Question: We have a five-member board overseeing our eight-unit residential condominium building that allows rentals. I received a certified package from the board announcing the addition of more rules and regulations with more fines and penalties. Included were these sentences: "Keys to the individual units are required for an emergency. These keys must be submitted to the property manager." However, we do not have a property manager. None of our governing documents require titleholders to provide unit keys to the board. And for the 30 years I've owned my unit there's never been an "emergency" in the building.
I'm concerned about who exactly will have the keys to my unit. Since we don't have a property manager, should I assume the keys should be submitted to the board or board director? How do I know what the procedure is in order to comply with that submission? Can the board unilaterally demand that owners provide keys to our units and what about the tenants? Who will absorb the liability for these board actions?
Answer: So there is no misunderstanding, whenever there is ambiguity in instructions from the board it is appropriate to request a written clarification of exactly what the board wants from you -- especially in the case of a request fraught with legal implications. Whether there are eight or 800 units, requesting keys to individual units should be treated as a security issue and a potential risk for both the association and any titleholder who has tenants.
The entity in possession of the keys is vested with "custody-and-control" obligations. Before turning over the keys, demand a written assurance detailing who will have custody and control over them and who bears the liability. When owners merely hand over their unit keys to the board, the unspoken implication is that the owner consents to the board's use of those keys, including entry. This creates a special liability for owners whose units are tenant-occupied. The unit owner-landlord has a separate obligation to preserve the safety and security of both the tenant and the tenant's property.
The unit owner and the unit's inhabitants are entitled to advance notice of entry. Directors also must provide a lawful reason for entry that both comports with state law and the association's covenants, conditions and restrictions. Boards should know that unauthorized entries are considered an unlawful trespass.
Some associations are under the mistaken belief that hiring a property manager buffers the board from liability. However, that actually creates additional duties of overseeing management under Corporations Code 7231(a).
In general, homeowner associations should have in place security measures and procedures detailing chain of custody protocol. Property -- including records, documents and keys -- should be able to be tracked, accessed and accounted for at any given time. The board should provide written assurances of its procedures for safeguarding this information and describing what owners should do in the event of a breach. Owners have a right to know the location of their property and should be able to inspect it on request. Because association directors have a duty to inspect, manage and safeguard such property, titleholders also have a right to question central-control procedures and request related documentation. (Corporations Code sections 8330, 8333, 8334; Civil Code sections 5200, 5210).
What's more, possession of an owner's key subjects a board to "disclosure," meaning that if the management company or board disclose possession of the key to a third party, that fact must be disclosed to the unit titleholder. (Civil Code section 1798.83(e)(3)
Many of the problems that lead to litigation in these communities occur because no central control and accountability procedures appear to be in place.
The bottom line is this: Board directors have a non-delegable duty to ensure that necessary precautions are in place to protect all owner and resident-related personal information, data and keys from theft or criminal activity. This includes implementing security measures to protect the unit owners' keys from misuse.