Homeowner Associations, Private Attorney General: Lower Court Got It Right In Denying Fees To Homeowner And HOA Which Did Not Meet Their Main Litigation Objectives, And Homeowner Was Not Successful Party Or Provided A Significant Benefit Under CCP § 102

Ending Appellate Court Comment Urges Homeowners and HOAs To Work It Out, Rather Than Run To Court, Saying “Amen” To Trial Judge’s Closing Observation.

            In Artus v. Gramercy Tower Condominium Assn., Case No. A161265 (1^st Dist., Div. 2 Mar. 30, 2022) (published), a homeowner sued an HOA over election voting rules and sale/leasing guidelines.  Homeowner lost one claim on demurrer, a second claim on an anti-SLAPP motion, and dismissed three others as moot based on unilateral changes to rules/guidelines by the HOA.  Then, both sides moved for prevailing party fees under the Davis-Stirling fee shifting provision, with homeowner also claiming fees under the private attorney general statute; both sides asked for over $300,000 in fees.  They submitted 1,867 pages of fee proceeding paperwork, and then charts and 217 more pages when the trial judge asked for more information.  The trial judge denied both fee motions in a detailed ruling, prompting an appeal by both sides (who had been before the appellate court before in the same dispute).

            The 1/2 DCA affirmed.  It initially decided that the abuse of discretion standard applied, even as to entitlement, because there was no clear “winner take all” prevailing party.   With respect to homeowner’s Davis-Stirling fee request, homeowner only obtained one out of four of her litigation objectives, obtaining some changes by the HOA to some rules/guidelines (many of which were technical in nature).  On the HOA side, HOA did not achieve its objective to fight Dr. Artus forever as far telling it how to govern, even though it did unilaterally make changes—to make changes after fighting so hard was a difficult pill to swallow as far as showing it pragmatically prevailed.  Finally, on homeowner’s 1021.5 request, she was not “successful” and the changes made by HOA did not benefit a wide number of other HOA members. 

            However, the appellate court had to quote and endorse the trial judge’s ending observation in this closing part of its opinion:  “‘I’m aware that there has been a long history of disputes between Dr. Artus and this association, I’m trying to send a message here. And that message is, don’t run to court. Run to try to work things out. Both sides.” To that we say ‘Amen.’”