Court Rules Improperly Adopted Amendment To CC&rs That Restricted Short-term Rentals Was Invalid

This case involved a challenge by a group of homeowners (“Owners”) to an amendment to their CC&Rs that was purportedly adopted by their homeowners association (“Association”). The amendment prohibited short-term property leases. Owners sued the Association for declaratory relief in the form of an order from the court that the amendment to the CC&Rs was unenforceable.

Association’s CC&Rs provided that they could be amended by approval of at least half of the lot owners in the community. The actual relevant language in the CC&Rs stated that the CC&Rs could be amended “by Instrument executed by the owners of at least fifty percent (50%) of the Lots… and such amendment shall not be effective until the recording of such Instrument.”

In response to complaints about short-term rentals, Association’s board of directors sent a letter to each lot owner in the community asking for approval of the amendment. With the letter was a consent form that the owners could sign and return to the Association to express their vote on the amendment. At Association’s subsequent annual membership meeting, the members were informed: