Using reserve funds for litigation
- Statute:
- California §5520 · Chapter CIV-7 (Davis-Stirling Act Ch. 7 — Finances and Reserves)
- Topic:
- Assessments & Finance · Litigation reserves
- Applies to:
- HOA associations
If reserve funds are used to pay for litigation, the association must notify members of that use in the next available mailing, and must identify the litigation in the reserve funding plan as required.
📄 Read the official text at leginfo.legislature.ca.gov →
How SoShiny helps with Using reserve funds for litigation
SoShiny calculates per-unit assessments automatically from ownership percentages and tracks payment status against every levy. The unit-level ledger is the audit trail your CPA, attorney, and the board need when an owner disputes a charge.
See the feature → Start freeFrequently asked
- What does California §5520 require?
- If reserve funds are used to pay for litigation, the association must notify members of that use in the next available mailing, and must identify the litigation in the reserve funding plan as required.
- Who does California §5520 apply to?
- California §5520 applies to HOA associations in California.
- What happens if our CID doesn't comply with §5520?
- Non-compliance can expose the association and individual directors to disputes in the governing forum for California community associations. SoShiny's audit trail and documented workflows are designed to demonstrate good-faith compliance.
- Where can I read the official text of California §5520?
- The official text is published by the California Legislature at leginfo.legislature.ca.gov. The summary on this page is for plain-English reference only and is not legal advice.
- How does SoShiny help with Using reserve funds for litigation?
- SoShiny calculates per-unit assessments automatically from ownership percentages and tracks payment status against every levy. The unit-level ledger is the audit trail your CPA, attorney, and the board need when an owner disputes a charge. Learn more →
Not legal advice. This page is a plain-English summary of California §5520 prepared by SoShiny for board members and managers. For binding legal advice or interpretation, consult a California-licensed attorney. For the official statutory text, see the link above.
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