Legislative Update: Immediate Amendments to California Civil Code Sections 5850 and 5855—Association Fine Limits

On June 30, 2025, Governor Newsom signed Assembly Bill 130, resulting in immediate and significant changes to California Civil Code sections 5850 and 5855. These amendments take effect immediately (i.e, today) and seriously impact how community associations may impose fines and discipline. Boards that have pending enforcement matters should consult with their association’s legal counsel to ensure compliance with these new legal requirements.

New Fine Limitations - Civil Code Section 5850

Fine Cap: Fines imposed by an association shall not exceed the lesser of $100 per violation or the amount specified in the association’s existing schedule of monetary penalties.

Health and Safety Exception: Higher fines are allowed only for violations impacting health or safety, and only if the board makes a written finding in an open board meeting explaining the adverse impact.

No Late Charges: Associations may not impose late fees or interest on fines.

Enhanced Member Protections - Civil Code Section 5855:

Right to Cure: A member must be given an opportunity to cure a violation before any disciplinary hearing. The association cannot impose discipline on a member if the violation is remedied prior to the hearing or if the member provides “financial commitment to cure the violation” and the cure requires more time than given.

Post-Hearing Agreement: If the board and the member reach an agreement at the hearing, the board must prepare a written agreement which must be signed by both parties, and which is binding and judicially enforceable.

Internal Dispute Resolution: Members have the right to request internal dispute resolution if an agreement is not reached and/or discipline is imposed.

Notice Period Shortened: Written notice of any imposed discipline (including a fine) must be provided within 14 days (previously 15 days).

Action Items:

1.Do not impose fines greater than $100 per violation or the amounts stated in your association’s current schedule of monetary penalties, whichever is less, effective immediately, subject to certain exceptions for health and safety issues.

2.Call the association’s legal counsel to discuss whether a specific health or safety violation qualifies for higher fines pursuant to the statute and the process for imposing such fines.

3.Contact the association’s legal counsel regarding any pending enforcement action to ensure compliance with the new law.

4.To avoid confusion and risk of noncompliance, request that legal counsel update the association’s enforcement policy and schedule of monetary penalties to comply with the new law. Associations may also wish to consider amendments to CC&Rs to bolster the association’s ability to collect attorneys’ fees incurred in obtaining a member’s compliance with the governing documents via reimbursement assessments.

This new legislation (which is in effect as of July 1, 2025) significantly limits an association’s ability to enforce its governing documents. Although a $100 fine may be appropriate for some violations, in our experience larger fines are necessary to deter more significant violations. The new law also severely reduces a board’s ability to use fines and the disciplinary process to respond to claims of harassment and discrimination as required by law. As a result, we anticipate that certain types of issues will require more urgent mediation and litigation where smaller fines are ineffective. Although the new law was proposed as part of a larger bill allegedly meant to make housing more “affordable,” enforcement actions typically are more costly for associations.

This information originally appeared on the Hughes Gill website.