Author: Hoffman Forde

Hoffman Forde and Co-Counsel Poli, Moon & Zane Secure $23.3 Million Arbitration Award

Posted on January 9, 2026 by - Commercial Real Estate

San Diego, CA – January 9, 2026 – Hoffman Forde and Co-Counsel Poli, Moon & Zane are proud to announce a significant victory on behalf of their client, Key Allegro Condominiums Council of Co-Owners, Inc., in a complex construction defect dispute arising from repairs following Hurricane Harvey. After extensive proceedings before the American Arbitration Association, the Arbitrator issued a Final Award totaling $23,344,615.74, including damages, attorneys’ fees, expenses, and prejudgment interest.

The case centered on systemic construction failures at a 13-building, 100 unit condominium complex in Rockport, Texas. Following catastrophic storm damage in 2017, Key Allegro contracted with Progressive Fire & Flood, Inc. d/b/a Roadrunner Restoration to perform reconstruction work. Despite years of effort and work by Roadrunner, and despite Roadrunner being paid millions of dollars, destructive testing later revealed widespread defects in roofing, siding, and weatherproofing systems. These issues persisted even after a supplemental agreement in 2021 intended to correct prior deficiencies.

In 2021, Roadrunner Restoration Company, LLC acquired assets from the original contractor and continued operations under the same name, personnel, and project identity. The Arbitrator found that the successor entity assumed ongoing contractual obligations and breached its duty to perform repairs in a good and workmanlike manner. The award includes $17.4 million in repair costs, $1.45 million in attorneys’ fees, and $4 million in prejudgment interest, holding Roadrunner Restoration Company, LLC jointly and severally liable.

As stated by Gayle Connolly, Key Allegro’s representative and property manager: “Multiple lawyers and firms told us we had no case.  But Hoffman Forde and Poli, Moon and Zane were relentless in pursuing our claim.  They worked ceaselessly to resolve difficulties and overcome obstacles.  Thanks to their tenacity, we can now move forward with repairs, increasing our owner’s property values and quality of life.  Everyone is beyond grateful for the excellence exhibited by these lawyers and their support team.”

The decision affirms that successor entities cannot evade contractual obligations through restructuring and this substantial award highlights the importance of enforcing warranties and repair duties in large-scale construction projects.

For more information about Hoffman Forde’s construction litigation practice, visit www.hoffmanforde.com.

 

Hoffman Forde is a full-service law firm based in San Diego, with a practice focused on civil litigation, real estate law, business consulting, estate planning, administrative law, personal injury, immigration law, and tax advisory. The firm is known for its commitment to thoughtful advocacy and practical results.

Poli, Moon & Zane is a law firm practicing throughout the western United States and focusing on insurance-related litigation, including representing insureds in claims against their insurance companies where claims have been denied or underpaid, and also working in the arena of construction defect claims against developers and contractors.

Estate Planning Tips to Avoid Probate Litigation

Posted on December 18, 2025 by - Business Consulting

Estate planning is as much about preventing future litigation as it is about distributing assets. A legally valid document alone does not guarantee peace for surviving loved ones. Disputes can arise from unclear instructions, poor record-keeping, family tensions, and questions about mental capacity or undue influence.

The following strategies offer practical, attorney-level insight to help San Diego residents minimize the risk of probate contests and reduce the likelihood of costly and time-consuming litigation.

1. Create and Fund a Revocable Living Trust

A properly funded revocable living trust remains one of the most effective tools for avoiding probate in California. When assets are titled in the name of the trust, they pass under the trustee’s authority bypassing the public probate process and reducing expense and delay.

California also allows Transfer on Death (TOD) deeds for real property, which can facilitate the smooth transfer of assets when drafted correctly. However, even the most carefully prepared trust will fail if it is not funded.

Attorney Tip: Confirm that all assets deeds, accounts, and titles are transferred into the trust’s name. An unfunded trust (often referred to as a “trust on paper”) is a leading cause of unnecessary probate proceedings.

2. Eliminate Ambiguity Around Execution and Capacity

Many probate contests allege lack of testamentary capacity, improper execution, or undue influence. California law imposes specific execution requirements and assesses capacity at the time of signing.

Proper documentation of the planning process meeting notes, capacity observations, and professional involvement helps establish the integrity of the documents. In situations involving advanced age or illness, obtaining a physician’s opinion or recording the execution (used appropriately) can provide valuable evidence if a challenge arises.

Attorney Tip: Maintain comprehensive records of the execution process and client capacity. Well documented files often deter litigation and protect the estate plan’s validity.

3. Use Neutral Professionals to Avoid Conflicts

Family dynamics often create tension that can escalate into disputes. Engaging neutral professionals such as independent attorneys, corporate trustees, or financial advisors reduces the potential for claims of bias or coercion.

Beneficiaries should not be present during drafting or execution. If significant revisions are made close to signing, affected parties should seek independent legal advice. San Diego probate courts routinely recognize the importance of impartiality and transparency when assessing the legitimacy of estate planning document

4. Document Decisions and Maintain Records

A thorough paper trail is one of the most effective deterrents to probate litigation. Retaining prior drafts, meeting notes, and written explanations for major decisions especially when distributions are unequal can demonstrate intent and foresight.

A personal memorandum explaining specific bequests or exclusions may help prevent emotional reactions that lead to contests.

Attorney Tip: Encourage clients to keep a secure, clearly labeled file digital or physical containing estate documents, asset lists, account details, and trustee contact information.

5. Update Beneficiary Designations Regularly

Outdated or inconsistent beneficiary designations on life insurance, retirement accounts, or financial accounts often override provisions in wills or trusts. This inconsistency is a frequent source of probate disputes.

Attorney Tip: Review beneficiary designations every three to five years and after major life events such as marriage, divorce, birth, or death to ensure consistency with the current estate plan.

6. Use No-Contest Clauses and Mediation Provisions Thoughtfully

California law permits no-contest clauses (also known as in terrorem clauses), but their enforceability is limited. When carefully drafted, these clauses can discourage frivolous claims, although they cannot prevent legitimate legal challenges.

Incorporating mediation or arbitration clauses into trust documents can also promote private resolution of conflicts and help families avoid public and adversarial court proceedings.

7. Plan for Trustee and Executor Succession

Unclear or incomplete succession language often leads to disputes over authority. Naming successor trustees and backup executors with clearly defined powers ensures continuity and minimizes the likelihood of contested appointments.

Attorney Tip: Include provisions that grant temporary authority to successor trustees to prevent administrative gaps and protect estate assets during transitions.

Closing Thoughts

No estate plan can guarantee freedom from litigation, but a transparent, well-documented plan significantly reduces risk. The most effective estate plans share the following elements:

  • Properly funded trusts
  • Regularly updated beneficiary designations
  • Documented capacity and clear intent
  • Neutral and qualified fiduciaries
  • Carefully considered dispute-resolution clauses

Estate planning is more than a financial process; it is a proactive measure to preserve family harmony and safeguard a legacy for future generations.

Need Legal Advice?

Estate planning disputes and probate matters can be complex and emotionally charged. Hoffman & Forde, Attorneys at Law, A.P.C. provides experienced counsel to help clients prevent and resolve probate conflicts while protecting their assets and family relationships.

Contact Hoffman & Forde today at (619) 546-7880. The firm’s estate planning and probate attorneys offer clear, strategic guidance to help craft legally sound estate plans and protect family legacies.

Disclaimer

The information in this post is considered attorney advertising under applicable California law. The contents of this post are for informational purposes only and do not constitute legal advice. The information may be incomplete or out of date. No representations, testimonials, or endorsements on this website constitute a guarantee, warranty, or prediction regarding the outcome of any legal matter.

The Art of Drafting: How a Well-Written Contract Protects Your California Business

Posted on November 17, 2025 by - Business Consulting

Running a business in California means balancing opportunity with risk. In such a complex legal environment, one of the most effective ways to protect your company is through a well-drafted business contract.

 A contract is more than a signature or formality—it’s the legal foundation upon which your enterprise operates. When crafted with foresight and precision, it safeguards your interests, strengthens relationships, and ensures stability when challenges arise.

 

Why Contract Precision Matters in California

In California’s fast-evolving business and regulatory landscape, precision is essential. Every clause in a contract must be clear, accurate, and enforceable under state law. Ambiguity or missing details can easily turn into disputes that drain time and resources. As experienced California contract lawyers, we often see issues such as:

  • Vague payment terms or undefined deliverables
  • Missing termination clauses or unclear exit procedures
  • Ambiguous responsibilities between parties
  • Noncompliance with California-specific laws such as AB 5, data privacy, or employment regulations

Each oversight increases the risk of misunderstanding or litigation. A strong, carefully worded contract turns uncertainty into clarity—protecting your rights and ensuring predictability when disagreements occur.

 

Beyond Templates: The Value of Custom Contract Drafting

While downloadable templates or online contract forms might seem convenient, they rarely account for the nuances of California business law. A generic document cannot capture the unique operations, liabilities, or growth strategies of your company.

At Hoffman & Forde, our attorneys take a customized approach to business contract drafting. We tailor each agreement to your goals and industry, ensuring that every clause aligns with your structure and risk profile.

Whether your priority is limiting liability, maintaining confidentiality, or ensuring enforceability, a professionally drafted contract is your first line of defense. It’s not just paperwork—it’s a strategic tool that quietly safeguards your business long after it’s signed.

 

Integrating Contracts into Your Broader Legal Strategy

Strong contracts are most effective when they complement your overall business strategy. Coordinating your agreements with your company’s structure, compliance requirements, and succession plans helps prevent conflicts and ensures long-term continuity.

Regular legal reviews also keep your business protected as laws evolve or your operations expand. This proactive approach strengthens your foundation and supports confident decision-making at every stage of growth.

 

Best Practices for California Business Owners

Protecting your company through solid contracts is an ongoing process. Business owners can reduce risk and maintain compliance by following these best practices:

  • Review key contracts regularly. Update agreements after new partnerships, growth, or changes in California law.
  • Clarify terms. Clearly define payment schedules, performance standards, and dispute resolution processes.
  • Specify governing law. Confirm that California is listed as the controlling jurisdiction for consistency and predictability.
  • Avoid unenforceable clauses. Non-compete and certain indemnity provisions are often limited under state law.
  • Consult legal counsel. Work with a trusted California business attorney before signing, renewing, or terminating major contracts.

Proactive contract management helps your company stay compliant, stable, and ready for what’s ahead. As your business evolves, your contracts should evolve with it—continuing to protect the legacy you’re building.

 

Partner with Experienced California Contract Lawyers

At Hoffman & Forde, we help businesses of all sizes draft, review, and negotiate contracts that stand the test of time. Our team combines deep legal knowledge with practical business insight to ensure every agreement serves your goals and complies with California law.

If you’re ready to strengthen your company’s legal foundation, contact Hoffman & Forde, Attorneys at Law for personalized guidance in business contract drafting and review.

Your business deserves contracts as strong and forward-thinking as your vision.

 

Need Legal Advice?

Succession and continuity planning is more than preparing documents—it is about securing the future of your business and the people who depend on it. Every company is unique, and the right plan should reflect your goals, values, and long-term vision.

Contact us today at (619) 546-7880 to learn how our attorneys can help you design a strategy that protects both your business and your family interests.

 

Disclaimer: The information in this post is considered attorney advertising under applicable California law. The contents of this post are for informational purposes only and do not constitute legal advice. The information may be incomplete or out of date. No representations, testimonials, or endorsements on this website constitute a guarantee, warranty, or prediction regarding the outcome of any legal matter.

Benefits of Putting Your Property in Trust: A Comprehensive Guide

Posted on June 11, 2024 by - Estate Planning

Estate planning can often seem daunting, especially with the array of arrangements available for your property. However, understanding some fundamental facts can significantly ease the process.

This post explores the significant advantages of setting up a living trust and how it safeguards your assets and ensures privacy. If you want to bypass probate court, shield your assets, maintain control over them, or keep your affairs private, a living trust is a powerful tool to consider.

What is a living trust?

A living trust is a legal document that facilitates the transfer of your property into a trust, allowing you to retain complete control during your lifetime. After your passing, the assets are distributed to your chosen beneficiaries under the guidance of a trustee whom you appoint.

Types of living trust

  • Revocable Living Trusts – The grantor may change or cancel these while s/he remains alive.
  • Irrevocable Living Trusts – These can be less flexible once set but offer better asset protection and possible tax savings.

Benefits of a Living Trust

Living trusts are widely recommended for future planning after one’s passing. Here are the key advantages:

  • Avoid Probate – Trusts help your beneficiaries save a lot of time and money by avoiding the probate process. Probate is expensive, often costing over $40,000 in attorney fees and other expenses to administer an estate. A living trust provides a simple and efficient way to distribute your property upon death.
  • Protect Your Privacy – Probate is an intrusive process because it becomes a matter of public record, allowing virtually anyone to access the information you provide to the courts. In contrast, a living trust helps maintain the confidentiality of the estate transactions, ensuring the intended will is enforced privately.
  • Maintain Control – With a living trust, transferred assets remain your property during your lifetime but are placed in a separate legal entity known as a trust. This arrangement allows you to increase, decrease, and make changes to the trust as necessary, ensuring it always reflects your current circumstances.

Why a living trust is essential?

A living trust is a powerful tool that goes beyond avoiding probate. Here are some additional benefits you might not be aware of:
  • Continuity of Management – A living trust offers the advantage of taking over the management of your property on your behalf if you become incapacitated, eliminating the need for a guardian to oversee your affairs. This makes the process easy, stress-free, and a relief for your family, especially during such trying times.
  • Asset Protection – Over the years, a well-planned trust has been an effective way to safeguard property from various threats, such as creditors, lawsuits, and future financial hardships. It is essential for protecting your assets to ensure they can be passed on to your intended heirs.
  • Flexibility and Control – Unlike a will, a living trust can be altered or terminated at any time before the death of the person who created it, offering outstanding versatility to the creator. You remain in control of your resources, while the beneficiaries are designated to receive them according to your instructions.
  • Tax Benefits – Using a living trust can lead to significant tax savings, depending on your financial situation. Our dedicated attorneys, with extensive experience in trust matters, can assist you in designing your trust to avoid or reduce estate taxes and other taxes that may be due on your trust.
  • Privacy and Confidentiality – Another essential advantage of a living trust that is often overlooked is that its provisions are protected from public access. Unlike a will, which goes through the public probate process, a living trust remains private as it is part of the living person’s estate. This means others cannot access your estate plan to determine the value or distribution of the property included in the trust.

Do I Need a Trust?

If you’re interested in understanding the significance of living trusts in your family’s life and altering your estate planning approach, contact us today at (619) 546-7880 for a consultation. Our intake specialist will engage with you to gather vital information to evaluate your situation.

These New California Laws Take Effect in 2024

Posted on February 29, 2024 by - Law

Last year, California Governor Gavin Newson signed several major laws passed by the state legislature. These bills, all of which went into effect January 1, impact a wide range of California residents, including business owners, employees, non-profit institutions, and even some Mexican residents looking for access to more affordable education.
Here are some of the changes you can expect to see in 2024. 

Extended Sick Leave  

Until recently, California law only required employers to provide employees three days (24 hours) of paid sick leave. As of January 1, California workers are entitled to five days (40 hours) of paid sick leave.

It’s worth noting that this change only extends to employees who have worked for the same employer for at least 30 days. The law applies to the following employees: 

  • Full-time
  • Part-time
  • Workers hired on an as-needed basis
  • In-home supportive service providers
  • And temporary employees

There are a few minor exemptions, but the law applies to most workers who meet the 30-day employment requirement. 

Protection For Recreational Marijuana Users

Late last year, Governor Newsom extended California’s Fair Employment and Housing Act (FEHA) with Senate Bill 700, a bill designed to protect workers from discrimination related to cannabis use. The bill prohibits employers from requesting information related to applicants’ prior use of marijuana.

In addition to Senate Bill 700, Assembly Bill 2188 further protects employees and applicants by prohibiting employers from:

  • Discriminating against employees who use cannabis on their time, outside of work
  • Taking adverse action against an employee who shows the presence of non-psychoactive cannabis metabolites (substances that do not cause a “high” or impair one’s ability to work)

There are some exceptions, however. The bill does not extend to construction workers and those applying to positions that require a federal background check or security clearance. 

More Access to Affordable Housing

It’s no secret—California has long ensured a housing shortage.

The new Senate Bill 4 bill opens up 170,000 acres of land for affordable housing, allowing non-profit colleges, churches, mosques, and other faith organizations to transform excess land and parking lots into affordable housing.

This new law allows qualifying institutions to bypass local permit restrictions to address California’s homeless crisis.

It’s also worth noting that Senate Bill 423 further strengthens affordable housing development by expediting approvals of affordable housing projects and introducing new labor standards that will make these projects more appealing to construction unions. 

In-State College Tuition For Some Mexican Residents

Nearly 170,000 people crisscross the California-Mexico border daily for work, school, or recreation. Assembly Bill 91 gives some individuals greater access to affordable education in the United States.

More specifically, the bill allows low-income students from Mexico who live within 45 miles of the border to pay in-state tuition at eligible community colleges. This five-year pilot program begins this year. 

Questions About How These New California Laws Impact You? We Have Answers.

These new changes have broad implications for many California residents and businesses. If you have questions about how they impact you, contact the experienced legal team at Hoffman & Forde. We specialize in immigration law, real estate, administrative law, and more and can help you successfully navigate these changes.  

California Caps Security Deposits at One (1) Month’s Rent

Posted on January 3, 2024 by - Landlord/Tenant

In November Governor Newsome signed into law California legislation which limits security deposits to one (1) month’s rent for both furnished and unfurnished residential units. The new cap on security deposits for Leases takes effect July 1, 2024.

San Francisco Assembly person Matt Haney authored AB 12, which passed both the Senate and the Assembly houses in September. The legislation is a monumental shift from existing law, which allows up to two (2) months’ rent as security for an unfurnished unit and up to three (3) months’ rent for a furnished rental.

There is a major primary exception to AB 12. The law excludes landlords who own up to two (2) residential rental properties – which collectively include up to four (4) dwelling units offered for rent.  To qualify under the “limited number of units” exception, the owner must hold the property as (a) a natural person, (b) a limited liability company – in which all members are natural persons, or (c) under a family trust. If one satisfies these conditions, a “limited number of units” Owner is permitted to collect up to two (2) months’ rent as a security deposit.

As always, there is an exception – to the exception of every Rule. The “limited number of units” exception does not apply when the prospective tenant is a military service member.

Once again, the Law takes effect next Summer on July 1, 2024, which provides landlords time to make the necessary adjustments.

Contact one of our seasoned Landlord-Tenant Attorney’s to determine how California’s latest legislation impacts you.

 

12 Common Mistakes Landlords Make in California and How to Avoid Them

Posted on December 13, 2023 by - Landlord/Tenant

Rentals can provide a good income stream but can become costly if improperly handled. Here are some of the most common mistakes landlords make that can lead to severe problems.

1. Poor Tenant Screening

Good tenants pay their rent on time, keep your property in good condition, and don’t cause you any trouble. Bad tenants do just the opposite, and they can make your life as a landlord miserable.

To avoid problems with unpaid rent, disputes, legal issues, or property damage, your best defense is to do a thorough tenant screening that includes a background check, and employment and income verification.

2. No Written Rental Agreements

Relying on a verbal agreement is one of the most common mistakes landlords make. Not having a written contract makes you highly vulnerable to serious disputes or costly legal issues.

Take the time to prepare a written agreement outlining both parties’ rights and responsibilities. You won’t regret it.

3. Not Keeping up With Laws That Have Changed

Letting your knowledge of rental laws and their ever-changing iterations lapse can land you in legal trouble.

Laws on rental properties can change quickly in California, and it’s up to you to ensure you’re keeping up with them and remaining in compliance.

4. Not Paying Attention to Local Rent Control Ordinances

Does your city have a local rent control ordinance that protects tenants from excessive rent increases? Many cities do, especially in California, and you could land in some serious hot water if you start charging too much rent.

Stay informed at all times to ensure you’re in compliance.

5. Lack of Good Property Maintenance

A deteriorating rental property with unaddressed repairs is more than unsightly; it can lead to potential legal issues.

Ensure you have a proactive maintenance plan and regular inspections to address problems promptly. Your tenants will be happy, and you’ll be protecting your investment.

6. Poor Communication With Tenants

Without a clear line of communication between a landlord and tenants, conflicts and legal disputes can quickly arise. 

Open and transparent communication can foster a positive relationship to prevent misunderstandings and proactively address issues. 

7. Mismanagement of Security Deposits

Disputes over security deposits can get costly and are a financial loss that can be easily avoided.

In California, there are specific guidelines that landlords must follow when they handle security deposits. This includes:

  • Written notices to tenants about the amount being held
  • Returning deposits within the required timeframe
  • Documenting deductions

8. Not Complying With Habitability Requirements

If your rental has mold, pests, or other issues that make it inhabitable, you need to address these problems quickly. There are strict health and safety standards in California you must follow.

To avoid getting to the point where you’re facing legal consequences, ensure you are performing regular inspections and keeping up with California’s habitability laws.

9. Insufficient Insurance Coverage

Is standard insurance coverage enough for a rental property? It likely isn’t. You need to have enough coverage to protect you in property damage cases, personal injury claims, or loss of rental income.

Consult with an insurance expert. They can help you understand your options for coverage and assist you in selecting the right policy.

10. Discriminatory Practices

California’s fair housing laws strictly prohibit landlords from engaging in discriminatory practices. Protected characteristics include, among others, race, color, religion, sex, disability, and familial status.

As a landlord, you must know the fair housing laws and follow them accordingly.

11. Not Keeping Accurate Records

Poor recordkeeping isn’t just a mess. It can prevent you from collecting rent promptly, keeping up with maintenance and repairs, and ensuring legal compliance.

It’s critical to have an organized, systematic process for keeping records. 

12. Not Handling Evictions Correctly

Landlords must follow strict laws in California when evicting a tenant. You must:

  • Give proper notice
  • File the correct documents
  • Go through appropriate court procedures

Noncompliance can result in costly legal complications that can quickly drain your money. Before going through with an eviction, it’s critical to consult with an attorney.

Need Legal Advice?

Avoiding these common mistakes will help ensure your rental remains a solid investment. For legal matters, if you’re struggling to understand the laws you need to comply with or are in the midst of a dispute with a tenant, our attorneys can help. Schedule a consultation today.

LLC vs. Corporation in California: Which One Should You Choose?

Posted on December 6, 2023 by - Business Consulting

You want to start a new business, which is exciting. But what type of structure is best? In California, like in other states, you can form an LLC or set up a corporation. Here are some of the differences between the two.

Limited Liability Company (LLC)

Typically, an LLC is run by business owners but can also be structured where a manager is responsible for daily operations rather than the owners. Small businesses, startups, and single-owner businesses are good fits for this type of structure.

The Advantages

An LLC is an entity separate from the business owners (members). This structure provides owners with liability protection to shield their assets from business debts and obligations. The risk of loss is limited to what the owners invested in the business.

Other advantages of forming an LLC include:

  • Perpetual existence (the business can remain in existence even if ownership changes)
  • Flexible management structure
  • Pass-through taxation that avoids double taxation (LLCs, as an entity, are not subject to taxation; tax obligations are passed down to members on their personal income tax returns)

The Disadvantages

An LLC can cost more than a sole proprietorship or general partnership. There’s an initial fee to form the LLC and ongoing expenses at the state level. In California, for example, there’s an $800 annual fee.

Transferring ownership of an LLC can also be more complex than transferring ownership of a corporation, where buying and selling shares of stock determine ownership.

How to File for an LLC Formation in California

Filing is handled through the Secretary of State. You’ll need to file an Operating Agreement – which outlines your company’s operations, management, and ownership structure.

Corporation

In a corporation, you’ll have shareholders, a board of directors, and officers such as CEOs and CFOs.

There are two main types of corporations – a C corporation and an S corporation. A C corporation is responsible for paying taxes on its profits. Shareholders also pay taxes on dividends they receive. An S corporation has pass-through taxation, similar to an LLC. It comes with limitations, though, such as the number and type of allowed shareholders.

The Advantages

A corporation provides personal asset liability protection that protects owners from the company’s debts or legal obligations. 

Other advantages include:

  • Access to capital (you can raise funds by selling stock)
  • Tax breaks available to corporations
  • Business perpetuity

The Disadvantages

Corporations can get bogged down in legal and regulatory requirements that can become time-consuming and costly. Recordkeeping can become a bear.

Double taxation comes into play when you form a corporation. The corporation is taxed and shareholders are also taxed on dividends.

How to File to Become a Corporation

To form a corporation in California, you must file for Articles of Incorporation with the Secretary of State. 

How to Choose the Right Structure

When deciding between an LLC and a Corporation, you’ll want to consult with a knowledgeable business attorney who can help you consider the following factors:

  • Liability Protection: Both structures offer liability protection, but the formalities and management styles differ.
  • Tax Implications: Evaluate how the business structure’s taxation aligns with your financial goals and the nature of your business.
  • Business Goals: Assess your long-term objectives, growth plans, and exit strategy to determine which structure better suits your needs.
  • Complexity and Formalities: Consider each structure’s administrative requirements and ongoing compliance obligations.

Making an informed decision now can set the foundation for your company’s success and mitigate potential challenges in the future.

Meet With a Business Attorney

At Hoffman & Forde, we provide business and legal guidance for business formation and more. To meet with one of our experienced business attorneys, contact our office to book an appointment.

Recent Regulations for Short-Term Rentals in Chula Vista

Posted on November 21, 2023 by - Landlord/Tenant

Short-term rentals, supported by online platforms such as Airbnb, have long been controversial. Travelers love them because they are often more affordable than hotels and give a sense of staying in a unique “home away from home.” However, they are not without their problems, and locals tend to look down on them. As their popularity has exploded, city governments have sought ways to rein them.

To this effect, the city of Chula Vista introduced a new set of regulations for short-term rentals that went into effect in 2022.

Background

City officials recognized that STRs bring some significant benefits to the community. They allow residents to earn supplemental income, generate tax revenue, and bring visitors to Chula Vista that might otherwise stay in other parts of the San Diego metropolitan area. Despite this, they identified several areas of concern.

1. STRs can change the character of neighborhoods

STRs essentially turn houses and apartments into hotels, which can negatively affect neighbors. STR guests come and go at all hours, make more noise, generate more trash, and occasionally throw big parties on the property. Beyond this, significant portions of neighborhoods can be taken up with STRs to the point where permanent residents are in the minority.

2. Housing shortages

There is a severe shortage of housing in California cities. Renting out homes to short-term guests takes them off the market for residents. This squeezes the housing supply even more, driving up rental prices for everyone.

3. STR operators were not paying taxes

Existing law already required STR operators to register with the city and to collect and pay a Transient Occupancy Tax (TOT) based on their revenue. Reviewing the situation, the city determined that, of approximately 350 STR operating within Chula Vista in 2021, only 125 were registered and paying taxes to the city.

The New Rules

In response to these concerns, Chula Vista passed an ordinance to limit the proliferation of short-term rentals and bolster enforcement of existing provisions. Here are some of the most important new regulations.

  • All STRs require a permit from the city
    On top of needing a business license, STR operators must receive a permit for each property. These permits must be renewed annually.
  • The permit applicant must reside within Chula Vista
    STR operators must have their primary residence within the city limits. “Primary residence” means they live there at least 275 days a year.
  • No more than two permits per operator
    Each person may get a permit to rent out their primary residence and one non-primary residence.
  • Rules on operation
    The law has various regulations on how STRs must be operated. This includes a mandatory quiet time from 10:00 p.m. to 9:00 a.m., prominently displaying the operator’s business license, and promptly hauling away garbage.
  • Special permits for large events
    Before allowing the STR to be used for a large event, the operator must get a Short-Term Rental Event Permit. A maximum of 12 such permits will be granted annually for each STR.
  • Hosting platforms must collect taxes
    Platforms like Airbnb must automatically collect the Transient Occupancy Tax and remit it to the city.
  • De-listing noncompliant STRs
    Upon notice from the city that the property does not have a permit, hosting platforms must take down listings.

Get Help with Your Short-Term Rental

The Chula Vista Short-Term Rentals Ordinance is a comprehensive law that sets out many new requirements for STR operators. To successfully obtain a permit and avoid costly fines, you will need to understand all of these rules and navigate a complicated bureaucracy. 

Our attorneys have years of experience in the fields of business and real estate, and can help you keep your short-term rental business on the right side of the law. To schedule a consultation, contact our office today.

Understanding HOA Disputes in California: Common Issues and Solutions

Posted on November 15, 2023 by - Landlord/Tenant

It’s curious how something so innocuous-sounding as a homeowner association can be so provocative. Yet, mentioning an HOA is enough to throw some people into a frenzy. For them, the HOA is antithetical to the idea that people should be able to use their property however they see fit. Of course, HOA advocates would quickly point out that they are communal organizations that exist for the benefit of all the members, primarily by maintaining common areas and enforcing community standards that affect everyone’s property values.

With these contrasting positions, it’s easy to see how disputes can arise. Here are some of the most common issues that occur with HOAs and ways to resolve them.

Common Types of Disputes

1. Rejection of Architectural Plans

Depending on the Covenants, Conditions, and Restrictions (CCRs) of your HOA, new construction or renovations to the exterior of your home may be subject to the approval of the HOA. Having your carefully considered architecture plans rejected can be pretty frustrating, and it may seem as though the board is being inconsistent or over-controlling.

2. Imposition of Fines

HOA bylaws often allow the board to impose fines on members who fail to abide by the CCRs. On the one hand, the HOA does need to have teeth to enforce the community standards. On the other hand, some boards can get carried away with this, primarily when enforcement is managed by a private company that may have a financial incentive for collecting fines.

3. Failure of the Board to Perform Its Duties

HOA boards have several important duties. They may be responsible for maintaining public areas such as parks and playgrounds and paying property taxes for those lands. If the roads are privately owned, the HOA is likely responsible for their upkeep. Failure to do these things can create problems and even lead to legal action.

4. Misuse of HOA Funds

A homeowner association has a fiduciary duty to its members, and board members must, therefore, use the HOA’s money in a fiscally responsible way. Embezzling money would violate this duty, but things like granting HOA contracts to a board member’s family business or just being wasteful could also be violations.

Resolving Problems with the HOA

The best place to start when resolving an HOA issue is to do so informally; that is, just talk to the board members and/or homeowner without escalating the situation. After all, these people are your neighbors, so it’s better to get along with them as much as possible. Bring up your concerns and try to find common ground.

If that doesn’t work, the next step may be mediation or alternative dispute resolution. Mediation can be quite effective and is usually much quicker and cheaper than going to court. If you are a homeowner in dispute with the HOA, it’s probably best to consult with an attorney; the HOA likely already has a lawyer on retainer that will be present for the proceedings. 

If mediation does not resolve the problem, the only remaining recourse is to go to court. To go this route, you will want an attorney, and you should be prepared for a process that can take months or even years to finish.

Talk to an HOA Attorney

HOA disputes can be complex to resolve and often quite emotional as well. Meeting with an experienced HOA attorney will help you better understand your situation and protect your rights as a homeowner.

Our residential real estate attorneys have a deep understanding of this area of law and know how to bring HOA disputes to a fair resolution. Contact our office to schedule a consultation.