Cases: Homeowner Associations
November 15, 2012
August 28, 2012
August 18, 2012
August 03, 2012
Allocation/Homeowner Associations: HOA Members Losing HOA Interest In Foreclosure Action Had To Bear Fee Exposure To HOA
Apportionment Not Required.
Weiss v. Citrus Heights, LLC, Case No. D058614 (4th Dist., Div. 1 Aug. 2, 2012) (unpublished) is yet a stark reminder in these economic times of fee exposure that can be visited upon foreclosed owners of homeowner association interests.The Jumbo Lemon. 1925.In this one, homeowners in an HOA lost a controversy on who was responsible to maintain a sewer system in the common interest development. However, homeowners lost their unit to a nonjudicial foreclosure. Usually (and it was ultimately determined), this meant homeowners also lost any ability to continue the litigation dispute.HOA was awarded $60,610 (out of a requested $66,414) in attorney’s fees based on CCP § 1354(c) and a fee-shifting provision of the CC&Rs. Homeowners argued that the trial court should have allocated fees between HOA work and work incurred in prosecuting a cross-complaint against the developers and City of Escondido.Because entitlement was not at issue, only the appropriateness of apportionment was really at hand for determination. The HOA’s attorney declaration demonstrated why all the work should be included, credible enough to support the determination to not apportion. Fee award to HOA affirmed.
June 29, 2012
June 15, 2012
May 17, 2012
April 20, 2012
March 14, 2012
Homeowner Associations/Mediation/Substantiation Of Fees: Homeowner Hit With Fee Recovery For Failing To Satisfy Mediation Condition Precedent In Settlement Agreement With HOA
$58,212 Was the Fee Price Tag for Noncompliance With Mediation Condition Precedent.
Usually, we see what happened in the next case occurring instead under California Association of Realtor (CAR) sale/purchase form contracts, which have attorney’s fees clauses that are conditioned upon one or both parties attempting to mediate a dispute before resorting to arbitration/litigation. In the next case, a settlement agreement between HOA and homeowner stemming from a mold/water intrusion prior dispute dictated that homeowner pursue mediation first before resorting to the courts. She did not, suffering an adverse fee award in favor of HOA.In Adams v. Newport Crest Homeowners Assn., Case No. G044230 (4th Dist., Div. 3 Mar. 13, 2012) (unpublished), homeowner wanted to enforce the settlement agreement but not the part that indicated she should pursue mediation first. That was a big mistake, because the trial court granted the defense motion to enforce the settlement agreement--inclusive of the mediation condition precedent--and awarded it $58,212 (out of a requested $63,380) in attorney’s fees for prevailing on the motion to enforce under the settlement agreement fees clause.Justice Moore, writing for a 3-0 panel of our local Santa Ana appellate court, affirmed. The settlement agreement fees clause was broad, applying to “any dispute” concerning an obligation under the settlement agreement lost by homeowner. Entitlement established. Next, this was no interim resolution, but a final resolution of the proceedings at stake in the same litigation, with HOA meeting its objective to prevent homeowner from suing by leapfrogging the mediation process. (Don’t you just love that word, leapfrogging?) The amount of the fee award was adequately documented using very reasonable rates ($170 per hour), with HOA doing something smart off the bat--it only requested $63,380 in fees although documenting over $81,000. That gave HOA increased credibility when it came to having its fee petition reviewed both before the trial and appellate courts.BLOG UNDERVIEW--Leapfrog derives from a children’s game dating back to the 1590s--and we know that you get a mental picture of how that game was played!
Children playing “leapfrog” in Harlem circa 1930. Wikimedia Commons.
December 12, 2011
December 07, 2011
Homeowners Association: $20,000 Fee Award To Neighbors In Surveillance Camera Dispute Affirmed Based On Breach Of Settlement Agreement Fee Clause
Entitlement and Breach Were Established.
Well, whether the Holidays or not, neighborhood disputes in common area developments always produce interesting results--often times with someone bearing the sting of fees as the losing parties or both parties walking away after incurring lots of fees. The former was the case in Toler v. LeFevre,Case No. A130010 (1st Dist., Div. 4 Dec. 6, 2011) (unpublished).There, neighboring litigants in a common area development located in American Canyon, CA entered into a settlement agreement about the proper positioning of a surveillance camera by plaintiff after defendants alleged in a related action that plaintiff could view directly into private and common areas of the development. The settlement agreement required shielding of the camera, and contained a fees clause indicating that previously-filed fee motions by defendants could be reinstated if plaintiff materially breached the settlement agreement.Not long after the settlement was reached, defendants claimed that there was a material breach in not shielding the camera by plaintiff, which led to protracted proceedings to establish what was what. Eventually, the trial court established that there was a material breach of the settlement by plaintiff, awarding defendants $20,000 in attorney’s fees under Civil Code section 1354(a) [allowing for recovery of fees in CC&Rs enforcement disputes].The Court of Appeal affirmed, after finding that there was substantial evidence supporting plaintiff’s breach. Plaintiff did not dispute entitlement, but only that there was no breach. With the breach being established, the fee award was affirmed on appeal.BLOG UNDERVIEW--Where is American Canyon? Looks like it is south Napa County, and was formerly known as Napa Junction--part of the San Francisco Bay area.
November 14, 2011
October 20, 2011
August 02, 2011
March 26, 2011
March 24, 2011
March 18, 2011
March 12, 2011
February 02, 2011
February 01, 2011
Homeowners Association/Standard Of Review/Allocation/Substantiation of Fees: Substantial Cross-Fee Awards Affirmed Across The Board In Acrimonious Tree View Dispute
Second District, Division 1 Finds No Abuse of Discretion in Various Fee Awards.
It is amazing how ocean views, privacy, and trees all seem to be in the mix of many neighbor/homeowner association disputes. The next one is no exception, producing substantial cross-fee awards under Civil Code section 1354 that probably only made the lawyers happy participants in the overall controversy.Murrell v. Rollings Hill Community Assn., Case Nos. B202019/204632 (2d Dist., Div. 1 Jan. 31, 2011) (unpublished) opens with this nice summarizing paragraph: “A contentious and costly feud over trees and a neighbor’s view has spawned multiple legal actions, cross-actions, five appeals and two cross-appeals. George and Anne-Merelie Murrell and Leonard and Linda Fuller are neighbors on adjacent residential lots overlooking the Pacific Ocean in the city of Rolling Hills. To obtain an unobstructed ocean view, the Fullers wanted certain trees on ‘the Murrell property’ trimmed or removed. The Murrells, who sought to preserve privacy, resisted. So began the decade-plus dispute now before this court [which also included the Rolling Hills Community Association and a volunteer HOA director].”Boy sitting on pine tree. Maginel Wright Barney. Library of Congress.Except for the director, the Murrells, Fullers, and HOA got mixed results, but results that a referee and trial court could parse out to make the following fee awards: (1) $399,930.88 (out of a requested $647,974.25) in fees to the Murrells and against HOA, but with HOA obtaining $159,148.84 (out of a requested $237,053) in fees against Murrells on a pine tree claim; and (2) $333,525 (out of a requested $488,906.69) in fees to the Fullers and against the Murrells. The Murrells and HOA appealed the various fee awards and various merits rulings.Presiding Justice Mallano, in a 63 page unpublished opinion on behalf of a 2-1 panel, affirmed across the board. (The dissenting justice did not agree with some merits adjudications and one particular fee award.)The $159,148.84 fee award to HOA did not surmount the deferential abuse of discretion review standard. (PLCM Group, Inc. v. Drexler, 22 Cal.4th 1084, 1095 (2000) [one of our Leading Cases].) Although a different judge decided a fee request than the judge presiding over germane matters, the Murrells failed to cite authority as to why de novo review was warranted under the circumstances The trial court even apportioned out noncompensable work from compensable work, with the Murrells failing to pinpoint what aspects of the apportionment were wrong. A moving declaration authenticating time records was competent substantiation of the work expended, and a $250 hourly rate for one associate was found to be proper. Other challenges to generalized charges were forfeited by the Murrells’ failure to provide citations to the specifics.The Murrells were not any more successful on their challenges to the $333,525 fee award to the Fullers and to the inadequacy of the $399,930.88 fee award to them. A referee was appointed and made proper calculations of what fees should be recovered by each side. Some hourly rates were pared down correctly by the referee because the moving party failed to present evidence of what attorneys were paid in the downtown L.A. market. The apportionment used by the referee and trial court, which is applicable to section 1354 fee awards, was no abuse of discretion given the overlapping nature of the various claims. Again, the generalized attacks of reasonableness by the Murrells did not meet their burden of challenging the fee award to the Fullers. (Farber v. Bay View Terrace Homeowners Assn., 141 Cal.App.4th 1007, 1015-1016 (2006).)Finally, on a costs issue, the appellate court majority ruled that Civil Code section 1354 does not allow recovery of costs not authorized under Code of Civil Procedure section 1032, such as phone charges, copying charges, and expert witness expenses.Putting into perspective the social utility of $400,000 in attorney’s fees spent on a neighbor tree view dispute, we note in passing that $400,000 will buy 26,667 doses of flu vaccine at $15/dose, 6,667 doses of malaria vaccine, at $60/dose, and 50,000 meals on wheels, at $8/meal; and, that in 2009, median household income in the United States was $49,777, an amount that has since declined.
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November 22, 2010
October 02, 2010
August 18, 2010
August 04, 2010
August 01, 2010
July 02, 2010
June 12, 2010
Homeowners Associations: Justice Fybel Provides A Great Quote Regarding Fees Often Times Spent By Both Sides In These Disputes
Quote Comes from 2002 Unpublished Opinion.
We would like to thank Justice Richard Fybel of the Fourth District, Division 3 for a great quote from a prior unpublished opinion involving a homeowner association-property owner dispute.In Niguel Shores Community Association v. Buehler,2002 WL 31121089 (4th Dist., Div. 3 Sept. 25, 2002), both sides spent over a combined $220,000 in attorney’s fees after several years of acrimonious litigation over whether property’s home construction deviated from approved plans. Here is how he described this $220,000+ fee expenditure—“enough in many parts of the world to build an entire home or even a small town.” True, true.Above: Valley of Senegal. c1900-1910. Village scene withoxcarts. Library of Congress.Although both sides appealed the fee determination, it was affirmed on appeal. The trial court had actually erred in failing to apply the proper lodestar analysis, but the appellate court applied the doctrine of estoppel in affirming because the homeowner association griping about the lowness of its actual $10,000 fee award failed to cite the lower court to the proper lodestar principles.Association also argued that an award of 20% or less of fees was a per se abuse of discretion, relying on Deane Gardenhome Assn. v. Denktas, 13 Cal.App.4th 1394 (1993) and Hadley v. Krepel, 167 Cal.App.3d 677 (1985). However, the Fourth District, Division 3 found these results were dependent on different circumstances, with neither decision establishing a per se threshold for determination of reasonable fee amounts.Thanks for a great quote, Justice Fybel.BLOG UNDERVIEW—Niguel Shores Community Association is located in South Orange County, which seems to draw a fair amount of the homeowner association-property owner disputes over fees. Deane Gardenhome was authored by (now) Retired Justice Wallin, with the decision containing the famous “fees being the tail that wags the litigation dog” quote that we showcase in our blog’s Mission Statement.
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May 29, 2010
April 05, 2010
March 25, 2010
Homeowners Association Awards: Homeowner’s Success In Obtaining Permanent Injunction And Limited Restitution Entitled Him To Routine Costs Award Against HOA
Trial Court Properly Denied Fee to Either Side, Says Court of Appeal.
Don’t assume that the prevailing party determination for an award of routine costs and attorney’s fees under Civil Code section 1717/fee-shifting statutes is the same. They do differ, as the next case demonstrates.In Duclos v. Marina Pacifica Homeowners Assn., Inc.,Case Nos. B213053/214116 (2d Dist., Div. 7 Mar. 25, 2010) (unpublished), Long Beach HOA and homeowner each won pieces of a special assessments donnybrook contest. HOA won summary adjudication on five claims, but homeowner won a bench trial on two claims by which he was awarded a permanent injunction and limited restitution of $7,500. The trial court denied homeowner his routine litigation costs and also denied HOA its attorney’s fee request. Each side appealed.The appellate panel affirmed everything except reversing the part of the orders by which routine costs were denied to homeowner.Homeowner did recover $7,500 in limited restitution, which was a “net monetary recovery” entitling him to litigation costs as matter of right. (See, e.g., Michell v. Olick, 49 Cal.App.4th 1194, 1198 (1996) [statutory directive of Code of Civil Procedure section 1032 is clear even though plaintiff prevailed on a single, insignificant claim among several unrelated and unmeritorious claims]; Chinn v. KMR Property Mgt., 166 Cal.App.4th 175, 188 (2008).) HOA alternatively argued that no costs should be allowed because homeowner could have obtained this award in a limited civil court case, which allowed the trial court discretion to deny costs. (Code Civ. Proc., § 1033(a).) The problem with that argument is that a permanent injunction cannot be obtained in a limited civil case, such that the provision was inapplicable. (Ytuarte v. Superior Court, 129 Cal.App.4th266, 275 (2005).)That brought the Court of Appeal to HOA’s claim that it should have been awarded attorney’s fees. At the outset, the trial court does have broad discretion to determine there was no prevailing party under Civil Code section 1717 when there was good news and bad news for both parties—as was the case here. (Ajaxo Inc. v. E*Trade Group, Inc., 135 Cal.App.4th 21, 58 (2005).)HOA argued that Civil Code section 1354 entitled it to fees for enforcing governing documents (such as CC&Rs) against homeowners. However, homeowner actually prevailed on the governing document claims, with HOA only prevailing on a Davis-Stirling Common Interest Development Act enforcement claim (not an enforcement claim based on the governing documents). So, no dice to the fee arguments raised by HOA.BLOG FAVORITE QUOTE BY THE TRIAL COURT—“This has become a fool’s errand that, although I’ve thrown some things out hoping that peace would break out, if your client is adamant he wants a merits ruling on this, he’ll get a merits ruling.”
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