Homeowner Associations, Private Attorney General, Section 1717: Defendant Homeowners Winning A Tree Dispute With Another Homeowner Neighbor Rightfully Denied Attorney’s Fees Under CC&Rs, Civil Code Section 1717, And Private Attorney General Statute

However, A Dissenting Justice Would Have Found Fee Entitlement Under CC&Rs And Section 1717.

           The next case, Shah v. Ross, Case No. B286783 (2d Dist., Div. 5 April 25, 2019) (unpublished), involved a situation where defendants/homeowner neighbors won a tree dispute initiated by fellow plaintiff homeowner. Defendants then sought fees under a CC&Rs fees clause, Civil Code section 1717 mutuality principles, and the private attorney general statute (CCP § 1021.5). The trial judge denied fees on all bases.

            A 2-1 majority of the 2/5 DCA affirmed, with a lengthy dissent by Presiding Justice Rubin.

            On a preliminary basis, the appellate court determined that the lack of a reporter’s transcript of the fee motion did not impede review because only legal construction of fee or statutory entitlement provisions was involved.

            The majority found that the CC&Rs fees clause did not apply to disputes between homeowners, but only a where the HOA was involved. They saw no reason to disturb reasoning to the same effect in Mount Olympus Property Owners Assn. v. Shpirt, 59 Cal.App.4^th 885, 893, 896 (1997). Section 1717 did not afford relief because mutuality only applied where there were putative persons who could be impacted by the fees clause, which was not the case. Finally, the private attorney general statute request properly was denied because the winning parties were vindicating their private interests in preventing a blocking of views by trees.

            Justice Rubin, in an 18-page dissent, believed that the CC&Rs were ambiguous such that fees were allowable in inter se homeowner disputes because certain provisions needed to be read together and other provisions where only the HOA was mentioned made no sense such that homeowner disputes had to be included within the ambit of the CC&Rs fees clause. He also did not like the analysis in Shpirt, which he felt was based on incomplete reasoning such that a “clean slate” approach was warranted. Lastly, Justice Rubin engaged in a section 1717 analysis by which he determined that it should be applied in this particular context based on amendments to the “parties” language in the statute some time ago.