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December 2018

Summary Judgment Granted In Heavily Disputed Homeowners Association Case

Gordon Rees Scully Mansukhani Partners Craig Mariam and John Fraher along with Senior Counsel Scott McCaskill obtained summary judgment in favor of their client, a homeowner’s association (“HOA”) located in Newport Beach, California, and against two members of the association who violated the Covenants, Conditions & Restrictions (“CC&Rs”) of the HOA.

In particular, the two members submitted an application to modify the footprint of their rear yard wall in 2013. However, the application was rejected, as the wall would impermissibly encroach on a slope control area maintained by the Association. Not to be dissuaded, the members waited a year and in 2014 began construction anyway, demolishing portions of existing walls. Shortly thereafter, the members were served a cease and desist letter and requested to return their rear yard wall to its pre-construction condition. However, the members refused to do so, and instead submitted multiple applications for the rear yard wall that were each rejected as failing to conform to the requirements set forth in the CC&Rs and governing documents.

As a result, the Association filed suit against the members for Breach of Covenant, Injunctive Relief, and Declaratory Relief.  In turn, the members cross-complained against the Association claiming Breach of Covenant, Violation of Civil Code Section 4765 [requires architectural decisions of HOAs to be “reasonable”] and requesting Declaratory Relief, which Gordon & Rees defended. In relation to same, a summary judgment motion was filed on behalf of the Association as cross-defendant by Gordon & Rees. 

On November 30, 2018, the Orange County Superior Court granted the motion for summary judgment finding: (1) the members had failed to perform under the CC&Rs due to their unauthorized construction and therefore failed to meet the elements necessary to assert a breach of contract claim; (2) the members failed to show the HOA’s denial of their applications were not reasonable, and therefore the Civil Code claim failed; and, (3) the claim for declaratory relief was obviated by the Court’s ruling on the other causes of action.

Due the machinations of counsel for the members, the HOA was forced to engage in protracted discovery meet and confer efforts, that were ultimately resolved in favor of the HOA, but required expenditure of enormous amounts of time and effort. Gordon & Rees is seeking to recover attorney’s fees as allowed under statute in relation to HOA enforcement actions. 

John B. Fraher
Craig J. Mariam
Scott W. McCaskill