HomeMy WebLinkAboutCT 96-04; Brookfield Meadows; Tentative Map (CT) (3)Brown & Farmer
ADDRESS:
E-MAIL:
FAX:
TEL:
Writer's Direct Email
DATE:
TO:
7777 ALVARADO RD, STE 615, LA MESA, CA 91941-3649
CCi@cci.to or SkyCondo@aol.com
(619)667-6616
(619) 667-2900 or (619) 231-1606 „„„ „ . ..^
SRodick@cci.to ^'J' •' L :
CnrY OF CARLOAD
November 3,1999 VIA COURIER ^ L^T*
RE:
Don Williamson - KEYSTONE COMMUNITIES
5333 Mission Center Rd, Ste 360
San Diego, CA 92108
TEL: 1-619-299-4855 -312
Our File No. 99205 - "Magnolia at La Costa Planned Development"
Enclosed please find a "fresh" copy of the Declaration of CC&R's for Magnolia At La Costa, which
includes revisions made today to properly include and describe:
t T» ^ ' (1 ) tne "Grant of Easement and Maintenance Agreement" (referenced at Section 3. 24
page 7 as ''EA^MENT^PROPERTYj SLOPE EASEMENTS; SLOPE AREA";. Section 3. 54"-"pge 1 1
as "SLOPE 'EMS^MENT^GREEMENf^ and Section '4.2 as "Slope Easement"): and
-ft the Vallecitos Water District clause/provision regarding the Wasterwater
Facility (referej]c^d^Section_L6-pagejas/'BUYERS'ACKNOWLEDGEMENTS'~' •••
&
REGARDING WASTEWATER RECLAMATION FACILITY").
The document also includes the City requirements per the Map Extension. These were already
drafted and provided to you under separate fax transmission. NOTE: I have made minor text
modifications to Section 22.1 under Article 22 - page 73 - "CITY OF CARLSBAD REQUIREMENTS"
**•• the deletion of trTe^rt7"usetrterfri<''1Prot'ective Covehahfs"' and replaced tt with the following bold,
underlined text".... covenants, conditions, restrictions and other provisions set forth in this
eclaration in favor of, or in which the City has an interest," because there is no definition nor need
to define the term "Protective Covenants" in the document.
Finally, please note that these CC&R's are still in DRAFT format, and will remain so until such
time that the Department of Real Estate issues its approval of the document and its
provisions. Therefore, it should not be recorded with the County Recorder until the
Department of Real Estate issues its approval and all other elements related to the CC&R's
have been defined and completed.
Thank you.
Steven E. Rodick
Recording Requested By:
When Recorded Mail To:
JEFFREY L BROWN ESQ
c/o cct
ATT: STEVEN E RODICK
REF: MAGNOLIA AT LA COSTA
7777 ALVARADO ROAD, STE 615
LA MESA CA 91941-3649
(619)667-2900
www.subdivision.net
SPACE ABOVE FOR RECORDER'S USE
Index as "CC&R'S"
uo•o
oCO
S2o
VCO
Ut
DECLARATION
OF
COVENANTS, CONDITIONS AND RESTRICTIONS
FOR
"MAGNOLIA AT LA COSTA"
A Residential Subdivision
CITY OF CARLSBAD, SAN DIEGO COUNTY, CALIFORNIA
TABLE OF CONTENT
RECITALS _ 1
1.1. PROPERTY OWNED BY DECLARANT .................................................... 1
1.2. PURPOSE OF DECLARATION; NATURE OF PROJECT ......................... 1
1.3. DESCRIPTION OF PROJECT: ................................................................. 1
1.3.1. NUMBER OF RESIDENTIAL LOTS ...................................... 1
1.3.2. ASSOCIATION AREA; ......................................................... 1
1.4. PLAN OF DEVELOPMENT ....................................................................... 2
1.5. PHASING .................................................................................................. 2
1.5.1. PUBLIC REPORT; PHASE ................................................... 2
1.5.2. PHASE RECONFIGURATION ..................................... . ........ 2
1 .5.3. BUYERS' ACKNOWLEDGMENTS RELATING TO
PHASING ............. . ................................................................ 2
1 .6. BUYERS' ACKNOWLEDGEMENTS REGARDING WASTEWATER
RECLAMATION FACILITY ........................................................................ 2
1.7. ESTABLISHMENT OF ASSOCIATION ..................................................... 3
2. DECLARATION
3. DEFINITIONS
3.1. ADJACENT PROPERTY ........................................................................... 3
3.2. ANNEXED ................................................................................................. 3
3.3. ANNEXED PHASE .................................................................................... 4
3.4. ANNEXED PROPERTY ............................................................................ 4
3.5. ARCHITECTURAL COMMITTEE .............................................................. 4
3.6. ARCHITECTURAL STANDARDS ............................................................. 4
3.7. ARTICLES ................................................................................................ 4
3.8. ASSOCIATION; HOMEOWNERS ASSOCIATION .................................... 4
3.9. ASSOCIATION AREA ............................................................................... 4
3.10. ASSOCIATION EASEMENT(S) ................................................................. 5
3.11. ASSOCIATION LOT(S) ............................................................................. 5
3.12. ASSOCIATION PROPERTY ..................................................................... 5
3.13. BOARD ..................................................................................................... 5
3.14. BYLAWS ................................................................................................... 5
3.15. CITY .......................................................................................................... 5
3.16. CITY RESOLUTION .................................................................................. 5
3.17. COMMON EXPENSES ............................................................................. 5
3.18. COMMUNITY ............................................................................................ 6
3.19. COUNTY ................................................................................................... 6
3.20. COUNTY RECORDER .............................................................................. 6
3.21. DECLARANT ............................................................................................ 7
MAGNOLIA AT LA COSTA
DECLARATION
3.22. DECLARATION ......................................................................................... 7
3.23. DWELLING; RESIDENCE ......................................................................... 7
3.24. EASEMENT PROPERTY; SLOPE EASEMENTS; SLOPE AREA ............. 7
3.25. ELIGIBLE INSURER, GUARANTOR ......................................................... 7
3.26. ELIGIBLE MORTGAGE HOLDER ............................................................. 7
3.27. EMERGENCY ........................................................................................... 8
3.28. FHLMC ...................................................................................................... 8
3.29. FIRST MORTGAGE .................................................................................. 8
3.30. FIRST MORTGAGEE ................................................................................ 8
3.31. FNMA ........................................................................................................ 8
3.32. IMPROVEMENT(S) ................................................................................... 8
3.33. INSTITUTIONAL MORTGAGEE ............................................................... 8
3.34. INVITEE .................................................................................................... 8
3.35. MAP; SUBDIVISION MAP ......................................................................... 8
3.36. MEMBER .................................................................................................. 9
3.37. MORTGAGE ............................................................................................. 9
3.38. MORTGAGEE ........................................................................................... 9
3.39. MORTGAGOR .......................................................................................... 9
3.40. NOTICE AND HEARING ........................................................................... 9
3.41. OWNER .................................................................................................... 9
3.42. PERSON ................................................................................................... 9
3.43. PHASE ...................................................................................................... 9
3.44. PRIVATE STREET(S); PRIVATE ROAD(S) ............................................ 10
3.45. PROJECT ............................................................................................... 10
3.46. PROJECT DOCUMENTS ........................................................................ 10
3.47. PROPERTY ............................................................................................ 10
3.48. PUBLIC REPORT ................................................................................... 10
3.49. PUBLIC STREET(S) ............................................................................... 10
3.50. RECORD; RECORDED; RECORDATION .............................................. 10
3.51. RESIDENTIAL LOT; LOT ........................................................................ 11
3.52. RETAIL BUYER ...................................................................................... 11
3.53. RULES .................................................................................................... 11
3.54. SLOPE EASEMENT AGREEMENT .............................................. . ......... 11
3.55. SUBDIVISION MAP: MAP ....................................................................... 11
3.56. UNANNEXED PHASE ............................................................................. 11
3.57. OWNERSHIP OF RESIDENTIAL LOTS .................................................. 11
4. EASEMENTS
4.1. EASEMENTS FOR ASSOCIATION AREA .............................................. 12
4.1.1. SUSPEND RIGHTS OF MEMBERS ................................... 12
4.1.2. DEDICATE OR GRANT EASEMENTS ............................... 12
4.1.3. PERFORM ASSOCIATION FUNCTIONS ........................... 12
4.1.4. EASEMENT TO DECLARANT AND BUILDER(S) FOR
ACCESS TO UNANNEXED PHASES AND ADDITIONAL
PROPERTY ........................................................................ 12
4.2. SLOPE EASEMENT ......... . ...................................................................... 12
4.3. DRAINAGE; SLOPES ............................................................................. 13
4.4. OWNERS' RIGHTS, DUTIES AND EASEMENTS FOR UTILITIES ......... 13
MAGNOLIA AT LA COSTA
DECLARATION ii
4.5. OBSTRUCTION OF VIEW OR LIGHT; NO VIEW OR LIGHT
EASEMENTS; OWNER ACKNOWLEDGMENT 14
4.6. DECLARANT'S NON-EXCLUSIVE EASEMENTS 14
4.7. DECLARATION SUBJECT TO EASEMENTS 14
5. THE ASSOCIATION 14
5.1. THE ORGANIZATION 14
5.2. COMMENCEMENT OF ASSOCIATION BUSINESS 14
6. MEMBERSHIP. VOTING. FIRST MEETING 15
6.1. MEMBERSHIP IN GENERAL 15
6.2. CLASSES OF VOTING RIGHTS 15
6.2.1. CLASS A 15
6.2.2. CLASS B 15
6.3. COMMENCEMENT OF VOTING RIGHTS 15
6.4. APPROVAL OF MEMBERS 16
6.4.1. VOTE OF MAJORITY 16
6.4.2. WRITING 16
6.4.3. COMBINATION OF VOTES AND WRITING 16
6.5. FIRST MEETING OF THE ASSOCIATION 16
6.6. CLASS A MEMBERS' SELECTION OF ASSOCIATION DIRECTORS.... 16
6.7. NO PERSONAL LIABILITY OF BOARD MEMBERS 16
£ RIGHTS. POWER AND DUTIES OF ASSOCIATION AND
BOARD 17
7.1. ASSESSMENTS 17
7.2. RIGHT OF ENFORCEMENT; PENALTIES; NOTICE AND HEARING 17
7.2.1. ENFORCEMENT ACTIONS 17
7.2.2. PENALTIES AGAINST MEMBERS 17
7.3. RULES AND REGULATIONS 18
7.4. RIGHT TO ENTER RESIDENTIAL LOT 18
7.5. BORROW FUNDS 19
7.6. POWER OF BOARD TO DEFINE AND INTERPRET 19
8, RIGHTS OF OWNERS 19
8.1. RIGHTS OF OWNERS 19
8.2. RIGHT OF ACCESS AND USE OF DWELLING 19
8.3. NOTICE AND HEARING 20
9. ASSESSMENTS 20
9.1. COVENANT FOR ASSESSMENTS 20
MAGNOLIA AT LA COSTA
DECLARATION Hi
9.2. FUNDS HELD IN TRUST 21
9.3. PURPOSE OF ASSESSMENTS 21
9.4. REGULAR ASSESSMENTS 21
9.4.1. PAYMENT OF REGULAR ASSESSMENTS 21
9.4.2. BUDGETING 21
9.4.3. RESTRICTIONS OF TAX EXEMPTION 21
9.4.4. ASSESSMENTS AFTER ANNEXATION 22
(A) REALLOCATION OF ASSESSMENTS 22
(8) REVISION OF BUDGET 22
9.5. NON-WAIVER OF ASSESSMENTS 22
9.6. SPECIAL ASSESSMENTS 22
9.7. CAPITAL IMPROVEMENT ASSESSMENT 23
9.8. SINGLE BENEFIT ASSESSMENT 23
9.9. ENFORCEMENT ASSESSMENTS 23
9.10. UNIFORM RATE OF ASSESSMENT 24
9.11. EXCESSIVE ASSESSMENTS OR FEES 24
9.12. COMMENCEMENT OF ASSESSMENTS; DUE DATES 24
9.12.1. FIRST PHASE 24
9.12.2. SUBSEQUENT PHASE(S) 24
9.13. NOTICE AND ASSESSMENT INSTALLMENT DUE DATES 24
9.14. FAILURE TO FIX ASSESSMENTS 25
9.15. LIMITATIONS ON ASSESSMENTS 25
9.16. AUTOMATIC ASSESSMENT INCREASES 26
9.17. NOTICE OF ASSESSMENT INCREASE 27
9.18. REDUCTION OR ABATEMENT OF REGULAR ASSESSMENTS 27
9.19. NO OFFSETS 27
9.20. DELINQUENCIES; LATE PENALTIES; INTEREST ON
ASSESSMENTS 27
9.21. DEBT OF THE OWNER 27
9.22. ASSOCIATION POLICIES AND PRACTICES RE: DEFAULTS 27
9.22.1. ASSESSMENT DEFAULTS 27
9.22.2. MONETARY PENALTIES AND FEES 28
9.23. COLLECTION OF ASSESSMENTS; LIENS 28
9.23.1. RIGHT TO ENFORCE ASSESSMENTS 28
9.23.2. NOTICE TO OWNER PRIOR TO LIEN OF
ASSESSMENT 28
9.23.3. LIEN OF ASSESSMENT 29
9.23.4. NOTICE TO OWNER AFTER LIEN OF ASSESSMENT 29
9.23.5. PAYMENTS UNDER PROTEST 29
9.23.6. RELEASE OF LIEN 29
9.23.7. LIEN ENFORCEMENT; FORECLOSURE
PROCEEDINGS 30
9.24. ADDITIONAL CHARGES 30
9.24.1. ATTORNEY'S FEES 30
9.24.2. LATE CHARGES 30
9.24.3. COSTS OF SUIT 30
9.24.4. INTEREST 30
9.24.5. OTHER 30
9.25. PRIORITY OF THE LIEN 31
MAGNOLIA AT LA COSTA
DECLARATION iv
9.26. WAIVER OF EXEMPTIONS 31
9.27. TAXATION AGAINST THE ASSOCIATION AREA 31
9.28. PERSONAL LIABILITY OF OWNER 31
9.29. TRANSFER OF RESIDENTIAL LOT 31
9.30. FINANCIAL ACCOUNTS 32
9.31. USE OF RESERVE FUNDS 32
10. ANNEXATION 32
10.1. AUTOMATIC ANNEXATION BY CONVEYANCE OR LEASING OF
RESIDENTIAL LOT IN AN UNANNEXED PHASE 32
10.2. ANNEXATION WITHOUT CONVEYANCE OF RESIDENTIAL LOT 33
10.3. DECLARATION OF ANNEXATION 33
10.4. RIGHTS AND OBLIGATIONS OF OWNERS 33
10.5. MERGERS OR CONSOLIDATIONS 34
10.6. DE-ANNEXATION 34
11. USE RESTRICTIONS 34
11.1. USE OF RESIDENTIAL LOTS 34
11.2. LEASE OF DWELLING 35
11.2.1. REQUIREMENTS OF ALL LEASES 35
11.2.2. FAILURE OF TENANT TO COMPLY WITH PROJECT
DOCUMENTS; OTHER TENANT MATTERS 35
11.3. EXTERIOR COLORS 35
11.4. ACCESSORY BUILDINGS 35
11.5. REASONABLE CONSTRUCTION TIMEFRAME 36
11.6. SCREENDOORS; AWNINGS; WINDOWS 36
11.7. WINDOW COVERINGS 36
11.8. PETS 36
11.9. SIGNS 37
11.10. EXTERIOR LIGHTING 37
11.11. SOLAR ACCESS 37
11.12. ANTENNAS, SATELLITE DISHES 37
11.13. POST TENSION SLABS 38
11.14. OFFENSIVE ACTIVITIES AND CONDITIONS 38
11.15. GARBAGE AND REFUSE DISPOSAL 38
11.16. CLOTHESLINES 38
11.17. LANDSCAPING; VACANT LOTS 39
11.18. VEHICLE RESTRICTIONS 39
11.18.1. PROHIBITED VEHICLES 39
11.18.2. RESTRICTED VEHICLES 39
11.18.3. PERMITTED VEHICLES 39
11.18.4. CONSTRUCTION AND SALES 39
11.19. OFF-SITE STORAGE-RECREATIONAL VEHICLES 40
11.20. USE OF GARAGES; PARKING 40
11.21. TOWING 40
11.22. WELLS; SEPTIC TANKS 40
MAGNOLIA AT LA COSTA
DECLARATION
11.23. LIABILITY FOR DAMAGE TO ASSOCIATION AREA 40
11.24. RESTRICTIONS ON FURTHER SUBDIVISION 41
11.25. INDEMNIFICATION 41
12. ARCHITECTURAL AND DESIGN CONTROL 41
12.1. APPROVAL FOR ARCHITECTURAL AND DESIGN MATTERS 41
12.2. GENERAL 41
12.3. DUTIES 42
12.4. MEETINGS; VOTING; WRITTEN CONSENT 42
12.5. SCOPE 42
12.6. ARCHITECTURAL STANDARDS 42
12.7. APPROVAL OF PLANS & SPECIFICATIONS BY ARCHITECTURAL
COMMITTEE 43
12.8. PRELIMINARY APPROVAL 43
12.8.1. TIME PERIODS FOR REVIEW 43
12.8.2. EFFECTIVENESS OF APPROVAL 43
12.8.3. FINAL APPROVAL 43
12.8.4. TIME PERIODS FOR REVIEW 44
12.9. APPROVAL OF SOLAR ENERGY SYSTEMS 44
12.10. INSPECTION AND CORRECTION OF WORK 44
12.11. FAILURE TO NOTIFY 44
12.12. ENTRY INTO DWELLING 45
12.13. DILIGENCE IN CONSTRUCTION 45
12.13.1. FEE FOR REVIEW 45
12.14. INTERPRETATION 45
12.15. WAIVER 45
12.16. ESTOPPEL CERTIFICATE 45
12.17. LIABILITY 45
12.18. NON-APPLICABILITY TO DECLARANT; BUILDER 46
12.18.1. DECLARANT, BUILDER NON-APPLICABILITY 46
12.18.2. BUILDER REQUIREMENTS 46
12.19. GOVERNMENT REQUIREMENTS 46
12.20. AMENDMENTS 46
12.21. VARIANCES 46
13. DEVELOPMENT RIGHTS 47
13.1. LIMITATION OF RESTRICTIONS 47
13.2. RIGHTS OF ACCESS; COMPLETION; MARKETING 47
13.2.1. ACCESS 47
13.2.2. CONSTRUCTION IMPROVEMENTS 47
13.2.3. GRANT EASEMENTS 47
13.2.4. MARKETING RIGHTS :.. 48
(A) GENERAL RIGHTS 48
(B) AGREEMENT FOR EXTENDED USE 49
13.2.5. SIZE AND APPEARANCE OF PROJECT 49
13.3. ASSIGNABILITY OF RIGHTS 49
MAGNOLIA AT LA COSTA
DECLARATION vi
13.4. TERMINATION OF ANY RESPONSIBILITY OF DECLARANT 49
13.5. AMENDMENT 49
14. RESPONSIBILITIES OF MAINTENANCE 50
14.1. MAINTENANCE OBLIGATIONS OF OWNER 50
14.1.1. OVERALL MAINTENANCE OF RESIDENTIAL LOTS 50
14.1.2. DRAINAGE 50
14.1.3. MAINTENANCE OF FENCES OR WALLS 50
(A) OWNER MAINTENANCE OBLIGATIONS 50
(B) BETWEEN TWO RESIDENTIAL LOTS 50
(C) RESIDENTIAL LOT AND ASSOCIATION AREA 50
14.1.4. LANDSCAPING; SLOPES 51
14.2. OWNER'S FAILURE TO MAINTAIN; WILLFUL OR NEGLIGENT ACT... 51
14.3. RESPONSIBILITY OF ASSOCIATION 51
14.4. ASSUMPTION OF MAINTENANCE OBLIGATIONS 51
14.5. PROPERTY MANAGEMENT 51
15. INSURANCE 52
15.1. MASTER INSURANCE POLICY 52
15.1.1. LIABILITY INSURANCE 52
15.1.2. CASUALTY INSURANCE 52
15.1.3. COVERED CAUSE OF LOSS 52
15.1.4. PRIMARY 52
15.1.5. 53
15.1.6. ENDORSEMENTS 53
15.1.7. WAIVER OF SUBROGATION 53
15.1.8. DISHONEST ACTS; FIDELITY BOND 53
15.1.9. WORKERS COMPENSATION INSURANCE 53
15.1.10. OTHER INSURANCE 53
15.2. FNMA; FHLMC; INSTITUTIONAL MORTGAGEE 53
15.3. TEN (10) DAY CANCELLATION NOTICE 54
15.4. TRUSTEE; ADJUSTMENT OF LOSSES 54
15.4.1. TRUSTEE 54
15.4.2. ADJUSTMENT OF LOSSES 54
15.5. DUTY TO CONTRACT 54
15.6. OWNERS' INSURANCE 54
15.7. FAILURE TO ACQUIRE 54
15.8. PERIODIC REVIEW OF POLICIES 55
15.9. DISTRIBUTION TO MORTGAGEES 55
15.10. INSPECTION OF POLICIES 55
15.11. INSURANCE INFORMATION TO MEMBERS 55
16. DAMAGE OR DESTRUCTION 55
16.1. RESTORATION DEFINED 55
MAGNOLIA AT LA COSTA
DECLARATION vii
16.2. INSURED CASUALTY 55
16.3. RESTORATION PROCEEDS 56
16.4. REBUILDING CONTRACT 56
16.5. MINOR REPAIR AND RECONSTRUCTION 56
16.6. BOARD'S ACTION 57
16.7. DAMAGE TO DWELLINGS 57
17. CONDEMNATION: EMINENT DOMAIN. 57
17.1. CONDEMNATION OF ASSOCIATION AREA PORTIONS OF
RESIDENTIAL LOTS 57
17.2. CONDEMNATION OF A RESIDENTIAL LOT 57
18. RIGHTS OF MORTGAGEES 58
18.1. CONFLICT 58
18.2. MORTGAGEE PROTECTION 58
18.3. LIABILITY FOR UNPAID ASSESSMENTS AND COMMON
EXPENSES 58
18.4. PAYMENT OF TAXES AND INSURANCE 58
18.5. AGREEMENT FOR MANAGEMENT 59
18.6. NOTIFICATION TO ELIGIBLE MORTGAGEE HOLDER 59
18.7. NO RIGHT OF FIRST REFUSAL 59
18.8. ACTION REQUIRING MORTGAGEE APPROVAL 59
18.9. PRIORITY OF PROCEED OR AWARD DISTRIBUTION 60
18.10. INSPECTION OF PROJECT DOCUMENTS, BOOKS AND RECORDS.. 60
18.11. SELF-MANAGEMENT 60
18.12. VOTING RIGHTS ON DEFAULT 60
18.13. NON-CURABLE BREACH 61
18.14. LOAN TO FACILITATE 61
18.15. DOCUMENTS TO BE MADE AVAILABLE 61
18.16. MORTGAGEES FURNISHING INFORMATION 61
18.17. FINANCIAL STATEMENT 61
18.18. TERMINATION WITHOUT SUBSTANTIAL DESTRUCTION 62
19. AMENDMENTS 62
19.1. AMENDMENT PRIOR TO FIRST CONVEYANCE 62
19.2. AMENDMENTS AFTER FIRST CONVEYANCE 62
19.3. AMENDMENTS FOR TECHNICAL ERRORS, CLARIFICATION AND
CHANGES IN LAW 64
19.4. APPROVAL BY FHA AND VA 64
19.5. RELIANCE ON AMENDMENTS 64
20. ENFORCEMENT; DISPUTE RESOLUTION 64
20.1. CONSTRUCTION DEFECT DISPUTE RESOLUTION 64
MAGNOLIA AT LA COSTA
DECLARATION viii
20.1.1. DECLARANT NOTICE 65
20.1.2. RIGHT TO INSPECT AND RIGHT TO CORRECTIVE
ACTION 65
20.2. OTHER DISPUTE RESOLUTION 65
20.3. MEDIATION 65
20.4. JUDICIAL REFERENCE 66
20.5. CIVIL CODE SECTION 1354 67
20.6. FAILURE TO ENFORCE 67
20.7. VIOLATION OF LAW 68
20.8. MEETING AND NOTICE TO MEMBERS PRIOR TO CERTAIN LEGAL
ACTIONS BY THE BOARD 68
20.8.1. DEFINITION OF "SIGNIFICANT LEGAL PROCEEDING.".. 68
20.8.2. INAPPLICABILITY OF PROVISIONS; POWER TO TAKE
ACTION 69
20.9. PREREQUISITES TO ASSOCIATION'S ACTION(S) AGAINST
DECLARANT AND OTHERS 70
20.10. ASSOCIATION CLAIMS 70
21. GENERAL PROVISIONS 70
21.1. SEVERABILITY 70
21.2. EXTENSION OF DECLARATION 70
21.3. NOTICE 71
21.4. CIVIL CODE SECTION 1368 71
21.5. NOTIFICATION OF SALE OR CONVEYANCE 71
21.6. UNANNEXED PHASES - ENCUMBRANCE OF DECLARATION 71
21.7. MERGERS OR CONSOLIDATIONS 72
21.8. EASEMENTS RESERVED AND GRANTED 72
21.9. GOVERNING DOCUMENTS 72
21.10. SINGULAR INCLUDES PLURAL 72
21.11. LIBERAL CONSTRUCTION 72
22. CITY OF CARLSBAD REQUIREMENTS. 73
22.1. GENERAL ENFORCEMENT BY CITY 73
22.2. NOTICE AND AMENDMENT 73
22.3. FAILURE OF ASSOCIATION TO MAINTAIN COMMON AREA LOTS
AND EASEMENTS 73
22.4. SPECIAL ASSESSMENTS LEVIED BY THE CITY 73
23. EXHIBIT "A" - LEGAL DESCRIPTION 76
24. EXHIBIT "B" - ASSOCIATION MAINTAINED LANDSCAPE
AREAS 77
MAGNOLIA AT LA COSTA
DECLARATION ix
THIS DECLARATION is made on the day and year hereinafter written by KEYSTONE
LA COSTA LLC, A CALIFORNIA LIMITED LIABILITY COMPANY, hereinafter called
"Declarant," with reference to the following:
1. RECITALS
1.1. PROPERTY OWNED BY DECLARANT.
Declarant is the owner of the real property located in the in the City of Carlsbad,
County of San Diego, State of California, more particularly described on Exhibit "A" attached
hereto and by this reference made a part hereof, hereafter referred to herein as the "Property."
1.2. PURPOSE OF DECLARATION; NATURE OF PROJECT.
This Declaration is intended to establish the Property on a phased incremental
basis as a "Common Interest Development" pursuant to the provisions of the Davis-Stirling
Common Interest Development Act, more particularly described in California Civil Code Section
1351(k) as a "planned development" (the "Project"), and to subject the to certain limitations,
covenants, conditions and restrictions as hereinafter set forth. To that objective, Declarant
desires and intends to impose on the Property mutually beneficial restrictions, limitations,
easements, assessments and liens under a comprehensive plan of improvement and
development for the use and management of the Property as a community called "MAGNOLIA
AT LA COSTA" (the "Community"); and for the purpose of enhancing and protecting the
value, desirability and attractiveness of the Property for the benefit of all Owners and occupants
thereof.
1.3. DESCRIPTION OF PROJECT:
1.3.1. NUMBER OF RESIDENTIAL LOTS.
The Project is intended to ultimately consist of twenty-eight (28)
"Residential Lots" shown on the Map described in EXHIBIT "A" as Lots 1 through 25 and
Lots 27 through 29, inclusive.
1.3.2. ASSOCIATION AREA.
In addition to the Residential Lots the Project will include
Association Area, consisting of the following: (a) three (3) Association Lots, shown on the
Map described in EXHIBIT "A": Lot 26, which is intended for passive recreational use, and
Lots 30 and 31, which shall consist of private streets; (b) Easement Property consisting of
certain Slope Easements over (i) the rear yard portions of certain Residential Lots, and (ii) over
a portion of that certain real property described in Exhibit "B," located adjacent to the western
boundary of the Property. The Association shall have a duty and obligation to maintain, repair
and/or replace the improvements located within the Association Area, in accordance with the
provisions therefor contained in this Declaration or as may be described in another instrument
recorded with the County Recorder, or as may be required by the City pursuant to its City
Resolution described in Section 3.16 herein.
MAGNOLIA AT LA COSTA
DECLARATION 1 CCRS-BY-AOI-DS.DOC
1.4. PLAN OF DEVELOPMENT.
The Property is or shall be: (a) subject to a plan of development of residential
lots pursuant to the City Resolution described in Section 3.16 herein, and, (b) consistent with
any overall development plans submitted to and approved by the ORE.
1.5. PHASING.
1.5.1. PUBLIC REPORT; PHASE.
This Declaration is further intended that the Residential Lots within
the Property be developed, offered for sale to the general public or otherwise conveyed in two
(2) or more incremental phases ("Phase"), each of which shall be evidenced by a separate
Final Subdivision Public Report ("Public Report") issued by the ORE designating certain
Residential Lots therein as comprising a separate "Phase."
1.5.2. PHASE RECONFIGURATION.
The foregoing notwithstanding, Declarant shall have the express
right to reconfigure any Phase owned by amending the Public Report covering such Phase.
Any such reconfiguration may include, but not limited to, the quantity and designation of the
Residential Lots, and/or any other areas or interests (e.g. easements) included in a Phase. Any
such Phase reconfiguration and amendment to a Public Report shall effect a corresponding
modification of any rights related thereto within this Declaration and the other Project
Documents.
1.5.3. BUYERS' ACKNOWLEDGMENTS RELATING TO
PHASING.
Anything herein to the contrary notwithstanding, each Person who
acquires title to a Residential Lot or any other portion of the Property, hereby acknowledges by
acceptance of deed or other title conveying instrument to a Residential Lot or other portion of
the Property, that: Declarant makes no any guarantee whatsoever of: (a) the number of
Residential Lots to be developed in any Phase of the Property whatsoever, (b) the number of
current or future Phases of development of the Property, (c) that any residential lot shall be sold
or leased, and/or (d) that any portion of the Property will, in fact, become a part of the Project.
1.6. BUYERS' ACKNOWLEDGEMENTS REGARDING WASTEWATER
RECLAMATION FACILITY.
Each Person who acquires title to a Residential Lot or any other portion of the
Property, hereby acknowledges by acceptance of deed or other instrument conveying legal title
or interest to or in a Residential Lot or any other portion of the Property that the Vallecitos Water
District maintains a Wastewater Reclamation Facility adjacent to the Property (Carlsbad Tract
No. 96-04). This facility has been in operation since 1961 and. as of the approximate date of
Recordation of this Declaration, treats 2.25 million gallons per day of wastewater. An expansion
to 3.6 million gallons per day is anticipated within one to three years following the Recordation
of this Declaration, which shall expand to at least 5 million gallons per day by the year 2015.
MAGNOLIA AT LA COSTA
DECLARATION 2 CCRS-BY-AOI-DS.DOC
1.7. ESTABLISHMENT OF ASSOCIATION.
Declarant will cause or has caused the incorporation of the MAGNOLIA AT LA
COSTA OWNERS ASSOCIATION, a California nonprofit mutual benefit corporation (the
"Association"}, organized under the Nonprofit Mutual Benefit Corporation Law (California
Corporations Code Sections 7110 et seq.), for the purpose of exercising the powers and
functions set forth herein. The Association shall act as the management body for the
Community, and shall be responsible for the maintenance, repair and replacement of the
Association Area. By virtue of owning a Residential Lot in the Project, each Owner shall have a
membership in the Association, which membership shall be appurtenant to and pass with title to
the Residential Lot.
2. DECLARATION
NOW, THEREFORE, Declarant hereby certifies and declares that all of the Property is,
and shall be, held, conveyed, transferred, hypothecated, encumbered, leased, rented, used,
occupied and improved, subject to the limitations, covenants, conditions, restrictions,
easements, liens and charges hereinafter set forth, all of which are for the purpose of uniformly
enhancing, maintaining and protecting the value, attractiveness and desirability of the Property,
in furtherance of a general plan of ownership as described in California Civil Code Section 1350
et seq., or any successor statutes or laws for the subdivision, protection, maintenance,
improvement, sale and lease of the Property, or any portion thereof. All of the limitations,
covenants, conditions, restrictions, easements, liens and charges set forth herein shall run with
the land, shall be binding upon and inure to the benefit of all parties having or acquiring any
right, title or interest in the Property, or any part thereof, their heirs, successive owners and
assigns, shall be enforceable equitable servitudes and shall binding on and inure to the benefit
of every portion of the Property and any interest therein, including Declarant, its successive
owners and each Owner and his or her respective successors-in-interest, and may be enforced
by any Owner or by the Association.
3. DEFINITIONS
3.1. ADJACENT PROPERTY.
"Adjacent Property" shall mean and refer to that certain real property located
adjacent to the western boundary of the Property, over which a Slope Maintenance Easement
has been or will be granted and/or assigned to the Association, pursuant and subject to the
terms, provisions, conditions and restriction of that certain document recorded with the County
Recorder on as Document No.
3.2. ANNEXED.
"Annexed" shall mean and refer to the initial conveying of a Residential Lot in a
Phase to a Retail Buyer by Declarant,
MAGNOLIA AT LA COSTA
DECLARATION 3 CCRS-BY-AOI-DS.DOC
3.3. ANNEXED PHASE.
"Annexed Phase" shall mean and refer to (a) the first Phase in the Property upon
the conveyance of the first Residential Lot therein by Declarant to a Retail Buyer, and (b) any
subsequent Phase after the first Annexed Phase: (i) in which at least one Residential Lot has
been conveyed by Declarant to a Retail Buyer under the authority of a Public Report, or (ii) in
which at least one Residential Lot and a Dwelling located thereon is leased by Declarant or its
successor in interest under the authority of a Public Report, or (iii) for which Declarant records
an "Annexation Instrument" declaring that an Unannexed Phase is annexed to the Project
and the Association under the authority of a Public Report, whereafter each such Phase shall
become fully subject to all of the terms, conditions and restrictions contained in this Declaration,
and assessments shall commence in accordance with the provisions therefor contained herein.
3.4. ANNEXED PROPERTY.
"Annexed Property" shall mean that portion or portions of the Property consisting
of (a) Association Lots 26, 30 and 31 upon their respective conveyance to the Association,
and(b) each Annexed Phase.
3.5. ARCHITECTURAL COMMITTEE.
"Architectural Committee" shall mean and refer to the Board, unless the Board
specific delegates its authority to act as the Architectural Committee pursuant to the Article
herein entitled ARCHITECTURAL AND DESIGN CONTROL.
3.6. ARCHITECTURAL STANDARDS.
"Architectural Standards" shall mean and refer to the design criteria adopted by
the Architectural Committee pursuant to the provisions of Article 12 herein.
3.7. ARTICLES.
"Articles" shall mean and refer to the Articles of Incorporation, including such
amendments thereto as may from time to time be made, which are or shall be filed in the Office
of the Secretary of State for the State of California,
3.8. ASSOCIATION; HOMEOWNERS ASSOCIATION.
"Association" or "Homeowners Association" shall mean and refer to the
MAGNOLIA AT LA COSTA OWNERS ASSOCIATION, a California non-profit mutual benefit
corporation, incorporated under the Non-Profit Mutual Benefit Laws of the State of California, its
successors and assigns.
3.9. ASSOCIATION AREA.
"Association Area" shall mean and refer to any real property or interests in real
property that is either owned by the Association or for which the Association has a duty,
obligation and responsibility to maintain, repair and replace, including but not limited to
(a) Association Lots, and (b) Slope Maintenance Easements, all described more fully herein.
MAGNOLIA AT LA COSTA
DECLARATION 4 CCRS-BY^OI-DLDOC
3.10. ASSOCIATION EASEMENT(S).
"Association Easement(s)" shall mean and refer to the Slope Maintenance
Easements or any one of them as they may encumber a Residential Lot or the Adjacent
Property, and/or any other easement granted to the Association, which grant includes a duty
and/or obligation for the Association to maintain, repair and/or replace all or certain
improvements located within such respective easement.
3.11. ASSOCIATION LOT(S).
"Association Lot(s)" shall mean and refer to Lots 26, 30 and 31, as shown on the
Map, or any one of them, upon each such Lot's respective conveyance to the Association.
3.12. ASSOCIATION PROPERTY.
"Association Property" shall mean and refer to any non-real property,
improvements, facilities, betterments and/or personalty owned or leased by the Association.
3.13. BOARD.
"Board" shall mean and refer to the Board of Directors of the Association.
3.14. BYLAWS.
"Bylaws" shall mean and refer to the Bylaws of the Association, including such
amendments thereto as may from time to time be made.
3.15. CITY.
"City" shall mean and refer to the City of Carlsbad, a municipal corporation
located in the County of San Diego, State of California.
3.16. CITY RESOLUTION.
"City Resolution" shall mean and refer to that certain City of Carlsbad City
Council Resolution No. 97-595 adopted by the City Council on September 2, 1997, and any
amendment thereto.
3.17. COMMON EXPENSES.
"Common Expenses" shall mean and refer to the actual and estimated costs and
expenses incurred or to be incurred by the Association, including, but not limited to:
(a) Maintenance, management, operation, repair and replacement of the
Association Area,, pursuant to the terms of this Declaration;
(b) Costs and expenses not paid by the Owner responsible for payment,
when such costs and expenses are paid by the Association;
(c) Maintenance by the Association of areas within the public right-of-way of
public streets in the vicinity of the Community as provided in this Declaration or pursuant to
agreements with the City, if any,
MAGNOLIA AT LA COSTA
DECLARATION 5 ccRS-BY-AOi-D3.DOC
(d) Costs of management and administration of the Association, including,
but not limited to, compensation paid by the Association to managers, accountants, attorneys
and employees;
(e) Costs of utilities, trash pickup and disposal, gardening and other services
benefiting the Owners and their property to the extent such services are paid for by the
Association;
(f) The costs of fire, casualty, liability, worker's compensation and other
insurance covering the Association Area, to the extent such insurance and coverage is
available;
(g) The costs of any other insurance obtained by the Association pursuant to
the provisions of this Declaration;
(h) Reasonable reserves as deemed appropriate by the Board;
(i) The costs of bonding of the Members of the Board or its delegated
committees, any professional managing agent or any other person handling the funds of the
Association;
(j) Taxes paid by the Association;
(k) Amounts paid by the Association for the discharge of any lien or
encumbrance levied against the Association Areas or portions thereof;
(I) Costs incurred by the Board, the Architectural Committee or any
committee delegated by the Board;
(m) The costs of any other item or items designated by, or in accordance with
other expenses incurred by the Association for any reason whatsoever in connection with the
operation or maintenance of the Association Area or in furtherance of the purposes or the
discharge of any obligation imposed on the Association by this Declaration or other Project
Documents.
3.18. COMMUNITY.
"Community" shall mean and refer to all of the Property which is, from time to
time, subject to this Declaration.
3.19. COUNTY.
"County" shall mean and refer to the County of San Diego, California.
3.20. COUNTY RECORDER.
"County Recorder" shall mean and refer to the San Diego County Recorder.
County of San Diego, California.
MAGNOLIA AT LA COSTA
DECLARATION 6 CCRS-BY-AOI-DS.DOC
3.21. DECLARANT.
"Declarant" shall mean and refer to KEYSTONE LA COSTA LLC, A
CALIFORNIA LIMITED LIABILITY COMPANY, its successors and assigns, if such successors
or assigns acquire any or all of the Declarant's interest in the Property for the purpose of
development or sale. A successor Declarant shall also be deemed to include the beneficiary
under any deed of trust securing an obligation from a then existing Declarant encumbering all or
any portion of the Property, which beneficiary has acquired any such property by foreclosure,
power of sale or deed in lieu of such foreclosure or sale.
3.22. DECLARATION.
"Declaration" shall mean and refer to this Declaration of Covenants,
Conditions and Restrictions for "MAGNOLIA AT LA COSTA," recorded with the Office of
the County Recorder of San Diego County, California, covering the Property, including such
amendments thereto as may from time to time be recorded.
3.23. DWELLING; RESIDENCE.
"Dwelling" or "Residence" shall mean a residential structure or structures,
including, balconies, patio areas, walkways, driveways and garages located on a Residential
Lot.
3.24. EASEMENT PROPERTY; SLOPE EASEMENTS; SLOPE AREA.
"Easement Property," "Slope Easements" and/or "Slope Area" shall mean and
refer those portions of Residential Lots 1 through 14, inclusive, and Residential Lots 20 and
21, as shown on the Map by the designation "Slope Maintenance By Homeowner's
Association; Provide Slope Maintenance Easement" for which the Association shall have a duty
and obligation to maintain, repair and/or replace the all slopes, landscaping and improvements
therein, including, but not limited to, irrigation lines, drainage facilities and Project identification
signs or monuments, in accordance with the terms and provisions contained in that certain
"Grant of Easement and Maintenance Agreement" recorded with the County Recorder on
Me*/. 7^ . 19^ as Document No. iW'O73&g63 (see: "Slope Easement
Agreement").
3.25. ELIGIBLE INSURER, GUARANTOR.
"Eligible Insurer" and "Eligible Guarantor" shall mean and refer to an insurer or
governmental guarantor who has provided a written request to the Association, to be notified of
those matters which such holder is entitled to notice of by reason of this Declaration or the
Bylaws of the Association.
3.26. ELIGIBLE MORTGAGE HOLDER.
"Eligible Mortgage Holder" shall mean and refer to the holder of a first mortgage
or deed of trust on a Residential Lot, who has provided a written request to the Association, to
be notified of those matters which such holder is entitled to notice of by reason of this
Declaration or the Bylaws of the Association. Such notice must contain the Residential Lot
number or the street address of the secured Residential Lot.
MAGNOLIA AT LA COSTA
DECLARATION 7 ccRs-BY-Aoi-D3.Doc
3.27. EMERGENCY.
"Emergency" shall mean and refer to an unforeseen occurrence or condition
calling for immediate action to avert imminent danger to life, health, or property.
3.28. FHLMC.
"FHLMC" shall mean and refer to the Federal Home Loan Mortgage Corporation.
3.29. FIRST MORTGAGE.
"First Mortgage" shall mean and refer to a Mortgage which has priority under the
recording statutes of the State of California over all other Mortgages encumbering a specific
Residential Lot in the Project. First Mortgage shall also mean and refer to a First Deed of Trust
as well as a First Mortgage.
3.30. FIRST MORTGAGEE.
"First Mortgagee" shall mean and refer to the Mortgagee of a First Mortgage.
3.31. FNMA.
"FNMA" shall mean and refer to the Federal National Mortgage Association.
3.32. IMPROVEMENT(S).
"Improvement(s)" shall mean and refer to any buildings, structures or
improvements of any type or kind constructed within the Project.
3.33. INSTITUTIONAL MORTGAGEE.
"Institutional Mortgagee" shall mean and refer to a First Mortgagee which is (a) a
bank, savings and loan association, insurance or mortgage company or other entity or institution
chartered under federal and/or state law; (b) an insurer or governmental guarantor of a First
Mortgage; (c) any Federal or State agency; (d) the State of California as the vendor under an
installment land sales contract covering a Residential Lot; or (e) any other institution specified
by the Board in a recorded instrument, who is the Mortgagee of a Mortgage or the beneficiary of
a Deed of Trust encumbering a Residential Lot.
3.34. INVITEE.
"Invitee" shall mean and refer to any person whose presence within the Project is
approved by or is at the request of a particular Owner, including, but not limited to, lessees,
tenants and the family, guests, employees, licensees or invitees of Owners, tenants or lessees.
3.35. MAP; SUBDIVISION MAP.
"Map" or "Subdivision Map" shall mean and refer to that certain Subdivision Map
filed in Office of the County Recorder of San Diego County, as more particularly described in
EXHIBIT "A".
MAGNOLIA AT LA COSTA
DECLARATION 8 CCRS-BY-AOI-DJ.DOC
3.36. MEMBER.
"Member" shall mean and refer to a Person who holds a membership in the
Association as provided herein. Membership shall be appurtenant to and may not be separated
from ownership of a Residential Lot.
3.37. MORTGAGE.
"Mortgage" shall mean and refer to a deed of trust as well as a mortgage.
3.38. MORTGAGEE.
"Mortgagee" shall mean and refer to a beneficiary or a holder of a deed of trust
as well as a mortgagee.
3.39. MORTGAGOR.
"Mortgagor" shall mean and refer to the trustor of a Deed of Trust as well as a
mortgagor.
3.40. NOTICE AND HEARING.
"Notice and Hearing" shall mean and refer to the procedure that gives an Owner
notice of an alleged violation of the Project Documents and the opportunity for a hearing before
the Board, as more fully described in the Article herein entitled RIGHTS OF OWNERS.
3.41. OWNER.
"Owner" shall mean and refer to the record Owner, whether one (1) or more
persons or entities, of fee simple title to a Residential Lot. The term "Owner" shall include a
seller under an executory contract of sale, but shall exclude Mortgagees.
3.42. PERSON.
"Person" shall mean a natural individual, a corporation or any other entity with
the legal right to hold title to real property, including a leasehold interest.
3.43. PHASE.
"Phase" shall mean and refer to an increment of development and/or sales
sequence of the Residential Lots in the Property for which a separate Public Report has been
issued by the ORE for all of the Residential Lots located within that increment; the term "Phase"
shall include all Residential Lots located within such Phase, as well as any Association Area
therein. The development, sale and leasing of Residential Lots and Dwellings thereon in each
Phase shall be at the sole discretion of Declarant, and there is no assurance (or obligation on
the part of Declarant) that the proposed subsequent Phases will be completed or that any a
Residential Lot shall be sold or leased.
MAGNOLIA AT LA COSTA
DECLARATION 9 CCRS-BY-AOI-DS.DOC
3.44. PRIVATE STREET(S); PRIVATE ROAD(S).
"Private Street(s)" and/or "Private Roads" shall mean and refer to those private
streets shown on the Map as Lot 30 (Via Borregos and Corte Terral) and Lot 31 (an
unnamed driveway). References in this Declaration and the other Project Documents to the
respective Private Streets, may include the term "Private Road" or "Private Street" followed by
the name of the respective private street within the Project. The term Private Street/Road shall
include, but not be limited to, road surfaces, roadbeds, adjacent roadside, walks, curbs, gutters,
above and below surface drainage facilities, striping, markers, landscaping and sprinkler system
and water lines in the shoulder of said road and street lighting, if any. Pursuant to the plan of
development submitted to the ORE, title to each of respective Private Street Lots 30 and 31
shall be conveyed by Declarant to the Association in accordance with the provisions therefor
contained in the Public Report in which each such Association Lot is designated.
3.45. PROJECT.
"Project" shall mean and refer to (a) all Residential Lots located within an
Annexed Phase, and (b) the Association Area.
3.46. PROJECT DOCUMENTS.
Project Documents" means and includes this Declaration, the exhibits, if any,
attached thereto, the Articles, the Bylaws, any Rules established by the Board, as well as any
other agreements, easements and similar instruments that encumber the Property or any
portion thereof, as relating to the interests, duties, obligations, conditions, restrictions,
covenants between and/or among the Owner, including the Association. The foregoing shall
also include any amendments to the aforedescribed documents as may from time to time be
made.
3.47. PROPERTY.
"Property" shall mean and refer to that certain real property located in the City of
Carlsbad, San Diego County, California, more particularly described in Exhibit "A" hereto.
3.48. PUBLIC REPORT.
"Public Report" shall mean and refer to the Final Subdivision Public Report
issued by the California Department of Real Estate covering the Project, which provides
disclosure of material facts for the Project..
3.49. PUBLIC STREET(S).
"Public Street(s)" shall mean and refer to those streets shown and dedicated to
the public on the Map or by other legal instrument.
3.50. RECORD; RECORDED; RECORDATION.
"Record," "Recorded," and/or "Recordation" shall mean and refer to, with respect
to any document, the recordation or filing of such document with the County Recorder.
MAGNOLIA AT LA COSTA
DECLARATION 10 CCRS-BY-AOI-DS.OOC
3.51. RESIDENTIAL LOT; LOT.
"Residential Lot" or "Lot" means any of the lots located within the Project,
including all improvements now or hereafter thereon.
3.52. RETAIL BUYER.
"Retail Buyer" shall mean and refer to a Person who purchases a Residential Lot
from Declarant for purposes of owning a Residential Lot and any and all improvements located
thereon, whether such improvements are existing or proposed.
3.53. RULES.
"Rules" shall mean and refer to any rules or regulations adopted by the
Association or its Board pursuant to this Declaration.
3.54. SLOPE EASEMENT AGREEMENT.
"Slope Easement Agreement" shall mean and refer to that certain "Grant of
Easement and Maintenance Agreement" recorded with the County Recorder on /lM 2- .
19^ as Document No. j^Tn*"O75Zo&3 . by which the Association is granted an
easement over the Easement Property located within the boundaries of Residential Lots 1
through 14, inclusive, and Residential Lots 20 and 21.
3.55. SUBDIVISION MAP: MAP.
"Subdivision Map" or "Map" shall mean and refer to that certain Subdivision Map
filed in Office of the County Recorder of San Diego County, as more particularly described in
Exhibit "A."
3.56. UNANNEXED PHASE.
"Unannexed Phase" shall mean and refer to a Phase of the Property in which no
Residential Lot has been conveyed from Declarant to a Retail Buyer.
3.57. OWNERSHIP OF RESIDENTIAL LOTS
Title to each Residential Lot in the Project shall be conveyed in fee to an Owner.
Ownership of each Residential Lot within the Project shall include a membership in the
Association.
4. EASEMENTS
The ownership interests in the Residential Lots described in this Article are subject to the
easements granted and reserved in this Declaration. Each of the easements reserved or
granted herein shall be deemed to be established upon the recordation of this Declaration and
shall thenceforth be deemed to be covenants running with the land for the use and benefit of the
Owners and their Residential Lots superior to all other encumbrances applied against or in favor
MAGNOLIA AT LA COSTA
DECLARATION 11 CCRS-BY-AOI-DJ.DOC
of any portion of the Project. Individual grant deeds to Residential Lots may, but shall not be
required to set forth the easements specified in this Article.
4.1. EASEMENTS FOR ASSOCIATION AREA.
Every Member of the Association shall have a non-exclusive easement of
access, ingress, egress, use and enjoyment of, in, to and over the Association Area to the
extent and subject to the limitations described herein and in the other Project Documents; such
easement shall be appurtenant to and shall pass with title to every Residential Lot in the Project,
subject to the rights and restrictions set forth herein and in the other Project Documents.
4.1.1. SUSPEND RIGHTS OF MEMBERS.
The Board shall have the right, after Notice and Hearing, to
temporarily suspend an Owner's rights as a Member pursuant to the terms of this Declaration.
4.1.2. DEDICATE OR GRANT EASEMENTS.
The Association shall have the right to dedicate and/or grant
easements over all or any portion of the Association Area.
4.1.3. PERFORM ASSOCIATION FUNCTIONS.
There is hereby reserved by Declarant for the benefit of Declarant,
its successors and assigns, and its duly authorized agents and representatives, and granted to
the Association, and its duly authorized agents and representatives, such easements as are
necessary to perform the duties and obligations of the Declarant and/or the Association, as the
case may be, as are set forth in this Declaration and the other Project Documents, including the
Association Rules and/or Architectural Standards, and to perform any obligations not performed
by the Owner pursuant to the terms of this Declaration and the other Project Documents.
Subject to a concomitant obligation to restore, Declarant and its sales agents, employees and
independent contractors shall also have the easements described in the Article herein entitled
DEVELOPMENT RIGHTS.
4.1.4. EASEMENT TO DECLARANT AND BUILDER(S) FOR
ACCESS TO UNANNEXED PHASES AND ADDITIONAL
PROPERTY.
Declarant shall have and hereby expressly reserves a non-
exclusive easement over and across the Association Areas for ingress, egress and access to
and from any Additional Property owned thereby, until all of said Additional Property is annexed
to the Project, Dwellings are constructed thereon, and Notices of Completion (or comparable
instruments) issued respectively therefor.
4.2. SLOPE EASEMENT.
The Association is obligated and responsible for the maintenance, repair and
replacement of the Easement Property located within the boundaries of Residential Lots 1
through 14 inclusive, and Residential Lots 20 and 21, pursuant to the terms and provisions of
the Slope Easement Agreement.
MAGNOLIA AT LA COSTA
DECLARATION 12 CCRS-BY-AOI-DJ.DOC
4.3. DRAINAGE; SLOPES.
(a) Except in an Emergency, the Owner of any Residential Lot shall not in
any way interfere with (i) any portion of a Slope Easement Area located within the boundaries of
his or her Residential Lot; (ii) any established slopes within the non-Slope Area Easement areas
of his or her Residential Lot; and/or (iii) the established surface drainage pattern over his or her
Residential Lot from adjacent or adjoining Residential Lots or any Slope Easement Area. For
the purpose herein, "established surface drainage" and "established slopes" are defined as the
respective drainage and slopes that existed at the time of the filing of the Notice of Completion
(or similar instrument) relating to such Residential Lot or Dwelling thereon (whichever is later),
or if no such instrument exists, then at the time that the overall grading was completed for the
Phase or other appropriate development increment in which the Residential Lot is located.
(b) Notwithstanding anything herein to contrary, subject to written approval
as may be required by the Architectural Committee, there are reserved and granted for the
benefit of each Residential Lot, as dominant tenement, over, under, across and though the
Association Area and each other Residential Lot, as servient tenement, a non-exclusive
easement to slopes, drainageways and drainage facilities located within such servient
tenements, when such access is essential for the maintenance of non-Slope Maintenance
Easement Area slopes, or Residential Lot drainageways and/or drainage facilities, in order to
assure (i) the permanent stabilization and support of slopes and/or (ii) proper operation of
drainageways and/or drainage facilities located on the dominant tenement Residential Lot.
4.4. OWNERS' RIGHTS, DUTIES AND EASEMENTS FOR UTILITIES.
(a) There are reserved and granted for the benefit of each Residential Lot, as
dominant tenement, over, under, across and through the Project (including the Association Area
and each other Residential Lot), as the servient tenement, non-exclusive easements for utility
services. "Utility services" shall mean and refer to any utility facilities, such as electricity, water,
gas, cable television, sanitary sewer lines and facilities and drainage facilities.
(b) Whenever utility services that serve a dominant tenement Residential Lot
are installed within the servient tenement Association Area or Residential Lots, the Owner of the
dominant tenement Residential Lot served by said utility facilities shall have the right of
reasonable access for themselves or for utility companies or the City to repair, replace and
generally maintain said utility facilities as and when the same may be necessary.
(c) Whenever utility services are installed within the Project which serve
more than one (1) Residential Lot, the Owner of each Residential Lot served by the utility
facilities shall be entitled to the full use and enjoyment of such portions of the utility services as
service his or her Residential Lot. In the event of a dispute between Owners with respect to the
repair or rebuilding of the utility facilities, or with respect to the sharing of the cost thereof, then,
upon written request to the Association by one (1) of such Owners, the matter shall be
submitted to the dispute resolution procedures contained in the Article herein entitled
"ENFORCEMENT; DISPUTE RESOLUTION."
MAGNOLIA AT LA COSTA
DECLARATION 13 ccRs-BY-Aoi-Da.ooc
4.5. OBSTRUCTION OF VIEW OR LIGHT; NO VIEW OR LIGHT
EASEMENTS; OWNER ACKNOWLEDGMENT.
(a) Each Owner, by accepting a deed to a Residential Lot or any other
portion of the Property, hereby acknowledges the following: (a) that the view or "line of sight"
from, or any incoming light to any and all locations of such Owner's Residential Lot and/or
Dwelling at the time such Residential Lot was originally offered for sale to the public or to any
Builder prior to sale to the public (if applicable), or at any time after the conveyance of such
Residential Lot, may be subject to subsequent obstruction as a result of future construction or
plantings by Declarant, other property owners, or, by natural forces of nature and acts of God, in
the vicinity of or otherwise affecting each such Residential Lot or other portion of the Property;
and (b) that there are no view or light easements granted or reserved in favor of such Owner's
Residential Lot or other portions of the Property being or becoming a "dominant tenement"
thereof.
4.6. DECLARANT'S NON-EXCLUSIVE EASEMENTS.
Subject to a concomitant obligation to restore, Declarant and its sales agents,
employees and independent contractors shall have the easements described in the Article
herein entitled "DEVELOPMENT RIGHTS."
4.7. DECLARATION SUBJECT TO EASEMENTS.
Notwithstanding anything herein expressly or implied to the contrary, this
Declaration shall be subject to all easements theretofore or hereafter granted by the
Association, Declarant and/or any Builder for the installation and maintenance of utilities and
drainage facilities that are necessary for the Project, and to all easements shown on the Map.
5. THE ASSOCIATION
5.1. THE ORGANIZATION.
The Association is a nonprofit mutual benefit corporation formed under the
Nonprofit Mutual Benefit Law of the State of California. Subject to the provisions of the Section
next following entitled "Commencement of Association Business," upon the conveyance of
the first Residential Lot to a Retail Buyer, the Association shall be charged with the duties and
invested with the powers set forth in the Articles, the Bylaws and this Declaration.
5.2. COMMENCEMENT OF ASSOCIATION BUSINESS.
The Association shall commence business at such time that a Board of
Directors has been elected pursuant to the provisions therefor contained in the Bylaws.
MAGNOLIA AT LA COSTA
DECLARATION 14 CCRS-BY-AOI-D3.DOC
6. MEMBERSHIP, VOTING. FIRST MEETING
6.1. MEMBERSHIP IN GENERAL.
Every Owner of a Residential Lot shall be a Member of the Association.
Membership shall be appurtenant to and may not be separated from ownership of any Lot.
Membership in the Association shall not be transferred, pledged or alienated in any way, except
upon the sale of the Residential Lot to which it is appurtenant, and then only to the purchaser.
The transfer of title to a Residential Lot or the sale of a Lot and transfer of possession thereof to
the purchaser shall automatically transfer the membership appurtenant thereto to the transferee.
As a Member of the Association, each Owner is obligated to promptly, fully and faithfully comply
with and conform to the Articles, this Declaration, the Bylaws, the Architectural Standards, and
the Rules adopted hereunder from time to time by the Board and officers of the Association.
6.2. CLASSES OF VOTING RIGHTS.
The Association shall have two (2) classes of voting membership:
6.2.1. CLASS A.
Each Member, other than the Declarant, shall be a Class A
member. Class A membership entitles the holder to one (1) vote for each Residential Lot of
which he or she is record owner. If a Residential Lot is owned by more than one person, each
such person shall be a Member of the Association, but there shall be no more than one (1) vote
for each Residential Lot.
6.2.2. CLASS B.
The Declarant is a Class B Member. Class B membership entitles
the holder to three (3) votes for each Residential Lot of which the Declarant is record owner.
The Class B membership shall be irreversibly converted to Class
A membership on the first to occur of the following:
(a) Two (2) years following the conveyance by Declarant of
the first Residential Lot to a Retail Buyer under the authority of the most recently issued Public
Report for any Phase of the Project; or
(b) The fourth (4th) anniversary of the conveyance by
Declarant of the first Residential Lot to a Retail Buyer under the authority of the original Public
Report covering the first Phase of the Project.
6.3. COMMENCEMENT OF VOTING RIGHTS.
An Owner's right to vote, including Declarant, shall not vest until Assessments
have been levied upon such Owner's separate interest as provided in this Declaration. All
voting rights shall be subject to the restrictions and limitations provided for herein and in the
Articles and Bylaws.
MAGNOLIA AT LA COSTA
DECLARATION 15 CCRS-BY-AOI-DS.DOC
6.4. APPROVAL OF MEMBERS.
Unless specifically provided for otherwise, any provision of the Project
Documents requiring the vote or written assent of the Association voting power shall be deemed
satisfied by the following:
6.4.1. VOTE OF MAJORITY.
The vote of the majority at a meeting duly called and noticed
pursuant to the provisions of the Bylaws dealing with annual or special meetings of the
Members, unless a provision of this Declaration requires a special meeting only; provided,
however that such majority must include the specified number of all Members entitled to vote at
such meeting and not such a majority of a quorum of those Members present;
6.4.2. WRITING.
A writing or writings signed by a majority of the voting power; or
6.4.3. COMBINATION OF VOTES AND WRITING.
A combination of votes and written assent, provided that Members
shall not change their vote or written assent after it is cast or delivered and provided further that
only those written assents executed within sixty (60) days before or thirty (30) days after a
meeting may be combined with votes cast at such meeting to constitute a majority.
6.5. FIRST MEETING OF THE ASSOCIATION.
The first regular meeting of the Association shall be held no later than six (6)
months after the conveyance of the first Residential Lot in the first Phase of the Project.
Thereafter, regular meetings of the Association shall be held in accordance with provisions of
the Bylaws. At the first meeting, the Members shall elect the Board of Directors. Election to
and removal from the Board shall be by secret written ballot with cumulative voting, as more
particularly described in the Bylaws.
6.6. CLASS A MEMBERS' SELECTION OF ASSOCIATION DIRECTORS.
In any election of Directors, commencing on the first regular annual meeting
scheduled after the first Residential Lot is sold to an Owner, other than Declarant, so long as a
majority of the voting power of the Association resides in the Declarant, or so long as there are
two (2) outstanding classes of membership in the Association, not less than twenty percent
(20%) of the Directors shall have been elected solely by the votes of Class A Members, other
than the Declarant. Such Class A elected representative may be removed prior to the expiration
of his or her term of office only by a vote of at least a simple majority of the Members, excluding
the Declarant.
6.7. NO PERSONAL LIABILITY OF BOARD MEMBERS.
No member of the Board, or of any committee of the Association, or any officer of
the Association, or any manager, or Declarant, or any agent of Declarant, shall be personally
liable to any Owner, or to any other party, including the Association, for any error or omission of
the Association, the Board, its authorized agents or employees or its delegated committee, if
MAGNOLIA AT LA COSTA
DECLARATION 16 CCRS-BY-AOI-DJ.DOC
such person or entity has, on the basis of such information as may be possess by him or it.
acted in good faith without willful or intentional misconduct. In addition to the foregoing, as more
particularly specified in California Civil Code Section 1365.7, or any successor statute or law,
any person who suffers bodily injury, including, but not limited to, emotional distress or wrongful
death as a result of the tortious act or omission of a member of the Board who resides in the
Project either as a tenant or as an Owner of no more than two (2) Residential Lots, and who. at
the time of the act or omission, was a "volunteer" as defined in California Civil Code Section
1365.7, or any successor statute or law, shall not recover damages from such Board member, if
such Board member committed the act or omission within the scope of his or her Association
duties, while acting in good faith and without acting in a willful, wanton or grossly negligent
manner, provided that all of the requirements of California Civil Code Section 1365.7, or any
successor statue or law, have been satisfied.
7. RIGHTS. POWER AND DUTIES OF ASSOCIATION AND BOARD
The Association shall have all the powers of a nonprofit corporation organized under the
Nonprofit Mutual Benefit Corporation Law of California subject only to such limitations on the
exercise of such powers as are set forth in the Articles, the Bylaws and this Declaration. It shall
have the power to do any lawful thing that may be authorized, required, or permitted to be done
by the Association under this Declaration, the Articles and the Bylaws, and to do and perform
any act that may be necessary or proper for or incidental to, the exercise of any of the express
powers of the Association .including, without limitation, the powers set forth below.
7.1. ASSESSMENTS.
The Association shall have the power to establish, fix, and levy assessments
against the Owners and their Residential Lots, and to enforce payment of such assessments in
accordance with the provisions of this Declaration.
7.2. RIGHT OF ENFORCEMENT; PENALTIES; NOTICE AND HEARING.
7.2.1. ENFORCEMENT ACTIONS.
The Association in its own name and on its own behalf, or on
behalf of any Owner who consents, can commence and maintain actions for damages or to
restrain and enjoin any actual or threatened breach of any provision of the Project Documents
or any resolutions of the Board, and to enforce by mandatory injunction, or otherwise, all of
these provisions. In addition, the Association can temporarily suspend the membership rights
and privileges for any violation of the Project Documents or Board resolutions.
7.2.2. PENALTIES AGAINST MEMBERS.
The Board shall have the right to impose the following penalties
against Members:
(a) Suspension of the membership rights and privileges,
together with the voting rights of any Member of the Association, for any period of time during
which the assessment on a Member's Residential Lot remains unpaid;
MAGNOLIA AT LA COSTA
DECLARATION 17 CCRS-BY-AOI-DS.DOC
(b) Suspension of the membership rights and privileges,
together with the voting rights of any Member of the Association, for any period not to exceed
thirty (30) days for any infraction of the Association's Rules;
(c) Levying of monetary penalties against an individual
Member as a disciplinary measure for failure of a Member to comply with provisions of the
Project Documents or Board resolutions, or as a means of causing the Member to reimburse the
Association for costs and expenses incurred by the Association in the repair of damage to the
Association Area and facilities for which the Member was allegedly responsible, or in bringing
the Member and his or her Lot to compliance with the Project Documents or Board resolutions;
provided, however, no such monetary penalty may be characterized or treated as an
assessment which may become a lien against the Owner's subdivision interest enforceable by a
sale of the interest in accordance with the provisions of Sections 2924, 2924(b) and 2924(c) of
the California Civil Code.
(d) It is provided, however, that the provisions of the preceding
paragraph expressly do not apply to charges imposed against a Member consisting of
reasonable late payment penalties for delinquent assessments and/or charges to reimburse the
Association for the loss of interest and for costs reasonably incurred (including attorneys' fees)
in its efforts to collect delinquent assessments as more fully described in this Declaration.
In the event legal counsel is retained or legal action is instituted by
the Board pursuant to this Section, any settlement prior to judgment or any judgment rendered
in any such action shall include costs of collection, court costs and reasonable attorneys' fees.
A Member shall have the right to Notice and Hearing prior to the
Board's decisions to impose any suspension or monetary penalty, as more fully described in
Section entitled "Notice and Hearing."
7.3. RULES AND REGULATIONS.
The Board of the Association shall have the power to adopt, amend and repeal
uniform rules and regulations ("Association Rules" and/or "Rules") as it deems reasonable.
The Association Rules shall govern the use of the Association Area and portions of the
Residential Lots by all Owners or their Invitees, and the conduct of Owners and Invitees with
respect to automobile parking, outside storage of bicycles and other objects, disposal of waste
materials, drying of laundry, control of pets and other activities which, if not so regulated, might
detract from the appearance of the Community or offend or cause inconvenience or danger to
persons residing or visiting therein. Such Rules may provide that the Owner of a Lot whose
Invitee leaves property on the Association Area in violation of the Rules may be assessed after
Notice and Hearing an amount to cover the expense incurred by the Association in removing
such property and storing or disposing thereof.
7.4. RIGHT TO ENTER RESIDENTIAL LOT.
Except in the case of an Emergency, in which case no prior notice need be
given, the Board, the Architectural Committee, or any authorized representatives thereof, shall
have the right to enter during reasonable hours upon any Residential Lot (other than the interior
of a Dwelling) or Association Area when necessary to effect any maintenance obligations of the
Association hereunder. Notification of such entry shall be given at least forty-eight (48) hours
MAGNOLIA AT LA COSTA
DECLARATION 18 CCRS-BY-AOI-DS.DOC
in advance. Such entry shall be made with as little inconvenience to the Owner as possible and
any damage caused thereby shall be repaired by the Association at its own expense. The
Board, the Architectural Committee or such persons entering on behalf of the Board or
Architectural Committee shall not be deemed guilty of trespass by reason of such entry.
7.5. BORROW FUNDS.
The Board shall have the right to borrow money to improve, repair or maintain
the Association Area, provided that, the borrowing of any money or hypothecation of any real or
personal property in excess of five percent (5%) of the budgeted gross expenses of the
Association shall require the consent of fifty-one percent (51%) of each class of Members.
7.6. POWER OF BOARD TO DEFINE AND INTERPRET.
Notwithstanding anything contained in this Declaration or any other Project
Document, the Board shall have the power and the authority to define, interpret and/or construe
certain words and terminologies contained in this Declaration and the Project Documents which
may otherwise be unclear, vague and/or ambiguous, and, which, if not so defined,
interpreted or construed, would be detrimental to the Board's ability to conduct, manage and
control the affairs and business of the Association, including the enforcement of the covenants,
conditions, restrictions and other provisions of the Project Documents, as well as any rules and
regulations promulgated by the Board and not (a) inconsistent with law and/or (b) not in
contravention to the general plan for the subdivision, protection, maintenance, improvement,
sale and lease of the Project, or any portion thereof. Such words and terminology shall include.
but jiot be limited to. "nuisance," "annoyance," "obnoxious," "quiet enjoyment,"
"excessive," "disturb," "obstruct," "interfere," "minor repair," "hazard," "offensive."
8. RIGHTS OF OWNERS
8.1. RIGHTS OF OWNERS.
Owners, and, to the extent permitted by such Owner, such Owner's Invitees, and
contract purchasers who reside in such Owner's Dwelling, shall have the following rights and
limitations:
8.2. RIGHT OF ACCESS AND USE OF DWELLING.
The right of access over the Association Area for ingress to and egress from
such Owner's Residential Lot and Dwelling thereon, and of enjoyment and full use of such
Residential Lot and Dwelling, which right shall be appurtenant to and shall pass with title to the
Owner's Residential Lot, subject to the limitations contained herein. This right cannot be
forfeited or abridged by the failure by an Owner to comply with provisions of the Project
Documents or duly-enacted Rules, except by judgment of a court or a decision arising out of
arbitration or on account of a foreclosure or sale under a power of sale for failure of the Owner
to pay assessments levied by the Association.
MAGNOLIA AT LA COSTA
DECLARATION 19 CCRS-BY-AOI-DS.DOC
8.3. NOTICE AND HEARING.
The right to receive at least fifteen (15) days' written notice prior to a decision by
the Board to impose monetary penalties, a temporary suspension of an Owner's right as a
Member of the Association, or other appropriate discipline for failure of the Member to comply
with the Project Documents as described more fully in the Section entitled "Penalties Against
Members" hereinabove, or any such longer period as may be required under Section 7341 of
the California Corporations Code (or any successor statute or law). Additionally, before the
Board decides to impose a suspension of privileges or impose a monetary penalty, the
aggrieved Owner shall be provided with an opportunity to be heard by the Board, orally or in
writing, not less than five (5) days before the date of the suspension of privileges or imposition
of a monetary penalty is to take effect. For purposes of this Section, notice shall be given by
any method reasonably calculated to provide actual notice. Notice may be hand-delivered to
the Owner, or sent by first class registered or certified mail, return receipt requested, or
overnight delivery and addressed to the Owner at the last address of the Owner shown on the
Association's records, or any other method deemed reasonable by the Board for delivering
notices. Each suspended or fined Owner or other person can appeal a suspension or monetary
penalty imposed by the Board, including any claim alleging defective notice, within one (1) year
of the date of action taken by the Board, by filing written notice of his or her intention to appeal
with the Board. The action imposing the fine or suspension shall then become ineffective until
the fine or suspension is unanimously approved by all directors of the Board at a regular or
special meeting of the Board at which all directors are present. The Owner or any other person
to be fined or suspended can appear, be represented by legal counsel and be heard at the
meeting before the Board, either orally or in writing.
9. ASSESSMENTS
9.1. COVEN ANT FOR ASSESSMENTS.
Subsequent to the conveyance of the first Residential Lot in the Property to a
Retail Buyer, the Declarant, for each Residential Lot owned within a Phase of the Property in
which either a Residential Lot has been sold to a Retail Buyer under the authority of a Public
Report, or leased, as more fully described, respectively, in the Sections herein entitled
"Commencement of Assessments" and "Assessments On Residential Lots Not Conveyed
to Retail Buyers," hereby covenants, and each Owner of a Residential Lot by acceptance of a
deed therefor, whether or not it shall be so expressed in such Deed, is deemed to covenant and
agree to pay to the Association all assessments levied pursuant to the provisions of this
Declaration. All assessments, together with interest, costs, late charges and reasonable
attorneys' fees, shall be a charge on and a continuing lien upon the Residential Lot against
which each such assessment is made, the lien to become effective upon recordation of a Notice
of Delinquent Assessment, as provided in this Article. Each such assessment, together with
interest, costs, late charges and reasonable attorneys' fees, shall also be the personal
obligation of the Person who was the Owner of such Residential Lot at the time when the
assessment fell due and shall bind his or her heirs, devisees, personal representatives and
assigns. Unlike the lien for delinquent assessments, the personal obligation for non-delinquent
assessments shall not pass to successive Owners, unless expressly assumed by each such
successive Owner. No such assumption of personal liability by a successive Owner (including a
contract purchaser under an installment land contract) shall relieve any Owner from personal
MAGNOLIA AT LA COSTA
DECLARATION 20 CCRS-BY-AOI-DXDOC
liability for delinquent assessments. If more than one person or entity was the Owner of a
Residential Lot, the personal obligation to pay such assessment or installment respecting such
Residential Lot shall be both joint and several.
9.2. FUNDS HELD IN TRUST.
The assessments collected by the Association shall be held by the Association
for and on behalf of each Owner and shall be used solely for the operation, care and
maintenance of the Project as provided in this Declaration. Upon the sale or transfer of a
Residential Lot, the Owner's interest in the funds shall be deemed automatically transferred to
the successor in interest of such Owner.
9.3. PURPOSE OF ASSESSMENTS.
The assessments levied by the Association shall be used exclusively to promote
the recreation, health, safety and welfare of all the residents in the Project and for the
improvement and maintenance of the Association Area and for any other maintenance
responsibilities of the Association, and to reimburse the Association for costs incurred in
bringing an Owner into compliance with the Project Documents.
9.4. REGULAR ASSESSMENTS.
9.4.1. PAYMENT OF REGULAR ASSESSMENTS.
Regular Assessments for each fiscal year of the Association shall
be established when the Board approves the Budget for that fiscal year, which Budget shall be
prepared in accordance with the provisions of this Declaration. Regular Assessments shall be
levied on a fiscal year basis. Unless otherwise specified by the Board, Regular Assessments
shall be due and payable in monthly installments on the first day of each month during the term
of this Declaration.
9.4.2. BUDGETING.
Regardless of the number of Members or the amount of assets of
the Association, each year the Board shall prepare, approve and make available to each
Member a Budget as described in the Bylaws. Increases in Regular Assessments shall be
subject to the limitations set forth in Section 9.15 below. For the first fiscal year, the Budget
upon which Regular Assessments shall be based shall be the Budget accepted by the ORE and
shall be approved by the Board no later than the date on which Regular Assessments are
scheduled to commence. Thereafter, the Board shall annually prepare and approve the Budget
and distribute a copy thereof to each Member (or a summary thereof as provided in the
Bylaws), together with written notice of the amount of the Regular Assessment to be levied
against the Owner's Residential Lot, not less than forty-five (45) days nor more than sixty (60)
days prior to the beginning of the fiscal year.
9.4.3. RESTRICTIONS OF TAX EXEMPTION.
As long as the Association seeks to qualify and be considered as
an organization exempt from federal and state income taxes pursuant to Internal Revenue Code
Section 528 and California Revenue and Taxation Code Section 237011 and any amendments
thereto, then the Board shall prepare its annual budget and otherwise conduct the business of
MAGNOLIA AT LA COSTA
DECLARATION 21 CCRS-BY-AOI-DS.DOC
the Association in such manner consistent with federal and state requirements to qualify for
such status.
9.4.4. ASSESSMENTS AFTER ANNEXATION.
(A) REALLOCATION OF ASSESSMENTS.
After annexation of a Phase, the assessment in the budget
shall be reallocated among all Residential Lots in the Project, including those in the Annexed
Property, in the same manner as described above.
(B) REVISION OF BUDGET.
After each Phase has been annexed, the Board shall
approve a new Budget for the remainder of the current fiscal year for use upon the
commencement of Regular Assessments against Residential Lots in the new Annexed Phase.
Declarant shall give notice to the Association of the annexation of an Unannexed Phase and
shall give the Association a copy of the Budget submitted to the ORE in connection with the
Public Report for that annexing Phase. Notice of the new Regular Assessment to be levied
against each Residential Lot in the Project shall be delivered to the Owners and Declarant
within thirty (30) days after the date that such Unannexed Phase becomes and Annexed Phase
pursuant to this Declaration.
9.5. NON-WAIVER OF ASSESSMENTS.
If before the expiration of any fiscal year the Association fails to fix Regular
Assessments for the next fiscal year, the Regular Assessment established for the preceding
year shall continue until a new Regular Assessment is fixed.
9.6. SPECIAL ASSESSMENTS.
If the Board determines that the estimated total amount of funds necessary to
defray the Common Expenses of the Association for a given fiscal year is or will become
inadequate to meet expenses for any reason, including, but not limited to, unanticipated
delinquencies, costs of construction, unexpected repairs, replacement of or new capital
improvements on, damage and destruction or condemnation of the Association Area, the Board
shall determine the approximate amount necessary to defray such expenses and, if the amount
is approved by a majority vote of the Board and does not exceed five percent (5%) of the
budgeted gross expenses of the Association, it shall become a Special Assessment; provided,
however that such limitation shall not apply to Special Assessments levied by the Board to
replenish the Association's reserve account as provided in the Bylaws Section entitled "USE
OF RESERVE FUNDS." Except for a Special Assessment levied pursuant to the Bylaws
Section entitled "USE OF RESERVE FUNDS," any Special Assessment in excess of five
percent (5%) of the budgeted gross expenses of the Association shall be subject to the
limitation set forth in the Section below entitled "Limitations on Assessments." The Board
may, in its discretion, prorate such Special Assessment over the remaining months of the fiscal
year or levy the assessment immediately against each Residential Lot. Unless exempt from
federal or state income taxation, all proceeds form any Special Assessment shall be segregated
and deposited into a Financial Account and shall be used solely for the purpose or purposes of
which it was levied or it shall be otherwise handled and used in a manner authorized by law or
MAGNOLIA AT LA COSTA
DECLARATION 22 CCRS-BY^OI-DS.DOC
regulations of the Internal Revenue Service or the California Franchise Tax Board in order to
avoid, if possible, its taxation as income of the Association.
9.7. CAPITAL IMPROVEMENT ASSESSMENT
In addition to any other assessments provided for hereunder, the Association
may levy a Capital Improvement Assessment for the purpose of defraying, in whole or in part,
the cost of any construction or replacement of a capital improvement in accordance with the
provisions of the Bylaws Section entitled "Capital Improvements." Capital Improvement
Assessments shall be due and payable by all Owners in such installments and during such
period or periods as the Board shall designate. Increase in Capital Improvement Assessments
shall be subject to the limitations set forth in the Section below entitled "Limitations on
Assessments."
9.8. SINGLE BENEFIT ASSESSMENT.
The Board may establish a Single Benefit Assessment for reconstruction, capital
improvements, extraordinary maintenance, or any other cost or expense not otherwise provided
for in this Declaration which will benefit less than all of the Owners, and which will be assessed
only against the Lots of those Owners so benefiting.
(a) Except as provided in the paragraph immediately below, such Single
Benefit Assessments may be imposed only by a vote of at least fifty-one percent (51%) of the
Owners of the Residential Lots benefited by the Single Benefit Assessment.
(b) Whenever the Association performs any service or accomplishes any
item of repair or maintenance which is the duty of an Owner to accomplish, but which has not
been accomplished by such Owner, or whenever the Association determines to preempt the
performance of a specific Owner of a given act of maintenance or repair, the Association shall
specifically charge the cost thereof, together with any financing costs and administrative costs
incurred by the Association, to the Owner for whom such work was done, and shall include such
additional cost as a Single Benefit Assessment for such Owner(s).
Each Single Benefit Assessment shall be segregated in the Financial Accounts
solely to the Residential Lots which derive the benefit therefrom. In the event that the
Association obtains income directly related to an item which has been assessed as a Single
Benefit Assessment, such income shall be allocated so as to reduce or offset such Single
Benefit Assessment.
9.9. ENFORCEMENT ASSESSMENTS.
The Association may levy an Enforcement Assessment against any Owner who
causes damage to the Association Area or for bringing an Owner or his or her Residential Lot
into compliance with the provisions of the Project Documents or any other charge designated an
Enforcement Assessment in the Project Documents, together with attorneys' fees, interest and
other charges related thereto as provided in this Declaration. The Board shall have the
authority to adopt a reasonable schedule of Enforcement Assessments for any violation of the
Project Documents. If, after Notice and Hearing as required by this Declaration and which
satisfies Section 7341 of the California Corporations Code, the Owner fails to cure or continues
such violation, the Association may impose an additional fine each time the violation is
MAGNOLIA AT LA COSTA
DECLARATION 23 CCRS-BY-AOI-DS-DOC
repeated, and may assess such Owner and enforce the Enforcement Assessment as herein
provided for nonpayment of an assessment. A hearing committee may be established by the
Board to administer the foregoing. Notwithstanding any other provision in this Declaration to the
contrary, Enforcement Assessments are assessments, but they may not become a lien against
the Owner's Residential Lot that is enforceable by a power of sale under Civil Code Sections
2924, 2924b and 2924c or any successor statute or laws. This restriction on enforcement is not
applicable to late payment penalties for delinquent assessments or charges imposed to
reimburse the Association for loss of interest or for collection costs, including reasonable
attorneys' fees, for delinquent assessments.
9.10. UNIFORM RATE OF ASSESSMENT.
Regular Assessments, Special Assessments and Capital Improvement
Assessments shall be levied at a uniform rate for all Residential Lots and may be collected on a
monthly basis, or otherwise, as determined by the Board. Enforcement Assessments and
Single Benefit Assessments shall be levied directly to the individual Residential Lots and/or their
respective Owners, depending upon whether the assessment may become a lien against the
Residential Lot, as provided in this Declaration.
9.11. EXCESSIVE ASSESSMENTS OR FEES.
The Board may not impose or collect an assessment or fee that exceeds the
amount necessary to defray the costs for which it is levied.
9.12. COMMENCEMENT OF ASSESSMENTS; DUE DATES.
9.12.1. FIRST PHASE.
The monthly installments for Regular Assessments provided for herein shall
commence as to all Residential Lots in the first Phase of the Project on the first day of the
month following the conveyance of the first Residential Lot within such initial Phase to a Retail
Buyer. The first annual assessment shall be adjusted according to the number of months
remaining in the fiscal year.
9.12.2. SUBSEQUENT PHASE(S).
Regular Assessments shall commence as to all Residential Lots in
the second or any subsequent Phase ("Subsequent Phase") after the first Phase on: (a) the
first day of the month following the conveyance of the first Residential Lot within such
Subsequent Phase to a Retail Buyer under the authority of a Public Report, or (b) upon the first
day of the month following the date that Declarant leases a Dwelling, or (c) such earlier date as
may be selected by Declarant for the commencement of assessments in such Subsequent
Phase, regardless of whether a conveyance or leasing has occurred.
9.13. NOTICE AND ASSESSMENT INSTALLMENT DUE DATES.
A single ten (10) day prior written notice of each Special Assessment and
Capital Improvement Assessment shall be given to each Owner. The first fiscal year's
Regular Assessment shall be equal to the amount shown in the Budget accepted by the ORE
as stated in the Public Report for the first Phase of the Project. Written notice of the amount of
the Regular Assessment for each fiscal year after the first fiscal year shall be distributed to
MAGNOLIA AT LA COSTA
DECLARATION 24 CCRS-BY-AOI-DS.DOC
each Owner not less than forty-five (45) days nor more than sixty (60) days prior to the
beginning of the fiscal year, together with a copy of the approved Budget for that fiscal year, as
more fully described in Section 9.4.2 above entitled "BUDGETING." The foregoing
notwithstanding, the failure of the Board to comply with the foregoing notice provisions shall not
affect the validity of any assessment levied by the Board,
The due dates for the payment of assessments shall normally be established as
monthly installments due on the first day of each month unless some other due date and/or
payment schedule is established by the Board.
9.14. FAILURE TO FIX ASSESSMENTS.
The omission by the Board to fix the assessments hereunder before the
expiration of any fiscal year, for that or the next year, shall not be deemed either a waiver or
modification in any respect of the provisions of this Declaration or a release of the Owner from
the obligation to pay the assessments or any installment thereof for that or any subsequent
year, but the assessment fixed for the preceding year shall continue until a new assessment is
fixed.
9.15. LIMITATIONS ON ASSESSMENTS.
(a) The Board of Directors of the Association shall not impose or collect an
assessment, penalty, or fee that exceeds the amount necessary for the purpose or purposes for
which it is levied. Annual increases in Regular Assessments for any fiscal year, as authorized
by subsection (b) immediately hereinafter, shall not be imposed unless the Board has prepared
and distributed the budget described in Section 9.4.2 above, and in the "Financial" Section of
the Bylaws, in accordance with the provisions of Civil Code Section 1365(a) as it may from time
to time be amended, with respect to that fiscal year, or has obtained the approval of Owners
constituting a quorum, casting a majority of the votes at a meeting or election of the Association
conducted in accordance with Chapter 5 (commencing with Section 7510) of Part 3 of Division 2
of Title 1 of the Corporations Code and Section 7613 of the Corporations Code, or any
successor statute.
(b) From and after January 1st of the year immediately following the
conveyance of the first Residential Lot to an Owner, the Board of Directors of the Association
may not impose, except as provided herein, a Regular Assessment that is more than twenty
percent (20%) greater than the Regular Assessment for the Association's preceding fiscal year
or impose special assessments which in the aggregate exceed five percent (5%) of the
budgeted gross expenses of the Association for that fiscal year without the approval of Owners
constituting a quorum casting a majority of the votes at a meeting or election of the Association
conducted in accordance with Chapter 5 (commencing with Section 7510) of Part 3 of Division 2
of Title 1 of the Corporations Code and Section 7613 of the Corporations Code. These
provisions, however, shall not limit assessment increases necessary for the following
"emergency situations;"
(1) An extraordinary expense required by an order of a
court;
MAGNOLIA AT LA COSTA
DECLARATION 25 CCRS-BY-AOI-DS.DOC
(2) An extraordinary expense necessary to repair or
maintain those portions of the Project or the Association Area for which the Association is
responsible where a threat to personal safety is discovered;
(3) An extraordinary expense necessary to repair or
maintain those portions of the Project or the Association Area for which the Association is
responsible that could not have been reasonably foreseen by the Board in preparing and
distributing the budget under this Declaration and the Bylaws, in accordance with Civil Code
Section 1365, or any amendment thereto;, provided, however, that prior to the imposition or
collection of an assessment under this paragraph, the Board shall pass a resolution containing
written findings as to the necessity of the extraordinary expense involved and why the expense
was not or could not have been reasonably foreseen in the budgeting process, and the
resolution shall be distributed to the Members with the "Notice of Regular Assessment",
(4) An extraordinary expense in making the first
payment of the earthquake insurance surcharge pursuant to Section 5003 of the California
Insurance Code.
(c) Any increases authorized under this Section shall not be imposed unless
the Board has complied with the budgetary requirements set forth in the Bylaws with respect to
the fiscal year for which an assessment is levied. For the purpose of calculating whether an
increase to Regular Assessments exceeds twenty percent (20%), the term "Regular
Assessments" shall be deemed to include the amount assessed against each Residential Lot by
the Association as a Regular Assessment plus any amount paid by Declarant as a subsidy
pursuant to any subsidy agreements, to the extent such subsidy payments offset any amount
which would otherwise be paid by Owners as Regular Assessments.
(d) For purposes of this Section, "quorum" is defined as more than fifty
percent (50%) of the Owners (including the Declarant) of the Association.
(e) Any action authorized under this Section shall be taken at a meeting
called for that purpose, written notice of which shall be sent to all Members not less than ten
(10) days nor more than ninety (90) days in advance of the meeting.
9.16. AUTOMATIC ASSESSMENT INCREASES.
Notwithstanding any other provision of this Article annexation of any
Unannexed Phase to the Project and this Declaration, the Regular Assessment shall be
automatically increased by the additional amount, if any, necessary to maintain the Association
Area to perform the Association's obligations hereunder in accordance with the standards
prescribed by the then current ORE "Operating Cost Manual," or, if the Operating Cost Manual
is no longer maintained by the ORE, pursuant to standards prescribed by comparable
maintenance cost guidelines prepared in accordance with prudent property management
practices. However, such increase shall occur only if (a) the annexation of an Unannexed
Phase is authorized by the ORE as evidenced by its issuance of a Public Report therefor, and
(b) the amount of such increase does not result in the levy of a Regular Assessment that is
greater than the maximum potential Regular Assessment disclosed in all Public Reports for the
Property previously issued by the ORE.
MAGNOLIA AT LA COSTA
DECLARATION 26 CCRS-BY-AOI-DS.OOC
9.17. NOTICE OF ASSESSMENT INCREASE.
The Board shall provide notice by first-class mail to the Owners of any increase
in the Regular Assessment or Special Assessments or Capital Improvement Assessments
of the Association, not less than thirty (30) nor more than sixty (60) days prior to the increased
assessment becoming due and payable.
9.18. REDUCTION OR ABATEMENT OF REGULAR ASSESSMENTS.
In the event the amount budgeted to meet Common Expenses for a particular
fiscal year proves to be excessive in light of the actual Common Expenses, the Board in its
discretion may either reduce the amount of the Regular Assessments or may abate collection of
Regular Assessments as it deems appropriate. Nothing in this Section shall require the Board
either to abate or reduce the Regular Assessments. The foregoing notwithstanding, neither an
abatement nor a reduction in Regular Assessments shall be permitted so long as Declarant is
possessed with or controls a majority of the total voting power of the Association or the Board.
9.19. NO OFFSETS.
All assessments shall be payable in the amount specified by the Board and no
offsets against such amount shall be permitted for any reason, including, without limitation (a) a
claim that the Association is not properly exercising its duties and powers as provided in this
Declaration;(b) a Member has made or elects to make no use of the Association Area or any
Improvements located therein; or, (c) any construction or maintenance performed pursuant to
Section shall in any way postpone assessments or entitle a Member to claim any such offset or
reduction,
9.20. DELINQUENCIES; LATE PENALTIES; INTEREST ON ASSESSMENTS.
Any assessment not paid within fifteen (15) days after the due date shall be
delinquent and shall be subject to a reasonable late penalty not exceeding ten percent (10%) of
the delinquent assessment or ten dollars ($10.00), whichever is greater, and shall bear interest
on all sums including the delinquent assessment, reasonable costs for collection and late
penalties at an annual percentage not exceeding twelve percent (12%) commencing thirty (30)
days after the assessment becomes due, or at the maximum legal rate as defined in the
California Civil Code Section 1366, or any successor statute or law.
9.21. DEBT OF THE OWNER.
Any assessment made in accordance with this Declaration and any late charges,
reasonable costs of collection and interest, shall be a debt of the Owner of a Residential Lot
from the time the assessment and other sums are levied.
9.22. ASSOCIATION POLICIES AND PRACTICES RE: DEFAULTS.
9.22.1. ASSESSMENT DEFAULTS.
The Board shall annually distribute during the sixty (60) day period
immediately preceding the beginning of the Association's fiscal year, a statement of the
Association's policies and practices in enforcing its remedies against Members for defaults in
MAGNOLIA AT LA COSTA
DECLARATION 27 ccRs-Bv-Aoi-D3.DOC
the payment of Regular and Special Assessments, including the recording and foreclosing of
liens against Members' Residential Lots.
9.22.2. MONETARY PENALTIES AND FEES.
If the Association adopts or has adopted a policy imposing any
monetary penalty, including any fee, on any Member for a violation of the Project Documents,
including any monetary penalty relating to the activities of an Invitee, the Board shall adopt and
distribute to each Member, by personal delivery or first-class mail, a schedule of the monetary
penalties that may be assessed for those violations, which shall be in accordance with
authorization for Member discipline contained in Section and Section entitled "NOTICE AND
HEARING" herein; provided, however, no such monetary penalty may be characterized or
treated as an assessment which may become a lien against the Owner's subdivision interest
enforceable by a sale of the interest in accordance with the provisions of Sections 2024,
2024(b) and 2024(c) of the California Civil Code. The Board, however, shall not be required to
distribute any additional schedules of monetary penalties unless there are changes from the
schedule that was previously adopted and distributed to the Members.
9.23. COLLECTION OF ASSESSMENTS; LIENS.
9.23.1. RIGHT TO ENFORCE ASSESSMENTS.
The right to collect and enforce assessments is vested in the
Board acting for and on behalf of the Association. The Board or its authorized representative,
can enforce the obligations of the Owners to pay assessments provided for in this Declaration
by commencement and maintenance of a suit at law or in equity, or the Board may foreclose by
judicial proceedings or through the exercise of the power of sale pursuant to Section 9.23.7
below, enforce the lien rights created. Suit to recover a money judgment for unpaid
assessments together with all other Additional Charges described in Section 9.24 hereafter
shall be maintainable without foreclosing or waiving the lien rights. Notwithstanding anything
else to the contrary herein, except for monetary penalties imposed by the Association to
reimburse the Association for costs incurred by the Association in the repair of damage to the
Association Area for which the Member or the Member's Invitees were responsible, which may
become a lien on the Owner's Residential Lot, a monetary penalty imposed by the Association
as a disciplinary measure for failure of a Member to comply with the Project Documents or in
bringing the Member and his or her Residential Lot into compliance with the governing
instruments of the Association may not be characterized nor treated as an assessment which
may become a lien against the Member's Residential Lot enforceable by a sale of the interest
hereunder. The limitation in the preceding sentence however, does not apply to any Additional
Charges.
9.23.2. NOTICE TO OWNER PRIOR TO LIEN OF ASSESSMENT.
Before the Association may place a lien upon an Owner's
Residential Lot to collect any assessment which is past due, the Association shall provide
written notice ("Itemized Debt Notice") to the Owner by certified mail of the following:
(a) Fee and penalty procedures of the Association as
described in Section 9.22 above;
MAGNOLIA AT LA COSTA
DECLARATION 28 CCRS-BY-AOI-DS-DOC
(b) An itemized statement of the charges owed by the Owner,
including items on the statement which indicate (i) the principal owed, (ii) any late charges and
the method of calculation, (iii) any attorney's fees, and (iv) the collection practices used by the
Association, including the right of the Association to the reasonable costs of collection.
9.23.3. LIEN OF ASSESSMENT.
At any time after (a) any assessments levied by the Association
affecting any Residential Lot have become delinquent, and (b) the Itemized Debt Notice thereof
has been mailed to the Owner of such Residential Lot, the Board may file for recording in the
Office of the San Diego County Recorder a "Notice of Delinquent Assessment" as to such
Residential Lot, which notice shall state all amounts which have become delinquent with respect
to such Residential Lot and the costs (including attorneys' fees), late penalties and interest
which have accrued thereon, the amount of any assessments relating to such Residential Lot
which is due and payable although not delinquent, a legal description of the Residential Lot
with the name of the record or reputed record Owner of such Residential Lot, and the name
and address of the trustee authorized by the Association to enforce the lien, if by nonjudicial
foreclosure as provided below. Such notice shall be signed by the President, Vice President,
Secretary, or Chief Financial Officer of the Association, or by an authorized agent (as
designated by resolution of the Board) of the Association. Immediately upon recording of any
Notice of Delinquent Assessment pursuant to the foregoing provisions of this Section, the
amounts delinquent, as set forth in such Notice, together with the costs (including attorneys'
fees), late penalties and interest accruing thereon, shall be and become a lien upon the Lot
described therein, which lien shall also secure all costs (including attorney's fees), late penalties
and interest accruing thereon. The lien may be enforced as provided in Section 9.23.7 below,
entitled
9.23.4. NOTICE TO OWNER AFTER LIEN OF ASSESSMENT.
Not later than fen (10) calendar days after recordation of the
Notice of Delinquent Assessment in the Office of the San Diego County Recorder, California, a
copy of the Notice of Delinquent Assessment and the recording date thereof shall be mailed to
all record Owners of the Residential Lot by certified or registered mailed, in accordance with the
manner set forth in Civil Code Section 2924b, or any successor statute or law.
9.23.5. PAYMENTS UNDER PROTEST.
An Owner who disputes an assessment imposed by the
Association against such Owner and/or such Owner's Residential Lot shall have the right to
resolve such dispute through (i) alternative dispute resolution as set forth in Civil Code
Section 1354, (ii) civil action, and (iii) any other dispute resolution procedure that may be
available through the Association, as provided in Civil Code Section 1366.3, or any successor
statutes or laws.
9.23.6. RELEASE OF LIEN.
In the event the delinquent assessments and all other
assessments which have become due and payable with respect to the same Residential Lot
together with all costs (including attorneys1 fees), late charges and interest which have accrued
on such amounts are fully paid or otherwise satisfied prior to the completion of any sale held to
MAGNOLIA AT LA COSTA
DECLARATION 29 CCRS-BY-AOI-DS-DOC
foreclose the lien provided for in this Article, the Board shall record a further notice, similarly
signed, stating the satisfaction and release of such lien.
9.23.7. LIEN ENFORCEMENT; FORECLOSURE PROCEEDINGS.
After the expiration of thirty (30) days following the recording of
the Notice of Delinquent Assessment in the Office of the San Diego County Recorder,
California, the lien created by such recording may be foreclosed in any manner permitted by
law, including sale by the court, sale by the trustee designated in the Notice of Delinquent
Assessment, or sale by a trustee substituted pursuant to Civil Code Section 2934a. Any sale by
the trustee shall be conducted in accordance with the provisions of Civil Code Sections 2924,
2924(b), 2924(c) and 1367, or any successor statute or law. The Association, acting on behalf
of the Owners, shall have the power to bid for the Residential Lot at a foreclosure sale, and to
acquire and hold, lease, mortgage and convey the same. Suit to recover a money judgment for
unpaid assessments, costs, late penalties and attorneys' fees shall be maintainable without
foreclosing or waiving the lien securing the same.
9.24. ADDITIONAL CHARGES.
In addition to any other amounts due or any other relief or remedy obtained
against an Owner who is delinquent in the payment of any assessments, each Owner agrees to
pay Additional Charges incurred or levied by the Board including such additional costs, fees,
charges and expenditures as the Association may incur or levy in the process of collecting from
that Owner monies due and delinquent. Additional Charges shall include, but not be limited to,
the following:
9.24.1. ATTORNEY'S FEES.
Reasonable attorneys' fees and costs incurred in the event an
attorney(s) is employed to collect any assessment or sum due, whether by suit or otherwise;
9.24.2. LATE CHARGES.
A late charge in an amount to be fixed by the Board in accordance
with Civil Code Section 1366, or any successor statute or law, to compensate the Association
for additional collection costs incurred in the event any assessment or other sum is not paid
when due or within any "grace" period established by law;
9.24.3. COSTS OF SUIT.
Costs of suit and court costs incurred as are allowed by the court;
9.24.4. INTEREST.
Interest to the extent permitted by law; and
9.24.5. OTHER.
Any such other additional costs that the Association may incur in
the process of collecting delinquent assessments or sums.
MAGNOLIA AT LA COSTA
DECLARATION 30 CCRS-BY-AOI-DS.DOC
9.25. PRIORITY OF THE LIEN.
The lien of assessment herein shall be subordinate to the lien of any First
Mortgage now or hereafter placed upon any Residential Lot subject to assessment, and the sale
or transfer of any Residential Lot pursuant to judicial or nonjudicial foreclosure transfer
(excluding a transfer by deed in lieu of foreclosure) of a First Mortgage shall extinguish the lien
of such assessments as to payments which became due prior to such sale or transfer. No sale
or transfer shall relieve such Residential Lot from lien rights for any assessments thereafter
becoming due nor from the lien of any subsequent assessment. Where the First Mortgagee or
other purchaser of a Residential Lot obtains title to the same as a result of foreclosure
(excluding a transfer by deed in lieu of foreclosure), such acquirer of title, his or her successors
and assigns, shall not be liable for the share of common expenses or assessments by the
Association chargeable to such Residential Lot which became due prior to the acquisition of title
to such Residential Lot by such acquirer, exempt except for a share of such charges or
assessments resulting from a reallocation of such charges or assessments which are made
against all Residential Lots.
9.26. WAIVER OF EXEMPTIONS.
Each Owner, to the extent permitted by law, waives, to the extent any liens
created pursuant to this Article, the benefit of any homestead or exemption laws of California in
effect at the time any assessment or installment thereof becomes delinquent, or any lien is
imposed.
9.27. TAXATION AGAINST THE ASSOCIATION AREA.
In the event that any taxes are assessed against the Association Area or any
portion thereof, or Association Property, rather than against the individual Residential Lots, said
taxes shall be added to the Regular Assessments, and, if necessary, a Special Assessment
may be levied against the Residential Lots in an amount equal to said taxes, to be paid in two
(2) installments, thirty (30) days prior to the due date of each tax installment, or as otherwise
may be established by the Board.
9.28. PERSONAL LIABILITY OF OWNER.
No Owner may exempt himself from personal liability for assessments levied by
the Association, nor release the Residential Lot owned by him from the liens and charges hereof
by waiver of the use or enjoyment of any of the Association Area or by abandonment of his or
her Residential Lot.
9.29. TRANSFER OF RESIDENTIAL LOT.
After transfer or sale of a Residential Lot within the Project, the selling Owner or
Owners shall not be liable for any assessment levied on such Owner or Owner's Residential Lot
after the date of such transfer of ownership and written notice of such transfer is delivered to the
Association. The selling Owner shall still be personally responsible for all assessments and
charges levied on his or her Residential Lot prior to any such transfer.
MAGNOLIA AT LA COSTA
DECLARATION 31 CCRS-BY-AOI-DS.DOC
9.30. FINANCIAL ACCOUNTS.
The Board shall establish financial accounts ("Financial Accounts"), into which
shall be deposited all monies paid to the Association and from which disbursements shall be
made, as provided herein, in the performance of functions by the Association under this
Declaration and the Bylaws. The Financial Accounts shall be established in accounts at any
banking, savings, brokerage or similar institution ("Institution"), provided such funds are fully
insured (i) by the Federal Deposit Insurance Corporation or similar Federal insuring agency, or
(ii) by a comparable account insurer. Aggregate deposits held in any single Institution shall not
exceed the limit of deposit insurance coverage available. The Financial Accounts shall include:
(a) An Operating Account for current Common Expenses of the Association;
(b) A Reserve Account for capital improvements, replacements, painting and
repairs of the Association Area; and
(c) Any Other Accounts that the Board may establish to the extent necessary
under the provisions of this Declaration.
Except for purposes of transfer of funds upon receipt or disbursement thereof,
the Board shall not commingle any amounts deposited into any of the Financial Accounts with
one another. Nothing contained herein shall limit, preclude or impair the establishment of
additional Financial Accounts by the Declarant so long as the amounts assessed to, deposited
into, and disbursed from any such Account are earmarked for specified purposes authorized by
this Declaration or the Bylaws.
9.31. USE OF RESERVE FUNDS.
Any reserve fund accounts maintained by the Association (including any capital
accounts maintained pursuant to the above Section entitled "Financial Accounts") shall be
used for the purposes and in the manner described in California Civil Code Section 1365.5, as it
may from time to time be amended.
10. ANNEXATION
10.1. AUTOMATIC ANNEXATION BY CONVEYANCE OR LEASING OF
RESIDENTIAL LOT IN AN UNANNEXED PHASE.
A subsequent Unannexed Phase after the first Annexed Phase shall
automatically become an Annexed Phase, and thereby become annexed to the Association and
to all of the specific terms of this Declaration, upon either (a) the conveyance by Declarant of at
least one Residential Lot in such subsequent Phase to a Retail Buyer under the authority of a
Public Report, or (b) the leasing or occupancy of at least one Residential Lot and a Dwelling
located thereon by Declarant to a tenant, whereafter each such Phase shall become an
"Annexed Phase," fully subject to all of the terms, conditions and restrictions contained in this
Declaration, and voting rights and assessments shall commence in accordance with the
provisions therefor contained herein.
MAGNOLIA AT LA COSTA
DECLARATION 32 CCRS-BY-AOI-DJ.OOC
10.2. ANNEXATION WITHOUT CONVEYANCE OF RESIDENTIAL LOT.
Declarant may cause an Unannexed Phase and the lots and/or easements
Association therein to become annexed to the Association and this Declaration and become an
"Annexed Phase" without the conveyance of a Residential Lot located therein, by:
(a) The recordation by Declarant of a Declaration of Annexation or a
Supplementary Declaration (hereafter "Annexation Instrument"), covering any such
Unannexed Phase, declaring that upon the recordation of the Annexation Instrument for such
Unannexed Phase, that such Phase shall be annexed under this Declaration. Any such
Annexation Instrument shall be signed and acknowledged by Declarant.
(b) Upon the recordation of the duly authorized Annexation Instrument, such
Unannexed Phase, the Residential Lots and the Association Areas therein, if any, shall become
an Annexed Phase.
10.3. DECLARATION OF ANNEXATION.
Declarant may, at its election, record in the Office of the County Recorder a
"Declaration of Annexation" or "Supplemental Declaration" evidencing the annexation of
an Unannexed Phase to the Association with the approval of the DRE and under the authority of
a Public Report, as provided for in Section 10.1; provided, however, the recordation of such
Declaration of Annexation or Supplemental Declaration is not a requirement in order to effect
the annexation of an Unannexed Phase by operation of the conveyance or leasing described in
Section 10.1. A Declaration of Annexation or a Supplemental Declaration may also serve to
contain such complementary additions and modifications of the covenants, conditions and
restrictions contained in this Declaration as may be necessary to reflect the different character,
if any, of the Phase to be annexed and as are not inconsistent with the plan of this Declaration.
In no event, however, shall any such Declaration of Annexation or Supplemental Declaration, or
any merger or consolidation revoke, modify or add to the covenants established by the
Declaration, nor affect the provisions hereof or thereof as covenants running with the land or
equitable servitudes. The express desired intention of Declarant is to establish a cohesive plan
of such covenants and servitudes to be uniformly applicable to the Project, including those
portions added thereto by annexation.
10.4. RIGHTS AND OBLIGATIONS OF OWNERS.
Upon annexation of an Unannexed Phase to the Association, all Owners in the
Project shall be entitled to the use of any Association Area in such Annexed Phase, subject to
the limitations, conditions and restrictions of this Declaration, and the Owners or Invitees of
Residential Lots located within such Annexed Property shall thereupon be subject to all of the
provisions, covenants, conditions and restrictions of this Declaration. After each annexation, the
assessments shall be assessed in accordance with the provisions set forth in Section 9.12
above with the Annexed Phase being assessed for a proportionate share of the total Common
Expenses on the same basis as the other Residential Lots in the Project. Assessments for the
year that such Unannexed Phase is annexed shall be prorated on the basis of a three-hundred-
sixty (360) day year.
MAGNOLIA AT LA COSTA
DECLARATION 33 CCRS-BY-AOI-DS.DOC
10.5. MERGERS OR CONSOLIDATIONS.
Upon a merger or consolidation of the Association with another association, the
Association's Property, rights and obligations may, by operation of law, be transferred to the
surviving or consolidated association, or, alternatively, the properties, rights and obligations of
another association may, by operation of law, be added to the properties, rights and obligations
of the Association as a surviving corporation pursuant to a merger. The surviving or
consolidated association may administer the covenants, conditions and restrictions established
by this Declaration within the Project, together with the covenants and restrictions established
upon any other property as one plan.
10.6. DE-ANNEXATION.
Declarant may delete all or any portion of the Unannexed Phases or an Annexed
Phase from the coverage of this Declaration and rescind any Declaration of Annexation or
Supplemental Declaration, if any, provided: (a) Declarant is the sole owner of all of the real
property in any such Unannexed or Annexed Phase and (b) the DRE is notified of such De-
Annexation prior to its effective date. Such deletion shall be effective upon the recordation in
the Office of the County Recorder of a "Notice of Deletion of Territory" or a "Declaration of De-
Annexation" signed and acknowledged by Declarant, stating the status of the Phase or portion
of Phase to be deleted and/or de-annexed.
11. USE RESTRICTIONS
11.1. USE OF RESIDENTIAL LOTS.
Residential Lots shall be occupied and used for residential purposes only by the
Owners and their Invitees; provided, however, any Residential Lot may be used as a combined
residence and executive or professional office, or occupations relating to arts and crafts, so long
as such occupations (a) are operated solely within the Residential Lot, (b) are conducted in
conformance with all applicable governmental ordinances, (c) are merely incidental to the use of
the Residential Lot as a residence, (d) the patrons or clientele of such occupation do not
regularly visit or conduct business on the Residential Lot, (e) the business is operated by the
Owner of the Residential Lot whose principal residence is the Residential Lot, by a tenant
whose principal residence is the Residential Lot, or by a member of such Owner's or tenant's
family whose principal residence is the Residential Lot, (f) the operation of the business does
not result in (i) the violation of any of the other provisions of this Declaration, (ii) any
unreasonable increase in the flow of traffic, or the creation of parking problems within the
Project, or (Hi) any odor, noise, or vibration outside of the Residential Lot that interferes with the
quiet enjoyment by other Owners or their Invitees. No other use shall be allowed except as
specifically permitted by local ordinance, or is otherwise authorized by such California statutory
or common law that may take precedence over City requirements and/or this Declaration.
No tent, shack, trailer, garage or structure of a temporary character shall be used
on any Residential Lot at any time as a residence, either temporarily or permanently. The
foregoing notwithstanding, Declarant may use any of the Residential Lots owned or leased by
Declarant as model homes and sales offices during that time period described in Section 13.2
hereinafter.
MAGNOLIA AT LA COSTA
DECLARATION 34 CCRS-BY-AOI-DS.DOC
11.2. LEASE OF DWELLING.
11.2.1. REQUIREMENTS OF ALL LEASES.
Any Owner who wishes to lease his or her Residential Lot and the
Dwelling thereon must meet each and every one of the following requirements, and the lease
will be subject to these requirements whether they are included within a lease or not:
(a) All leases must be in writing;
(b) Unless the Owner remains in occupancy, the lease must
be for the entire Residential Lot, and not merely parts thereof, and shall include the Dwelling
and its garage, and no such lease shall allow the tenant to forfeit the use of such garage;
(c) No lease shall be for a period of less than thirty (30) days;
(d) All leases shall be subject in all respects to the provisions
of this Declaration and the other Project Documents;
11.2.2. FAILURE OF TENANT TO COMPLY WITH PROJECT
DOCUMENTS; OTHER TENANT MATTERS.
(a) Any failure of a tenant to comply with the Project
Documents shall be a default under the lease, regardless of whether the lease so provides. In
the event of any such default, the Owner immediately shall take all actions to cure the default
including, if necessary, eviction of the tenant;
(b) Each Owner shall provide a copy of the Project Documents
to each tenant of his or her Residential Lot. By becoming a tenant, each tenant agrees to be
bound by the Declaration, the Bylaws, the Rules of the Association and any other Project
Document. Anything herein to the contrary notwithstanding, each Owner is responsible and
liable to the Association for the acts or omissions of its tenant, including reasonable attorneys'
fees.
11.3. EXTERIOR COLORS.
Any changes to the exterior colors of Improvements shall be approved by the
Board, provided, however, no permission or approval shall be required to recolor (paint, stucco
color coating, etc.) the exterior of a Dwelling or any accessory building in the same color
scheme as it had been. The provisions of this Section, however, shall not apply to any
Improvements owned by the Declarant or any affiliate or agent of Declarant and the Board shall
have no rights of review or approval with respect thereto.
11.4. ACCESSORY BUILDINGS.
No accessory structures or buildings shall be constructed, placed or maintained
on a Residential Lot except for a detached servant, recreation or guest room structure, and a
private garage; provided, however, no garage shall be constructed prior to the construction of
the main Dwelling. Any accessory building constructed on a Residential Lot shall conform
generally in architectural design, exterior materials and color and roof pitch to the main
Dwelling.
MAGNOLIA AT LA COSTA
DECLARATION 35 CCRS-BY-AOI-DJ.DOC
11.5. REASONABLE CONSTRUCTION TIMEFRAME.
All work of construction being performed on a Residential Lot shall be prosecuted
diligently and continually from the time of commencement of construction until the same shall be
fully completed, excepting therefrom causes beyond the control of the Lot Owner, such as
strikes, Acts of God, etc. The Owner of a Lot where a building structure has been damaged or
destroyed by fire or other calamity shall cause such structure to be repaired or restored within a
reasonable time, commencing within six (6) months after the damage occurs and be completed
within one year thereafter, unless prevented by causes beyond his or her reasonable control.
This obligation shall not extend to the installation of furniture or the like, but shall be for the
purpose of preventing unsightliness caused by such damage or destruction and any resultant
health or safety problems to other Owners or occupants within the Property or neighborhood.
11.6. SCREENDOORS; AWNINGS; WINDOWS.
No screendoor on the front or main entrance door or doors, or any aluminum or
metal awnings, covers, sunshades or ornamental screens shall be erected or maintained on or
around any portion of a Dwelling or accessory building or elsewhere within the Project except
those that are installed with the original construction of the Project or as authorized and
approved by the Board.
11.7. WINDOW COVERINGS.
Temporary window coverings ("Temporary Window Coverings") in a design and
color that does not conflict with surrounding Improvements shall be permitted for a maximum
period of sixty (60) days from the date that a Residential Lot with a Dwelling constructed thereon
by Declarant is conveyed to an Owner by Declarant; provided, however, no window shall ever
be covered with paint, aluminum foil, newspapers or any other contrasting material). Non-
reflective solar films, however, may be used.
11.8. PETS.
Except as otherwise provided more stringently in the zoning ordinances of the
City, an Owner may keep and maintain on his or her Residential Lot domesticated pets such as
dogs, cats or other usual and ordinary household pets as may be allowed by the Association
Rules, if any; provided, however, any pet which may have already been allowed prior to the
adoption of a Rule that would preclude such pet, shall be exempt from such Rule for the lifetime
of such pet or pets; further provided, that the above pets shall not be kept, maintained or bred
for any commercial purposes. Under no circumstances shall poultry, birds of prey, goats,
bovine or swine be permitted. The foregoing notwithstanding, no pets may be kept on the
Property which result in an annoyance or are obnoxious to other Owners or occupants;
provided, however, that the Association Rules may further limit or restrict the keeping of such
pets. No pets shall be permitted in any area designated in the Association Rules as being
restricted to pets. No dog whose prolonged barking (or other prolonged noise-producing pet)
unreasonably disturbs other Owners or occupants shall be permitted to remain in the Project
Persons bringing or keeping a pet within the Project shall prevent their pets from soiling all
portions of the Project where other persons customarily walk or otherwise occupy from time to
time and shall promptly clean up any mess left by their pets. Each person bringing or keeping a
pet within the Project shall be absolutely liable to the Association and other Owners and their
MAGNOLIA AT LA COSTA
DECLARATION 36 CCRS-BY-AOI-DS.DOC
invitees for any damage to persons or property caused by any pet brought upon or kept upon
the Project by such person or such Owner's Invitees.
11.9. SIGNS.
No signs, placards, decals or other similar objects, visible from neighboring
property or streets, shall be erected or displayed on any Residential Lot or the Association Area,
which are not in conformance with governmental ordinances or the Architectural Standards.
Anything contained in this Declaration to the contrary notwithstanding, Declarant
and its authorized agents, shall have the right, during the time period described in the
Article 12.1 entitled DEVELOPMENT RIGHTS, to install and maintain such Construction and
Marketing Improvements as provided in such Article.
11.10. EXTERIOR LIGHTING.
Any exterior landscape lighting or exterior lighting installed on a Dwelling shall
either be indirect, shielded or of such controlled focus and intensity as to prevent glare on
surrounding properties and unreasonable disturbance to occupants of other Dwellings in the
neighborhood.
11.11. SOLAR ACCESS.
Subject to the provisions for Architectural Committee approval contained in
Section 12.9 entitled "Approval of Solar Energy Systems," all Residential Lots within the
Community shall have a right to a minimum of one hundred (100) square feet of solar access.
No vegetation shall be planted or improvement maintained on any Lot in such a location or at
such a height as to unreasonably obstruct the rays of the sun from a solar collector installed on
another Lot in the Community. The foregoing notwithstanding, should solar collectors be
installed at a later date, the cost of removing or modifying the established landscaping upon an
adjoining Lot shall be the responsibility of the Owner benefiting from the solar access. The
Owner installing the solar collectors shall place the solar collectors in a location as to minimize
any impact upon adjoining Lots.
11.12. ANTENNAS, SATELLITE DISHES.
No alteration to or modification of a central radio and/or television antenna
system or cable television system, whichever is applicable, if developed by Declarant, a cable
television franchisee or third party utility service, and is maintained by the Association or said
franchisee or utility service, shall be permitted. No Owner or Invitee may be permitted to
construct and/or use and operate his own external radio and/or television antenna, "Citizens
Band" (C.B.), amateur radio, microwave transmission, satellite dishes, DBS dishes or other
similar electronic receiving or broadcasting devices, except in accordance with the
Association Rules and/or Architectural Standards promulgated therefor and in
compliance with all local, state and federal laws and regulations, as they may from time to time
be amended. Nothing herein stated is intended to obligate Declarant or the Board to install a
master antenna system. All fees for the use of any cable television system shall be borne by
the respective Owners, and not by the Association or Declarant.
MAGNOLIA AT LA COSTA
DECLARATION 37 CCRS-BY-AOI-DJ.DOC
11.13. POST TENSION SLABS.
The Dwellings on some or all of the Lots may have been constructed with post-
tensioned concrete slabs ("System"). The System involves placing steel cables under high
tension in the concrete slab located beneath the Dwelling. Each Owner shall be responsible for
determining whether the Dwelling on his or her Lot has been constructed with a System. Any
attempt by an Owner or other person to alter or pierce the foundation (e.g., saw cutting or
drilling) could damage the integrity of the System and/or cause serious injury or damage to
persons and property. No Owner shall cut into or otherwise disturb the System upon which the
Dwelling on his or her Lot is constructed. The Owner of each Lot on which the residence has
been constructed with a System agrees, by acceptance of a Deed to the Lot, that neither
Declarant nor any contractor of Declarant shall be responsible for any damage or injury resulting
from or arising in connection with the alteration or piercing by the Owner or Invitee thereof of the
slab or the foundation or the Dwelling on the Lot. Each Owner shall hold Declarant harmless
from and indemnify Declarant against all claims, demands, losses, costs (including attorney's
fees), obligations and liability arising out of or in connection with the failure of the Owner to
comply with the provisions of this Section.
11.14. OFFENSIVE ACTIVITIES AND CONDITIONS.
No noxious or offensive activity shall be carried on upon any Lot, or on the
Association Area. No odor shall be permitted to arise from a Lot which renders the Lot or any
portion thereof unsanitary, unsightly or offensive to any portion of the Project or to its occupants.
No noise or other nuisance shall be permitted to exist or operate upon any portion of a Lot so as
to be unreasonably offensive or detrimental to any other part of the Project or to its occupants.
No exterior speakers, horns, whistles, bells or other sound devices (other than security devices
used exclusively for security purposes) which unreasonably disturb other Owner or their tenants
shall be located, used or placed on any Lot. Alarm devices used exclusively to protect the
security of a Dwelling and its contents shall be permitted, provided that the devices do not
produce annoying sound or conditions as a result of frequently occurring false alarms.
11.15. GARBAGE AND REFUSE DISPOSAL.
(a) All rubbish, trash and garbage shall be regularly removed from
Residential Lots and Association Area, and shall not be allowed to accumulate thereon. Trash,
garbage and other waste shall not be kept except in sanitary containers designed for such
purpose. The Board may require, pursuant to its Rules, that all garbage and other wastes be
segregated and such segregated elements be separately packaged (for example, all cans,
glass, paper products and other items of trash be segregated from each other and separate
packaged for pickup and disposal by a garbage and waste disposal company or a department of
any governmental agency having jurisdiction over the Project). All equipment for storage or
disposal of such materials shall be kept in a clean and sanitary condition. All equipment, trash
bins or cans shall be kept screened and concealed from view of other Lots and the Association
Area.
11.16. CLOTHES LINES.
Except with written permission from the Board, outside clotheslines or other
outside clothes drying or airing facilities shall be prohibited.
MAGNOLIA AT LA COSTA
DECLARATION 38 CCRS-BY-AOI-DXDOC
11.17. LANDSCAPING; VACANT LOTS.
Unless Declarant has installed the landscaping for a Residential Lot, within six
(6) months after the conveyance of the Residential Lot by Declarant to a Retail Buyer, the
Owner shall install and shall thereafter maintain plants, shrubs, trees and any other appropriate
landscaping improvements, pursuant to plans and specifications approved by the Board, on
those portions of the Lot which are visible from any street within the Project. Landscaping shall
at all times be maintained in an attractive and well-maintained condition, subject to any water
restrictions that may from time to time be imposed by a local water district or other
governmental or quasi-governmental jurisdiction.
11.18. VEHICLE RESTRICTIONS.
11.18.1. PROHIBITED VEHICLES.
No house trailer, bus, trucks over 1 ton, commercial vehicles
(except as described in "Permitted Vehicles" below), permanent tent or similar equipment
shall be permitted to remain upon any area within the Community other than parked temporarily
for purposes of loading, unloading. "Temporary parking" shall mean parking of vehicles
belonging to Invitees or Owners, delivery trucks, service vehicles and other commercial vehicles
being used in the furnishing of services to the Association or the Owner and parking of vehicles
belonging to or being used by Owners for loading and unloading purposes only. No noisy or
smoky vehicles shall be operated in the Community.
11.18.2. RESTRICTED VEHICLES.
No truck camper (excepting a pick-up truck with a camper shell) ,
camper trailer, recreational vehicle or camper, recreational motor home, horse trailer, boat, golf
cart, all-terrain vehicle (ATV), inoperable or unlicensed vehicle shall be permitted to remain
upon any area within the Community in such a manner that it is visible from neighboring
property or adjacent streets. Motorcycles and motorbikes shall be permitted, provided they are
operated at noise levels not exceeding 45 decibels. The storing, placing or parking of any
vehicle, or any part thereof, which is disabled, unlicensed, unregistered, inoperative, or from
which an essential or legally required operating part is removed, shall be prohibited unless
conducted within a garage.
11.18.3. PERMITTED VEHICLES.
Automobiles, standard-sized vans and pickup trucks (including
pickup trucks with a camper shell) shall be permitted vehicles within the Community. Permitted
commercial vehicles shall include automobiles or standard sized vans and pickup trucks which
are used both for business and personal use, provided that any signs or markings of a
commercial nature on such vehicles shall be unobtrusive and inoffensive as determined by the
Board.
11.18.4. CONSTRUCTION AND SALES.
Declarant, or Declarant's successor in interest, may maintain such"
trailers or temporary construction shelters or facilities within the Property which are related to
the construction or sale of Residential Lots and improvements thereon and within the Property,
in accordance with the provisions therefor contained in ARTICLE 12.1 herein.
MAGNOLIA AT LA COSTA
DECLARATION 39 CCRS-BY-AOI-DS.DOC
11.19. OFF-SITE STORAGE - RECREATIONAL VEHICLES.
Pursuant to Item No. 21 of the Conditions of Approval of City of Carlsbad City
Council Resolution No. 97-595 passed, approved and adopted at a regular meeting of the City
Council of the City of Carlsbad, California on September 2, 1997, for so long as the Project shall
exist as a Common Interest Development, the Association shall be obligated to provide or cause
to be provided, a minimum of 580 square feet of recreational vehicle (RV) storage area off-site
and within a maximum ten (10) mile radius of the Project, for use by Residents on a first come,
first serve basis.
11.20. USE OF GARAGES; PARKING.
When garages are not in use, garage doors shall be closed. Garages shall be
used only for the purpose of parking automobiles and other vehicles and equipment and
storing an Owner's household goods, provided, however, that all such uses shall be
accomplished so that garage doors can be closed. Garages shall not be converted into any use
(such as recreational room) that would prevent its use as parking space for the number of
vehicles the garage was designed to contain. Owners are to use their garages and driveways
for parking of their vehicles. Parking of vehicles on Residential Lots shall be conducted on
paved surfaces only; there shall be no parking of vehicles on unpaved surfaces, such as lawns
or dirt surfaces.
11.21. TOWING.
(a) Any vehicle within the Community parked in violation of this Declaration
or the Association Rules may be removed as provided for in accordance with the provisions of
California Vehicle Code Section 22658.2 and any amendments thereto, or in accordance with
City ordinances.
(b) Notwithstanding the foregoing, the Association may cause the removal,
without notice, of any vehicle parked in a marked fire lane, within fifteen (15) feet of a fire
hydrant, or in a manner which interferes with any entrance to or exit from the Project or any
Residential Lot, parking space, garage or driveway located thereon.
(c) The Association shall not be liable for any damages incurred by the
vehicle owner because of the removal in compliance with this Section or for any damage to the
vehicle caused by the removal, unless such damage resulted from the intentional or negligent
act of the Association or any person causing the removal of or removing the vehicle. If
requested by the owner of the vehicle, the Association shall state the grounds for the removal of
the vehicle.
11.22. WELLS; SEPTIC TANKS.
No well or septic tank shall be located and constructed in the Project.
11.23. LIABILITY FOR DAMAGE TO ASSOCIATION AREA.
Each Owner shall be liable to the Association and to the remaining Owners for
any damage to the Association Area that may be sustained by reasons of the negligence of that
Owner, his or her Invitees or any occupant of such Owner's Dwelling, as such liability may be
determined under California law. Each Owner shall be responsible for compliance with the
MAGNOLIA AT LA COSTA
DECLARATION 40 CCRS-BY-AOI-DS-DOC
provisions of the Declaration, Articles, Bylaws and Rules of the Board by his or her Invitees, and
shall, after written notice and an appointment for a hearing, pay the fines and penalties
assessed pursuant hereto, the Bylaws or Board rules for any violation by his or her Invitees.
11.24. RESTRICTIONS ON FURTHER SUBDIVISION.
No Residential Lot shall be further subdivided nor shall less than all of any such
Residential Lot be conveyed by an Owner thereof; provided, however, that nothing in this
Section shall be deemed to prevent an Owner, including Declarant, from adjusting the boundary
of a Lot by boundary adjustment or parcel map.
11.25. INDEMNIFICATION.
Each Owner shall be liable to the remaining Owners for any damage to the
Association Area or to any other Residential Lot that may be sustained by reason of the
negligence or willful misconduct of that Owner, or the Owner's Invitees, but only to the extent
that any such damage is not covered by insurance of the Association. Each Owner, by
acceptance of his or her deed, agrees for himself or herself and for the Owner's Invitees, to
indemnify each and every other Owner, and to hold each Owner harmless from, and to defend
each Owner against, any claim of any person for personal injury or property damage caused by
the negligence or willful misconduct of such Owner, occurring within the Residential Lot of that
particular Owner unless the injury or damage occurred by reason of the negligence or willful
misconduct of any other Owner or the Association or is fully covered by insurance covered by
the Association.
12. ARCHITECTURAL AND DESIGN CONTROL
12.1. APPROVAL FOR ARCHITECTURAL AND DESIGN MATTERS.
Each Owner, other than Declarant, shall obtain the approval of the Board for any
modification or installation of Improvements in accordance with the provisions set forth below.
12.2. GENERAL.
(a) The powers and duties set forth in this Article shall be vested in, and
exercised by the Board of Directors of the Association; provided, however, the Board may, upon
unanimous approval thereof, delegate its powers and duties to an Architectural Committee
consisting of not less than three (3) nor more than five (5)members, in which case all references
to the "Board" herein, where appropriate, shall be construed thereafter to refer to the
"Architectural Committee." in the event the Board elects to delegate such powers to an
Architectural Committee, prior to conversion of the Class B membership in the Association to
Class A membership, Declarant may appoint all of the original members of the Committee and
all replacements until the first(lst) anniversary of the conveyance of the first Residential Lot in
the first Phase of the Project under the authority of a Public Report; additionally, Declarant
reserves to itself the power to appoint a majority of the members to the Committee until ninety
percent (90%) of all the Lots in the Project have been sold or until the fifth (5th) anniversary of
the conveyance of the first Residential Lot in the first Phase of the Project under the authority of
a Public Report, whichever first occurs. Thereafter, the Board shall have the power to appoint
and remove all of the members of the Architectural Committee. Members appointed to the
MAGNOLIA AT LA COSTA
DECLARATION 41 CCRS-BY-AOI-DS-DOC
Architectural Committee by the Board shall be from the membership of the Association.
Members appointed to the Architectural Committee by the Declarant need not be members of
the Association. A majority of the Architectural Committee may designate a representative to
act for it. In the event of death or resignation of any member of the Architectural Committee,
the successor shall be appointed by the person, entity or group which appointed such member
until Declarant no longer has the right to appoint any members to the Architectural
Committee, and thereafter the Board shall appoint such a successor.
12.3. DUTIES.
The Board shall consider and act upon such proposals or plans submitted to it as
described herein and pursuant to the terms hereof and to the extent it may otherwise be granted
such additional authorities and delegation of responsibilities.
12.4. MEETINGS; VOTING; WRITTEN CONSENT.
The Board shall meet from time to time as necessary to properly perform its
duties hereunder. The vote or written consent of at least a fifty-one percent (51%) majority of
the members of the Board shall constitute an act by the Board for purposes of architectural
matters herein, unless the unanimous decision of its members is otherwise required by this
Declaration. The Board shall keep and maintain a record of all actions taken by it at such
meeting or otherwise.
12.5. SCOPE.
No Improvements of any kind whatsoever shall be commenced, erected, placed
or altered upon or around any Residential Lot until the location and the complete plans and
specifications showing the nature, kind, shape, height and materials, including the color ("Plans
and Specifications"), have been submitted to and approved in writing as to harmony of
external design and location to surrounding structures and topography by the Board. In
addition, the grade, level or drainage characteristics of the Residential Lot or any portion thereof
shall not be altered without the prior written consent of the Board.
12.6. ARCHITECTURAL STANDARDS.
The Board may, from time to time and in its sole discretion, adopt, amend and
repeal, by unanimous vote, rules and regulations to be known as "Architectural Standards." The
Architectural Standards shall interpret and implement the provisions hereof by setting forth
the standards and procedures for Board review and guidelines for architectural design of
Improvements, placement of Improvements, color schemes, exterior finishes and which are
recommended for use in the Project; provided, however, that said rules shall not be in
derogation of the standards required by this Declaration, materials and similar features The
Architectural Standards may provide for the pre-approval or exemption from approval of
certain specified types or categories of improvements, provided that such pre-approved or
exempted construction activities are implemented by the affected Owner in conformance with
the standards for design, materials and other criteria established in the Architectural
Standards for such pre-approved or exempted construction activities. The Board may from
time to time adopt, supplement or amend the Architectural Standards to establish, expand,
limit or otherwise modify the categories and criteria for any pre-approved or exempted
construction activities.
MAGNOLIA AT LA COSTA
DECLARATION 42 CCRS-BY-AOI-DJ.DOC
12.7. APPROVAL OF PLANS & SPECIFICATIONS BY ARCHITECTURAL
COMMITTEE.
Any Owner proposing to construct Improvements taking other actions requiring
the prior approval of the Board pursuant to this Declaration shall first apply to the Board for
preliminary approval by submission of preliminary drawings of the proposed Improvements in
accordance with the Architectural Standards, if any. The purpose of the preliminary approval
procedure is to allow an Owner proposing to construct Improvements an opportunity to obtain
guidance concerning design considerations before expending substantial sums for plans and
other exhibits required to apply for final approval. Applications for preliminary approval shall be
considered and disposed of asset forth below.
12.8. PRELIMINARY APPROVAL.
12.8.1. TIME PERIODS FOR REVIEW.
Within thirty (30) days after proper application for preliminary
approval, the Board shall consider and act upon such request. The Board shall grant such
approval only if the proposed Improvements, to the extent its nature and characteristics are
shown by the application, would be entitled to a final approval on the basis of a full and
complete application. In the event the Board fails to approve or disapprove any such preliminary
plans within thirty (30) days after all documents and information requested by the Board have
been received by it, the Owner requesting said approval may submit a written notice to the
Board advising the same of its failure to act. If the Board fails to approve or disapprove any such
preliminary plans within fifteen (15) days after the receipt of said notice from such Owner, said
preliminary plans shall be deemed approved, provided that any Improvements conform to all
conditions and restrictions contained in this Article and are in harmony with similar structures
erected within the Project. In granting or denying approval, the Board may give the applicant
such directions concerning the form and substance of the final application for approval as it may
deem proper or desirable for the guidance of the applicant. The giving of any preliminary
approval shall not affect the right of the Board to deny approval of any final Plans and
Specifications which are in substantial conformance with the approved preliminary Plans and
Specifications.
12.8.2. EFFECTIVENESS OF APPROVAL
Any preliminary approval granted by the Board as provided above
shall be effective for a period of ninety (90) days from the date of the issuance thereof In no
event shall any preliminary approval be deemed to be an approval authorizing construction of
the subject Improvements.
12.8.3. FINAL APPROVAL
During the ninety (90) day preliminary approval period described
above, any application for final approval which consists of proposed Improvements in
accordance with the provisions of the preliminary approval, and is otherwise acceptable under
the terms of this Declaration and the Architectural Standards, shall be approved by the Board
as set forth below.
MAGNOLIA AT LA COSTA
DECLARATION 43 CCRS-BY-AOI-DJ.DOC
12.8.4. TIME PERIODS FOR REVIEW.
Within thirty (30) days after proper application for final approval,
the Board shall consider and act upon such application. In the event the Board fails to approve
or disapprove any such final plans within thirty (30) days after all documents and information
requested by the Board have been received by it, the Owner requesting said approval may
submit a written notice to the Board advising the same of its failure to act. If the Board fails to
approve or disapprove any such final plans within thirty (30) days after the receipt of said notice
from such Owner, said final plans shall be deemed approved, provided that the proposed
Improvements conform to all conditions and restrictions contained in this Article and are in
harmony with similar structures erected within the Project.
12.9. APPROVAL OF SOLAR ENERGY SYSTEMS.
Any Owner proposing to install or use a solar energy system, as defined in Civil
Code Section 801.5, shall be subject to the same review and approval process as any owner
proposing to construction any Improvements or other actions requiring the approval of the Board
pursuant to this Declaration. However, only reasonable restrictions on the installation and use of
a solar energy system shall be permitted. Reasonable restrictions on a solar energy system are
those restrictions which do not significant increase the cost of the system or significantly its
sufficiency or specified performance, or which allow for an alternative system of comparable
costs, efficiency, and energy conservation benefits.
12.10. INSPECTION AND CORRECTION OF WORK.
The Board, or its duly authorized representative, shall have the right to enter onto
the exterior of the Residential Lot (but not into the Dwelling) to inspect such Improvement to
determine whether it was constructed, reconstructed, altered or refinished to substantial
compliance with the approved Plans and Specifications. If the Board finds that such
construction, reconstruction, alteration or refinishing was not done in substantial compliance
with the approved Plans and Specifications, it shall notify the Owner in writing of such non-
compliance within such thirty (30) day period, specifying particulars of non-compliance, and
shall require the Owner to remedy such non-compliance. If such Owner fails to comply with the
written directive from the Board, the Board shall have the right and authority to enforce,
pursuant to the "Enforcement" Article hereinafter, the performance of the subject matter of such
directive, including, if necessary, the right to enter onto the Residential Lot where a violation of
these restrictions exists and perform remedial work, and the cost of such performance shall be
charged to the Owner of the Residential Lot in question. Such costs shall be due within five (5)
days after receipt of written demand therefor, and shall bear interest at the maximum rate
allowed by law. If such costs are not promptly repaid by the Owner to the Association, the
Board shall levy an Enforcement Assessment against such Owner for reimbursement.
12.11. FAILURE TO NOTIFY.
If for any reason the Board fails to notify the Owner of any non-compliance within
sixty (60) days after receipt of said notice of completion from the Owner, the Improvement shall
be deemed to be in accordance with said approved Plans and Specifications.
MAGNOLIA AT LA COSTA
DECLARATION 44 CCRS-BY-AOI-DS.DOC
12.12. ENTRY INTO DWELLING.
Notwithstanding anything to the contrary set forth herein, nothing contained in
this Article shall give to the Association the right to enter onto the interior of any Dwelling.
12.13. DILIGENCE IN CONSTRUCTION.
Upon final approval of any Plans and Specifications, the Owner(s) shall promptly
commence construction and diligently pursue the same to completion.
12.13.1. FEE FOR REVIEW.
The Board shall have the right to establish a reasonable fee for
the review and approval of Plans and Specifications which must be submitted to it pursuant to
the provisions of this Article or the Bylaws, which shall be reasonably related to the duties
performed and to cover any expense incurred in obtaining professional review assistance from
licensed engineers, architects or contractors.
12.14. INTERPRETATION.
All questions of interpretation or construction of any of the terms or conditions
herein shall be resolved by the Board and its decision shall be final, binding and conclusive on
all of the parties affected.
12.15. WAIVER.
The approval by the Board of any plans, drawings or specifications for any work
done or proposed, or for any other matter requiring the approval of the Board under this
Declaration, shall not be deemed to constitute a waiver of any right to withhold approval of any
similar plan, drawing, specification or matter subsequently submitted for approval.
12.16. ESTOPPEL CERTIFICATE.
Within thirty (30) days after written demand is delivered to the Board by any
Owner, and upon payment to the Association of a reasonable fee (as fixed from time to time by
the Association), the Board shall record an estoppel certificate, executed by any two (2) of its
members, certifying (with respect to any Residential Lot of said Owner) that as of the date
thereof, either; (a) all Improvements made and other work completed by said Owner comply
with this Declaration, or (b) such Improvements or work do not so comply, in which event the
certificate shall also identify the non-complying Improvements or work and set forth with
particularity the basis of such non-compliance. Any purchaser from the Owner, or from anyone
deriving any interest in said Residential Lot through him, shill be entitled to rely on said
certificate with respect to the matters therein set forth, such matters being conclusive as
between the Association, Declarant and all Owners and such persons deriving any interest
through them.
12.17. LIABILITY.
The Board shall not be liable to the Association or to any Owner for any damage,
loss or prejudice suffered or claimed on account of: (a) the approval or disapproval of any plans,
drawings and specifications, whether or not defective; (b) the construction or performance of
MAGNOLIA AT LA COSTA
DECLARATION 45 ccRs-BY-Aoi.03.ooc
any work, whether or not pursuant to approved plans, drawings, and specifications; (c) the
Project of any property within the Project; or (d) the execution and filing of an estoppel certificate
pursuant to Section 12.16, whether or not the facts therein are correct; provided, however, that
such Board member has acted in good faith on the basis of such information as may be
possessed by him. Without in any way limiting the generality of the foregoing, the Board or any
member thereof may, but is not required to, consult with or hear the views of the Association or
any Owner with respect to any plans, drawings, specifications or any other proposal submitted
to the Board.
12.18. NON-APPLICABILITY TO DECLARANT; BUILDER.
12.18.1. DECLARANT, BUILDER NON-APPLICABILITY.
Any provisions of this Article, this Declaration or any other Project Document
shall not apply to any Improvements installed or to be installed by the Declarant, or any affiliate
or agent of Declarant, or any Builder (subject to Declarant controlled limitations described in the
Section hereafter), and neither the Board, its delegated Architectural Committee, nor any
Member shall have any rights of review, approval or denial with respect thereto.
12.18.2. BUILDER REQUIREMENTS.
A Builder shall be exempt from the provisions hereof as to any
Improvements which the Builder proposes be constructed on a Residential Lot, in the same
manner as Declarant, subject to the following limitations: within five (5) years following the
conveyance of the first Residential Lot in the Project to a Retail Buyer under the authority of a
Public Report, any Improvements which a Builder proposes to construct, shall require prior
written approval by Declarant; thereafter, prior written approval by the Board or its delegated
Architectural Committee shall be required.
12.19. GOVERNMENT REQUIREMENTS.
The application to and the review and approval by the Board of any proposals,
plans or other submittals shall in no way be deemed to be satisfaction of or compliance with any
building permit process or any other governmental requirements, the responsibility for which
shall like lie solely with the respective Owner.
12.20. AMENDMENTS.
Notwithstanding Article 19 hereof entitled AMENDMENTS, no amendment,
verification or rescission of this Article may be had, nor shall Declarant, or any successor
thereof, be prohibited from completing the construction of the Project prior to the conveyance by
Declarant, or its successor, of the last Residential Lot in the Property without (a) written consent
of Declarant, and (b) the recording of such consent in the Office of the County Recorder. Such
written consent shall not be required after the conveyance by Declarant (or its successors) of all
the Residential Lots in the Property to Retail Buyers.
12.21. VARIANCES.
The Board may authorize variances from compliance with any of the architectural
provisions of this Declaration. Such variances must be in writing, and must be signed and
acknowledge by at least a majority of the members of the Board. The granting of a variance
MAGNOLIA AT LA COSTA
DECLARATION 46 CCRS-BY-AOI-DJ.DOC
shall not operate to waive any of the terms and provisions of this Declaration for any purpose
except as to the particular property and particular Residential Lot and particular provision hereof
covered by the variance, nor shall it affect in any way affect the Owner's obligation to comply
with all governmental laws and regulations affecting its use of the Residential Lot, including, but
not limited to, zoning ordinances and lot setback lines or requirements imposed by the City or
any other governmental authority.
13. DEVELOPMENT RIGHTS
13.1. LIMITATION OF RESTRICTIONS.
Declarant is undertaking the work of developing Residential Lots and other
Improvements within the Property. The completion of that work and the marketing, sale, rental
and other disposition of the Residential Lots is essential to the establishment and welfare of the
Property as a residential community. In order that said work may be completed and said Project
be established as a fully occupied residential community as rapidly as possible, nothing in this
Declaration shall be interpreted to deny Declarant the rights set forth in this Article.
13.2. RIGHTS OF ACCESS; COMPLETION; MARKETING.
Until (a) all the Residential Lots in the Project are sold and conveyed by
Declarant to Retail Buyers or other Persons, or, (b) the third (3rd) anniversary of the
conveyance of the first Residential Lot in the first Annexed Phase of the Project to a Retail
Buyer under the authority of a Public Report, whichever shall first occur, Declarant, its
contractors and subcontractors shall have the rights set forth below.
13.2.1. ACCESS.
Declarant, its contractors and subcontractors shall have the right
to obtain reasonable access over and across the roadways and accessways within the
Community and Association Areas, or do within any Residential Lot owned by it whatever is
reasonably necessary or advisable in connection with the completion of the Project and the
marketing and maintenance thereof.
13.2.2. CONSTRUCTION IMPROVEMENTS.
Declarant, its contractors and subcontractors shall have an
easement and right to erect, construct and maintain on the Association Area of the Project or
within any Residential Lot owned by it, such structures or improvements, including, but not
limited to, sales offices, flags, balloons, banners and signs, as may be reasonably necessary for
the conduct of its business to complete the work, establish the Project as a residential
community and dispose of the Residential Lots by sale, lease or otherwise, as determined by
Declarant in its sole discretion and to perform or complete any work to improvements required
for Declarant to obtain a release of any bonds posted by Declarant with the City.
13.2.3. GRANT EASEMENTS.
Declarant, its contractors and subcontractors shall have the right
to establish and/or grant over and across the Association Area such rights of way on, over,
MAGNOLIA AT LA COSTA
DECLARATION 47 CCRS-BY-AOMM.DOC
under or across all or any part thereof to or for the benefit of the State of California, the City, or
any other political subdivision or public organization, any public utility entity, cable or other
television signal provider, or any online computer access provider, for the purpose of
constructing, erecting, operating and maintaining facilities and improvements thereon, therein or
thereunder at that time or at any time in the future, including: (a) poles, wires and conduits for
transmission of electricity, providing telephone, television or online computer services and for
the necessary attachments in connection therewith, and (b) public and private sewers, sewage
disposal systems, storm water drains, land drains and pipes, water systems, sprinkling systems,
water, heating and gas lines or pipes and any and all equipment in connection therewith. The
Association Area shall be subject to any dedication stated in the Subdivision Map for the Project
of an easement for public use for installation, maintenance and operation of facilities for public
utilities over all or any part of the Association Area. Said public utilities easement over the
Association Area shall inure and run to all franchised utility companies and to the City and shall
include the right of ingress and egress over the Association Area by vehicles of the City and
such utility companies to properly install, maintain, repair, replace and otherwise service such
utility facilities. The grant of said public utility easement shall not be interpreted to imply any
obligation or responsibility of any such utility company or the City for maintenance or operation
of any of the Association Area or the facilities located thereon or the repair, replacement or
reconstruction thereof except as occasioned by such utility companies, the City of the utility
facilities for which they are responsible. The Association Area shall also be subject to any
easements granted by Declarant to any public or private entity for cellular, cable, computer or
other similar transmission lines. Except for lawful and proper fences, structures and facilities
placed upon the Association Area by utility companies, the Association Area subject to the
public utility easement shall be kept open and free from buildings and structures. The City and
the County, furthermore, are granted an easement across the Association Area for ingress and
egress for use by emergency vehicles of the City and County.
13.2.4. MARKETING RIGHTS.
(A) GENERAL RIGHTS.
Subject to the limitations of this Declaration, Declarant shall have
the right to:
(1) Maintain model homes, sales offices, trailers,
temporary construction shelters, storage areas and related facilities in any unsold Residential
Lot or portion of the Association Areas, as are necessary or reasonable in the opinion of
Declarant for the construction, sale, or disposition of the Residential Lots, Dwellings or other
Improvements with the Properly;
(2) Make reasonable use of the Association Areas and
facilities for the sale of Residential Lots;
(3) Post signs, flags, balloon and banners within the
Association Areas and unsold Residential Lots in connection with its marketing of Residential
Lots; and
(4) Conduct its business of disposing of Residential
Lots by sale, lease or otherwise.
MAGNOLIA AT LA COSTA
DECLARATION 48 CCRS-BY-AOI-DJ.DOC
(B) AGREEMENT FOR EXTENDED USE.
If, following the third (3rd) anniversary of the conveyance
of the first Residential Lot in the first Annexed Phase of the Project to a Retail Buyer under the
authority of a Public Report, or, upon the conveyance of the last Residential Lot in the Property,
whichever first occurs, Declarant requires use of any portion of the Association Area for
marketing and/or construction purposes, Declarant may use the Association Area only if an
agreement is entered into between Declarant and the Association, subject to any limitations as
may exist with respect to the use of an Association Easement as described in this Declaration,
other instrument recorded with the County Recorder, or as by an agreement between the
Association and the servient tenement of an Association Easement (i.e. the Residential Lot
Owner and/or the owner of the real property over which the Slope Maintenance Easement
exists).. The Association shall not unreasonably withhold entering into such agreement, on
such terms and conditions as may be mutually agreed upon, or, if an terms and conditions
cannot be agreed upon, then upon such terms and conditions as may be prevalent in similar
projects in the County. In the event no action is taken, Declarant shall be required to terminate
and remove all marketing and construction-related facilities upon thirty (30) days written notice
from the Association to Declarant.
13.2.5. SIZE AND APPEARANCE OF PROJECT.
Declarant shall not be prevented from increasing or decreasing
the number of Residential Lots that may, pursuant to the provisions of Article 3.57, be annexed
to the Project or from changing the exterior appearance of the Residential Lot Dwellings or any
other Improvements structures, the landscaping or any other improvement or matter directly or
indirectly connected with the Project in any manner deemed desirable by Declarant, if Declarant
obtains such governmental consents therefor as may be required by law.
13.3. ASSIGNABILITY OF RIGHTS.
The rights of Declarant under this Declaration may be assigned to any
successor(s) by an express assignment in a recorded instrument, including without limitation a
deed, option or lease. This Declaration shall not be construed to limit the right of Declaration at
any time prior to such assignment to establish additional licenses, reservations and rights-of-
way to itself, to utility companies or to others as may be reasonably necessary to the proper
development and disposal of property owned by Declarant.
13.4. TERMINATION OF ANY RESPONSIBILITY OF DECLARANT.
In the event Declarant shall convey all of its rights, title and interest in and to the
Property to any partnership, individual or individuals, corporation or corporations, then and in
such event, Declarant shall be relieved of the performance of any further duty or obligation
hereunder, and such partnership, individual or individuals, corporation or corporations, shall be
obligated to perform all such duties and obligations of the Declarant.
13.5. AMENDMENT.
The provisions of this Article may not be amended without the consent of
Declarant (or its duly authorized successor in interests) until such time that all of the Residential
Lots in the Project owned by Declarant have been conveyed to Retail Buyers.
MAGNOLIA AT LA COSTA
DECLARATION 49 CCRS-BY-AOI-DS.DOC
14. RESPONSIBILITIES OF MAINTENANCE
14.1. MAINTENANCE OBLIGATIONS OF OWNER.
14.1.1. OVERALL MAINTENANCE OF RESIDENTIAL LOTS.
Except for the Association Areas, the maintenance of which shall
be the responsibility of the Association, each Owner shall maintain, repair and otherwise care
for the maintenance, repair and replacement of the Owner's Residential Lot and all
Improvements situated therein, in a good condition of maintenance and repair.
14.1.2. DRAINAGE.
Each Owner shall periodically inspect and perform such
reasonable and normal maintenance as necessary to keep any drainage systems located on or
under his or her Residential Lot in proper working order and free from debris and obstructions
which may change the direction or retard the flow of water.
14.1.3. MAINTENANCE OF FENCES OR WALLS.
(A) OWNER MAINTENANCE OBLIGATIONS.
Each Owner shall have the obligation to maintain in a good
condition of maintenance and repair the interior and exterior of any fencing located exclusively
within the boundaries of such Owner's Residential Lot and not shared with an adjacent Owner
or with a Association Area for which the Association is responsible;
(B) BETWEEN TWO RESIDENTIAL LOTS.
For any fence or wall which separates two (2)
Residential Lots, each Owner shall have the obligation to maintain the interior of the fence or
wall; however, both Owners shall share, on an equitable basis, the cost of replacing such fence
or wall. The Owner of each affected portion of the Residential Lots on which a party wall or
fence is located shall have a reciprocal non-exclusive easement to the Residential Lot
immediately adjacent to the fence or wall for the limited purpose and only to the extent
necessary to maintain the party wall, fence;
(C) RESIDENTIAL LOT AND ASSOCIATION AREA.
For any fence or wall which separates a portion of a
Residential Lot and the Association Area, the Owner of such Residential Lot shall have the
obligation to paint, stain and otherwise maintain the fence or wall, with the exception of the
street-facing surface of any fence or wall located on that Residential Lot, the responsibility of
which shall belong to the Association. However, the cost of replacing any fence or wall that is
on a Residential Lot shall be the responsibility of the Residential Lot Owner, subject to such
approvals of the Architectural Committee or Board, as may be required by this Declaration.
MAGNOLIA AT LA COSTA
DECLARATION 50 CCRS-BY-AOI-DS-DOC
14.1.4. LANDSCAPING; SLOPES.
All landscaping and slopes on his or her Residential Lot (except
for those areas located within the Association Area), including without limitation, the regular
irrigation, fertilization and cleaning thereof to prevent rubbish or debris of any kind from being
either placed or permitted to remain or accumulate upon or adjacent to such Lot, so as to render
such Lot or portion thereof unsanitary, unsightly, offensive or detrimental to other residents. In
order to assure proper fire safety conditions within unimproved areas of a Residential Lot, each
Owner shall maintain brush clearance on his or her Lot according specifications as may be
required by the City, or in the absence thereof, in conformance with fire prevention standards
that may be recommended by local fire fighting agencies.
14.2. OWNER'S FAILURE TO MAINTAIN; WILLFUL OR NEGLIGENT ACT,
In the event an Owner fails to maintain the areas described herein pursuant to
the standards set by the Board, or if an Owner, or his or her Invitees or pets, cause the willful or
negligent act or neglect of the same or any other area within the Project, the Board may give
written notice to the Owner of the work required and request that the same be done within a
reasonable time under the specific circumstances, provided, however, that Board shall have the
right to approve the person or company who shall perform the maintenance or repairs and the
method of repair. In the event the Owner fails to carry out such work of maintenance or repair
within said time period, the Board may, following a Notice and Hearing as provided in the Article
herein entitled RIGHTS OF OWNERS, BOARD AND ASSOCIATION, cause such work to be
completed and shall assess the cost thereof to such Owner as an Enforcement Assessment in
accordance with the procedures set forth in this Declaration.
14.3. RESPONSIBILITY OF ASSOCIATION.
The Association shall be responsible for maintaining, repairing, replacing and
otherwise caring for the Association Area in a good condition of maintenance and repair, and
in accordance with any requirements of the City. The foregoing Association responsibilities are
not intended to be applicable when due to any negligent act of an Owner or his or her Invitee(s).
14.4. ASSUMPTION OF MAINTENANCE OBLIGATIONS.
Declarant and its subcontractors, and the agents and employees of the same,
shall have the right to come upon the Association -Areas to complete the construction,
refurbishment or installation of any landscaping or other improvements to be installed
thereupon. In the event that Declarant or any of Declarant's subcontractors are contractually
obligated to maintain the landscaping and/or other improvements on any portion of the
Association Areas, such maintenance shall not be assumed by the Association until the
termination of such contractual obligation. If there is any excess of assessments collected over
actual Common Expenses incurred by the Association, caused by reason of this Section, or
otherwise, such excess shall be placed in reserve to offset the future expenses of the
Association in any manner designated by the Board.
14.5. PROPERTY MANAGEMENT.
The Board may, at its option, employ a professional management company
("Managing Agent") to handle the day to day management and operation of the Project; upon
MAGNOLIA AT LA COSTA
DECLARATION 51 CCRS-BY-AOI-DS.DOC
such election, the Board shall from prospective Managing Agents written statements to the
Board which shall contain the information concerning the managing agent required to comply
with California Civil Code Section 1363,1, or any succeeding statute.
15. INSURANCE
15.1. MASTER INSURANCE POLICY.
The Association shall obtain and continue in effect the following insurance:
15.1.1. LIABILITY INSURANCE.
A general, comprehensive liability insuring the Association, the
Board, the Architectural Committee, any manager, the Declarant and the Owners and
occupants of the Residential Lots and their respective Invitees against any liability incident to
ownership or use of the Association Area or any other Association owned or maintained real or
personal property, and the performance by the Association of its duties under this Declaration,
arising out of any single occurrence; the amount of general liability insurance which the
Association shall carry at all times shall be not less than Two Million Dollars ($2,000,000), or
such amount as the Board may otherwise deem appropriate to protect the interests of the
Members. Liability insurance coverage shall include coverage against water damage liability,
property of others and any other liability or risk as are customarily covered with respect to
similar real estate developments in the area of the Project. The general liability policy shall also
include such provisions as may be required by the provisions of California Civil Code Section
1365.7, or any successor statute, to limit the monetary liability of volunteer directors and officers
of the Association.
15.1.2. CASUALTY INSURANCE.
A casualty policy insuring all Association Area improvements and
fixtures and such other improvements that may be owned by the Association to the extent
necessary to fully protect the interests of the Owners, or as may be required by Institutional
Mortgagees. In the event of any loss, damage or destruction to the Association Area (that is,
excluding Residential Lots), the Association shall cause the same to be replaced, repaired or
rebuilt in accordance with the provisions of this Declaration.
15.1.3. COVERED CAUSE OF LOSS.
The policy shall provide coverage against losses caused by fire
and all other hazards normally covered by a "special form" policy or its equivalent.
15.1.4. PRIMARY.
The policy shall be primary and noncontributing with any other
insurance policy covering the same loss.
MAGNOLIA AT LA COSTA
DECLARATION 52 CCRS-BY-AOI-DS.DOC
15.1.5.
15.1.6. ENDORSEMENTS.
The policy shall contain such endorsements as the Board in its
discretion shall elect.
15.1.7. WAIVER OF SUBROGATION.
Except as provided in Section 11.25 entitled "Indemnification,"
the Association waives all rights of subrogation against the Owners and their Invitees. All
insurance policies obtained by the Association shall include a waiver of all subrogation rights
against any Owner and their Invitees; provided, however, that a failure or inability of the
Association to obtain such waiver shall not defeat or impair the waiver of subrogation rights
between the Association and the Owners and their Invitees set forth herein. Insurance
proceeds for Improvements in the Association Area and personalty owned by the Association
shall be payable to the Association.
15.1.8. DISHONEST ACTS; FIDELITY BOND.
Such insurance covering directors, officers and employees of the
Association and employees of any manager or managing agent, or administrator, whether or not
any such persons are compensated for their services, against dishonest acts on their part, or in
lieu thereof, a fidelity bond, naming the Association as obligee, written in an amount equal to at
least the estimated maximum of funds, including reserves in the custody of the Association or
the management agent at any given time during the term of the fidelity bond. However, the
bond shall not be less than a sum equal to three (3) months aggregate Regular Assessments on
all Residential Lots , including reserve funds.
15.1.9. WORKERS COMPENSATION INSURANCE.
Worker's compensation insurance covering any employees of the
Association to the extent required by law.
15.1.10. OTHER INSURANCE.
Such other insurance as the Board in its discretion considers
necessary or advisable to fully protect the interests of the Owners.
15.2. FNMA; FHLMC; INSTITUTIONAL MORTGAGEE.
The amount, term and coverage of any policy required hereunder shall satisfy the
minimum requirements imposed for this type of project by the FNMA and the FHLMC or any
successor thereto and any Institutional Mortgagee. If the FNMA, FHLMC or Institutional
Mortgagee requirements conflict, the more stringent requirement shall be met. If FNMA,
FHLMC and any Institutional Mortgagee (on a Residential Lot) do not impose requirements on
any policy required hereunder, the term, amount and coverage of such policy shall be no less
than that which is reasonable for the nature of the Project and its insurable assets.
MAGNOLIA AT LA COSTA
DECLARATION 53 CCRS-BY-AOI-DS.DOC
15.3. TEN (10) DAY CANCELLATION NOTICE.
All insurance policies shall provide that they shall not be cancelable by the
insurer without first giving at least ten (10) days' prior notice in writing to the Association.
15.4. TRUSTEE; ADJUSTMENT OF LOSSES.
Each Owner, by acceptance of a deed or other conveyance to his or her
Residential Lot, hereby agrees:
15.4.1. TRUSTEE.
That ail insurance proceeds payable under Sections 15.1.1, and
15.1.2 above, may be paid to a trustee (the "Trustee"), to be held and expended for the benefit
of the Association, the Owners. Mortgagees and others, as their respective interests shall
appear. The Trustee shall be a commercial bank or other institution with trust powers in the
County that agrees in writing to accept such trust.
15.4.2. ADJUSTMENT OF LOSSES.
That the Board may act as attomey-in-fact on behalf of each
Owner to negotiate and agree on the value and extent of any loss under any policy carried
pursuant Section 15.1 above, and shall have full right and authority to compromise and settle
any claims or enforce any claim by legal action or otherwise and to execute releases in favor of
any insured.
15.5. DUTY TO CONTRACT.
If repair or reconstruction is authorized as a result of damage or destruction, the
Board and any the duly appointed Trustee shall have the duty to contract for such work as
provided for in pursuant to Section 16.4hereinafter.
15.6. OWNERS' INSURANCE.
Each Owner may obtain and maintain, at no expense to the Association or other
Owners, such fire, casualty and liability coverage as may be desired or as may be required by
any Mortgagee of the Owner's Residential Lot.
15.7. FAILURE TO ACQUIRE.
The Association, and its directors and officers, shall have no liability to any
Owner or Mortgagee if, after a good faith effort, it is unable to obtain the liability insurance
required hereunder, because the insurance is no longer available or, if available, can be
obtained only at a cost that the Board in its sole discretion determines is unreasonable under
the circumstances, or the Members fail to approve any assessment increase needed to fund the
insurance premiums. In such event, the Board immediately shall notify each Member and any
First Mortgagee entitled to notice that the liability insurance will not be obtained or renewed.
MAGNOLIA AT LA COSTA
DECLARATION 54 ccRs-BY-Aoi.oa.ooc
15.8. PERIODIC REVIEW OF POLICIES.
The Board shall review the adequacy of all insurance as least once every year.
The review shall include a replacement cost appraisal of all insurable Association Area and
Association owned Improvements without respect to depreciation. The Board shall adjust and
modify the policies to provide coverage and protection that is customarily carried by and
reasonably available to prudent owners of similar property in the area in which the Project is
situated.
15.9. DISTRIBUTION TO MORTGAGEES.
Any Mortgagee has the option to apply insurance proceeds payable directly to an
Owner on account of a Residential Lot as provided in this Declaration in reduction of the
obligation secured by the Mortgage of such Mortgagee.
15.10. INSPECTION OF POLICIES.
Copies of all Association insurance polices (or certificates thereof showing the
premiums thereon to have been paid) shall be retained by the Association and be open for
inspection by Owners at any reasonable times.
15.11. INSURANCE INFORMATION TO MEMBERS.
The Board shall annually prepare and distribute or caused to be prepared and
distributed within sixty (60) days preceding the beginning of the Association's fiscal year, a
summary of the Association's insurance polices pursuant to the requirements of Civil Code
Section I365(e), as it may be amended from time to time, or, the extent that any of the
information required to be disclosed pursuant to said Civil Code Section is specified in the
insurance policy declaration page, the Board may meet the requirements thereof by making
copies of that page(s) and distributing it to all Members.. Any Association Member may, upon
request and provision of reasonable notice, review the Association's actual insurance policies
and, upon request and payment of reasonable duplication charges, obtain copies of those
policies.
16. DAMAGE OR DESTRUCTION
16.1. RESTORATION DEFINED.
As defined in this Article, the term "restore" shall mean repairing, rebuilding or
reconstructing damaged Improvements located within the Property for which the Association is
responsible pursuant to this Declaration to substantially the same condition and appearance in
which it existed prior to fire or other casualty damage.
16.2. INSURED CASUALTY.
If any improvement is damaged or destroyed from a risk covered by the
insurance required to be maintained by the Association, then the Association shall, to the extent
permitted under existing laws, restore the Improvement to the same condition as it was in
immediately prior to the destruction. If such damage or destruction occurs prior to the date of
MAGNOLIA AT LA COSTA
DECLARATION 55 CCRS-BY-AOI-DS-DOC
completion of construction the Project by Declarant, then, such construction shall be completed
in coordination with any construction required or deemed necessary to be completed by
Declarant. If fire or other casualty damage extends to any Improvement which is so insured, the
Association shall proceed with the filing and adjustment of all claims arising under the existing
insurance policies. The insurance proceeds shall be paid to and held by the Association or its
Trustee,
16.3. RESTORATION PROCEEDS.
The costs of restoration of damaged Improvement shall be funded first by any
insurance proceeds paid to the Association under existing insurance policies. If the insurance
proceeds exceed the costs of restoration, the excess proceeds shall be paid to the reserve
accounts of the Association and held for the benefit of the Association. If the insurance
proceeds are insufficient to restore the damaged Improvement, the Board shall then add to the
insurance proceeds all reserve account funds designated for the repair or replacement of the
Improvement(s) which have been damaged. If the total funds then available are sufficient to
restore the damaged Improvement, the damaged Improvement shall be restored. If the
aggregate amount of insurance proceeds and such reserve account funds are still insufficient to
pay the total costs of restoration, a Special Assessment against all Owners shall be levied by
the Board (but without the consent or approval of Members, despite any contrary provisions in
this Declaration or other Project Documents) for the cost of repairing and reconstructing
Improvements to the extent insurance proceeds are unavailable.
16.4. REBUILDING CONTRACT.
The Board or its authorized representative shall obtain bids from at least two (2)
licensed and reputable contractors and shall accept the repair and reconstruction work from
whomever the Board determines to be in the best interests of the Members. The Board shall
have the authority to enter into a written contract with the contractor for such repair and
reconstruction, and the insurance proceeds held by the Trustee shall be disbursed to the
contractor according to the terms of the contract. It shall be the obligation and duty of the Board
to take all steps necessary to contract for, assure the commencement and completion of
authorized repair and reconstruction at the earliest possible date. Such construction shall return
the Project to substantially the same condition it was in prior to such damage or destruction and
shall be carried out pursuant to all applicable laws and ordinances.
16.5. MINOR REPAIR AND RECONSTRUCTION.
The Board shall have the duty to repair and reconstruct Improvements, without
the consent of the Members and irrespective of the amount of available insurance proceeds, in
all cases of partial destruction when the estimated cost of repair and reconstruction does not
exceed One-Hundred-Thousand Dollars ($100,000.00), which amount shall be increased
three percent (3%) per annum on a compounded basis commencing on the anniversary date of
the recordation of this Declaration and each anniversary date thereafter. The Board is
expressly empowered to levy a Special Assessment for the cost of repairing and
reconstructing such improvements to the extent insurance proceeds are unavailable (but without
the consent or approval of Members, despite any contrary provisions in this Declaration or other
Project Documents).
MAGNOLIA AT LA COSTA
DECLARATION 56 ccRs-BY-Aoi-D3.DOC
16.6. BOARD'S ACTION.
The Board shall have the exclusive right to participate in and represent the
interests of all Owners in any proceedings affecting the Project relating to the rebuilding or any
portion of the Project, including, without limitation, proceedings with any governmental or quasi-
governmental agency to obtain permits or approvals for any rebuilding, and no Owner shall
have the right to directly participate therein, except that, prior to the conversion of the Class B
membership in the Association to Class A membership, Declarant shall have the right to directly
participate therein.
16.7. DAMAGE TO DWELLINGS.
Restoration and repair of any damage to the Dwelling on a Residential Lot, or
other Improvements thereon, shall be made by and at the individual expense of the Owner of
such Residential Lot. In the event of a determination by an Owner not be rebuilt the Dwelling,
the Residential Lot shall be landscaped and maintained in an attractive and well-kept condition
by the Owner thereof. All such repair and restoration shall be completed as promptly as
practical and in a lawful and workmanlike manner, in accordance with plans approve by the
Board as provided herein.
17. CONDEMNATION; EMINENT DOMAIN.
17.1. CONDEMNATION OF ASSOCIATION AREA PORTIONS OF
RESIDENTIAL LOTS.
If at any time all of any portion of the Association Area portion of a Residential
Lot or any interest therein, is taken for any public or quasi-public use, under any statute, by right
of eminent domain or by private purchase in lieu of eminent domain, the entire award in
condemnation, shall be paid to the Association and shall be used for restoring the balance of
the Project. To the extent the Association is not permitted by the governmental agency to
rebuild, then such award shall be apportioned among the Owners by court judgment or by
agreement between the condemning authority and each of the affected Owners in the Project,
the Association and their respective Mortgagee to such area as their interests may appear
according to the fair market values of each Residential Lot at the time of destruction, as
determined by independent appraisal. Said appraisal shall be made by a qualified real estate
appraiser with an MAI certificate or the equivalent, which appraiser shall be selected by the
Board. Any such award to the Association shall be deposited into the maintenance and
operation account of the Association. The Association shall represent the interests of all
Owners of any proceeding relating to such condemnation.
17.2. CONDEMNATION OF A RESIDENTIAL LOT.
In the event of any taking of a Residential Lot, other than that portion which may
lie within the boundaries of the Association Area, the Owner (and such Owner's Mortgagees as
their interests may appear) of the Residential Lot shall be entitled to receive the award for such
taking and, after acceptance thereof, such Owner and such Owner's Mortgagee(s) shall be
divested of all further interest in the Residential Lot and membership in the Association, if such
Owner shall vacate such Owner's Residential Lot as a result of such taking. In such event said
MAGNOLIA AT LA COSTA
DECLARATION 57 CCRS-BY-AOI-DS.DOC
Owner shall grant his or her remaining interest as a Member in the Association appurtenant to
the Residential Lot so taken to the other Members.
18. RIGHTS OF MORTGAGEES
18.1. CONFLICT.
Notwithstanding any contrary provision contained elsewhere in the Project
Documents, the provisions of this Article shall control with respect to the rights and obligations
of Mortgagees as specified herein.
18.2. MORTGAGEE PROTECTION.
A breach of any of the conditions contained in this Declaration shall not defeat
nor render invalid the lien of any First Mortgage made in good faith and for value as to any
Residential Lot in the Project; provided, however, that the conditions contained in this
Declaration shall be binding upon and effect against any Owner of a Residential Lot if the
Residential Lot is acquired by foreclosure, trustee's sale or otherwise.
18.3. LIABILITY FOR UNPAID ASSESSMENTS AND COMMON EXPENSES.
Any First Mortgagee who obtains title to a Residential Lot pursuant to the
remedies provided in the First Mortgage (except upon a voluntary conveyance to the First
Mortgagee) or as a result of judicial or power-of-sale foreclosure of the First Mortgage, shall
take title property free of any claims for unpaid assessments or charges for Common Expenses
against the Residential that became due prior to the acquisition of title to such Residential Lot
by the First Mortgagee.. Such unpaid assessment or charges for Common Expenses, however,
shall be deemed to be a Common Expenses collectible from all of the Residential Lots including
such First Mortgagee, its successors and assigns, and subject to the provisions for the
collection of assessments contained in this Declaration, as may be amended by statute.
18.4. PAYMENT OF TAXES AND INSURANCE.
First Mortgagees may, jointly, singlely or severally: (a) pay taxes or other charges
which are in default and which may or have become a charge against any Residential Lot or the
Association Area or Improvements situated thereon, unless the taxes or charges are separately
assessed against the Owners, in which case, the rights of First Mortgagees shall be governed
by the provisions of their Mortgages; (b) pay overdue premiums on hazard insurance policies, or
secure new hazard insurance coverage on the lapse of a policy for the Association Area. -First
Mortgagees making such payments shall be owed immediate reimbursement from-the Owner of
the Residential Lot for payments that are solely attributable to charges against such Owner's
Residential Lot, or from the Association as to payments that are solely attributable to the
Association Area or other Improvements owned by the Association. This provision shall
constitute an agreement by the Association for the express benefit of all First Mortgagees, and
upon the request of any First Mortgagee, the Association shall execute and deliver to such First
Mortgagee a separate written agreement embodying this provision.
MAGNOLIA AT LA COSTA
DECLARATION 58 ccRs-BY.Aoi-D3.ooc
18.5. AGREEMENT FOR MANAGEMENT.
Any management agreement of the Project, or any portion thereof, and any other
contract providing for services by the Declarant, shall be terminable for cause upon thirty (30)
days written notice, and without cause or payment of a termination fee upon ninety (90) days,
written notice and shall have a term of not more than one (1) year, renewable with the consent
of the Association and the management agent. The Board shall not terminate professional
management of Project and assume self-management, when professional management had
been required previously by an Eligible Mortgage Holder, without the prior written approval of
Mortgagees holding seventy-five percent (75%) or more of the First Mortgages on Dwellings.
18.6. NOTIFICATION TO ELIGIBLE MORTGAGEE HOLDER.
Upon written request to the Association, identifying the name and address of the
holder, insurer or guarantor and the Residential Lot number or address, any Eligible Mortgage
Holder or Eligible Insurer will be entitled to timely written notice of:
(a) Any condemnation loss or any casualty loss which affects a material
portion of the Project or the Residential Lot insured or guaranteed by such Eligible Mortgage
Holder or Eligible Insurer;
(b) Any default in the performance by an Owner of any obligation under the
Project Documents not cured within sixty (60) days;
(c) Any lapse, cancellation or material modification of any insurance policy or
fidelity bond maintained by the Association; and
(d) Any proposed action which would require the consent of a specified
percentage of Eligible Mortgage Holders as required by the Project Documents.
18.7. NO RIGHT OF FIRST REFUSAL.
This Declaration neither contains nor shall be amended to contain any provision
creating a "right of first refusal" to the Association before a Residential Lot can be sold. Should
any such rights nevertheless be created in the future, such rights shall not impair the rights of
any First Mortgagee to: (a) foreclose or take title to a Residential Lot pursuant to the remedies
provided in the First Mortgage, (b) accept a deed (or assignment) in lieu of foreclosure in the
event of a default by a Mortgagor, or (c) sell or lease a Residential Lot acquired by the
Mortgagee.
18.8. ACTION REQUIRING MORTGAGEE APPROVAL.
Unless at least sixty-seven percent (67%) of the Eligible Mortgage Holders
(based upon one (1) vote for each Mortgage owned), or sixty-seven percent (67%) of the
Owners (other than Declarant) have given their prior written approval, the Association and/or the
Owners shall not be entitled to:
(a) By act or omission seek to abandon encumber or transfer the Association
Area, or any property owned, directly or indirectly, by the Association for the benefit of the
Residential Lots and the Owners (the granting of rights of way for public utilities or other public
MAGNOLIA AT LA COSTA
DECLARATION 59 CCRS-BY-AOMM.DOC
purposes consistent with the intended use of the Association Area by the Association and
Owners shall not be deemed a transfer in the meaning of this clause);
(b) By act or omission change the method of determining the obligations,
assessments, dues or other charges which may be levied against an Owner;
(c) By act or omission, change, waive or abandon any scheme of regulations,
or enforcement thereof, pertaining to the architectural design or the exterior appearance or
exterior maintenance of Residential Lots, the maintenance of the Association Area; or
(d) Fail to maintain fire and extended coverage on insurable Association Area
on a current replacement cost basis in an amount not less than one hundred percent (100%) of
the insurable value (based on current replacement costs); or
(e) Use hazard insurance proceeds for losses to any property or
Improvements owned by the Association other than for the repair, replacement or reconstruction
of such Common property and Improvements.
18.9. PRIORITY OF PROCEED OR AWARD DISTRIBUTION.
Any other provision herein contained to the contrary notwithstanding, no
provision of this Declaration or any other Project Document shall give a Residential Lot Owner,
or any other party, priority over any rights of the First Mortgagee of a Residential Lot pursuant to
its mortgage in the case of a distribution to such Lot Owner of insurance proceeds or
condemnation awards for losses to or a taking of the Association Area.
18.10. INSPECTION OF PROJECT DOCUMENTS, BOOKS AND RECORDS.
The Association shall make available to Eligible Mortgage Holders, current
copies of the Project Documents and the books, records and financial statements of the
Association. "Available" means available for inspection, upon request, during normal business
hours or under other reasonable circumstances.
18.11. SELF-MANAGEMENT.
The vote or written consent of sixty-seven percent (67%) of the total voting power
of the Association and fifty-one percent (51%) of the Eligible Mortgage Holders shall be required
to assume self-management of the Project if professional management of the Project has been
required by an Eligible Mortgage Holder at any time. Notwithstanding the foregoing, the
Association shall not be permitted to elect to self-manage the Project for a period of three (3)
years after the first conveyance of a Residential Lot to a Retail Buyer under the authority of a
Public Report.
18.12. VOTING RIGHTS ON DEFAULT.
In case of default by any Owner in any payment under the terms of any First
Mortgage encumbering such Owner's Residential Lot, or the promissory noted secured by the
Mortgage, the Mortgagee or its representative, on giving written notice to such defaulting Owner
or Owners, and placing of record a "Notice of Default," is hereby granted a proxy and can
exercise the voting rights of such defaulting Owner attributable to such Residential Lot at any
regular or special meetings of the Members held during such time as such default may continue.
MAGNOLIA AT LA COSTA
DECLARATION 60 CCRS-BY-AOI.DXDOC
18.13. NON-CURABLE BREACH.
Any Mortgagee who acquires title to a Residential Lot by foreclosure or by deed-
in-lieu of foreclosure or assignment-in-!ieu of foreclosure shall not be obligated to cure any
breach of this Declaration that is non-curable or of a type that is not practical or feasible to cure.
A "breach", as used herein, shall not apply to any lien of or obligation for assessments owed to
the Association which became due prior to the acquisition of title by deed or assignment in lieu
of foreclosure.
18.14. LOAN TO FACILITATE.
Any First Mortgage given to secure a loan to facilitate the resale of a Residential
Lot after acquisition by foreclosure or by a deed-in-lieu of foreclosure or by an assignrnent-in-
lieu of foreclosure shall be deemed to be a loan made in good faith and for value and entitled to
all of the rights and protections of this Article.
18.15. DOCUMENTS TO BE MADE AVAILABLE.
(a) The Association shall make available to First Mortgagees and to holders,
insurers or guarantors of any First Mortgage, current copies of the Project Documents, and the
books, records and financial statements of the Association. "Available" means available for
inspection, upon request, during normal business hours or under other reasonable
circumstances. Eligible Mortgage Holders who represent at least fifty-one percent (51%) or
more of the Residential Lots subject to a Mortgage shall be entitled to have an audited
statement for the immediately preceding fiscal year prepared at their own expense, if one is not
otherwise available. Any financial statement so requested shall be furnished within a
reasonable time following the request.
In the event that fifty (50) or more Lots have been made subject to this
Declaration, then the Association shall make available to the holder, insurer or guarantor of any
First Mortgage, an audited financial statement on submission of a written request for the same.
The audited financial statement must be made available within one hundred twenty (120) days
of the Association's fiscal yearend.
(b) In the event fewer than fifty (50) Lots have been made subject to this
Declaration, then a First Mortgagee shall be entitled to have an audited financial statement,
provided the same is prepared at the Mortgagee's sole expense.
18.16. MORTGAGEES FURNISHING INFORMATION.
Any Mortgagee can furnish information to the Board concerning the status of any
Mortgage.
18.17. FINANCIAL STATEMENT.
Any First Mortgagee shall be entitled, on written request therefor, to have an
audited financial statement for the immediately preceding fiscal year prepared at its own
expense if one is not otherwise available. Such statement shall be furnished within a
reasonable time following such request.
MAGNOLIA AT LA COSTA
DECLARATION 61
18.18. TERMINATION WITHOUT SUBSTANTIAL DESTRUCTION.
Neither the Association nor Owners may elect to terminate the legal status of the
Project for reasons other than substantial destruction or condemnation of the Project without the
written consent of Eligible Mortgage Holders who represent at least sixty-seven percent (67%)
of the votes of the mortgaged Residential Lots.
19. AMENDMENTS
19.1. AMENDMENT PRIOR TO FIRST CONVEYANCE.
Prior to the first conveyance of a Residential Lot to a Person other than
Declarant, this Declaration and any amendments to it may be amended in any respect or
revoked by the execution by Declarant and any Mortgagee of record, of an instrument amending
or revoking this Declaration. The amending or revoking instrument shall make appropriate
reference to this Declaration and its amendments, be acknowledged, and recorded in the Office
of the County Recorder.
19.2. AMENDMENTS AFTER FIRST CONVEYANCE.
Except as may be in accordance with the provisions of California Civil Code
Sections 1355 and 1368 or any amendment or successor statute thereto, during the period of
time after the conveyance of the first Residential Lot to a Person other than Declarant, and prior
to conversion of the Class B membership in the Association to Class A membership, this
Declaration may be amended at any time and from time to time by the vote or written assent of
sixty-seven percent (67%) of the total voting power of each class of Members of the
Association. After conversion of the Class B membership in the Association to Class A
membership, this Declaration may be amended at any time and from time to time by the vote or
written assent of (i) sixty-seven percent (67%) of the total voting power of the Association, and
(ii) sixty-seven percent (67%) of the voting power of the Members of the Association other
than Declarant. However, the percentage of voting power necessary to amend a specific
clause or provision shall not be less than the prescribed percentage of affirmative votes
required for action to be taken under that clause. Any such amendment shall become
effective upon the recording with the Office of the County Recorder of either a Certificate of
Amendment or Declaration of Amendment signed and acknowledged by the President or
Vice President of the Association and the Secretary or Assistant Secretary of the Association, or
by the incorporator of the Association, in the event that no Board of Directors has yet been
elected to establish officers of the Association, certifying that such votes or written consent have
been obtained. For the purposes of recording such instrument, the President or Vice-President
and Secretary or Assistant Secretary, or incorporator of the Association are hereby granted an
irrevocable power of attorney to act for and on behalf of each and every Owner in certifying and
executing and recording said amendment with the Office of the County Recorder. No material
amendment may be made to this Declaration without the additional prior written consent of
Eligible Mortgage Holders who represent at least fifty-one percent (51%) of the votes of
Residential Lots which are subject to mortgages held by such Eligible Mortgage Holders.
"Material amendment" shall mean any amendments to provisions of this Declaration which
establish, provide for, govern or regulate any of the following:
MAGNOLIA AT LA COSTA
DECLARATION 62 CCRS-BY-AOI-DS.DOC
(a) Voting rights;
(b) Increases in assessments that raise the previously assessed amount by
more than 25%, assessment liens, or the priority of assessment liens;
(c) Reduction in reserves for maintenance, repair, and replacement of the
Association Area;
(d) Responsibility for maintenance and repairs;
(e) Reallocation of interests in the Project, or rights to their use;
(f) Redefinition of the boundaries of any Residential Lot;
(g) Convertibility of Residential Lots into Association Area or visa versa;
(h) Expansion or contraction of the Project, or the addition, annexation or
withdrawal of property to or from the Project;
(i) Insurance or fidelity bond coverage;
(j) Leasing of Dwellings;
(k) Imposition of any restrictions on an Owner's right to sell or transfer his or
her Dwelling;
(I) Any decision by the Board to establish self-management when
professional management had been required previously by the Project Documents or by an
Eligible Mortgage Holder;
(m) The restoration or repair of the Project (after hazard damage or partial
condemnation) in a manner other than that specified in the Project Documents;
(n) Any action to terminate the legal status of the Project after substantial
destruction or condemnation occurs; or
(o) Any provisions that expressly benefit Mortgage Holders, insurers or
guarantors.
An addition or amendment to this instrument shall not be considered material if it
is for the purpose of correcting technical errors, or for clarification only, or if it is made pursuant
to an amendment of or new statutory law.
With the exception of the VA and FHA, any Eligible Mortgage Holder or
Eligible Insurer who receives a written request to consent to additions or amendments requiring
consent under this provision who does not deliver or post to the requesting party a negative
response within thirty (30) days after such receipt shall be deemed to have consented to such
request, provided that notice was delivered by certified or registered mail, with a "return receipt"
requested.
MAGNOLIA AT LA COSTA
DECLARATION 63 CCRS-BY-AOI-DS.DOC
19.3. AMENDMENTS FOR TECHNICAL ERRORS, CLARIFICATION AND
CHANGES IN LAW.
Each Owner by acceptance of conveyance of title to a Residential Lot and each
Mortgagee by acceptance of a Mortgage or Deed of Trust secured by a Residential Lot, hereby
agrees and consents to the amendment of this Declaration and the subordination of their
respective interests in the Property for the purpose(s) of correcting technical errors or
clarification and/or to effect compliance of one or more provisions of this Declaration with such
amendments, repeals and/or additions made to statutory law, whereby the provisions contained
in this Declaration are in conflict therewith. The foregoing notwithstanding, to the extent that the
provisions set forth in this Declaration are intended to comply with the provisions of the
Common Interest Development Act as set forth at Civil Code Section 1350 et seq. ("CID Act"),
and any other statutory law, upon any changes to the CID Act or other statutory law relating to
such provisions of this Declaration, the Board shall comply with such provisions of the CID Act
and statutory law and the Board shall have the right to amend this Declaration as a result, of the
changes to the CID Act and statutory without any vote of the Members. Any such amendment
may be executed by the President or Vice-President and Secretary or Assistant Secretary, or
the incorporator of the Association, each of whom is hereby granted an irrevocable power of
attorney to act for and on behalf of each and every Owner and Mortgagee in certifying and
executing and recording any such correctional, clarification addition or statutory law compliance
amendment instrument in the Office of the County Recorder, each of which such amendments
shall become effective upon its recordation.
19.4. APPROVAL BY FHA AND VA.
Notwithstanding anything herein to the contrary, so long as there is a Class B
membership, and provided that the Project has been approved by the FHA and/or VA, the
following shall require the prior approval of FHA and/or VA: annexation of additional properties,
de-annexation, mergers and consolidations, any special assessments and any amendment of
this Declaration. A draft of any amendment to this Declaration should be submitted to the VA
for its approval prior to its approval by the membership of the Association.
19.5. RELIANCE ON AMENDMENTS.
Any amendments made in accordance with the terms of this Declaration shall be
presumed valid by anyone relying on them in good faith.
20. ENFORCEMENT; DISPUTE RESOLUTION
Any disputes between all or any of the following: Association, Owner(s), the Declarant,
any director, officer, partner, employer, contractor, design professional, consultant,
subcontractor or agent of the Declarant (individually/collectively "Declarant Party"!"Declarant
Parties") arising under this Declaration or relating to the Property, shall be subject to the
following provisions:
20.1. CONSTRUCTION DEFECT DISPUTE RESOLUTION.
Prior to the commencement of any legal action by the Association or any Owner
against the Association, Declarant or any Declarant Party based upon a claim for defects in the
MAGNOLIA AT LA COSTA
DECLARATION 64 CCRS-BY-AOI-DS.DOC
design or construction of any portion of the Property or Improvements thereon, the Association
or Owner must first comply with the following requirements:
20.1.1. DECLARANT NOTICE.
The Association and/or an Owner, as the case may be (the
"Claimant"), shall notify the Declarant Party(ies) in writing of the claim, which writing shall
describe the nature of the claim and the proposed remedy (the "Claim Notice").
20.1.2. RIGHT TO INSPECT AND RIGHT TO CORRECTIVE
ACTION.
Within a reasonable period after receipt or the Claim Notice, which
period shall not exceed sixty (60) days, the Declarant Party(ies) and the Claimant shall meet at
a mutually-acceptable place within the Property to discuss the Claim. At such meeting or at
such other mutually agreeable time, Declarant Party and Declarant Party's representatives shall
have full access to the Property that is subject to the Claim for the purposes of inspecting the
Property. The parties shall negotiate in good faith in an attempt to resolve the Claim. If the
Declarant Party elects to take any corrective action, Declarant Party and Declarant Party's
representatives and agents shall be provided full access to the Property to take and complete
corrective action.
If the Claim is subject to the provisions of Civil Code Section 1375, or any
successor statute, compliance with the procedures of Civil Code Section 1375(b), (c), (d) and
(e) shall satisfy the requirements of Sections 20.1.1 and 20.1.2 above (notwithstanding the fact
that such Section 1375 does not apply to Owners by its terms). Any unresolved disputes under
Sections 20.1.1 and 20.1.2, or Civil Code Section 1375, shall be submitted to mediation
pursuant to Section 20.3 below.
20.2. OTHER DISPUTE RESOLUTION.
Any other disputes arising under this Declaration or otherwise between or among
the Association, any Owner and/or any Declarant Party (except for action taken by the
Association for delinquent assessments, and any action involving any Common Area completion
bonds) shall first be submitted to mediation pursuant to Section 20.3 below.
20.3. MEDIATION.
(a) Any unresolved disputes under Sections 20.1.1 and 20.1.2 above
(including, if applicable, Civil Code Section 1375 procedures), or Section 20.2 above, the matter
shall be submitted to mediation pursuant to the mediation procedures adopted by any entity
offering mediation services that is acceptable to the Parties. No person shall serve as a
mediator in any dispute in which the person has any financial or personal interest in the result of
the mediation, except by the written consent of all Parties. Prior to accepting any appointment,
the prospective mediator shall disclose any circumstances likely to create a presumption of bias
or prevent a prompt commencement of the mediation process.
(b) Position Memoranda; Pre-Mediation Conference. Within ten (10) days
at the selection or the mediator, each party shall submit a brief memorandum setting forth its
position with regard to the issues that need to be resolved. The mediator shall have the right to
MAGNOLIA AT LA COSTA
DECLARATION 65 CCRS-BY-AOI-OIDOC
schedule a pre-mediation conference, and all Parties shall attend unless otherwise agreed. The
mediation shall be commenced within ten days following the submittal of the memoranda and
shall be concluded within fifteen (15) days from the commencement of the mediation unless the
Parties mutually agree to extend the mediation period. The mediation shall be held in San
Diego County or such other place as is mutually acceptable by the Parties.
(c) Conduct of Mediation. The mediator has discretion to conduct the
mediation In the manner in which the mediator believes is most appropriate for reaching a
settlement of the dispute. The mediator is authorized to conduct joint and separate meetings
with the Parties and to make oral and written recommendations for settlement, whenever
necessary, the mediator may also obtain expert advice concerning technical aspects of the
dispute, provided the Parties agree and assume the expenses of obtaining such advice. The
mediator does not have the authority to impose a settlement on the Parties.
(d) Parties Permitted at Sessions. Persons other than the Parties, the
representatives and the mediator may attend mediation sessions only with the permission of the
Parties and the consent of the mediator. Confidential information disclosed to a mediator by the
Parties or by witnesses in the course of the mediation shall not be divulged by the mediator. All
records, reports or other documents received by the mediator while serving In such capacity
shall be confidential. There shall be no stenographic record of the mediation process.
(e) Expenses. The expenses of witnesses for either side shall be paid by
the party producing such witnesses. All other expenses of the mediation, including required
traveling and other expenses of the mediator, and the expenses of any witnesses or the cost of
any proofs or expert advice produced at the direct request of the mediator, shall be borne
equally by the Parties unless they agree otherwise. Each patty to the Dispute participating in
the mediation shall bear its own attorney' fees.
20.4. JUDICIAL REFERENCE.
Any unresolved disputes under Section 20.3 above, shall be submitted to
general judicial reference pursuant to California Code of Civil Procedure Sections 638(1)
and 641-645.1 or any successor statutes thereto. The Parties shall cooperate in good faith to
ensure that all necessary and appropriate Parties are included in the judicial reference
proceeding. The Parties shall share equally in the fees and costs of the referee, unless the
referee orders otherwise. The general referee shall have the authority to try all issues, whether
of fact or law, and to report a statement of decision to the court. The Parties shall use the
procedures adopted by either (i) Judicial Arbitration and Mediation Services ("JAMS"} for
judicial reference and selection of a referee, or (ii) any other entity offering judicial reference
dispute resolution procedures as may be mutually acceptable to the Parties), provided that the
following rules and procedures shall apply in all cases unless the Parties agree otherwise:
(a) Place. The proceedings shall be heard in the county in
which the Project is located;
(b) Referee. The referee shall be an attorney or retired judge
with substantial experience in relevant real estate matters;
MAGNOLIA AT LA COSTA
DECLARATION 66 ccRs-BY.Aoi-o3.ooc
(c) Dispute re: Referee. Any dispute regarding the selection
of the referee shall be resolved by the entity providing the reference services or, if no entity is
involved, by the court with appropriate jurisdiction;
(d) Pre-Hearing Conferences. The referee may require one
or more pre-hearing conferences;
(e) Discovery. The Parties shall be entitled to discovery, and
the referee shall oversee discovery and may enforce all discovery orders in the same manner
as any trial court judge;
(f) Motions. The referee shall have the power to hear and
dispose of motions in the same manner as a trial court judge;
(g) Rules of Law. The referee shall apply the rules of law,
including the rules of evidence, unless expressly waived by both Parties;
(h) Waiver of Jury Trial. The Parties shall waive jury trial of
the proceedings;
(i) Record. A stenographic record of the hearing shall be
made, provided, that the record shall remain confidential except as may be necessary for post-
hearing motions and any appeals;
(j) Statement of Decision. The referee's statement of
decision shall contain findings of fact and conclusions of law to the extent applicable; and
(k) Post-hearing Motions. The referee shall have the
authority to rule on all post-hearing motions in the same manner as a trial judge.
The statement of decision of the referee upon all of the issues considered by the
referee is binding upon the Parties, and upon filing of the statement of decision with the clerk of
the court, or with the judge where there is no clerk, judgment may be entered thereon. The
decision of the referee shall be appealable as if rendered by the court. This provision shall in no
way be construed to limit any valid cause of action which may be brought by any of the Parties.
The Parties acknowledge and accept that they are waiving their right to a jury trial.
20.5. CIVIL CODE SECTION 1354.
The dispute resolution procedures in Sections 20.3 and 20.4, as they may apply
solely to a dispute under Section 20.2 above entitled "OTHER DISPUTE RESOLUTION.." shall
be deemed to satisfy the alternative dispute requirements of Civil Code Section 1354, as
applicable.
20.6. FAILURE TO ENFORCE.
Failure by the Association, any Owner, including Declarant, to enforce any
provisions of this Declaration shall in no event be deemed a waiver of the right to do so
thereafter.
MAGNOLIA AT LA COSTA
DECLARATION 67 CCRS-BY-AOI-DS-DOC
20.7. VIOLATION OF LAW.
Any violation of any state, municipal or local law, ordinance or regulation
pertaining to the ownership, occupation or use of any Residential Lot within the Project is
hereby declared to be a violation of this Declaration and subject to the enforcement procedures
herein set forth.
20.8. MEETING AND NOTICE TO MEMBERS PRIOR TO CERTAIN LEGAL
ACTIONS BY THE BOARD.
Notwithstanding anything contained in this Declaration to the contrary, the Board
shall not institute any significant legal proceeding, including any mediation, or administrative
proceeding, against any person without (i) conducting a Special Meeting of Members to discuss
the nature of the proposed proceeding, and (ii) providing the Members written notice of such
Special Meeting, which notice shall be sent not less than thirty (30) days [Civil Code Section
1368.4]and not more than ninety (90) days before such Special Meeting. The notice shall
describe the following:
(a) The purpose of the proceeding;
(b) The parties to the proceeding;
(c) The anticipated cost to the Association (including attorneys' fees) in
processing the proceeding;
(d) The source of funds to process the proceeding (reserves or special or
regular assessments);
(e) The options, including civil action, that are available to address the
purpose of the proceeding;
(f) The place, day and hour of the meeting;
(g) All such notices shall be delivered in accordance with the provisions
therefor contain in Section 21.3 entitled "Notice" in the Article hereafter entitled GENERAL
PROVISIONS.
20.8.1. DEFINITION OF "SIGNIFICANT LEGAL PROCEEDING."
For purposes herein, "significant legal proceeding" shall mean and
refer to any legal proceeding in which it reasonably could be anticipated that any of the following
events could occur:
(a) The levy of a Special Assessment to fund all or any portion
of the costs of the proceeding;
(b) The expenditure of funds from the Association's reserves
in connection with the proceeding in an amount in excess of five percent (5%) of the then
current reserves;
MAGNOLIA AT LA COSTA
DECLARATION 68 CCRS-BY-AOI-DS.DOC
(c) The expenditure of funds from the Association's Regular
Assessment operating account in connection with the proceeding in an amount in excess of five
percent (5%) of the then current fiscal year's budgeted gross expenses;
(d) The amount at issue is in excess of $25,000;
(e) The proceeding could have a material adverse effect on
the ability to sell and/or refinance the Units during the period in which the proceeding is being
prosecuted; or
(f) The matter relates to the filing of any civil action by the
Association against the Declarant or other person for alleged damage to the Common Areas,
alleged damage to the Units or portions thereof that the Association is obligated to maintain or
repair, or alleged damage to the Units or portions thereof that arises out of, or is integrally
related to, damage to the Common Areas or Units or portions thereof that the Association is
obligated to maintain or repair.
20.8.2. INAPPLICABILITY OF PROVISIONS; POWER TO TAKE
ACTION.
Notwithstanding the foregoing, the notice to Members shall not
apply:
(a) To the filing or foreclosure of a lien levied by the
Association for nonpayment of assessments and/or to the filing of an action in a court of
competent jurisdiction to enforce such lien and/or collect such assessments;
(b) To an action or proceeding to abate a nuisance and/or to
effect the repair or maintenance of any element of the Common Area, or a Unit where an
immediate threat to personal safety or of further property damage is involved;
(c) To any dispute arising with a prospective purchaser which
concerns or affects the close of escrow or matters concerning the close of escrow for the
purchase of any Unit;
(d) To enforce any completion bond as described in the
Bylaws;
(e) If the Board determines that an Association's claim or act
with regard to an Action will be barred by an applicable statute of limitation or other exigency by
reason of a delay in giving the notice, in which case the Board may take the necessary steps to
commence the proceeding to preserve the rights of the Association; provided, however, that as
soon as is reasonably practical thereafter, and not later than thirty (30) days following the
commencement of the proceeding, the Board shall provide the Owners with notice as required
herein and conduct the meeting therefor within ninety (90) days of such notice being given.
MAGNOLIA AT LA COSTA
DECLARATION 69
20.9. PREREQUISITES TO ASSOCIATION'S ACTION(S) AGAINST
DECLARANT AND OTHERS
Before the Association may commence any action for damages against the
Declarant or any one else based upon a claim for defects in the design or construction of the
Project or any portion thereof, a/I of the requirements of California Civil Code Section 1375 (b) to
(g) inclusive, as it many from time to time be amended, shall be met.
20.10. ASSOCIATION CLAIMS.
In order to assure sufficient funds to effect proper construction, reconstruction,
repair or replacement of Improvements within the Project, in any litigation, mediation,
conciliation, settlement, administrative proceeding, arbitration or any other form of dispute
resolution (hereafter collectively "Proceeding") for a dispute, controversy or claim by the
Association against any contractor, subcontractor, architect, materialman, or other person or
entity involved in the planning, development or construction of the Project or any component
part thereof, including Declarant, pertaining to the planning, development, construction or
reconstruction of the Project or any component part thereof, the proceeds of the amount actually
awarded, if any, as a result of such Proceeding must be utilized by the Association, solely and
exclusively, for (a) the construction, reconstruction, repair or replacement of those
improvements in the Project which were the subject of such Proceeding, provided, however,
such awarded proceeds may be used for alternative purposes upon the vote or written assent of
(i) seventy-five percent (75%) of the total voting power of the Association, other than the
Declarant and (ii) seventy-five percent of the Owners of those Condominiums, if any, the
improvements of which require construction, reconstruction, repair or replacement pursuant to
the dispute, controversy or claim of the Proceeding; and (b) such costs of collection and/or
attorneys' fees as are specified in the Davis-Stirling Common Interest Development Act (Civil
Code Sections 1350 through 1373, inclusive), as it existed on the date of recordation of this
Declaration.
21. GENERAL PROVISIONS
21.1. SEVERABILITY.
Should any provision in this Declaration be void or become invalid or
unenforceable in law or equity by judgment of court order, the remaining provisions hereof shall
be and remain in full force and effect.
21.2. EXTENSION OF DECLARATION.
Each and all of these covenants, conditions and restrictions shall terminate on
December 31, 2055. after which date they shall automatically be extended for successive
periods of ten (10) years, unless the Owners have executed and recorded at any time within six
(6) months prior to December 31, 2055, or within six (6) months prior to the end of any such ten
(10) year period, in the manner required for the conveyance of real property, a writing in which it
is agreed that said restrictions shall terminate on December 31, 2055, or at the end of any such
ten (10) year period.
MAGNOLIA AT LA COSTA
DECLARATION 70 CCRS-BY-AOI-DS.DOC
21.3. NOTICE.
In each instance in which notice is to be given to the Owner of a Residential Lot,
the same shall be in writing and may be hand-delivered to the Owner, in which case personal
delivery of such notice to one or two or more co-Owners of the Lot, or to any general partner of
a partnership owning such Lot, shall be deemed delivered to all of the co-Owners or to the
Partnership, as the case may be, and personal delivery of the notice to any officer or agent for
the service of process of a corporation owning such Lot shall be deemed delivered to the
corporation, or such notice may be delivered by United States Mail certified, or registered,
postage prepaid, return receipt requested, addressed to the Owner of such Lot at the most
recent address furnished by such Owner to the Secretary of the Board, or, if no such address
shall have been furnished then to the street (or Post Office Box) address of such Lot, and any
notice so deposited in the mail within San Diego County, California, shall be deemed delivered
seventy-two (72) hours after such deposit.
21.4. CIVIL CODE SECTION 1368.
The Owner of a Residential Lot shall, as soon as practicable before transfer of
title or execution of a real property sales contract therefor, as defined in California Civil Code
Section 2985, provide copies of the Project Documents and such disclosures and certificates as
may be required by Civil Code Section 1368, or any successor statute or law. The Association
shall, if requested by said Owner, provide copies of the same to such Owner within ten (10)
days of the mailing or delivery of the request.
21.5. NOTIFICATION OF SALE OR CONVEYANCE.
Concurrently with the consummation of the sale or other conveyance of any
Residential Lot where the transferee becomes an Owner of the Lot, or within five (5) business
days thereafter, the transferee shall notify the Association in writing of such sale or conveyance.
Such notification shall set forth the name of the transferee and his or her Mortgagee and
transferor, the common address of the Lot purchased by the transferee, the transferee's and the
Mortgagee's mailing address, and the date of sale or conveyance. Before the receipt of such
notification, any and all communications required or permitted to be given by the Association,
the Board, the Board's delegated committee or the Association's manager shall be deemed to
be duly made and given to the transferee if duly and timely made and given to the transferee's
transferor. Mailing addresses may be changed at any time upon written notification to the
Association. Notices shall be deemed given and given in accordance with the provisions of the
Section herein entitled "Notice".
21.6. UNANNEXED PHASES - ENCUMBRANCE OF DECLARATION.
All of the Property described in EXHIBIT "A" hereto shall be encumbered by this
Declaration upon recordation hereof in the Office of the County Recorder. Prior to the
conveyance of a Residential Lot to a Retail Buyer in an Unannexed Phase under the authority of
a ORE Public Report, such Unannexed Phase shall be subject to the following limited
Articles/Sections of this Declaration solely as they relate to or provide for the future annexation
of an Unannexed Phase or any portion thereof and/or such easements and other rights of
ingress, egress and access to and from an Unannexed Phase or for purposes of maintenance
and the protection of the value thereof: Article 1 - RECITALS, Article 3 -DEFINITIONS, Article 4
- EASEMENTS, Article 10 - ANNEXATION, Article 13- DEVELOPMENT RIGHTS, Article 19 -
MAGNOLIA AT LA COSTA
DECLARATION 71 CCRS-BY-AOI.DS.DOC
AMENDMENTS, Article 20 - ENFORCEMENT, and Article 21 - GENERAL PROVISIONS. Upon
the annexation of an Unannexed Phase, as provided in Article 10 hereinabove, conveyance of
the first Residential Lot in an Unannexed Phase to a Retail Buyer, such Phase and the
Residential Lots therein, shall become an operative part of the Project, subject to all of the
specific terms, covenants, conditions, and restrictions contained in this Declaration relating to
the operation of the Association, the Residential Lots and the Association Area.
21.7. MERGERS OR CONSOLIDATIONS.
Upon a merger or consolidation of the Association with another association, the
Association's Property, rights and obligations may, by operation of law, be transferred to the
surviving or consolidated association, or, alternatively, the properties, rights and obligations of
another association may, by operation of law, be added to the properties, rights and obligations
of the Association as a surviving corporation pursuant to a merger. The surviving or
consolidated association may administer the covenants, conditions and restrictions established
by this Declaration within the Project, together with the covenants and restrictions established
upon any other property as one plan.
21.8. EASEMENTS RESERVED AND GRANTED.
Any easements referred to in this Declaration shall be deemed reserved or
granted, or both reserved and granted, by reference to this Declaration in a deed to any
Residential Lot.
21.9. GOVERNING DOCUMENTS.
Except as may otherwise be provided in a specific Section herein, in the event of
a conflict between this Declaration and any other Project Document, the provisions of this
Declaration shall control.
21.10. SINGULAR INCLUDES PLURAL.
Whenever the context of this Declaration requires same, the singular shall
include the plural and the masculine shall include the feminine.
21.11. LIBERAL CONSTRUCTION.
The provisions of this Declaration shall be liberally construed to effectuate its
purpose of creating a uniform plan for the development of a residential community and for the
maintenance of the Project. The titles or headings of the Articles or Sections of this Declaration
have been inserted for convenience only and shall not be considered or referred to in resolving
questions or interpretation or construction.
MAGNOLIA AT LA COSTA
DECLARATION 72 CCRS-BY-AOI-DS.DOC
22. CITY OF CARLSBAD REQUIREMENTS.
22.1. GENERAL ENFORCEMENT BY CITY.
The City shall have the right, but not the obligation, to enforce those covenants,
conditions, restrictions and other provisions set forth in this Declaration in favor of, or in which
the City has an interest.
22.2. NOTICE AND AMENDMENT.
A copy of any proposed amendment shall e provided to the City in advance. If
the proposed amendment affects the City, City shall have the right to disapprove. A copy of the
final approved amendment shall be transmitted to City within 30 days for the official record.
22.3. FAILURE OF ASSOCIATION TO MAINTAIN COMMON AREA LOTS
AND EASEMENTS.
In the event that the Association fails to maintain the "Common Area Lots and/or
the Association's Easements" as provided in Section *-^> 1* . 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
Owners in the Project, setting forth with particularity the maintenance which the City finds to be
required and requesting the 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 Common Area Lots and/or Association's Easements 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.
22.4. SPECIAL ASSESSMENTS LEVIED BY THE CITY.
In the event the City has performed the necessary maintenance to either
Common Area Lots and/or Association's easements, the City shall submit a written invoice to
the Association for all costs incurred by the City to perform such maintenance of the Common
Area Lots and Association's Easements. The City shall provide a copy of such invoice to each
Owner in the Project, together with a statement that if the Association fails to pay such invoice in
full within the time specified, the City will pursue collection against the Owners in the Project
pursuant to the provisions of this Section. 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 Lot in the Project for an equal prorata share of the
invoice, plus the late charge. Such special assessment shall constitute a charge on the land
and shall be a continuing lien upon each Lot against which the special assessment is levied.
Each Owner in the Project hereby vests the City with the right and power to levy such special
assessment, to impose a lien upon their respective Lot and to bring all legal actions and/or to
pursue lien foreclosure procedures against any Owner and his/her respective Lot for purposes
MAGNOLIA AT LA COSTA
DECLARATION 73 CCRS-BY-AOI-DS.DOC
of collecting such special assessment in accordance with the procedures set forth in Section
^. 2.S of this Declaration.
MAGNOLIA AT LA COSTA
DECLARATION 74 CCRS-BY-AOI-DS.DOC
IN WITNESS WHEREOF, the undersigned, being Declarant herein, has executed this
instrument on , 1999.
DECLARANT:
KEYSTONE LA COSTA, LLC,
a California limited liability company
By: KEYSTONE COMMUNITIES, LLC,
a California limited liability company
Manager
By:
(Please Attach Proper Notary Certificate(s) of Acknowledgment)
MAGNOLIA AT LA COSTA
DECLARATION 75 ccRs-BY-Aoi-oa.DOC
23. EXHIBIT "A" - LEGAL DESCRIPTION
LOTS 1 THROUGH 31 INCLUSIVE, OF TRACT NO. IN THE
CITY OF CARLSBAD, COUNTY OF SAN DIEGO, STATE OF
CALIFORNIA, ACCORDING TO MAP THEREOF NO. ,
FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO
COUNTY, , 1999.
MAGNOLIA AT LA COSTA 76 EXHIBIT "A"
24. EXHIBIT "B" - ASSOCIATION MAINTAINED
LANDSCAPE AREAS
< TO BE INSERTED >
MAGNOLIA AT LA COSTA
DECLARATION 77 EXHIBIT "B"
C — ; -scopes'
Arc LA. CoVT/1 o
r — ^ T%X\/«TE-
ABEA
ITU t.r.
I I«ltt(FM. OttUltffl - IM S.r.1•(KOMI OMUIKI • BJ B.F.I n» i.r.
SITE DEVELOPMENT PLAN
CT 96-04 / PUD 7KB) / HDP 96-4 / SOP 96-07
DROQKriCLD MCADQW r^"Cy
afflfflcFiELD KAPOK i si re DATA
TfllH. HIE
JI.SO
Q.W
t.£4
0.56
DENSITY Vm HJO-7J
HD.itllll.t
fKij ctLcuiriaf wr NKutm cr miTt* MOWIELD.
THIS IMXUCS » LOTS tfO * StCM) CWU-1* WITS
BECTHTtM AmiTS^S
EHIEIIMI HOWtfLO ID1*L «Oul«D
liM CU.tU>TlCMB (.-,.'"! KOOVIUD >Cuae ftO-JI na-71
U(itl • BUXTUU Ui AS.SCO a.«S >1.X» O,WO
»> ZMU a er.ua ^. KM
»r D€ niNiiut m BO. /i./uiii.
UBT !JS NO WlOf OF 101 aG *«tW 135 flF BfcP M*. Mj«loww MVia CM.OJUIU *T IBJ so, n.A»ii
(30) tf MOilKD ZtD M. fl.f V*\T\
MOTE.atfl*cKS, Fmm ecr IIM.EU i
I JOE 1'ma 5
RCTitNlW MiUl. C IU«[rui Ml
A «MIU OKPOIMIOH,
SJWlYIQttWO* rfrtLO^tWT a).
EMOI«P1 OF
Slit OEIION iSStltfW. Itf.
nu u i£w «.<«., in, mi
Li Hi*, U. ii VI
ra* itiii
fu. tiiii
LH1 221. MO » PVTlm V LQt OT.
fuel «. fc-n. IB TK CIIT cr ULSWO.OUiM tf MM D1EDD. IftfE V Otifowfv
WXOBIM1 ID Ktf TX7COF Ml. ItPIl, KQNXO
in M Vfia OF r« auiir rancm CF ano
COtWtT.