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Occupancy Rules for Active Adult Communities, Part I.
Curtis C. Sproul is a Partner at Weintraub, Genshlea Chediak Sproul LC in Sacramento and Mary Howell is a Partner at Epsten Grinnell & Howell in San Diego. They are both contributing authors to Advising California Common Interest Communities published by CEB.
In 1983, the California Supreme Court handed down its ruling in O’Connor v Village Green Owners Association (1983) 38 Cal 3d 790, finding that owners’ associations operating in common interest developments were "business establishments" and were therefore subject to the Unruh Civil Rights Act (The Unruh Act) (CC§51-52.1). Having reached that conclusion, the Court then invalidated an "adults only" age restriction found in the Village Green development’s declaration of covenants, conditions, and restrictions.
The California legislature promptly responded in the following year by adding §51.3 to the Civil Code which sanctions certain senior housing developments, on a finding that senior citizens often need special housing arrangements, and that there was an inadequate supply of senior housing in the State of California. Several years later, in 1988, the federal Fair Housing Act (FHA) (42 USC §§3601-3613) was similarly amended to authorize housing for older persons as an exception to the Act’s general prohibition on familial status discrimination (42 USC §3607(b)(2)(ii)).
Although the California and federal laws sanctioning what are commonly known as "active adult communities" or "senior housing communities" are similar, there are some important distinctions between the two which are discussed in this article. The residency rules imposed by both statutes also present some interpretative issues when applied to particular fact situations.
Summary of Applicable Federal Fair Housing Act Provisions (42 USC §§3601-3631):
The FHA prohibits persons from discriminating in the provision of housing on the basis of race, color, religion, sex, familial status, national origin, or disability. As a general rule, federal laws often preempt state laws that seek to regulate the same subject. However, California’s Supreme Court, in the case of Schmidt v Superior Court (1989) 48 C3d 370, 373, ruled that California’s Unruh Civil Rights Act and Fair Employment and Housing Act (FEHA) (Govt C §§12900-12996) continued to have vitality to the extent those laws did not contradict federal law.
As noted above, the Fair Housing Amendments Act of 1988 carved out an exception from the rule prohibiting discrimination in the provision of housing for developments that are specifically designed as housing for older persons (42 USC §3607(b)(2)(ii)). The most common federally sanctioned housing for older persons developments are those that are designed and marketed as housing for persons 55 years of age or older. To meet the federal requirements for that category of exemption, the community must be able to demonstrate that:
(i) at least 80 percent of the occupied units house at least one person who is 55 years of age or older;
(ii) the community publishes and adheres to policies and procedures that show an intent to maintain the development as one that is intended as housing for persons 55 years of age or older; and
(iii) the community has implemented a means of verifying the ages of residents through reliable surveys and affidavits, so that such verification data can be produced in response to a complaint filed under the federal law.
Summary of California Senior Housing Laws
As noted above, California has two bodies of statutory law that regulate and permit senior housing, namely the Fair Employment and Housing Act (FEHA) (Govt C §12900-12996) and the Unruh Civil Rights Act (CC §§51- 52.1). Like the federal Fair Housing Act, the FEHA prohibits discrimination in the provision of housing on the basis of familial status, but carves out an exception for several categories of senior housing, the most common being housing that meets the standards for senior housing under the Unruh Act. (In particular, see CC§§51.2-51.4 of that Act). The Unruh Act is more liberal than the analogous federal laws in that the Act permits certain other persons who are less than 55 years of age to occupy a residence in a senior housing development. It is with respect to those "under age 55" exceptions in the California law that most of the interpretative problems arise.
The under age 55 exceptions in the Unruh Act
The opening proposition with respect to the laws governing active adult communities under California law is that homes within the development must first be occupied by at least one person who is a "Qualifying Resident" - a term that is defined in CC §51.3 as a person who is 55 years of age or older. Once the requirement is met, other individuals of a younger age can also reside in the home if they meet the definition of either a "Qualifying Permanent Resident" or a "Permitted Health Care Resident", or they are merely guests occupying the residence for not more than 60 days a year.
Qualified permanent residents
The most common category of "Qualified Permanent Resident" is a person under the age of 55 years who is married to an individual who is 55 years of age or older. Other persons who come within the definition of a Qualified Permanent Resident include: (i) a "co-habitant" (of any age) of a Qualifying Resident, (ii) a person of any age who provides primary physical or economic support of the over-54 resident, (iii) an under-age 55 disabled child or a grandchild of either a Qualifying Resident or a Qualified Permanent Resident who needs to live with the Qualifying Resident or with a Qualified Permanent Resident because of the disabling condition, illness or injury, and (iv) any other person who is 45 years of age or older, so long as that person begins his or her occupancy as co-habitant with a Qualifying Resident. The Unruh Act contains provisions that can result in a Qualified Permanent Resident having to vacate a residence if the person’s status results from a disabling condition and the condition ends, or if the Qualified Permanent Resident is likely to pose a significant threat to the health or safety of others that cannot be ameliorated by a reasonable accommodation. (CC §51.3(b)(3)(A) & (B)).
Permitted health care residents
If a person is hired to provide live-in, long-term or terminal health care to a Qualifying Resident, or is a family member of the Qualifying Resident (i.e., no need to be "hired"), that person is classified as a "Permitted Health Care Resident". The care must be substantial in nature and include providing assistance with necessary daily activities or medical treatment, or both. (CC §51.3(b)(7)).
Guests of other permitted residents
The covenants, conditions and restrictions (CC&Rs) for a senior housing community or other documents or written policy must permit temporary residency, as a guest of either a Qualifying Resident or a Qualified Permanent Resident of under aged guests for occupancy periods of not less than 60 days a year. NOTE, that the statute says "not less", rather than "not more". Accordingly, the CC&Rs or other written policy could provide for guest residency periods in excess of 60 days, although most senior housing CC&Rs adhere to a 60-day limit.
Continued occupancy in the absence of a resident senior
Both types of Qualified Permanent Residents are entitled to continue to reside in the senior community after the death, dissolution of marriage, hospitalization, or other prolonged absence of the senior. (CC§51.3(e)). That privilege is not extended to Permitted Health Care Residents, although such persons can continue to reside in the development in the absence of the senior resident if the senior is absent due to hospitalization or other medical treatment and is expected to return within 90 days and a written request for continued residence of the health care provider is presented to the governing board of the development on behalf of the senior. (CC §51.3(b)(7)).
(To be continued in the next issue of Case n’ Point)
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Common Interest Communities
Approx. 1050 pages, two looseleaf volumes, 2003, RE33430, $219.00