Lower Court Found HOA Did Not “Prevail,” Where Each Side Got Some Relief.
HOA-homeowner disputes, as well have seen repeatedly, are generally expensive in nature as far as attorney’s fees expenditures. The loser, either way, can face substantial fee exposure under Civil Code section 5975 (the Davis-Stirling Act’s fee shifting provision) and/or Civil Code section 1717 (where CC&Rs have attorney’s fees provisions, which most do). Sometimes, neither side gets fees given that a lower court has lots of discretion to determine that the fee claimant was not a “prevailing party” in light of a determination that neither side obtained the litigation objectives being sought for an “unqualified win” perspective. (Hsu v. Abbara, 9 Cal.4th 863, 876 (1995) [Civil Code section 1717]; Heather Farms Homeowners Assn. v. Robinson, 21 Cal.App.4th 1568, 1572-1574 (1994) [former Civil Code section 1354, now section 5975].)
HOA in Roslyn Lane, LLC v. Cave Street Homeowners Assn., Case No. D065134 (4th Dist., Div. 1 May 10, 2016) (unpublished) was unhappy and appealed after the trial court denied its request to recover $1,666,203.80 (no typo) in fees in a hard-fought architectural CC&R dispute. Its appeal could not surmount the deferential review standard accorded to a lower court’s “no prevailing party” determination below. The record showed HOA was awarded $161,613.01 in damages on its cross-complaint, while homeowner was awarded $117,121.60 in damages on its complaint (plus, homeowner obtained some declaratory relief victories and HOA was found to have violated several CC&Rs, ordered to accommodate several of homeowner’s architectural objectives). Homeowner, however, had asked for six times the damages ultimately awarded. Since neither party achieved its litigation objectives, the “split” nature of the end result justified the lower court finding that no side “prevailed” under Civil Code sections 1717 or 5975.