CA SB1238

Expands the definition of "agent" in Civil Code to include any person or company providing HOA management services under Sections 5300, 5310, and 5500, requiring them to provide fiduciary duty to the board and association members

Prohibits HOA boards from using reserve funds for litigation, legal services, or threatening litigation against any real property owner of record or their relatives who are association members

Requires HOA management companies to provide prospective purchasers with separate disclosures about exterior elements and balconies needing imminent repairs, including the number of units affected and repair cost thresholds of $10,000 or more

Mandates that reserve studies conducted every three years must incorporate repairs identified in the nine-year exterior elevated element inspections required under Section 5551, with inspection reports categorizing repair urgency (immediate, within one year, one to four years, or no repair needed)

Requires disclosure to prospective purchasers and mortgage lenders regarding whether CC&Rs require individual unit owners to maintain exterior elements, whether reserve studies include minimum 10% annual allocation for exterior repairs, and whether reserve studies have been updated to reflect balcony inspection findings