HOA Lawyer Blog

Homeowners Compelled to Submit to Hoarding Inspections by HOA

Published on: March 11, 2011 | by Steven J. Tinnelly, Esq.

Laguna Woods’ United Mutual HOA board voted unanimously this month to adopt a policy to compel residents suspected of hoarding to allow the association to inspect their home.

In the wake of the policy’s adoption, the HOA’s board of directors sought to assure the association’s members that the policy would not be abused and that members would not be subject to the HOA “breaking down” their doors.

The policy states that once a complaint is filed by one of the association’s members, an inspection would be ordered of the residence where the hoarding is suspected. The HOA board must first get the resident’s permission to enter the unit for the inspection. However, residents who refuse the inspections will be called to a disciplinary hearing before the board.

Homeowners Associations Saving Money with Solar Power

Published on: February 23, 2011 | by Steven J. Tinnelly, Esq.

The rough economic times have encouraged Homeowners Associations to look for ways to reduce their expenditures. In an effort to reduce electricity costs, some Homeowners Associations in Arizona are turning to solar power. An article published in the Arizona Republic highlights one such Homeowners Association, the Sunbird Golf Resort.

solar energy facts2.jpg
After learning that one owner within the Association was able to reduce his personal electricity expense to approximately $15.00/month by utilizing solar technology, Sunbird’s management became interested in exploring potential opportunities to utilize solar power for the Association at large.

The first application of solar power was the installation of solar-powered heating for the community swimming pool. This application was able to immediately reduce what had been a $26,000 annual expense for the Association.

The Association is now looking for ways to further expand its implementation of solar power, including powering their streetlights and clubhouse.

Homeowners Associations in California may want to explore the feasibility of implementing alternative energy within their communities. Some CC&Rs may restrict or prohibit these installations; however, any such restrictions flatly prohibiting solar panels are null and void in California. If you would like some guidance on this issue, contact our offices to discuss with one of our attorneys the options available to your Association.

Should a HOA Foot the Repair Bill for Dilatory Owners?

Published on: February 9, 2011 | by Steven J. Tinnelly, Esq.

A HOA may not be responsible for the entire cost to repair damage if the owner was slow to disclose the situation to the HOA.

The heavy rains that hit Southern California this winter have unfortunately resulted in many instances of leaks and water intrusion. If a Homeowners Association (“HOA”) is obligated under its Governing Documents to repair/maintain the exterior walls of units, it is likely also obligated to repair damage to the interior of units caused by water leaking through the exterior walls.

However, if an owner is unreasonably slow to notify the HOA of a leak, the HOA may not be responsible for the entire cost to repair the damage. HOA Governing Documents typically include provisions that hold owners accountable for damage caused by their willful or negligent conduct. Additionally, California caselaw requires that owners use “ordinary care and diligence” to prevent an unwarranted piling up of damages. If the owner failed to disclose the leak to the HOA in a timely manner, the HOA may hold the owner responsible for the portion of the repair cost attributable to the owner’s unreasonable delay in disclosure.

A HOA’s Governing Documents outline the HOA’s obligations to repair/maintain various areas within the community. However, situations often arise where the scope of the HOA’s obligations may not be clearly defined.

TLG Secures $170,000 in Attorneys’ Fees for HOA Client in Orange

Published on: February 4, 2011 | by Steven J. Tinnelly, Esq.

TLG awarded $170,000 in attorneys’ fees in maintenance enforcement suit for our HOA client in the City of Orange

For those of you that read our blog post, you know that TINNELLY LAW GROUP has recently prevailed in a maintenance enforcement suit for one of our clients–a Homeowners Association (HOA) in the City of Orange, California. Our client initially sought to resolve its dispute for several years with the homeowner outside of court through Alternative Dispute Resolution (ADR). The homeowner refused to participate in ADR and insisted that the dispute proceed to litigation.

Ultimately, TINNELLY LAW GROUP’s Bruce Kermott prevailed on the merits and secured an order for injunctive relief on behalf of our client to force the homeowner to comply with the HOA’s maintenance requirements.

The court just awarded our client approximately $170,000 in attorneys’ fees and costs. Congratulations to Bruce for yet another success.

TINNELLY LAW GROUP strives to resolve its clients’ disputes through non-judicial means wherever possible. However, when issues do result in litigation, our clients take comfort in knowing that our attorneys provide the highest quality representation available.

TLG Launch Party – A BIG HIT!

Published on: January 31, 2011 | by Steven J. Tinnelly, Esq.

A sincere thank you to all of our clients and industry colleagues that attended our Official Launch Party on Friday, January 28th

At one point it was standing room only in our new Orange County offices during our Official Launch Party. We had a fantastic time and were truly humbled by the outpouring of support and excitement for the growth of our firm and for the investments we have made.

We are privileged to work in such a fantastic industry and we look forward to strengthening our working relationships with all of you.

Continue reading this post for photos and videos from the event.

TLG Secures Injunctive Relief in Maintenance Suit for HOA Client in Orange

Published on: January 19, 2011 | by Steven J. Tinnelly, Esq.

TINNELLY LAW GROUP has prevailed in a maintenance enforcement suit for one of our clients–a Homeowners Association (HOA) in the City of Orange, California.

Our client initially sought to resolve its dispute for several years with the homeowner outside of court through Alternative Dispute Resolution (ADR). The homeowner refused to participate in ADR and insisted that the dispute proceed to litigation.

The suit resulted in 16 days of trial as the homeowner called 21 witnesses. The homeowner had subpoenaed all the members of the HOA’s Board of Directors as well as the HOA’s property managers.

Ultimately, TINNELLY LAW GROUP’s Bruce Kermott prevailed on the merits and secured an order for injunctive relief on behalf of our client to force the homeowner to comply with the HOA’s maintenance requirements.

A motion to recover our client’s attorneys’ fees from the homeowner will be heard in February of this year. We will keep you posted.

TINNELLY LAW GROUP strives to resolve its clients’ disputes through non-judicial means wherever possible. However, when issues do result in litigation, our clients take comfort in knowing that our attorneys provide the highest quality representation available.

Arbitration Provisions in Developer CC&Rs: NOT ENFORCEABLE?

Published on: January 17, 2011 | by Steven J. Tinnelly, Esq.

Arbitration provisions contained in a developer’s recorded CC&Rs are held not to be binding contractual terms…

Our recent blog post titled “Enforceability of Arbitration Provisions in Disputes with Developers” discussed the 2010 case of Pinnacle Museum Tower Association v. Pinnacle Market Development (US), LLC, 187 Cal.App.4th 24 (2010). In Pinnacle, the court held that binding arbitration provisions contained in a recorded declaration of covenants, conditions and restrictions (CC&Rs) are not enforceable against a Homeowners Association (HOA) in a dispute between the HOA and the developer. Pinnacle is up for review by the California Supreme Court; however, if it stands it will effectively invalidate most binding arbitration provisions contained in CC&Rs with respect to HOA Disputes with developers.

The even more recent case of Villa Vicenza Homeowners Association v. Nobel Court Development LLC, 2011 WL 72200 (2011) (Nobel) may serve to expand the holding in Pinnacle. In Nobel, the CC&Rs required condominium owners and the Association to arbitrate any claims they had against the developer. After buyers noticed defects in common areas and facilities, the Association filed suit against the developer. The developer’s motion to compel arbitration under the CC&Rs was denied by the trial court and the developer appealed.

In affirming the trial court’s decision, the appellate court in Nobel asserted that CC&Rs cannot be used as means for creating any continuing contractual rights between the developer of common interest developments and either a HOA or the individual homeowners. The ruling in Pinnacle did not go so far as to also render binding arbitration provisions invalid as to individual homeowners.

The court in Nobel concluded that CC&Rs, which are equitable servitudes under California Civil Code Section 1354, did not constitute contracts to provide non-owners, such as the developer, continuing and irrevocable benefits.

These rulings could significantly impact both a HOA’s and an individual unit owner’s ability to bring suit against the developer despite binding arbitration provisions contained in the recorded CC&Rs. The force of these ruling, however, hinge on the determination to be made by the California Supreme Court in its review of Pinnacle.

To read the full text of Nobel, click here.
To read the full text of Pinnacle, click here.

Villa Vicenza HOA v. Nobel Ct. Dev. LLC (2011)

Published on: January 17, 2011 | by Steven J. Tinnelly, Esq.

Arbitration provision contained in developer’s CC&Rs is not binding contract term…

Villa Vicenza Homeowners Association v. Nobel Court Development, LLC
(2011) WL 72200

OPINION, BENKE, Acting P.J.

*1 In this case the developer of a condominium project recorded a declaration of covenants, conditions and restrictions (CC & R’s) which required that a homeowners association arbitrate any construction defect claim the association might have against the developer. As we explain more fully below, we find CC & R’s are not an effective means of obtaining an agreement to arbitrate a homeowners association’s construction defect claims against a developer.1

Although both federal and state law favor the enforcement of arbitration agreements, neither federal nor state law countenance imposition of arbitration where no agreement to waive judicial remedies exists. Admittedly, in other circumstances our cases and Civil Code section 1354 treat CC & R’s as equitable servitudes which bind homeowners and homeowners associations with respect to claims they may have against each other. This treatment of CC & R’s is not based on any determination the parties bound by them are in privity of contract with either their co-owners or a homeowners association. Rather, CC & R’s are made binding in disputes between homeowners or between homeowners and a homeowners association because of their shared and continuing interest in the equitable and efficient operation of common interest developments. Here, the recorded CC & R’s, standing alone, are not a contract between the developer and the homeowners association, which only came into existence after the CC & R’s were recorded. Thus here there has been no showing the association entered into a binding arbitration agreement. Accordingly, the trial court did not err in denying the developers’ motion to compel arbitration.

FACTUAL AND PROCEDURAL BACKGROUND

Nobel Court Development, LLC (Nobel), purchased the 418 apartments, common areas, and common facilities which make up the Villa Vicenza project in 2004 and converted the apartments to condominiums in 2005. In the course of making the property a condominium project, Nobel recorded CC & R’s under which the Villa Vicenza Homeowners Association (the Association) came into existence upon the sale of the first condominium. By deed Nobel also transferred ownership of the common areas and common facilities to the Association. No consideration was provided by the Association to Nobel and the Association did not execute any documents in favor of Nobel in connection with the deed transferring the common areas and common facilities to the Association. In pertinent part, the CC & R’s require that both condominium owners and the Association arbitrate any claims they have against the developer.

Because following the first sale Nobel controlled the board of directors of the Association and because the initial condominium buyers noticed defects in common areas and common facilities and did not believe Nobel had provided a reserve fund sufficient to repair the defects, the condominium owners brought a derivative action on behalf of the Association against Nobel.2 Later, an independent litigation committee of the Association was appointed and filed a cross-complaint against Nobel. The committee alleged claims for breach of implied warranty, strict liability, negligence and as the third-party beneficiary of express and implied warranties Nobel made to individual homeowners. Following unsuccessful efforts to mediate the Association’s claims, Nobel filed a motion to compel arbitration under the provisions of the CC & R’s. The trial court denied the motion with respect to the bulk of the Association’s claims, but compelled arbitration of the express warranty claims. Nobel filed a timely notice of appeal. (Code Civ. Proc., § 1294, subd. (a).)

Cal. Civ. § 1354. Covenants and Restrictions in Declaration as Equitable Servitudes; Enforcement; Alternative Dispute Resolution

Published on: January 17, 2011 | by Steven J. Tinnelly, Esq.

Common Interest Developments>Governing Documents>Enforcement

California Civil Code § 1354.

Covenants and Restrictions in Declaration as Equitable Servitudes; Enforcement; Alternative Dispute Resolution

(a) The covenants and restrictions in the declaration shall be enforceable equitable servitudes, unless unreasonable, and shall inure to the benefit of and bind all owners of separate interests in the development. Unless the declaration states otherwise, these servitudes may be enforced by any owner of a separate interest or by the association, or by both.

(b) A governing document other than the declaration may be enforced by the association against an owner of a separate interest or by an owner of a separate interest against the association.

(c) In an action to enforce the governing documents, the prevailing party shall be awarded reasonable attorney’s fees and costs.

TLG Secures Favorable Settlement for HOA Client in Laguna Niguel

Published on: January 13, 2011 | by Steven J. Tinnelly, Esq.

TLG recently secured a favorable settlement agreement for our HOA client including a recovery of approximately $140,000…

TINNELLY LAW GROUP has just settled a maintenance and architectural enforcement case on behalf of one of our clients–a Homeowners Association (HOA) in Laguna Niguel, California. The defendant homeowner refused to fulfill her maintenance responsibilities under the HOA’s CC&Rs and also failed to comply with the HOA’s architectural procedures and guidelines before building an unapproved, and highly dangerous, addition to her property.

The dispute persisted over several years as the defendant repeatedly refused to resolve the issue amicably.

Just before trial was to finally begin, TINNELLY LAW GROUP’s Bruce Kermott negotiated a settlement agreement whereby the defendant agreed to comply with all of our client’s demands. Additionally, the defendant agreed to pay roughly $140,000 in legal fees and costs to our client.

TINNELLY LAW GROUP strives to resolve its clients’ disputes through non-judicial means wherever possible. However, when issues do result in litigation, our clients take comfort in knowing that our attorneys provide the highest quality representation available.

HOA Lawyer BLog

California Civil Code § 1354.