HomeMy WebLinkAboutContracts & Agreements_6-2008_CCv0001.pdf RECORDING REQUESTED BY:
MUNICIPAL UTILITIES&
ENGINEERING DEPARTMENT Recorded In Official Records, County of San Bernardino 3(06/2008
CITY OF REDLANDS 10:38 AM
LARRY WALKER DTH
Auditor/Controller — Recorder
4
629 Chicago Title Company
WHEN RECORDED RETURN TO: Qoc#: 2qq$—q1 gg2$fi
CITY CLERK'S OFFICE Tiles: 1 Pages: 18
CITY OF REDLANDS Fees 116.00
P.O.BOX 3005 Ta0.00
11
REDLANDS,, CA 92373 Other -0.00 11111111111111111111111 $116.00
(THIS SPACE FOR RECORDER'S USE ONLY)
CITY OF REDLANDS
SUBDIVISION IMPROVEMENT AGREEMENT
THIS AGREEMENT is made thislstiiay of January . 20QL by and between the City
ofRedlands,a municipal corporation,hereinafter referred to as"City,"and Franklin Court,a General
Partnership, hereinafter referred to as "Subdivider."
RECITALS
WHEREAS, Subdivider is the owner or authorized developer of property located in the City
of Redlands known as Tract No. 13649 (the"Subdivision"), for which Subdivider is obligated to
construct certain improvements(the"Improvements")as a condition of approval of the Subdivision;
and
ArB REAS, City desires to ensure that the Improvements will be constructed in a good and
workmanlike manner and in accordance with the laws of the City; and
WHEREAS, Subdivider acknowledges that it is familiar with the provisions of the Redlands
Municipal Code and the State Subdivision Map Act(Government Code sections 66410 et seq.)and
agrees to comply therewith; and
WHEREAS, a final map for the Subdivision has been prepared pursuant to the Redlands
Municipal Code and the State Subdivision Map Act, and has been filed by Subdivider for
consideration by the City Council of City;
Sub.Improve.Agrmt./October 2007
d. Commence construction of the Improvements by the time established in Section 25
of the agreement and complete the Improvements by the deadline stated in Paragraph 3.a. above,
unless a time extension is granted by the City as authorized in Section 25.
e. Install all subdivision public Improvement monuments required by law prior to formal
final acceptance of the public Improvements by the City. Individual property monuments shall be
installed within one year of said acceptance.
f. Install street name signs conforming to City standards. Permanent street name signs
shall be installed before acceptance of the Improvements by the City.
4. Acguiion and Dedication of Property. If any of the public Improvement and land
use development work contemplated by this Agreement is to be constructed or installed on land not
owned by City or Subdivider,no construction or installation shall be commenced before:
a. The offer of dedication to City of appropriate rights-of-way, easements or other
interests in real property, and appropriate authorization from property owner to allow construction
or installation of the Improvements or work, or
b. The dedication to,and acceptance by,the City of appropriate rights-of-way easements
or other interests in real property, as determined by the City Engineer, or
C. The issuance by a court of competent jurisdiction pursuant to the State Eminent
Domain Law of an order of possession. Subdivider shall comply in all respects with the order of
possession.
Nothing in this Section shall be construed as authorizing or granting an extension of time to the
Subdivider.
5. Security. Subdivider shall at all times guarantee Subdivider's performance by
furnishing to City and maintaining good and sufficient security as required by the Subdivision laws
in accordance with Sections 66499 through 66499.10 of the Government Code,on forms approved
by City for the purposes and in the amounts as follows:
a. To assure faithful performance of the Agreement in regard to said Improvements in
an amount of 100%of the estimated cost of the improvements; and
b. To secure payment to any contractor, subcontractor, person renting equipment, or
furnishing labor and materials for the Improvements required to be constructed and installed
pursuant to this Agreement,Subdivider shall provide City with a bond in the amount of 100%of the
estimated cost of the Irnprovements; and
S u b,I mprove.Agrmt,/October-100711 3
inspected and completed in accordance with the Improvement plans. When applicable law requires
an inspection to be made by the City at a particular stage of the work of constructing and installing
such Improvements, City shall be given timely notice of Subdivider's readiness for such inspection
and Subdivider shall not proceed with additional work until the inspection has been made and the
work approved. Subdivider shall bear all costs of inspection and certification. Nio improvements
shall be deemed completed until acceptance by the City Council pursuant to Section 18 herein.
8. Release of Securities. The securities required by this Agreement shall be released as
follows:
a. Security given for faithful performance of any act,obligation,work or agreement shall
be released upon the final completion and acceptance of the act or work, subject to the provisions
Of Subsection (b) hereof.
b. The City Engineer may release a portion ofthe security given for faithful performance
of Improvement work as the Improvement progresses upon application thereof by the Subdivider;
provided, however, that no such release shall be for an amount less than 25% of the total
Improvement security given for faithful performance of the Improvement work and that the security
shall not be reduced to an amount less than 50% of the total Improvement given for faithful
performance until final completion and acceptance of the public Improvements. In no event shall
the City Engineer authorize a release of the Improvement security which would reduce the security
to an amount below 125% of that required to guarantee completion for the Improvement work and
any other obligation imposed by this Agreement.
C. Security given to secure payment to the contractor, subcontractors and to persons
furnishing labor, materials or equipment shall,at six(6)months after the completion and acceptance
of the work,be reduced to an amount equal to no less than 125%of the total claimed by all claimants
for wlion-i liens have been filed and of which notice has been given to the City, plus an amount
reasonably determined by the City Engineer to be required to assure the performance of any other
obl],,at ions secured by the security. The balance of the security shall be released upon the settlement
of all claims and obligations for which the security was given.
d. No security given for the guarantee or warranty for work shall be released until the
expiration of the warranty period and until any claims filed during the warranty period have been
settled. As provided in Paragraph 12,the warranty period shall not commence until final acceptance
of a]I the work, and Improvements by the City Council.
C. The City may retain from any security released,an amount to sufficiently cover costs
and reasonable expenses and fees, including reasonable attorneys' fees.
9. Injury to Improvements. Public Pro l2erty,or Public Utilities Facilities.
Sub,!�i e Aut 20617 5
of default by Subdivider. The right of the City to draw upon or utilize the security is additional to
and not in lieu of any other remedy available to City. It is specifically recognized that the estimated
costs and security amounts may not reflect the actual cost of construction or installation of the
Improvements and,therefore,City's damages for Subdivider's default shall be measured by the cost
of completing the required Improvements. The sums provided by the Improvements security may
be used by City for the completion of the public Improvements in accordance with the Improvement
plans and specifications contained herein.
In the event of Subdivider's default under this Agreement, Subdivider authorizes City to
perform such obligation twenty(20)days after mailing written notice of default to Subdivider and
Subdivider's surety, and agrees to pay the entire cost of such performance by City.
City may take over the work and prosecute the same to completion, by contract or by any
other method City may deem advisable, for the account and at the expense of Subdivider, and
Subdivider's surety shall be liable to City for any excess cost of damages occasioned City thereby.
In such event,City,without liability for so doing,may take possession of,and utilize in completing
the work, such materials, appliances,plants and other property belonging to Subdivider as may be
on the site of the work and necessary for performance of the work.
C. Failure of Subdivider to comply with the terms of this Agreement shall constitute
consent to the filing by the City of a notice of violation against all the lots in the Subdivision, or to
rescind the approval or otherwise revert the Subdivision to acreage. The remedy provided by this
subsection is in addition to, and not in lieu of, other remedies available to City. Subdivider agrees
that the choice of remedy or remedies for Subdivider's breach shall be in the discretion of City.
d. In the event that Subdivider fails to perform any obligation hereunder, Subdivider
agrees to pay all costs and expenses incurred by City in securing performance of such obligations,
including but not limited to fees and charges of architects,engineers, attorneys other professionals
and court costs.
e. The failure of City to take enforcement action with respect to a default,or to declare
a breach, shall not be construed as a waiver of that default or breach or any subsequent default or
breach of Subdivider.
12. Warranty. Subdivider shall guarantee or warranty the work done pursuant to this
Agreement for a period of one(1)year after final formal acceptance of this subdivision by the City
Council against any defective work or labor done or defective materials famished. If within the
warranty period any work or Improvement or part of any work or Improvement done, furnished,
installed or constructed by Subdivider fails to fulfill any of the requirements of this Agreement or
the Improvement plans or specifications referred to herein, Subdivider shall without delay and
without cost to the City repair or replace or reconstruct any defective or otherwise unsatisfactory part
or parts of the work or structure. Should Subdivider fail to act promptly in accordance with this
requirement, Subdivider hereby authorizes City, at City's option to perform the work twenty(20)
Sub.Improve.. grmt.,,October 2007 7
16. Subdivider's Obligation to Warn Public During;Construction. Until final acceptance
of the improvements, Subdivider shall give good and adequate warning to the public of each and
every dangerous condition existent in said improvements,and will take reasonable actions to protect
the public from such dangerous condition.
17. Vesting of Ownership. Upon formal final acceptance of the work, by City and
recordation of the Final Map,ownership of the improvements constructed pursuant to this agreement
shall vest in City.
18. Final Acceptance of Work. Acceptance of work on behalf of City shall be made by
the Public Works Director upon recommendation of the City Engineer after final completion and
inspection of all improvements. The Public Works Director shall act upon the Engineer's
recommendation within sixty(60)days from the date the City Engineer certifies that the work has
been finally completed, as provided in Section 7. Such acceptance shall not constitute a waiver of
defects by City.
19. Compliance with Laws. Subdivider and its agents, employees, contractors and
subcontractors shall comply with all applicable Federal, State and local rules, laws and regulations
in the performance of the improvements and land development pursuant to this agreement including
but not limited to all applicable Labor Code and prevailing wage laws.
20. Insurance.
a. Subdivider's Insurance to be Primary
All insurance required by this Agreement is to be maintained by Subdivider for the duration
of this Agreement and shall be primary with respect to City and non-contributing to any insurance
or self-insurance maintained by City. Subdivider shall provide City with Certificates of Insurance
evidencing such insurance within fifteen(15) days of execution of this Agreement.
b. Worker's Compensation and Employer's Liability.
1. Subdivider shall have Worker's Compensation and Employer's Liability
insurance in force throughout the duration of the Agreement in an amount which meets the statutory .
requirement with an insurance carrier acceptable to City. Such insurance shall be primary and non-
contributing to any insurance or self-insurance maintained by City. City shall be named as an
additional insured and the insurance policy shall include a provision prohibiting cancellation of said
policy except upon thirty(30) days prior written notice to City. Certificates of Insurance shall be
delivered to City within fifteen (15)days of execution of Agreement.
2, Subdivider expressly waives all rights to subrogation against the City, its
officers, employees and volunteers for losses arising from work performed by Subdivider for City
by expressly waivingSubdivider's immunity for injuries to Subdivider's employees and agrees that
Sub.isnprove.Agrent.rgJctobe:t°240"
9
tiry
�s
taken by the City in approving the plans or map, unless the particular improvement design was
specifically required by City over written objection by Subdivider submitted to the City Engineer
before approval of the particular improvement design,which objection indicated that the particular
improvement design was dangerous or defective and suggested an alternative safe and feasible
design.
After acceptance ofthe Improvements,the Subdivider shall remain obligated to eliminate any
defect in design or dangerous condition caused by the design or construction defect; however,
Subdivider shall not be responsible for routine maintenance. The provisions of this paragraph shall
remain in full force and effect for ten (10) years following the acceptance by the City of the
Improvements. It is the intent of this section that Subdivider shall be responsible for all liability for
design and construction ofthe Improvements installed or work done pursuant to this Agreement and
that City shall not be liable for any negligence, nonfeasance, misfeasance or malfeasance in
approving,reviewing,checking,or inspecting any work or construction. The Improvement security
shall not be required to cover the provisions of this paragraph.
Subdivider shall reimburse the City for all costs and expenses(including but not limited to
fees and charges of architects,engineers,attorneys and other professionals,and court costs)incurred
by City in enforcing the provisions of this section.
22. Personal Nature of Subdivider's Obligations. All of Subdivider's obligations under
this Agreement are and shall remain the personal obligations of Subdivider notwithstanding a
transfer of all or any part of the property within the Subdivision subject to this Agreement, and
Subdivider shall not be entitled to assign its obligations under this Agreement to any transferee of
all or any part of the property within the Subdivision or any other third party without the express
written consent of the City.
23. Sale or Disposition of Subdivision. Seller or other Subdivider may request a novation
of this Agreement and a substitution of security. Upon approval of the novation and substitution of
securities, the Subdivider may request a release or reduction of the securities required by this
Agreement. Nothing in the novation shall relieve the Subdivider of the obligations under Section
22 for the work or Improvement done by Subdivider.
24. Time is ofthe Essence. Time is ofthe essence in the performance of this Agreement.
25. Time for Commencement of Work, Time Extensions. Subdivider shall commence
substantial construction of the Improvements required by this Agreement not later than three (3)
months after the date of this Agreement. In the event good cause exists as determined by the City
Engineer,the time for commencement ofconstruction or completion ofthe Improvements hereunder
may be extended for a period or periods not exceeding a total of two additional years. The extension
shall be executed in writing by the City Engineer. Any such extension may be granted without notice
to Subdivider's surety and shall not affect the validity of this Agreement or release the surety or
sureties on any security given for this Agreement. The City Engineer shall be the sole and final
Sub.1niprove.Agrmt/October 2001-1 11
Notice to Surety: V Centennial Bank
101 E. Redlands Blvd., Suite 106
Redlands, Ca 92373
29. —Severability. The provisions of this Agreement are severable. In any portion of this
Agreement is held invalid by a court of competent jurisdiction,the remainder of the Agreement shall
remain in full force and effect unless amended or modified by mutual written consent of the parties.
30. Captions. The captions ofthis Agreement are for convenience and reference only and
shall not define, explain, modify, limit, exemplify, or aid in the interpretation, construction or
meaning of any provisions of this Agreement.
31. Litigation. In the event that suit is brought to enforce the terms of this Agreement,
the prevailing party shall be entitled to litigation costs and reasonable attorney's fees.
32. IncoMoration of Recitals. The recitals to this agreement are hereby incorporated into
the terms of this Agreement.
33. Entire Agreement. This agreement constitutes the entire Agreement of the parties
with respect to the subject matter. All modifications, amendments, or waivers of the terms of this
Agreement must be in writing and signed by the appropriate representatives of the parties.
34, Interpretation. This Agreement shall be interpreted in accordance with the laws of
the State of California.
35. Jurisdiction. Jurisdiction of all disputes over the terms of this Agreement shall be in
the County of San Bernardino, State of California.
IN WITNESS WHEREOF this agreement is executed by the Parties as of the date herein
above first written.
Sub,Improve,Agrmt./October 2007 13
ALL-PURPOSE ACKNOXVLEDGM ENT
STATE OF CALIFORNIA
COUNTY OF SAN BERNARDINO Ss
CITY OF REDLANDS
By the authority granted under Chapter 4, Article 3, Section 1181, of the California Civil Code, and Chapter
2, Division 3, Section 40814, of the California Government Code, on January 16, 2008, before me, Teresa
Ballinger., Assistant City Clerk, on behalf of Lorrie Poyzer, City Clerk of the City of Redlands.. California,
personally appeared N. Enrique Martinez, City Manager and Lorrie Poyzer, City Clerk who proved to me on
the basis of satisfactory evidence to be the person(s) whose names) is/are subscribed to the within
instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized
capacity(les) and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf
of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing
paragraph is true and correct.
WITNESS my hand and official sea].
LORRIE POWER. CITY CLERK
119W
Teresa Ballinger, Assistant City 3 derk
(909)798-7531
CAPACITY CLAIMED BN'SIGNER(S)
Individual(s)signing for oneself/themselves
Corporate Officer(s)
Title(s)
Company
Partner(s)
Partnership
Attorney-In-Fact
Principal(s)
Trustee(s)
Trust
x Other
Title(s): City Manager and City Clerk
Entity Represented: City of Redlands, a municipal corporation
-----------------—--I---------—I-----------
THIS CERTIFICATE MUST.BE ATTACHEDToTIME DOCUMENT DESCRIBED BELOW:
Title or Type of Document: Subdivision Improvement Agreement(Tract Map No. 13649).
Date of Document: January 15., 2008
Signer(s) Other Than Named Above: Franklin Court, a General Partnership, by: Brian 1'. King, Managing
General Partner
CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT
s�..P*^c`„� r!',£"`'"_..���*�..�i �`�''"`�%T�`�c`3�ti'�'n. ,,£�'r�7^K'�,�5,:`=���'��'F'i-vC,�•f`.,.'.�'a'� "h�`':�L��,.st ��". .- - _. .—. -..�.`u�—'''.ciY� .
State of California
County of t, i tt cl 11
4n before me, }
Date ..- p Here Insert Name and rdle of the officer
personally appeared }
Name{}of Signer{s}
r
who proved to me on the basis of satisfactory evidence to
be the person(e) whose namefe) is/afee subscribed to the
within instrument and acknowledged to me that
he/s4el executed the same in his/he#their authorized
capaeity(ier}, and that by his/heritheir signature(s) on the
M• instrument the person(s), or the entity upon behalf of
1691 which the person(s)-acted, executed the instrument.
Sm sol,
MpCowrm aC t�f f certify under PENALTY OF PERJURY under the laws
of the State of California that the foregoing paragraph is
true and correct.
WITNESS my hand and official seal.;'
Signature Z `, ? 2
Place Notary Seal Above ignature of Notary Public
OPTIONA
Though the information below is not required by law, it may prove valuable to persons relying on the document
and could prevent fraudulent removal and reattachment of this form to another document.
Description of Attached Document
Title or Type of Document:—s;,,,_ i Zf'
Document Date: Number of Pages:_
Signer(s)Other Than Named Above:
Capacity(ies) Claimed by Signer(s)
Signer's Name: Signer's Name
[,7 Individual E] Individual
i_] Corporate Officer—Title(s): 1_11 Corporate Officer—Title(s): _
� artner-D Limited C;:]General O Partner--[01 Limited C�`l General �,.
E Attorney in Pact • ` O Attorney in Fact "
Top of thumb here Top of thumb here
-1 Trustee ,-�J Trustee
Guardian or Conservator i_J Guardian or Conservator
7 Other: ,Other:
Signer Is epres��nting: _ Signer is Representing:-..
02007 National Notary Assaaa9on-9354 fJe Solo Ave,PO,Pox 2402-Chatsworth,CA 910313-2402-www.NatlonaiNataryorg Item#5907 Reorder:Call'loll-Free 1-800-876-6827
CITY OF REDLANDS
SUBDIVISION IMPROVEMENT AGREEMENT
EXHIBIT"A"
TRACT MAP NO. 13649
Doscriytion Drawing No. Approval Date No. of Sheets
The following plans are on file in the office of the Public Works Director (PWD) and Municipal
Utilities Director(MUD)
Street Improvement Plans (PWD) 1956- T 10/17107 02
Water Improvement Plans(MUD) D-60645 10/02/07 01
Sewer hnrovement Plans (MUD) F-1770 10/02/07 03
Sub.I pro ve.A rm/October 2007 15
File# � ���} � 1 0
.gyp State of California _� 0 S�
.,a-- Document#
Secretary of State
°�i rrot<w�
ENDOR ED - FILED
in the office 011,,*
fthe frIof>ttati0#11411Ie
STATEMENT OF PARTNERSHIP AUTHORITY of the state of Cslifo"ryn
AUG 2 9 2007
A$70.00 filing fee must accompany this form. -- --
IMPORTANT-Read instructions before completing this form. This Space For Filing Use Only
PARTNERSHIP NAME
1. NAME OF PARTNERSHIPJ---
Franklin Court Partnership
OFFICE ADDRESSES (Do notabbreviate-ttve-city. Items 2 and 3 cannot be P.O.Boxes.)
2. STREET ADDRESS OF CHIEF EXECUTIVE OFFICE CITY AND STATE ZIP CODE
1632 Garden Street Redlands, CA 92373
3. STREET ADDRESS OF CALIFORNIA OFFICE,IF ANY CITY STATE ZIP CODE
CA
NAMES & ADDRESSES OF PARTNERS (Complete Item 4 with the names and mailing addresses of all the partners (attach additional pages if
necessary)OR leave Item 4 blank and proceed to Item 5. Any attachments to this document are incorporated herein by this reference.)
4. NAME ADDRESS CITY AND STATE ZIP CODE
Brian T. King 1033 E. Palm Avenue Redlands, CA 92374
NAME ADDRESS CITY AND STATE ZIP CODE
Kenneth R. King 17888 Sintonte San Diego, CA 92128
NAME ADDRESS CITY AND STATE ZIP CODE
New Heights Construction, Inc. 1632 Garden Street hedlands, CA 92373
APPOINTED AGENT (if Item 4 was not completed, complete Item 5 with the name and mailing address of an agent appointed and maintained by the
partnership who will maintain a list of the names and mailing addresses of all the partners.If Item 4 was completed,leave Item 5 blank and proceed to Item 6.)
5, NAME ADDRESS CITY AND STATE ZIP CODE
AUTHORIZED PARTNERS (Enter the name(s) of ail the partners authorized to execute instruments transferring real property held in the name of the
partnership.Attach additional pages if necessary. Any attachments to this document are incorporated herein by this reference.)
6. PARTNER NAME: Brian T. King PARTNER NAME:
PARTNER NAME: Jack Nydam, New Heights Construction Inc. PARTNER NAME:
f9fes;ck i,,,.T'
PARTNER NAME: PARTNER NAME:
ADDITIONAL INFORMATION
7, ADDITIONAL INFORMATION SET FORTH ON THE ATTACHED PAGES, IF ANY, IS INCORPORATED HEREIN BY THIS REFERENCE AND MADE PART OF
THIS DOCUMENT.
EXECUTION (If additional signature space is necessary,the dated signature(s)with verification(s)may be made on an attachment to this document. Any
attachments to this document are incorporated herein by this reference.)
6. 1 CERTIFY UNDER PENALTY OF PERJURY UNDER THE LAWS OF THE STATE OF CALIFORNIA THAT THE FOREGOI--NG I - RECT OF MY
OWN KNOWLEDGE.
V —6r l�
SIGNATURE OF PARTNER—b— "
DATE TYPE OR PRINT NAME OF PARTN R
r �
Cizr-o i — '� 21 4 Y,F--,.
SIGN URE OF PARTN DATE TYPE OR PRINT NAME OF PARTN —rtvc
GP-1(REV 11/2006) �/ APPROVED BY SECRETARY OF STATE
M�
RECORDING REQUESTED BY:
Franklin Court Partnership
WHEN RECORDED MAIL TO:
Franklin Court Partnership
1632 Garden Street Ole
Redlands, CA 92373 66
DECLARATION FOR PLANNED DEVELOPMENT
TABLE OF CONTENTS
RECITALS.
ARTICLE 1. DEFINITIONS.
Section 1.01. Articles.
Section 1.02. Association.
Section 1.03. Beard.
Section 1.04. Bylaws.
Section 1.05. Common Area.
Section 1.06. Declarant.
Section 1.07. Declaration.
Section 1.08. Development.
Section 1.09. Exclusive Use Common Area.
Section 1.10. Governing Instruments.
Section 1.11. Lot.
Section 1.1 Z. Manager.
Section 1.13. Member.
Section 1.14. Mortgage and First Mortgage.
Section 1.15. Mortgagee, Institutional Mortgagee and First Mortgagee.
Section 1.16. Mortgagor.
Section 1.17. Owner.
Section 1.18. Person.
Section 1.19. Property.
Section 1.20. Rules and Regulations.
Section 1.21. Subdivision Map
i
ARTICLE VI. ARCHITECTURAL, AND DESIGN CONTROL.
Section 6.01. Architectural and Design Approval.
Section 6.02. Architectural Control Committee.
Section 6.03. The Board of Directors.
ARTICLE VII. INSURANCE.
Section 7.01. Fire and Casualty Insurance.
Section 7.02. General Liability and Individual Liability Insurance.
Section 7.03. Other Association Insurance.
Section 7.04. Trustee for Policies.
Section 7.05. Individual Insurance.
Section 7.06. Insurance Premiums.
ARTICLE VIII. DAMAGE OR DESTRUCTION.
Section 8.01. Duty to Restore and Replace.
Section 8.02. Proceeds Justifying Automatic Restoration and Repair.
Section 8.03. Approval by Owners of Special Assessment for
Certain Restorations and Repairs.
Section 8.04. Ordering Reconstruction or Repair.
Section 8.05. Election Not to Rebuild.
Section 8.06. Minor Restoration and Repair Work.
ARTICLE IX. EMINENT DOMAIN.
Section 9.01. Sale to Condemning Authority.
Section 9.02. Distribution of Sales Proceeds..
Section 9.03. Taking and Condemnation Awards.
ARTICLE X. RIGHTS OF MORTGAGEES.
Section 10.01. Warranty.
Section 1.0.02. Subordination.
Section 10.03. Inapplicability of Right of First Reuel.
Section 10.04. Notice of Default.
Section 10.05. Unpaid Assessments.
Section 10.06. Mortgagee Approval of Material Amendments.
Section 10.07. Mortgagee Approval of Other Actions.
Section 10.08. Liens.
Section 10.09. Priority,
Section 10.10. Reserve Fund.
iii
DECLARATION FOR
FRANKLIN COURT
A PLANNED RESIDENTIAL DEVELOPMENT
THIS DECLARATION is made on Dec. 3 , 2007, by BRIAN KING for FRANKLIN COURT
PARTNERSHIP ("Declarant").
RECITALS
A. Declarant is the owner of that certain real property located in the City of Redlands,
County of San Bernardino, State of California, and more particularly described as Tract No.
13649, a subdivision of a portion of Lots 2,7,8 and 9 of Block 10 per Map. No. I of a portion of
Redlands Heights, per map recorded in Book S of Maps, Page 74, Records of San Bernardino
County ("Property"). Being in the City of Redlands, County of San Bernardino, State of
California.
B. Pursuant to the general plan set forth in this Declaration, Declarant intends to
subdivide the Property into Lots and parcels, to improve the Lots and parcels, and to create a
planned development subject to the provisions of the Davis-Stirling Common Interest
Development Act contained in Division II, Pt. 4, Title 6 of the California Civil Code.
C. In furtherance of this intent, Declarant hereby declares that all of the Property is and
shall continue to be held, conveyed, hypothecated, encumbered, leased, rented, used, occupied,
and improved subject to the declarations, limitations, covenants, conditions, restrictions,
reservations, rights, and easements set forth in this Declaration, as this Declaration may be
amended from time to time, all of which are declared and agreed to be in furtherance of a general
plan established for the purpose of enhancing and perfecting the value, desirability, and
attractiveness of the Property. All covenants and restrictions set forth in this Declaration shall
constitute covenants running with the land and enforceable equitable servitudes upon the
Property, and shall be binding on and for the benefit of all of the Property and all parties having
or acquiring any right, title, or interest in all or any part of the Property, including the heirs,
executors, administrators, and assigns of these parties and all subsequent owners and lessees of
all or any part of any Lot in the Development.
ARTICLE 1. DEFINITIONS
—I—
Section. 1.14. Mortgage and First Mortgage. "Mortgage" means a mortgage or deed of trust
encumbering a Lot or any other portion of the Development. "First Mortgage" means a mortgage
that has priority over all other mortgages encumbering the same Lot or other portion of the
Development.
Section 1.15. Mortagee, Institutional Mortgagee and First Mortgagee. "Mortgagee" means a
Person to whom a Mortgage is made and includes the beneficiary of a deed of trust and any
guarantor or insurer of a mortgage. "Institutional Mortgagee" means a mortgagee that is a
financial intermediary or depository, such as a bank, savings and loan,or mortgage company, that
is chartered under federal or state law and that lends money on the security of real property or
invests in such loans, or any insurance company or governmental agency or instrumentality,
including the Federal National Mortgage Association (FNMA), the Federal Home Loan
Mortgage Corporation (FHLMC), and the Government National Mortgage Association (GNMA).
"First Mortgagee" means a Mortgagee that has priority over all other mortgages or holders of
mortgages encumbering the same Lot or other portion of the Development. The term
"Beneficiary" shall be synonymous with the term"Mortgagee."
Section 1.16. Mortgagor. "Mortgagor" means a Person who mortgages his, her, or its property
to another (i.e., the maker of a mortgage), and shall include the trustor of a deed of trust. The
term"Trustor" shall be synonymous with the term"Mortgagor."
Section 1.1 7. Owner. "Owner" means the record holder or holders of record fee title to a Lot,
including Declarant, and any contract sellers under recorded contracts of sale. "Owner" shall not
include any persons or entities who hold an interest in a Lot merely as security for performance
of an obligation.
Section 1.18. Person. "Person" means a natural individual, a corporation, or any other entity
with the legal right to hold title to real property.
Section 1.19. Property. "Property"means the real property described in the Recitals.
Section 1.20. Rules and Regulations. "Rules and. Regulations" means any Rules and
Regulations for Franklin Court Planned Residential Development regulating the use of the
Common Area and adapted by the Association pursuant to Section 3.06(b)of this Declaration.
Section 1.21. Subdivision Map. "Subdivision Map" means the recorded map described in the
Recitals and any subdivision map recorded in connection with the annexation of additional real
property to the Development pursuant to Article XI of this Declaration.
ARTICLE 11. THE PROPERTY
(7) The right of each Owner to the exclusive use of any Exclusive Use Common
Area appurtenant to the Owner's Lot.
(8)The rights of Declarant as described in this.Declaration.
(9)The right of the Association to reasonably restrict access to roofs, maintenance
facilities or areas, landscaped areas, and similar areas of the Development.
(10) The right of the Architectural Control Committee to approve any proposed
alteration or modification to the Common Area or any Lot.
(c) Declarant hereby reserves easements for common driveway purposes, for drainage and
encroachment purposes, and for ingress to and egress from the Common Area. These easements
may be used to complete improvements on the Common Area and to perform necessary repair
work. These easements shall remain in effect for three years from the date of closing of the first
sale of a Lot in the Development.
(d) The Association may grant to third parties easements in, on, and over the Common
Area for the purpose of constructing, installing, or maintaining necessary utilities and services,
and each Owner, in accepting his or her deed to the Lot, expressly consents to these easements.
However, no such easement can be granted if it would interfere with any exclusive easement, or
with any Owner's use, occupancy, or enjoyment of his or her Lot or any Exclusive Use Common
Area appurtenant to the Lot.
(e) A "Class A" Owner who has sold his or her Lot to a contract purchaser or who has
teased or rented the Lot shall be entitled to delegate his or her rights to use and enjoy the
Common Area to any contract purchaser, tenant, or subtenant who resides in the Owner's Lot,
subject to reasonable regulation by the Board. If the Owner makes such a delegation of rights,the
Owner and the Owner's family, guests, employees, and invitees shall not be entitled to use and
enjoy the Common Area for so long as the delegation remains effective.
(f) Each Owner shall be liable to the Association for any damage to the Common Area or
to Association-owned property, to the extent that the damage is not covered by insurance, if the
damage is sustained because of the negligence, willful misconduct, or unauthorized or improper
installment or maintenance of any improvement by the Owner or the Owner's family, guests,
tenants, contract purchasers, tenants, or invitees. In the case of joint ownership of a Lot, the
liability of the co-owners shall be joint and several, unless the co-owners and the Association
have agreed in writing to an alternative allocation of liability.
Section 2.05. Non-Guest Parking Spaces to be Exclusive Use Common Areas. Each Owner
shall have the exclusive right to use, for parking purposes only, any parking space or spaces that
may be allocated to the Owner's Lot in the future. Each parking space shall be an Exclusive Use
Common Area. Additional Exclusive Use Common Areas may be designated in the future by the
Association, provided that the designation is not inconsistent with the rights of any Owner. Any
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powers prescribed by law and set forth in this Declaration, the Articles of incorporation, and the
Bylaws.
Section 3.02. Membership. Every Owner, upon becoming an Owner, shall automatically
become a Member of the Association. Ownership of a Lot is the sole qualification for
membership. Each Member shall have the rights, duties, privileges, and obligations set forth in
the Governing Instruments. Membership shall automatically cease when the Owner no longer
holds an ownership interest in a Lot. All memberships shall be appurtenant to the Lot conveyed,
and cannot be transferred, assumed, conveyed, hypothecated, pledged, or alienated except as part
of a transfer of the Owner's entire ownership interest, and then only to the transferee. Any
transfer of the Owner's title to his or her Lot shall automatically transfer the appurtenant
membership to the transferee.
Section 3.03. Classes of Membership. The Association shall have two classes of voting
membership, as follows:
(a) All Owners, other than the Declarant, shall be "Class A" members. Class A
membership entitles the holder to one vote for each Lot owned. When a Lot is owned by more
than one person, only one vote may be cast for the Lot, as provided in Section 3.04(b) of this
Declaration.
(b) The Declarant shall be the sole "Class B" member. The Class B member shall be
entitled to three votes for each Lot owned. Class B membership shall cease and be converted to
Class A membership upon the occurrence of whichever of the following is first in time:
(1) The total outstanding votes of the Class A Owners equals or exceeds the total
outstanding votes of the Class B member, or
(2) On a prescribed date to be established by the Board, which must not be later
than the second anniversary of the first conveyance of a Lot following the original issuance of the
final subdivision public report for the Development.
Section 3.04. Voting Rights. All voting rights of the Owners shall be subject to the following
restrictions, limitations, and requirements:
(a) Except as provided in this Article, on each matter submitted to a vote of the Owners,
each Owner shall be entitled to cast one vote for each Lot owned.
(b) Fractional votes shall not be allowed. When there is more than one record Owner of a
Lot ("co-owners"), all of the co-owners shall be Members, but only one of them shall be entitled
to cast the single vote attributable to the Lot. Co-owners should designate in writing one of their
number to vote. If no such designation is made or if it is revoked, the co-oNvners shall decide
among themselves, by majority vote, how that Lot's vote is to be cast. Unless the Board receives
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Bylaws of the Association. It may perform all acts that may be necessary for or incidental to the
performance of the obligations and duties imposed upon it by this Declaration or the other
Governing Instruments. Its powers shall include, but are not limited to, the following:
(a) The Association shall have the power to establish, fix, levy, collect, and enforce the
payment of assessments against the Owners in accordance with the procedures set out in Article
IV of this Declaration.
(b) The Association shall have the power to adopt reasonable Rules and Regulations
governing the use of the Common Area and its facilities, and of any other Association property.
These Rules and Regulations may include, but are not limited to: reasonable restrictions on use
by the Owners and their family, guests, employees, tenants, and invitees; rules of conduct; and
the setting of reasonable fees for the use of recreational facilities. A copy of the current Rules and
Regulations, if any, shall be given to each Ow=ner and shall be pasted at conspicuous places in the
Common Area. If any provision of the Rules and Regulations conflicts with any provision of this
Declaration, the Articles, or the Bylaws, the Declaration, Articles, or Bylaws shall control to the
extent of the inconsistency.
(c) The Association shall have the right to institute, defend, settle, or intervene in
litigation, arbitration, mediation, or administrative proceedings in its own name as the real party
in interest and without joining with it the Owners, in matters pertaining to the following:
(1) Enforcement of this Declaration, the Articles, Bylaws, and Rules and
Regulations.
(2) Damage to the Common Area.
(3) Damage to the Lots that the Association is obligated to maintain or repair.
(4) Damage to the Lots that arises out of, or is integrally related to, damage to the
Common Area or Lots that the Association is obligated to maintain or repair.
The Association shall enforce payment of assessments in accordance with the provisions
of Article IV of this Declaration.
(d) In addition to the general power of enforcement described above, the Association may
discipline its Owners for violation of any of the provisions of the Governing Instruments or Rules
and Regulations by suspending the violator's voting rights and privileges for use of the Common
Area, or by imposing monetary penalties, subject to the following limitations:
(1) The accused Owner shall be given notice and an opportunity to be heard with
regard to the alleged violation in accordance with the provisions of Corporations Code Section
7341 and Civil Code Section I363(b).
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additional work shall be charged solely to the Owner of the Lot in the month in which the work is
performed. Further, the Owner of a Unit shall pay the costs of any temporary relocation of any
occupant of the Unit occasioned by the presence of wood-destroying pests or organisms. If the
Owner does not pay for the additional work within 30 calendar days ager receiving the bill, the
Association shall institute appropriate collection actions and shall recover the reasonable costs of
collection, including attorneys' fees and interest from the due date until paid at the rate of 12
percent per annum.
(b) The Association shall use the maintenance fund described in Section 4.01 of this
Declaration to, among other things, acquire and pay for the following:
(1) Water, electrical, and other necessary utility service for the Common Area and,
to the extent not separately metered and charged, for the Lots;
(2)The insurance policies described in Article VII of this Declaration;
(3) The services of any personnel that the Board determines are necessary or
proper for the operation of the Common Area; and
(4) Legal and accounting services necessary or proper in the operation of the
Common Area or the enforcement of this Declaration.
(c) If the Association is obligee under a bond or other arrangement to secure the
performance of Declarant as to any Common Area improvements that were not completed prior
to the issuance of the final public report on the Development, the following procedures shall
govern the initiation of action to enforce the bond:
(1) The Board of Directors of the Association shall consider and vote on the
question of action by the Association to enforce the obligations under the bond with respect to
any improvement for which a Notice of Completion has not been filed within 60 days after the
completion date specified for the improvement in the Planned Construction Statement appended
to the bond. If the Association has given an extension in writing for the completion of any
Common Area improvement, the Board shall consider and vote on the above question if a Notice
of Completion has not been filed within 30 days after the expiration of the extension.
(2) If the Board votes not to initiate action to enforce the obligations under the
bond, or if it fails to consider and vote on the matter as required, a special meeting of the Owners
of the Association shall be called for the purpose of overriding the Board's decision or for taking
action on the matter, upon receipt of a petition calling, for such a meeting signed by Owners
representing at least 5 percent of the total voting power of the Association. The meeting shall be
held not less than 35 days or more than 45 days after receipt of the petition by the Board. At the
special meeting, only the Owners other than Declarant shall be allowed to vote on the matter. A
vote by a majority of the voting power of the Association residing in Owners other than
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(e) Within 120 days after the close of each fiscal year, the Association shall prepare and
distribute to the Ow=ners an annual report consisting of the following:
(1) A balance sheet as of the end of the fiscal year.
(2) An operating(income) statement for the fiscal year.
(3) A statement of changes in financial position for the fiscal year.
(4) For any fiscal year in which the gross income to the Association exceeds $
75,000, a copy of the review of the annual report prepared in accordance with generally accepted
accounting principles by a licensee of the California State Board of Accountancy. If this report is
not prepared by an independent accountant, it shall be accompanied by the certificate of an
authorized officer of the Association that the statement was prepared without independent audit
or review from the books and records of the Association.
(f) Within 60 days before the beginning of each fiscal year, the Association shall prepare
and distribute to the Owners a statement describing the Association's policies and practices in
enforcing lien rights or other legal remedies for default in payment of assessments against
Owners.
(g) The Association shall prepare a balance sheet, as of an accounting date that is the last
day of the month closest in time to six months from the date of closing of the first sale of a Lot in
the Development, and an operating statement for the period from the date of the first closing to
the foregoing accounting date. The Association shall distribute this statement to the Owners
within 60 days after the accounting date. This operating statement shall include a schedule of
assessments received and receivable identified by the number of the Lot and the name of the
Owner assessed.
(h) Each year,the Association must provide the Owners with a summary of the provisions
of Civil Code Sections 1.369.510 through 1369.590. These statutes require that alternative dispute
resolution be pursued before a civil action may be filed in connection with certain disputes
related to enforcement of the governing documents, the Davis-Stirling Common interest
Development Act ( Civ. Code § 1350 et seq.), or the Nonprofit Mutual Benefit Corporation. Law
( Corp. Code § 711.0 et seq.). The required summary must include a specific reference to Civil
Code Sections 1.369.51.0 through 1369.590, and the statutory language set forth in. Civil Code
Section 1369.590(a). This summary must be provided either (1) at the time the pro forma
operating budget described in Section 3.07(d) of this Declaration is distributed, or (2) in the
manner specified in.Corporations Code Section 5416.
(i) The Association shall provide any Owner with the following documents within 10
days of the mailing or delivery of a written request therefor:
(1) A copy of the Governing Instruments.
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(d) If the parties reach agreement on a resolution of the dispute, that resolution shall be
memorialized in writing and signed by the parties with the Board designee signing on behalf of
the Association.
(e) An agreement reached by the parties is binding on them and may be judicially
enforced provided the agreement is consistent with the authority granted by the Board of
Directors to its designee, and further provided the agreement is not in conflict with law or the
Association's governing documents.
(f) A member of the Association may not be charged a fee to participate in the dispute
resolution procedure.
ARTICLE IV. ASSESSMENTS AND COLLECTION PROCEDURES
Section 4.01. Covenant to Pay. The Declarant covenants and agrees, for each Lot owned by it
in the Development, and each Owner by acceptance of the deed to the Owner's Lot is deemed to
covenant and agree, to pay to the Association the regular and special assessments levied pursuant
to the provisions of this Declaration. A regular or special assessment and any late charges,
reasonable costs of collection, and interest, as assessed in accordance with the provisions of this
Article, shall be a debt of the Owner of the Lot at the time the assessment or other sums are
levied. The Owner may not waive or otherwise escape liability for these assessments by nonuse
of the Common Area or abandonment of the Owner's Lot.
Section 4.02. Exemptions From Assessments. The obligation to pay assessments shall be
subject to the following exemptions:
(a) Any Owner(including Declarant) of a Lot in the Development that does not include a
structural improvement for human occupancy shall be exempted from that portion of any
assessment that is for the purpose of defraying expenses and reserves directly attributable to the
existence and the use of those structural improvements. This exemption shall include, but is not
limited to, the following:
(1) Roof replacement;
(2) Exterior maintenance;
(3) Walkway and carport lighting;
(4) Refuse disposal;
(5) Cable television; and
(6) Domestic water supplied to living units.
Any such exemption shall be in effect only until the occurrence of the earliest of the following
events: (1) the recordation of a notice of completion of the structural improvement; (2) the
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Section 4,07. Limitations on Assessments. The Board shall comply with the following
requirements governing the imposition and amounts of assessments:
(a) For any fiscal year, the Board may impose a regular assessment per Lot that is as
much as 20 percent greater than the regular assessment for the preceding fiscal year, provided (1)
the Board has distributed the pro forma operating budget described in Section 3.07(d) for the
current fiscal year or (2) the increase is approved by Owners constituting a majority of the votes
at a meeting or in an election of the Association conducted in accordance with Corporations
Code Sections 7510-7527 and 7613.
(b) The Board may impose, for any fiscal year, a regular assessment per Lot that is more
than 20 percent greater than the regular assessment for the preceding fiscal year, or may levy
special assessments that in the aggregate exceed 5 percent of the budgeted gross expenses of the
Association for that fiscal year, provided the increase or levy is approved by Owners constituting
a majority of the Owners of the Association and casting a majority of the votes at a meeting or
election of the Association conducted in accordance with Corporations Code Sections 7510-7527
and 7613.
(c) The Board may, without complying with the foregoing requirements, make an
assessment increase that is necessary for an emergency situation. An emergency situation is an
extraordinary expense that is:
(1) Required by a court order.
(2) Necessary to repair or maintain the Development or any part of it for which the
Association is responsible when a threat to personal safety in the Development is discovered.
(3) Necessary to repair or maintain the Development or any part of it for which the
Association is responsible that could riot have been reasonably foreseen by the Board in
preparing and distributing the pro forma operating budget pursuant to Section 3.07(d).
(4) Incurred in making the first payment of the earthquake insurance surcharge pursuant
to Insurance Code Section 5003.
Before the Board may impose or collect an assessment in the type of emergency situation
described in (3), above, it shall pass a resolution containing written findings as to the necessity of
the extraordinary expense and why the expense was not or could not have been reasonably
foreseen in the budgeting process, and shall distribute the resolution to the Owners with the
notice of assessment.
(d) The Board shall notify the Owners in writing of any increase in the amount of a
regular or special assessment. The Board shall provide this notice by first-class mail not less than
30 or more than 60 days prior to the due date of the increased assessment.
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An Owner also may submit a written request to meet with the Board to discuss a payment plan
for the debt. The request must be mailed within 15 days of the mailing of the Board's notice. The
Board must then meet with the Owner in executive session within 45 days of the mailing of the
Owner's-request. If there is no regularly scheduled Board meeting within that time period, the
Board may designate a committee of one or more members to meet with the Owner.
Any partial payments made toward the debt will first be applied to the assessments owed, and
only after the principal owed is paid in full will the payments be applied to the fees and costs of
collection, attorneys' fees, late charges, or interest. When an Owner makes a payment, the Owner
may request a receipt and the Association shall provide it. The receipt shall indicate the date of
payment and the person who received it. The Association shall provide a mailing address for
overnight payment of assessments.
A debt for a delinquent regular or special assessment and any late charges, reasonable fees and
costs of collection, reasonable attorneys' fees, and interest shall become a lien on the Lot when a
notice of delinquent assessment is duly recorded and mailed as provided in Section 1367.1 of the
California Civil Code.
Except as provided below regarding debts arising from delinquent assessments when the debt
arose on or after January 1, 2006, and the delinquent amount is less than $1,800, any such lien
may be enforced in any manner permitted by law, including judicial foreclosure or nonjudicial
foreclosure. Any nonjudicial foreclosure shall be conducted by the trustee named in the notice of
delinquent assessment or by a trustee substituted pursuant to Section 2934a of the California
Civil Code, in accordance with the provisions of Sections 2924, 2924b, and 2924c of the
California Civil Code.
If the sums specified in the notice of delinquent assessment are paid before the completion of any
judicial or nonjudicial foreclosure, the Association shall record a notice of satisfaction and
release of the lien. On receipt of a written request by the Owner, the Association shall also record
a notice of rescission of any declaration of default and demand for sale.
In accordance with Section 1367.4 of the California Civil Code, a lien securing a debt arising
from a delinquent regular or special assessment when the debt arose on or after January 1, 2006,
and the delinquent amount is less than $1,800, excluding accelerated assessments, late charges,
fees and costs of collection, attorney's fees, and interest, shall not be enforced by judicial or
nonjudicial foreclosure unless and until either (1) the debt equals or exceeds $1,800, excluding
accelerated assessments, late charges, fees and costs of collection, attorney's fees, and interest, or
(2) the debt secured by the lien is more than 12 months delinquent.
Section 4.10. Statement Regarding Assessments. The Association shall provide any Owner,
upon written request, with a statement specifying (1) the amounts of the Association's current
regular and special assessments and fees, and (2) the amounts of any delinquent assessments and
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(i) Alter or modify the exterior of any improvements located on a Lot without first
obtaining the written consent of the Architectural Control Committee.
0) Install a solar energy system in a Unit owned by another without first obtaining the
written consent of the Architectural Control Committee.
(k) Alter, construct, or remove anything on or from the Common Area, except upon the
written consent of the Board.
(1) Park any automobile or other motor vehicle in the Common Area or in any Exclusive
Use Common Area except in a space designated for the Owner by the Board or the Governing
Instruments.
Section 5.02. Damage Liability. Each Owner shall be liable to the Association for all damage
to the Common Area or other Association property that is sustained by reason of the negligence
or willful misconduct of that Owner or his or her family, guests,employees, tenants, and invitees.
Section 5.03. Exemption. Declarant shall be exempt from the restrictions of Section 5.01 to
the extent necessary to complete any construction work, sales activities, or additions to or
affecting the Development. This exemption includes, but is not limited to, maintaining Lots as
model homes, placing advertising signs on Development property, and generally using Lots and
the Common Area to carry on construction activity.
Section 5.04. Equitable Servitudes. The covenants and restrictions set forth in this Declaration
shall be enforceable equitable servitudes and shall inure to the benefit of and. bind all Owners.
These servitudes may he enforced by any Owner or by the Association or by both.
ARTICLE I. ARCHITECTURAL AND DESIGN CONTROL
Section 6,01. Architectural and Design Approval. No building, addition, wall, fence, or
alteration shall be begun, constructed, maintained, or permitted to remain on any Lot, or on the
Common Area, until complete plans and specifications of the proposed work have been
submitted to and approved by the Architectural Control Committee. The Committee shall review
the plans and specifications to determine whether they are compatible with the standards of
design, construction, and quality of the Development and, if they are not, shall require that
changes be made before approval.
Section 6,02. Architectural Control Committee. The Architectural Control Committee shall
consist of at least three but not more than five members, formed as follows:
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Section 7,02. General Liability and Individual Liability Insurance. The Association shall
obtain and maintain one or more policies of insurance that must include coverage for(1) general
liability of the Association and (2) individual liability of Officers and Directors of the
Association for negligent acts or omissions in that capacity. Both of the above types of coverage
shall not be less than $ 1,000,000 covering all claims for death, personal injury, and property
damage arising out of a single occurrence.
The limits and coverage shall be reviewed at least annually by the Board and increased in its
discretion.
Section 7.03. Other Association Insurance. The Association shall purchase and maintain
workers'compensation insurance to the extent necessary to comply with any applicable laws. The
Association also shall purchase and maintain fidelity bond coverage that names the Association
as an obligee, for any person or entity handling funds of the Association, whether or not such
persons or entities are compensated for their services. This coverage shall be in an amount that is
at least equal to the estimated maximum of funds, including reserve funds, in the custody of the
Association [or the Manager] at any given time during the term of each bond. However, the
aggregate amount of these bonds must not be less than 150 percent of each year's estimated
annual operating expenses and reserves, The Association also may purchase and maintain a
blanket policy of flood insurance, and demolition insurance in an amount that is sufficient to
cover any demolition that occurs following the total or partial destruction of the Development
and a decision not to rebuild.
Section 7.04. Trustee for Policies. The Association, acting through its Board, is hereby
appointed and shall be deemed trustee of the interests of all named insureds under all insurance
policies purchased and maintained by the Association. All insurance proceeds under any of those
policies shall be paid to the Board as trustee. The Board shall use the proceeds for any of the
purposes specified in Article Vill of this Declaration. The Board also is authorized to negotiate
loss settlements with the appropriate insurance carriers, to compromise and settle any claim or
enforce any claim by any lawful action, and to execute loss claim forms and release forms in
connection with such settlements.
Section 7.05. Individual Insurance. Each Owner shall provide fire and casualty insurance for
the improvements on his or her Lot. An Owner may separately insure his or her personal
property, and may obtain and maintain personal liability and property damage liability insurance
for his or her Lot, provided that the insurance contains a waiver of subrogation rights by the
carrier as to the other Owners, the Association, Declarant, and the institutional First Mortgagees
of the Ownces Lot.
Section 7.06. Insurance Premiums. Insurance premiums for any insurance coverage obtained
by the Association shall be included in the regular assessments. That portion of the regular
assessments necessary for the required insurance premiums shall be used solely for the payment
of the premiums when due.
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may elect to reject all of the bids and thus not to rebuild, or Owners representing at least 51
percent of the total voting power may elect to reject all bids requiring amounts exceeding the
available insurance proceeds by more than $ 500. Failure to reject all bids shall authorize the
Board to accept the unrejected bid it considers most favorable. Failure to call the special meeting
or to repair the casualty damage within 12 months from the date the damage occurred shall be
deemed for all purposes to be a decision not to rebuild.
(c) If a bid is accepted, the Board shall let the contract to the successful bidder and
distribute the insurance proceeds to the contractor as required by the contract.
(d) Levy a special assessment to make up any deficiency between the total insurance
proceeds and the contract price for the repair or rebuilding, with the assessment and all insurance
proceeds, whether or not subject to liens of mortgagees, to be used solely for the rebuilding. This
assessment shall be apportioned equally to each Lot. If any Owner fails to pay the special
assessment within 15 days after it is levied, the Board shall enforce the assessment in the manner
described in Section 4.09 of this Declaration.
Section 8.05. Election Not to Rebuild. Upon an election not to rebuild, the Board, as soon as
reasonably possible and as agent for the Owners, shall execute and record a certificate stating that
the Association shall not rebuild. The Board shall also sell the entire Development on terms
acceptable to the Board and free from the effect of this Declaration, which shall terminate upon
the sale. The net proceeds shall then be distributed to the Owners and their respective
Mortgagees proportionately according to the respective fair market values of the Lots at the time
of the destruction as determined by an independent appraisal. That appraisal shall be performed
by an independent appraiser who shall be selected by the Association and who shall be a member
of, and apply the standards of, a nationally recognized appraiser organization.
All insurance proceeds available for restoration or repair shall be distributed to the
Owners equally,
Section 8.06. Minor Restoration and Repair Work. The Association shall order restoration or
repair work without complying with the other provisions of this Article whenever the estimated
cost of the work does not exceed $18,000 for the Common Area and $3,000 for one or more
Lots. If insurance proceeds are unavailable or insufficient, the Association shall levy a special
assessment for the cost of the work. The Assessment shall be levied in the manner described in
Section 4.05 of this Declaration.
ARTICLE IX EMINENT DOMAIN
Section 9.01. Sale to Condemning Authority. If a governmental agency proposes to condemn
all or a portion of the Common Area, the Association may sell all or any portion of the Common
Area to the condemning authority if 75 percent of the Owners and 67 percent of all institutional
First Mortgagees approve the sale in advance. Any such sale shall be made by the Association in
—"?5_..
Section 10.05. Unpaid Assessments. Any First Mortgagee who obtains title to a Lot pursuant
to the remedies provided in the Mortgage or foreclosure of the Mortgage shall not be liable for
the Lot's unpaid assessments that accrue prior to the acquisition of title to the Lot by the
Mortgagee.
Section 10.06. Mortgagee Approval of Material Amendments. Notwithstanding Article XII of
this Declaration, any amendments governing any of the following shall require the prior written
approval of at least 51 percent of the First Mortgagees and at least 67 percent of the total voting
power of the Owners:
(a)Voting;
(b) Rights to use the Common Area;
(c) Reserves and responsibility for maintenance, repair, and replacement of the Common
Area;
(d) Boundaries of any Lot;
(e)Owners' interests in the Common Area;
(f)Convertibility of Lots into Common Area or Common Area into Lots;
(g) Leasing of Lots;
(h) Establishment of self-management by the Association, when professional
management has been previously required by any First Mortgagee or any insurer or governmental
guarantor of a First Mortgage;
(i)Annexation, addition, or withdrawal of real property to or from the Development;
0)Assessments,assessment liens,or the subordination of these liens;
(k)Casualty and liability insurance or fidelity bonds;or
(1) Any provisions expressly benefitting First Mortgagees or insurers or governmental
guarantors of First Mortgages.
Notwithstanding the above, any First Mortgagee who receives a written request ft-orn the
Board to approve a proposed amendment or amendments requiring consent under this Section
who does not deliver a negative response to the Board within 30 days of the receipt of the request
shall be deemed to have approved the proposed amendment or amendments.
Section 10.11. Management. Any agreement for professional management of the Development
shall not exceed three years and shall provide that either party may terminate the agreement, with
or without cause and without the imposition of a termination fee, on 90 days written notice. The
approval of holders of at least 75 percent of First Mortgages shall be obtained before the
Association terminates a professional management agreement.
Section 10.12. Right to Inspect Books and Records. Institutional First Mortgagees, upon
written request, shall have the right to (1) examine the books and records of the Association
during normal business hours; and (2) require the submission of any financial data furnished to
the Owners by the Association.
Section 10.13. Payments by Mortgagees. First Mortgagees may,jointly or severally, pay taxes
or other charges that are in default and that may or have become a charge against the Common
Area, and may pay any overdue premiums on hazard insurance policies, or secure new hazard
insurance coverage upon the lapse of a policy, for the Common Area, and First Mortgagees
making these payments shall be entitled to immediate reimbursement from the Association.
Section 10.14. Right to Furnish Mortgage Information. Each Owner hereby authorizes the
First Mortgagee of a First Mortgage on the Owner's Lot to furnish information to the Board
concerning the status of the First Mortgage and the loan that it secures.
ARTICLE X1. ANNEXATION OF ADDITIONAL PROPERTY
Section 11.01. Additions by Declarant. Declarant shall have the right to add real property to
the Development, pursuant to a plan of phased development submitted to the California Real
Estate Commissioner along with the application for the public report for the first phase of the
Development, at any time before the third anniversary of the original issuance of the most
recently issued final subdivision public report for the most recent phase of the Development. This
election shall be made by the recordation of a supplemental declaration ("Supplemental
Declaration"). The Supplemental Declaration shall describe the real property to be annexed, and
shall state that the property described in it is being annexed to the Development pursuant to
Article XI of this Declaration. The Supplemental Declaration may also set forth any additional
covenants, conditions, restrictions, reservations, and easements that Declarant deems appropriate
for that phase of development.
Section 11.02. Other Additions. In addition to real property annexed by the Declarant, real
property may be annexed to the Development and brought within the general plan and scheme of
this Declaration by the approval by vote or written consent of at least 67 percent of the total
voting power of the Association.
President of the Association , and (3) that writing has been recorded in the county in which this
Development is located.
Section 12.03. Amendments Pursuant to Court Order. If this Declaration requires a proposed
amendment to be approved by the affirmative vote of a specified percentage (exceeding 50
percent) of the votes in the Association or of Owners having a specified percentage (exceeding
50 percent) of the votes in more than one class (a "supermajority"), and more than 50 percent but
less than the required supermajority of the votes approve the amendment, the Association or any
Owner may petition the Superior Court of San Bernardino County, subject to the requirements,
limitations, and exceptions set forth in Civil Code Section 1356, for an order reducing the
percentage of the affirmative votes necessary for the amendment or approving the amendment. If
such an order is issued, the amendment shall be acknowledged by any person designated by the
Association for that purpose or, if no such designation is made, by the President of the
Association, and that person shall have the amendment and the court order recorded in San
Bernardino County. Upon recordation, the amended provision or provisions of this Declaration
shall have the same force and effect as if the amendment were adopted in compliance with every
requirement imposed by this Declaration and the other governing documents. Within a
reasonable time after recordation, the Association shall mail a copy of the amendment and a
statement regarding the amendment to each Owner.
Section 12.04. Deletion of Construction or Marketing Provisions. Notwithstanding any other
provision of this Declaration, the Board may, under the circumstances described in this Section,
adopt an amendment deleting from this Declaration any provision that was unequivocally
designed and intended, or that by its nature could only have been designed or intended, to
facilitate Declarant in completing the construction or marketing of the Development. To be
subject to this amendment procedure, the provision must provide for access by Declarant over or
across the Common Area for the purposes of(1) completion of construction of the Development
and (2) the erection, construction, or maintenance of structures or other facilities designed to
facilitate the completion of construction or marketing of Lots or improvements on them. Such an
amendment may be adopted only after Declarant has completed construction of the Development,
has terminated construction activities, and has terminated its marketing activities for the sale of
the Lots. At least 30 days prior to taking action to adopt such an amendment, the Board must
mail to all Owners, by first-class mail, the following: a copy of the proposed amendment; and a
notice of the time, date, and place of the meeting at which the Board will consider adoption of
the amendment. All deliberations of the Board on the proposed amendment must be conducted at
that meeting. The meeting must be open to all Owners, and the Owners must be given an
opportunity at the meeting to comment on the proposed amendment. The Board may not adopt
the amendment unless (1) a quorum is present at the meeting, (2) the meeting is conducted in
accordance with certain provisions (identified in Civil Code Section 1355.5) of the Nonprofit
Mutual Benefit Corporation Law, and (3) Owners casting a majority of the votes at the meeting
approve the amendment. For these purposes, "quorum" means more than 50 percent of the
Owners who own no more than two Lots in the Development.
divestment of the Owner's entire interest in his or her Lot with respect to obligations arising from
and after the date of the divestment.
Section 13.08. Fair Housing. Neither Declarant nor any Owner shall, either directly or
indirectly, forbid the conveyance, encumbrance, renting,, leasing, or occupancy of the Owner's
Lot to any person on the basis of race, color, sex, religion, ancestry, or national origin.
Section 13.09. Right of City to enforce Declaration. The City of Redlands shall have the right,
but not the obligation, to enforce compliance with the provisions of this declaration.
Section 13.10. Number and Headings. As used in this Declaration, the singular shall include
the plural, unless the context requires the contrary. The headings are not a part of this
Declaration, and shall not affect the interpretation of any provision.
EXECUTED on at California.
DECLARANT
FRANKLIN COURT PARTNERSHIP
A California General Partnership
By:
Brian King, 0eneAl Partner
—33—
SUBORDINATION AGREEMENT
I" Centennial Bank, being the beneficiary under that certain Deed of Trust recorded
September 19, 2007, as Instrument No. 2007-0537056 of Official Records of San
Bernardino County, California("Deed of Trust"), hereby declares that the liens and
charges of said Deed of Trust are and shall be subordinate and inferior to the Declaration
of Covenants, Conditions and Restrictions for Franklin Court, a general partnership,
Franklin Court Homeowners Association, a non-profit mutual benefit corporation, and
Tract 13649,to which this Subordination Agreement is attached, as amended or restated.
By executing this Subordination Agreement, the undersigned agrees that should the
undersigned acquire title to all or any portion of the project by foreclosure (whether
judicial or non judicial), deed-in-lieu of foreclosure or any other remedy in or relating to
the Deed of Trust,the undersigned will acquire title subject to the provisions of the
Declaration, as amended or restated, which shall remain in full force and effect.
DATED 31 `2 W-1 LIENHOLDER:
0 Centennial Bank
By�
-& " N. Schoonover
�ffo M
Sr. Vice President
ACKNOWLEDGMENT
STATE OF CALIFORNIA
COUNTY OF SAN BERNARDINO
On br((r,be v- 3, --)buj- , before me, �'11 a Notary
Public in and for the State of California, personally appeared Clifford N.Schoonover,
personally known to me (or proved to me on the basis of satisfactory evidence) to be
the person whose name is subscribed to the within instrument, and acknowledged to
me that he/slid executed the same in his4wr authorized capacity, and that by his/,he
signature on the instrument the person, or the entity upon behalf of which such person
acted,executed the instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year first above written.
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