit (called
the "Accessible Facilities/Amenities Units"), each as delineated on
the Condominium Plan, together with (ii) the nonexclusive right to
go to, from, over, upon, under, across and through (as may be
applicable) the Association General Use Real Property, as such is
delineated on the Condominium Plan, in order to have ingress and
egress to and from the foregoing Vacation Unit and each such
Accessible Facilities/Amenities Unit, all for a Fixed Week in each
Use Year; with Declarant's reserving, however, from One and Two
above, for Declarant, certain easements and other rights; and
Three; membership for each Vacation Ownership Owner thereof in the
Association.
1.08 "Annual Floating Week/Floating Unit Vacation Ownership"
means a "time-share estate" as defined in California Business and
Professions Code Section 11003.5, being here comprised basically of
One: an undivided I/51th fee title interest as a tenant-in-common
in a Vacation Condominium; Two: subject to the terms and conditions
of the Declaration and the Rules and Regulations, the exclusive
right to use and occupy an Ocean View Vacation Unit or a Park View
Vacation Unit of a particular Vacation Unit Type, and the Common
Furnishings in such Vacation Unit, together with: (i) the
nonexclusive right to access, use for their respective intended
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(August 31. 1998) 4
purposes, and/or visit, the Lobby and Front Desk Unit (excluding
the marketing desk in lobby), the Office Behind Front Desk Unit,
the Gym Unit, and the Adult Pool, Spa and Pool Deck Unit (called
the "Accessible Facilities/Amenities Units") , each as delineated on
the Condominium Plan, together with (ii) the nonexclusive right to
go to, from, over, upon, under, across and through (as may be
applicable) the Association General Use Real Property, as such is
delineated on the Condominium Plan, in order to in order to have
ingress and egress to and from the foregoing Vacation Unit and each
such Facilities/ Amenities Unit, all for a Use Week, during either
High Season or Prime Summer Season (as may be the case) in each Use
Year, upon the condition that, before the occurrence of any such
use and/or occupancy, such Vacation Unit and Use Week shall have
first been reserved by the Vacation Ownership Owner in accordance
with the applicable provisions of this Declaration and the
Association Rules and Regulations; with Declarant's reserving,
however, from One and Two above, for Declarant, certain easements
and other rights; and Three; membership for each Vacation Ownership
Owner thereof in the Association.
1.09 "Annual Owner" for "Annual Vacation Ownership Owner")
means a Vacation Ownership Owner of either an Annual Fixed
Week/Floating Unit Vacation Ownership, or an Annual Floating
Week/Floating Unit Vacation Ownership.
1.10 "Annual Ownership" for "Annual Vacation Ownership") means
either an Annual Fixed Week/Floating Unit Vacation Ownership, or an
Annual Floating Week/Floating Unit Vacation Ownership.
1.11 "Annual Vacation Ownership" means this same as "Annual
Ownership" as defined in Section 1.10.
1.12 "Annual Vacation Ownership Owner" means the same as
"Annual Owner" as defined in Section 1.09.
1.13 i*Articles" means the Articles of Incorporation of the
Association, which Articles have been, or shall be, filed in the
office of the California Secretary of State, as same may be amended
from time to time.
1.14 "Assessments" means, collectively, the following types of
financial charges which may be imposed upon the Owners by the
Association, as described in Article 6 hereof: Regular Annual
Assessments, Special Assessments, and Capital Needs Assessments.
1.15 "Assigned Unit" means the same as "Assigned Vacation
Unit" as defined in Section 1.18.
1.16 "Assigned Unit Type" means the same as "Assigned Vacation
Unit Type" as defined in Section 1.19.
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(August 31, 1998)
1.17 "Assigned Use Week" means that particular Use Week to
which a Vacation Ownership Owner is entitled to occupancy of an
Assigned Vacation Unit as either: (i) specified in such Owner's
Original Deed (or subsequent deed, if a successive Owner), in the
case of an Owner of an Annual or Biennial Fixed Week/Floating Unit
Vacation Ownership, or (ii) assigned to such Owner by the
Association (upon a "first-reserved, first-served basis") in
accordance with the applicable provisions of the Association Rules
and Regulations, in the case of an Owner of an Annual or Biennial
Floating Week/Floating Unit Vacation Ownership.
1.18 "Assigned Vacation Unit" (or "Assigned Unit") means a
particular Vacation Unit, of an Assigned Vacation Unit Type, to
which a Vacation Ownership Owner (or his Permitted User) is
entitled to exclusive use and occupancy for a Use Week, which has
been assigned to such Owner by the Association (upon a "first-
reserved, first-served basis") in accordance with the applicable
provisions of the Association Rules and Regulations.
1.19 "Assigned Vacation Unit Type" (or "Assigned Unit Type")
means that particular Vacation Unit Type to which a Vacation
Ownership Owner is entitled to use and occupy during such Owner's
Use Week as is specified in such respective Owner's Original Deed
(or subsequent deed, if a successor Owner).
1.20 "Association" means the GRAND PACIFIC PALISADES OWNERS
ASSOCIATION, INC., a California nonprofit mutual benefit corp-
oration, the members of which shall be all Condominium Interest
Owners.
1.21 "Association General Use Real Property" means that
certain Association Real Property, delineated as such on the
Condominium Plan, to, from, over, upon, under, across, and through
(as may be applicable) which: (i) each Vacation Ownership Owner and
his or her family members and guests may go in order to access such
Owner's Assigned Vacation Unit, and to access, use for their
respective intended purposes, and/or visit, each Accessible
Facilities/Amenities Unit as delineated on the Condominium Plan,
during such Owner's respective Assigned Use Week, or during any
time such Owner is a renter of a Vacation Unit, or is otherwise a
guest occupying a Vacation Unit; (ii) each such Vacation Ownership
Owner, or each invitee of Declarant, or prospective purchaser of a
Vacation Ownership from Declarant, who simply visits the Project,
but does not occupy a Vacation Unit, may go in order to have
limited access to simply visit the Project; and (iii) each
Facilities/Amenities Condominium Owner may go in order to access
the particular Facilities/Amenities Unit owned by such Owner, and
to access, conduct business in, use for their respective intended
purposes, and/or visit, the other Facilities/Amenities Units.
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(August 31, 1998)
1.22 "Association Personal Property" means all property owned,
leased or otherwise held for use by the Association, whether upon
or outside of the Land, which is not Association Real Property,
other than Common Furnishings.
1.23 "Association Property" means all Association Real
Property and all Association Personal Property.
1.24 "Association Real Property" means that portion of the
Real Property which has been deeded by Declarant to the
Association.
1.25 "Association Restricted Use Real Property" means that
certain Association Real Property, delineated as such on the
Condominium Plan, which is not Association General Use Real
Property.
1.26 "Association Rules and Regulations" means the Rules and
Regulations adopted, promulgated, and modified from time to time by
the Board pursuant to Section 5.02 d. of this Declaration relating
to the use and/or occupancy by Vacation Ownership Owners and
Permitted Users of the Vacation Units and the Common Furnishings,
and/or the operation of the Vacation Ownership Operation, and the
use by all Condominium Interest Owners and Permitted Users of the
Association General Use Property.
1.27 "Basic Expenses" means either the estimated aggregate
amount of costs and expenses, as set forth in the Budget, to be
incurred by the Association in connection with its day-to-day
administration and management of the Project, the Association
Personal Property, and the Vacation Ownership Operation projected
for a particular forthcoming Fiscal Year, or the actual aggregate
amount of such costs and expenses incurred by such Association as
a result of such activities during a particular Fiscal Year,
including, without limitation, the costs and expenses required: (i)
to maintain, repair, keep clean, repaint, refinish, redecorate,
restore, and/or replace, as may be applicable, all Association Real
Property, all Association Personal Property, Common Area, and
Common Furnishings; (ii) to provide for adequate reserves which
will insure that funds are on hand to pay the cost of needed
repairs to, and restoration and replacement of, such Association
Real Property, Association Personal Property, Common Area, and
Common Furnishings; (iii) to administer and operate the Vacation
Ownership Use Program; (iv) to pay any exchange company membership
fee, (v) to pay the fee(s) charged by Declarant as consideration
for Declarant's authorizing the Condominium Interest Owners to park
their vehicles in the Garage and Ramps Unit; (vi) to obtain and pay
the costs of all utility services to the Vacation Units, the
Facilities/Amenities Units and/or to the Association Real Property,
to the extent that such costs are not separately billed to the
Facilities/Amenities Condominiums Owner(s) or to the Vacation
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(August 31, 1998) 7
Ownership Owners, as the case may be; (vii) to pay, as agent of the
Condominium Interest Owners, and not as principal, any and all
taxes and assessments (real and personal) assessed against,
affecting, and/or relating to a Vacation Condominium Vacation
Ownership, Facilities/Amenities Condominium, Association Real
Property, Association Personal Property, Common Furnishings, and/or
any interest therein, to the extent that such taxes are not
separately assessed to the Vacation Ownership Owners, or the
Facilities/Amenities Condominiums Owner(s), as the case may be;
(viii) to pay for any and all assessments and/or other similar
governmental charges levied on or attributable to occupancy of the
Vacation Units, including, without limitation, any hotel or bed tax
or any governmental charge levied in lieu of such hotel or bed tax;
(x) to pay for any insurance required by this Declaration or
otherwise purchased by the Association; (xi) to compensate for any
unpaid Assessment, including the costs of billing and collection,
levied by the Association during the previous Fiscal Year against
any Condominium Interest Owner who has defaulted in the payment
thereof, to the extent that the same is determined by the Board to
be uncollectible; (xii) for wages, accounting and legal fees,
cleaning fees, repair charges, and other expenses related to
administering, managing, and operating the Project, Association
Personal Property, and the Vacation Ownership Operation; (xiii) to
account for the possibility that some Assessments may not be paid
on a current basis; (xiv) to provide for the payment of the fee due
the Managing Agent; and (xv) to provide for any other services to
the Condominium Interest Owners and/or do any other acts not incon-
sistent with this Declaration in connection with the administra-
tion, management, and operation of the Project, Association
Personal Property, and the Vacation Ownership Operation.
1.28 "Biennial Fixed Week/Floating Unit Vacation Ownership"
means a "time-share estate" as defined California Business and
Professions Code Section 11003.5, being here comprised basically
of: One: an undivided one-half (1/2) fee title interest as a
tenant-in-common in an undivided I/51th fee title interest in a
Vacation Condominium; Two; subject to the terms and conditions of
this Declaration and the Rules and Regulations, the exclusive right
to use and occupy an Ocean View Vacation Unit or a Park View
Vacation Unit of a particular Vacation Unit Type, and the Common
Furnishings in such Vacation Unit, together with: (i) the
nonexclusive right to access, use for their respective intended
purposes, and/or visit, the Lobby and Front Desk Unit (excluding
the marketing desk in lobby), the Office Behind Front Desk Unit,
the Gym Unit, and the Adult Pool, Spa and Pool Deck Unit (called
the "Accessible Facilities/Amenities Units"), each as delineated on
the Condominium Plan, together with (ii) the nonexclusive right to
go to, from, over, upon, under, across and through (as may be
applicable) the Association General Use Real Property, as such is
delineated on the Condominium Plan, in order to in order to have
ingress and egress to and from the foregoing Vacation Unit and each
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(August 31, 1998) 8
such Accessible Facilities/Amenities Unit, all for a Fixed Week in
each Even Use Year or Odd Use Year (as may be the case) ; with
Declarant's reserving, however, from One and Two above, for
Declarant, certain easements and other rights; and Three:
Membership for each Vacation Ownership Owner thereof in the
Association.
1.29 "Biennial Floating Week/Floating Unit Vacation Ownership"
means a "time-share estate" as defined in California Business and
Professions Code Section 11003.5, being here comprised basically
of: One: an undivided one-half (1/2) fee title interest as a
tenant-in-common in an undivided l/51th fee title interest in a
Vacation Condominium; Two; subject to the terms and conditions of
this Declaration and the Rules and Regulations, the exclusive right
to use and occupy an Ocean View Vacation Unit or a Park View
Vacation Unit of a particular Vacation Unit Type, and the Common
Furnishings in such Vacation Unit, together with: (i) the
nonexclusive right to access, use for their respective intended
purposes, and/or visit, the Lobby and Front Desk Unit (excluding
the marketing desk in lobby), the Office Behind Front Desk Unit,
the Gym Unit, and the Adult Pool, Spa and Pool Deck Unit (called
the "Assessable Facilities/Amenities Units"), each as delineated on
the Condominium Plan, together with (ii) the nonexclusive right to
go to, from, over, upon, under, across and through (as may be
applicable) the Association General Use Real Property, as such is
delineated on the Condominium Plan, in order to in order to have
ingress and egress to and from the foregoing Vacation Unit and each
such Accessible Facilities/Amenities Unit, all for a Use Week,
during either High Season or Prime Summer Season (as may be the
case) in each Even Use Year or Odd Use Year (as may be the case),
upon the condition that, before the occurrence of any such use
and/or occupancy, such Vacation Unit and Use Week shall have first
been reserved by the Vacation Ownership Owner in accordance with
the applicable provisions of this Declaration and the Association
Rules and Regulations; with Declarant's reserving, however, from
One and Two above, for Declarant, certain easements and other
rights; and Three: membership for each Vacation Ownership Owner
thereof in the Association.
1.30 "Biennial Owner" for "Biennial Vacation Ownership Owner")
means the Vacation Ownership Owner of either a Biennial Fixed
Week/Floating Unit Vacation Ownership, or a Biennial Floating
Week/Floating Unit Vacation Ownership.
1.31 "Biennial Ownership" for "Biennial Vacation Ownership")
means either a Biennial Fixed Week/Floating Unit Vacation
Ownership, or a Biennial Floating Week/Floating Unit Vacation
Ownership.
1.32 "Biennial Vacation Ownership" means the same as
"Biennial Ownership as defined in Section 1.31.
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(August 31. 1998) 9
1.33 "Biennial Vacation Ownership Owner" means the same as
"Biennial Owner" as defined in Section 1.30.
1.34 "Board" means the Board of Directors of the Association.
1.35 "Bonus Time/Rental Use" means each Use Week or portion
thereof during which a particular Designated Vacation Unit is
available for rental to Owners or members of the public by and for
the benefit of the Association by virtue of the fact that: (i) an
Owner has checked-out of such Owner's Assigned Unit before the
scheduled Check-out Time, or checked-in to such Unit later than the
scheduled Checked-in Time; (ii) the Owner who was otherwise
entitled to occupy such Unit for such Use Week or portion thereof
has had his, her, or its rights and privileges to use and occupy
such Unit suspended by the Association in accordance with Section
7.02 below because of failure to pay to the Association, when due,
any Assessments or other charges levied by the Association or
because of being in other violation of the provisions of this
Declaration and/or the Rules and Regulations, and has failed to pay
such past due Assessment or cure such other violation by not later
than (a) 14 days prior to the applicable Check-in Time for such
occupancy, or (b) 20 days prior to the applicable Check-in Time for
such contemplated occupancy, where the Owner whose rights and
privileges had been suspended due to such Owner's failure to pay
any Assessments when due, has had such rights and privileges
suspended for a period of two (2) years or more; (iii) the Use Week
or portion thereof fell within a scheduled Maintenance Week for
such Unit, and the Managing Agent has determined that repairs and
maintenance are not required to be made to the Common Furnishings
in said Unit during such Period; or (iv) the Use Week or portion
thereof had occurred during the 53rd Use Week of a Use Year having
53 Use Weeks therein, the Association being deemed to be the Owner
of all Vacation Ownerships which have Fixed Week occurring in the
53rd Use Week of Use Years having 53 Use Weeks.
1.36 "Budget" means the written estimate of the revenue which
the Board believes will be received, and Basic Expenses which the
Board believes will be incurred, by the Association in connection
with its administering and managing the Project, the Association
Personal Property, and the Vacation Ownership Operation for each
forthcoming Fiscal Year, which Budget the Managing Agent must
prepare, and the Board must approve, prior to the commencement of
each new Fiscal Year pursuant to Section 5.02 n. below.
1.37 "Bylaws" means the bylaws of the Association, as same may
be amended from time to time.
1.38 "Calendar" means each Calendar of Use Weeks established
for each consecutive Use Year. The Calendars for Use Years ,
and are attached hereto as Exhibit "A" and made a part
hereof.
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(August 31, 1998) 10
1.39 "Check-in Day" means either Friday, Saturday or Sunday,
as specified in a Vacation Ownership Owner's Original Deed.
1.40 "Check-in Time" and "Check-out Time" means the scheduled
times for Vacation Ownership Owners' arrival at and departure from
their Assigned Vacation Units as set forth in the then current
Rules and Regulations.
1.41 "Common Area" means all of the airspace area (other than
the Vacation Units and the Facilities/Amenities Units) delineated
as such on the Condominium Plan.
1.42 "Common Furnishings" means: (i) all movable furniture,
furnishings, appliances, fixtures, equipment, and all other
personal property from time to time owned, leased, or otherwise
held for use, by the Association located, or to be located, within
the Vacation Units; (ii) the interior surfaces (such as wallpaper,
paint, carpets, and other flooring material) of the perimeter
walls, floors, and ceilings bounding the interiors of each Vacation
Unit; and (iii) all nonbearing walls and doors (and the surfaces
thereof) which are within the perimeter walls of each Vacation
Unit.
1.43 "Condominium" means, generally, pursuant to California
Civil Code Section 783, an estate in real property as described in
Civil Code Section 1351(f), and means here, specifically, either a
Vacation Condominium or a Facilities/Amenities Condominium.
1.44 "Condominium Interest" means either a Vacation Ownership
in a Vacation Condominium or ownership of a Facilities/Amenities
Condominium.
1.45 "Condominium Interest Owner" means an owner or owners in
fee title of a Vacation Ownership or an owner or owners in fee
title of a Facilities/Amenities Condominium.
1.46 "Condominium Ownership Operation" means the Proj ect, the
Association Personal Property, and the Vacation Ownership
Operation, as being administered, managed, and operated by the
Association, and the Facilities/Amenities Condominiums Operation,
as being administered, managed, and operated by the Declarant.
1.47 "Condominium Plan" means that certain Condominium Plan
for Vacation and Facilities/Amenities Condominiums in Grand Pacific
Palisades Resort recorded , 1998, as
Document No. 1998- , of Official Records of the San
Diego County Recorder's office, San Diego, California, and any and
all amendments which may be made thereto.
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(August 31, 1998) 11
1.48 "Condominium Unit" means either a Vacation Unit or a
Facilities/Amenities Unit delineated as such on the Condominium
Plan.
The boundaries of any particular Condominium Unit are the
interior surfaces of the perimeter walls, floors, ceilings,
windows, and doors of that portion of the structure (part of the
Improvements) enclosing such Unit; and each such Unit includes both
the portion of the structure as above described and the airspace so
encompassed. The following are not a part of any Condominium Unit:
any and all bearing walls, columns, floors, roofs, foundations,
elevator equipment and shafts, central heating, central
refrigeration and central air conditioning equipment, reservoirs,
tanks, pumps and other central services, pipes, ducts, flues,
chutes, conduits, wires and other utility installations, wherever
located, except the outlets thereof when located within such a
Unit. In interpreting deeds and plans, the existing physical
boundaries of each Condominium Unit or of such a Unit reconstructed
in substantial accordance with the original plans therefore shall
be conclusively presumed to be its boundaries rather than any metes
and bounds expressed in the deed or plan, regardless of settling or
lateral movement of the structures enclosing such Unit and
regardless of minor variances between boundaries shown on the plans
or in a deed and those of any such structures.
1.49 "Declarant" means GRAND PACIFIC PALISADES LLC, a Califor-
nia limited liability company, and/or any assigns or other
successors in interest to GRAND PACIFIC PALISADES LLC, as developer
of the Project and/or as Owner of all or substantially all
Declarant Vacation Ownerships.
1.50 "Declaration" means that particular Declaration of
Covenants, Conditions and Restrictions for Condominium Interests in
Grand Pacific Palisades Resort recorded , 1998, as
Document No. 1998- , of Official Records of the San
Diego County Recorder's Office, San Diego, California, and any and
all amendments which may be made thereto.
1.51 "Declarant Annual Vacation Ownership" means each Annual
Vacation Ownership owned by Declarant.
1.52 "Declarant Biennial Vacation Ownership" means each
Biennial Vacation Ownership owned by Declarant.
1.53 "Declaration Condominium Interest" means each Condominium
Interest owned by Declarant.
1.54 "Declarant Vacation Ownership" means each Declarant
Annual Vacation Ownership and each Declarant Biennial Vacation
Ownership. Declarant shall be deemed to own Vacation Ownerships in
each Nondesignated Vacation Unit as well as (Declarant's unsold
gral1 -03\docs\ccrs.01
(August 31, 1998) 12
Vacation Ownerships) in Designated Vacation Units. At any point in
time, the number of Declarant Ownerships shall be the difference
between 8,211 (the total number of Vacation Ownerships in the
Vacation Condominiums intended to be created by Declarant) and the
total number of Vacation Ownerships conveyed by Declarant to third
parties by Original Deeds (and not thereafter reacquired in any
manner by Declarant). In this connection, for voting, Assessment
and certain other purposes under this Declaration, each Annual
Ownership shall be treated as being one (1) Ownership and each
Biennial Ownership being one-half (1/2) of an Ownership.
Therefore, if, for illustration purposes, the total number of
Biennial Ownerships ultimately created in the Project is 4,000,
they shall, for these purposes, constitute an aggregate of 2,000
Ownerships out of the total 8,211 Ownerships in the Project.
1.55 "Designated Vacation Unit" means any of those particular
Vacation Units, which Declarant, pursuant to the terms of Article
14 of this Declaration, has from time to time designated and made
subject to the Use Program, and, in which, Declarant may offer for
sale and/or sell Vacation Ownerships under the authority given it
by the California Department of Real Estate.
1.56 "Development" means the Declarant's contemplated
development and construction of Improvements upon the Land, in
three (3) Phases, into the Grand Pacific Palisades Resort described
in Recital Paragraph B above.
1.57 "Distributable Net Proceeds" means the respective shares
of any net proceeds which the Association receives under
extraordinary circumstances such as from, but not limited to, the
sale of the Project, the Association Personal Property, and the
Common Furnishings, which are to be paid, respectively, to the
Vacation Ownership Owners, and to the Owner(s) of the Facilities/
Amenities Condominiums, pursuant to Section 2.08.
1.58 "Even Use Year" means, with respect to the Vacation
Ownership Use Program, each Use Year which falls in an even-
numbered calendar year.
1.59 "Exchange Program" means a service provided by an
independent organization whereby Vacation Ownership Owners may
exchange their respective Use Weeks in a Vacation Condominium for
occupancy rights in other projects that have time-sharing programs.
1.60 "Exchange User" means, with respect to the Vacation
Ownership Use Program, an owner of an occupancy right in another
project that has a timesharing program who occupies an Assigned
Unit in the Project during a Use Week pursuant to an Exchange
Program.
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(August 31, 1998) 13
1.61 I'Facilities/Amenities Condominium" means one of the 14
Condominiums in the Project designed by the Declarant for use as a
facility and/or amenity within the Project. These 14 Condominiums
are: (i) the Gift Shop Condominium, (ii) the Activities Desk
Condominium, (iii) the Lobby and Front Desk Condominium, (iv) the
Office Behind Front Desk Condominium, (v) the Gifting/Bell Closet
Condominium, (vi) the Owner Relations Office Condominium, (vii) the
Meeting Room Condominium, (viii) the Recreation Room Condominium,
(ix) the Game Room Condominium, (x) the Office Condominium, (xi)
the Gym Condominium, (xii) the Clubhouse Condominium, (xii) the
Adult Pool, Spa and Pool Deck Condominium, and (xiv) the Garage and
Ramps Condominium.
Each such Facilities/Amenities Condominium is comprised
basically of the following: One; an undivided l/175th fee title
interest in the Common Area delineated as such on the Condominium
Plan; Two; the applicable Facilities/Amenities Unit delineated as
such on said Condominium Plan; Three; (i) the nonexclusive right to
access, conduct business in, use for their respective intended
purposes, and/or visit, each other Facilities/Amenities Unit as
delineated on the Condominium Plan, together with (ii) the
nonexclusive right to go to, from, over, upon, under, across and
through (as may be applicable) the Association General Use Real
Property, as such is delineated on the Condominium Plan, in order
to have ingress and egress to and from each Facilities/Amenities
Unit; and Four: membership for its owner in the Association; with
Declarant's reserving, however, from One, and Two above, certain
easements and other rights.
The Declarant shall retain ownership of the Facilities/
Amenities Condominiums, but shall grant certain nonexclusive use
rights relating to only the Accessible Facilities/Amenities Units
in favor of the Vacation Ownership Owners and in favor of the
Owner(s) and users of the Grand Pacific Palisades Hotel Project
adjoining the Land.
1.62 "Facilities/Amenities Condominium Owner" means the owner
of a Facilities/Amenities Condominium in the Project.
1.63 "Facilities/Amenities Condominium Owner's Personal Prop-
erty" means: (i) all movable furniture, furnishings, appliances,
fixtures, trade fixtures, equipment, and all other personal prop-
erty from time to time owned, leased, or otherwise held for use, by
a Facilities/Amenities Condominium Owner located, or to be located,
within the particular Facilities/Amenities Unit or Units belonging
to such Owner; (ii) the interior surfaces (such as wallpaper,
paint, carpets, and other flooring material) of the perimeter
walls, floors, and ceilings bounding the interiors of each such
Facilities/Amenities Unit; and (iii) all nonbearing walls and doors
(and the surfaces thereof) which are within the perimeter walls of
each such Facilities/Amenities Unit.
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(August 31, 1998) 14
1.64 "Facilities/Amenities Condominiums Operation" means the
operation of the 14 Facilities/Amenities Condominiums, as being
administered, managed, and operated by the Owner(s) of these
Condominiums.
1.65 "Facilities/Amenities Condominiums Owner(s) Rules and
Regulations" means any Rules and Regulations adopted, promulgated,
and modified from time to time by the Owner(s) of the Facilities/
Amenities Condominiums with respect to the use by all Condominium
Interest Owners and Permitted Users of the Facilities/Amenities
Units.
1.66 "Facilities/Amenities Unit" means any one of the 14
Facilities/Amenities Condominium Units delineated as such on the
Condominium Plan. A Facilities/Amenities Unit Designation Symbol
has been assigned to each of these Facilities/Amenities Units, as
follows:
Fac ilities/Amenities
Unit
Gift Shop Unit
Activities Desk Unit
Lobby and Front Desk
Unit
Office Behind Front
Desk Unit
Gifting/Bell Closet
Unit
Owner Relations Office
Unit
Meeting Room Unit
Recreation Room Unit
Game Room Unit
Office Unit
Gym Unit
Clubhouse Unit
Adult Pool, Spa and
Facilities/Amenities
Condominium
Designation Symbol
A-l
A-2
A-3
A-4
A-5
A-6
A-7
A-8
A-9
A-10
A-ll
A-12
A-13
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(August 31, 1998)15
Pool Deck Unit
Garage and Ramps Unit A-14
1.67 "Facilities/Amenities Unit Designation Symbol" means the
capital letter "A" followed by the particular number assigned to
each Facilities/Amenities Unit on the Condominium Plan and in this
Declaration.
1.68 "Fiscal Year" means the one (l)-year period commencing on
January 1st of each year and ending on December 31st of that year,
which shall be the fiscal year for the operation of the
Association, which may be subsequently changed by the Board.
1.69 "Fixed Week" means, as to an Owner of an Annual Fixed
Week/Floating Unit Vacation Ownership, that particular Use Week
during each Use Year, and as to each Owner of a Biennial Fixed
Week/Floating Unit Vacation Ownership, that particular Use Week
during either each Even Use Year or each Odd Use Year (as may be
the case) as has been granted to such Owner by his, her, or its
Original Deed (or subsequent deed, if a successor Owner), during
which Use Week such Owner (or such Owner's Permitted User) has the
exclusive right to use and occupy an Assigned Unit and the Common
Furnishings therein, together with the nonexclusive right to use
the Association General Use Real Property for the purposes provided
in such deed.
1.70 "Floating Unit" means a Vacation Unit, the exclusive
occupancy and use of which is to be assigned by the Association to
an Owner for a Use Week (upon a "first-reserved, first-served
basis").
1.71 "Floating Week" means a Use Week for use and occupancy of
a Vacation Unit which is to be assigned by the Association to an
Owner of either an Annual or Biennial Floating Week/Floating Unit
Vacation Ownership (upon "first-reserved, first-served basis").
1.72 "High Season" means as to an Annual Floating Week/
Floating Unit Vacation Ownership or a Biennial Floating Week/
Floating Unit Vacation Ownership, Use Weeks 1 through 25, and 36
through 52.
1.73 "Hotel Ownerfs) Use Rights Declaration^ means that
certain Declaration of Covenants, Conditions, and Restrictions
Relating to Hotel Owner(s) Use Rights recorded ,
1998, as Document No. 1998- , of Official Records of the
San Diego County Recorder's Office, San Diego, California, and any
and all amendments which may be made thereto.
1.74 " Improvements" means all or any of the buildings,
structures, facilities, appurtenance, landscaping and any and all
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(August 31, 1998) 16
other improvements which legally constitute real property,
constructed or to be constructed in and upon the Land.
1.75 "Land" means that certain real property legally described
in Recital Paragraph A above.
1.76 "Maintenance Week" means, with respect to any particular
Vacation Unit, a total of seven (7) Nights in each Use Year
reserved by the Association as the period of time during which
needed repairs, maintenance, and replacements to the Common
Furnishings therein, and/or to the Association Real Property
encompassing such Unit, shall be made by the Association.
1.77 "Managing Agent" means the agent engaged by the Board
pursuant to and in the manner provided in Section 5.03 of this
Declaration.
1.78 "Member" means a member of the Association.
1.79 Membership" means the right of participation which each
Member holds in the Association, by virtue of his, her or its being
a Condominium Interest Owner.
1.80 "Module" means the same as "Phase" as defined in Section
1.100.
1.81 "Module I" means the same as "Phase I" as defined in
Section 1.101.
1.82 "Module II" means the same as "Phase II" as defined in
Section 1.102.
1.83 "Module III" means the same as "Phase III" as defined in
Section 1.103.
1.84 "Mortgage" means a deed of trust or mortgage encumbering
any Condominium Interest.
1.85 "Mortgagee" means the beneficiary of a recorded deed of
trust or the holder of a recorded mortgage encumbering any
Condominium Interest.
1.86 "Night" means each successive 24-hour period commencing
from Check-in Time during any Use Week, except that the last Night
during any Use Week, or portion thereof, shall include only that
number of hours from the end of the last 24-hour period to Check-
out Time on the following day.
1.87 "Nondesignated Vacation Units" means those particular
Vacation Units, if any, which Declarant has not, pursuant to the
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(August 3T, 1998) 17
terms of Article 14 of this Declaration, designated and made
subject to the Use Program.
1.88 "Ocean View Unit" means same as "Ocean View Vacation
Unit" as defined in Section 1.89.
1.89 "Ocean View Vacation Unit" (or "Ocean View Unit") means
one of Vacation Units 137-154, 237-254, and 337-354, as delineated
on the Condominium Plan, and as provided in an Original Deed to an
original Vacation Ownership Owner, or in a subsequent deed to a
successor Owner.
1.90 "Odd Use Year" means each Use Year which falls in an odd-
numbered calendar year.
1.91 "Original Deed" means each grant deed from Declarant
recorded after the date hereof which conveys a Vacation Ownership
to a member(s) of the general public for use by such member(s) for
vacation/restaurant purposes, excluding, however, any deed which
conveys all or substantially all Declarant Ownerships and which
deed expressly recites that it is not an Original Deed within the
meaning of this Declaration.
1.92 "Owner" means either a "Vacation Ownership Owner" as
defined in Section 1.124 or a "Facilities/Amenities Condominium
Owner" as defined in Section 1.62, depending upon the context.
Ii93 "Ownership" means the same as a "Vacation Ownership" as
defined in Section 1.124 below.
1.94 "Park View Unit" means the same as "Park View Vacation
Unit" as defined in Section 1.95.
1.95 "Park View Vacation Unit" Cor "Park View Unit") means one
of Vacation Units 170-179, 182, 270-279, 282, and 370-382, as
delineated on the Condominium Plan, and as provided in an Original
Deed to an original Vacation Ownership Owner, or in a subsequent
deed to a successor owner, which Unit will generally have a view
eastward.
1.96 "Permitted User" means as the context dictates, either:
(i) as to any Vacation Condominium, any person, other than an
Exchange User, who occupies and/or visits an Assigned Vacation
Unit, along with, or independently of, an Owner, but in all cases
by the express authority of the Owner(s) of the Vacation Ownership
entitled to such occupancy, or by the Association as to any Bonus
Time/Rental Use, including, but not limited to, an Owner's family
members (where children alone on the Project, must be above a
specified age), guests, lessees, tenants, renters, agents,
employees, business visitors, and/or other invitees, all as may be
gra11-03\docs\ccrs.01
(August 31, 1998) 18
clarified and further restricted by the Association Rules and
Regulations; and (ii) as to any Facilities/Amenities Condominium,
any person who possesses, leases, uses, occupies, and/or otherwise
visits, a Facilities/Amenities Unit, along with, or independently
of, the Owner of such Unit, but in all cases with the express
authority of the Owner(s) of such Unit, including, but not limited
to, an Owner's family members, guests, lessees, tenants, renters,
licensees, operators, agents, employees, patrons, business
visitors, and/or other invitees, all as may be clarified and
further limited by the Facilities/Amenities Condominium Owner(s)
Rules and Regulations.
1.97 "Phase" for "Module") means any of the three (3)
contemplated construction stages of the Project: Phase I, Phase II,
or Phase III. The respective location upon the Land of each such
Phase is as delineated on the Condominium Plan.
1.98 1'Phase I" (or "Module I'M means the initial construction
upon the Land of 71 Vacation Condominiums and 14 Facilities/
Amenities Condominiums.
1.99 "Phase II" for "Module II") means the contemplated or
actual construction of 72 Vacation Condominiums upon the Land
following the construction of Phase I.
1.100 "Phase III" (or "Module III") means the contemplated or
actual construction of the final 18 Vacation Condominiums upon the
Land following the construction of Phase II.
1.101 "Phase I Property" means that portion of the Land to be
developed in Phase I.
1.102 "Phase II Property" for "Annexable Property #1") means
that portion of the Land to be developed in Phase II.
1.103 "Phase III Property" for "Annexable Property #2") means
that portion of the Land to be developed in Phase III.
1.104 "Prime Summer Season" means, as to an Annual Floating
Week/Floating Unit Vacation Ownership or a Biennial Floating Week/
Floating Unit Vacation Ownership, Use Weeks 26 through 35.
1.105 "Project" means all Real Property which the Declarant
has deeded to the Association, that is, the Association Real
Property, and that portion of the Common Area within each Phase for
which the Land therein has been annexed to the existing Project.
The Project excludes: (i) Real Property not yet deeded by the
Declarant to the Association; (ii) Association Personal Property,
and (iii) Common Furnishings. The Project is known as the Grand
Pacific Palisades Resort. The Project, together with the
gra11-03\docs\ccrs.01
(August 31, 1998) 19
Association Personal Property, shall be administered, managed, and
operated by the Association.
1.106 "Project Basic Expenses" means those portions of the
Association Basic Expenses, and their corresponding Assessments,
determined by the Association to be attributable to, and payable
by, both Vacation Ownership Owners and the Owner(s) of one or more
Facilities/Amenities Condominiums.
1.107 "Project Diagram" means the PROJECT DIAGRAM FOR THE
GRAND PACIFIC PALISADES RESORT identifying thereon the approximate
location and number designation of each Vacation Unit and each
Facilities/Amenities Unit, and the approximate location and
designation of the buildings and other Improvements to be
developed, or as developed, upon the Property, A copy of this
Project Diagram, which is comprised of ( ) pages, is
attached hereto as Exhibit "B" and made a part hereof. This
Project Diagram is not a survey, nor is it based upon a survey, of
the Land; and it contains only approximations of the locations,
sizes, and configurations of the Vacation Units and Improvements
upon or to be developed upon the Land.
1.108 "Project Special Expenses" means those portions of the
Association Special Expenses, and their corresponding Assessments,
determined by the Association to be attributable to, and payable
by, both Vacation Ownership Owners and the Owner (s) of one or more
Facilities/Amenities Condominiums.
1.109 "Pro Rata Share" means each respective, fair and
equitable percentage (as determined by the Association) of any
Project Basic Expenses or Project Special Expenses, and of their
corresponding Assessments, determined by the Association to be
attributable to, and payable by, either the Vacation Ownership
Owners or the Owner (s) of one or more Facilities/Amenities
Condominiums, as the case may be.
1.110 "Purchase Agreement" means a Purchase and Sale Agreement
and Escrow Instructions between Declarant and the person, persons,
or other entity named therein as buyer providing for the sale by
Declarant and the purchase by said buyer of one or more Vacation
Ownerships, to be conveyed by an Original Deed.
1.111 "Real Property" means all or any of the Land and
Improvements thereon.
1.112 "Rules and Regulations" means, collectively, both the
"Association Rules and Regulations" as defined in Section 1.26, and
the "Facilities/Amenities Condominium Owner(s) Rules and
Regulations" as defined in Section 1.65.
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(August 31, 1998) 20
1.113 "Special Expenses" means those extraordinary expenses,
including capital expenditures, of the Association which are not
Basic Expenses and which are expenses for which Special Assessments
and/or Capital Needs Assessments are levied pursuant to Article 6
of this Declaration.
1.114 "Sole Basic Expenses" means those portions, if any, of
the Association Basic Expenses, and their corresponding Assess-
ments, determined by the Association to be attributable to, and
payable by, only Vacation Ownership Owners, or, by only the
Owner(s) of one or more of the Facilities/Amenities Condominiums,
as the case may be.
1.115 "Sole Special Expenses" means those portions, if any, of
the Association Special Expenses, and their corresponding Assess-
ments, determined by the Association to be attributable to, and
payable by, only Vacation Ownership Owners, or, by only the
Owner(s) of one or more of the Facilities/Amenities Condominiums,
as the case may be.
1.116 "Unit" means, as the context dictates, either a "Vaca-
tion Unit" as defined in Section 1.126, or a "Facilities/Amenities
Unit" as defined in Section 1.66.
1.117 "Unit Type" means the same as "Vacation Unit Type" as
defined in Section. 1.128.
1.118 "Use Program" means the same as "Vacation Ownership Use
Program" as defined in Section 1.135.
1.119 "Use Week" means each of the 52 (or in some instances
53) consecutively numbered seven (7) consecutive-Night periods of
time listed on each Calendar for any particular Use Year, and
includes either a Fixed Week or a Floating Week. Notwithstanding
the fact that each Use Week on each Calendar is shown as being
comprised of seven (7) consecutive Nights, the Board may, but is
under no obligation to, adopt provisions in the Vacation Ownership
Rules and Regulations which would allow Vacation Ownership Owners
to occupy a Vacation Unit for periods of time which are less than
seven (7) consecutive Nights (sometimes called "Split-Use Weeks"),
so long as the total, accumulated time of such periods of occupancy
does not exceed seven Nights, and so long as the seven (7) Nights
occupied do not include more than two (2) Weekend Nights.
1.120 "Use Year" means the particular 52-Use Weeks (or 53rd-
Use Week in each year in which there occurs 53-Use Weeks) length of
time set forth on each Calendar.
1.121 "Vacation Condominium" means any of the presently
contemplated 161 Condominiums in the Project designed by Declarant
for vacation use and occupancy. Each such Vacation Condominium is
gral1-03\docs\ccrs.01
(August 31, 1998) 21
comprised basically of the following: One: an undivided l/175th fee
title interest in the Common Area delineated as such on the
Condominium Plan; and Two; a particular Ocean View Vacation Unit or
Park View Vacation Unit as delineated on the Condominium Plan,
excepting the right to use and occupy such Vacation Unit, except as
any such right to use and occupy such Vacation Unit, or an
Accessible Facilities/ Amenities Unit, is granted by deed to a
Vacation Ownership Owner; with Declarant's reserving, however, from
One and Two, above, certain easements and other rights.
1.122 "Vacation Ownership" for "Ownership") means, generally,
a time-share estate as defined in California Business and
Professions Code § 11003.5, which is an interest in real property,
and here specifically, either: (i) an Annual Fixed Week/Floating
Unit Vacation Ownership, (ii) an Annual Floating Week/Floating Unit
Vacation Ownership, (iii) a Biennial Fixed Week/Floating Unit
Vacation Ownership, or (iv) a Biennial Floating Week/Floating Unit
Vacation Ownership. The total number of Vacation Ownerships in the
Vacation Condominiums intended to be created by Declarant is 8,211
regardless of the respective numbers of Annual Ownerships and
Biennial Ownerships conveyed in the Project. In this connection,
for voting, Assessment, and certain other purposes under this
Declaration, each Annual Ownership shall be treated as being one
(1) Ownership, and each Biennial Ownership shall be treated as
being one-half (1/2) of an Ownership. Therefore, if, for
illustration purposes, the total number of Biennial Ownerships
ultimately created in the Project is 4,000, they shall, for these
purposes, constitute an aggregate of 2000 Ownerships out of the
total 8,211 Ownerships in the Project.
1.123 "Vacation Ownership Operation" means the Vacation Units,
the Common Furnishings therein, and the Vacation Ownership Use
Program, as being administered, managed, and operated by the
Association as a time-share project.
1.124 "Vacation Ownership Owner" (or "Owner") means the owner
or owners in fee title of a Vacation Ownership by virtue of his,
her, its or their : (i) being the grantee or, collectively, the
grantees named in the Original Deed conveying any Vacation Owner-
ship; (ii) a successor or successors in interest to each grantee or
grantees described in (i) above; and (iii) the Declarant Vacation,
with respect to each Declarant Ownership.
1.125 "Vacation Ownership Use Program" (or "Use Program")
means the overall policy, system, and operation established by this
Declaration, and the Association Rules and Regulations made
pursuant thereto, which enable an Owner to exclusively use, occupy,
and enjoy an Assigned Vacation Unit and the Common Furnishings
therein and to non-exclusively use the Association General Use Real
Property, for a Use Week, including, but not by way of limitation,
the procedures for cancellation of reservations, splitting of Use
1 -03\docs\ccrs. 01
(August 31, 1998) 22
Weeks, checking-in and checking-out of Units, and the exchange of
occupancy rights between Vacation Ownership Owners or by Vacation
Ownership Owners under an Exchange Program.
1.126 "Vacation Unit" means any one of the Vacation Units
delineated as such on the Condominium Plan. A Vacation Unit
Designation Symbol has been assigned to each of these Vacation
Units. There are two (2) categories of Vacation Units: Ocean View
Vacation Units as defined in Section 1.89 and Park View Vacation
Units as defined in Section 1.95.
1.127 "Vacation Unit Designation Symbol" means the capital
letter "V" followed by the particular number assigned to each
Vacation Unit on the Condominium Plan.
j
1.128 "Vacation Unit Type" for "Unit Type") means one of the
four (4) different categories of Vacation Units in a Vacation
Condominium, based upon a particular Unit's number of bedrooms and
bathrooms, square footage, and configuration described and
identified on the Project Diagram as either an "A" Unit Type (being
2-bedroom/2-bath), "B" Unit Type (being 1-bedroom/l-bath, "C" Unit
Type (also being 1-bedroom/l-bath), or "E" Unit Type (being 3-
bedroom/2-bath).
1.129 "Week Day" means any period of time beginning at Check-
in Time on a Sunday, Monday, Tuesday, Wednesday, or Thursday and
ending at Check-in Time on the next calendar day immediately
following.
1.130 "Weekend" means any period of time beginning at Check-in
Time on a Friday or Saturday and ending at Check-out Time on the
next calendar day immediately following.
ARTICLE 2
VARIOUS RIGHTS, OBLIGATIONS, AND RESTRICTIONS RELATED
TO OWNERSHIP, USE AND POSSESSION, MAINTENANCE, TAXES.
EXPENSES. MORTGAGING. AMD LEASING AMD RENTING
2.01 Right of Vacation Ownership Owners to Use Vacation Units.
Related Rights and Duties, and Prohibitions.
a. Exclusive Right to Use a Vacation Unit and Common
Furnishings Therein. Each Vacation Ownership Owner has been
granted in the deed to such Owner's Vacation Ownership the
exclusive right to use, possess, and enjoy a Vacation Unit and the
Common Furnishings therein in accordance with and subject to the
terms of: (1) such deed, (ii) this Declaration, (iii) the Rules and
Regulations, and (iv) the Hotel Owners Use Rights Declaration.
gra11-03\docs\ccrs.01
(August 31, 1998) 23
b. Types of Vacation Ownerships. Vacation Ownership
Owners own one or more of the following types of Vacation
Ownerships in the Project:
1. Annual Fixed Week/Floating Unit Vacation
Ownership (as defined in Section 1.06);
2. Annual Floating Week/Floating Unit Vacation
Ownership (as defined in Section 1.07);
3. Biennial Fixed Week/Floating Unit Vacation
Ownership (as defined in Section 1.22);
4. Biennial Floating Week/Floating Unit Vacation
Ownership (as defined in Section 1.23).
In the instance of categories l. and 3. above (Fixed Week/
Floating Unit Vacation Ownerships) , while an Owner has been granted
(in the Original Deed) a particular Use Week (a "Fixed Week") in a
specific Vacation Unit delineated on the Condominium Plan, during
each Use Year, the Association for each Use Year will assign to
such Owner an Assigned Vacation Unit for use and occupancy for such
Owner's Fixed Week, which Unit may or may not be the specific Unit
granted to such Owner in such Owner's deed (thus the reason for the
"Floating Unit" nomenclature) subject to such Owner's first having
reserved such Unit on a "first-reserved, first served" basis
pursuant to this Declaration and the Rules and Regulations.
In the instance of categories 2. and 4. above (Floating
Week/Floating Unit Vacation Ownerships), the Association for each
Use Year will assign to such Owner both an Assigned Unit for his or
her use and occupancy and the Use Week during which the Unit is to
be used, subject to such Owner's first have reserved such Unit and
Use Week on a "first-reserved, first-served" basis pursuant to the
Declaration and the Rules and Regulations. In this connection a
reservation for a Use Week must be made prior to Check-in Time on
the first day of the Use Week sought to be reserved, but not
earlier than 12 months before the commencement of the Use Week
desired by the Owner.
Under any of the four (4) types of Vacation Ownerships, if for
any reason an Owner does not use his or her entire Fixed Week (in
the case of Fixed Week/Floating Unit Vacation Ownerships) or
assigned use Week (in the case of Floating Week/Floating Unit
Vacation Ownerships), there shall be no accrual or carryover of
unused time ("Nights").
c. Nonexclusive Right to Use Accessible Facilities/
Amenities Units. Each Vacation Ownership Owner has also been
granted in the deed to such Owner's Vacation Ownership the
nonexclusive right to access, use for their respective intended
gra!1-03\docs\ccrs.01
(August 31, 1998) 24
purposes, and/or visit, the Accessible Facilities/Amenities Units
(as defined in Section 1.01 below), and only such Accessible
Facilities/Amenities Units, during such Owner's Assigned Use Week.
d. Nonexclusive Right to Go Over and Upon Association
General Use Property to Access Vacation Unit and Facilities/Amen-
ities Units. Each Vacation Ownership Owner has also been granted
in the deed to such Owner's Vacation Ownership the nonexclusive
right to go to, from, over, upon under, across and through (as may
be applicable) the Association General Use Real Property, as such
is delineated on the Condominium Plan, in order to have ingress and
egress to and from such Owner's Assigned Vacation Unit and the
Accessible Facilities/Amenities Units during such Owner's Assigned
Use Week. Vacation Owners shall not use any other Association
Property except as may be authorized by the Declaration or the
Rules and Regulations.
e. "Day-Use". Each Vacation Ownership Owner also shall
have the right to "day-use" of a Vacation Unit and Accessible
Facilities/Amenities Units during such times, and subject to such
restrictions and limitations, as are provided in the Rules and
Regulations.
f. Should an Owner Be Prevented from Using and
Possessing a Vacation Unit. If any Vacation Ownership Owner is
prevented from using and possessing a Vacation Unit during a Use
Year in which such Owner is entitled to such use due to the failure
of the Managing Agent or the Association to fulfill its respective
obligations to such Owner under this Declaration or the Rules and
Regulations, such Owner shall be entitled to receive as
compensation for such loss of use, at such Owner's option: (i) a
cash payment equivalent to the then fair market rental value for
such Owner's Assigned Unit Type; or (ii) the right to use and
occupy a Unit of such Owner's Assigned Unit Type during a Use Week
in place of the Use Week such Owner had been prevented from using,
such Unit to be mutually agreed upon by such Owner and the Managing
Agent and subject to availability of Units of such Assigned Unit
Type, at no additional charge but otherwise subject to the terms
and conditions of this Declaration and the Rules and Regulations.
g. Upkeep of Property. Each Vacation Ownership Owner:
(i) shall keep such Owner's Assigned Vacation Unit, the Common
Furnishings therein, and any and all Association Property such
Owner may use, in good, clean and neat condition, reasonable wear
and tear excepted, and shall not damage or abuse any such property
during such Owner's Assigned Use Week; (ii) shall vacate such
Owner's Assigned Vacation Unit at the expiration of such Owner's
Use Week and remove all persons and such Owner's property therefrom
(excluding, of course, the Common Furnishings therein); and (iii)
shall otherwise comply with the Rules and Regulations as may be in
effect at the time. In addition to the above, no Owner shall make
gra11-03\docs\ccrs.01
(August 31, 1998) 25
or authorize any alterations, additions, or improvements to the
Common Furnishings and/or to any Association Property; nor shall
such Owner remove from such Unit or from the Project, or alter, any
of such Common Furnishings or Association Property.
h. No Use or Occupancy Permitted if Owner is in Breach
of Obligations. Notwithstanding anything to the contrary contained
in this Sections 2.01, but subject to any applicable procedural
requirements set forth in Section 7.02 below, no use or occupancy
of a Vacation Unit, its Common Furnishings, and Association shall
be permitted a Vacation Ownership Owner, if such Owner is in breach
of this Declaration or the Rules and Regulations.
i. Limited Period of Use and Occupancy. Except as
otherwise permitted by this Declaration or the Rules and Regula-
tions, no Vacation Ownership Owner shall occupy a Vacation Unit or
use the Common Furnishings therein or any Association Property
during any time period other than during such Owner's Assigned Use
Week.
j • Use by Others; Owner Still Responsible. A Vacation
Ownership Owner may permit such Owner's Assigned Vacation Unit,
during such Owner's Use Week, to be occupied by said Owner's
Permitted User(s) (but in no event shall the total occupants be in
excess of the number of occupants permitted by the Rules and
Regulations) during such Owner's Use Week; but such Owner shall be
responsible for any loss, damage, or destruction which occurs to
the Common Furnishings or to any Association Property as a result
of such permitted use, or as a result of the violation of this
Declaration or the Rules and Regulations which may occur during
such occupancy, just as if such Owner, had personally occupied such
Unit, used the Common Furnishings therein and/or any Association
Property.
k. Failure to Vacate. If a Vacation Ownership Owner or
such Owner's Permitted User (the "Detaining Owner" or "Detaining
User") fails to vacate his (or her, its, or their) Assigned
Vacation Unit at the end of his Assigned Use Week, or otherwise
makes unauthorized use or occupancy of such Unit, or prevents
another Owner, Permitted User, and/or Exchange User (called here
the "Detained Owner" or "Detained User") from using or occupying a
Unit during such Detained Owner's or User's Assigned Use Week, the
Detaining Owner and/or Detaining User shall: (i) be subject to
immediate removal, eviction, or ejection from the Unit wrongfully
used or occupied; (ii) be deemed to have waived any notice
required by law with respect to any legal proceedings regarding
removal, eviction, or ejection (to the extent that such notices may
be waived under California law); (iii) reimburse the Association
and the Detained Owner and/or Detained User for all costs and
expenses incurred by the latter as a result of such conduct,
including but not limited to costs of alternate accommodations,
gra11-03\docs\ccrs.01
(August 31, 1998) 26
travel costs, court costs, and reasonable attorneys' fees incurred
in connection with removing, evicting, or ejecting the Detaining
Owner and/or Detaining User from such Unit, plus costs (including
reasonable attorneys' fees) incurred in collecting such
reimbursement(s); and (iv) pay to the Detained Owner and/or the
Detained User entitled to use and occupy the Unit during such
wrongful occupancy, as liquidated damages (in addition to the costs
and expenses set forth above), a sum equal to 200 percent of the
then fair rental value per day of the Unit for each day or portion
thereof, including the day of surrender, during which the Detaining
Owner and/or Detaining User prevents use and occupancy of such
Unit; provided, however, that if the Detaining User is an Exchange
User, the Owner whose Use Week was used by such Exchange User shall
have no liability pursuant to the provisions of clauses (i) through
(iv) above. The Board shall have the sole discretion for
determining the "fair rental value" of such a Vacation Unit;
however "fair rental value" for any such Unit shall be based upon
the costs of renting comparable accommodations located in the
vicinity of the Project.
The Association shall use maximum efforts to attempt to remove
such Detaining Owner and/or Detaining User from a Vacation Unit,
and/or to assist the Detained Owner and/or Detained User in finding
alternate accommodations during any such holdover period and to
secure, at the expense of the Association, alternate accommodations
for any Detained Owner and/or Detained User, which alternate
accommodations shall be as near as possible in value to the value
of the Detained Owner's and/or Detained User's Assigned Vacation
Unit, and the cost thereof shall be assessed to the Detaining Owner
(unless the Detaining User was an Exchange User) as a "Personal
Charge" (as defined in Section 6.05 below) . In the event that the
Association, in its sole discretion, deems it necessary to contract
with a holder of outside accommodations for a period greater than
the actual period for which the use is being prevented in order to
secure alternate accommodations as set forth above, the cost of the
entire period shall be assessed to the Detaining Owner as a
Personal Charge.
Furthermore, if a Vacation Ownership Owner and/or such
Owner's Permitted User(s) by an intentional or negligent act
renders the Common Furnishings in a Unit uninhabitable or unusable
for a subsequent Use Week(s), then: (a) such Owner (and/or
Permitted User, if applicable) shall be deemed a Detaining Owner
(and/or Detaining User, if applicable); (b) the foregoing
provisions of this Section 2.04 shall apply; and (c) such Owner
(and Permitted User, if applicable) shall be liable to the Owner(s)
and/or Permitted User(s) of a subsequent Use Week(s) , just as if
such Owner (and Permitted User if applicable) had refused to vacate
the Unit at the end of his, her or their Fixed Use Week(s). For
the purposes of this paragraph, the act or negligence of a
Permitted User shall be deemed to be the act of the Owner
gra11-03\docs\ccrs.01
(August 31, 1998) 27
authorizing occupancy of the Assigned Vacation Unit in question,
and both parties shall be deemed liable for such act or negligence.
1. Maintenance Week. A Maintenance Week is that period
of time occurring during each Use Year, with respect to any
particular Vacation Unit, during which: (i) repairs, restoration
and/or replacement of the Common Furnishings within a Vacation
Unit, and/or (ii) repairs to the Association Real Property
encompassing such Unit, shall be made by the Association. The
Association is given the exclusive right to possess each Vacation
Unit during such respective Maintenance Week and/or to rent out
such Unit to Vacation Ownership Owners or to members of the public
during such Maintenance Week, when such repairs and maintenance are
not at that time required, as provided in Section 2.03 a. 2. below.
2.02 Right of Facilities/Amenities Condominium Owner to Use
Facilities/Amenities Unit and Association General Use Property.
Each Facilities/Amenities Condominium Owner shall be entitled to
use, possess, and operate such Owner's respective Facilities/
Amenities Condominium and the Association General Use Property for
the purposes intended for such in accordance with and subject to
the terms of: (i) such Owner's deed to a Facilities/Amenities
Condominium, if any, (ii) this Declaration, (iii) any Facilities/
Amenities Condominiums Owner(s) Rules and Regulations, and (iv) the
Hotel Owners Use Rights Declaration.
2.03 Right to Lease/Rent Vacation Units.
a. Designated Vacation Units.
1. By Owner other than Declarant. Each Vacation
Ownership Owner, other than Declarant, may rent out to members of
the public such Owner's Assigned Vacation Unit for such Owner's
Assigned Use Week or a portion thereof, subject to any provisions
relating thereto contained in the Rules and Regulations. Rental
moneys therefrom shall be the sole property of such renting Owner.
The cost of repair or replacement incurred by reason of damage or
destruction to the Common Furnishings and/or to any Association
Property, which damage or destruction occurs during and as a result
of the lease or rental of such Unit, shall be the responsibility of
the Owner renting it.
2. By Association—"Bonus Time/Rental Use11. Should
the Association determine that at any time a Designated Vacation
Unit is not being occupied by a Vacation Ownership Owner, such
Owner's Permitted User(s), or an Exchange User pursuant to this
Declaration or the Rules and Regulations, the Association is
authorized to rent out to Vacation Ownership Owners, on a strictly
"first-come/first-served" reservation basis, and to members of the
public, Bonus Time/Rental Use in such a Unit. Any such rental shall
be solely for the benefit of the Association, and all revenues
gral1-03\docs\ccrs.01
(August 31, 1998) 28
derived shall be placed in the Association's operating account to
be used to defray the costs of administering and managing the
Vacation Ownership Operation. Each Owner, by virtue of such Owner's
becoming an Owner of a Vacation Ownership in the Project,
understands and acknowledges that rentals of Bonus Time/Rental Use
by the Association are primarily made as a convenience to the
Owners, giving them the opportunity to enjoy additional time at the
Project, and hereby represents that he, she, or it, as the case may
be, is not purchasing his, her, or its Vacation Ownership with any
intent to in any way profit from the possibility that, as a result
of such rentals of Bonus Time/Rental Use, moneys shall accrue to
the benefit of the Association and thereby, indirectly, to each
Owner, and that no representations from Declarant and/or its agents
have been made to any such effect. Procedures for notifying the
Owners of available Units and for an Owner's reservation thereof
shall be set forth in the Rules and Regulations. The cost of
repair or replacement incurred by reason of any damage and/or
destruction to the Common Furnishings in a Unit and/or to any Asso-
ciation Property which occurs during and as the result of the
rental of such Unit shall be the immediate responsibility of the
renter who rented and took occupancy of said Unit, and where a Unit
is rented to a member of the public the ultimate responsibility for
such damage or destruction shall lie with the Association.
(a) When a Vacation Ownership Owner reserves
a Vacation Unit for Bonus Time/Rental Use, such Owner shall pay a
reasonable rental fee, which shall be fixed from time to time by
the Association. The Association shall limit such rental fees to
the proportionate cost of its operating such Unit for the period of
Bonus Time/Rental Use in question. All rental revenues generated
by Bonus Time/Rental Use of Units shall be deposited in the general
account of the Association to defray its operating expenses.
(b) Reservations for Bonus Time/Rental Use can
only be made 21 days or less prior to Check-in-Time on the date
which such reservation is sought.
(c) An Owner may only have one (1) Bonus
Time/Rental Use reservation pending at a time for each Use Week
such Owner owns.
(d) An Owner may cancel a Bonus Time/Rental
Use reservation up to 24 hours in advance of Check-in-Time on the
first day of the Bonus Time/Rental Use so reserved without penalty.
In the event, however, that an Owner's Bonus Time/Rental Use
reservation is canceled 24 hours or less prior to Check-in-Time on
the first day of the period reserved, such Owner shall be charged
for Bonus Time/Rental Use for the initial day, and the reservation
thereafter will be canceled.
(e) The Association also has a policy called
gral1-03\docs\ccrs.01
(August 31, 1998) 29
"Blue Monday/Blue Tuesday". This is a policy/opportunity by which
more Bonus Time/Rental Use is made available to Owners. At any
time after 48 hours following an Owner's scheduled Check-in Day, if
such Owner has not checked-in or made arrangements for late check-
in, the balance of that Owner's Week shall be made available for
Bonus Time/Rental Use to other Vacation Ownership Owners.
b. Nondesignated Vacation Units - Declarant's Right to
Rent. Declarant reserves full right, authority and power to lease
or rent out at any time to members of the public any or all of the
Nondesignated Vacation Units. Any rental moneys collected from
such rentals shall belong entirely to Declarant. The cost of
repair or replacement incurred by reason of damage or destruction
to the Common Furnishings and/or to any Association Property, which
damage or destruction occurs during and as the result of such lease
or rental of such Unit, shall be the responsibility of the
Declarant.
c. All Lease or Rental Agreements to Be in Writing.
All leases and rentals of a Vacation Unit shall be in accordance
with, and subject to, the terms of: this Declaration and the Rules
and Regulations. Except as to Bonus Time/Rental Use as described
in Paragraph 2.03 a. 2. above, each lease or rental of a Vacation
Unit shall be in writing and shall expressly provide that it is
subject to the terms of this Declaration and the Rules and
Regulations and that failure to use and occupy the Unit, the Common
Furnishings therein, and/or the Association Property in accordance
with such terms shall be a default under such lease or rental
agreement.
2.04 Right of Facilities/Amenities Condominium Owner to Lease/
Rent Owner's Facilities/Amenities Unit. Each Facilities/Amenities
Condominium Owner shall be entitled to lease or rent out such
Owner's respective Facilities/Amenities Unit, subject to any
applicable terms and/or restrictions provided for in this Declara-
tion. Each lessee or renter of a Facilities/Amenities Unit shall
occupy such Unit subject to all for the terms and restrictions
provided in this Declaration and the Rules and Regulations. Any
such lease or rental agreement shall be in writing and shall
expressly provide that it is subject to the terms of this Declara-
tion and the Rules and Regulations, and that failure to use and
occupy a Unit and/or the Association Property in accordance with
such terms shall be a default under such lease or rental agreement.
2.05 Overall Responsibility for Respective Operations within
Proi ect.
a. Responsibility for the Proiect. Association Personal
Property, and Vacation Ownership Operation. The Association shall
have the right, power and duty to administer, manage, and operate:
(i) the Project as a condominium project, (ii) all Association
gra11-03\docs\ccrs.01
(August 31, 1998) 30
Property, and (iii) the Vacation Ownership Operation.
b. Responsibility for the Facilities/Amenities Condomi-
niums Operation. The Declarant shall have the right, power and
duty to administer, manage, and operate the Facilities/Amenities
Condominiums Operation.
2.06 Responsibility for Maintenance.
a. Association Property. The Association shall have
the right, power and duty to maintain, repair, keep clean, repaint
or otherwise refinish or redecorate, and replace and/or restore, as
may be necessary, all Association Real Property and all Association
Personal Property, to the standard that all such Property is at all
times kept in clean, sanitary, workable, attractive, and "first-
class" condition, so that the appearance and value of such
Association Property, and the Project as a whole, are preserved.
Notwithstanding anything in the above paragraph to the
contrary, the Association may delegate to and authorize the
Owner (s) of one or more Facilities/Amenities Condominiums (but only
by mutual agreement between the Association and such Owner(s)) to
perform, and pay for directly, certain maintenance of and upkeep to
any Association Property which is used solely or predominantly by
such Owner(s) and their Permitted Users. Expenses incurred in
connection with such maintenance and upkeep (in lieu of being Sole
Basic Expenses or Project Basic Expenses) will in such event be the
responsibility of such Owner(s) and not the Association.
b. Facilities/Amenities Condominium Owner's Personal
Property in Facilities/Amenities Units. The Owner of each
Facilities/Amenities Unit shall have the right, power, and duty, at
such Owner's expense, to maintain, repair, keep clean, repaint or
otherwise refinish or redecorate, and replace and/or restore, as
may be necessary, all Facilities/Amenities Condominium Owner's
Personal Property belonging to such Owner located within such Unit,
to the standard that such Personal Property is at all times kept in
clean, sanitary/ workable, attractive, and "first-class" condition,
so that the appearance and value of that particular Facilities/
Amenities Unit, and the Project as a whole, are preserved.
c. Common Furnishings in Vacation Units. The Associa-
tion shall have the right, power and duty, at such Association's
expense, to maintain, repair, keep clean, repaint or otherwise
refinish or redecorate, and replace and/or restore, as may be
necessary, all Common Furnishings in the Vacation Condominiums, to
the standard that such Common Furnishings are at all times kept in
clean, sanitary, workable, attractive, and "first-class" condition,
so that the appearance and value of the Vacation Units, and the
Project as a whole, are preserved.
gral1-03\docs\ccrs.01
(August 31, 1998) 31
d. Right of Association to Perform Maintenance upon a
Facilities/Amenities Condomjnium Owner's Nonperformance. In the
event a Facilities/Amenities Condominium Owner fails to perform any
of the maintenance required of such Owner under this Section 2.06,
the Board shall notify such Owner in writing of the work required.
In the event that such work is not performed within 60 days from
the delivery of such notice, authorized agents or employees of the
Board shall have the right to enter the Facilities/Amenities Unit
in question, and/or upon the Association Real Property, as the case
may be, to cause such work to be completed and assess the cost
thereof to such responsible Owner.
e. Arbitration of Disputes. In the event of any
irreconcilable dispute between or among any of the following: the
Declarant, any Vacation Ownership Owner(s), any Facilities/
Amenities Condominium Owner (s) , and/or the Association, relating to
maintenance and upkeep or payment responsibility under this Section
2.06, any of such party may cause the same to be referred to
binding arbitration, in accordance with Section 16.09 below.
2.07 Allocation of Association Expenses and Sharing of Certain
Expenses with Hotel Prolect.
a. General Theory and Basis for Allocation of Condo-
minium Owners Association Expenses and Assessments. The Associa-
tion shall have the duty to pay for any and all Project Basic
Expenses, Project Special Expenses, Sole Basic Expenses and Sole
Special Expenses, as each of these terms is defined in Article 1.
In turn, the Association shall raise the moneys required to pay
these Expenses from the Assessments it levies and collects from all
Condominium Interest Owners (that is, from both the Vacation Owner-
ship Owners and the Facilities/Amenities Condominiums Owner(s). In
this connection, it is determined to be fair and equitable that the
Vacation Ownership Owners pay only that portion of these Expenses,
and their corresponding Assessments, which are attributable to the
Vacation Condominiums, and that the Facilities/Amenities Condo-
minium Owner (s) pay only that portion of these Expenses, and their
corresponding Assessments, which are attributable to the Facili-
ties/Amenities Condominiums.
Accordingly, to accomplish the foregoing, the following cate-
gories of Condominium Owners Association Expenses have been
created:
1. Sole Basic and Special Expenses. Sole Basic
Expenses and Sole Special Expenses means those expenses of the
Association determined by that Association to be attributable to,
and payable by, only Vacation Ownership Owners, or by only
Facilities/Amenities Condominium Owners. Therefore, Vacation
Ownership Owners, owning the Vacation Condominiums, shall be
responsible for paying any and all Sole Basic Expenses and Sole
gral1-03\docs\ccrs.01
(August 31, 1998) 32
Special Expenses, and their corresponding Assessments, determined
by the Association to be attributable solely to the Vacation
Condominiums. Likewise, the Owner(s) of a particular Facilities/
Amenities Condominium shall be responsible for paying any and all
Sole Basic Expenses and Sole Special Expenses, and their
corresponding Assessments, determined by the Association to be
attributable solely to that particular Condominium.
2. Project Basic and Special Expenses. Project
Basic Expenses and Project Special Expenses means those expenses of
the Association determined by the Association to be attributable
to, and payable by, all Condominium Interest Owners (that is, by
both Vacation Ownership Owners and the Facilities/Amenities
Condominium Owners).
b. Board to Determine Expense Type. The Board, in its
sole discretion, shall as to each and every Association expense,
including each capital expenditure, classify such expense, by
expense type, as either a: (i) Project Basic Expense, (ii) Project
Special Expense, (iii) Sole Basic Expense, or (iv) Sole Special
Expense, with the objective in mind that each such classification
shall be "fair and equitable." The determination of what is fair
and equitable, as to any particular expense, including any capital
expenditure, shall be made after the Board has considered all
relevant factors related to such expense. Relevant factors shall
include, but not necessarily be limited to: (i) the relative
degrees of use of the property or services by the Vacation
Ownership Owners and the Facilities/Amenities Condominium Owner (s),
respectively, giving rise to such expense; (ii) the relative
degrees of benefit resulting from such expense to the Vacation
Ownership Owners and the Facilities/Amenities Owners, respectively;
(iii) the relative cost of construction of the materials and labor
(in final form, constituting Association Real Property) required to
house (encompass) the Vacation Units and the various
Facilities/Amenities Units, and (iv) the respective square footages
of the various Condominium Units whose Owners (whether Vacation
Ownership Owners or Facilities/Amenities Condominium Owners) are
receiving the benefits from payment of such expense.
Notwithstanding anything in the foregoing to the contrary,
expenses and capital expenditures incurred in connection with the
Vacation Ownership Operation shall be a Sole Basic Expense or Sole
Special Expense, as the case may be, of the Vacation Ownership
Owners, for which corresponding Assessments shall be levied only
against the Vacation Ownership Owners.
c. Arbitration of Disputes. In the event of any
irreconcilable dispute between or among any of the following: the
Declarant, any Vacation Ownership Owner(s), any Facilities/Ameni-
ties Condominium Owner, and/or the Association, relating to the
determination of expense type by the Board, any such party may
gra11-03\docs\ccrs.01
(August 31, 1998) 33
cause the same to be referred to binding arbitration, in accordance
with Section 16.09 below.
d. Sharing of Certain Expenses With Hotel. Declarant has
constructed, or is in the process of constructing, a hotel on
certain real property adjoining the Land (the "Hotel Project").
Because the Hotel Project and the Condominium Ownership Operation
upon the Land described in this Declaration will both contain
buildings and other improvements, and encompass operations, which
will serve the vacationing and traveling public, certain cost and
operating efficiencies will result to both such operations, if in
certain instances, they both will utilize the same firm for
providing identical or similar services to the two operations, such
as providing for example, but not to be limited to: property
management, maid and general housekeeping, and maintenance and
repair. In this connection, the Association and the Declarant have
entered into a written agreement called the "Grand Pacific
Palisades Resort and Hotel Cost-Sharing Agreement," which provides
for the allocation between the Association and the owner of the
Hotel Project of such commonly-incurred expenses on a fair and
equitable basis.
2.08 Allocation of Distributable Net Proceeds Among Owners.
a. General. The Association shall allocate in a fair
and equitable manner among the various affected Owners, that is,
among the Vacation Ownership Owners and the Facilities/Amenities
Condominium Owners, or among some of them, or among only Vacation
Ownership Owners, or among only Facilities/Amenities Condominium
Owners, whichever the facts and equity may dictate, and shall pay
to them, any and all moneys it receives which constitute Distribut-
able Net Proceeds (as defined in Section 1.57).
b. Allocation Determination. The Board shall initially
make a determination as to the particular Vacation Units and/or
Facilities/Amenities Units to which any such Distributable Net
Proceeds are attributable. Following that determination, the Board
shall allocate such Distributable Net Proceeds among the respective
Owners of such Units. The portion of any such Distributable Net
Proceeds attributable to the applicable Vacation Units shall be
allocated to the Vacation Ownership Owners in the proportion that
the total square footage of all Vacation Units in the Project to
which such Distributable Net Proceeds are attributable bears to the
total square footage of all those Condominium Units in the Project
to which such Distributable Net Proceeds are attributable, and then
further allocated by the Board upon a "fair and equitable basis,"
as defined below, among, and be paid to, such Vacation Ownership
Owners. The remaining portion of such Distributable Net Proceeds,
attributable to some or all of the Facilities/Amenities Units,
shall be allocated by the Board upon a "fair and equitable basis,"
as defined below, among, and be paid to, the Facilities/Amenities
gra11-03\docs\ccrs.01
(August 31, 1998) 34
Condominium Owners to whose Units the remaining Distributable Net
Proceeds are attributable.
c. "Fair and Equitable Basis". What is a "fair and
equitable basis" as the expression is used in Paragraph b. above,
shall be a determination made by the Board after it has considered
all relevant factors related to making the required allocation.
Relevant factors shall include, but not necessarily be limited to:
(i) the relative cost of construction of the materials and labor
(in final form, consisting of Association Real Property) required
to house (encompass) each Facilities/Amenities Unit, and (ii) the
respective square footages of the various Facilities/Amenities
Condominiums to which such Distributable Net Proceeds are
attributable.
d. Payment Subject to Prior Claims. Each Owner entitled
to receive Distributable Net Proceeds shall receive such Owner's
share less: (i) any pending amount due the Association by such
Owner, (ii) any taxes due by such Owner to any governmental
authority, and (iii) any amounts required by a Mortgagee of such
Owner.
2.09 Owner's Obligations to Pay Taxes. Each Condominium
Interest Owner shall be obligated to pay all property taxes,
assessments, and other charges (real or personal) related to such
Owner's Condominium Interest (Vacation Ownership or Facilities/
Amenities Condominium). If these taxes have not been segregated by
the County Assessor of San Diego County and billed separately to
each Owner, they shall be deemed a Project Basic Expense and shall
be paid for from moneys raised by the Regular Annual Assessments.
2.10 Right to Mortgage Condominium Interest and First
Mortgagee Safety. Each Condominium Interest Owner shall have the
right to mortgage or otherwise encumber all, but not less than all,
of such Owner's Condominium Interest (Vacation Ownership or
Facilities/Amenities Condominium). Any such mortgage shall be
subordinate to all of the provisions of this Declaration, and in
the event of foreclosure, the provisions of this Declaration shall
be binding upon any Owner whose title is derived through
foreclosure by private power of sale, judicial foreclosure,
assignment in lieu of foreclosure, tax deed or otherwise.
Notwithstanding any other provisions of this Declaration, no breach
of the provisions of this Declaration, nor the enforcement of any
lien created pursuant to the provisions hereof shall defeat or
render invalid the lien of any first (in recording priority)
Mortgage upon any Condominium Interest, so long as such first
Mortgage has been recorded in the Official Records, of San Diego
County, California, and has been given in good faith and for value.
2.11 Right to Enter Other Condominium Units. Any Condominium
Interest Owner, such Owner's authorized agent, the Managing Agent,
gra11-03\docs\ccrs.01
(August 31, 1998) 35
or any other authorized agent of the Association may enter any
Condominium Unit at any time and without having to give notice to
any occupant(s) thereof, in order to abate any nuisance or any
dangerous, unauthorized, prohibited, or unlawful activity being
conducted or maintained therein or to assist (including making
repairs or rendering other services) in the event of any emergency
involving illness or existing or potential danger to life or
property. Any such right to entry shall be exercised in such a
manner as to avoid any unreasonable interference with the use and
occupancy of the Condominium Unit in question.
2.12 Easements for Encroachments. If any portion of the
Association Real Property encroaches upon any Condominium Unit, or
if any portion of a Condominium Unit encroaches on any Association
Real Property, regardless of the cause, a valid easement shall and
does exist for such encroachment and for the maintenance of it as
long as it remains; and all Condominium Units and the Common Area
are created, made, constructed, and held subject to such easements.
If any structure containing a Condominium Unit is partially or
totally destroyed and then rebuilt and any encroachment upon the
Association Real Property thereby results, a valid easement shall
exist for such encroachment and for the maintenance of it for so
long as it remains, and all Association Real Property is held
subject to such easement.
2.13 Easements and Certain Other Rights Reserved by Declarant
to Which Owners Take Subject.
a. Easements Reserved by Declarant with Respect to
Development. Declarant, on behalf of itself, its successors and/or
assigns, and its and their respective agents, employees,
concessionaires, contractors, subcontractors, invitees, patrons,
and authorized personnel, has reserved, or will reserve, for the
respective terms provided for below, certain nonexclusive easements
in gross to Declarant, its successors and assigns, and its and
their respective agents, employees, and authorized personnel, to,
from, over, under, across and through the Land, including
Association Real Property, for the following purposes:
1. For doing and performing all acts related to
constructing, completing, and/or repairing the Improvements in each
contemplated Phase of the Development, including without
limitation, maintaining temporary construction-related structures
and operating and storing construction equipment, tools, and
vehicles;
2. For enabling the discharge of any duty of
Declarant, and/or any of Declarant's successors and/or assigns,
under this Declaration or under any Purchase Agreement, or as
otherwise may be imposed by law;
gra11-03\docs\ccrs.01
(August 31, 1998) 36
3. For offering for sale, selling, leasing,
renting, or otherwise transferring any Vacation ownership in any
Vacation Condominium upon the Land (including any Annexed
Property), including any Vacation Ownership reacquired by Declarant
through foreclosure or a deed-in-lieu of foreclosure;
4. For maintaining customer relations and for
providing post-sale services to the Vacation Ownership Owners;
5. For maintaining laundry and vending machine
facilities, and television, radio, and communication antennae,
satellite dish(es), flag poles and other external fixtures, and for
all replacements thereof;
6. For displaying signs and erecting, maintaining,
and operating, in connection with the marketing and sales of
Vacation Ownerships and services and products related thereto or of
similar nature, and for administrative purposes, model units, and
a customer service, sales office and/or administration office
complex;
7. For showing unoccupied Vacation Units, including
having access thereto over the Association General Use Real
Property, to prospective purchasers, lessees, tenants, business
visitors and/or guests; and
8. For having and providing switchboard,
registration, laundry, mail, maintenance, and related such services
in and to the Project, prior to any such services being provided by
the Association.
Declarant covenants to use each of the above easements in a manner
that will reasonably minimize any adverse impact therefrom upon the
possession, use, and enjoyment of the Project by the Owners.
The terms (duration) for each of the above listed easements shall
commence from the date of recordation of this Declaration in the
Official Records of San Diego County, California (called here the
"Commencement Date"), and shall continue:
— As to the easement referred to in Paragraph 1. above, until
the earliest of: (i) 15 years from the Commencement Date, or (ii)
the date upon which all Vacation Ownerships in the Real Property
have been sold (and their escrow closed) by Declarant and/or its
successors and assigns if any, and all security interests (such as
deeds of trust) representing security held by Declarant and/or its
successors and assigns, if any, for credit sales of Vacation
Ownerships have been released or reconveyed; and
— As to the easements referred to in Paragraphs 3., 6., 7.,
and 8. above, until the earliest of: (i) 15 years from the
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(August 31, 1998) 37
Commencement Date, unless Declarant has recorded during said 15-
year period in the Official Records of San Diego County,
California, a Declaration of Annexation as described in Article 13
of this Declaration, by which, the Declaration is imposed on any
remaining Annexable Property, or (11) if Declarant has recorded the
foregoing Declaration of Annexation, until the earliest of 15 years
from the date of recordation of any such Declaration of Annexation,
or the date upon which all Vacation Ownerships in any such Annexed
Property have been sold (and their escrows closed) by Declarant
and/or its successors and assigns, if any, and all Mortgages
representing security held by Declarant and/or successors and
assigns, if any, for credit sales of Vacation Ownerships have been
released or reconveyed; and
— As to the easements referred to in Paragraphs 2., 4. and 5.
above, for the duration of the Project.
b. Owner's Acknowledgment of Easement Rights. Each
Owner acquiring a Condominium Interest (Vacation Ownership or
Facilities/Amenities Condominium) referred to in this Declaration
accepts such Owner's Condominium Interest subject to each of the
easement rights in favor of Declarant provided for in this Section
2.13.
c. Indemnification of Owners. Declarant hereby agrees
to indemnify each Condominium Interest Owner against, and hold each
such Owner harmless from, any and all claims, liabilities, and
demands of any sort, which may arise against any such Owner out of
the use by Declarant and/or its agents, employees, contractors, and
subcontractors, of any of the easements reserved in this Section
2.13.
2.14 Easements in Favor of Hotel Owners and Users. Each
Condominium Interest Owner takes such Owner's Condominium Interest
(Vacation Ownership or Facilities/Amenities Condominium) subject to
those certain easements in favor of the owner and various users of
the hotel constructed, or to be constructed, upon certain real
property adjoining the Land, each such easement being identified
and described in the Hotel Owners Use Rights Declaration, defined
in Section 1.73 below.
2.15 Nonseverabilitv of Components of Condominium upon
Transfer of a Condominium Interest. The components of each type of
Condominium (Vacation Condominium and Facilities/Amenities
Condominium) shall not be separated in ownership from each other,
except, of course, Vacation Ownerships within a Vacation
Condominium may be separately conveyed. Any attempted sale,
conveyance, hypothecation, encumbrance, or other transfer of less
than all of these components in any such Condominium shall be null
and void. Any sale, conveyance, hypothecation, encumbrance or
other transfer of a Condominium Interest shall be deemed to
gra11-03\docs\ccrs.01
(August 31, 1998) 38
automatically transfer with it all of said components. In
addition, the sale of other transfer of a Condominium Interest
shall operate to transfer automatically to the succeeding Owner(s)
any and all interest of the prior Owner (s) in any funds in the
Association, even if not expressly mentioned in the instruments(s)
of transfer. Nothing contained in this Section 2.15, however,
shall preclude an Owner from creating a cotenancy or joint tenancy
in the ownership of any such Condominium Interest (Vacation
Ownership or Facilities/Amenities Condominium) with any other
person or persons.
2.16 Subordination
Declaration and
of Tenancy-in-Common Attributes to
nits'Ohibition Against Partition of Condomini
It is intended that this Declaration, the Articles, the By-Laws,
the Rules and Regulations, and the deed granting any Condominium
Interest shall be determinative with respect to the use,
possession, enjoyment, management, and disposition of the Project
or any interest therein. Accordingly, any and all rights with
respect to the use, possession, enjoyment, management, or
disposition of all or any portion of the Project or any interest
therein to which a Condominium Interest Owner might otherwise have
as a tenant-in-common (including, but not limited to, any common
law or statutory right jointly to use, possess, or manage commonly
owned property) are hereby unconditionally and irrevocably
subordinated to this Declaration for so long as this Declaration
shall remain in effect. Furthermore, in this connection, no
Vacation Ownership Owner may seek or obtain, through any legal
procedure, judicial partition of any Vacation Unit, or sale of a
Vacation Unit in lieu of such partition; provided, however, the
foregoing shall not be deemed to prohibit a sale of a Vacation Unit
on termination of the Project or removal of such Unit from the
Project in accordance with other provisions of this Declaration.
Further, nothing in the foregoing shall be construed to prohibit
the sale of a Facilities/Amenities Unit, as part of the sale of the
Facilities/Amenities Condominium, of which such Unit is a part, by
the Owner of such Facilities/Amenities Unit.
2.17 Common Furnishings and Association Property. The Associa-
tion shall from time to time acquire legal title to Common Furni-
shings. All such Common Furnishings shall be held, managed, and
maintained for the benefit of the Vacation Ownership Owners. The
Association shall also acquire Association Real Property from the
Declarant and shall purchase certain Association Personal Property.
All such Association Property shall be held, managed, and main-
tained for the benefit of all Condominium Interest Owners.
2.18 Limitations on Partition of Common Area. Section 1359 of
the California civil Code requires that the Common Area remain
undivided; and, except as provided below, there shall be no
judicial partition of the Common Area. A Condominium Interest
Owner(s) may, however, maintain such a partition action as to the
gra11-03\docs\ccrs.01
(August 31, 1998)39
entire Project as if all Owners were tenants-in-common in the
entire Project in the same proportion as their respective interests
in the Common Area. The court shall order partition in such
instance only by sale of the entire Project and only upon showing
of one of the following:
a. More than three (3) years before the filing of the
partition action, the Project was damaged or destroyed to the
extent that a material part was rendered unfit for its prior use,
and the Project has not been rebuilt or repaired substantially to
its state prior to the damage or destructions.
b. Three-fourths (3/4) or more of the Project was
destroyed or substantially damaged, and the Owners holding in the
aggregate more than a fifty percent (50%) interest in the Common
Area oppose repair or restoration of the Project.
c. The Project has been in existence more than fifty
(50) years, is obsolete and uneconomic, and Owners holding in the
aggregate more than a fifty percent (50%) interest in the Common
Area oppose repair or restoration of the project.
d. The conditions for a sale of the Project, as set
forth in this Declaration, have been satisfied.
2.19 Specific Use Restrictions. In addition to all of the
other restrictions herein contained, the use and occupancy of any
portion of the Project, including, without limitation, the Vacation
Units, the Facilities/Amenities Units, the Association Real
Property, the Common Area, the Association Personal Property, and
the Common Furnishings, are subject to the following conditions:
a. Use of Vacation Units. Each Vacation Unit shall be
used strictly for the occupancy, use, and enjoyment of the Vacation
Ownership Owners and their Permitted Users; provided, however,
Declarant, and its successors and/or assigns, may use any such
Units as display models and/or as a sales office complex in
connection with offering for sale of Vacation Ownerships to the
public, and any such Unit or Units may be used as Declarant's
office for administering construction of the Development or other
affairs related thereto, as provided more specifically in Section
2.13 above.
b. No Nuisances. No noxious, illegal, or offensive
activities shall be carried on in any portion of the Project; nor
shall anything be done therein or thereon which may be or may
become an annoyance or a nuisance which in any way will interfere
with the quiet enjoyment of each Condominium Interest Owner's
respective use of a Vacation Unit or a Facilities/Amenities Unit or
which shall in any way increase the rate of insurance for any part
of the Project, or cause any insurance policy to be canceled or
gra!1 -03\docs\ccrs.01
(August 31, 1998) 40
cause a refusal to renew any such policy.
c. Signs. No sign of any kind shall be displayed for
public view from any Condominium Unit or from any other part of the
Project without the approval of the Board, except that signs,
billboards, and other advertising devices or structures used by
Declarant in connection with advertising for sale and selling
Vacation Ownerships are expressly permitted.
d. No Advertising Materials. No "For Sale" or any
other advertising or marketing materials shall be placed upon or in
the Vacation Units (except in model Vacation Units), or distributed
or displayed upon any other portion of the Project without approval
of the Board.
e. No Animals. No animals of any kind shall be raised,
bred, or kept in any Condominium Unit or on any other portion of
the Project.
f. Garbage and Refuse Disposal. All rubbish, trash and
garbage shall be regularly removed from the Condominium Units and
from the reminder of the Project, and shall not be allowed to
accumulate thereon. Trash, garbage and other waste shall be kept
in sanitary containers.
g. Antennae; External Fixtures. No television, radio,
or communications antennae, satellite dish(es), flag poles, or
other external fixtures, other than those installed and retained by
Declarant pursuant to Section 2.13 above, and replacements thereof,
or as otherwise approved by the Board shall be constructed, erected
or maintained on or within the Project.
h. No Clotheslines. No exterior clotheslines shall be
erected or maintained anywhere on the Project, nor shall outside
laundering or drying of clothes be permitted anywhere on the
Proj ect.
i. No Car Maintenance. No car maintenance of any
nature, except for short-term emergency repairs, shall be permitted
on the Project.
2.20 Indemnification of Associations and Owners. Each
Condominium Interest Owner shall be liable to the Association
and/or to other Condominium Interest Owners, as their respective
interests appear, for any damage to, or loss of: Association
Property, Common Area, Common Furnishings, and/or a Facilities/
Amenities Condominium Owner's Personal Property, that may be
incurred by reason of the negligence or willful act of that Owner,
and/or such Owner's Permitted User(s) to the extent that any such
damage is not covered by insurance maintained by the Association.
Further, each Condominium Interest Owner, for himself, herself,
gra11-03\docs\ccrs.01
(August 31, 1998) 41
itself and themselves, and for such Owner's Permitted User(s),
agrees to indemnify the Association and each and every other
Condominium Interest Owner, and to hold them harmless from, and to
defend them against (and pay their reasonable attorneys' fees and
costs incurred in such defense) , the claim of any person for
personal injury and/or property damage which may result from such
Owner's or Permitted User's use and occupancy of a Condominium Unit
and/or any other portion of the Project. Nothing in the foregoing
shall be deemed to preclude such Association from purchasing
insurance on behalf of its Members which insures against said
risks.
ARTICTiB 3
PROTECTION OF THE REAL PROPERTY, ASSOCIATION PERSONAL
PROPERTY. COMMON FURNISHINGS. AND FACILITIES/AMENITIES
CONDOMINIUM OWNERS' PERSONAL PROPERTY FROM LIENS
3.01 Real Property. Association Personal Property. Common
Furnishings, and Any Facilities/Amenities Condominium Owner's
Personal Property to Be Maintained Free of Liens. Except as
provided in Section 2.08 above, no Condominium Interest Owner shall
permit such Owner's Condominium Interest to be subject to any lien
(other than the liens of current real property taxes), claim or
charge, the enforcement of which may result in a sale or threatened
sale of all or any portion of the Real Property, the Association
Personal Property, the Common Furnishings, and/or any Facilities/
Amenities Condominium Owner's Personal Property, or in any
interference in the use or enjoyment of the Project by any other
Owner. In the event of a threatened sale of the Real Property, the
Association Personal Property, the Common Furnishings, and/or any
Facilities/Amenities Condominium Owner's Property, or any interest
therein, or should the use and enjoyment of any portion of such
Real Property, Association Personal Property, Common Furnishings,
and/or Facilities/Amenities Condominium Owner's Personal Property,
by an Owner be threatened by a reason of any such lien, claim, or
charge made against the Condominium Interest of another Owner, or
should proceedings be instituted to effect such a sale or
interference, any Owner or Owners, or the Association acting on
behalf of all Owners, may, but shall not be required to, pay or
compromise the lien, claim, or charge without inquiring into the
proper amount or the validity thereof. In such event, the
responsible Owner(s) whose Condominium Interest was subjected to
such lien, claim, or charge shall forthwith pay the amount so paid
or expended to the other Owner(s) and/or Association, whomsoever
shall have paid or compromised such lien, claim, or charge,
together with such reasonable attorneys' fees and related costs as
may have been incurred. If the Association pays the lien, claim, or
charge, it shall levy a Special Assessment against the responsible
Owner(s) whose interest(s) was subject to such claim, lien, or
charge for the amount so paid, together with such reasonable
gral1-03\docs\ccrs.01
(August 31, 1998) 42
attorneys' fees and related costs as may have been incurred.
Furthermore, no Owner shall permit such Owner's interest in any
funds from time to time in the possession of the Association, to
be made subject to any attachment, lien, claim, charge, or other
legal process; and each such Owner shall promptly restore any funds
held by the Association with respect to such Owner's Condominium
Interest to the extent depleted by reason of the assertion of any
such attachment, lien, claim, charge or other legal process and
shall reimburse the Association for all reasonable attorneys' fees
and other costs incurred with respect thereto.
3.02 Association to Defend Certain Actions. In the event
that a lawsuit is brought against all or substantially all of the
Owners which will or could result in a lien, claim, charge, or
other encumbrance being levied against all of any portion of the
Real Property, including their respective Condominium Interests,
the Association Personal Property, the Common Furnishings, and/or
any Facilities/Amenities Condominium Owner's Personal Property, or
any interest therein, the Association shall promptly cause such
lawsuit to be defended and/or settled, and all costs of such
defense and/or settlement shall be made a Special Assessment to be
levied against all of the Owners joined as defendants in such
lawsuit; provided, however, in the event that an insurance carrier
is obligated to provide such defense under a policy of insurance
carried by the Association, the Association shall be relieved of
the obligation to provide such defense. Nothing contained herein
shall in any way limit the rights of any such Owner(s) to retain
counsel of such Owner's choice and expense to represent such
Owner(s) in such lawsuit, but in such event, such Owner shall not
be relieved of liability for the Special Assessment provided for in
this section.
3.03 Payment of Lien. In the event that a lien or encumbrance
not covered by California Civil Code Section 1357 (pertaining to
mechanics' liens) or any successor statute thereof attaches to all
or any portion of the Real Property, including any Condominium
Interest, the Association Personal Property, the Common Furni-
shings, and/or any Facilities/Amenities Condominium Owner's
Personal Property, or any interest therein, by reason of a judgment
or otherwise, the Association shall promptly take appropriate steps
to remove such lien, including, but not limited to, the payment of
money and/or the posting of a bond. The Association shall have the
power to borrow money and to take such other steps as are necessary
to free such Real Property, Association Personal Property, Common
Furnishings, and/or Facilities/Amenities Condominium Owner's
Personal Property from any such lien. Simultaneously with any
action taken pursuant to this section, the Association shall levy
a Special Assessment against: (i) those Owners whose acts or
omissions to act caused the lien to be attached to such Real
Property, Association Personal Property, Common Furnishings, and/or
any Facilities/Amenities Condominium Owner's Personal Property, to
gra11-03\docs\ccrs.01
(August 31, 1998) 43
be paid by each such Owner on a pro rata basis, or (ii) all Owners,
if the lien in question was not incurred by acts or omissions to
act of any particular Owner(s), any such Special Assessment to be
in the amount of all costs, including reasonable attorneys fees,
which were incurred by the Association in removing such lien.
3.04 Reimbursement to Association. Upon the Association's
taking any of the actions (including, without limitation, paying
moneys to defend against lawsuits and paying liens, claims,
charges) under this article to prevent threatened liens, claims, or
charges from being imposed against any portion of the Real
Property, including any Condominium Interests, the Association
Personal Property, the Common Furnishings, and/or any Facilities/
Amenities Condominium Owner's Personal Property, or to remove said
liens, claims or charges once they have become attached thereto,
the Association, notwithstanding anything in this Article 3 to the
contrary, shall have the right to levy Special Assessments to
recoup such moneys paid out against every Condominium Interest
Owner, and not only against the particular responsible Owners
referred to in Sections 3.01, 3.02, and 3.03 above (called here the
"Responsible Owners"), in those instances where the Association
believes that such Special Assessments against all such Owners
would be in the best financial interests of a majority of all
Owners. In such event, however, the Association shall still be
required to independently levy Special Assessments against the
Responsible Owners for the recoupment of any such levied moneys.
ARTICLE 4
THE ASSOCIATION
4.01 Association. Administration, management, and control of
the Project, the Association Personal Property, the Vacation
Ownership Operation shall be, and is, vested in the Association for
the benefit and on behalf of the Condominium Interest Owners,
effective upon recordation of the Original Deed evidencing the
initial complete sale and conveyance by Declarant of a Vacation
Ownership.
4.02 Membership in Association. Each Condominium Interest
Owner (Vacation Ownership Owner, including Declarant as to each
Declarant Vacation Ownership, and Facilities/Amenities Condominium
Owner, including Declarant as to each such Condominium owned by
Declarant), shall be a Member of the Association and shall remain
a Member thereof until such Owner ceases to be such an Owner.
Ownership of a Condominium Interest shall be the sole qualification
for Membership.
4.03 Transfer of Membership. The Membership of each
Condominium Interest Owner in the Association is appurtenant to and
inseparable from such Owner's Condominium Interest (Vacation
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(August 31, 1998) 44
Ownership or Facilities/Amenities Condominium), and shall be
automatically transferred upon any subsequent transfer or
conveyance of such Owner's Condominium Interest to such Owner's
transferee; otherwise, said Membership shall be nontransferable,
and any attempt to make a prohibited transfer shall be void.
4.04 Classes of Membership. The Association shall have the
following classes of voting Membership:
a. With Respect to Matters Pertaining to Only the
Project and/or the Association Personal Property. With respect to
matters pertaining to only the Project and/or the Association
Personal Property, the following four (4) classes of Membership
shall exist:
1. Class "A" Membership. Class "A" Members shall
be all Annual Vacation Ownership Owners, except Declarant as to
Declarant Annual Vacation Ownerships (until Declarant as to such
Ownerships becomes a Class "A" Member pursuant to Subsection 4.04
c. below) Each Class "A" Member, as to Association matters, shall
be entitled to two (2) votes for each Annual Vacation Ownership
owned; provided, however, that while an Annual Vacation Ownership
may be owned by several Owners, and while all such Owners will be
Members, multiple Owners of one (1) Annual Vacation Ownership shall
have only two (2) votes, which votes shall be exercised in one
block (that is, cast as two [2] votes for or against the matter at
issue, and shall not be split), as these multiple Owners, among
themselves, shall decide.
2. Class "B" Membership. Class "B" Membership
shall be all Biennial Vacation Ownership Owners, except Declarant
as to Declarant Biennial Vacation Ownerships (until Declarant, as
to such Ownerships, becomes a Class "B" Member pursuant to Section
4.04 c. below). Each Class "B" Member, as to Association matters,
shall be entitled to one (1) vote for each Biennial Vacation
Ownership owned; provided, however, that while a Biennial Vacation
Ownership may be owned by several Owners, and while all such
Owners would be Members, multiple Owners of one (1) Biennial
Vacation Ownership shall have only one (1) vote, which collective
vote shall be exercised as these multiple Owners, among themselves,
shall decide.
3. Class "C" Membership. The Class "C" Member
shall be the Declarant, who shall be entitled to two (2) votes for
each Declarant Annual Vacation Ownership and to one (1) vote for
each Declarant Biennial Vacation Ownership. Said Class "C"
Membership shall cease and be automatically converted to "regular"
Class "A" and/or Class "B" Membership, as appropriate, on the first
of the following dates to occur: (i) that date which is the second
(2nd) anniversary after the recording date of the first Original
Deed of a Vacation Ownership following Declarant's completion of
gral1-03\docs\ccrs.01
(August 31, 1998) 45
Phase III of the Development, or (ii) on that date which is the
eleventh (llth) anniversary following the recording of the first
Original Deed of a Vacation Ownership in Phase I of the Project.
At any point in time before the above conversion, Declarant
shall be deemed to be the Owner of that number of Vacation
Ownerships in the Project equal to the excess of the total number
of Vacation Ownerships in both Designated and Nondesignated
Vacation Units in each developed Phase (that is, a Phase upon which
Improvements have been constructed and in which Declarant may offer
for sale and sell Vacation Ownerships) over the total number of
such Vacation Ownerships conveyed by Declarant to third parties by
Original Deeds (and not thereafter reacquired in any manner by
Declarant), keeping in mind that Declarant shall be treated as
owning unsold Vacation Ownerships in each Nondesignated Unit in
each such developed Phase as well as in each Designated Unit
therein.
4. Class "D" Membership. Class "D" Members shall
be all Facilities/Amenities Condominium Owners. Each such Class
"D" Member, as to Association matters, shall be entitled to 102
votes (51 [the number of Use Weeks for each Vacation Unit]
multiplied by 2 [the number of votes allowed to each Owner of an
Annual Vacation Ownership]) for each Facilities/Amenities
Condominium owned; provided, however, that while a Facilities/
Amenities Condominium may be owned by several Owners, and while all
such Owners will be Members, multiple Owners of one such
Facilities/Amenities Condominium shall have only the foregoing 102
votes, which votes shall be exercised in one block (that is, cast
as 102 votes for or against the matter at issue, and shall not be
split), as these multiple Owners, among themselves, shall decide.
(Giving each such Facilities/Amenities Condominium Owner 102 votes
places each such Owner on an identical parity with the other
Members, in that each such Facilities/Amenities Owner uses such
Owner's Facilities/Amenities Unit: (i) annually (not biennially),
and (ii) for at least the period of each calendar year encompassing
at least 51 Use Weeks.)
b. With Respect to Matters Pertaining to Only the
Vacation Ownership Operation. With respect to matters pertaining to
only the Vacation Ownership Operation, the Association shall have
the same Class "A", Class "B", and Class "c" Memberships, as
provided under Section 4.04 a. above, but shall not have the Class
"D" Membership provided under Section 4.04 a. 4. above.
4.05 Member Voting: Standard Quorum and Vote Required.
a. With Respect to Matters Pertaining to Only the
Project and/or Association Personal Property. With respect to
matters pertaining to only the Project and/or Association Personal
Property, the standard quorum and vote requirements are as follows:
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(August 31, 1998) 46
1. Where Class "C" Membership Has Not Yet
Converted to Class "A" and/or Class "B" Membership. Where Class "C"
Membership has not yet been converted to Class "A" and/or Class "BH
Membership pursuant to Section 4.04 a. 3. above, the presence,
either in person or by proxy (or a combination thereof) at any
meeting of Members of: (1) the Declarant, (2) Members entitled to
cast at least 15 percent of the total votes held by all Members in
the Association, excluding votes held by Declarant with respect to
Declarant Vacation Ownerships, and (3) Owner(s) of at least eight
(8) Facilities/Amenities Condominiums, shall constitute a quorum
for any action before the Association, unless a greater requirement
is otherwise imposed by this Declaration, the Bylaws, or the
Articles; and the vote or written ballot cast in favor of, or
against, the issue of Association business in question, as the case
may be, at such meeting of: (i) the Declarant, (ii) Members holding
at least a majority of the Class "A" and Class "B" Memberships, and
(iii) the Owner(s) of at least eight (8) Facilities/Amenities
Condominium, then present, in person and/or by proxy, shall
constitute approval or disapproval, as the case may be, of the
proposal or matter at issue, except where a greater portion of the
voting power is otherwise required by this Declaration, the Bylaws,
or the Articles.
2. Where Class "C" Membership Has Been Converted
to Class "A" and/or Class "B" Membership. Where Class "C"
Membership has been converted to Class "A" and/or Class "B"
Membership pursuant to Section 4.04 a. 3. above, the presence,
either in person or by proxy (or a combination thereof) at any
meeting of Members of: (1) Members entitled to cast at least 15
percent of the total votes held by all Members in the Association,
(2) Members entitled to cast at least 15 percent of the total votes
held by all Members in the Association, excluding votes held by
Declarant with respect to Declarant Vacation Ownerships, and (3)
the Owner(s) of at least eight (8) Facilities/Amenities
Condominiums, shall constitute a cruorum for any action before the
Association, unless a greater requirement is otherwise imposed by
this Declaration, the Bylaws, or the Articles; and the vote or
written ballot cast in favor of, or against, the issue of
Association business in question, as the case may be, at such
meeting of: (i) Members holding at least a majority of the total
votes in the Association, (ii) Members holding at least a majority
of the total votes in the Association, excluding votes held by
Declarant with respect to Declarant Vacation Ownerships, and (iii)
the Owner(s) of at least eight (8) Facilities/Amenities
Condominiums, then present, in person or by proxy, shall constitute
approval or disapproval, as the case may be, of the proposal or
matter at issue, except where a greater portion of the voting power
is otherwise required by this Declaration, the Bylaws, or the
Articles.
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(August 31, 1998) 47
b. With Respect to Matters Pertaining to Only the
Vacation Ownership Operation. With respect to matters pertaining to
only the Vacation Ownership Operation, the standard quorum and vote
requirements are as follows (Note: the Class "D" Members, namely
the Owner(s) of the Facilities/Amenities Condominiums, do not have
any vote or even Membership with respect to these matters.):
1. Where Class "f." Membership Has Not Yet Been
Converted to Class "A" and/or Class "B" Membership. Where Class "C"
Membership has not yet been converted to Class "A" and/or Class "B"
Membership pursuant to Section 4.04 a. 3. above, the presence,
either in person or by proxy (or a combination thereof) at any
meeting of Members of: (1) the Declarant, and (2) Members entitled
to cast at least 15 percent of the total votes held by all Members
in the Association, excluding votes held by Declarant with respect
to Declarant Vacation Ownerships, shall constitute a quorum for any
action before the Association, unless a different requirement is
imposed by this Declaration, the Bylaws, or the Articles; and the
vote or written ballot cast in favor of, or against, the issue of
Association business in question, as the case may be, at such
meeting: (i) the Declarant, and (ii) Members holding at least a
majority of the Class "A" and Class "B" votes, then present, in
person and/or by proxy, shall constitute approval or disapproval.
as the case may be, of the proposal or matter at issue, except
where a greater portion of the voting power is required by this
Declaration, the Bylaws, or the Articles.
2. Where Class "C" Membership Has Been Converted
to Class "A" and/or Class "B" Membership. Where Class "C"
Membership has been converted to Class "A" and/or Class "B"
Membership pursuant to Section 4.04 a. 3. above, the presence,
either in person or by proxy (or a combination thereof) at any
meeting of Members of: (1) Members entitled to cast at least 15
percent of the total votes held by all Members in the Association,
and (2) Members entitled to cast at least 15 percent of the total
votes held by all Members in the Association, excluding votes held
by Declarant with respect to Declarant Vacation Ownerships, shall
constitute a quorum for any action before the Association, unless
a different requirement is imposed by this Declaration, the Bylaws,
or the Articles; and the vote or written ballot cast in favor of,
or against, the issue of Association business in question, as the
case may be, at such meeting of: (i) Members holding at least a
majority of the total votes in the Association, and (ii) Members
holding at least a majority of the total votes in the Association,
excluding votes held by Declarant with respect to Declarant
Vacation Ownerships, then present, in person or by proxy, shall
constitute approval or disapproval. as the case amy be, of the
proposal or matter at issue, except where a greater portion of the
voting power is required by the Bylaws, the Articles or this
Declaration.
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(August 31, 1998) 48
c. Each Member to Vote. Each Member shall make his,
her, their or its best efforts, whether in person or by proxy, to
attend each Association Member meeting and to vote on each
Association matter of business.
4.06 Procedural Rules. Procedural rules relating to Member
meetings, Member voting, nomination and election of directors to
the Board, Board meetings, director voting, officers, and
committees, are set forth in the Bylaws.
ARTICLE 5
ASSOCIATION'S RIGHTS. POWERS, AND DUTIES;
AMD MANAGING AGENT
5.01 General Rights. Powers, and Duties.
a. Administration and Services. Administration, man-
agement, and control of the Project, Association Personal Property,
and the Vacation Ownership Operation shall be, and is, vested in
the Association for the benefit and on behalf of the Condominium
Interest Owners. In this connection, the Association, acting alone
and/or through its Board, its officers, and/or its other duly
authorized representatives, shall, subject to the provisions of the
Articles, the Bylaws and this Declaration, exercise all of the
powers, rights, and duties herein enumerated, and, except as may be
specifically limited herein, all the rights, powers, and duties
held by a nonprofit, mutual benefit corporation organized under the
laws of the State of California. These rights, powers, and duties
of the Association shall, reciprocally, constitute the services to
be given by the Association to the Condominium Interest Owners.
b. Conveyance of Association Property to Association.
The Declarant shall convey and transfer to the Association all
Association Real Property, Association Personal Property, and
Common Furnishings located within the particular Phase of the Land
in which the Declarant has constructed Improvements and in which
the Declarant will offer for sale, and sell, Vacation Ownerships,
at or prior to the recordation of the Original Deed evidencing the
initial completed sale and conveyance of a Vacation Ownership in
such Phase.
c. Power of the Board of Directors. The Association
shall, as a general principle, act through its Board; and the Board
shall have the right, power, and duty to act for the Association
except as to those actions which require the vote of the Members of
the Association.
d. Vesting of Rights. Powers, and Duties. The powers,
rights, duties, and limitations of the Association set forth in
this Article 5 and elsewhere in this Declaration, and in the
gra11-03\docs\ccrs.01
(August 31, 1998) 49
Articles and the Bylaws shall vest in and be imposed on the
Association concurrently with recordation of the Original Deed
evidencing the initial completed sale and conveyance by Declarant
of a Vacation Ownership in the Project.
5.02 Specific Rights. Powers, and Duties of the Association
and Services to the Owners. Without limiting the foregoing general
rights, powers, and duties, or of any Association rights, powers,
and duties provided elsewhere in this Declaration, or in the
Articles or Bylaws, the Association, for the benefit of the
Condominium Interest Owners, is hereby expressly authorized and
directed to do all of the following, which shall, reciprocally,
constitute the services to be rendered by the Association to all
Condominium Interest Owners:
a. Delegate Authority. To elect, employ, appoint,
assign, and delegate the powers rights, and duties of the Associa-
tion to officers, employees, committees, agents, and independent
contractors including, without limitation, the Managing Agent;
provided, however, that no such delegation shall relieve the Asso-
ciation of any ultimate responsibility it may have to perform any
such delegated duty.
b. Enter Contracts. To enter contracts with third
parties for the furnishing of goods or services related to the
Project, Association Personal Property, and/or the Vacation Owner-
ship Operation.
c. Borrow Money. To borrow money as may be needed in
connection with the discharge by the Association of its powers,
rights, and duties.
d. Establish Rules and Regulations. To adopt reason-
able Rules and Regulations not inconsistent with this Declaration,
the Articles, or the Bylaws relating to the occupancy and/or use by
the Condominium Interest Owners and their Permitted Users of the
Project, the Association Personal Property, and the Common Furni-
shings. A copy of the Rules and Regulations shall be mailed or
otherwise delivered to each Owner. Declarant may establish and
adopt such Rules and Regulations until the initial Board is
selected. Thereafter, the Board shall have this responsibility.
e. Right to Enter. To: (i) enter at any time upon any
portion of the Association Real Property and the Common Area; (ii)
enter any Vacation Unit or Facilities/Amenities Unit, after giving
reasonable notice to the Owner(s) or other occupants thereof, where
the Unit is then being personally occupied, for any purpose
reasonably related to the exercise by the Association of its rights
or performance of its duties under this Declaration; and (iii)
enter any Vacation Unit or Facilities/Amenities Unit at any time
without having to give prior notice, in order to abate any nuisance
gral1-03\docs\ccrs.01
(August 31, 1998) 50
or any suspected dangerous, unauthorized, prohibited, or unlawful
activity being conducted or maintained therein, or to assist in the
event of any emergency involving illness or existing or potential
danger to life or property. Any such right of entry shall be
exercised in such a manner as to avoid any unreasonable or
unnecessary interference with the use and occupancy of any Unit
thereby affected.
f• Maintain and Repair Association Property. Com-mnn
Area and Common Furnishings. To maintain, repair, keep clean,
repaint or otherwise refinish or redecorate, and replace and/or
restore, as may be necessary or desirable, all Association Real
Property, all Association Personal Property, and all Common Area,
and any portion thereof, to the standard that all such Association
Property, Common Area, and Common Furnishings are at all times kept
in clean, sanitary, workable, attractive, and "first-class"
condition, so that the appearance and value of such Association
Property, Common Area, Common Furnishings, and the Project as a
whole, are preserved.
g. Pay Taxes and Assessments. As agent of the
Condominium Interest Owners and not as principal, to pay all taxes
and assessments, real or personal, relating to the Condominium
Interests, the Association Real Property, the Common Area, the
Association Personal Property, and/or the Common Furnishings, to
the extent that such taxes are not separately assessed and billed
to such Owners, and to contest or compromise same provided they are
paid or a bond insuring payment is posted before the sale or the
disposition of any property to satisfy the payment of such taxes.
Until such time as (if ever) these taxes have not been separately
assessed to each Owner, the moneys required to pay these taxes
shall be a Basic Expense of the Association to be paid for from
moneys raised by the levy of Regular Annual Assessments.
h. Provide and Pay for Utilities. To acquire, provide,
and pay for water, sewer, garbage disposal, refuse and rubbish
collection, electrical, telephone, gas, and other utility services
furnished to the Condominium Units, to the extent that the costs of
such utilities are not separately billed to the Owners. The moneys
required to pay for these utility services shall be a Basic Expense
of the Association to be paid from moneys raised by the levy of
Regular Annual Assessments.
i. Enforce Declaration. Bylaws, and Rules and Regula-
tions. To take all measures necessary to enforce the provisions of
this Declaration, the Bylaws, and the Association Rules and
Regulations. The Owner(s) of the Facilities/Amenities Condominiums
shall be responsible for enforcing any Facilities/Amenities Condo-
miniums Owner(s) Rules and Regulations.
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(August 31, 1998) 51
j. Levy and Collect Assessments. Pav Expenses, and
Change Fiscal Year. To levy, bill, collect, and enforce payment of
Assessments against all Owners for the purposes and in the manner
provided in Article 6 hereof, and to pay all Basic Expenses and
Special Expenses of the Association.
k. Obtain and Pay Cost of Legal and Accounting Ser-
vices . To obtain and pay the cost of legal and accounting services
deemed necessary or proper in connection with the administration,
management, and operation of the Project, Association Personal
Property, and the Vacation Ownership Operation, and in the
performance of any other duties hereunder including enforcement of
this Declaration, the Articles, the Bylaws, and/or the Rules and
Regulations. In this connection, the Association is hereby granted
the express authority to select legal counsel to represent the
Association and the Owners collectively in Association legal
matters, unless an Owner desires to retain his, her, or its own
separate legal counsel at such Owner's own expense.
1. Obtain and Pav Cost of Insurance. To obtain,
maintain, and pay the cost of the insurance policies required by
this Declaration or as otherwise desired by the Association.
m. Maintain Bank Accounts. To deposit: (i) all funds
collected from the Assessments levied against Owners pursuant to
Article 6 hereof, and (ii) all other amounts collected by the
Association in connection with its rights, powers, and duties
provided herein, as follows:
1. To deposit all Regular Annual Assessments,
Special Assessments, Capital Needs Assessments, and any other
income of the Association into a separate federally-insured,
readily accessible, institutional money depository account or
accounts (called the "General Account or Accounts") selected by the
Board. Funds deposited in the General Account(s) may be used by the
Association only for the purposes for which such funds have been
collected.
2. To redeposit that portion of any Regular Annual
Assessments, which the Association shall collect for reserves,
within 30 days after their initial deposit into the General
Account, into a federally-insured, institutional money depository
account as the Board selects, taking into consideration when use of
such funds is anticipated (called the "Reserve Account").
n. Prepare and Distribute Financial Information. To
regularly prepare Association budgets and financial statements and
to distribute copies thereof to each Member as follows:
1. Prepare Budget. To prepare and adopt for each
forthcoming Fiscal Year a pro forma Budget of the revenue and Basic
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(August 31. 1998) 52
Expenses which the Board expects will be collected/incurred by the
Association in connection with the Association's administering and
managing the Project, Association Personal Property, and the
Vacation Ownership Operation in such forthcoming Fiscal Year. Each
such Budget shall be prepared by, or under the direction of, the
Board, and a copy thereof shall be distributed to each Owner during
the then ending Fiscal Year not more than 60 days nor less than 45
days, prior to the beginning of the forthcoming Fiscal Year to
which the Budget applies. Each such Budget shall consist of at
least the following information: (i) the estimated revenue and
Basic Expenses determined on an accrual accounting basis; (ii) the
amount of the total cash reserves of the Association currently
available for replacement or major repair of Association Property
and Common Furnishings and for contingencies; (iii) an itemized
estimate of the remaining life of, and the methods of funding to
defray the costs of repair, replacement or additions to Association
Property and Common Furnishings; and (iv) a general statement
setting forth the procedures used by the Board in the calculation
and establishment of reserves to defray the costs of repair,
replacement or additions to such Association Property and Common
Furnishings.
2. Prepare Annual Report. To prepare and dis-
tribute to each Condominium Interest Owner (including each director
on the Board) an annual report within 120 days after the close of
each Fiscal Year, consisting of the following: (i) a balance sheet
of the Association as of the last day of such Fiscal Year; (ii) an
operating (income) statement showing the financial results of the
operations of the Association for such Fiscal Year; (iii) a
statement of net changes in the financial position and operations
of the Association for such Fiscal Year; (iv) for any Fiscal Year
in which the gross income to the Association exceeds $75,000, a
copy of the review or certified audit, to be determined by the
Board, of the annual report referred to herein prepared in
accordance with generally accepted accounting principles by a
licensee of the California State Board of Accountancy; and (v) a
list of the names, business mailing addresses, and business,
telephone numbers of the directors on the Board. If such annual
report is not prepared by an independent accountant, the annual
report shall be prepared by an officer or the Managing Agent of the
Association and shall be accompanied by the certificate of such
officer or Managing Agent certifying that the statement was
prepared from the books and records of the Association without
independent audit or review.
o. Provide Minutes and Agenda. To provide each
Condominium Interest Owner with: (i) a copy of the minutes of any
Association or Board meeting, within 60 days following the date of
such meeting, and (ii) a list of the items of business and the
order in which they are to be considered, at each annual or special
meeting of the Members of the Association not later than 30 days
gra11-03\docs\ccrs.01
(August 31, 1998) 53
nor earlier than 90 days prior to the scheduled date of such
meeting, which list shall also contain the name, address, and a
brief biographical sketch of each person nominated to stand, or
person who has announced his intention to stand, for election to
the Board. Mailing of the information referred to in Section 5.02
n. above, and this Section 5.02 o. and Section 5.02 p. below, may
be combined where appropriate.
p. Prepare Statement of Assessment Enforcement Policy.
To prepare and distribute to each Owner annually, within 60 days
prior to the beginning of each Fiscal year, a statement of the
Association's policies and practices in enforcing its remedies
against Condominium Interest Owners for their defaults in the
payment of Regular Annual Assessments, Special Assessments, and
Capital Needs Assessments including the recording and foreclosing
of Liens (referred to in Subsection 7.02 c.) against such Owners'
Condominium Interests in the Project.
q. Issue Statements of Status. Upon the request of any
Owner, Mortgagee, prospective Mortgagee, purchaser, or other
prospective transferee of a Condominium Interest, to issue a
written statement setting forth any amounts unpaid to the
Association with respect to the Condominium Interest in question
(called a "Statement of Status"). Such Statement of Status for
which a reasonable fee may be charged, shall be binding upon the
Association in favor of any person who may rely thereon in good
faith. In addition, the Association shall cause its insurer(s)
under this fire and extended coverage insurance policy to provide
to any Mortgagee with a Certificate of Insurance indicating that
such Mortgagee is an additional insured under such policy or
policies.
r. Compile Register. To compile and keep current an
accurate list of all Association Members (the "Register") which
Register shall set forth the name, mailing address, and telephone
number of each Member. Upon the written request by a Member, this
Register shall be made available for inspection and copying by such
Member - or by his, her, or its duly appointed representative - at
any reasonable time at the office of the Managing Agent upon the
Project for a purpose reasonably related to Membership in the
Association, all in accordance with the applicable provisions of
the Bylaws. Each Member who inspects the Register hereby agrees
that he, she, or it will not make any commercial use of same, will
not use same for any purpose not directly related to Association
business, and will not distribute a copy of the Register to any
person who is not a Member.
s. Do Other Necessary or Proper Acts. To do all other
things or acts which in the discretion of the Association are
deemed necessary, desirable, helpful, and/or proper in connection
with the administration and management of the Project, Association
gra11-03\docs\ccrs.01
(August 31, 1998) 54
Personal Property, and the Vacation Ownership Operation, including,
without limitation, initiating legal actions in the name of the
Association on behalf of the Owners.
5.03 Right. Power, and Duty to Engage Managing Agent. The
Association shall have the authority and duty to employ a reputable
firm or proprietorship to be the Managing Agent for the Project,
Association Personal Property, and the Vacation Ownership Operation
pursuant to a written agreement (the "Management Agreement") , which
Agreement shall meet the basic requirements of this Section 5.03.
The first Managing Agent shall be appointed by Declarant. Each
Management Agreement shall cover at least the following matters:
a. Delegation of Authority. Delegate to, authorize and
obligate the Managing Agent to perform all of the duties and
obligations of the Association specified in Section 5.02 above,
subject to the limitations set forth in Subsection 5.03 1. below.
b. Term. Provide for a term of management of not more
than three (3) years, except that the Management Agreement shall
provide that the term will be automatically renewed for successive
one (l)-year terms unless a notice of non-renewal is given by
either party thereunder at least 90 days prior to the end of the
then existing term; provided, however, the Association may not make
a determination not to renew said Management Agreement and give
such notice of non-renewal, unless such action has been directed by
the vote or written consent of: (i) Members holding at least a
majority of the total votes in the Association, excluding votes
held by Declarant with respect to Declarant Vacation Ownerships,
and (ii) the Owner(s) of at least (8) Facilities/Amenities
Condominiums.
c. Termination for Cause. Provide for termination of
the Managing Agent for cause at any time by the Board with pro-
vision for arbitration of the issue of whether "cause" existed in
accordance with the Commercial Arbitration Rules of the American
Arbitration Association, if requested by the Managing Agent.
d. Resignation. Provide that the Managing Agent may
resign; but, only after it has given to the Association at least
90 days prior written notice of such intention to resign.
e. Enumeration of Powers and Duties. Enumerate the
powers and duties of the Managing Agent in the operation of the
Project, Association Personal Property, and Vacation Ownership
Operation including without limitation, administrative, fiscal,
maintenance, and enforcement duties.
f. Compensation. Provide for compensation to be paid
to the Managing Agent not to exceed ten percent of the actual Basic
Expenses of the Association, including reserves, but excluding of
gra11-03\docs\ccrs.01
(August 31, 1998) 55
the fee of the Managing Agent for the Fiscal Year in question.
Such compensation may be increased: (i) if so authorized by the
vote or written consent of at least that number of Members' votes
required by Section 4.05 a. above to approve a proposal, or (ii) by
the Board, if the Association is unable to procure a reputable
person or firm to act as Managing Agent without in-creasing such
compensation. All overhead expenses of the Managing Agent
attributable to its management of the Project, Association Personal
Property, and the Vacation Ownership Operation shall be passed
through to the Association and the Association shall re-imburse the
Managing Agent for such overhead expenses.
g. Record Maintenance. Provide what Association,
Project, Vacation Ownership Operation, and/or other records are to
be maintained by the Managing Agent.
h. Reports. Provide what periodic reports and other
information relating to the Project, Association Personal Property,
and the Vacation Ownership Operation are to be communicated to the
Association by the Managing Agent.
i. Fidelity Bonding. Provide that Association shall
cause the Managing Agent, and any of its employees who have charge
of Association funds, to be fidelity bonded, at Association cost,
if available, in accordance with Section 8.01 c. below.
j. Errors and Omissions Insurance. Provide that the
Managing Agent shall purchase and maintain, at its own cost, a
policy of insurance, naming the Association as an insured, which
policy provides for payment for damage to third parties arising out
of any errors or omissions to act by the Managing Agent.
k. Right of Entry. Delineate the authority of the
Managing Agent and persons authorized by the Managing Agent to
enter into the Condominium Units for the purposes set forth in
Section 5.02 e. above.
1. Employment of Subagents. Grant authority to the
Managing Agent to employ one or more subagents to assist Managing
Agent perform its duties hereunder.
Program. Provide that the Managing Agent shall administer the
Vacation Ownership Use Program, including without limitation, the
exchange of occupancy rights by Vacation Ownership Owners under an
Exchange Program.
n. Limitation on Powers of the Managing Agent.
Notwithstanding the powers of the Managing Agent set forth in this
Section 5.03, each Management Agreement shall provide that the
Managing Agent shall not enter into any contract with a third
gra11-03\docs\ccrs.01
(August 31, 1998) 56
person or entity whereby such person or entity will furnish goods
or services to the Project, Association Personal Property, and/or
the Vacation Ownership Operation for a term longer than one (1)
year, unless so authorized by the vote or written consent of at
least that number of Members' votes required by Section 4.05 a.
above to approve a proposal, or unless the contract is terminable
by any party thereto at the end of any one (1) year period, except
for:
1. The Management Agreement itself;
2. A contract with a public utility company, if
the rates charged for the materials or services are regulated by
the Public Utilities Commission; provided, however, that the term
of the contract shall not exceed the shortest term for which the
supplier will contract at the regulated rate;
3. Prepaid casualty and/or liability insurance
policies not to exceed three (3) years' duration, provided that the
policy permits short-rate cancellation by the insured;
4. Any lease of Common Furnishings or any laundry
room fixtures and equipment (where such is Association Personal
Property), not to exceed five (5) years' duration, provided that
the lessor under any such agreement is not an entity in which the
Declarant or the Managing Agent has a direct or indirect ownership
interest of 10 percent or more; and
5. Any agreements for cable television services
and equipment, and/or for satellite dish equipment and service, not
to exceed five (5) years' duration, provided that the supplier is
not an entity in which the Declarant or the Managing Agent has a
direct or indirect ownership interest of 10 percent or more; and
6. Any agreements for burglar alarm services and
equipment, not to exceed five (5) years' duration, provided that
the supplier is not an entity in which the Declarant or the
Managing Agent has a direct or indirect ownership interest of 10
percent or more.
5.04 Limited Liability. Neither the Association nor the
Managing Agent, nor any of their sub-agents or employees, shall be
responsible for the acts, omissions to act, or conduct of any of
the Condominium Interest Owners or for the breach of any obligation
by such an Owner arising under this Declaration, the Bylaws, and/or
the Rules and Regulations.
gra11-03\docs\ccrs.01
(August 31, 1998) 57
ARTICLE 6
ASSESS!
6.01 Creation of Personal Obligations; Purpose of Assessments;
Theory and Basis for Allocation of Association Expenses an4
Assessments; and Apportionment of Assessments Among Vacation
Ownership Owners.
a. Creation of Personal Obligations. Declarant, for
each Vacation Ownership it owns, and for each Facilities/Amenities
Condominium it owns, hereby covenants, and each other Vacation
Ownership Owner, and each other Facilities/Amenities Condominium
Owner, if any, by accepting the conveyance of such a Condominium
Interest, whether or not it shall be so expressed in such Owner's
deed, and/or a by owning a Condominium Interest, shall be deemed to
have covenanted and agreed, that, for each such Facilities/
Amenities Condominium and for each such Vacation Ownership owned,
to pay to the Association all Regular Annual Assessments, Special
Assessments and Capital Needs Assessments as these terms are
hereinafter defined and described in Sections 6.02, 6.03, and 6.04,
respectively (all of which are collectively referred to as the
"Assessments") allocated respectively among them by the Board in
accordance with Section 2.07 above, and levied upon them by the
Board, which Assessments shall be established, made, and collected
as hereinafter provided. These Assessments, together with interest
thereon and all costs of collection, including reasonable
attorneys' fees, shall be the personal obligation of each Owner at
the time the Assessment becomes due and payable. This personal
obligation for delinquent Assessments shall not pass to successors-
in-title of a Condominium Interest unless expressly assumed by
them. In addition, pursuant to Section 7.02 c. below, a continuing
lien (called the "Lien") is created in favor of the Association
against each Condominium Interest to secure its Owner's or Owners'
prompt payment to the Association of each such Assessment. No
Owner may waive or otherwise avoid liability for the Assessments by
nonuse of a Condominium Unit or of any other rights given to such
Owner by virtue of such Owner's deed or other conveyance instrument
of a Condominium Interest. Notwithstanding anything in the
foregoing to the contrary, Declarant may, in lieu of paying certain
Regular Annual Assessments and Special Assessments, enter into a
subsidy agreement with the Association with respect to paying
certain Basic Expenses and Special Expenses of the Association.
b. Purpose of Assessments. The purpose of the Assess-
ments is to provide the Association with a vehicle for raising and
paying all Basic Expenses and Special Expenses of the Association.
All assessments shall be used exclusively to promote the health,
safety, welfare and recreation of all Condominium Interest Owners.
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(August 31. 1998} 58
c. Theory and Basis for Allocation of Association
Expenses and Assessments. The Association shall have the duty to
pay for any and all Basic Expenses and Special Expenses incurred by
it. In turn, the Condominium Owners Association shall raise the
moneys required to pay these Expenses from the Assessments it
levies and collects from either: (i) all Condominium Interest
Owners (that is, from both the Vacation Ownership Owners and the
Facilities/Amenities Condominiums Owner(s)), as a whole, where such
expenses pertain to only the Project and/or to the Association
Personal Property, or (ii) all Vacation Ownership Owners where such
expenses pertain to only the Vacation Ownership Operation, which-
ever may be the case. Section 2.07 of this Declaration states the
basis for how the Board is to allocate these Basic and Special
Expenses, and their corresponding Assessments, by expense type
(that is, as a "Project Basic Expense," "Project Special Expense,"
"Sole Basic Expense," or "Sole Special Expense," between the
Vacation Ownership Owners and the Facilities/Amenities Condominium
Owners).
d. Apportionment of Assessments Among Vacation Owner-
ship Owners. All Assessments hereunder levied against Vacation
Ownership Owners shall be levied against each such Vacation
Ownership Owner (including Declarant as to each Declarant Vacation
Ownership), proportionally, based on: (i) the Assigned Vacation
Unit Type owned ("A" Unit Type, "B" Unit Type, "C" Unit Type, and
"E" Unit Type) and (ii) the type of Vacation Ownership owned
(Annual or Biennial), except in those certain instances where such
Assessments are to be levied only against certain, and not all,
Owners; namely, where Special Assessments are levied against Non-
Complying Owner(s) or against Responsible Owner(s) as those terms
are used in Section 6.03 below, and where Capital Needs Assessments
are levied against Predominantly Benefitted Owner(s) as that term
is used in Section 6.04 below. The Board shall establish a
formula, which may be modified from time to time, for the
calculation of an equitable apportionment of Assessments in
accordance with operational and maintenance costs attributable to
each respective Vacation Unit Type. Such proportional assessments
based on Vacation Unit Type shall be levied against Owners of each
respective Assigned Vacation Unit Type in the ratio that the number
of Use Weeks of that particular Assigned Vacation Unit Type to
which each Owner is entitled during any two (2) consecutive Use
Years bears to the total number of Use Weeks of that particular
Assigned Vacation Unit Type constituting such two (2) consecutive
Use Years. In other words, the general rule is that all Owners of
a respective Assigned Vacation Unit Type are to be proportionally
assessed, so that each Owner of an Assigned Vacation Unit of that
particular Assigned Vacation Unit Type shall be assessed the amount
of one full assessment share for each Annual Ownership of that
particular Assigned Vacation Unit Type owned by such Owner and one-
half the amount of one full assessment share for each Biennial
Ownership of that particular Assigned Vacation Unit Type owned by
gra11-03\docs\ccrs.01
(August 31, 1998) 59
such Owner. Notwithstanding anything to the contrary contained in
the foregoing, the general rule of proportionality of assessments
shall not be applicable where there are special circumstances which
would make it unfair for Owners to pay such proportional
Assessment. These special circumstances are discussed under
"Special Assessments" in Section 6.03 below.
6.02 Regular Annual Assessments.
a. Purpose of Regular Annual Assessments. Regular
Annual Assessments shall be assessed against either all Condominium
Interest Owners, or only all Vacation Ownership Owners, as the case
may be, in accordance with Section 6.01 c. above, to provide the
Association with the moneys necessary to pay for the Basic Expenses
of the Association projected in the Budget for said Fiscal Year.
b. Preparation and Adoption of Final Budget and
Determination of Aggregate Regular Annual Assessments Determina-
tion. Not more than 60 days, nor less than 45 days, before the
beginning of each Fiscal Year, the Board, in accordance with
Section 5.02 o. 1. above, shall prepare and adopt the Budget for
such forthcoming Fiscal Year. Subject to the limitations imposed
in Section 6.02 g. below, the Board shall then levy Regular Annual
Assessments for such forthcoming Fiscal Year against the respective
Condominium Interest Owners in the aggregate amount of said adopted
Budget.
c. Allocation and Levy of Regular Annual Assessments
among Owners. The Board shall levy and assess the aggregate
Regular Annual Assessments as above determined, against either all
Condominium Interest Owners, including Declarant as to Declarant
Condominium Interest, or against only all Vacation Ownership
Owners, including Declarant as to Declarant Vacation Ownerships, as
the case may be, in accordance with Section 6.01 c. above.
Notwithstanding anything to the contrary hereinabove contained, for
any Fiscal Year in which there is in effect a subsidy agreement
between Declarant and the Association whereby Declarant agrees to
pay to the Association certain Basic Expenses in lieu of Regular
Assessments for such Fiscal Year, Declarant's obligation to pay
such Regular Assessments for Declarant Condominium Interests for
such Fiscal Year shall be deemed discharged, for so long as there
is no default under the terms of such subsidy agreement.
d. Notice of Assessment. Due Datefs). Delinquency
Datefs), and Method of Payment. Upon the Board's determining the
amount of, and levying, the aggregate Regular Annual Assessments
for a particular new Fiscal Year, the Board shall send to each
Condominium Interest Owner or each Vacation Ownership Owner, as the
case may be, a written notice of assessment with a date thereon,
providing therein: (i) the total amount of each such Owner's
respective portion of such aggregate Regular Annual Assessments;
gra11-03\docs\ccrs.01
(August 31, 1998) 60
(ii) whether such Assessment may be paid in installments, and if
so, the required amount of each such installment, and the months in
which such installments are to be paid; (iii) that each such
Assessment (or first installment thereof, if applicable) shall be
due and payable within 10 days of the date of such written notice;
and (iv) if such Assessment may be paid in installments, that each
additional installment shall be due and payable in the month due
within 10 days of that date of the month specified on such notice
of assessment. Any Regular Annual Assessment (or installment
thereof) not paid within 10 days after the due date specified in
the notice shall bear interest from said due date until paid at the
rate then established by the Board to be charged on delinquent
Assessments and other delinquent charges (called the "Board
Interest Rate"). Each such Regular Annual Assessment shall be
payable in one (1) lump sum, unless the Board elects to receive
installments payable not more frequently than once each month.
e. Commencement of Accrual of Regular Annual Assess-
ments . Regular Annual Assessments against the respective
Condominium Interest Owners (including Vacation Ownership Owners)
shall commence accruing and shall be payable in advance (whether
the entire Annual Assessment or an installment thereof, as the
Board decides) on the Commencement Date as defined below. The
"Commencement" Date shall be the first day of the first month
following the date of the initial close of an escrow of a sale by
Declarant of a Vacation Ownership in the Project. Notwithstanding
anything in the foregoing to the contrary, no Regular Annual
Assessment shall be assessed against an Owner whose escrow for the
purchase of a Vacation Ownership has just closed, where such Owner
will not be entitled to occupy a Unit, by virtue of such Owner's
deed, until the Fiscal Year following the year in which such escrow
was closed.
f. Excess Collections. Should the amount of Regular
Annual Assessments levied and collected for a Fiscal Year be in
excess of the amount required to meet the actual Basic Expenses
which were incurred for such Fiscal Year, such excess shall be
applied by the Association to reduce the amount of the Regular
Annual Assessments levied for the subsequent Fiscal Year or Years,
or, if the Board should determine, be applied to Association
reserves. No Owner shall, by reason of such reduction, be entitled
to a refund by the Association of all or any portion of any Regular
Annual Assessment such Owner had previously paid; nor shall such
Owner thereby be relieved from any obligation to pay any past due
Regular Annual Assessment.
g. Monetary Limitations on Regular Annual Assessments.
For each new Fiscal Year, the Board may levy without requiring the
vote or written consent of the applicable Condominium Interest
Owners, aggregate Regular Annual Assessments which are as much as
20 percent greater than the aggregate Regular Annual Assessments
gra11-03\docs\ccrs.01
(August 31, 1998) 61
for the immediately preceding Fiscal Year. Aggregate Regular
Annual Assessments for a forthcoming Fiscal Year which are more
than 20 percent greater than those for the immediately preceding
Fiscal Year may not be levied without the vote or written consent
of:
1. With Respect to Assessments Pertaining to Only
the Project and/or Association Personal Property; (i) (a) the
Declarant, (b) Members holding at least a majority of the total
votes in the Association, excluding votes held by Declarant with
respect to Declarant Vacation Ownerships, and (c) the Owner(s) of
at least eight (8) Facilities/Amenities Condominium (where Class
"C" Membership has not yet been converted to Class "A" or Class "B"
Membership) ; or (ii) (a) Members holding at least a majority of the
total votes in the Association, (b) Members holding at least a
majority of the total votes in the Association, excluding votes
held by Declarant with respect to Declarant Vacation Ownerships,
and (c) the Owner(s) of at least eight (8) Facilities/Amenities
Condominiums (where Class "C" Membership has been converted to
Class "A" or Class "B" Membership); or
2. With Respect to Assessments Pertaining to Only
the Vacation Ownership Operation; (i) (a) the Declarant, and (b)
Members holding at least a majority of the total votes in the
Association, excluding votes held by Declarant with respect to
Declarant Vacation Ownerships (where Class "C" Membership has not
yet been converted to Class "A" or Class "B" Membership); or (ii)
(a) Members holding at least a majority of the total votes in the
Association, and (b) Members holding at least a majority of the
total votes in the Association, excluding votes held by Declarant
with respect to Declarant Vacation Ownerships (where Class MC"
Membership has been converted to Class "A" or Class "B"
Membership).
Regardless of anything above stated to the contrary, an
increase in the aggregate Regular Annual Assessments for a Fiscal
Year attributable to an increase in real property taxes against any
portion of the Real Property shall be excluded in determining
whether the aggregate Regular Annual Assessments are more than 20
percent greater than the aggregate Regular Annual Assessments for
the preceding Fiscal Year.
6.03 Special Assessments.
a. Purpose. Subject to obtaining any required vote of
the Members provided for in Section 6.03 b. below, the Association
is hereby given the right, power, and duty to levy Special
Assessments against either all Condominium Interest Owners,
including Declarant as to each Declarant Condominium Interest, or
only all Vacation Ownership Owners, including Declarant Vacation
Ownerships, as the case may be, for the purpose of paying Special
gra11-03\docs\cers.01
(August 31, 1998) 62
Expenses of the Association. Such Special Expenses, by way of
example and not by limitation, might include: (i) the incurring of
actual Basic Expenses which are in excess of the Regular Annual
Assessments collected in the Fiscal Year in question; (ii) the
cost to repair, repaint, rebuild, restore and/or replace any of the
Association Property or Common Furnishings, where there are
insufficient reserves for such, or where due to damage or
destruction thereof; (iii) the reimbursement to the Association of
all costs (called "Compliance and Enforcement Costs") incurred by
it in bringing, or attempting to bring, an Owner into compliance
with, or otherwise in attempting to enforce against an Owner
(called a "Non-Complying Owner") the provisions of this
Declaration, the Bylaws, and/or the Rules and Regulations; and (iv)
the reimbursement to the Association of all moneys (called "Lien
Prevention and Removal Costs") paid out in defending against law
suits and paying claims, charges, and liens pursuant to Article 3
hereof to prevent threatened liens, claims, or charges from being
imposed against the Project or any portion thereof, and/or to
remove said liens, claims, or charges once they had become attached
thereto as a result of the acts or omissions to act by the
Responsible Owners; provided. however, while the Association is
not required to levy Special Assessments against all Owners for
reimbursement of Lien Prevention and Removal Costs as provided in
Section 3.04 hereof, the Association shall be required to levy a
Special Assessment for such purpose directly against the
Responsible Owners; and provided, further, the Association shall
be required to levy Special Assessments directly against any Non-
Complying Owners to obtain reimbursement of Compliance and Enforce-
ment Costs in item (iii) above.
b. How Special Assessments Imposed. Except as provided
below, the imposition of Special Assessments against either all
Condominium Interest Owners, or only all Vacation Ownership Owners,
as the case may be, shall require the vote or written consent in
favor of such imposition of the following Members:
1. With Respect to Assessments Pertaining to Only
the Project and/or Association Personal Property: (i) (a) the
Declarant, (b) Members holding at least a majority of the total
votes in the Association, excluding votes held by Declarant with
respect to Declarant Vacation Ownerships, and (c) the Owner(s) of
at least eight (8) Facilities/Amenities Condominiums (where Class
"C" Membership has not yet been converted to Class "A" or Class "B"
Membership); or (ii) (a) Members holding at least a majority of
the total votes in the Association, (b) Members holding at least a
majority of the total votes in the Association, excluding votes
held by Declarant with respect to Declarant Vacation Ownerships,
and (c) the Owner (s) of at least eight (8) Facilities/Amenities
Condominiums (where Class "C" Membership has been converted to
Class "A" or Class "B" Membership); or
gra11-03\docs\ccrs.01
(August 31, 1998) 63
2. With Respect to Assessments Pertaining to Only
the Vacation Ownership Operation: (i) (a) the Declarant, and (b)
Members holding at least a majority of the total votes in the
Association, excluding votes held by Declarant with respect to
Declarant Vacation Ownerships (where Class "C" Membership has not
yet been converted to Class "A" or Class "B" Membership); or (ii)
(a) Members holding at least a majority of the total votes in the
Association, and (b) Members holding at least a majority of the
total votes in the Association, excluding votes held by Declarant
with respect to Declarant Vacation Ownerships (where Class "C"
Membership has been converted to Class "A" or Class "B"
Membership).
3. Exceptions. The Board, however, is hereby
empowered to impose the following types of Special Assessments
without such vote or written assent of the Members:
(1) Special Assessments against either all
Condominium Interest Owners, or only all Vacation Ownership Owners,
as the case may be (other than Special Assessments to raise moneys
for repairing, rebuilding, restoring, and/or replacing all or any
portion of the Project, Association Personal Property, or the
Common Furnishings because of damage or destruction thereto) , where
the total of such Special Assessments levied against all Owners
during any Fiscal Year, together with the total of any Capital
Needs Assessments also levied against all Owners during said Fiscal
Year, does not exceed, in the aggregate, five percent (5%) of the
Basic Expenses in the Budget of the Association for the Fiscal Year
in which such Assessments are levied;
(2) Special Assessments against either all
Condominium Interest Owners, or only Vacation Ownership Owners, as
the case may be, to raise moneys for repairing, rebuilding,
restoring and/or replacing all or any portion of the Project,
Association Personal Property, and/or Common Furnishings, because
of damage or destruction thereto, where the total of such Special
Assessments levied against all such Owners during any Fiscal Year,
together with the total of any Capital Needs Assessments also
levied against all Owners during said Fiscal Year, does not exceed,
in the aggregate, ten percent (10%) of the Basic Expenses in the
Budget of the Association for the Fiscal Year in which such
Assessments are levied; and
(3) Special Assessments against all
Condominium Interest Owners, and/or the Non-Complying Owner or
Responsible Owners for the purpose of reimbursing the Association
for all Compliance and Enforcement Costs or Lien Protection and
Removal Costs, as referred to above.
c. Method of Lew.
gra11-03\docs\ccrs.01
(August 31, 1998) 64
1. Where Levy Is Against All Condomin.'' "in interest
Owners or all Vacation Ownership Owners. Where the Special
Assessments in question are to be levied against either all
Condominium Interest Owners, or only all Vacation Ownership Owners,
as the case may be, they shall be levied upon, allocated between,
and paid by all such Owners, including Declarant as to Declarant
Condominium Interests, or Declaration Vacation Ownerships, in the
same manner as the levy of Regular Annual Assessments, in
accordance with Section 6.02 c. above.
Notwithstanding anything in the foregoing to the contrary,
where the Members determine that the predominant benefit of levying
any such Special Assessment will accrue for only a special group
(or groups) of Owners (for example, certain Vacation Ownership
Owners having the right to occupy Vacation Units of a particular
Unit Type(s), or any Facilities/Amenities Condominium Owner, as to
a particular Facilities/Amenities Condominium) (called here the
"Predominantly Benefitted Owner(s)"), the Members may levy such
Special Assessments therefor against only those Predominately
Benefitted Owners.
Further, notwithstanding anything to the contrary hereinabove
contained, for any Fiscal Year in which there is in effect a
subsidy agreement between Declarant and the Association whereby
Declarant agrees to pay to the Association certain Special Expenses
in lieu of Special Assessments for such Fiscal Year, Declarant's
obligation to pay such Special Assessments for Declarant
Condominium Interests for such Fiscal Year shall be deemed
discharged, for so long as there is no default under the terms of
such subsidy agreement.
2. Where Individual Special Assessment Is In-
volved. A Special Assessment may be levied solely against a Non-
Complying Owner (s) or Responsible Owners (s) as those terms are used
in this Declaration.
d. Notice of Assessment. Due Datefs). Delinquency
Datefs). and Method of Payment. Subject to complying with the
foregoing requirements, the Association may levy Special Assess-
ments at any time. After the date of such levy, the Board shall
send a written notice of assessment, with a date thereon: (a) with
respect to Special Assessments being levied against either all
Condominium Interest Owners or only all Vacation Ownership Owners,
as the case may be, to each such Owner, or (b) with respect to a
Special Assessment being levied against a particular Non-Complying
Owner or Responsible Owner (where such Assessment (s) has been
levied to obtain reimbursement of Compliance and Enforcement Costs
or Lien Prevention or Removal costs from such an Owner (s)) , to such
Owner. Each such notice shall provide therein: (i) the total amount
of each such Owner's respective portion of such aggregate Special
Assessments (if being levied against more than one Owner), or the
gra!1-03\docs\ccrs.01
(August 31, 1998} 65
total amount of the full Special Assessment (if being levied only
against one Owner); (ii) whether such Special Assessment may be
paid in installments, and, if so, the required amount of each such
installment, and the months in which such installments are to be
paid; (iii) that such Special Assessment (or first installment
thereof, if applicable) shall be due and payable within 10 days of
the date of such notice of assessment; and (iv) if such Special
Assessment may be paid in installments, that each additional
installment shall be due and payable in the month due within 10
days of that date of the month specified on such notice of
assessment. Any Special Assessment (or installment thereof, if
applicable) not paid within 10 days after such due date shall be
deemed delinquent and shall bear interest from said due date at the
Board Interest Rate until paid. A Special Assessment shall be
payable in one (1) lump sum, unless the Board elects to receive
periodic installments payable not more frequently than once each
month.
6.04 Capital Needs Assessments.
a. Purpose. Subject to obtaining the required vote of
the Members required by Section 6.04 b. below, the Association is
hereby given the right, power, and duty to levy Capital Needs
Assessments against either all Condominium Interest Owners,
including Declarant, as to Declarant Condominium Interests, or only
all Vacation Ownership Owners, as the case may be, for the purpose
of paying, in whole or in part, Special Expenses representing the
cost of purchasing, restoring, and/or replacing any Association
Property and/or the Common Furnishings, to the extent that the same
is not funded by Regular Annual Assessments or by Special Assess-
ments .
b. How Capital Needs Assessments Imposed. Capital
Needs Assessments against Owners shall require the vote or written
consent of the same number of Members required by Section 6.03 b.
of this Declaration (relating to imposition of Special
Assessments).
c. Method of Lew. The total amount of the Capital
Needs Assessments required shall be levied upon, allocated between,
and paid by either all Owners of Condominium Interests, including
Declarant as to Declarant Condominium Interests, or only all
Vacation Ownership Owners, including Declarant as to Declarant
Vacation Ownerships, as the case may be, in the same manner as the
levy of Regular Annual Assessments in accordance with Section 6.02
c. above.
Notwithstanding anything in the foregoing to the contrary,
where the Members determine that the predominant benefit of levying
any such Capital Needs Assessment will accrue for only a special
group (or groups) of Owners (for example, Vacation Ownership Owners
gra11-03\docs\ccrs.01
(August 31, 1998) 66
having the right to occupy Vacation Units of a particular Unit
Type(s), or any Facilities/Amenities Condominium Owner, as to a
particular Facilities/Amenities Condominium) (called here the
"Predominantly Benefitted Owner(s)"), the Members may levy such
Capital Needs Assessments therefor against only those Predominately
Benefitted Owners.
d. Notice of Assessment. Due Datefs). Delinquency
Date(s). and Method of Payment. Subject to complying with the
foregoing requirements, the Association may levy Capital Needs
Assessments at any time. After the date of such levy, the Board
shall send a written notice of assessment, with a date thereon, a
written notice of assessment, with a date thereon: (a) with respect
to Capital Needs Assessments levied against either all Condominium
Interest Owners, or only all Vacation Ownership Owners, as the case
may be, to each such Owner, or (b) with respect to a Capital Needs
Assessment being levied against a predominantly Benefited Owner (s),
to such Owner. Each such notice shall provide therein: (i) the
total amount of each such Owner's respective portion of such
aggregate Capital Needs Assessments; (ii) whether such Assessment
may be paid in installments, and, if so, the required amount of
each such installment, and the months in which such installments
are to be paid; (iii) that such Assessment (or first installment
thereof, if applicable) shall be due and payable within 10 days of
the date of such notice of assessment; and (iv) if such Assessment
may be paid in installments, that each additional installment shall
be due and payable in the month due within 10 days of that date of
the month specified on such written notice. Any Capital Needs
Assessment (or installment thereof, if applicable) not paid within
10 days after such due date shall be deemed delinquent and shall
bear interest from said due date at the Board Interest Rate until
paid. A Capital Needs Assessment shall be payable in one (1) lump
sum, unless the Board elects to receive periodic installments
payable not more frequently than once each month.
6.05 Personal Charges.
a. Purpose. Personal Charges ("Personal Charges") are
expenses of the Condominium Owners Association (but which are
outside the Budget and, therefore, are not recovered by Regular
Annual Assessments) which are incurred as a direct result of
occupancy of a Condominium Unit by a Condominium Interest Owner
and/or such any such Owner's Permitted User. Such Personal Charges
include any expense resulting from the act or omission to act of
any such Owner or Permitted User, including, without limitation:
(i) the cost of any additional cleaning service, and/or other
special services or supplies attributable to such Owner's or such
Owner's Permitted User's use and/or occupancy of a Condominium
Unit; (ii) the cost to repair any damage to, or restore or replace,
any Association Property or Common Furnishings on account of loss
or damage thereto occurring during such Owner's or such Owner's
gra11-03\docs\ccrs.01
(August 31, 1998) 67
Permitted User's use and/or occupancy thereof, and (iii) the cost
to satisfy any expense paid or incurred by any other Condominium
Interest Owner (s) or by the Association as a result of any
intentional or negligent act or omission to act on the part of such
Owner or such Owner's Permitted User arising during such use or
occupancy of a Unit or resulting from the breach by such Owner or
Permitted User of any provisions of this Declaration, the Bylaws,
and/or the Rules and Regulations during such use or occupancy. For
purposes of this Section 6.05 a., the act or negligence of a
Permitted User shall be deemed to be the act of the Owner
authorizing occupancy of the Condominium Unit in question.
b. Payment and Delinquency.
1. Personal Charges shall be billed by a written
statement and shall be due and payable within 10 days of the date
of such statement, statement is to be so dated.
2. Any Personal Charges not paid within 10 days
after said due date thereof shall be deemed delinquent and shall
bear interest from said due date at the Board Interest Rate until
paid. Personal Charges are payable in one lump sum. Each Personal
Charge, together with interest thereon and all costs of collection
including reasonable attorney's fees, shall be the personal
obligation of the Condominium Interest Owner who incurs such
Personal Charge.
ARTICLE 7
ENFORCEMENT OF RESTRICTIONS
7.01 General Provisions.
a. General Power and Right to Bring Actions. In the
event of failure by a Condominium Interest Owner or such Owner's
Permitted User(s) to comply with any of the provisions of this
Declaration, the By-laws, and/or the Rules and Regulations,
including, without limitation: (i) failure of a Vacation Ownership
Owner or such Owner's Permitted User to vacate an Assigned Vacation
Unit upon expiration of such Owner's Fixed Use Week, (ii) an
Owner's or such Owner's Permitted User's causing damage to, or loss
of, any portion of the Association Property or Common Furnishings,
(iii) an Owner's causing or permitting such Owner's to be subject
to a lien (other than the lien of nondelinquent real property taxes
or other assessments), claim, or charge which could result in the
sale of the Condominium Interests of other Owners, (iv) an Owner's,
by such Owner's act or omission to act, causing a lien, claim or
charge (other than the Lien against said Owner's own Condominium
Interest referred to in Section 7.02 c. below) to be imposed
against any portion of the Project, Association Personal Property
and/or Common Furnishings, (v) an Owner's or such Owner's Permitted
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(August 31, 1998) Do
User's causing a disturbance that interferes with the use and
enjoyment of the Project by any other Owner(s), and/or (vi) the
failure of an Owner to pay any Assessment, personal charge or other
charge levied by the Association hereunder, then, in such event,
the Association and/or any Condominium Interest Owner (s), including
Declarant as to Declarant Condominium Interests, shall have the
right, power, and authority to enforce the noncomplying Owner's
and/or Permitted User's compliance with, or to seek damages for
breach of, this Declaration, the Bylaws, and/or the Rules and
Regulations in any manner provided for by law or equity, including,
without limitation, as may be applicable, the right to enforce the
Declaration, the Bylaws, and/or the Rules and Regulations by
bringing suit to enjoin the violation or specifically enforce the
violated provisions, and the right to bring legal action for
damages.
b. Rights and Remedies Cumulative. All rights and
remedies of the Association and the Owners given under this
Declaration and by law may be used cumulatively, and need not be
used exclusively of each other; and the Association or Owner(s)
shall have the right to pursue any one, or all, of such rights and
remedies so long as any such right or remedy is not prohibited
elsewhere by this Declaration or by law for use against the
violation in question.
c. Association May Delegate. The Association may
delegate to the Managing Agent the power and authority to carry out
all disciplinary actions imposed by the Association or Board under
this Article 7.
d. Limited Forfeiture Rights. Notwithstanding anything
else which may be construed to the contrary in this Declaration,
the Association shall not be empowered to cause the absolute
forfeiture of an Owner's Condominium Interest on account of said
Owner's failure to comply with the provisions of this Declaration
or the Rules and Regulations except pursuant to: (i) the judgment
of a court or the decision of an arbitrator, or (ii) a judicial or
nonjudicial foreclosure of said Owner's Condominium Interest,
because of failure to pay Assessments duly levied by the
Association.
7.02 Certain Specific Enforcement Powers and Rights. In
addition to the general powers and rights to bring actions provided
for in Section 7.01 above, the Association shall have the following
specific powers and rights with respect to the following specific
types of violations of this Declaration, and/or the Rules and
Regulations:
a. Suspension of Rights and Privileges for Failure to
Pay Assessments or Other Charges. If any Owner shall be delinquent
in the payment of any Assessment, Personal Charge, or other charge
gra11-03\docs\ccrs.01
(August 31, 1998) 69
duly levied by the Association, the Association may (but shall not
be required to) suspend the rights and privileges of such Owner:
(i) to use and occupy (both as to such Owner and/or such Owner's
Permitted User) any Vacation Unit or any Facilities/Amenities Unit
(whichever may be applicable) and/or any or all of the Association
Property; (ii) to vote upon any Association matter; and (iii) to
exercise any related rights and privileges appurtenant to being an
Owner, including, without limitation, any exchange rights a
Vacation Ownership Owner may otherwise have. Further, with respect
to such a delinquent Vacation Ownership Owner, the Association
shall give written notice to such Vacation Ownership Owner of any
such suspension of such rights and privileges immediately after
such decision to suspend has been made; the Association shall
further direct that such suspended rights and privileges be
immediately reinstated upon the defaulting Owner's paying to the
Association, in cash or by cashier's or certified check, all such
Assessments or other charges past due as of the date of such
reinstatement; provided, however, that where an Owner whose rights
and privileges have been so suspended due to the failure by such
Owner to pay Assessments or other charges to the Association when
due, does, in fact, pay the Association all such past due
Assessments or other charges, but does not do so until within (1)
48 hours prior to the applicable Check-in Time for such Owner's
contemplated occupancy, or (2) 20 days prior to the applicable
Check-in Time for such Owner's contemplated occupancy/ where such
Owner haying the rights and privileges reinstated had such rights
and privileges suspended for a period of two (2) years or more, the
reinstatement of such Owner's right and privileges shall not be
deemed effective until the next Use Year.
b. Imposition of Monetary Penalty. Suspension of Rights
and Privileges, and/or Taking of Other Disciplinary Action for
Violation of Provisions.
1- General. If any Condominium Interest Owner
shall violate any provision of this Declaration, including, without
limitation, those contained in Section 7.01 a. above, and/or any
provision of the Rules and Regulations, the Association may (but
shall not be required to): (i) impose a monetary penalty upon such
Owner; (ii) suspend the rights and privileges of such Owner and any
otherwise Permitted User to use such Owner's Condominium Unit,
and/or any Common Furnishings; to vote upon any Association matter,
and to exercise any related rights and privileges appurtenant to
being an Owner; and/or (iii) take such other disciplinary action as
the Association may deem appropriate, short of the forfeiture or
sale under power of sale of such Owner's Condominium Interest
(except through the foreclosure of the continuing Lien provided for
in Section 7.02 c. below for failure of an Owner to pay Assessments
levied by the Association); provided, however, that before any or
all of the foregoing three (3) types of disciplinary action may be
taken, the Association must follow the required procedures provided
gra11-03\docs\ccrs.01
(August 31, 1998) 70
for in Section 7.02 b. 2. below.
2. Required Procedures. Except as provided in
Section 7.02 b. 3. below pertaining to failure of an Owner to pay
Assessments levied by the Association, none of the three (3) types
of disciplinary action authorized by Section 7.02 b. 1. above may
be taken until after a meeting of the Board, at which a quorum of
the Board is present, is duly called and held for such purpose in
accordance with the provisions contained in the Bylaws for th-a
noticing, calling, and holding of a meeting of the Board. Written
notice of such meeting shall be given to the alleged breaching
Owner at least 15 days prior to the holding of such meeting. Such
notice shall contain at least the following information: (i) the
date, time, and place of the scheduled meeting; (ii) the alleged
violation of the Owner; (iii) the type of disciplinary action
sought to be imposed against such Owner; (iv) that said Owner has
the right to be present at such Board meeting and present either a
written and/or an oral defense (which type of defense shall be
determined by the Board and specified in the notice) to the
charge(s) made against him and argument as to why the disciplinary
action sought by the Board should not be imposed against him; and
(v) that said Owner may hire at his own expense and be represented
at such meeting by an attorney of his own choice. The scheduled
Board meeting will then be held, and the decision as to whether
such disciplinary action should be taken shall be made by a
majority of the members of the Board present at such meeting. If
the Board determines that the Owner has so violated the provisions
of this Declaration or the Rules and Regulations, the Board shall
give written notice to such breaching Owner of the type or types of
disciplinary action imposed upon such Owner (and if a monetary
penalty, the amount thereof); and such disciplinary action shall
become effective one (1) day after the date of such notice. The
Board shall direct that the suspended rights of any such Owner,
whose rights had been suspended because of the breach, shall be
immediately reinstated upon the breaching Owner's cure of said
breach.
3. Limited Exception When Violation Is for Failure
to Pay Assessment or Other Charges. The disciplinary procedures
set forth in Section 7.02 b. 2. above shall not be required when
the only action sought to be imposed against an Owner is suspension
of his or her rights and privileges as an Owner of a Condominium
Interest (as set forth in Section 7.02 a. above) or the levying of
a uniform late fee, or penalties as a result of said Owner's
failure to pay, when due, any Assessment, or other charge duly
levied by the Association; and the provisions of said Section 7.02
a. above shall apply in such instances.
c. Continuing Lien to Secure Payment of Assessments.
1. Lien Creation. Irrespective and independent of
gral1-03\docs\ccrs.01
(August 31, 1998) 71
any other rights and remedies given to the Association under
Sections 7.02 a. and 7.02 b. above, there is: (i) hereby created
in favor of such Association a continuing lien (called the "Lien"),
with power of sale, on each and every Vacation Ownership to secure
its Owner's or Owners' prompt payment to the Association of each
and every Assessment levied against an Owner pursuant to this
Declaration, together with interest thereon from the due date of
such Assessment until paid at the Board Interest Rate, and all
costs of collection which may have been incurred by the Association
in connection therewith, including reasonable attorneys' fees; and
(ii) hereby granted to the Association the right and power to
enforce each said Lien, pursuant to the provisions set forth herein
for such enforcement. The Lien herein referred to, while it is a
continuing Lien, shall last only for so long as an Owner owns a
Condominium Interest, and shall not be enforceable and shall not be
foreclosed, until recordation of the Notice of Default and Lien
referred to in Section 7.02 c. 2. (b) below.
2. Procedure for Enforcement of Lien.
(a) Optional Demand Notice. At any time
within 30 days after the due date of any Assessment duly levied by
the Association but not paid by an Owner, the Association or its
authorized representative may make and serve by mail upon the
defaulting Owner (but shall not be required to so make and serve)
a written demand (called the "Demand Notice") . Said Demand Notice,
if made, shall be dated and shall contain all of the categories of
information set forth in Section 7.02 c. 2. (b) below. Each
default by an Owner shall constitute a separate basis for such a
demand, but any number of defaults may, at the Association's
election, be included within a single Demand Notice.
(b) Recording of Notice of Default and Lien.
If the Association is not paid (i) within 10 days after mailing any
Demand Notice provided for in Section 7.02 c. 2. (a) above, or (ii)
within 30 days after the due date of the Assessment in question (if
no such Demand Notice has been made), the Association may at any
time thereafter elect to file and record in its favor a Notice of
Default and Lien (with a copy thereof to be delivered to the
defaulting Owner and to the Mortgagee of such defaulting Owner, if
such Mortgagee has requested a copy of same and furnished its name
and address to the Association) against the Condominium Interest of
the defaulting Owner in the Official Records of San Diego County,
California. Such Notice of Default and Lien (or Demand Notice, as
the case may be) shall be executed and acknowledged by any officer
of the Association and shall contain substantially the following
information:
(1) The date of the Notice of Default and
Lien (or Demand Notice, as the case may be);
gra11-03\docs\ccrs.01
(August 31, 1998) 72
in default;
(2) The name of the defaulting Owner;
(3) The amount of the Assessment which is
(4) The amount of interest which has
accrued on such unpaid Assessment;
(5) An itemization and amount of each
collection cost including any attorney's fees;
(6) The total of (3), (4) and (5) above
(called the "Total Monetary Delinquency") which would be required
to cure such default as of the date of such Notice of Default and
Lien (or Demand Notice, as the case may be) , it being realized that
interest shall continue to accrue upon the unpaid Assessment and
that additional costs of enforcement and foreclosure may be
incurred, until the date the unpaid Assessment is actually paid;
(7) That such Notice of Default (or
Demand Notice, as the case may be) and Lien is made by the Associa-
tion pursuant to this Declaration; and
(8) That, in the case of a Notice of
Default and Lien, the Lien may be foreclosed, resulting in the
forfeiture of said defaulting Owner's Vacation Ownership.
(c) Lien Foreclosure. After recordation of a
Notice of Default and Lien, and mailing a copy thereof to the
defaulting Owner, the Lien referred to therein may thereafter be
foreclosed (i) by appropriate foreclosure action in court, or (ii)
in the manner provided by California law for the nonjudicial
foreclosure of a deed of trust by exercise of a power of sale
contained therein, and to that end, the Association is hereby given
such power of sale and conferred with authority to utilize such
power of sale in enforcement of all such Association Liens, or
(iii) in the manner provided by California law for the enforcement
of a judgment. The Association, through its duly authorized
agents, shall have the power to bid in at any such foreclosure
sale, trustee's sale, or judgment sale and to purchase, acquire,
lease, hold, mortgage, and/or convey any Condominium Interest
acquired at such sale, subject to the applicable provisions of this
Declaration. The total amount of (i) the Total Monetary Delinquen-
cy, plus (ii) all interest which has accrued since the date of the
Notice of Default and Lien, plus (iii) all additional costs of
enforcement and foreclosure including, without limitation, trus-
tee's fees, court costs, and title search fees (collectively called
"Subsequent Foreclosure Costs")> shall be secured by such Lien,
and shall be paid to the Association by the defaulting Owner should
he or she desire to cure such default before foreclosure of the
Lien.
gral1-03\docs\ccrs.01
(August 31, 1998) 73
(d) Proceeds from Lien Foreclosure. Should
there be a completed foreclosure of under the Lien with a sale of
the Condominium Interest(s) of the defaulting Owner to a third
party with the result that the Association receives proceeds from
such sale, the Association shall use or pay out these proceeds in
the following order: (i) it shall reimburse itself for its payment
of all Subsequent Foreclosure Costs incurred subsequent to the date
of the Notice of Default and Lien; (ii) it shall pay itself the
amount of the Total Monetary Delinquency stated in the Notice of
Default and Lien; (iii) it shall pay itself all interest which has
accrued on the unpaid Assessment or accruing since the date of the
Notice of Default and Lien to date of foreclosure; (iv) it shall
pay, to the extent proceeds are available, the junior lien hold-
er (s) , if any (in order of their priority), whose lien(s) was
eliminated by foreclosure of the Lien in question; and (v) it
shall pay any balance of said proceeds to the defaulting Owner.
(e) Title of Foreclosure Purchaser. The
purchaser at any such foreclosure sale shall obtain title to the
foreclosed-upon Condominium Interest free from: (i) the amount of
the Total Monetary Delinquency, subsequently accrued interest, and
all Subsequent Foreclosure Costs, and (ii) the effect of any prior
suspension, and the present termination, of the defaulting Owner's
use rights in the Project and his related rights and privileges
appurtenant to having been such an Owner (including, without
limitation, voting rights); and otherwise such purchaser shall be
deemed to be, and shall be, a new Owner of such Condominium
Interest having full use rights in the Project and all privileges
appurtenant to being an Owner, whose title thereto shall be subject
to all the provisions of this Declaration, the Articles, the
Bylaws, and the Rules and Regulations; and in no event shall any
such sale relieve such purchaser from liability for any
Assessments, other payments, or performance thereafter becoming due
under this Declaration, or from the new continuing Lien created
upon such conveyance in favor of the Association. If, upon
foreclosure of the Lien, the Association has still not recovered
all moneys which were due it by the defaulting Owner, any moneys
remaining so unpaid shall, to the extent permitted by law, remain
the obligation of, and shall be payable by, the foreclosed-upon
defaulting Owner; and if such sum should prove uncollectible, the
Board may levy a Special Assessment against all Owners to collect
such sum.
(f) Release of Lien. Upon the defaulting
Owner's paying to the Association the amount of the Total Monetary,
Delinquency, subsequently accrued interest on the unpaid Assessment
and all Subsequent Foreclosure Costs, the Board shall cause to be
recorded a Rescission of the Notice of Default and Lien in question
in the Official Records of San Diego County.
3. Lien Priority and First Mortgages. Any
gral1-03\docs\ccrs.01
(August 31, 1998)74
continuing Lien referred to in Section 7.02 c. hereof shall be
deemed prior and senior to all encumbrances voluntarily made by the
Owner of a Condominium Interest securing such Lien or involuntarily
imposed upon such Condominium Interest by operation of law except
for taxes, bonds, governmental assessments, and any other
governmental levies, which, by law, are deemed prior to such Lien,
and whether or not a Notice of Default and Lien relating to such
Lien has been recorded prior or subsequent to any such encumbran-
ces; provided, however, that such Lien shall also be deemed
subordinate and junior to the lien of any first (in recording
priority) Mortgage created upon the Condominium Interest in
question in good faith and for value and recorded in the office of
the Recorder of San Diego County, California prior to the
recordation of a Notice of Default and Lien thereunder (called here
a "First Mortgage"). The sale or transfer of any Condominium
Interest shall not defeat or affect the Lien provided for herein,
except that a sale or transfer of any such Condominium Interest
which is encumbered by a First Mortgage, which sale or transfer is
made pursuant to a foreclosure or any proceeding in lieu of
foreclosure of such First Mortgage, shall extinguish the Lien
provided for herein as to payments which became due prior to such
sale or transfer. No such sale or transfer, however, shall relieve
the purchaser of such Condominium Interest from liability for any
Assessments thereafter becoming due or from the new continuing Lien
created upon such purchaser's Condominium Interest.
ARTTGT.H a
ASSOCIATION INSURANCE
8.01 Required Policies. The Association shall obtain,
maintain at all times, and pay the cost of, the following insurance
policies:
a. Fire and Extended Coverage on All Condominium Owners
Association Property and Common Furnishings. A policy or policies
insuring all Association Property against loss or damage by fire
and other hazards, including where the coverage is available, and
not cost-prohibitive, earthquake and flood damage coverage, covered
by insurance policies written with extended coverage in an amount
of not less than the full replacement value thereof, which policy
or policies shall name the Association as a coinsured, both for
itself and as agent for each Owner. The Board is appointed
attorney-in-fact by each Owner to negotiate and agree on the value
and extent of any loss under this policy or policies and is granted
full right and authority to compromise and settle any claim or
enforce any claim by legal action or other use and to execute
releases in favor of any insurer with respect to the policy.
b. Liability Insurance. A policy of comprehensive
public liability insurance having a single, combined liability
gra!1-03\docs\ccrs.01
(August 31, 1998) 75
limit of at least $3,000,000, insuring against all liability and
claims for death, personal injury, and property damage relating to
the Condominium Ownership Operation and/or arising out of any and
all ownership, use, rental, occupancy, maintenance, clean-up,
servicing and/or other operation of: (i) the Vacation Condominiums
and the Facilities/Amenities Condominiums, or any portion thereof,
(ii) all Association Property, (iii) the Vacation Ownership
Operation, and (iv) the Facilities/Amenities Condominium Operation.
Said liability insurance shall be in the form of a policy issued to
the Association, and said policy shall name all Condominium
Interest Owners, as a class, and if necessary for coverage, all
agents of the Association, including the Managing Agent, as
additional insureds. Said liability insurance policy shall contain
by the insurer(s) waivers of its right to subrogation under the
policy against any Owner or member of such Owner's household, and
shall further contain a provision that no act or omission by Owner,
unless acting within the scope of his authority on behalf of the
Association, will void the policy or operate as a condition to
recovery by any other person under such policy.
c. Fidelity Bond. A bond or bonds as will cover
against losses to the Association due to dishonest acts on the part
of directors, officers, employees, agents, or volunteers who have
control of, or access to, the funds of the Association, including
the Managing Agent (collectively referred to here as the
"Principals") . Such fidelity bond or bonds shall name the Asso-
ciation as obligee and shall be written with loss coverage not less
than the maximum amount of funds of the Association over which said
Principals under the bond or bonds may reasonably be expected to
have control or access at any time, and shall contain waivers of
any defense based on the exclusion of persons who serve without
compensation or from any definition of "employee" or similar
expression. An agent's rider must also be attached which includes
the Managing Agent within the bond definition of "employee,"
although such Managing Agent may be an independent contractor.
d. Association Officer and Director Insurance. A
policy of insurance on behalf of each Association officer, Associa-
tion director, and member of any Association committee (collectiv-
ely called "Association Agents") protecting each said Association
Agent to an amount which the Association deems is satisfactory,
against any liability asserted against or incurred by him or her in
the capacity of carrying out such Agent's duties, regardless of
whether the Association would have the power to indemnify such
Association Agent against such liability under applicable law.
e. Workmen's Compensation Insurance. A policy of
workmen's compensation insurance, to the extent same shall be
required by law, for all employees of the Association.
f. Loss of Income Insurance. A policy of insurance
gral1-03\docs\cers.01
(August 31, 1998)76
covering the Association for losses of income from lack of Members'
payment of Assessments, where such coverage is available and not
cost-prohibitive.
g. Any Other Insurance. Any other policy or policies
of other insurance deemed necessary or desirable by the Associa-
tion.
8.02 Insurance Procedures.
a. General. All of the policies required to be
obtained by the Association pursuant to Section 8.01 above shall
cover such risks and be written by such insurers as the Association
shall deem proper under the circumstances.
b. Notice of Cancellation. All liability and property
insurance carried by the Association shall require the insurer to
notify any Mortgagee requesting any notice of cancellation of such
a policy or policies at least 30 days in advance of the effective
date of any reduction or cancellation of such policy or policies.
c. Annual Review of Policies. All insurance policies
shall be reviewed at least annually by the Board in order to
ascertain whether the coverage contained in the policies is
adequate.
d. Payment of Premiums. Premiums on insurance main-
tained by the Association shall be a Basic Expense funded by
Regular Annual Assessments levied by the Association.
8.03 Fire and Extended Coverage on All Facilities/Amenities
Condominium Owners' Personal Property. Each Owner of a Facilities/
Amenities Condominium shall also purchase and maintain at such
Owner's own cost a policy or policies of insurance insuring such
Owner's Facilities/Amenities Condominium Owner's Personal Property
against loss or damage by fire and other hazards covered by fire
insurance policies written with extended coverage in an amount of
not less than the full replacement value thereof.
ARTICLE 9
DAMAGE TO OR DESTRUCTION OF PROJECT
9.01 When Duty to Repair and Restore Project Is Mandatory.
Upon damage to or destruction of the Project, the Association
Personal Property, and/or the Common Furnishings, or any portion
thereof, it shall be the duty of the Association to repair and
restore the same to their former condition as soon after such
damage or destruction as is reasonably possible, where the amount
available from insurance proceeds for such repair and restoration
is at least 80 percent of the estimated cost of such repair and
gra11-03\docs\ccrs.01
(August 31, 1998) 77
restoration. The cost, in excess of such available insurance
proceeds, of such repair and restoration shall be a Special Expense
of the Association payable through the Association's levy of a
Special Assessment against each Owner in accordance with Paragraph
6.03 hereof, except that the portion thereof relating to the repair
and restoration of Common Furnishings shall be a Special Assessment
only against each Vacation Ownership Owner.
9.02 When Duty to Repair and Restore Project Is to Be
Determined by Owners. In the event of damage to or destruction of
the Project, Association Personal Property, and the Common
Furnishings, where the amount available from insurance proceeds for
repair and restoration of such is less than 80 percent of the
estimated cost of such repair and restoration, the Condominium
Interest Owners and the Mortgagees of Condominium Interests shall
have the right and power to determine whether or not to repair and
restore the Project. Such issue shall be decided, if at all,
within 60 days after the Association determines that the insurance
proceeds are less than 80 percent of the estimated cost of restora-
tion (called the "60-Day Period"), by the vote or written consent
of: (a) (i) Declarant, (ii) Members holding at least a majority of
the total votes in the Association, excluding votes held by
Declarant with respect to Declarant Vacation Ownerships, (iii) the
Owner(s) of at least eight (8) Facilities/Amenities Condominiums,
and (iv) 75 percent of the Mortgagees holding beneficial interests
in Condominium Interests (where Class "C" Membership has not yet
been converted to Class "A" or Class "B" Membership); or (b) (i)
Members holding at least a majority of the total votes in the
Association, (ii) Members holding at least a majority of the total
votes in the Association, excluding votes held by Declarant with
respect to Declarant Vacation Ownerships, (iii) the Owners of at
least eight (8) Facilities/Amenities Condominiums, and (iv) 75
percent of the Mortgagees holding beneficial interests in
Condominium Interests (where Class "C" Membership has been
converted to Class "A" or Class "B" Membership). Failure of the
Owners and said Mortgagees to make such determination of whether or
not to repair and restore the Project, Association Personal
Property, and Common Furnishings within the 60-Day Period shall be
deemed to be a determination by the Owners and said Mortgagees to
repair and restore the same. A prevailing decision not to restore
and repair the Project, Association Personal Property, and Common
Furnishings shall also automatically be deemed (that is, without a
further vote being required) to carry with it a decision by said
Owners to sell the Real Property, all Association Personal
Property, and all Common Furnishings.
a. If Owners and Mortgagees Determine to Repair and
Restore the Project. Association Personal Property, and Common
Furnishings. If the Condominium Interest Owners and said
Mortgagees determine to repair and restore the Project, Association
Personal Property, and Common Furnishings in accordance with the
gra11-03\docs\ccrs.01
(August 31, 1998) 78
foregoing, the cost of such repair and restoration in excess of the
available insurance proceeds shall be a Special Expense of the
Association payable through the Association's levy of a Special
Assessment against each Owner in accordance with Paragraph 6.03
hereof, except that the portion thereof relating to the repair and
restoration of the Common Furnishing shall be a Special Assessment
only against each Vacation Ownership Owner. In the event the Owners
and said Mortgagees fail to determine whether or not to repair and
restore the Project, Association Personal Property, and Common
Furnishings within the 60-Day Period pursuant to Paragraph 9.02
above, such repair and restoration shall be undertaken and
completed by the Association, and the Condominium Interest Owners
hereunder shall pay their respective shares thereof in accordance
with the preceding sentence.
b. If Owners and Mortgagees Determine Not to Repair and
Restore the Project. Association Personal Property, and the rmrnno^
Furnishings. If the Owners and said Mortgagees determine not to
repair and restore the Project, the Association Personal Property,
and the Common Furnishings, All of the rights, powers, and duties
specified in Section 11.02 below ("Procedures Relating to Sale of
All Association Property and All Common Furnishings") shall
immediately belong to, and be vested in, the Association acting
through its Board.
9.03 Damage or Destruction of Association Personal Property
Only. In any case where there is damage to or destruction of only
Association Personal Property, the Association shall immediately
cause same to be repaired, restored, and/or replaced, as may be
applicable, and the cost thereof shall be a Special Expense of the
Association payable through the Association's levy of a Special
Assessment against each Condominium Interest Owner.
9.04 Damage or Destruction of Common Furnishings Only. In any
case where there is damage to or destruction of only Common
Furnishings in any Vacation Unit and/or Association Personal
Property, the Association shall immediately cause same to be
repaired, restored, and/or replaced, as may be applicable, and the
cost thereof shall be a Special Expense of the Association payable
through the Association's levy of a Special Assessment against each
Vacation Ownership Owner.
9.05 Distribution of Distributable Net Proceeds from Insurance
Proceeds. Any Distributable Net Proceeds resulting from the
Association's receipt of insurance proceeds, either in excess of
the cost of restoration and repair of the Project and/or the
Association Personal Property or in the event the Project and such
Association Personal Property is not repaired and restored as
provided above, shall be distributed by the Association to each
Condominium Interest Owner in accordance with Section 2.08.
Likewise, any Distributable Net Proceeds resulting from the
gra11-03\docs\ccrs.01
(August 31, 1998) 79
Association's receipt of insurance proceeds in excess of the cost
of restoration and repair of the Common Furnishings or in the event
the Project is not required to be repaired and restored as provided
above shall be distributed to each Vacation Ownership Owner in
accordance with Section 2.08.
ARTICLE 10
CONDEMNATION
10.01 Definitions. The term "Taking," as used in this
article, shall mean condemnation by exercise of the power of
eminent domain or by sale under threat of the exercise of the power
of eminent domain of all or any portion of the Real Property. A
"Total Taking" shall be deemed to occur if there is a permanent
Taking by condemnation of an interest in all or any portion of the
Real Property to the extent that the operation, use, and occupancy
of the Real Property as a timeshare resort is substantially and
adversely affected. A "Partial Taking" is any taking other than a
Total Taking.
10.02 Determination of Total Taking to Be Made bv Owners. In
the event of a Taking, the Condominium Interest Owners shall have
the right and power to determine whether or not the Taking is a
Total Taking. Such issue shall be decided, if at all, within 60
days after the effective date of the Taking (called the "60-Day
Period") by the vote or written consent of at least: (a) (i)
Declarant, (ii) Members holding at least a majority of the total
votes in the Association, excluding votes held by Declarant with
respect to Declarant Vacation Ownerships, and (iii) the Owner(s) of
at least eight (8) Facilities/Amenities Condominiums (where Class
"C" Membership has not yet been converted to Class "A" or Class "B"
Membership); or (b) (i) Members holding at least a majority of the
total votes in the Association, (ii) Members holding at least a
majority of the total votes in the Association, excluding votes
held by Declarant with respect to Vacation Ownerships, and (iii)
the Owner(s) of at least eight (8) Facilities/Amenities
Condominiums (where Class "C" Membership has been converted to
Class "A" or Class "B" Membership) . Failure of the Owners to
determine whether the Taking is or is not a Total Taking within the
60-Day Period shall be deemed to be a determination by the Owners
that the Taking is a Partial Taking. A determination that the
Taking is a Total Taking shall also automatically be deemed (that
is, without a further vote being required) to carry with it a
determination by the Owners to sell the Real Property, all
Association Personal Property, and all Common Furnishings. If the
Owners determine that the Taking in question is a Total Taking, all
of those rights, powers, and duties specified in Section 11.02
below ("Procedures Relating to Sale of All Association Property and
All Common Furnishings") shall immediately belong to, and be vested
in, the Association, acting through its Board.
gra11-03\docs\ccrs.01
(August 31, 1998) 80
10.03 Board to Represent Owners in Proceedings. Upon any
Taking of the Property, the Board shall represent all of the
Condominium Interest Owners in any action to recover a condemnation
award, subject to the right of each Mortgagee of record, upon
request, to join in the proceedings. The Board, in its discretion,
may at any time decide to settle such legal action, keeping as its
standard in making any such decision, the doing of what is best
for a majority of the Owners. No Owner shall challenge the good
faith exercise of the discretion of the Board in fulfilling its
duties under this Article 10. The Board is further empowered,
subject to the limitations herein, to act as the sole
representative of all Condominium Interest Owners with respect to
all aspects of any condemnation proceedings not specifically
covered in this Article 10. The Board, immediately upon receiving
knowledge of any Taking, or any threat thereof, shall promptly
notify all Owners, and those Mortgagees who have filed with the
Association a written request for such notice.
10.04 Repair on Partial Taking. Upon there being a
determination of a Partial Taking, or failure of the Owners to make
such determination within the 60-Day Period as provided for in
Section 10.02 above, the Association shall immediately undertake,
and complete within a reasonable period of time, any and all
repairs to, and restoration of, the Project, Association Personal
Property, and Common Furnishings which may be required as a result
of such Partial Taking. The cost of such repair and restoration
shall be a Special Expense of the Association payable through the
Association's levy of a Special Assessment against each Condominium
Interest Owner in accordance with Paragraph 6.03 hereof, except
that the portion thereof relating to the repair and restoration of
Common Furnishings shall be a Special Assessment levied only
against each Vacation Ownership Owner.
10.05 Distribution of Distributable Net Proceeds from Condem-
nation Award. Any Distributable Net Proceeds resulting from the
Association's receipt of condemnation award proceeds shall be paid
by the Association to each Condominium Interest Owner in accordance
with Section 2.08, except that any portion thereof attributable to
only the Common Furnishings shall be paid only to each Vacation
Ownership Owner. Notwithstanding anything in the foregoing to the
contrary, upon any Partial Taking, the Board shall determine if any
particular Owners have suffered more than other Owners as a result
of the Taking. If such a determination is made, each Owner who has
suffered more shall be entitled to a portion of the condemnation
award which is greater than the less-suffering Owners to the extent
that it reasonably compensates such Owner for such Owner's
suffering. In addition, or in lieu of the foregoing, the
Association shall take other appropriate, equitable action designed
to insure that no particular Owner suffers more than any other
Owner as a result of a Partial Taking. Such appropriate, equitable
action might include, but by no means be limited to, shortening the
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(August 31, 1998) 81
length of what otherwise would be Use Weeks of all Vacation
Ownership Owners so that all such Owners could continue to enjoy
the Project.
ARTICLE 11
SALE OF ALL ASSOCIATION PROPERTY AMD ALL COMMON FURNISHINGS
11.01 When Condominium Interest Owners Shall Have Been Deemed
to Have Determined to Sell All Association Property and All Common
Furnishings.
a. On Destruction or Condemnation of Project. The
Condominium Interest Owners shall be deemed automatically to have
determined to sell all Association Property (Association Real
Property and Association Personal Property) and all Common
Furnishings upon the occurrence of either of the following events:
(i) said Owners having made the determination, pursuant to Section
9.02 above, not to repair and restore the Project upon its being
damaged or destroyed; or (ii) said Owners having made the
determination, pursuant to Section 10.02 above, that there had been
a Total Taking of the Real Property by condemnation.
b. By Vote After December 31. 2068. In addition to the
occurrence of the sale-triggering events referred to in Paragraph
a. above, at any time after December 31, 2068, the Condominium
Interest Owners shall have the right and power to offer to sell and
sell all Association Property and all Common Furnishings upon the
vote or written consent to so do of: (a) (i) the Declarant, (ii)
Members holding at least a majority of the total votes in the
Association, excluding votes held by Declarant with respect to
Declarant Vacation Ownerships, and (iii) the Owner(s) of at least
eight (8) Facilities/Amenities Condominiums (where Class "C"
Membership has not yet been converted to Class "A11 or Class "B"
Membership); or (b) (i) Members holding at least a majority of the
total votes in the Association, (ii) Members holding at least a
majority of the total votes in the Association, excluding votes
held by Declarant with respect to Declarant Vacation Ownerships,
and (iii) the Owner(s) of at least eight (8) Facilities/Amenities
Condominiums (where Class "C" Membership has been converted to
Class "A" or Class "B" Membership) . If the Owners determine by the
foregoing vote to sell the Association Property and all Common
Furnishings, all of the rights, powers, and duties specified in
Section 11.02 below ("Procedures Relating to Sale of All
Association Property and All Common Furnishings") shall immediately
belong to, and be vested in, the Association, acting through its
Board.
11.02 Procedures Relating to Sale of All Association Property
All Common Furnishings.
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(August 31, 1998) 82
a. General Power and Authority Granted to Association.
Upon the Condominium Interest Owners having determined to sell all
Association Property and all Common Furnishings in accordance with
either: (i) Section 9.02 above (upon damage to or destruction of
the Project), or (ii) Section 10.02 above (upon there being a
Total Taking of the Real Property by condemnation) , or (iii)
Section 11.01 b. above (by vote after December 31, 2068), each
Condominium Interest Owner, by virtue of such Owner's having
accepted a deed to such Condominium Interest or otherwise owning
such an Interest, shall be deemed to have conferred upon the
Association, acting through its Board, any and all of each such
Owner's right, power, and authority, to sell and convey all
Association Property and all Common Furnishings in accordance with
this Article 11.
b. Grant of Special Power of Attorney. To carry out
the intent and purposes of Section 11.02 a. above, each Condominium
Interest Owner, by virtue of its having accepted a deed to such
Condominium Interest or otherwise owning such an Interest, hereby
constitutes and appoints the Association, acting through its Board,
whether as Trustee or otherwise, as said Owner's attorney-in-fact
in said Owner's name, place, and stead, and for said Owner's use
and benefit, to execute, acknowledge, and deliver on behalf of such
Owner any instrument or document which may be required in order to
effect the sale and conveyance of all Association Property and all
Common Furnishings, including but not limited to: (i) any purchase
contract, (ii) any escrow instructions, (iii) any deed or other
instrument of conveyance, (iv) any trust agreement pursuant to
which the Association, as trustee, may acquire title to all of such
property, for the purpose of disposing of the same, and pursuant to
which trust agreement all Owners shall be the beneficiaries; and
(v) any document(s) of conveyance as may be reasonably required to
convey title of the Condominium Interest(s) of each such Owner to
the Association, as trustee. Each Condominium Interest Owner does
further give and grant to the Association, as trustee or otherwise,
acting through its Board, as said Owner's attorney-in-fact, full
power and authority to do and perform any act necessary and proper
to be done in the exercise of the foregoing powers, including,
without limitation, the power and authority to petition for sale in
lieu of partition, if necessary to effect such conveyance, as fully
as each such Owner might or could do. Each foregoing power of
attorney: (i) shall be irrevocable and be deemed coupled with an
interest; and (ii) shall be binding upon each Condominium Interest
Owner.
c. Property to Be Offered for Sale. Immediately upon
the Association's having determined to sell all Association
Property and all Common Furnishings pursuant to: (i) either Section
9.02 above (upon damage to or destruction of the Project), or (ii)
Section 10.02 above (upon there being a Total Taking of the Real
Property by condemnation), or (iii) Section 11.01 b. above (by
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(August 31, 1998) 83
vote after December 31, 2068), the Association, acting through its
Board, shall offer for sale all Association Property and all Common
Furnishings in accordance with Paragraph d. below.
d. Property to Be Appraised. Immediately upon the
Association's having determined to sell all Association Property
and all Common Furnishings upon any of those events set forth in
Paragraph c. above, the Association, acting through its Board,
shall hire a real estate appraiser who is a Member Appraisal
Institute (MAI) of the American Institute of Real Estate Appraisers
to make an appraisal of all of such property. Immediately after
receiving such appraisal, the Association, acting through its
Board, shall establish the selling price for the Association Real
Property, the Association Personal Property, and the Common
Furnishings and shall offer such property for sale to the public,
using a real estate broker or brokers, and such other broker(s) , if
it chooses. The Association, acting through its Board, shall
thereafter use its best efforts to sell all of such property.
e. Sale Price Factors. The Owners realize that the
sale price of the Association Property may be affected by local
laws and policies then in effect at the time such Property is
offered for sale, such as, without limitation, ordinances of the
City of Carlsbad related to land use and zoning and various
restrictions of the California Coastal Commission.
f. Petition for Sale. In the event that no consumma-
tion of a sale and conveyance of all Association Property and all
Common Furnishings shall have been effected by the Association
within 18 months after the Association has made the determination
to sell such property, any Condominium Interest Owner shall have
the right to petition a court of competent jurisdiction to order
the sale of such property.
g. Distribution of Net Proceeds from Sale. Upon
consummation of any sale of the Association Property and Common
Furnishings, any Distributable Net Proceeds therefrom shall be
distributed by the Association to each Condominium Interest Owner
in accordance with Section 2.08, except that any portion thereof
attributable to only the Common Furnishings shall be paid to only
each Vacation Ownership Owner.
h. Arbitration of Disputes. In the event of any
irreconcilable dispute between or among any of the following: the
Declarant, any Condominium Interest Owner(s), and/or the Associa-
tion relating to their respective rights under, or otherwise
concerning the subject matter of, Article 9 (Damage to or
Destruction of Project), Article 10 (Condemnation), this Article 11
(Sale of All Association Property and All Common Furnishings),
Section 2.18 hereof (Limitations on Partition of Common Area), or
Section 2.05 (Allocation of Distributable Net Proceeds Among
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(August 31, 1998) 84
Owners) , any such party may cause the same to be referred to
binding arbitration in accordance with the provision of Section
16.09 below.
ARTICLE 12
SPECIAL PROVISIONS FOR ENFORCEMENT OF DECLARANT'8 OBLIGATIONS
12.01 General. The procedures set forth in this Article 13
are hereby established for the enforcement of the following
obligations of the Declarant to the Association and to the Members
thereof:
a. Completion of construction of the Needs, and
conveyance to the Association of the Real Property and the Common
Furnishings, in Phase I of the Project included in the offering for
which the Declarant has given a bond or other type of security to
the Association for the commitment of the Declarant to complete
construction of said Improvements.
b. Payment to the Association of Regular Annual
Assessments, Special Assessments, and Capital Needs Assessments
owed by the Declarant, as to Declarant Condominium Interests.
c. Any subsidy agreement between Declarant and
Association by which Declarant has agreed to subsidize any portion
of the costs of administering, managing, and operating the Project
and the Vacation Ownership Operation.
12.02 Periodic Statements Required from Declarant. The
Declarant shall, within 30 days after the end of each quarter of
each Fiscal Year of the Association, furnish to each director on
the Board at his or her residence address a statement containing
the following information, as may be applicable:
a. A status report covering each Improvement in Phase
I in the offering which was scheduled for completion or
installation during the quarter in question according to the
Planned Construction Statement for the Project, and each still-
uncompleted Improvement that was scheduled for completion or
installation during an earlier quarter.
b. Where there is no subsidy agreement between
Declarant and Association which is in effect (because of its
termination for any reason) as of the time Declarant is to make the
periodic statement required under this Section 12.02, the Declarant
shall report the following:
1. The number of Declarant Condominium Interests
(Facilities/Amenities Condominiums and Vacation Ownerships),
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(August 31, 1998) 85
respectively, as of the first and last day of the reporting quarter
in question.
2. The total Regular Annual Assessments and
Special Assessments which the Declarant became obligated to pay
during such reporting quarter as an Owner of Declarant Condominium
Interests.
3. The total Regular Annual Assessments and
Special Assessments paid by the Declarant during such reporting
quarter.
4. The amount of any delinquency of the Declarant
in the payment of Regular Annual Assessments and Special
Assessments that has not been cured as of the date of Declarant's
report.
c. An itemized report of funds, goods and/or services
furnished, or caused to be furnished, to the Association under a
subsidization program of Declarant, including monetary contribu-
tions to the reserves of the Association for replacement of, or for
major repairs to, any portion of the Improvements, and an itemized
monetary valuation of any such goods and services furnished.
12.03 Required Board Discussion and Vote. If the statement of
the Declarant referred to in Section 12.02 above is not received by
the Board within 45 days after the end of a quarter, or if the
statement as received evidences a failure by the Declarant to
fulfill an obligation to the Association, the Board shall meet
specially, together, or by conference telephone call, to discuss
and to vote on the question of initiating action against the
Declarant and/or the Declarant's surety to enforce the Declarant's
unfulfilled obligations.
12.04 Board Action to Enforce Declarant's Obligations. At any
time after the Board discusses and votes on the question of
initiating action against the Declarant and/or the Declarant's
surety to enforce any unfilled obligations of Declarant, as
provided for in Section 12.03 above, the Board may initiate such
action.
12.05 Sole Director Action to Enforce Declarant's Obliga-
tions. If (i) within 75 days after the end of a particular Fiscal
Year quarter, the Board fails to discuss and vote (in accordance
with Section 12.03 above) on the question of requiring the
Declarant's failure to fulfill one or more of its obligations
hereunder to the Association, or (ii) if at any time after the
Board has discussed the Declarant's failure to fulfill any such
obligation, but either has voted not to initiate enforcement
action, or has failed to take such vote, then in such event, the
director on the Board of the Association elected solely by the
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(August 31, 1998) 86
votes of the Members other than Declarant (pursuant to the Bylaws)
may thereafter initiate such an action in the name of the Associa-
tion and at the Association's expense to enforce Declarant's
unfulfilled obligation(s). If said Director determines that it is
in the best interest of the Members of the Association to initiate
such an action under the foregoing special authority, he, or she
shall do so in the name of the Association within 90 days after the
end of the quarter in question, and the Board shall thereafter take
such steps as are necessary and appropriate in furtherance of the
purpose of such action.
12.06 Arbitration with Respect to Question of Declarant's
Fulfillment of Obligation(s). In the event of any irreconcilable
dispute between the Declarant and the Association with respect to
the question of the fulfillment of the Declarant's obligations
referred to in Section 12.01 above, either such party may cause the
same to be referred to binder arbitration, in accordance with the
provisions of Section 15.09 below.
ARTICLE 13
PROJECT PHASING AND ANNEXATION PROCEDURE
13.01 Declarant's Right to Phase. Vary Phasing, or Refrain
from Phasing. As provided in Recital Paragraph B. above, Declarant
intends to construct the Project in three (3) Phases (or Modules):
Phase I shall consist of the construction of 71 Vacation
Condominiums and 14 Facilities/Amenities Condominiums. Phase II
shall consist of the construction of 72 Vacation Condominiums.
Phase III shall consist of the construction of 18 Vacation
Condominiums. The location upon the Land of each such Phase is as
delineated on the Condominium Plan. However, notwithstanding the
foregoing, Declarant may decide to construct what would otherwise
be separate Phases II and III, at the same time.
Notwithstanding anything in the above to the contrary,
Declarant, in its own absolute discretion (without requiring any
approval of the other Condominium Interest Owners, the Association,
or the Board, may subsequently decide: (i) to change the number of
presently contemplated Units for Phase II and/or for Phase III;
(ii) to eliminate Phase II and/or Phase III, and the Annexable
Properties, entirely from the contemplated Development, and/or
(iii) to develop either Phase II, Phase III, or both of them, with
hotel units and/or any other type of real property improvements
which Declarant views as suitable for the Annexable Properties,
including, without limitation, the possibility of developing either
such Phase, or both of them, with a combination of timeshare units
and hotel units and/or other types of real property improvements.
It is thus the overall intent of Declarant to retain and maintain
the utmost flexibility with respect to the development of Annexable
Property #1 and Annexable Property #2.
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(August 31, 1998) 8/
13.02 Annexation in Connection with Phasing.
a. Declarant's Right to Annex. Declarant shall have,
and continue to have, the absolute right, but not the obligation,
as provided above, to: (i) annex to the Phase I Property, (ii)
impose this Declaration and the Vacation Ownership Declaration on,
(iii) construct vacation resort and related Improvements on, (iv)
thereafter convey such developed Real Property to the Association,
and (v) offer for sale and sell Vacation Ownerships in, that
certain real property which adjoins the Land, called here Annexable
Property #1, legally described on Exhibit "C" attached hereto and
made a part hereof. Declarant may, but shall not be obligated to,
repeat the same process, as part of Phase III of the Development,
as to Annexable Property #2, legally described on Exhibit "D"
attached hereto and made a part hereof. Notwithstanding anything in
the foregoing to the contrary, Declarant may reverse the order of
the phasing, by first annexing the Phase III Property to the Phase
I Property.
When either such Annexation is accomplished, such Annexed
Property shall henceforth be bound by each of the covenants,
conditions and restrictions of this Declaration.
b. How Annexation Accomplished. Such annexation shall
be accomplished (without requiring any approval of the other
Condominium Interest Owners, the Association, or the Board), if at
all, by the Declarant's filing for record in the Official Records
of San Diego County, California, of (i) a Declaration of Annexation
(in a form similar to that set forth in Exhibit "E" attached hereto
and made a part hereof) , and (ii) a suitable amendment to the
Condominium Plan or an amended Condominium Plan which delineates
the Units in the Phase being added to the Project, with respect to
each Annexable Property being so annexed.
13.03 Possible Impact and Effects of Subsequent Development.
Each Condominium Interest Owner acknowledges and accepts the fact
that development of the Project in Phases, or development of
Annexable Property #1 and Annexable Property #2 without phasing (as
opposed to one-time construction) will likely cause some disruption
upon the Project, due to the inherent nature of the construction
process, including such things as dust from grading and noise from
use of equipment and tools. Further, as a likely consequence of any
construction being done upon the Annexable Properties, the Owners
realize and accept the fact that some views from the then existing
Vacation Units will likely be impaired by the new construction.
13.04 Possible Discontinuation of Construction.
a. General. Should Declarant choose not to proceed with
the development of Phase II and/or Phase III, as contemplated in
Section 13.01, Declarant shall give the Board notice in writing of
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(August 31, 1998) 88
such a determination.
Thereafter, the existing legal descriptions set forth in each
outstanding deed to each Vacation Ownership, to each
Facilities/Amenities Condominium, and in each deed of trust
encumbering a Vacation Ownership or a Facilities/Amenities
Condominium shall be modified (corrected) by changing the undivided
I/175th interest in the Common Area (which was based upon a full 3-
Phase development) to a fraction in which the denominator is the
actual total number of Condominiums then in the Project.
b. Special Power of Attorney Granted to Association to
Change Legal Description. Should the existing legal description
need to be corrected pursuant to Paragraph a. above: (i) each
Vacation Ownership Owner, including Declarant as to Declarant
Vacation Ownerships, by virtue of such Owner's having accepted a
deed to a Vacation Ownership or otherwise owning such a Vacation
Ownership, and (ii) each Facilities/Amenities Condominium Owner,
including Declarant, by virtue of such Owners having accepted a
deed to such Owner's Facilities/Amenities Condominium or otherwise
owning such a Condominium, and (iii) each Mortgagee by virtue of
its having accepted a Mortgage on a Vacation Ownership, the lien of
which is junior in recording priority to this Declaration, and
(iii) any other mortgagee or trust deed holder holding a mortgage
or deed of trust on all or any portion of the Land, by virtue of
its having accepted a mortgage or deed of trust on all or any
portion of the Land, the lien of which is junior in recording
priority to this Declaration, because it either subordinated its
mortgage or deed of trust to this Declaration, or, where,
otherwise, its mortgage or deed of trust was junior in recording
priority to this Declaration (any such Vacation Ownership Owner,
Facilities/Amenities Condominium Owner, Mortgagee, or other
mortgagee or holder of a deed of trust being called here a
"Principal"), hereby irrevocably appoints and constitutes the
Association, acting through its Board, as each such Principal's
Attorney-in-Fact, with full and exclusive right, power and
authority, in each such Principal's name, place and stead, for each
said Principal's benefit, to: (a) execute, acknowledge, and deliver
on behalf of each such Principal, a deed, mortgage, deed of trust,
escrow instruction(s) and/or any other instrument, including
without limitation, consent to any necessary or advisable amendment
of this Declaration, the Bylaws or the Articles, which may be
required to make, or which may be related to making such a
corrective change of legal description, and (b) do any and all
other acts related thereto in order to accomplish the foregoing
(each such foregoing grant being called a "Special Power of
Attorney"). Each such Special Power of Attorney is and shall be
irrevocable, is coupled with an interest, and is binding upon, and
inures to the benefit of all successors and assigns of each
Principal and all successors and assigns of the Association.
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(August 31. 1998)
c. Amendment. Notwithstanding Section 15.01 below, this
Article 12 may not be amended or revoked without the prior written
consent of the Declarant first being obtained.
d. Time Limitfs) for Annexationfs). Notwithstanding
Declarant's right to annex to the existing Real Property the
Annexable Property set forth in this Article 13, any such
Annexation shall be accomplished, if at all, within the following
time limits:
1. Annexation of Annexable Property #1. Annexable
Property #1 (or Annexable Property #2, if Declarant determines to
annex it first) must be annexed, if at all, by Declarant (or by a
successor or assign) within ten (10) years after the issuance by
the California Department of Real Estate ("ORE") of its first Final
Time Share Project Public Report authorizing the offering for sale
and sale of Vacation Ownerships in Phase I of the Project. Nothing
in this paragraph, however, shall preclude Declarant (or a
successor or assign) from annexing both Annexable Property # 1 and
Annexable Property # 2 within said ten (10)-year period, if it so
desires.
2. Annexation of Annexable Property #2. Following
Annexation of Annexable Property # 1 (or Annexable Property #2, if
Declarant should decide to reverse the order of annexation) within
the then (10)-year period required by Paragraph 1. above, Annexable
Property #2 (or Annexable Property #1) must be annexed, if at all,
by Declarant or by a successor or assign within five (5) years
after the issuance by the ORE of its first Final Time Share Project
Public Report authorizing the offering for sale and sale of
Vacation Ownerships in the combined Phase I and Phase II Property.
If Annexation of the Annexable Property is not accomplished
within the time frames set forth in Paragraphs 1. and 2. above, any
subsequent Annexation shall require the vote or written consent
authorizing such Annexation of: (i) Members holding at least 15
percent of the total votes in the Association, excluding votes held
by Declarant with respect to Declarant Vacation Ownerships, and
(ii) Owner(s) of least eight (8) Facilities/Amenities Condominiums.
ARTICLE 14
DESIGNATION OF VACATION UNITS TO USE PROGRAM
14.01 Designated Vacation Units. As defined in Section 1.55
hereof, Designated Vacation Units are those particular Units which
Declarant, pursuant to the terms of this Article 14, has from time
to time designated and made subject to the Vacation Ownership Use
Program hereunder. With the exception of Declarant Vacation
Ownerships, Vacation Ownerships are created and exist only in
Designated Units, upon such Units having been designated to such
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(August 31, 1998) 90
Use Program. Declarant may offer for sale and/or sell Vacation
Ownerships only in Designated Units and then only when given
authority to do so by the California Department of Real Estate.
14.02 Nondesiqnated Units. As defined in Section 1.87 hereof,
Nondesignated Vacation Units are those particular Units, if any,
which Declarant has not, pursuant to the terms of this Article 14,
designated and made subject to the Use Program hereunder.
14.03 Initially Designated Units. Concurrently with the
recordation of this Declaration, Declarant hereby designates and
makes subject to the Vacation Ownership Use Program hereunder the
following 36 Vacation Units:
(Calledthe"InitiallyDesignatedUnits"),asdelineatedand
referred to on the Project Diagram attached hereto as Exhibit "B".
14.04 Subsequent Designation of Nondesianated Units.
Declarant, without requiring any consent from other Condominium
Interest Owners or from the Association, shall from time to time
(such time to be at Declarant's election) designate and make
subject to the Vacation Ownership Use Program hereunder any number
of the remaining (at the time of the recordation of this
Declaration) Nondesignated Units in Phase I and II until all of
said Nondesignated Units therein have been so designated, in
accordance with the procedure set forth in Section 14.05.
14.05 Procedure for Designating Nondesignated Units.
Designation to the Vacation Ownership Use Program of each
Nondesignated Unit in which Declarant wishes to offer for sale and
sell a Vacation Ownership shall be made and shall be deemed to have
taken effect, upon occurrence of all of the following:
a. Declarant's preparation, and recordation in the
Official Records of San Diego County, California, of a document
entitled Certificate of Designation of Heretofore Nondesignated
Vacation Units (called the "Certificate"), which Certificate shall
contain the following information:
1. The Unit number of each Nondesignated Vacation
Unit thereby being designated;
2. A statement designating said Nondesignated
Vacation Unit or Units and making it or them subject to the Use
Program in the Project; and
3. A statement signed by the Managing Agent to the
effect that, based upon the Managing Agent's inspection, each item
of Common Furnishings scheduled by Declarant to be placed in the
Nondesignated Vacation Unit or Units upon its or their designation
is, in fact, in place in such Unit or Units and is in new or like-
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(August 31, 1998) 91
new condition.
b. Declarant's submission of the following to the
California Department of Real Estate: (i) a copy of said Certifi-
cate, certified by Declarant's title insurance company to be a true
copy of the Certificate which was actually recorded, (ii) a bill
of sale from the Declarant to the Association indicating that the
Association is the legal owner of all Common Furnishings located or
placed in the newly designated Vacation Unit or Units; (iii) an
application requesting the issuance by the California Department of
Real Estate of the appropriate amendment of its Time Share Project
Public Report for the Project authorizing Declarant to offer for
sale and to sell Vacation Ownerships in the Vacation Unit or Units
designated in the Certificate; and (iv) any other documents as may
be required by the California Department of Real Estate in
connection with the Declarant's application in (iii) above.
c. The issuance by the California Department of Real
Estate of its appropriate amendment of the Final Time Share Public
Report for the Project authorizing Declarant to offer for sale and
to sell Vacation Ownerships in the Vacation Unit or Units listed in
the Certificate.
14.06 Reservation Safeguards for Owners of Annual and Biennial
Floating Week/Floating Unit Vacation Ownerships. In order to
ensure and safeguard that each Owner of either an Annual or a
Biennial Floating Week/Floating Unit Vacation Ownership is given
the opportunity to reserve for use and occupancy (on a "first-
reserved, first-served" basis) a Vacation Unit of such Owner's
Assigned Vacation Unit Type for any Use Week of such Owner's choice
occurring during such Owner's assigned Season (Prime Summer Season
or High Season, whichever be the case) for a particular Use Year,
Declarant agrees, for itself, and for its successors and assigns,
if any, that for each Designated Vacation Unit of a Vacation Unit
Type in which Declarant has sold or intends to sell an Annual or
Biennial Floating Week/Floating Unit Vacation Ownership, Declarant
will not offer for sale and/or sell any Annual or Biennial Floating
Week/Fixed Unit Vacation Ownerships in the Season in which any such
Floating Week/Floating Unit Vacation Ownerships have been sold or
will be sold.
Here is how the foregoing rule will be applied: If, for
example, at any point in time four (4) "A" Vacation Unit Type Units
had been designated to the Vacation Ownership Use Program, and
Declarant thereafter sold one (1) Annual Fixed Week/Floating Unit
Vacation Ownership for Fixed Week No. 27 in each Use Year,
Declarant will not be able to offer for sale and sell any Annual or
Biennial Floating Week/Floating Unit Vacation Ownerships for Prime
Summer Season in one (1) of these four (4) Designated "A" Unit Type
Units, but could sell Annual and/or Biennial Fixed Week/Floating
Unit Vacation Ownerships in three (3) of these four (4) Designated
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"A" Vacation Unit Type Units, so long as no additional Annual Fixed
Week/Floating Unit Vacation Ownerships for Fixed Week No. 27 had
been, or will be, sold.
Thus, adding to the above example, where Declarant had sold
one additional Annual Fixed Week/Floating Unit Vacation Ownership
for Fixed Week No. 27 in an "A" Unit Type Unit, Declarant will not
be able to offer for sale and sell any Annual or Biennial Floating
Week/Floating Unit Vacation Ownerships for Prime Summer Season in
two (2) of these four (4) Designated "A" Vacation Unit Type Units,
but could sell Annual and/or Biennial Fixed Week/Floating Unit
Vacation Ownerships in two (2) of these four (4) Designated "A"
Vacation Unit Type Units during Prime Summer Season.
ARTICLE 15
SPECIAL PROVISIONS REQUIRED BY CITY OF CARLSBAD
15.01 General Enforcement by the City. Notwithstanding
anything in this Declaration to the contrary, the City of Carlsbad
(the "City") shall have the right, but not the obligation, to
enforce any of the covenants, conditions and/or restrictions
imposed by this Declaration in favor of the City, or in which the
City has an interest.
15.02 Failure of Association to Maintain Common Area Lots and
Easements. Notwithstanding anything in this Declaration to the
contrary, in the event that the Association fails to maintain the
Association Real Property as required by Section 5.02 f., the City
shall have the right, but not the duty, to perform the necessary
maintenance. If the City elects to perform such maintenance, the
City shall give written notice to the Association, with a copy
thereof to the Condominium Interest Owners, setting forth with
particularity the maintenance which the City finds to be required
and requesting that same be carried out by the Association within
a period of thirty (30) days from the giving of such notice. In
the event that the Association fails to carry out such maintenance
of the Association Real Property within the period specified by the
City's notice, the City shall be entitled to cause such work to be
completed and shall be entitled to reimbursement with respect
thereto from the Owners as provided herein.
15.03 Special Assessments Levied by the City. Notwithstanding
anything in this Declaration to the contrary, in the event the City
has performed necessary maintenance to the Association Real
Property pursuant to Section 15.02 above, the City shall submit a
written invoice to the Association for all costs incurred by the
City to perform such maintenance. The City shall also provide a
copy of such invoice to each Condominium Interest Owner, together
with a statement that, if the Association falls to pay such invoice
in full within the time specified, the City will pursue collection
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against the Condominium Interest Owners, pursuant to the provisions
of this Section 15.03. Said invoice shall be due and payable by
the Association within twenty (20) days of receipt by the
Association. If the Association shall fail to pay such invoice in
full within the period specified, payment shall be deemed
delinquent and shall be subject to a late charge in an amount equal
to six percent (6%) of the amount of the invoice. Thereafter the
City may pursue collection from the Association by means of any
remedies available at law or in equity. Without limiting the
generality of the foregoing, in addition to all other rights and
remedies available to the City, the City may levy a special
assessment against the Owners of each Condominium Interest in the
Project for an equal pro rata share of the invoice, plus the late
charge. Such special assessment shall constitute a charge on the
Real Property and shall be a continuing lien upon each Condominium
Interest against which the special assessment is levied. Each
Condominium Interest Owner hereby vests the City with the right and
power, to levy such special assessment, to impose a lien upon such
Owners respective Condominium Interest and to bring all legal
actions and/or to pursue lien foreclosure procedures against any
Owner and such Owner's respective Condominium Interest for purposes
of collecting such special assessment in accordance with the
applicable procedures for same set forth in this Declaration.
15.04 Notices of Public Hearing from City. From time to time
the City may be required under law to send notices of a forthcoming
public hearing on a matter related to City zoning or land use
requirements to property owners in the vicinity of the Project,
including the Condominium Interest Owners hereunder. Since to have
to mail such notices to each Owner would impose a burden upon the
City and since the content of such notices would similarly affect
all Owners, each Condominium Interest Owner hereby automatically
assigns to the Association his, her,or its right to otherwise
receive from the City individual notices of forthcoming public
hearings pertaining to matters related to City zoning or land use
requirements, with the result that the City may send to the
Association only one such notice, for each such forthcoming
hearing, regardless of the actual number of Owners in the Project.
The Association shall have the responsibility of examining each
such notice of public hearing and taking such action thereon as is
determined by the Association to be in the best interests of a
majority of Owners, including, without limitation, participating in
such hearing. Notwithstanding anything to the contrary above, any
such Owner may require the City to mail individual notices to him,
her, or it, if such Owner gives the City a written request that he,
she, or it be placed on a list to receive such forthcoming notices.
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ARTICLE 16
MISCELLANEOUS PROVISIONS
16.01 Amendment of Declaration
a. Where Class "C" Membership Has Not Yet Been
Converted to Class "A" and/or Class "B" Membership. Where Class
"C" Membership has not been converted to Class "A" and/or Class "B"
Membership, any amendment to this Declaration shall require the
vote or written assent of: (i) the Declarant, (ii) Members holding
at least a majority of the total votes in the Association,
excluding votes held by Declarant with respect to Declarant
Vacation Ownerships, and (iii) Owner(s) of at least eight (8)
Facilities/Amenities Condominiums.
b. Where Class "C" Membership Has Been Converted to
Class "A" and/or Class "B" Membership. Where Class "C" Membership
has been converted to Class "A" and/or Class "B" Membership, and
the Declarant has become a Class "A" or Class "B" Member (pursuant
to Section 4.04 c. above), any amendment to this Declaration shall
require the vote or written assent of: (i) Members holding at least
a majority of the total votes in the Association, (ii) Members
holding at least a majority of the total votes in the Association,
excluding votes held by the Declarant with respect to Declarant
Vacation Ownerships, and (iii) the Owner(s) of at least eight (8)
Facilities/Amenities Condominiums.
c. Other Conditions and Terms. Notwithstanding the
voting requirements in Sections 16.01 a. and 16.01 b. above, if any
specific provision in this Declaration requires a greater voting
percentage than that required for amendment under these Sections
16.01 a. and 16.01 b., amendment of such provision shall require
the same voting percentage of Members as voting on the action
itself. Each amendment shall be binding upon every Owner. Any
amendment authorized hereby shall be evidenced by an instrument in
writing, signed and acknowledged by any two (2) officers of the
Association, which amendment shall be effective upon the
recordation thereof in the Official Records of San Diego County,
California.
d. Protection of Beneficiaries of First Deeds of Trust.
Notwithstanding any other provisions in this Declaration, no
material amendment may be made to this Declaration without the
prior written consent of Mortgagees (called here "First
Mortgagees") holding first (recording priority) Mortgages (called
here "First Mortgages") encumbering Condominium Interests in the
Proj ect.
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For purposes of this Section 16.01 d., a "material
amendment" shall mean any amendment to the provisions of this
Declaration which would do any of the following:
1. Reduce the priority of the liens of such First
Mortgages;
2. Change the priority of Assessment Liens, and/or
the enforcement of such Liens with respect to First Mortgages;
3. Eliminate reserves for the maintenance, repair,
restoration, and/or replacement of the Association Real Property;
4. Remove the responsibility of the Condominium
Ownership Owners Association for the maintenance, repair,
restoration, and/or replacement of the Association Real Property;
5. Authorize any conversion of Vacation Units or
Facilities/Amenities Units into Association Real Property or Common
Area ;
6. Reduce any fire and extended coverage insurance
and liability coverage insurance from the minimum coverage mandated
by this Declaration;
7. Authorize termination of the Project as a time-
share project except as provided for under this Declaration;
8. Authorize any sale of the Project except as
provided for under this Declaration; and or
9. Make any changes in the provisions of this
Section 16.01 d.
Notwithstanding anything in the foregoing which could be
construed to the contrary, this Declaration may be amended without
requiring any consent of First Mortgagees in order to reflect any
change in a legal description of a Condominium Interest which
conceivably could be necessitated by the discontinuation of
construction of, or other changes to, Phases II and/or III as
provided in Section 13.04 above.
An addition or amendment to this Declaration shall not be
considered "material" if it is made solely for the purpose of
correcting technical errors or for clarification.
Any First Mortgagee who receives a written request to give its
approval to a proposed amendment to this Declaration, but fails to
deliver to the requesting party a written disapproval to such
proposed amendment within 30 days after such receipt, shall be
deemed to have consented to such amendment, provided that such
request was delivered by certified or registered mail, with a
"return receipt" requested.
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e. Protection of Declarant. Notwithstanding any other
provision in this Declaration, until the closing of the first
escrow for the sale of a Vacation Ownership, Declarant shall have
the absolute and unilateral right to terminate or amend this
Declaration by recordation of an appropriate termination or
amendment document, so long as such act is in compliance with the
requirements of the California Department of Real Estate.
16.02 Term and Earlier Termination of Declaration.
a. Term of Declaration. Unless terminated sooner in
accordance with Section 16.02 b. below, the covenants, conditions,
and restrictions herein shall run with the land and shall be
binding upon, and shall inure to the benefit of all Condominium
Interest Owners until December 31, 2068, upon which date they shall
be deemed terminated, unless earlier extended by the same vote or
written consent of that number of Members required by Section 16.01
above (Amendment of Declaration) to amend this Declaration.
b. Earlier Termination of Declaration. This Declaration
shall be deemed terminated prior to December 31, 2068 upon the
occurrence of both of the following events: (i) the sale of the
Real Property, and (ii) the recordation in the Official Records of
San Diego County, California, of a Declaration of Termination of
Covenants, Conditions, and Restrictions, stating therein that this
Declaration is terminated, and signed by any two (2) officers of
the Association.
c. Survival of Certain Provisions and Association.
Notwithstanding any termination of this Declaration, the provisions
of this Declaration which are related to: (i) the winding-up of the
Association's affairs and/or the maintenance and disposition of all
of the Association Property and Common Furnishings, and (ii) the
Association and the Board, and their rights, powers, and duties,
shall survive the termination of this Declaration for so long as
necessary.
16.03 Notices. Notices provided for in this Declaration shall
be in writing and shall be deemed sufficiently given either: (i)
when delivered personally to the party being noticed at the
appropriate address set forth below (in which event such notice
shall be deemed effective upon such delivery) , or (ii) 48 hours
after deposit of same in any United States Post Office box in the
state to which the notice is addressed, or (iii) 72 hours after
deposit of same in any such post office box other than in the state
to which the notice is addressed, postage prepaid, addressed as set
forth below. Any notice to an Owner required under this
Declaration shall be addressed to such Owner at the last address
for such Owner appearing in the records of the Association.
Notices to the Association shall be addressed to: 5805 Armada
Drive, Carlsbad, California 92008; notices to the Managing Agent
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shall be addressed to: P.O. Box 4068, Carlsbad, California 92008;
and notices to the Declarant shall be addressed to: 5900 Pasteur
Court, Ste. 200, Carlsbad, California 92008.
16.04 Notification of Sale of Owner's Vacation Ownership.
Prior to any sale or other voluntary transfer of an Owner's
Vacation Ownership, the transferor or transferee shall notify the
Association or the Managing Agent in writing and in whatever form
then required by the Association of such pending sale or transfer.
Such notice shall set forth the name and address of the transferee
and transferor, and the date on which such sale or transfer is to
be consummated. Unless and until such notice is given and any
amounts owed to the Association by the transferor are fully paid,
any transfer made in violation of the above shall be void and shall
not be recognized by the Association for any purpose.
16.05 Indemnification of Directors. Officers. Employees, and
Other Agents. Procedures pertaining to the indemnification of
directors, officers, employees, and other agents of the Association
are established and set forth in Article VIII of the Bylaws.
16.06 Severabilitv and the Rule Against Perpetuities. If any
provision of this Declaration, or any section, sentence, clause,
phrase, or word, or the application thereof, in any circumstances,
shall be held invalid, the validity of the remainder of this
Declaration and/or of the application of such provision, sentence,
clause, phrase, or word under any other circumstances shall not be
affected thereby, and the provisions hereof are deemed independent
and severable. If any provision of this Declaration would violate
the Rule Against Perpetuities or any other limitation on the
duration of the provisions contained herein imposed by law, then
such provisions shall be deemed to remain in effect only for the
maximum permissible period permitted by law or until 21 years after
the death of the last survivor of the now living descendants of
President Bill Clinton and former President George C. Bush.
16.07 Interpretation. The captions of the articles,
paragraphs, and subparagraphs hereof are for convenience only and
shall not be considered in resolving questions of interpretation
or construction or meaning of this Declaration. Whenever the
context of this Declaration requires same, the singular shall
include the plural, and the masculine shall include the feminine
and the neuter.
16.08 No Waiver. The failure of the Association, the
Declarant, the Board, any Owner, or any of their agents to enforce
any provision of this Declaration shall not constitute a waiver
thereof nor of the right to enforce such provision thereafter.
16.09 Personal Covenant. To the extent that the acceptance of
a conveyance or other ownership of a Condominium Interest by a
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Condominium Interest Owner creates a personal covenant between such
Owner, the Declarant, the Association, and the other Condominium
Interest Owners, such personal covenant shall terminate and be of
no further force or effect from and after the date when such Owner
ceases to be such a Condominium Interest Owner (including
Declarant) except with respect to the payment of money or other
obligation owing to the Association by such Owner.
16.10 Arbitration of Disputes. In the event of any
irreconcilable dispute, or a question of interpretation, between or
among any of the following: the Declarant, any Condominium Interest
Owner or Owners, and/or the Association arising out of, or relating
to, the provisions or subject matter of this Declaration, and/or
the Bylaws, Articles, and/or the Rules and Regulations, including,
without limitation, any and all issues relating to the quality of
Declarant's construction of any of the Improvements, any of the
foregoing parties may cause the same to be referred to binding
arbitration in San Diego County, California, to be administered by,
and to be in accordance with the then prevailing commercial rules
of, the American Arbitration Association. The decision of such
arbitrator in this matter shall be final and conclusive upon the
issue or issues in question.
16.11 Attorneys' Fees And Costs. In the event arbitration or
any other legal action is instituted to enforce or interpret any of
the provisions contained in, or to resolve any dispute relating to,
this Declaration, the Articles, the Bylaws, and/or the Rules and
Regulations, the party prevailing in such action shall be entitled
to recover from the losing party thereto such party's reasonable
attorneys' fees and costs of such arbitration or other legal action
(if the arbitrator or judge determines that there is such a
"losing" party).
16.12 Successors. The covenants, conditions, and restrictions
of this Declaration shall run with and bind the Real Property and
any interest therein, and shall inure to the benefit of, be binding
upon, and be enforceable by, the Association, and/or any
Condominium Interest Owner, and/or the Declarant, and each of their
respective legal representatives, heirs, successors, and assigns.
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IN WITNESS WHEREOF, the Declarant has hereunto caused this
Declaration to be executed on the day and year above first written.
GRAND PACIFIC PALISADES LLC,
a California limited liability company
By:
Timothy J. Stripe, Co-President
By:
David S. Brown, Co-President
and Secretary
"Declarant"
STATE OF CALIFORNIA )
) SS.
COUNTY OF SAN DIEGO )
On , before me, ,
Notary Public, personally appeared Timothy J. Stripe and David S.
Brown, personally known to me (or proved to me on the basis of
satisfactory evidence) to be the person whose name is subscribed to
the within instrument and acknowledged to me that they executed the
same in their authorized capacities, and that by their signature on
the instrument, the persons, or the entity upon behalf of which the
persons acted, executed the instrument.
WITNESS my hand and official seal. (Seal)
Signature
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"A"
(TO BE INSERTED)
EXHIBIT "A"
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BXHTBTT MB"
PROJECT DIAGRAM
FOR
THE GRAND PACIFIC PALISADES RESORT
(TO BE INSERTED)
Exhibit "B"
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"C"
LEGAL DESCRIPTION OF ANNBXABLE PROPERTY *1
(TO BE INSERTED)
EXHIBIT "C"
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EXHIBIT "D"
LEGAL DESCRIPTION OF ANNEXABLE PROPERTY *2
(TO BE INSERTED)
EXHIBIT "D"
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EXHIBIT "E"
DECLARATION OF ANNEXATION
(TO BE INSERTED)
EXHIBIT "E"
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