- Consumer Privacy: Changes to the Consumer Privacy Protection Act (“CCPA”) and other privacy laws. Assembly Bill 25 exempts CCPA information collected from employees and independent contractors for one year; this exemption terminates on December 31, 2020. However, the obligation to inform the consumer as to the categories of personal information that is collected will still go into effect on January 1, 2020 and failure to provide that information can be the basis for a private civil action. Other new laws concerning Consumer Privacy:
A. Assembly Bill 874: Broadens the public information exemption for personal information (PI). The definition of “personal information” now excludes information that is publicly available regardless of whether the PI is then used for a purpose which is “not compatible” with the purpose for which the data is maintained.
B. Assembly Bill 1202: Creates a new category and registration requirement for “data brokers.” “Data brokers” are defined in the CCPA as businesses who knowingly collect and sell to third parties the personal information of a consumer with whom those businesses do not have a direct relationship. Data brokers will be required to register with the Attorney General.
C. Assembly Bill 11302: Expands the type of data subject to the Information Practices Act of 1977. Originally, “personal information” was defined as social security numbers, driver’s licenses and California identification cards; now “personal information” also includes tax identification numbers, passport numbers, military identification numbers, or other unique identification numbers issued on a government document that is commonly used to verify the identity of a specific individual. For this type of information, if held as computerized data, a business must implement and maintain reasonable security procedures and practices, and when a breach occurs, it is required to issue a specified security breach notification.
- Disclosure: Disclosure and point-of-sale compliance regarding wildfire defensible space and vegetation management laws, and home hardening. Assembly Bill 1202 requires delivery of a statutory disclosure regarding “home hardening” for homes located in designated high fire areas that are built before 2010. Sellers will be obligated to list specified retrofits and other measures undertaken by the Seller to “increase the likelihood of a structure to withstand ignition.” Government Code §51189 outlines “home hardening” measures.
Beginning January 1, 2020, if a Seller, after completion of construction, has obtained a final inspection report regarding compliance with, among other things, home hardening laws (Government Code §§51182 & 51189), the Seller shall deliver a copy of that report (or information on where a copy of the report may be obtained) to the Buyer.
Beginning January 1, 2021, if the Property is located in a high or very high fire hazard severity zones (i.e., as shown in the NHDS) for homes built before 2010, the Seller will be obligated to provide a statutory disclosure that includes information on how to fire harden homes. The required statutory language is as follows:
This home is located in a high or very high fire hazard severity zone and this home was built before the implementation of the Wildfire Urban Interface building codes which help to fire harden a home. To better protect your home from wildfire, you might need to consider improvements. Information on fire hardening, including current building standards and information on minimum annual vegetation management standards to protect homes from wildfires, can be obtained on the internet website: http://www.readyforwildfire.org”
In addition to this statutory warning language, the Seller will be obligated to disclose if the Seller has knowledge of the existence of certain features of the Property that may make it vulnerable to wildfires and flying embers. As currently drafted, the list includes untreated wood shingles, combustible landscaping within five feet of the structure and single-pane window glass windows.
Beginning July 1, 2021, if the Property is located in a designated high fire area (i.e., as shown in the NHDS), the Seller shall deliver documentation stating that the Property is in compliance with local law pertaining to defensible spaces (as defined in Public Resources Code §4291) or local vegetation management laws to the Buyer. If there is no local law, the Seller shall provide documentation of compliance with state law, assuming the Seller obtained such documentation within six (6) months of “entering into a transaction” (i.e, accepting a Purchase Agreement). If there is no local law and no documentation of compliance was obtained by the Seller within the 6-month period, the Seller and Buyer must enter into a written agreement in which the Buyer agrees to obtain documentation of compliance with defensible space or a local vegetation management ordinance after Close of Escrow.
NOTE: All of these new disclosure requirements will only apply if the Seller is obligated to complete the Transfer Disclosure Statement (“TDS”). If the Seller is exempt from completing the TDS (probate, bankruptcy, and sales of Property held in certain types of trusts) and/or the Property is not located in a designated high fire area, then these disclosures are not required.
If the disclosure is required, then the Buyer will have the same right to rescind as with the TDS if the fully completed TDS is delivered after the Offer is made: Three days if delivered personally or five days if delivered by mail or electronically.
Additional disclosure requirements on this topic will be going into effect starting on July 1, 2025.
- Sexual Harassment Training – deadline extended until January 1, 2021. The sexual harassment training deadline required for employers with five or more “employees” has been postponed until January 1, 2021.
- New Construction: Building Standards for Solar. Under prior legislation that goes into effect on January 1, 2020, installation of solar devices is a required mandate in the construction of all new homes. Assembly Bill 178 now allows for an exemption to the solar mandate until January 1, 2023 in areas where the Governor has declared a state of emergency. This exemption will allow low-income homeowners to rebuild their homes with the requirement that was in effect at the time their home was originally constructed.
- Insurance: 75-day notice of nonrenewal. Assembly Bill 1816 requires insurers to provide at least a 75-day notice of a nonrenewal of a homeowner’s insurance policy (currently 45 days) and raises the limit on a homeowner insurance claim covered by the California Insurance Guarantee Association (CIGA) to $1 million.
This law also allows insurers who voluntarily write policies for property in high fire hazard severity zone in the state responsibility area and very high fire hazard severity zone in local responsibility areas to be proportionately relieved of their responsibility to participate in the Fair Access to Insurance Requirements (FAIR) plan.
Clients who have questions about the changes in the Insurance Code should contact their own Insurance Broker for more information.
- TDS and NHDS Cleanup Legislation. Assembly Bill 892 revised Civil Code Sections 1102 and 1103 to clarify and confirm that delivery of the TDS and NHDS are generally not required for leases of any duration. However, the Agency Disclosure form is required for residential leases of more than one year. This revision also confirms that there is no cancellation right for a Buyer based upon delivery of the Buyer’s Agent’s visual inspection when purchasing from a Seller who is not represented by an Agent.
For information on the new laws affecting the legalization of Accessory Dwelling Units, see “Weekly Practice Tip: Accessory Dwelling Units.”
For information on the Rent Cap and Just Cause Eviction Law, see “Weekly Practice Tip: Rent Cap and Just Cause Addendum.”
For information on other new Landlord Tenant Laws, see “Weekly Practice Tip: New Landlord Tenant Laws for 2020 Other Than the Rent Cap and Just Cause Eviction Law.”
This Weekly Practice Tip is an attorney-client privileged document for the exclusive use of clients of Broker Risk Management and their agents. It may not be reproduced or distributed without the express written consent of Broker Risk Management. The advice and recommendations contained herein are not necessarily indicative of standards of care in the industry, but rather are intended to suggest good risk management practices.
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