*1 Dist., Aug. B166186. Second Div. Five. 2004.] [No. SALAWY,
ADEL Plaintiff and Appellant, CORPORATION, Defendant and HOUSING OCEAN TOWERS Respondent. Dist., Second Div. Five. Aug. B166739. 2004.]
[No. GERSTLEY,
PAUL Plaintiff and Appellant, CORPORATION, Defendant OCEAN TOWERS HOUSING Respondent.
Counsel for Plaintiffs Romley Appellants.
David for Defendant and Edmund S. Schaffer Katz & Granof and Kamins Tyre Respondent.
Opinion MOSK, appellants Salawy Gerstley J. Plaintiffs and Adel and Paul defendant and orders awarding the trial court’s from (appellants) appeal Ocean Towers respondent Housing total of Corporation (respondent) $30,000 ($15,000 in each against appellants) pursuant Civil Code1 (f), section for reasonable provides attorney fees for the in an action to enforce the documents of a common interest Because claims here were development. actions, not such we reverse the fees awards. We hold that a defendant’s successful invocation of the documents as defense does not entitle it to if the attorney fees claim was not to enforce brought those documents.
BACKGROUND were residents Appellants shareholders a 317-unit respondent, in Santa apartment cooperative Monica. Because the building apartment significantly damaged by 1994 Northridge earthquake, shareholders undertook to renovate and repair building.
In December each filed but appellants identical separate complaints In against their respondent. that were complaints, appellants alleged they shareholders of and holders of respondent leases in the proprietary apartment cooperative as a operated by respondent common interest within development of section meaning (c). contended that Appellants notified them in that respondent all residents must vacate their units for occurred; one approximately while and year renovations repairs respondent would and pay relocation packing insurance would cover expenses; homeowners’ dues and mortgage payments during absence of the resi- dents; and units would be and renovated repaired materials using of the same as that workmanship which existed before the quality earthquake. that relied Appellants alleged they on statements in respondent’s vacating units; reimbursed; their that their were never and that incurred expenses they $100,000. damages exceeding alleged that were Appellants promises enforceable. did not that were to enforce the Appellants allege they seeking terms of their leases or the or proprietary bylaws other documents of respondent. demurred to the
Respondent on the that had complaints ground appellants not relied but had done what was upon any promise merely of all required shareholders reconstruction of the move out. Re- during building: namely, documents, also that the argued terms of spondent respondent’s shareholders, which were on all binding vested board of direc- statutory All further references are to the Civil Code unless otherwise indicated. and limited for renovation and appellants’ tors with repairs, responsibility maintenance and the board’s concerning remedies in the event of a dispute of the building. repair of its bylaws relied on the following provisions
Respondent specifically [|] In the event “13.01 Partial Destruction. concerning damage: earthquake fire, as a result of damaged destroyed that Ocean Towers is partially magnitude and such is of such damage flood or other hazard earthquake, one hundred twenty be or restored within it may reasonably repaired to not or such is confined damage the occurrence of such damage after days does not or such (10%) damage ten of the Apartments more than percent of at least ten percent interfere with use substantially occupancy to be cause such damage then the Board shall (10%) of the Apartments, thereof, shall insurance and the cost net of any proceeds, rebuilt and repaired forth in Section rata in the ratio set be all Shareholders against pro assessed however, 10.06; the case of the destruction of improvements provided, standard, be obligated the Board shall only exceed the building Major standard. 13.02 building such to the damage rebuild and repair [f] Damage to the building the event of or destruction damage or Destruction. In of restoration is less forth in 13.01 but where cost which exceeds that set (exclusive of Ocean Towers (60%) of the fair market value than sixty percent destruction, then the land) damage to the to such prior of value attributable before the shall be building placed to the restoration of decision as thirty days called the Board within at a to be meeting Shareholders the Shares If holders of a majority of such destruction. after the occurrence restoration, concur, and the cost of such then the shall be restored building pro all Shareholders against shall be assessed net of insurance proceeds, *5 of proprietary relied on appellants’ . . . .” also provisions rata Respondent concerning board with discretion and its leases that empowered respondent remedies to limited tenants’ housing of the project; maintenance cooperative and bylaws; under articles as shareholders respondent’s their rights be accorded tenants other that no abatement of rent or compensation provided to the project.2 with or improvements in connection repairs were 4, 2002, filed first amended complaints On February appellants that they to the original complaints, except in all material respects identical to enforce seeking promises. as the basis alleged promissory estoppel to the amended complaints demurrers The trial court sustained respondent’s not The record does within 10 days. leave to amend but granted appellants of provisions of the relevant judicial court take notice requested that the trial Respondent the trial does not show that The record bylaws and other request. granted respondent’s court order, it the ground contain the trial court’s written nor does show ruling for the trial court’s the demurrers. did not amend ruling sustaining Appellants their amended but instead to dismiss them sought respective complaints without after the had moved for 10-day prejudice period expired. Respondent dismissal of actions with and for appellants’ prejudice entry judgment, which motions the trial court The were entered on granted. judgments 22, October 2002. filed motions for fees to sections 1717 and
Respondent attorney pursuant 1354, $15,000 (f). subdivision The trial court awarded in attorney respondent (f) fees to section in each of subdivision actions. pursuant appellants’ awards, and the two were Appellants appealed attorney appeals consolidated.
DISCUSSION A. Standard Review
An order an award of fees is granting denying generally review; however, reviewed under an abuse of discretion standard of “ ‘determination of whether the criteria for an award of fees and ” costs have been met (Walker is a of law.’ Home question Countrywide Loans, 79], Inc. quoting Loans, Countrywide Ramos v. Home Inc. 388].) entitlement to fees under section Respondent’s (f) subdivision is a de law novo standard of question requiring
review.
B. Attorney (f) Fees Under Section Subdivision Act, Section 1354 is common part Davis-Stirling governs (§ (f) interest in California. 1350 et Subdivision of section developments seq.) (a) “In to enforce provides: specified documents, the shall be awarded reasonable (§ (f).) (a) . . .” attorney’s fees costs. subd. Subdivision of section 1354 states that the covenants and restrictions set forth in an association’s are governing documents and enforceable the association binding upon *6 and all owners of interests: “The covenants and restrictions in the separate servitudes, unreasonable, declaration shall be enforceable unless equitable and shall inure to the benefit of and bind all owners of interests in separate otherwise, the Unless the declaration states these servitudes development. association, be enforced of a or the or may by owner interest by any separate 1354, (§ (a).) subd. documents” are defined in section by “Governing both.” documents, 1351, subdivision as “the declaration and other such as (j) any association, the articles of rules of by-laws, operating incorporation, association, articles of which the of the common interest govern operation 1351, (§ or association.” subd. (j).) development
C. Trial Court’s Rulings the trial court of its reason the record contains no statement Although by demurrers, trial awarded fees attorney for the the court sustaining expressly Thus, (f). under subdivision we infer that its orders may section were on documents. governing the demurrers based sustaining The leases between “In the event of provided: appellants respondent of the any action between the hereto enforcement of parties seeking Lease, the in such action shall be terms and conditions of this prevailing party relief, awarded, other in addition to its reasonable damages, injunctive and reasonable fees.” We costs and not limited to costs expenses, attorney also infer that not fees under section awarding provides may by contract, to a the trial court did not determine that fees attorney pursuant enforcement” of the lease. As this “seeking there had been an “action” appeal (f), of subdivision we do not involves section only application be decide whether the leases and the fees clauses in the leases may with a contract. We deal here with a statute and not only applicable.
D. Subdivision Inapplicability (f) Section (f) Section subdivision limits the award of expressly in an “action ... to enforce governing fees to documents.” actions were not to “enforce” respondent’s “govern Appellants’ con and the amended complaints documents” because ing complaints tained no claim based on a under the right remedy governing Instead, unrelated to the governing the claims were to enforce promises documents documents. Demurrers or other defenses asserting governing ... enforce the documents.” do not constitute “action[s] an action as not that if a to frame attempts Respondent argues plaintiff documents,” a claim under asserting but is in “governing reality enforcing effect, documents, who, enforces those a defendant the governing documents, documents the claim on basis defeating (f). Re- under section be may deprived
671 correct that cannot avoid the fees if attorney is spondent plaintiff provisions the essence of the claim falls within the enforcement of the governing documents. Fairway
Thus, Oaks Homeowners Assn. Kaplan (2002) in (Kaplan), the court affirmed an Cal.App.4th [120 158] award fees to defendant to section attorney prevailing pursuant (f), subdivision even the amended in did though that case not complaint to enforce the common interest governing documents. purport development’s Kaplan sought The in to enforce their cumulative plaintiffs proxy voting to elect association board members rights by initially filing complaint violations of both the alleging association’s and the bylaws Corporations Code. When the association demurred on the the that had ground plaintiffs failed to alternative resolution as section pursue dispute required by (b), subdivision the amended their to a breach of plaintiffs complaint allege Code section 7616 as the Corporations sole cause of action. They specifically that the alleged articles and of the association the bylaws for provided right of the to vote members and attached those the by proxy documents to trial, After the association at the pleading. trial court prevailed granted association’s motion (f). fees under section subdivision The plaintiffs award on the that the sole their challenged ground theory amended a breach was of the Code and that complaint Corporations action was not one “to enforce the documents” as governing required by section (f). subdivision The court of affirmed the appeal award under section (f), subdivision reasoning gist “[t]he action, record, as revealed by the was to enforce the members’ proxy cumulative under voting rights ... It an bylaws. [][]... [][] adversarial action to enforce the documents and was governing designed protect members from allegedly Association and improper proxy voting.” (Kaplan, supra, their to cumulative and preserve rights 720-721.) The court said that the are pp. bylaws part governing documents.
Here, however, actions was not to enforce the “gist” appellants’ actions, meritorious, documents. The governing even if not were based on an unrelated to the alleged promise Although respondent’s demurrer invoked the documents order to defeat appellants’ claims, (f) section an does not authorize award of attorney Electronixx Heger Realty Exxess Corp. (Cf. fees in this case. on tort claim does not [prevailing 376] result in award of fees under a contract for such fees in an providing contract].) action to enforce a Palmer v. Agee 841],
In a ten Cal.App.3d Cal.Rptr. ant who asserted section 789.5 as a defense in an unlawful successfully *8 672 789.12,3 fees under former section
detainer action was awarded statutory attorney fees to the in an for the award for attorney prevailing party provided to In that case the court granted “action out of Sections 789.5 789.22.” arising the on the that the ground the tenant’s motion for on judgment pleadings with a written notice of termination 60-day landlord had not complied that the former section The court concluded 789.5.4 imposed by requirement 789.5, the tenant Civil Code section even though action did “arise” out of 377, is Palmer v. Agee, supra, 87 Cal.App.3d invoked the statute defensively. the authoriz- statutory language from the instant case because distinguishable than the in the instant language fees in that case was broader ing attorney an fees award in an “action The statute in that case authorized case. Here, the statute. the statute provides out of’ arising applicable applicable to enforce the in “an action ... fees to prevailing party 1354, a defensive contention (§ (f).) subd. Even if documents.” statute,5 “an action to enforce” the it does not constitute arises out of is that it is a The of an “action to enforce” understanding common Thus, not only a claim. an action initiated of filing proceeding at “but refers to the entire judicial proceeding the complaint encompasses ” with ‘suit.’ and is considered through judgment generally synonymous least 1294, Court (1989) 214 1298 (Nassif v. Municipal Cal.Rptr. Cal.App.3d [263 at Heger Realty Corp., supra, see Exxess Electronixx v. 195]; 64 Procedure defines an “action” 15.) fn. Section 22 of the Code of Civil p. “An is an in a court ordinary justice by as follows: action proceeding declaration, enforcement, or another for the which one party prosecutes of a or the wrong, of a the redress or right, punishment protection prevention “A of Civil Procedure provides: a offense.” Section 30 of Code public declaration, one another for the against civil action is prosecuted by party or of a wrong.” or of a or redress right, prevention enforcement protection does not refer to specific pleadings steps An “action to enforce” Thus, not constitute “an a demurrer does within the action or defense. the legal that challenges A demurrer is a right. pleading action to enforce” Hale v. 232 Cal.App.2d (People another sufficiency pleading. 533].) sufficiency of a demurrer is to test “The function 120 Cal.Rptr. [42 Fund (Salimi Ins. Comp. v. State of law.” of a by raising questions pleading 789.12, Agee, supra, of Palmer v. Cal.App.3d in effect at the time Former section 789.11, inclusive, to arising “In out of Sections 789.5 part: in relevant action provided attorney’s fees and costs.” The statute shall be entitled to reasonable amended and is now codified at section 798.85. subsequently 4 Now section 798.56a. court in Palmer agree to whether we with the question have reach the as We do not arising Agee, supra, matters constitute an “action page that defensive Cal.App.3d purposes of fees. out of’ a statute for Matinee, 640]; see Holiday
(1997) 54 Rambus, Inc. Inc. 118 Cal.App.4th Proc., 766].) (Code A not another Civ. against demurrer is “prosecuted” 22, 30) and not an “action to enforce.” ‘defense’ is therefore is §§ “[A] ‘[t]hat in an party proceeded against which is offered and alleged by *9 suit, a in the as reason law or fact should not recover why plaintiff to the claims of the other seeks[; response establish what he it is ...[][] a] forth reasons the claims should not be setting why granted.’ party, [Citation.]” (Exxess 712, Realty Electronixx v. Heger Corp., supra, 64 at p. 15.) fn. That the common of “action”—as in an “action to en meaning force”—does not include such as a demurrer or other procedural steps defenses is the in an “The illustrated authoritative work: by following passage (1) broad definition the at law or in covers suits following: equity. [of action] (2) Certain a that take adversary proceedings place during probate [Citation.] (4) Actions for relief. proceeding. declaratory [Citation.] [Citations.] Witkin, (dissolution (3 Actions for divorce of Cal. marriage). [Citation.]” Actions, 11, (4th 1996) 64-65.) Procedure ed. There is in nothing this pp. § to that a defensive matter a demurrer in passage suggest raised is included the term “action.”6 Exxess Electronixx v.
As the court in Heger Realty Corp., supra, said 712, Cal. App.4th which involved a lease page reasonable fee provision, any attorneys’ interpretation “[u]nder we cannot a provision, ‘defense’ with an ‘action’ or equate raising bringing a defense to the ‘proceeding.’ By asserting Heger Realty cross-complaint, did not an action or the bring to enforce lease or declare proceeding under it.” here the the rights Similarly, defense of docu- governing ments of demurrer was not an ... by way “action to enforce governing Moreover, documents.” that a demurrer an is respondent’s position “action,” conclusion, if carried to its would have the anomalous logical overruled, if demurrers had been consequence would be for respondent attorney Treating fees. responsible appellants’ (“Action” Dictionary Usage See a page Mellinkoff s of American is defined as “1. case, lawsuit, sense, action is and suit and has no more interchangeable lawsuit. In this with sense, technicality action is also any right than 2. a called a of them. ... to sue. In this action”); (8th 2004), (“A Dictionary page cause Black’s Law ed. column 1 civil or Estee, (3d 1885), judicial proceeding”); Pleadings, criminal Estee’s Practice and Forms ed. (“An page ordinary proceeding section action has been defined an in a court of to be justice, by a party prosecutes party protection which one another for the enforcement or right, prevention wrong, public the redress or of a of a offense. But in some punishment equally applicable special proceedings. accurately, sense this definition is More it is defined which, determination, any judicial judgment proceeding, to be if conducted to a will result in Dictionary, judgment”), quoted or decree. The action is to terminate at in Black’s Law said Code, ‘Action,’ 1; supra, (“ in the page column see also Uniform Commercial section 1201 counterclaim, setoff, judicial proceeding, recoupment, equity, sense of a includes suit in determined”). any rights proceedings other in which are a demurrer as an “action” could have unforeseen in other areas consequences the established use of the word “action.” involving that a claim not based on the docu suggests governing
Respondent far-fetched, and it be anomalous that ments is to be more thus would likely claim the less fees can be awarded likely attorney against more dubious a claim. But the of the statute language awarding such party making in an fees determines whether or not a successful defense will result attorney (f) authorizes an fees award. Section (§ documents.” award in “an action ... to enforce only fees to (f).) subd. The statute could have been written to provide to” the out of or related “arising did A court is documents or in which are enforced. But it not. they not free to the words of a statute a definition “different from give plain Fed. & Loan (California Savings and direct terms used.” import *10 v. City Angeles Assn. Los (1995) 11 Cal.4th Cal.Rptr.2d 349 [45 of 297].) to ascertain the of the words meaning P.2d The court’s role is “ ” used, the law to ‘not to insert what has been omitted’ or otherwise rewrite (Ibid.)7 conform to an intention that has not been expressed.
DISPOSITION The trial awards of fees in both cases are reversed. We attorney court’s fees remand the matter to the trial court to determine whether or not should be awarded to provisions appellants’ pursuant recover their on leases and section 1717. shall costs Appellants appeal. J.,P. concurred.
Grignon, Acting
ARMSTRONG, dissent. I respectfully J. issue, enforce whether this was a lawsuit to brought
This case raises one v. Oaks Fairway documents. Relevant precedent, Kaplan the governing 158], Homeowners Association 98 Cal.App.4th of the record reveal that the trial court was and a commonsense examination on holding I thus with the disagree majority’s it was such lawsuit. right, that issue. on, view to the opening paragraph,
I also with the disagree majority’s quote invocation of the documents” governing whether a “defendant’s successful (f) fees awards under section subdivision Because we conclude that amount of fees awarded was appellants’ contention that the improper, were we do not address excessive. Here, (f). I
would entitle it to fees under Civil Code section “view,” in this and not because the is not raised say holding, theory appeal and, dicta, has unnecessary, being the discussion is dicta. The discussion is dicta’s common It is difficult to understand and has the to problems. potential have be to situations the not applied majority may contemplated. cites, case, In that Kaplan,
I with which the then begin majority ignores. to a violation of the Code alleged relating proxy complaint Corporations but after an examination of what the case was voting actually rights, about, the action was to enforce the Court found that “gist” (Kaplan homeowners’ under documents. voting rights governing Association, 720; Fairway Oaks Homeowners see supra, p. Benedict Cutujian Hills Estates Assn. also 1388, fn. 2 an action labeled [gravamen “continuing 166] covenants, nuisance” was enforcement of the conditions and restrictions (CC&R’s)].)
Here, label, came although cause with a promissory estoppel based on Ocean Towers actually appellants’ theory Housing Corporation’s violation of its alleged duty repair appellants’ earthquake-damaged apart- condition, ments and to restore those to their original duty apartments documents. The imposed gist gravamen complaint That, label, awas violation of the not the controls. *11 “How the the achieves the in is not party goal enforcing right question determinative of the to an award of . . . The of the right attorney fees. impact (In 223, 184, re Head (1986) is.” 42 Cal.3d litigation 228-229 Cal.Rptr. [228 Proc., 1021.5, P.2d 721 Civ. fees available to [Code § 65] habeas proceedings].) corpus
“Gist” and are shorthand for the California “gravamen” rights primary “under the which invasion of one rise to a theory, primary right gives single (Slater v. Blackwood (1975) cause of action.” 15 Cal.3d 795 [126 “ 593].) 543 P.2d the harm “cause of action” is based on Cal.Rptr. ‘[T]he suffered, as to the asserted the . . . Even theory by litigant. opposed particular where there are theories be legal recovery might multiple upon ” (Bay one Cities injury gives rise to one claim for relief.’ predicated, only & Inc. Mutual Co. Paving Grading, Lawyers’ v. Ins. (1993) 5 Cal.4th Blackwood, supra, Slater v. 1263], 860 855 P.2d Cal.Rptr.2d quoting [21 795.) 15 Cal.3d at nature a cause of action does not on depend p. “[T]he seeks but on the the label it or the relief the gives plaintiff plaintiff Marella, (Bird, v. Court Wolpert Superior Boxer & involved.” right primary 782].) The (2003) 106 427 caption [130 immaterial. or the is theory pleader complaint particular adopted 676 that the right
It is clear from in this allegations complaint primary was their to have the right damage to enforce appellants actually sought their and the restored to their condi- original apartments repaired apartments tion, in accord with the documents. Under the guise “promis- the relief available to them under sory sought estoppel,” appellants precisely awarded under the Any judgment promissory would result in the enforcement of those documents. theory estoppel (1978) I now turn to the discussion of Palmer v. Agee Cal.App.3d (I and its would also discuss Exxess progeny. Cal.Rptr. [150 841] Electronixx v. Heger Realty Corporation case, 376], but it is a Civil Code section 1717 in which the issue The
was whether tort causes of action were to enforce a contract. brought case, one, issue is not an unusual but it has to do with this this nothing discussion.) Palmer,
In was the owner of a mobilehome and landlord plaintiff park, initiated He eviction under standard to defendant tenants. proceedings The on the landlord-tenant tenants moved procedures. judgment pleadings had with the eviction on the landlord failed to ground comply in the Law. The trial court Mobilehome procedures specified Residency the motion and awarded fees to the tenants under a section of that granted out arising law which for fees to the “in party provided prevailing affirmed. After of’ that law’s eviction The Court of provisions. Appeal some commonsense observations about the kind of making game-playing otherwise, in if the the court held that “An landlords would engage ruling the document the action but initiating action is not limited to complaint (Palmer the entire judicial proceeding.” Agee, supra, Cal.App.3d 387.) p. Court Municipal
Other courts have concurred in this analysis: Nassif 195], considering Cal.Rptr. Cal.App.3d section 583.110 of “action” for of Code of Civil Procedure meaning purposes (H.K.) cited Palmer’s Ltd. v. Court Sunkyong Trading Superior holding, *12 504], which considered 288-289 9 Cal.App.4th 170.6, cited for the “action” under Code of Civil Procedure section Nassif for which cited Palmer. proposition Nassif a an defined as a wherein one asserts right action is
“Generally proceeding ([Code 22.) a Civ. An action is usually or seeks redress for wrong. § Proc.] ([Code Civ. to of a filing complaint deemed commence upon Proc.] ([Code final. 411.10) remains until the is judgment 350 & and pending §§ Court, at 214 1049.)” (Nassif Municipal supra, Cal.App.3d Civ. Proc.] § 1298.) p.
These cases tell us that even if—and that is not the case here—respondent demurrer, had sought fees based on a governing-documents it would be entitled to fees if it prevailed.
The seeks to Palmer from majority distinguish this case based on the difference purported between an “action to enforce” and an “action arising from.” I find the discussion clever and overly These are hypertechnical. fee similar to countless and provisions, statutory contractual attorney fee Such should be provisions. provisions and interpreted broadly liberally. (Milman v. Shukhat 526] Code, mutuality]; Kaplan Fairway § Oaks Homeowners [Civ. Association, supra, 719.) Their p. only is possible purpose to discourage litigation by that when providing two into in a parties get statute, lawsuit over the matters to subject the contract or the winner gets I fees. cannot simply that a imagine lawyer or ever reached the legislator considered that it was and opinion right that in some just circumstances the files, defends, who but party not the who recover party may fees. What kind make, of sense would that if the context is not a laboratory analysis but the language, lives of ordinary people, organizations, their lawyers? None.
A search of the legislative shows no trace history of such an intent. Those legislative documents which mention the fee in Civil Code provision (the section 1354 clause was added as of a bill which part primarily concerned solar describe the energy) as one which provision awards fees to the prevailing “in to party any litigation (Sen. enforce” the CC&R’s Rules Com., Off. of Sen. Floor 3d Analyses, of Assem. Bill reading analysis (1989-1990 No. 4; Sess.) Reg. Aug. Sen. par. Housing Com., Urban Affairs com. (1989-1990 on Assem. Bill No. Sess.) Reg. 2, 1990, Aug. 4.), or “in action to enforce par. restrictions affecting Hauser, common interest developments.” (Assemblyman of Assem. sponsor Governor, 28, 1990, Bill No. letter to 2.) Aug. p. narrow
Finally, majority’s of “action” seems to me to reading have the not, moment, to potential confuse what are at the unnecessarily confused issues. Does the majority suggest a who files a writ of mandate plaintiff documents, seeking board to act under the compel and is successful, all, “action,” is not entitled to fees? After a writ is not an it is a special proceeding. documents Suppose established statute of *13 board, a board moved successfully and against limitations on suits would read the that board majority, on that As I ground? summary judgment none, I can see in that result? logic not be entitled to fees. Where is of the trial court’s to a affirmance would confine this opinion simple straightforward ruling. 9, 2004, denied
A for a rehearing September petition December 2004. Court was denied for review the Supreme petition