CALIFORNIA SUBDIVIDED LANDS ACT

BUSINESS AND PROFESSIONS CODE

SECTION 11000-11023

 

 

11000. (a) "Subdivided lands" and "subdivision" refer to improved

or unimproved land or lands, wherever situated within California,

divided or proposed to be divided for the purpose of sale or lease or

financing, whether immediate or future, into five or more lots or

parcels. However, land or lands sold by lots or parcels of not less

than 160 acres which are designated by lot or parcel description by

government surveys and appear as such on the current assessment roll

of the county in which the land or lands are situated shall not be

deemed to be "subdivided lands" or "a subdivision" within the meaning

of this section, unless the land or lands are divided or proposed to

be divided for the purpose of sale for oil and gas purposes, in

which case the land or lands shall be deemed to be "subdivided lands"

or "a subdivision" within the meaning of this section. This chapter

also does not apply to the leasing of apartments, offices, stores,

or similar space within an apartment building, industrial building,

commercial building, or mobilehome park, as defined under Section

18214 of the Health and Safety Code, except that the offering of

leases for a term in excess of five years to tenants within a

mobilehome park as a mandatory requirement and prerequisite to

tenancy within the mobilehome park shall be subject to the provisions

of this chapter. The leasing of apartments in a community apartment

project, as defined in Section 11004 in an apartment or similar

space within a commercial building or complex, shall be subject to

the provisions of this chapter.

(b) Nothing in this section shall in any way modify or affect any

of the provisions of Section 66424 of the Government Code.

(c) Subdivisions, as defined in Section 10249.1, which are located

entirely outside California shall be exempt from the provisions of

this part.

 

 

 

11000.1. (a) "Subdivided lands" and "subdivision," as defined by

Sections 11000 and 11004.5, also include improved or unimproved land

or lands, a lot or lots, or a parcel or parcels, of any size, in

which, for the purpose of sale or lease or financing, whether

immediate or future, five or more undivided interests are created or

are proposed to be created.

(b) This section does not apply to the creation or proposed

creation of undivided interests in land if any one of the following

conditions exists:

(1) The undivided interests are held or to be held by persons

related one to the other by blood or marriage.

(2) The undivided interests are to be purchased and owned solely

by persons who present evidence satisfactory to the Real Estate

Commissioner that they are knowledgeable and experienced investors

who comprehend the nature and extent of the risks involved in the

ownership of these interests. The Real Estate Commissioner shall

grant an exemption from this part if the undivided interests are to

be purchased by no more than 10 persons, each of whom furnishes a

signed statement to the commissioner that he or she (A) is fully

informed concerning the real property to be acquired and his or her

interest in that property including the risks involved in ownership

of undivided interests, (B) is purchasing the interest or interests

for his or her own account and with no present intention to resell or

otherwise dispose of the interest for value, and (C) expressly

waives protections afforded to a purchaser by this part.

(3) The undivided interests are created as the result of a

foreclosure sale.

(4) The undivided interests are created by a valid order or decree

of a court.

(5) The offering and sale of the undivided interests have been

expressly qualified by the issuance of a permit from the Commissioner

of Corporations pursuant to the Corporate Securities Law of 1968

(Division 1 (commencing with Section 25000) of Title 4 of the

Corporations Code).

 

 

 

11000.2. (a) A person who has made an offer to purchase an interest

in an undivided-interest subdivision specified in subdivision (a)

of, and not exempted by subdivision (b) of, Section 11000.1 shall

have the right to rescind any contract resulting from the acceptance

of that offer until midnight of the third calendar day following the

day on which the prospective purchaser executed the offer to

purchase.

(b) The owner of a subdivision subject to this section or his or

her agent shall, in accordance with regulations adopted by the Real

Estate Commissioner, clearly and conspicuously disclose to all

prospective purchasers of undivided interests the right of rescission

provided for in subdivision (a), and shall furnish to each offeror a

form, as prescribed by regulations of the commissioner, for the

exercise of the right of rescission.

(c) Any certificate bearing the signature of the purchaser of an

interest in an undivided-interest subdivision subject to this section

which contains an adequate description of the interest or interests

sold and a statement by the purchaser that he or she has not

exercised the right of rescission within the time limit set forth in

subdivision (a) shall constitute conclusive evidence that the right

of rescission has not been exercised in any matter involving the

rights of a third party who has acted in good faith in reliance upon

representations in the certificate.

 

 

11001. The Real Estate Commissioner (hereafter referred to in this

chapter as the commissioner) may adopt, amend, or repeal such rules

and regulations as are reasonably necessary for the enforcement of

this chapter. He may issue any order, permit, decision, demand or

requirement to effect this purpose. Such rules, regulations, and

orders shall be adopted pursuant to the provisions of the

Administrative Procedure Act.

 

 

 

11003. "Planned development" has the same meaning as specified in

subdivision (k) of Section 1351 of the Civil Code.

 

 

 

11003.2. "Stock cooperative" has the same meaning as specified in

subdivision (m) of Section 1351 of the Civil Code, except that, as

used in this chapter, a "stock cooperative" does not include a

limited-equity housing cooperative.

 

 

11003.4. (a) A "limited-equity housing cooperative" is a

corporation which meets the criteria of Section 11003.2 and which

also meets the criteria of Section 33007.5 of the Health and Safety

Code. Except as provided in subdivision (b), a limited-equity

housing cooperative shall be subject to all the requirements of this

chapter pertaining to stock cooperatives.

(b) A limited-equity housing cooperative shall be exempt from the

requirements of this chapter if the limited-equity housing

cooperative complies with all the following conditions:

(1) The United States Department of Housing and Urban Development,

the Farmers Home Administration, the National Consumers Cooperative

Bank, the California Housing Finance Agency, or the Department of

Housing and Community Development, alone or in any combination with

each other, or with the city, county, or redevelopment agency in

which the cooperative is located, directly finances or subsidizes at

least 50 percent of the total construction or development cost or one

hundred thousand dollars ($100,000), whichever is less; or the real

property to be occupied by the cooperative was sold by the Department

of Transportation for the development of the cooperative and has a

regulatory agreement approved by the Department of Housing and

Community Development for the term of the permanent financing,

notwithstanding the source of the permanent subsidy or financing.

(2) No more than 20 percent of the total development cost of a

limited-equity mobilehome park, and no more than 10 percent of the

total development cost of other limited-equity housing cooperatives,

is provided by purchasers of membership shares.

(3) A regulatory agreement which covers the cooperative for a term

of at least as long as the duration of the permanent financing or

subsidy, notwithstanding the source of the permanent subsidy or

financing has been duly executed between the recipient of the

financing and either (A) one of the federal or state agencies

specified in paragraph (1) or (B) a local public agency which is

providing financing for the project under a regulatory agreement

meeting standards of the Department of Housing and Community

Development. The regulatory agreement shall make provision for at

least all of the following:

(A) Assurances for completion of the common areas and facilities

to be owned or leased by the limited-equity housing cooperative,

unless a construction agreement between the same parties contains

written assurances for completion.

(B) Governing instruments for the organization and operation of

the housing cooperative by the members.

(C) The ongoing fiscal management of the project by the

cooperative, including an adequate budget, reserves, and provisions

for maintenance and management.

(D) Distribution of a membership information report to any

prospective purchaser of a membership share, prior to purchase of

that share. The membership information report shall contain full

disclosure of the financial obligations and responsibilities of

cooperative membership, the resale of shares, the financing of the

cooperative including any arrangements made with any partners,

membership share accounts, occupancy restrictions, management

arrangements, and any other information pertinent to the benefits,

risks, and obligations of cooperative ownership.

(4) The federal, state, or local public agency which executes the

regulatory agreement shall satisfy itself that the bylaws, articles

of incorporation, occupancy agreement, subscription agreement, any

lease of the regulated premises, any arrangement with partners, and

arrangement for membership share accounts provide adequate protection

of the rights of cooperative members.

(5) The federal or state agency shall receive from the attorney

for the recipient of the financing or subsidy a legal opinion that

the cooperative meets the requirements of Section 33007.5 of the

Health and Safety Code and the exemption provided by this section.

(c) Any limited-equity cooperative which meets the requirements

for exemption pursuant to subdivision (b) may elect to be subject to

all provisions of this chapter.

(d) The developer of the cooperative shall notify the Department

of Real Estate, on a form provided by the department, that an

exemption is claimed under this section. The Department of Real

Estate shall retain this form for at least four years for statistical

purposes.

 

 

11004. "Community apartment project" has the same meaning as

specified in subdivision (d) of Section 1351 of the Civil Code.

 

 

 

11004.5. In addition to any provisions of Section 11000 of this

code the reference therein to "subdivided lands" and "subdivision"

shall include all of the following:

(a) Any planned development, as defined in Section 11003 of this

code, containing five or more lots.

(b) Any community apartment project, as defined by Section 11004

of this code, containing five or more apartments.

(c) Any condominium project containing five or more condominiums

as defined in Section 783 of the Civil Code.

(d) Any stock cooperative as defined in Section 11003.2, including

any legal or beneficial interests therein, having or intended to

have five or more shareholders.

(e) Any limited-equity housing cooperative, as defined in Section

11003.4.

(f) In addition, the following interests shall be subject to the

provisions of this chapter and the regulations of the commissioner

adopted pursuant thereto:

(1) Any accompanying memberships or other rights or privileges

created in, or in connection with, any of the forms of development

referred to in subdivision (a), (b), (c), (d), (e), or (f) above by

any deeds, conveyances, leases, subleases, assignments, declarations

of restrictions, articles of incorporation, bylaws or contracts

applicable thereto.

(2) Any interests or memberships in any owners' association as

described in Section 11003.1 created in connection with any of the

forms of the development referred to in subdivision (a), (b), (c),

(d), (e), or (f) above.

(g) Notwithstanding this section, time-share plans, exchange

programs, incidental benefits, and short term product subject to

Chapter 2 (commencing with Section 11210) of Part 2 of Division 4 of

the Business and Professions Code are not "subdivisions" or

"subdivided lands" subject to this chapter.

 

 

 

11007. Every nonresident subdivider shall file with the

questionnaire an irrevocable consent that if, in any action commenced

against him in this State, personal service of process upon him

cannot be made in this State after the exercise of due diligence, a

valid service may thereupon be made upon him by delivering the

process to the Secretary of State.

Insofar as possible, the provisions of Section 1018 of the Code of

Civil Procedure relating to the service of process on the Secretary

of State are applicable to this section.

 

 

 

11008. No provision of this part which makes a violation of this

part a crime shall be construed to preclude application of any other

criminal provision of the law of this state to an act or omission

which constitutes a violation of this part.

 

 

 

11010.  (a) Except as otherwise provided pursuant to subdivision (c)

or elsewhere in this chapter, any person who intends to offer

subdivided lands within this state for sale or lease shall file with

the Department of Real Estate an application for a public report

consisting of a notice of intention and a completed questionnaire on

a form prepared by the department.

   (b) The notice of intention shall contain the following

information about the subdivided lands and the proposed offering:

   (1) The name and address of the owner.

   (2) The name and address of the subdivider.

   (3) The legal description and area of lands.

   (4) A true statement of the condition of the title to the land,

particularly including all encumbrances thereon.

   (5) A true statement of the terms and conditions on which it is

intended to dispose of the land, together with copies of any

contracts intended to be used.

   (6) A true statement of the provisions, if any, that have been

made for public utilities in the proposed subdivision, including

water, electricity, gas, telephone, and sewerage facilities.  For

subdivided lands that were subject to the imposition of a condition

pursuant to subdivision (b) of Section 66473.7 of the Government

Code, the true statement of the provisions made for water shall be

satisfied by submitting a copy of the written verification of the

available water supply obtained pursuant to Section 66473.7 of the

Government Code.

   (7) A true statement of the use or uses for which the proposed

subdivision will be offered.

   (8) A true statement of the provisions, if any, limiting the use

or occupancy of the parcels in the subdivision.

   (9) A true statement of the amount of indebtedness that is a lien

upon the subdivision or any part thereof, and that was incurred to

pay for the construction of any onsite or offsite improvement, or any

community or recreational facility.

   (10) A true statement or reasonable estimate, if applicable, of

the amount of any indebtedness which has been or is proposed to be

incurred by an existing or proposed special district, entity, taxing

area, assessment district, or community facilities district within

the boundaries of which, the subdivision, or any part thereof, is

located, and that is to pay for the construction or installation of

any improvement or to furnish community or recreational facilities to

that subdivision, and which amounts are to be obtained by ad valorem

tax or assessment, or by a special assessment or tax upon the

subdivision, or any part thereof.

   (11) (A) As to each school district serving the subdivision, a

statement from the appropriate district that indicates the location

of each high school, junior high school, and elementary school

serving the subdivision, or documentation that a statement to that

effect has been requested from the appropriate school district.

   (B) In the event that, as of the date the notice of intention and

application for issuance of a public report are otherwise deemed to

be qualitatively and substantially complete pursuant to Section

11010.2, the statement described in subparagraph (A) has not been

provided by any school district serving the subdivision, the person

who filed the notice of intention and application for issuance of a

public report shall immediately provide the department with the name,

address, and telephone number of that district.

   (12) (A) The location of all existing airports, and of all

proposed airports shown on the general plan of any city or county,

located within two statute miles of the subdivision.  If the property

is located within an airport influence area, the following statement

shall be included in the notice of intention:

 

 

                     NOTICE OF AIRPORT IN VICINITY

 

      This property is presently located in the vicinity of an

airport,

  within what is known as an airport influence area.  For that

reason,

  the property may be subject to some of the  annoyances or

inconveniences

  associated with proximity to airport operations (for example:

noise,

  vibration, or odors).  Individual sensitivities to those annoyances

can

  vary from person to person.  You may wish to consider what airport

  annoyances, if any, are associated with the property before you

  complete your purchase and determine whether they are acceptable to

you.

 

   (B) For purposes of this section, an "airport influence area,"

also known as an "airport referral area," is the area in which

current or future airport-related noise, overflight, safety, or

airspace protection factors may significantly affect land uses or

necessitate restrictions on those uses as determined by an airport

land use commission.

   (13) A true statement, if applicable, referencing any soils or

geologic report or soils and geologic reports that have been prepared

specifically for the subdivision.

   (14) A true statement of whether or not fill is used, or is

proposed to be used in the subdivision and a statement giving the

name and the location of the public agency where information

concerning soil conditions in the subdivision is available.

   (15) On or after July 1, 2005, as to property located within the

jurisdiction of the San Francisco Bay Conservation and Development

Commission, a statement that the property is so located and the

following notice:

      NOTICE OF SAN FRANCISCO BAY CONSERVATION AND DEVELOPMENT

COMMISSION JURISDICTION

 

   This property is located within the jurisdiction of the San

Francisco Bay Conservation and Development Commission.  Use and

development of property within the commission's jurisdiction may be

subject to special regulations, restrictions, and permit

requirements.  You may wish to investigate and determine whether they

are acceptable to you and your intended use of the property before

you complete your transaction.

   (16) Any other information that the owner, his or her agent, or

the subdivider may desire to present.

   (c) The commissioner may, by regulation, or on the basis of the

particular circumstances of a proposed offering, waive the

requirement of the submission of a completed questionnaire if the

commissioner determines that prospective purchasers or lessees of the

subdivision interests to be offered will be adequately protected

through the issuance of a public report based solely upon information

contained in the notice of intention.

 

 

 

11010.05.  A person who proposes to create a senior citizen housing

development, as defined in Section 51.3 or 51.11 of the Civil Code,

shall include in the application for a public report a complete

statement of the restrictions on occupancy that are to be applicable

in the development.  Any public report issued for a senior housing

development shall also include a complete statement of the

restrictions on occupancy to be applicable in the development.  This

section shall become operative on July 1, 2001, and shall apply to

all applications for a public report for a senior housing development

submitted to the department on or after July 1, 2001.

 

 

 

 

11010.1.  Prior to the issuance of promissory notes secured by

individual lots in an unrecorded subdivision, the owner, his agent or

subdivider shall notify the commissioner in writing of his intention

to issue such notes.

   The notice of intention shall contain the following information:

   (a) The name and address of the owner.

   (b) The name and address of the subdivider.

   (c) The legal description and area of lands.

   (d) A true statement of the condition of the title to the land,

particularly including all encumbrances thereon.

   (e) A true statement of the terms and conditions on which it is

intended to issue the promissory notes.

   (f) A true statement of the provisions, if any, that have been

made for public utilities in the proposed subdivision, including

water, electricity, gas and telephone facilities.

   (g) Such other information as the owner, his agent or subdivider,

may desire to present.

 

 

11010.2.  (a) As used in this section:

   (1) "Quantitative" means the number and type of documents required

to make the filing substantially complete, as defined in the

regulations of the commissioner, without regard to the content of

those requirements.

   (2) "Qualitatively complete" means that all deficiencies and

substantive inadequacies contained in the documents that were

required to make the filing substantially complete have been

corrected.

   (3) "Substantially complete" means that a notice and application

contain all requirements as set forth in the regulations of the

commissioner.

   (b) Upon receipt of a notice of intention pursuant to Section

11010 and an application for issuance of a public report, the

commissioner shall review the notice and application to determine if

the notice and application are substantially complete, with respect

to quantitative requirements.  The commissioner shall notify the

applicant in writing of that determination within 10 days of receipt

of the notice and application.

   (1) If the notice and application are not substantially complete

with respect to the quantitative requirements pursuant to this

subdivision, the notification shall specify the information needed to

make the notice and application substantially complete.  Upon

receipt of any resubmittal of a notice and application, the

commissioner shall notify the applicant in writing of that

determination within 10 days of receipt of the notice and

application.

   (2) If the commissioner determines that the notice and application

are substantially complete with respect to the quantitative

requirements pursuant to this subdivision, the commissioner shall

provide the applicant with a list of all deficiencies and substantive

inadequacies necessary for the notice and application to be

qualitatively complete, within 60 days of that determination, in the

case of subdivisions specified in Section 11000.1 or 11004.5, and

within 20 days of that determination, in the case of other

subdivisions.

   (c) Upon receipt of all documents, materials, writings, and other

information submitted in response to the list in paragraph (2) of

subdivision (b), the commissioner shall notify the applicant whether

the notice and application are qualitatively complete within 30 days,

in the case of subdivisions specified in Section 11000.1 or 11004.5,

and within 20 days of receipt, in the case of other subdivisions.

If the application and notice are not qualitatively complete, the

notification shall include a list of any remaining deficiencies and

substantive inadequacies.  Upon receipt of any resubmittal of

documents, materials, writings, and other information in response to

a list of any remaining deficiencies and substantive inadequacies,

the commissioner shall provide notification within the time limits

specified in this subdivision.

   (d) The commissioner shall issue a public report within 15 days,

in the case of a subdivision specified in Section 11000.1 or 11004.5,

or 10 days, in the case of other subdivisions, after the notice and

application are determined to be qualitatively and substantially

complete, and submittal of recorded or filed instruments and evidence

of financial arrangements required by the commissioner.

   (e) Upon receipt of an application for approval of a declaration

as provided in Section 11010.10, the commissioner shall notify the

applicant of any deficiency or inadequacy in the declaration within

60 days of its receipt.  The commissioner shall notify the applicant

of any deficiency or inadequacy in a declaration that has been

revised following the first notice of deficiency or inadequacy within

30 days of its receipt.

   (f) The commissioner shall adopt regulations, in accordance with

Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3

of Title 2 of the Government Code, that define "substantially

complete" and that list all the requirements necessary for a notice

of intention and application to be considered "substantially

complete."

   (g) The commissioner may adopt emergency regulations, in

accordance with Chapter 3.5 (commencing with Section 11340) of Part 1

of Division 3 of Title 2 of the Government Code, to increase, as set

forth below, those time periods specified in subdivisions (b), (c),

and (d), upon a showing that the number of notices of intention and

applications for a subdivision public report filed with the

department for any immediately preceding six-month period has

increased by more than 15 percent over the monthly average number of

notices and applications filed for the base period commencing July 1,

1983, and ending June 30, 1986:

   (1) The time for issuing the notice provided in subdivision (b)

shall increase to 15 days.

   (2) The time for providing the listing required by paragraph (2)

of subdivision (b) shall increase to 90 days, in the case of

subdivisions specified in Sections 11000.1 and 11004.5, and to 30

days, in the case of other subdivisions.

   (3) The time period provided in subdivision (c) for responding to

receipt of documents intended to correct deficiencies shall be 30

days without regard to the type of subdivision being processed.

   (4) The time periods provided in subdivision (d) within which the

commissioner is required to issue a public report in the case of

subdivisions specified in Sections 11000.1 and 11004.5, shall

increase to 30 days and in the case of other subdivisions shall

increase to 15 days.

   This section does not apply to filings made exclusively under

Section 11010.1.  Nothing in this section requires the commissioner

to issue a public report where grounds for denial exist, provided

that issuance of a public report shall not be denied for inadequate

information if the cause thereof is the commissioner's failure to

comply with this section.

   Notwithstanding other provisions of this section, the commissioner

shall not be required to issue a public report if grounds for denial

exist under Section 11018 or 11018.5.  However, the commissioner may

not base the denial of a public report on the lack of adequate

information if the commissioner has not acted within the time periods

prescribed in this section.

 

 

 

11010.3.  The provisions of this chapter shall not apply to the

proposed sale or lease of lots or other interests in a subdivision in

which  lots or other interests are (a) limited to industrial or

commercial uses by zoning or (b) limited to industrial or commercial

uses by a declaration of covenants, conditions, and restrictions,

which declaration has been recorded in the official records of the

county or counties in which the subdivision is located.

 

 

 

11010.35.  (a) The provisions of this chapter shall not apply to the

proposed sale or lease of five or more lots, parcels, or other

interests in a subdivision or the sale of one or more lots or parcels

in a subdivision where the lot or lots or parcel or parcels are

intended to be further subdivided into five or more lots, parcels, or

other subdivision interests as defined in Sections 11000, 11000.1,

and 11004.5, to any person who acquires the lots, parcels, or other

subdivision interests for the purpose of engaging in the business of

constructing residential, commercial, or industrial buildings, or for

the purpose of resale or lease of the lots, parcels, or other

subdivision interests to persons engaged in this business, provided

that the purchase or lease agreement or a separate disclosure

document includes a statement or provision that the purchaser or

lessee is required to comply with the applicable provisions of this

chapter prior to offering for sale or lease any lot, parcel, or other

subdivision interest acquired pursuant to the exemption granted by

this subdivision.

   (b) The exemption provided by subdivision (a) does not apply to a

proposed sale or lease of lots, parcels, or other subdivision

interests that is done for the purpose of evading any other provision

of this chapter.

   (c) The provisions of subdivision (a) are intended to clarify the

application of this chapter to the commercial sale or lease of

residential subdivision interests and should not be interpreted to

impose requirements on transactions entered into prior to the date on

which this section became operative.

 

 

 

11010.4.  The notice of intention specified in Section 11010 is not

required for a proposed offering of subdivided land that satisfies

all of the following criteria:

   (a) The owner, subdivider, or agent has complied with Sections

11013.1, 11013.2, and 11013.4, if applicable.

   (b) The subdivided land is not a subdivision as defined in Section

11000.1 or 11004.5.

   (c) Each lot, parcel or unit of the subdivision is located

entirely within the boundaries of a city.

   (d) Each lot, parcel or unit of the subdivision will be sold or

offered for sale improved with a completed residential structure and

with all other improvements completed that are necessary to occupancy

or with financial arrangements determined to be adequate by the city

to ensure completion of the improvements.

 

 

11010.5.  The filing of a second notice of intention to sell and a

second report of the commissioner under this article shall not be

required when all the following conditions have been met:  (a) where

there has been a previous subdivision report and the lots are

subsequently acquired through any foreclosure action, or by a deed in

lieu of foreclosure, by a bank, life insurance company, industrial

loan company, credit union, or savings and loan association licensed

or operating under the provisions of a state or federal law if the

acquired lots, either improved or unimproved, will be sold in

conformance with the previously issued subdivision public report; (b)

the original public report is given to the first purchasers of the

lots in the foreclosed subdivision; and (c) the commissioner is

notified of the change of ownership within 30 days of the acquisition

of the title to such property.

 

 

 

11010.6.  The provisions of this chapter shall not be applicable to

subdivided land which is offered or proposed to be offered for sale,

lease, or financing by a state agency, including the University of

California, a local agency, or other public agency.

 

 

 

11010.7.  The notice of intention specified in Section 11010 shall

not apply to nonbinding expressions of intent to purchase or lease

which an owner, agent, or subdivider is required to obtain from the

tenants of units which are proposed to be converted to a condominium,

community apartment project, or stock cooperative project, by

ordinance, or as a condition to the approval of a tentative or parcel

map pursuant to Division 2 (commencing with Section 66410) of Title

7 of the Government Code.

 

 

 

11010.8.  (a) The requirement that a notice of intention be filed

pursuant to Section 11010 is not applicable to the purchase of a

mobilehome park by a nonprofit corporation if all of the following

occur:

   (1) A majority of the shareholders or members of the nonprofit

corporation constitute a majority of the homeowners of the mobilehome

park, and a majority of the members of the board of directors of the

nonprofit corporation are homeowners of the mobilehome park.

   (2) All members of the corporation are residents of the mobilehome

park.  Members of the nonprofit corporation may enter into leases

with the corporation that are greater than five years in length.

"Homeowners" or "residents" of the mobilehome park shall include a

bona fide secured party who has, pursuant to a security interest in a

membership, taken title to the membership by means of foreclosure,

repossession, or voluntary repossession, and who is actively

attempting to resell the membership to a prospective resident or

homeowner of the mobilehome park, in accordance with subdivision (f)

of Section 7312 of the Corporations Code.

   (3) A permit to issue securities under Section 25113 of the

Corporations Code is obtained from the Department of Corporations.

In the case of a nonissuer transaction (as defined by Section 25011

of the Corporations Code) involving the offer to resell or the resale

of memberships by a bona fide secured party as described in

paragraph (2) of this section, a permit is not required where the

transaction is exempt from the qualification requirements of Section

25130 of the Corporations Code pursuant to subdivision (e) of Section

25104 of the Corporations Code.  The exemption from qualification

pursuant to subdivision (e) of Section 25104 of the Corporations Code

available to a bona fide secured party does not eliminate the

requirement of this section that the nonprofit corporation shall

either file a notice of intention pursuant to Section 11010 or obtain

a permit pursuant to Section 25113 of the Corporations Code.

   (4) All funds of tenants for the purchase of the mobilehome park

are deposited in escrow until the document transferring title of the

mobilehome park to the nonprofit corporation is recorded.  The escrow

also shall include funds of homeowners that shall be available to

the homeowners association nonprofit corporation for payment of any

and all costs reasonably associated with the processing and

conversion of the mobilehome park into condominium interests.

Payment of these costs may be made from the funds deposited in escrow

prior to the close of escrow upon the direction of the homeowners

association nonprofit corporation.

   (b) The funds described by paragraph (4) of subdivision (a), or

any other funds subsequently received from tenants for purposes other

than the purchase of a separate subdivided interest in any portion

of the mobilehome park, are not subject to the requirements of

Section 11013.1, 11013.2, or 11013.4.

 

 

 

11010.9.  (a) Notwithstanding any other provision of law, the

subdivider of a mobilehome park that is proposed to be converted to

resident ownership, prior to filing a notice of intention pursuant to

Section 11010, shall disclose to homeowners and residents of the

park, by written notice, the tentative price of the subdivided

interest proposed to be sold or leased.

   (b) The disclosure notice required by subdivision (a) shall

include a statement that the tentative price is not binding, could

change between the time of disclosure and the time of governmental

approval to commence the actual sale or lease of the subdivided

interests in the park, as the result of conditions imposed by the

state or local government for approval of the park conversion,

increased financing costs, or other factors and, in the absence of

bad faith, shall not give rise to a claim for liability against the

provider of this information.

   (c) The disclosure notice required by subdivision (a) shall not be

construed to authorize the subdivider of a mobilehome park that is

proposed to be converted to resident ownership to offer to sell or

lease, sell or lease, or accept money for the sale or lease of,

subdivided interests in the park, or to engage in any other

activities that are otherwise prohibited, with regard to subdividing

the park into ownership interests, prior to the issuance of a public

report pursuant to this chapter.

 

 

11010.10.  A person who plans to offer for sale or lease lots or

other interests in a subdivision which sale or lease (a) is not

subject to the provisions of this chapter, (b) does not require the

submission of a notice of intention as provided in Section 11010, or

(c) is subject to this chapter and for which the local jurisdiction

requires review and approval of the declaration, as defined in

subdivision (h) of Section 1351 of the Civil Code, prior to or

concurrently with the recordation of the subdivision map and prior to

the approval of the declaration pursuant to a notice of intention

for a public report, may submit an application requesting review of

the declaration, along with any required supporting documentation, to

the commissioner, without the filing of a notice of intention for

the subdivision for which the declaration is being prepared.  Upon

approval, the commissioner shall give notice to the applicant that

the declaration shall be approved for a subsequent notice of intent

filing for any public report for the subdivision identified in the

application, provided that the subdivision setup is substantially the

same as that originally described in the application for review of

the declaration.

 

 

 

11010.11.  Notwithstanding any provision in the purchase contract to

the contrary, if the subdivision is to be used for residential

purposes, the subdivision public report shall disclose that a

prospective buyer has the right to negotiate with the seller to

permit inspections of the property by the buyer, or the buyer's

designee, under terms mutually agreeable to the prospective buyer and

seller.

 

 

 

11011.  (a) The commissioner may by regulation prescribe filing fees

in connection with applications to the Department of Real Estate

pursuant to this chapter that are lower than the maximum fees

specified in subdivision (b) if the commissioner determines that the

lower fees are sufficient to offset the costs and expenses incurred

in the administration of this chapter.  The commissioner shall hold

at least one hearing each calendar year to determine if lower fees

than those specified in subdivision (b) should be prescribed.

   (b) The filing fee for an application for a public report to be

issued under authority of this chapter shall not exceed the following

for each subdivision or phase of a subdivision in which interests

are to be offered for sale or lease:

   (1) A notice of intention without a completed questionnaire:  One

hundred fifty dollars ($150).

   (2) An original public report for subdivision interests described

in Section 11004.5:  One thousand seven hundred dollars ($1,700) plus

ten dollars ($10) for each subdivision interest to be offered.

   (3) An original public report for subdivision interests other than

those described in Section 11004.5:  Six hundred dollars ($600) plus

ten dollars ($10) for each subdivision interest to be offered.

   (4) A conditional public report for subdivision interests

described in Section 11004.5:  Five hundred dollars ($500).

   (5) A conditional public report for subdivision interests other

than those described in Section 11004.5:  Five hundred dollars

($500).

   (6) A preliminary public report for subdivision interests

described in Section 11004.5:  Five hundred dollars ($500).

   (7) A preliminary public report for subdivision interests other

than those described in Section 11004.5:  Five hundred dollars

($500).

   (8) A renewal public report for subdivision interests described in

Section 11004.5:  Six hundred dollars ($600).

   (9) A renewal public report for subdivision interests other than

those described in Section 11004.5:  Six hundred dollars ($600).

   (10) An amended public report for subdivision interests described

in Section 11004.5:  Five hundred dollars ($500) plus ten dollars

($10) for each subdivision interest to be offered under the amended

public report for which a fee has not previously been paid.

   (11) An amended public report to offer subdivision interests other

than those described in Section 11004.5:  Five hundred dollars

($500) plus ten dollars ($10) for each subdivision interest to be

offered under the amended public report for which a fee has not

previously been paid.

   (c) The filing fee to review a declaration as described in Section

11010.10 shall not exceed two hundred dollars ($200).

   (d) The actual subdivision fees established by regulation under

authority of this section and Section 10249.3 shall not exceed the

amount reasonably required by the department to administer this part

and Article 8 (commencing with Section 10249) of Chapter 3 of Part 1.

 

   (e) All fees collected by the department under authority of this

chapter shall be deposited into the Real Estate Fund under Chapter 6

(commencing with Section 10450) of Part 1.  All fees received by the

department pursuant to this chapter shall be deemed earned upon

receipt.  No part of any fee is refundable unless the commissioner

determines that it was paid as the result of a mistake or

inadvertence.

   This section shall remain in effect unless it is superseded

pursuant to Section 10226 or subdivision (a) of Section 10226.5,

whichever is applicable.

 

 

11012.  It is unlawful for the owner, his agent, or subdivider, of

the project, after it is submitted to the Department of Real Estate,

to materially change the setup of such offering without first

notifying the Department of Real Estate in writing of such intended

change.  This section only applies to those changes of which the

owner, his agent, or subdivider has knowledge or constructive

knowledge.

 

 

 

11013.  For the purposes of this part, a blanket encumbrance shall

be considered to mean a trust deed or mortgage or any other lien or

encumbrance, mechanics' lien or otherwise, securing or evidencing the

payment of money and affecting land to be subdivided or affecting

more than one lot or parcel of subdivided land, or an agreement

affecting more than one such lot or parcel by which the owner or

subdivider holds said subdivision under an option, contract to sell,

or trust agreement.

 

 

 

11013.1.  It shall be unlawful, except as provided in Section

11013.2, for the owner, subdivider, or agent to sell or lease lots or

parcels within a subdivision that is subject to a blanket

encumbrance unless there exists in such blanket encumbrance or other

supplementary agreement a provision, hereinafter referred to as a

release clause, which by its terms shall unconditionally provide that

the purchaser or lessee of a lot or parcel can obtain legal title or

other interest contracted for, free and clear of such blanket

encumbrance, upon compliance with the terms and conditions of the

purchase or lease.

 

 

11013.2.  Should there not exist in the blanket encumbrance or

supplementary agreement a release clause as set forth in Section

11013.1, then it shall be unlawful for the owner, subdivider, or

agent to sell or lease lots or parcels within such subdivision unless

one of the following conditions is complied with:

   (a) The entire sum of money paid or advanced by the purchaser or

lessee of any such lot or parcel, or such portion thereof as the

commissioner shall determine is sufficient to protect the interest of

the purchaser or lessee, shall be deposited into an escrow

depository acceptable to the commissioner until either (1) a proper

release is obtained from such blanket encumbrance; or (2)  either the

owner, subdivider, or agent or the purchaser or lessee may default

under their contract of sale or lease and there is a determination as

to the disposition of such moneys; or (3) the owner, subdivider, or

agent orders the return of such moneys to such purchaser or lessee.

   (b) The title to the subdivision is to be held in trust under an

agreement of trust acceptable to the commissioner until a proper

release from such blanket encumbrance is obtained.

   (c) A bond to the State of California is furnished to the

commissioner for the benefit and protection of purchasers or lessees

of such lots or parcels, in such amount and subject to such terms as

may be approved by the commissioner, which shall provide for the

return of the moneys paid or advanced by any purchaser or lessee, for

or on account of the purchase or lease of any such lot or parcel if

a proper release from such blanket encumbrance is not obtained;

provided, however, that if it should be determined that such

purchaser or lessee, by reason of default or otherwise, is not

entitled to the return of such moneys, or any portion thereof, then

such bond shall be exonerated to the extent of the amount of such

moneys to which such purchaser or lessee is not entitled.

   (d) There is conformance to such other alternative requirement or

method which the commissioner may deem acceptable to carry into

effect the intent and provisions of this part.

 

 

 

11013.3.  Taxes and assessments levied by public authority shall not

be considered a blanket encumbrance within the meaning of Section

11013.

 

 

11013.4.  If a subdivision is not subject to a blanket encumbrance,

as defined in Section 11013, it is unlawful for the owner,

subdivider, or agent to sell or lease lots or parcels within a

subdivision unless one of the following conditions is complied with:

 

   (a) The entire sum of money paid or advanced by the purchaser or

lessee of any lot or parcel, or such portion thereof as the

commissioner determines is sufficient to protect the interest of the

purchaser or lessee, is deposited into an escrow depository

acceptable to the commissioner or into a trust account acceptable to

the commissioner to be held in the escrow depository or trust account

until the legal title or other interest contracted for, whether

title of record or other interest, is delivered to the purchaser or

lessee or until (1) either the owner, subdivider, or agent or the

purchaser or lessee defaults under the contract of sale or lease and

a determination is made as to the disposition of the money; or (2)

the owner, subdivider, or agent orders the return of the money to the

purchaser or lessee.

   (b) A bond to the State of California is furnished to the

commissioner for the benefit and protection of purchasers or lessees

of the lots or parcels, in such amount and subject to such terms as

may be approved by the commissioner, which provides for the return of

the money paid or advanced by any purchaser or lessee, for or on

account of the purchase or lease of any lot or parcel in the event

that the owner, subdivider, or agent does not, within the time

specified in the contract to sell or lease, or any extension thereof,

deliver the legal title or other interest contracted for, whether

title of record or other interest, to the purchaser or lessee for any

reason other than an uncured default of the purchaser or lessee.

   (c) An association, approved by the commissioner, files with the

commissioner a certificate in which it certifies that the owner,

subdivider, or agent is a member of the association and that there is

on file with the commissioner a bond, of the kind specified in

subdivision (b), which has been approved by the commissioner as to

amount, terms and coverage, and which is for the benefit and

protection of all purchasers and lessees of subdivided lots or

parcels to be sold or leased by members of the association (all which

the commissioner may, at the commissioner's option, verify or

require to be verified).

   (d) Proof, satisfactory to the commissioner, is furnished:  (1)

that security provided or contemplated to be given pursuant to the

provisions of Section 66493 and Chapter 5 (commencing with Section

66499) of Division 2 of Title 7 of the Government Code, has been

given in an amount, the commissioner approves, or that the giving of

such security is unnecessary; and (2) that a lien and completion bond

or bonds, approved by the commissioner as to amount, terms and

coverage and including within its scope all onsite construction work

to be undertaken on the lots or parcels, has been written and issued

by an admitted surety insurer; provided, however, that this

subdivision applies only to an owner, subdivider, or agent who

proposes to sell or lease the lots or parcels with improvements

thereon in the nature of residential structures.

   (e) The entire sums of moneys paid or advanced by the purchasers

or lessees of the lots or parcels, or such portion of the money as

the commissioner determines is sufficient to protect the interest of

the purchaser or lessee, is deposited into an escrow depository or

other agency, acceptable to the commissioner, to be held, in whole or

in part, by the escrow depository or other agency as provided by

subdivision (a) or, at the election of the owner, subdivider, or

agent, to be disbursed, in whole or in part, for the construction of

residential or other structures to be built on the lots or parcels

within the subdivision, or such unit or units thereof as the

commissioner determines, in such manner and pursuant to such

instructions as the commissioner approves; provided, however, that

the provisions of this subdivision apply only to an owner,

subdivider, or agent who proposes to sell or lease the lots or

parcels with improvements thereon in the nature of residential

structures.

   (f) There is conformance to such other alternative requirement or

method the commissioner deems acceptable to carry into effect the

intent and provisions of this part.

 

 

 

11013.5.  The public report of the commissioner, when issued, shall

indicate the method or procedure selected by the owner or subdivider

to comply with the provisions of Sections 11013.1, 11013.2 or

11013.4.

 

 

11014.  The commissioner may investigate any subdivision being

offered for sale or lease in this State.  For the purposes of such

investigations the commissioner may use and rely upon any relevant

information or data concerning a subdivision obtained by him from the

Federal Housing Administration, the United States Veterans

Administration or any other federal agency having comparable duties

and functions in relation to subdivisions or property therein.

 

 

 

11018.  The Real Estate Commissioner shall make an examination of

any subdivision, and shall, unless there are grounds for denial,

issue to the subdivider a public report authorizing the sale or lease

in this state of the lots or parcels within the subdivision.  The

report shall contain the data obtained in accordance with Section

11010 and which the commissioner determines are necessary to

implement the purposes of this article.  The commissioner may publish

the report.

   The grounds for denial are:

   (a) Failure to comply with any of the provisions in this chapter

or the regulations of the commissioner pertaining thereto.

   (b) The sale or lease would constitute misrepresentation to or

deceit or fraud of the purchasers or lessees.

   (c) Inability to deliver title or other interest contracted for.

   (d) Inability to demonstrate that adequate financial arrangements

have been made for all offsite improvements included in the offering.

 

   (e) Inability to demonstrate that adequate financial arrangements

have been made for any community, recreational or other facilities

included in the offering.

   (f) Failure to make a showing that the parcels can be used for the

purpose for which they are offered; and in the case of a subdivision

being offered for residential purposes failure to make a showing

that vehicular access and a source of potable domestic water either

is available or will be available.

   (g) Failure to provide in the contract or other writing the use or

uses for which the parcels are offered, together with any covenants

or conditions relative thereto.

   (h) Agreements or bylaws to provide for management or other

services pertaining to common facilities in the offering, which fail

to comply with the regulations of the commissioner.

   (i) Failure to demonstrate that adequate financial arrangements

have been made for any guaranty or warranty included in the offering.

 

 

 

 

11018.1.  (a) A copy of the public report of the commissioner, when

issued, shall be given to the prospective purchaser by the owner,

subdivider or agent prior to the execution of a binding contract or

agreement for the sale or lease of any lot or parcel in a

subdivision.  The requirement of this section extends to lots or

parcels offered by the subdivider after repossession.  A receipt

shall be taken from the prospective purchaser in a form and manner as

set forth in regulations of the Real Estate Commissioner.

   (b) A copy of the public report shall be given by the owner,

subdivider or agent at any time, upon oral or written request, to any

member of the public.  A copy of the public report and a statement

advising that a copy of the public report may be obtained from the

owner, subdivider or agent at any time, upon oral or written request,

shall be posted in a conspicuous place at any office where sales or

leases or offers to sell or lease lots within the subdivision are

regularly made.

   (c) At the same time that a public report is required to be given

by the owner, subdivider, or agent pursuant to subdivision (a) with

respect to a common interest development, as defined, in subdivision

(c) of Section 1351 of the Civil Code, the owner, subdivider, or

agent shall give the prospective purchaser a copy of the following

statement:

 

      "COMMON INTEREST DEVELOPMENT GENERAL INFORMATION

 

   The project described in the attached Subdivision Public Report is

known as a common-interest development.  Read the public report

carefully for more information about the type of development.  The

development includes common areas and facilities which will be owned

or operated by an owners' association.  Purchase of a lot or unit

automatically entitles and obligates you as a member of the

association and, in most cases, includes a beneficial interest in the

areas and facilities.  Since membership in the association is

mandatory, you should be aware of the following information before

you purchase:

   Your ownership in this development and your rights and remedies as

a member of its association will be controlled by governing

instruments which generally include a Declaration of Restrictions

(also known as CC&R's), Articles of Incorporation (or association)

and bylaws.  The provisions of these documents are intended to be,

and in most cases are, enforceable in a court of law.  Study these

documents carefully before entering into a contract to purchase a

subdivision interest.

   In order to provide funds for operation and maintenance of the

common facilities, the association will levy assessments against your

lot or unit.  If you are delinquent in the payment of assessments,

the association may enforce payment through court proceedings or your

lot or unit may be liened and sold through the exercise of a power

of sale.  The anticipated income and expenses of the association,

including the amount that you may expect to pay through assessments,

are outlined in the proposed budget.  Ask to see a copy of the budget

if the subdivider has not already made it available for your

examination.

   A homeowner association provides a vehicle for the ownership and

use of recreational and other common facilities which were designed

to attract you to buy in this development.  The association also

provides a means to accomplish architectural control and to provide a

base for homeowner interaction on a variety of issues.  The

purchaser of an interest in a common-interest development should

contemplate active participation in the affairs of the association.

He or she should be willing to serve on the board of directors or on

committees created by the board.  In short, "they" in a common

interest development is "you."  Unless you serve as a member of the

governing board or on a committee appointed by the board, your

control of the operation of the common areas and facilities is

limited to your vote as a member of the association.  There are

actions that can be taken by the governing body without a vote of the

members of the association which can have a significant impact upon

the quality of life for association members.

   Until there is a sufficient number of purchasers of lots or units

in a common interest development to elect a majority of the governing

body, it is likely that the subdivider will effectively control the

affairs of the association.  It is frequently necessary and equitable

that the subdivider do so during the early stages of development.

It is vitally important to the owners of individual subdivision

interests that the transition from subdivider to resident-owner

control be accomplished in an orderly manner and in a spirit of

cooperation.

   When contemplating the purchase of a dwelling in a common interest

development, you should consider factors beyond the attractiveness

of the dwelling units themselves.  Study the governing instruments

and give careful thought to whether you will be able to exist happily

in an atmosphere of cooperative living where the interests of the

group must be taken into account as well as the interests of the

individual.  Remember that managing a common interest development is

very much like governing a small community ...  the management can

serve you well, but you will have to work for its success."

 

   Failure to provide the statement in accordance with this

subdivision shall not be deemed a violation subject to Section 10185.

 

 

 

 

11018.2.  No person shall sell or lease, or offer for sale or lease

in this state any lots or parcels in a subdivision without first

obtaining a public report from the Real Estate Commissioner.  This

section shall not apply to subdivisions for which a notice of

intention is not required under the provisions of this chapter.

 

 

 

 

11018.3.  Any subdivider objecting to the denial of a public report

may, within 30 days after receipt of the order of denial, file a

written request for a hearing.  The commissioner shall hold the

hearing within 20 days thereafter unless the party requesting the

hearing requests a postponement. If the hearing is not held within 20

days after request for a hearing is received plus the period of the

postponement or if a proposed decision is not rendered within 45 days

after submission and an order adopting or rejecting the proposed

decision is not issued within 15 days thereafter, the order of denial

shall be rescinded and a public report issued.

 

 

 

11018.5.  With respect to the subdivisions and interests of the type

described in Section 11004.5, and in addition to the other grounds

for denial of a public report as set forth in this code, the

commissioner shall issue a public report if the commissioner finds

the following with respect to any such subdivision or interest:

   (a) (1) Reasonable arrangements have been made to assure

completion of the subdivision and all offsite improvements included

in the offering.

   (2) If the condominium or community apartment project, stock

cooperative or planned development, or premises or facilities within

the common area are not completed prior to the issuance of a final

subdivision public report on the project, the subdivider shall

specify a reasonable date for completion and shall comply with one of

the following conditions:

   (A) Arranges for lien and completion bond or bonds in an amount

and subject to such terms, conditions and coverage as the

commissioner may approve to assure completion of the improvements

lien free.

   (B) All funds from the sale of lots or parcels or such portions

thereof as the commissioner shall determine are sufficient to assure

construction of the improvement or improvements, shall be impounded

in a neutral escrow depository acceptable to the commissioner until

the improvements have been completed and all applicable lien periods

have expired; provided, however, the commissioner determines the time

for the completion is reasonable.

   (C) An amount sufficient to cover the costs of construction shall

be deposited in a neutral escrow depository acceptable to the

commissioner under a written agreement providing for disbursements

from that escrow as work is completed.

   (D) If the project is a condominium situated on a single parcel as

shown on an approved final subdivision map, arrange for (i) lien and

completion bond or bonds in an amount sufficient to assure lien-free

completion of all common area improvements not located in a

residential structure, and (ii) placement of all funds, or such

portions thereof as the commissioner shall determine are sufficient,

from the sales of condominium interests in a neutral escrow

depository acceptable to the commissioner.  The funds for purchase or

lease of the condominium interest shall remain in the escrow account

until the residential structure in which the purchaser's separate

unit is located has been completed, and all lien periods applicable

to the purchaser's separate and undivided interests in the entire

project arising out of the work of improvement performed by either

the subdivider or any successor in interest to the subdivider have

expired or have been insured against in a manner satisfactory to the

commissioner.

   (E) Such other alternative plan as may be approved by the

commissioner.

   (b) The deeds, conveyances, leases, subleases, or instruments or

assignment to be used are adequate to transfer to the purchasers the

legal interests and uses which the owner or subdivider represents the

purchasers will receive.

   (c) After transfer of title to the first lot, apartment, or

condominium in the subdivision to any purchaser, the provisions of

the declaration of restrictions, articles of incorporation, bylaws,

management contracts (and the provisions of any and all other

documents establishing, in whole or in part, the plan for use,

enjoyment, maintenance, and preservation of the subdivision) as last

submitted to the commissioner prior to issuance of the final public

report, shall be binding upon the purchaser and occupant of every

other lot, apartment, or condominium in the subdivision, including,

except with regard to a limited-equity housing cooperative,

purchasers acquiring title by foreclosure, whether judicial or

nonjudicial, or by deed in lieu thereof, under any mortgage or deed

of trust, whether or not the mortgage or deed of trust was recorded

prior to recordation of the covenants, conditions and restrictions

applicable to the first lot, apartment, or condominium.

   (d) Reasonable arrangements have been made for delivery of control

over the subdivision and all offsite land and improvements included

in the offering, to the purchasers of lots, apartments, or

condominiums in the subdivision.

   (e) Reasonable arrangements have been or will be made as to the

interest of each of the purchasers of lots, apartments, or

condominiums in the subdivision with respect to the management,

maintenance, preservation, operation, use, right of resale, and

control of their lots, apartments, or condominiums, and such other

areas or interests, whether or not within, or pertaining to, areas

within the boundaries of the subdivision, as have been or will be

made subject to the plan of control proposed by the owner and

subdivider, and which are included in the offering.

   "Purchaser," as used in this section, shall include within its

meaning a lessee of the legal interests described in Section 11003 of

this code.

 

 

 

11018.6.  Any person offering to sell or lease any interest subject

to the requirements of subdivision (a) of Section 11018.1 in a

subdivision described in Section 11004.5 shall make a copy of each of

the following documents available for examination by a prospective

purchaser or lessee before the execution of an offer to purchase or

lease and shall give a copy thereof to each purchaser or lessee as

soon as practicable before transfer of the interest being acquired by

the purchaser or lessee:

   (a) The declaration of covenants, conditions, and restrictions for

the subdivision.

   (b) Articles of incorporation or association for the subdivision

owners association.

   (c) Bylaws for the subdivision owners association.

   (d) Any other instrument which establishes or defines the common,

mutual, and  reciprocal rights, and responsibilities of the owners or

lessees of interests in the subdivision as shareholders or members

of the subdivision owners association or otherwise.

   (e) To the extent available, the current financial information and

related statements as specified in subdivision (a) of Section 1365

of the Civil Code, for subdivisions subject to those provisions.

   (f) A statement prepared by the governing body of the association

setting forth the outstanding delinquent assessments and related

charges levied by the association against the subdivision interests

in question under authority of the governing instruments for the

subdivision and association.

 

 

 

11018.7.  (a) No amendment or modification of provisions in the

declaration of restrictions, bylaws, articles of incorporation or

other instruments controlling or otherwise affecting rights to

ownership, possession, or use of interests in subdivisions as defined

in Sections 11000.1 and 11004.5 which would materially change those

rights of an owner, either directly or as a member of an association

of owners, is valid without the prior written consent of the Real

Estate Commissioner during the period of time when the subdivider or

his or her successor in interest holds or directly controls as many

as one-fourth of the votes that may be cast to effect that change.

   (b) The commissioner shall not grant his or her consent to the

submission of the proposed change to a vote of owners or members if

he or she finds that the change if effected would create a new

condition or circumstance that would form the basis for denial of a

public report under Sections 11018 or 11018.5.

   An application for consent may be filed by any interested person

on a form prescribed by the commissioner.  A filing fee to be fixed

by regulation, but not to exceed twenty-five dollars ($25), shall

accompany each application.

   There shall be no official meeting of owners or members nor any

written solicitation of them for the purpose of effectuating a change

referred to herein except in accordance with a procedure approved by

the commissioner after the application for consent has been filed

with him or her; provided, however, that the governing body of the

owners association may meet and vote on the question of submission of

the proposed change to the commissioner.

 

 

 

11018.12.  (a) The commissioner may issue a conditional public

report for a subdivision specified in Section 11004.5 if the

requirements of subdivision (e) are met, all deficiencies and

substantive inadequacies in the documents that are required to make

an application for a final public report for the subdivision

substantially complete have been corrected, the material elements of

the setup of the offering to be made under the authority of the

conditional public report have been established, and all requirements

for the issuance of a public report set forth in the regulations of

the commissioner have been satisfied, except for one or more of the

following requirements, as applicable:

   (1) A final map has not been recorded.

   (2) A condominium plan pursuant to subdivision (e) of Section 1351

of the Civil Code has not been recorded.

   (3) A declaration of covenants, conditions, and restrictions

pursuant to Section 1353 of the Civil Code has not been recorded.

   (4) A declaration of annexation has not been recorded.

   (5) A recorded subordination of existing liens to the declaration

of covenants, conditions, and restrictions or declaration of

annexation, or escrow instructions to effect recordation prior to the

first sale, are lacking.

   (6) Filed articles of incorporation are lacking.

   (7) A current preliminary report of a licensed title insurance

company issued after filing of the final map and recording of the

declaration covering all subdivision interests to be included in the

public report has not been provided.

   (8) Other requirements the commissioner determines are likely to

be timely satisfied by the applicant, notwithstanding the fact that

the failure to meet these requirements makes the application

qualitatively incomplete.

   (b) The commissioner may issue a conditional public report for a

subdivision not referred to or specified in Section 11000.1 or

11004.5 if the requirements of subdivision (e) are met, all

deficiencies and substantive inadequacies in the documents that are

required to make an application for a final public report for the

subdivision substantially complete have been corrected, the material

elements of the setup of the offering to be made under the authority

of the conditional public report have been established, and all

requirements for issuance of a public report set forth in the

regulations of the commissioner have been satisfied, except for one

or more of the following requirements, as applicable:

   (1) A final map has not been recorded.

   (2) A declaration of covenants, conditions, and restrictions has

not been recorded.

   (3) A current preliminary report of a licensed title insurance

company issued after filing of the final map and recording of the

declaration covering all subdivision interests to be included in the

public report has not been provided.

   (4) Other requirements the commissioner determines are likely to

be timely satisfied by the applicant, notwithstanding the fact that

the failure to meet these requirements makes the application

qualitatively incomplete.

   (c) A decision by the commissioner to not issue a conditional

public report shall be noticed in writing to the applicant within

five business days and that notice shall specifically state the

reasons why the report is not being issued.

   (d) Notwithstanding the provisions of Section 11018.2, a person

may sell or lease, or offer for sale or lease, lots or parcels in a

subdivision pursuant to a conditional public report if, as a

condition of the sale or lease or offer for sale or lease, delivery

of legal title or other interest contracted for will not take place

until issuance of a public report and provided that the requirements

of subdivision (e) are met.

   (e) (1) Evidence shall be supplied that all purchase money will be

deposited in compliance with subdivision (a) of Section 11013.2 or

subdivision (a) of Section 11013.4, and in the case of a subdivision

referred to in subdivision (a) of this section, evidence shall be

given of compliance with paragraphs (1) and (2) of subdivision (a) of

Section 11018.5.

   (2) A description of the nature of the transaction shall be

supplied.

   (3) Provision shall be made for the return of the entire sum of

money paid or advanced by the purchaser if a subdivision public

report has not been issued during the term of the conditional public

report, or as extended, or the purchaser is dissatisfied with the

public report because of a change pursuant to Section 11012.

   (f) A subdivider, principal, or his or her agent shall provide a

prospective purchaser a copy of the conditional public report and a

written statement including all of the following:

   (1) Specification of the information required for issuance of a

public report.

   (2) Specification of the information required in the public report

that is not available in the conditional public report, along with a

statement of the reasons why that information is not available at

the time of issuance of the conditional public report.

   (3) A statement that no person acting as a principal or agent

shall sell or lease, or offer for sale or lease, lots or parcels in a

subdivision for which a conditional public report has been issued

except as provided in this article.

   (4) Specification of the requirements of subdivision (e).

   (g) The prospective purchaser shall sign a receipt that he or she

has received and has read the conditional public report and the

written statement provided pursuant to subdivision (f).

   (h) The term of a conditional public report shall not exceed six

months, and may be renewed for one additional term of six months if

the commissioner determines that the requirements for issuance of a

public report are likely to be satisfied during the renewal term.

   (i) The term of a conditional public report for attached

residential condominium units, as defined pursuant to Section 783 of

the Civil Code, consisting of 25 units or more as specified on the

approved tentative tract map, shall not exceed 30 months and may be

renewed for one additional term of six months if the commissioner

determines that the requirements for issuance of a public report are

likely to be satisfied during the renewal term.

 

 

 

11018.13.  (a) After written notice to the subdivider, or the

subdivider's representative, the commissioner may abandon any

application for a subdivision public report if the data required by

Section 11010 has not been furnished within three years from the date

a notice of intention is filed for a subdivision public report.

   (b) The commissioner shall adopt regulations establishing time

periods for notifying the subdivider, or the subdivider's

representative, of the intention to abandon a file, and establishing

hardship or justifiable extenuating circumstances the commissioner

deems acceptable.

 

 

 

11018.14.  The commissioner shall not be a responsible agency for

purposes of the California Environmental Quality Act (Division 13

(commencing with Section 21000), Public Resources Code).  Receipt by

the commissioner of a copy of an environmental impact report or

negative declaration prepared pursuant to the California

Environmental Quality Act shall be conclusive evidence of compliance

with that act for purposes of issuing a subdivision public report.

 

 

 

11019.  (a) Whenever the commissioner determines from available

evidence that a person has done any of the following, the

commissioner may order the person to desist and refrain from those

acts and omissions or from the further sale or lease of interests in

the subdivision until the condition has been corrected:

   (1) Has violated or caused the violation of any provision of this

part or the regulations pertaining thereto.

   (2) Has violated or caused a violation of Section 17537, 17537.1,

or 17539.1, in advertising or promoting the sale of subdivision

interests.

   (3) Has failed to fulfill representations or assurances with

respect to the subdivision or the subdivision offering upon which the

department relied in issuing a subdivision public report.

   (4) Has failed to inform the department of material changes that

have occurred in the subdivision or subdivision offering which have

caused the subdivision public report to be misleading or inaccurate

or which would have caused the department to deny a public report if

the conditions had existed at the time of issuance.

   (b) Upon receipt of such an order, the person or persons to whom

the order is directed shall immediately discontinue activities in

accordance with the terms of the order.

   (c) Any person to whom the order is directed may, within 30 days

after service thereof upon him, file with the commissioner a written

request for hearing to contest the order.  The commissioner shall

after receipt of a request for hearing assign the matter to the

Office of Administrative Hearings to conduct a hearing for findings

of fact and determinations of the issues set forth in the order.  If

the hearing is not commenced within 15 days after receipt of the

request for hearing, or on the date to which continued with the

agreement of the person requesting the hearing, or if the decision of

the commissioner is not rendered within 30 days after completion of

the hearing, the order shall be deemed to be vacated.

   (d) Service and proof of service of an order issued by the

commissioner pursuant to this section may be made in a manner and

upon such persons as prescribed for the service of summons in Article

3 (commencing with Section 415.10), Article 4 (commencing with

Section 416.10) and Article 5 (commencing with Section 417.10) of

Chapter 4 of Title 5 of Part 2, of the Code of Civil Procedure.

 

 

 

11020.  (a) It shall be unlawful for any person to make, issue,

publish, deliver, or transfer as true and genuine any public report

which is forged, altered, false, or counterfeit, knowing it to be

forged, altered, false, or counterfeit or to cause to be made or

participate in the making, issuance, delivery, transfer, or

publication of a public report with knowledge that it is forged,

altered, false, or counterfeit.

   (b) Any person who violates subdivision (a) is guilty of a public

offense punishable by a fine not exceeding ten thousand dollars

($10,000) or by imprisonment in the state prison, or in the county

jail not exceeding one year, or by both that fine and imprisonment.

   (c) The penalty provided by this section is not an exclusive

penalty, and does not affect any other penalty, relief, or remedy

provided by law.

 

 

 

11021.  For the purpose of calculating the period of any applicable

statute of limitations in any action or proceeding, either civil or

criminal involving any violation of this chapter, the cause of action

shall be deemed to have accrued not earlier than the time of

recording with the county recorder of the county in which the

property is situated of any deed, lease or contract of sale conveying

property sold or leased in violation of this chapter and which

describes a lot or parcel so wrongfully sold or leased.

   This section does not prohibit the maintenance of any such action

at any time before the recording of such instruments.

 

 

 

 

11022.  (a) It is unlawful for  an owner, subdivider, agent or

employee of a subdivision or other person, with intent directly or

indirectly to sell or lease subdivided lands or lots or parcels

therein, to authorize, use, direct, or aid in the publication,

distribution, or circularization of an advertisement, radio

broadcast, or telecast concerning subdivided lands, that contains a

statement, pictorial representation, or sketch that is false or

misleading.

   (b) An owner, subdivider, agent, or employee of an owner or

subdivider may, prior to the use, publication, distribution, or

circulation of any advertisement concerning subdivided lands, submit

the same to the department for approval.  The submission shall be

accompanied by a fee of not more than seventy-five dollars ($75).

The commissioner shall prescribe by regulation the amount of the fee.

 

   If disapproval of the proposed advertisement is not communicated

by the department to the owner, subdivider, agent, or employee within

15 calendar days after receipt of the copy of the proposed

advertisement, the advertisement shall be deemed approved, but the

department shall not be estopped from disapproving a later

distribution, circulation, or use of the same or similar advertising.

 

   (c) Nothing in this section shall be construed to hold the

publisher or employee of any newspaper, or any job printer, or any

broadcaster, or telecaster, or any magazine publisher, or any of the

employees thereof, liable for any publication herein referred to

unless the publisher, employee, or printer has actual knowledge of

the falsity thereof or has an interest either as an owner or agent in

the subdivided lands so advertised.

 

 

 

11023.  Any person who violates Section 11010, 11010.1, 11010.8,

11013.1, 11013.2, 11013.4, 11018.2, 11018.7, 11018.9, 11018.10,

11018.11, 11019, or 11022 is guilty of a public offense punishable by

a fine not exceeding ten thousand dollars ($10,000) or by

imprisonment in the state prison, or in a county jail not exceeding

one year, or by both that fine and imprisonment.