Actions Involved Enforcement of CC&Rs, With Trial Court Reasonably Awarding a Lodestar Amount After Reductions.
Yet again, we have a homeowner-HOA dispute resulting in substantial fee awards against a homeowner and in favor of two set of defendants. Seltzer v. Eugene Burger Management Assn., Case No. A128552 (1st Dist., Div. 3 Oct. 19, 2011) (unpublished) provides a warning to liitgants in homeowner-HOA disputes that clear prevailing parties will obtain fees, and they can be substantial (and crippling) in nature–resulting in financial ruin for homeowners and resulting in increased assessments for losing HOAs.
Basically, homeowner sued for CC&R violations, and HOA cross-complained for delinquent assessments and homeowner’s violation of unauthorized building modifications. Homeowner lost against non-HOA/HOA defendants, and HOA won over $50,000 for unpaid homeowner assessments. Subsequently, the lower court awarded $304,464.63 in fees to defendants and HOA $236,976 in attorney’s fees under Civil Code section 1354 (which allows for fee shifting to the prevailing party in a suit to enforce CC&Rs). An appeal followed
Homeowner lost her appeal of the fee awards.
The main reason was that the record clearly showed both her complaint and HOA’s complaint involved enforcement of the CC&Rs, with HOA also entitled to fees for collecting delinquent assessments under Civil Code section 1366(e)(1) even if section 1354 was a wrong entitlement predicate. The trial court also made significant reductions in the fee requests by the requesting parties, including a 25% reduction of HOA’s request primarily for “over litigating” the case. No abuse of discretion in this one.