CA Ct. Says HOA that Dismissed Case is Entitled to Attorney Fees Because it “Got What it Wanted.”

Unpublished California Appellate Court decision (May 28, 2014).

This case involved an appeal by a homeowner from a lower court judgment that awarded a homeowners association legal fees as the prevailing party in a case against the homeowner.

The homeowners association brought suit against the homeowner seeking injunctive relief to compel compliance with its CC&Rs by the homeowner. After the trial court granted the association a preliminary injunction (a temporary injunction during the pendency of the case), the homeowner removed the improvements that were constructed in violation of the CC&Rs, sold his property and moved. The association then dismissed its lawsuit without prejudice and filed a motion for an award of attorney fees as the prevailing party — which the court granted. The homeowner appealed the award of attorney fees contending that the trial court abused its discretion by: (i) failing to grant him a continuance to retain counsel; and (ii) finding that the homeowners association was the prevailing party when it had dismissed the case.

The appellate court ruled that the trial court did not abuse its discretion by denying the homeowner a requested continuance of the hearing regarding the award of attorney fees. The court found that the homeowner had an opportunity to retain counsel and he chose not to do so. In upholding the award of attorney fees to the homeowners association as the prevailing party, the court found that the determination of who is the prevailing party in a case must be made on a “practical level.” The determination involves an analysis of whether the party moving for attorney fees “achieved its main litigation objective.” Prior to the dismissal the association succeeded in obtaining a preliminary injunction, which stopped the conduct that was in violation of the CC&Rs, and resulted in the homeowner removing the items in question. Thus, the association prevailed because it “got what it wanted.”

See case decision: Sungate_Country_Owners_Ass’n_v._Stephens_(Cal._App._2014)1