Deutsch & Associates and Mary Goodhue Deutsch for Plaintiffs and Appellants.
Neuland, Nordberg & Andrews and Frederick T. Whitney for Defendants and Respondents.
Individual members of Fairway Oaks Homeowners
Association (collectively, “Homeowners”) filed an action against the Association
challenging the validity of an election of the board of directors. The
trial court found the election valid and awarded the Association attorney
fees under Civil Code section 1354, subdivision (f), which authorizes an
award to the prevailing party in an action to enforce the governing documents
of a common interest development. The Homeowners do not appeal the judgment
against them, but appeal the attorney fee award. They claim their action
was filed under Corporations Code section 7616, which does not authorize
an award. We affirm.
(1) Corporations Code section 7616 provides that anyone who had the right to vote in the election at issue may petition the superior court to determine the validity of the election or appointment of a director.
Members do not have a right to cumulate their votes unless authorized by the bylaws. (Corp. Code, § 7615.) Here, the bylaws provide that “cumulative voting shall be used in the election of Directors for any election in which more than two (2) Directors are to be selected . . . .” The trial court’s comments indicated it considered the bylaws were properly before it as an attachment to the first amended complaint. The Association objected “on the grounds of competency” to the admission of the declaration of a homeowner, Mr. Pruden, which stated he would not have the right of cumulative voting if votes were limited to two rather than three. The trial court stated: “Well, this is something of a technical objection since the bylaws are before me anyway, are they not? Seemed to me they were attached to something and I seem to recall that certain provision. [¶] [Homeowners’ counsel]: They are attached to my complaint, your Honor. [¶] [The Court]: They aren’t yet in evidence, but I
assume there’s not going to be any objection to the bylaws coming in evidence.” After the
court examined the copy of the bylaws attached to the complaint and determined that it was a
complete copy, the Association’s counsel stated, “I have no objection to the introduction of
the bylaws.” The court replied, “Okay. Well, okay, because it seems to me, as I said, the
bylaws sort of cover this.” Later, in summing up the “housekeeping,” the court stated, “Now
let’s go back over to the case in chief with [the Homeowners’ counsel]. We’ve got the Pruden
declaration. Naturally I have your briefs, as you may have defined [sic]. I read the bylaws and
things like that. Do you wish to put on any live testimony in your case in chief?”
The gist of the action, as revealed by the record, was to enforce the members’ proxy and cumulative voting rights under the bylaws. As the Homeowners argued to the court, “The notice indicated to the membership that there were three vacancies on the board . . . up for election. So many of the proxies that were filled out were filled out in a way that used the cumulative voting. This in itself meant that there was no way that you could remedy that issue at the election itself.”
Kaplan contends that not all community association cases involving governing documents justify an attorney fee award under Civil Code section 1354, subdivision (f), citing this court’s opinion in Blue Lagoon Community Association v. Mitchell (1997) 55 Cal.App.4th 472. In Blue Lagoon, the association brought a petition under Civil Code section 1356, which allows “the superior court to reduce the percentage of affirmative votes necessary to amend a declaration where the property owners’ association is unable to obtain approval of the proposed amendments by the percentage of votes required by the declaration.”
(Id. at p. 474.) The association proposed amendments that had received approval by a majority
of the members but had not received the supermajority vote required by the CC&R’s. Members who were opposed to the amendments hired an attorney and filed papers in opposition to the petition, successfully defeating it after a contested hearing. However, the trial court refused the successful members’ request for attorney fees under section 1354, subdivision (f).
This court affirmed the denial of attorney fees, finding the purpose of section 1356 is to allow the association to eliminate the supermajority vote requirement when, “because of voter apathy or other reasons,” diligent efforts to permit members to vote have not been effective in obtaining approval of important amendments through the procedures authorized in the governing documents. We stated, “When the limited purpose of section 1356 is fully understood it is obvious a petition brought under this section is not an adversarial proceeding. No defendants are named. No rights are sought to be protected. No wrongs are sought to be redressed. As such, it cannot be said that by opposing the petition the objectors were enforcing the governing documents and thus entitled to attorney fees and costs.” (Id. at p. 477.)
The action here, to determine the validity of an election, is qualitatively different from the petition at issue in Blue Lagoon. It was an adversarial action to enforce the governing documents and was designed to protect the members from allegedly improper action by the Association and preserve their rights to cumulative and proxy voting. By broadening the attorney fee provision in section 1354, subdivision (f), the Legislature specifically eliminated any distinction between this type of enforcement action and one brought to enforce the placement of a fence or the painting of a garage. Nor can we perceive any reason to make such a distinction. The legislative policy underlying an attorney fee award to a prevailing party, be it homeowner or association, applies equally to both types of enforcement actions.
The judgment is affirmed. Respondent is entitled to costs of appeal.
SILLS, P. J.
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FOURTH APPELLATE DISTRICT
HAL KAPLAN et al., Plaintiffs and Appellants, v. FAIRWAY OAKS HOMEOWNERS ASSOCIATION et al., Defendants and Respondents.
G026150 (Super. Ct. No. 804320)
ORDER DIRECTING PUBLICATION OF OPINION
Pursuant to California Rules of Court, rule 978 of the California Rules of court, respondent’s request for publication of this opinion filed April 24, 2002, is GRANTED.
The opinion is ordered published in the Official Reports.
SILLS, P. J.