Effective January 1, 2014, commercial and industrial CIDs ceased to be part of the Davis-Stirling Act. They were moved under a new Commercial and Industrial Common Interest Development Act ("Commercial CID Act").

Delivering Documents to the Association. The OS Act and Commercial CID Act have near identical provisions for delivering documents to their associations. C-I CIDs need not prepare annual policy statements required by D-S associations.

Individual Delivery and Notice to Members. Both the new D-SAct and C-I CID Act adopted similar provisions for "individual delivery" and "individual notice" to members, respectively. Both' acts provide for individual delivery of documents or individual notices. For the purposes of the Commercial CID Act, "individual delivery" and "individual notice" reference only a few specific types of documents or notice: (i) Delivery of (1) a copy of all amendments to the governing documents to remove only certain developer language and (2) the related notice of the meeting to consider same; (ii) Delivery of a proposed amendment to the CC&Rs to the membership; (iii) Delivery of notices to the owner regarding the temporary, summary removal of occupants for termite treatment, and (iv) Distribution of a schedule of monetary penalties.

Secondary Address. The Commercial CID Act discontinued the requirements of former regarding secondary addresses for members.

Time of Delivery. Both the new Davis-Stirling and the Commercial CID Act adopted identical new provisions defining when a document is deemed delivered: (i) delivery by mail is deemed to be completed on deposit into the United States mail; and (ii) electronic delivery is complete at the time of transmission. Regrettably, neither act addresses when delivery by overnight delivery by an express service carrier is completed. The best answer for that is upon actual delivery to the address of the recipient.

Electronic Delivery. Both the new Davis-Stirling and the Commercial CID Act also adopted new provisions comparable to certain portions of Corporations Code § 20 and § 21 regarding conditions of electronic delivery.

Right to Attorney's Fees. The Commercial CID Act discontinued the right of prevailing parties recovering attorney's fees and costs in actions for the enforcement of governing documents.

Petition to Amend CC&Rs. The Commercial CID Act does not allow the association the right to petition the court to allow a majority vote to be sufficient when a supermajority is required by the CC&Rs.

Rental Prohibitions. Rental prohibitions in commercial and industrial CIDs may be applied to all owners at the time of adoption.

Budgets and Financial Disclosures. Commercial and industrial CIDs have no obligation to prepare a budget or make financial or real estate disclosures as required by the OS Act.

Reserves. Commercial and industrial CIDs are not required to perform reserve studies.

Parliamentary Procedures. The Commercial CID Act discontinued the requirement of conducting meetings under a parliamentary procedures.

Parliamentary Procedures. The Commercial CID Act discontinued the requirement of conducting meetings under a parliamentary procedures.

Access to Records. The statutes allowing membership access to records and providing record keeping requirements no longer apply to commercial and industrial CIDs. Record access is once again limited to Corporations Code § 8330, et seq. and the association's governing documents.

Fines and Discipline. The statutory fine and discipline procedure has been jettisoned. This does not suggest that commercial CIDs may disregard due process entirely. It only means that any reasonable procedure giving notice and an opportunity to be heard may be adopted in your governing documents and implemented.

Election Rules. The election procedures statute and its companion on campaign funding were not continued in the Commercial CID Act.

Open Meeting Act. Another casualty of the Commercial CID Act is the Open Meeting Act. The provision of Civil Code § 1363.05 are not part of the Commercial CI D Act. However, an open meeting is still required for the consideration and deliberation by the board to adopt and amendment to remove certain developer language from the governing documents. Members are entitled to make comments at such meeting. Otherwise, commercial and industrial CIDs, among other things:

• Are subject to Corporations Code § 7211 and their governing documents for board meetings.
• Need not give notice of regular or special board meetings to its membership.
• Need not distribute board meeting agendas to its membership.
• Need not allow its members to attend board meetings.
• May consider any matters in executive session (assuming it allowed an open meeting to start).
• May again take actions by written consent as allowed by Corporations Code § 7211 (b).

Transfer of Common Area to a Member. The requirement of former Civil Code § 1363.07 requiring member consent to transfer common area to a member for his or her exclusive use no longer applies to commercial or industrial CIDs.

Managing Agent Disclosures and Duties. The disclosure requirements and duties of managing agents provided for in former Civil Code § 1363.1 ani! § 1363.2 were discontinued in the Commercial CID Act.

Insurance Requirements. The requirements and protections of former Civil Code § 1365.7 as to directors and officers insurance no longer apply to commercial and industrial CIDs. Regardless, directors and officers insurance coverage is highly recommended for any CID board.

Assessments. Prior to the Commercial CID Act, the only difference between residential and commercial CIDs regarding assessments was that commercial CIDs were not bound by former Civil Code § 1366(b) which (1) limited the amount of annual increases to regular assessments, (2) limited the amount an association could impose for a special assessment and (3) restricted the circumstances under which an emergency assessment could be imposed. The Commercial CID Act continues as before in that regard, but eliminates the requirements of Civil Code § 1366(d),(e)&(f) as well. Subject to a commercial or industrial association's governing documents:

• It no longer must give notice of an assessment increase between 30 and 60 days before it becomes due. Now a shorter or longer period would be acceptable.
• The 15 day minimum before assessments are in default no longer applies. Assessments may be in default after a shorter period.
• The 10% or $10 limit on late fees no longer applies. Larger late fees may be imposed.
• The delay of 30 days before interest accrues on delinquent assessments no longer applies. Interest may now commence immediately upon delinquency.
• The Constitutional exemption allowing them to charge 12% interest on delinquent accounts no longer applies. Commercial and industrial CIDs are now limited to collecting no more than 10% interest on unpaid assessments.

Excessive Fees. Former Civil Code § 1366.1, which prohibits residential associations imposing or collecting an assessment or fee that exceeds the amount necessary to defray the costs for which it is levied, continues to be inapplicable to commercial and industrial associations under the Commercial CID Act.

Recording Management Information. The recording rights of former Civil Code § 1366.2 were discontinued under the Commercial CID Act.

Basing Assessments on Taxable Value. The prohibitions of former Civil Code § 1366.4 to basing assessments on taxable values are not part of the Commercial CID Act.

Lien Procedures. Prior to the Commercial CID Act, lien procedures between the residential and commercial CIDs were identical. But now, the Commercial CID Act changes it to the following:

• The Commercial CID Act lien provisions apply only to liens created on or after January 1, 2014. Liens created before then follow the law that existed at the time of their creation. (Civ. Code § 6828.) The consequence is that commercial and industrial CIDs now have four different bodies of law for liens depending on when they were created:

Before January 1, 1986 (such statutory and case law that might have existed then). January 1, 1986 through December 31,2002 (former Civ. Code § 1367). January 1, 2003 through December 31,2013 (former Civ. Code § 1367.1). January 1, 2014 until the next change) (Commercial CI D Act).

Pre-lien letters no long need to include the former requirements of Civil Code § 1367.1 (a)(4)-(6) stating that a member has the right to request a meeting with the board to discuss payments plans, request IDR, request ADR,

Commercial and industrial CIDs are no longer required to apply payments to assessments first as previously required by former Civil Code § 1367.1(b).

• Commercial and industrial CIDs need no longer participate in IDR, ADR or discuss payment plans as previously required by former Civil Code § 1367.1 (c).
• The foreclosure restrictions offormer Civil Code § 1367.4 (requiring an assessment to be delinquent for 12 months or in an amount of $1 ,800 or more) no longer apply to commercial or industrial CIDs.
• If it is determined that a commercial or industrial CID has recorded a lien for a delinquent assessment in error, it is no longer required to reverse all late charges, fees, interest, attorney's fees, costs of collection, costs imposed as previously provided for in former Civil Code § 1367.5. It need only record a lien release or notice of rescission and provide the owner of the separate interest with a declaration that the lien filing or recording was in error and a copy of the lien release or notice of rescission. (Civ. Code § 6818.) But, an association that fails to comply with proper lien procedures shall, prior to recording a lien, recommence the required notice process. Any costs associated with recommencing the notice process shall be borne by the association and not by the owner of a separate interest. (Civ. Code § 6819.)  So, the association need not reverse prior charges, but cannot charge the member again for the same pre-lien costs.
• Members may no long pay assessments to commercial or industrial CIDs under protest as previously allowed under Civil Code § 1367.6.

Real Estate Disclosures. Disclosures to prospective purchasers do not apply to commercial or industrial CIDs. In addition, the related form disclosing charges for such disclosures was discontinued in the Commercial CID Act.

lDR and ADR. The lDR and ADR requirements have been discontinued in their entirety in the Commercial CID Act.