View Rights and Inverse Condemnation

(by Keith Turner, Esq. and Emma Samyan, Loyola Law School, J.D. Candidate | Class of 2018)

An ocean, mountain, city or other view can add a lot to a property’s value.  However, as “a general rule, a landowner has no natural right to air, light or an unobstructed view and the law is reluctant to imply such a right.”   The plaintiffs in the recent case of Boxer v. City of Beverly Hills (2016) 246 Cal.App.4th 1212 tried to use an inverse condemnation claim to sue the City of Beverly Hills for condemnation for planting thirty (30) Sequoia (Coastal) redwood trees in Roxbury Park.  The trees obstructed the homeowners long enjoyed view of the Hollywood Hills, , downtown Los Angeles, “and—on a clear day—Mounty Baldy 50 miles away.”  The court held that a view rights claim cannot be the basis of inverse condemnation claim.

What is inverse condemnation?

In a nutshell, “inverse condemnation” is based on the Constitutional right that provides that a property owner is entitled to compensation if the government takes its property.  The California Constitution specifically provides: “Private property may be taken or damaged for public use only when just compensation has first been paid to the owner.”  (Cal. Const. art. I, § 19; emphasis added.)  This constitutional principal provides for two types of claims:  [1] eminent domain (or condemnation), which is when the government sues a property owner to acquire property; and [2] inverse condemnation, which is when a property owner sues the government for taking or damaging its property  In either case the property owner is entitled to recover just compensation, which is often measured by the fair market value of the property taken.

The Boxer case

The plaintiffs in Boxer v. City of Beverly Hills were homeowners on Spalding Drive in Beverly Hills.  They sued the City of Beverly Hills for inverse condemnation, seeking damages and injunctive relief for the view obstruction as a result of coastal redwood trees that the City planted in Roxbury Park.  The plaintiffs specifically alleged that the trees blocked their “unobstructed view of the hills of Beverly Hills, the Hollywood Hills, and the Los Angeles basin, including the Hollywood sign, the Griffith Observatory, downtown Los Angeles, and—on a clear day—Mounty Baldy 50 miles away.”

The trial court sustained the plaintiffs’ demurrer, without leave to amend, which the court of appeal affirmed in the reported case.

The bottom line:  The court held that the plaintiffs could not sue the City for the view obstruction because “’[U]nder California law, a landowner has no right to an unobstructed view over adjoining property.’” Boxer v. City of Beverly Hills (2016) 246 Cal.App.4th 1212, 1219 (citing Posey v. Leavitt (1991) 229 Cal.App.3d 1236, 1250).  The general exceptions are view rights provided by local ordinances; CC&Rs or other deed obstructions; and in certain nuisance cases.  Id.

The plaintiffs in Boxer “vigorously” tried to save their claims by arguing that a property owner’s loss of view can be an element of compensable damages in eminent domain cases where there was a physical taking of the claimant’s property.  However, the court rejected that argument because there was no “physical invasion in a tangible manner,” which is the prerequisite for an inverse condemnation claim. The trees were planted on a neighboring property, not on any part of the plaintiffs’ property, nor did the plaintiffs complain “that the trees or debris from the trees physically intrude[d] upon the plaintiffs’ properties. (Id. at 1219). Plaintiffs are merely complaining of their obstructed view rights, which do not constitute physical damage to their properties. Thus, plaintiffs have not set any tangible physical intrusion on their properties.

Presumably, the plaintiffs-homeowners in Boxer have suffered a material loss in their value of their home from the loss of the views. The general common law rule of no view rights and the Boxer case is another reminder to home buyers (and their real estate brokers) to thoroughly research the property’s view rights if the view is an important part of the property’s value, before the sale closes.

tree pic

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Marquez Knolls’ view rights under attack again (Eisen vs. Tavangarian)

Marquez Knolls’ view rights under attack again (Eisen vs. Tavangarian)

Since the 1950s, property owners in the Marquez Knolls tracts in Pacific Palisades have relied on the recorded CC&Rs to protect their views.  Although the original architectural committee’s powers expired on December 31, 1995, many property owners believed that their view rights continued by CC&Rs Paragraph 11, which did not have a termination date, and which provides:

“No fences or hedges exceeding three feet in height shall be erected or permitted to remain between the street and the front set-back line nor shall any tree, shrub or other landscaping be planted or any structures erected that may at present or in the future unreasonably obstruct the view from any other lot, and the right of entry is reserved by the Declarants to trim any tree obstructing the view of any lot.”

(The word “unreasonably” was added to ¶11 by the Court of Appeal in its 2005 decision in Zabrucky v. McAdams (2005) 129 Cal.App.4th 618.)

For the reasons discussed below, it could now be the perfect storm to reverse or materially change the view rights that were provided in Zabrucky.

There is a case currently on appeal that is seeking to reverse or limit the view rights the court affirmed in the 2005 Zabrucky case.  The current case is Eisen vs. Tavangarian  (See opening brief served on Sept. 25, 2017.)   Concerned Marquez Knolls’ property owners can voice their concern by submitting an amicus brief by the court deadline.  (Contact us for information on the deadline.)

The plaintiffs in Eisen sued a well known local developer for obstructing their view.  The trial judge found in favor of the plaintiffs and ordered the defendant to remove a portion of the new “spec” house he had constructed.   The defendant is presently appealing the judgment against him, and in his opening appellate brief is seeking to the view rights it affirmed in the Zabrucky case

The plaintiffs in Zabrucky had actually argued that ¶11 precluded any obstruction of their ocean view.  The Court of Appeal in that case was apparently aware that its decision would have a significant impact on the ability to remodel the original aging homes in Marquez Knolls.  The court tried to find a balance, while acknowledging the CC&Rs’ intent to provide view rights.  As the court stated at pages 623-624:

“In common with most coastline housing in Southern California, the prime thing the Marquez Knolls development sold its prospective homeowners was a beautiful ocean view. In fact, like most such housing, much of the value of any property within the development depends on the quality of the view. To significantly obstruct any homeowner’s view of the Pacific Ocean is to depreciate the economic worth of their property-often by several hundred thousand dollars – as well as dramatically reduce their enjoyment of the home they bought and live in. Thus, it is not surprising the rest of the Zabruckys’ neighbors, the MKPOA, filed an amicus brief seeking to enforce the development’s CC&Rs. These provisions, and especially the Paragraph 11 at issue in this case, form their only bulwark against rampant expansions of existing residences that would obstruct views and depreciate land values throughout the entire Marquez Knolls neighborhood.”

The plaintiffs argued that ¶11 prohibited any obstruction.  But the court of appeal in the published decision rejected that argument and instead added the word “unreasonably” to ¶11”.  At page 629 the Court stated:

“However, it is not reasonable to interpret the CC&Rs as prohibiting any obstruction of existing views as urged by appellants. We agree with the trial court’s observation that it would have been impractical for the original drafters of the CC&Rs to have intended that no house be built which obstructed any other owner’s view. Thus, we conclude it would be in keeping with the intent of the drafters of the CC&Rs to read into Paragraph 11 a provision that the view may not be unreasonably obstructed, thus the sentence would read, “may at present or in the future unreasonably obstruct the view from any other lot.” (Change underlined.)”

Unfortunately for the plaintiffs, on re-trial, the trial court judge inspected the properties and decided that defendants’ remodeling project was not an unreasonable obstruction.  (See then Judge John L. Segal’s Statement of Decision 3-1-2006.)

Since 2005, there have been a number of lawsuits filed challenging new construction and remodeling projects and also landscaping on the grounds that the construction or landscaping was or would be an unreasonable obstruction.  (See partial list of case here.)  The many of those cases went to trial and were decided by a judge, not a jury, and it seems the result depended on the particular’s judge’s interpretation of what constitutes to be “unreasonable obstruction.”

The trial judge for the Zabrucky re-trial is now one of the three appellate justices that is deciding the Eisen appeal.  In Zabrucky and supposedly in the other Marquez Knolls cases he decided as a trial court judge, Judge (now Justice) Segal did not find for any plaintiff seeking to enforce ¶11.

But the main concern now is that the Presiding Justice for the Eisen appeal, Justice Dennis M. Perluss, wrote the dissenting opinion in Zabrucky.  In Zabrucky, Justice Perluss disagreed with the majority’s interpretation of paragraph 11, explaining that its “plain language . . . particularly when considered together with other provisions in the CC&R’s,” did not support the majority’s conclusion. (Zabrucky, supra, 129 Cal.App.4th at p. 630 (dis. opn. of Perluss, J.).)

“Apparently uncomfortable with the harsh consequences of their restrictive reading of the view protection clause, my colleagues adopt the suggestion advanced by amicus curiae Marquez Knolls Property Owners Association (but notably not endorsed by the Zabruckys) and create a reasonableness limitation on the absolute prohibition of view obstruction contained in paragraph 11. This effort to mitigate the impact of their decision for homeowners like McAdams and Baines who may wish to renovate homes that are now 40 years old is in many respects commendable, but it constitutes an impermissible rewriting of the express terms of the CC & R’s.”

“The majority’s legitimate concern that paragraph 11 may be applied unreasonably suggests to me it has misinterpreted that provision. Its apprehension, however, is not a justification for a judicial rewriting of the parties’ agreement.”

But more problematic is that Judge Perluss’s dissent in Zabrucky went further by concluding that ¶11 should not even apply to structures:

“Although in other contexts the word ‘structure’ may include the residence itself, given the apparent object of paragraph 11, particularly when read together with paragraph 2, ‘structures’ in this paragraph is properly limited to landscaping or other outdoor items separated from the residence itself—gazebos, trellises, carriage or pool houses.”

The Appellant (Ardie Tavangarian) in Eisen is arguing among other things that “Paragraph 11 applies only to landscaping structures and therefore does not restrict alterations to a residence.“  (Opening Brief, p. 35)  With Justices Perluss and Segal as the appellate justices, it seems from the sidelines that the view rights that many have taken for granted in Marquez Knolls could be eliminated or severely limited by the Court’s decision in Eisen.  

Property owners in Marquez Knolls can seek to participate in the appellate litigation as amicus curiae (the Latin phrase that means “friend of the court”).  There is a deadline to do so.  For further information, click here to contact us.

 

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Keith Turner co-author CEB’s California Easements and Boundaries: Law and Litigation book

The Continuing Education of the Bar (CEB) is a joint committee of The State Bar of California and the University of California that among other things publishes the leading legal treaties on California law topics.

Keith Turner is a co-author of two chapters in CEB’s California Easements and Boundaries: Law and Litigation book:

  • Boundary Easements and Neighboring Property Rights
  • Litigating Easement and Boundary Disputes

These chapters include some of the main laws and concepts involved in neighbor disputes, including encroachments, easements, party walls, view rights, trees/hedges, local zoning, etc., etc. etc.

 

CEB book.png

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View Rights and Inverse Condemnation

(by Keith Turner, Esq. and Emma Samyan, Loyola Law School, J.D. Candidate | Class of 2018)
The Turner Law Firm is one of the leading view rights law firms in California and has handled hundreds of view right cases.

An ocean, mountain, city or other view can add a lot to a property’s value.  However, as “a general rule, a landowner has no natural right to air, light or an unobstructed view and the law is reluctant to imply such a right.”   The plaintiffs in the recent case of Boxer v. City of Beverly Hills (2016) 246 Cal.App.4th 1212 tried to use an inverse condemnation claim to sue the City of Beverly Hills for condemnation for planting thirty (30) Sequoia (Coastal) redwood trees in Roxbury Park.  The trees obstructed the homeowners long enjoyed view of the Hollywood Hills, , downtown Los Angeles, “and—on a clear day—Mounty Baldy 50 miles away.”  The court held that a view rights claim cannot be the basis of inverse condemnation claim.

What is inverse condemnation?

In a nutshell, “inverse condemnation” is based on the Constitutional right that provides that a property owner is entitled to compensation if the government takes its property.  The California Constitution specifically provides: “Private property may be taken or damaged for public use only when just compensation has first been paid to the owner.”  (Cal. Const. art. I, § 19; emphasis added.)  This constitutional principal provides for two types of claims:  [1] eminent domain (or condemnation), which is when the government sues a property owner to acquire property; and [2] inverse condemnation, which is when a property owner sues the government for taking or damaging its property  In either case the property owner is entitled to recover just compensation, which is often measured by the fair market value of the property taken.

The Boxer case

The plaintiffs in Boxer v. City of Beverly Hills were homeowners on Spalding Drive in Beverly Hills.  They sued the City of Beverly Hills for inverse condemnation, seeking damages and injunctive relief for the view obstruction as a result of coastal redwood trees that the City planted in Roxbury Park.  The plaintiffs specifically alleged that the trees blocked their “unobstructed view of the hills of Beverly Hills, the Hollywood Hills, and the Los Angeles basin, including the Hollywood sign, the Griffith Observatory, downtown Los Angeles, and—on a clear day—Mounty Baldy 50 miles away.”

The trial court sustained the plaintiffs’ demurrer, without leave to amend, which the court of appeal affirmed in the reported case.

The bottom line:  The court held that the plaintiffs could not sue the City for the view obstruction because “’[U]nder California law, a landowner has no right to an unobstructed view over adjoining property.’” Boxer v. City of Beverly Hills (2016) 246 Cal.App.4th 1212, 1219 (citing Posey v. Leavitt (1991) 229 Cal.App.3d 1236, 1250).  The general exceptions are view rights provided by local ordinances; CC&Rs or other deed obstructions; and in certain nuisance cases.  Id.

The plaintiffs in Boxer “vigorously” tried to save their claims by arguing that a property owner’s loss of view can be an element of compensable damages in eminent domain cases where there was a physical taking of the claimant’s property.  However, the court rejected that argument because there was no “physical invasion in a tangible manner,” which is the prerequisite for an inverse condemnation claim. The trees were planted on a neighboring property, not on any part of the plaintiffs’ property, nor did the plaintiffs complain “that the trees or debris from the trees physically intrude[d] upon the plaintiffs’ properties. (Id. at 1219). Plaintiffs are merely complaining of their obstructed view rights, which do not constitute physical damage to their properties. Thus, plaintiffs have not set any tangible physical intrusion on their properties.

Presumably, the plaintiffs-homeowners in Boxer have suffered a material loss in their value of their home from the loss of the views. The general common law rule of no view rights and the Boxer case is another reminder to home buyers (and their real estate brokers) to thoroughly research the property’s view rights if the view is an important part of the property’s value, before the sale closes.

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View Rights in the Hollywood Hills (Rising Glen Road and the Beverly Highlands Homes Association)

One of the key features of property in the Hollywood Hills are the incredible city and ocean views enjoyed from most of the lots.  However, many property owners learn after closing that their views are not fully protected.  The time to research a property’s view rights is before closing!

Rising Glenn Road in the Hollywood Hills is one of the areas that provides property owners with express view rights.  The Turner Law Firm has successfully handled a number of view rights and neighbor disputes for property owners there.  Many of these matters have involved developers and/or their attorneys who apparently either misread or ignored the CC&Rs.

Rising Glenn Road and portions of the connecting streets north of Sunset Plaza were developed as the “Beverly Highlands Homes Association.”  The 1952 recorded Declarations of Restrictions (a/k/a CC&Rs) provide view rights by expressly limiting the height of homes and structures to 15′ or 16′ depending on the specific lot.

Beverly Highlands CC&Rs

The properties subject to the Beverly Highlands Homes Association CC&Rs include the lots in these recorded maps:  Tract 17290, 19543, 19229 (and possibly three other Tracts that we are researching with the title company.)

The CC&Rs provided that building plans were to be reviewed by the Association, but the Association was suspended as a corporation on April 2, 1972.  A group attempted to revive the Association in 1989, but in 1999, its Board voted to dissolve it.    In response, a separate group of homeowners called “Committee to Save the Beverly Highlands Homes Association” filed a lawsuit against the Board to enjoin the dissolution, Committee to Save the Beverly Highlands Homes Assn. v. Beverly Highlands Homes Assn. (2001) 92 Cal.App.4th 1247.  In a nutshell, the court rejected the Committee’s attempt to save the Association.

The court did state in dicta that even if the Association is dissolved, the property owners still can enforce the CC&Rs: “Article XVI of the Declaration gives the individual Beverly Highlands property owners the right to enforce the Declaration.”  That provision states: “The provisions contained in the Declaration shall bind and inure to the benefit of and be enforceable by Declarant, the Association, or the owner or owners of any portion of said property, or their and each of their legal representatives, heirs, successors and assignees, and failure by Declarant, or by the Association, or by any other property owner, or their legal representatives, heirs, successors or assigns, to enforce any of such conditions, restrictions or charges herein contained shall in no event be deemed as a waiver of the right to do so hereafter.”

California law generally provides that CC&Rs can be directly enforced by individual property owners in the tract, unless the CC&Rs states otherwise.  (See, Civil Code §5975, but that statute applies to CC&Rs for common interest developments that are subject to the Davis Striling Act.   Many developments or tracts, particularly in the Hollywood Hills area and the Santa Monica Mountains, from Hollywood to Pacific Palisades, are not common interest developments, and thus not subject to the Davis Striling Act.  The court in Committee to Save the Beverly Highlands Homes Assn.  held that it was not common interest development:  “Accordingly, we must conclude that the Beverly Highlands has no common area within the meaning of Civil Code section 1351, subdivision (b). Therefore, the Davis-Stirling Act does not apply to it.”  Id., at 1271.  The court has similarly held that the Mount Olympus tract and Cloverdale, Terraza, Stillwater, Weatherford Homeowners Association in Baldwin Hills are not common interest developments.  See, Mount Olympus Property Owners Assn. v. Shpirt (1997)  59 Cal.App.4th 885; Tract 19051 Homeowners Ass’n v. Kemp (2015) 60 Cal.4th 1135.)

If you live on or near Rising Glenn or are considering building there, the property may be subject to specific view rights and building limits that are still enforceable even though the Association was dissloved long ago.   Like most real estate law issues, it best to consult with an experienced attorney before making any major development or land use decisions.

(The Turner Law Firm is one of the leading view rights law firms in California.  It has handled hundreds of view rights cases and many more neighbor and land use disputes.)

 

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Anti-SLAPP and HOA Disputes

Colyear v. Rolling Hills Community Association of Rancho Palos Verdes (2017) 9 Cal.App.5th 119 is a recent example of an anti-SLAPP motion being a very powerful defense weapon in HOA litigation.

The term “SLAPP” means “Strategic Lawsuits Against Public Participation,” which includes a lawsuit based on conduct in furtherance of the exercise of free speech regarding an issue of “public interest.”  (Code of Civil Procedure §425.16.)   California law provides that a defendant can seek to immediately strike such a lawsuit and if the defendant’s anti-SLAPP motion is granted, the statute provides that the prevailing defendants is entitled to its attorney’s fees and costs incurred in bringing the motion.  A SLAPP lawsuits are considered to be “generally meritless suits brought primarily to chill the exercise of free speech or petition rights by the threat of severe economic sanctions against the defendant, and not to vindicate a legally cognizable right.”

Colyear and other cases provide chilling examples of how the anti-SLAPP motion procedure has been used to squash homeowners seeking judicial relief from allegedly out of control HOA boards of directors or disputes with other homeowners (members).

Facts

Colyear arises from homeowner defendant Yu Ping Liu’s “Application for Assistance to Restore View” that he with the HOA, because the view from his residence was obstructed by several trees and hedges.   The CC&Rs provided that the HOA had “the right at any time to enter on or upon any part” of a property subject to that declaration “for the purpose of cutting back trees or other plantings which, in the opinion of the [HOA], is warranted to maintain and improve the view of, and protect, adjoining property.”  Liu believed that the trees in question  were on the property immediately north of Liu’s property, which was owned by Richard and Kathleen Krauthamer.  However, plaintiff Richard Colyear alleged that the trees were in fact on his property, which was directly east of the Krauthamer’s property, and kitty-corner to Liu’s property.  Liu, Colyear, and the Krauthamers are all members of the HOA.

Two months after the Application was filed, Colyear filed a lawsuit against Liu and the HOA Board.  Colyear alleged that two of the offending trees were actually on his property, that the relevant tree-trimming CC&R provision covenant did not encumber his property, and therefore that Liu and the HOA were wrongfully clouding his title.

One month after being sued, Liu withdrew his Application.  As a result, the HOA never issued any decision on the Application. Following the withdrawal, the HOA had no pending applications involving either Liu or Colyear’s property.

Colyear’s operative verified complaint “for Declaratory Relief, Injunctive Relief, To Quiet Title, and for Damages” sought a declaration, among other things, that Colyear’s lot was not subject to the tree-trimming CC&R provision; and that a specific HOA Board’s Resolution was void to the extent it purported to enforce such tree-trimming covenant.   The complaint sought to quiet title to Colyear’s lot that it was not covered by the trees tree-trimming CC&R provision.  Finally, the complaint sought injunctive relief barring defendants from seeking to enforce the relevant covenant against Colyear’s lot.  The plaintiff also claimed compensatory and punitive damages from the HOA and the board for alleged fraud and breaches of fiduciary duties.

Liu filed an anti-SLAPP motion to strike Colyear’s complaint, which the trial court granted and court of appeal affirmed.

Decision

The main issue in the report court of appeal decision was whether Colyear’s claim arose from “protected activity.”  The anti-SLAPP motion procedure applies to a lawsuit based on a statement made in connection with “an issue of public interest.”  (Code of Civil Procedure §425.16(e)(4).)

California caselaw holds that “‘public interest’ within the meaning of the anti-SLAPP statute has been broadly defined to include, in addition to government matters,  ‘“private conduct that impacts a broad segment of society and/or that affects a community in a manner similar to that of a governmental entity.” ’ Thus, “several courts have found protected conduct in the context of disputes within a homeowners association.”  Colyear, suppra, at 131; see e.g., Ruiz v. Harbor View Community Assn. (2005) 134 Cal.App.4th 1456, 1468, Country Side Villas Homeowners Assn. v. Ivie (2011) 193 Cal.App.4th 1110, 1113; Damon v. Ocean Hills Journalism Club (2000) 85 Cal.App.4th 468, 479; Lee v. Silveira (2016) 6 Cal.App.5th 527, 540; Talega Maintenance Corporation v. Standard Pacific Corporation (2014) 225 Cal.App.4th 722, 729.

The court rejected Colyear argument that Liu’s application was just a private tree-trimming dispute between two neighbors and therefore does not qualify as a matter of “public interest.”  The court rejected that the argument because Liu’ application evidenced that there was an ongoing controversy, dispute, or discussion regarding the applicability of tree-trimming C&R provision and the HOA’s authority to enforce it.  Furthermore, the issue was an ongoing topic of debate between the board and homeowners, resulting in multiple hearings, letters, and several changes to the board’s policy on the matter starting as early as 2002 and continuing up to the current dispute. In this context, Liu’s application sought to invoke the HOA process at the center of that dispute.

(The reported decision further discussed: Claim Arises From Protected Activity; and Colyear Cannot Demonstrate a Probability of Prevailing Against Liu.)

 

On the one hand, the case seems to be chilling use of the anti-SLAPP procedure to preclude the right to resolve a CC&R/HOA related disputed by litigation.   We can appreciate plaintiff Colyear’s desire to obtain judicial relief for the ongoing dispute regarding the CC&R’s tree trimming provision and the HOA’s right or power to enforce it.    But obviously the case would have had a different outcome if Colyear would have pursued the HOA’s “dispute resolution process.”   California’s HOA laws (the Davis-Stirling Act) contain several sections that sometimes require the use of the dispute resolution process before litigation can be filed.  Civil Code section 5905 requires that associations provide a “fair, reasonable, and expeditious procedure for resolving a dispute” with members.

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HOA Board of Directors have a duty to act with reasonable diligence in the performance of director duties.

By Keith Turner and Justin Escano

 

Palm Spings Villas II v. Parth is a another example of what can happen when an HOA board member “goes rogue” and tests the limits of the so-called “business judgment rule,” which HOA board members sometimes naively believe  immunizes their conduct from personal liability.  The court held that an HOA director can be held personally liable for failing to act with reasonable diligence in the performance of director duties.

This case is important reminder that HOA board members’ authority is also limited by the governing documents, the CC&Rs and by-laws.

In this case, the HOA itself sued Erna Parth, the HOA president and a member of the board of directors, for a number of questionable actions she took on behalf of the HOA:

Parth hired a roofing company to perform roofing repairs, without notice or approval by the Board, after the Board had already approved and hired a different roofing company for the same repairs.  She did not confirm whether the company held a roofing license.

Parth signed three promissory notes totaling $1.775 million, secured by HOA assets and property, for a project to repave walkways and other repairs. She did not give notice or obtain approval by the board for obtaining the loans; and she did not review the CC&Rs or Bylaws to determine whether she had authority to execute the promissory notes; but she believed she had the authority to do so. Under the governing documents, a vote of the majority of the members was required to use HOA assets as security for the loans; however, she did not know such a vote was required

Parth hired landscaping  company to a 5-year contract; however, under the Bylaws, a majority vote of the members was required to enter into a services contract for longer than a year. She also hired a new management company, even though the existing company had not yet been terminated by the Board, and the Board agreed not to terminate the company until they received bids from other management companies.

Finally, Parth secretly renewed a 1-year contract with their existing security company, even though the Board was actively obtaining bids from other security companies. She did not disclose the 1-year renewal with the new company. When the HOA Board hired a different security company, the existing company sued for breach of contract, which led to the HOA’s cross-complaint against Parth.

At deposition, Perth repeatedly admitted that she had no understanding of what her actual scope of authority was as the HOA President and a board member, and that she never reviewed the governing documents to find out.

Parth’s main defense from personal liability was the  business judgment rule. Although the business judgment rule applies generally to all corporations, the California Corporations Code has special sections for volunteer directors of nonprofit organizations. At issue in Palm Springs Villas II, was the section governing volunteer directors and officers of mutual benefit corporations, Corp. Code § 7231.5.  Under the business judgment rule, an HOA director will not be held personally liable in  the performance of their duties. Even if a director breaks HOA rules, or otherwise makes unsound business decisions, that director will not be personally liable as long as they acted in good faith, in the best interests of the HOA, and based on reasonable inquiry. The business judgment rule is intended to allow board members to make important decisions, including those that may pose some risk to the HOA; without it, directors would be paralyzed by the fear of being held personally liable for acting on behalf of the HOA.

However, the business judgment rule has its limits. It will not protect a director who fails to exercise reasonable diligence, fails to conduct a reasonable investigation, or otherwise acts in bad faith in the performance of director duties.

In Palm Springs Villas II, the court of appeal held that the business judgment rule did not automatically shield Perth from liability, because there were material issues of fact as to whether Perth exercised reasonable diligence and conducted reasonable investigations in the performance of her duties. Parth repeatedly stated at deposition that, before she engaged in these activities, she did not know whether she had the authority to do so. Further, she did not make any efforts to review the governing documents to determine whether her actions needed approval by the Board or by the shareholders. Finally, Parth failed to conduct reasonable investigations and basic inquiries, such as whether the roofing company she hired had a roofing license. According to the court, these failures to investigate amounted to “willful ignorance,” and created an issue of material fact as to whether Parth acted with reasonable diligence. The court even suggested that Parth’s failures could amount to bad faith conduct. As explained by the court, “Permitting directors to remain ignorant and to rely on their uninformed beliefs to obtain summary judgment would gut the reasonable diligence element of the rule and, quite possibly, incentivize directors to remain ignorant.”

Palm Springs Villas II is a good reminder to HOA directors that they have a duty to act exercise diligence when attending to the property’s needs. HOA directors cannot simply hide behind the business judgment rule. The case is good example for disgruntled unit owners to challenge the ineptitude and incompetence of HOA directors, and to remind them to do their duty.

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Fence, Tree, and Hedge Height Law

By Keith Turner and Justin Escano

Fence, Tree, and Hedge Height Law

  1. Is property subject to CCRs or other recorded property specific restrictions?
  2. Local zoning – Los Angeles Municipal Code provisions
  3. Spite fence law

  1. Is property subject to CCRs or other recorded property specific restrictions?

 Obtain title report.  Many properties, particularly in tracts north of Sunset, are subject to recorded CC&Rs (conditions, covenants, and restrictions), DORs (declarations of restriction) or similar recorded restrictions which limit heights of fences, trees, etc.  For instance, some of the Marquez Knolls CC&Rs limits boundary fences and walls to a height of three feet.   (Tract 2622, ¶14)

  

  1. Local zoning, Los Angeles Municipal Code provisions

The Los Angeles Municipal Code defines the terms “fence” and “wall” to include: latticework, ornamental fences, screen walls, hedges or thick growths of shrubs or trees.

First, determine the property’s zoning: ZIMAS

  • Zoning
  • Hillside Area (Zoning Code)
  • Other

Second, the basic rules from Los Angeles Municipal Code §12 22.C.20.(f) (check the Ordinance for updates/changes) :

  • FRONT YARD FENCES: in most residential areas, fences, hedges, trees are limited to 3.5′ in height in the front yard.
  • SIDE YARDS, REAR YARDS AND OTHER SPACES: 6′ or 8′ depending on property’s zoning. For example:
    • 8 ft. maximum height – R zoned property, if lot width is 40 ft. or greater and not in hillside area.
    • 6 ft. maximum height – R zone if lot width is less 40 ft
    • 6 ft. maximum height – R zone, hillside area.

See LAMC §12.22.C.20.(f)(3) for full text of law and height limits in other property zones (which is below).

Third, how measured:

  • The Ordinance states: “Fence and wall height shall be measured from the natural ground level adjacent thereto.”
  • BUT see LADBS, INFORMATION BULLETIN / PUBLIC – ZONING CODE

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  1. Spite Fence Law

What is a spite fence?

California spite fence law starts with Civil Code section 841.4. It states, “any fence or other structure in the nature of a fence unnecessarily exceeding 10 feet in height maliciously erected or maintained for the purpose of annoying the owner or occupant of adjoining property is a private nuisance.” The statute is not limited to traditional fences. In Wilson v. Handley (2002) 97 Cal.App.3d 1301, the Court of Appeals held that trees and hedges planted in a row to form a barrier may be deemed a spite fence. The court agreed in Vanderpol v. Star (2011) 194 Cal.App.4th 385, finding that at row of pine trees planted along a neighbor’s boundary line could be considered a spite fence for the purposes of the statute.

The court in Wilson v. Handley expanded the definition of a “structure in the nature of a fence.” Defendants argued that a row of trees was a not a “structure”, and thus could not come under Section 841.4. The court, however, defined a fence as  a “structure … erected … to separate two contiguous estates,” and “a barrier intended … to mark a boundary.” Ultimately, the court concluded that, in light of the purpose of the spite fence statute, the term “fence” should be liberally construed. By this reasoning, other non-traditional fence-like structures may come under the California spite fence statute.

The Los Angeles Municipal Code has its own spite fence statute. LAMC Section 41.30 states, “”No person shall maliciously construct, erect, build, plant, cultivate or maintain any fence or wall or any hedge or similar growth unnecessarily exceeding six (6) feet in height, for the purpose of annoying the owners or occupants of adjoining property.”

How do you prove it?

Both the California and Los Angeles spite fence statutes require a showing that the fence was “maliciously” constructed or maintained. Courts generally use the “dominant purpose” test to determine malice. Under that test, if the dominant purpose in constructing or maintaining the fence was to annoy a neighbor, then malice may be found. However, if there is another dominant purpose for the fence, such as to maintain the aesthetic qualities of one’s property or to protect one’s own privacy, then there is no malice. Since every dispute is different, the question of malice must be answered on a case-by-case basis.

The California spite fence statute also requires a showing of damages. In Vanderpol v. Starr, the jury originally awarded damages for the reduction of property value caused by a neighbor’s spite fence. On appeal, however, the court says this loss of property value was the wrong measure of damages.  Instead, the California spite fence statue requires injury to the “comfort or enjoyment” of one’s property. The court likened the spite fence statute to other nuisance statutes, which similarly require that the complaining party was “injuriously affected” or have his or her “personal enjoyment [] lessened by a nuisance.”

How do you enforce it?

The California spite fence statute includes a right of enforcement for private citizens. It states that any person may enforce the statute by filing a civil action, pursuant to Civil Code section 3501.

Unlike the California statute, the LAMC spite fence statute does not explicitly include a right of enforcement by private citizens. However, under California Government Code section 36900, a private citizen may still be able to sue for violations of the LAMC.

Section 36900 states that violation of a city ordinance may, “be prosecuted by city authorities in the name of the people of the State of California, or redressed by civil action” (Emphasis added). In Riley v. Hilton Hotels Corp. (2002) 100 Cal.App.4th 599, 607, the court held that Section 36900 allowed a private individual to sue for an alleged violation of the Beverly Hills Municipal Code. Thus, a homeowner may still be able to sue for violation of the spite fence statute in the Los Angeles Municipal Code, or other local codes and ordinances.

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Homeowners of Encino – Zoning Primer

The Homeowners of Encino’s website features an detailed introduction to zoning and planning in Los Angeles: A BRIEF PRIMER ON LAND-USE TERMINOLOGY . Thanks to Gerald A. Silver for letting us link to his excellent article.

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Recent Developments in Neighbor vs. Neighbor Encroachment Related Disputes

By: Keith J. Turner and Angelica J. Varela

Sometimes the development and use of property goes beyond the property line, such as driveways and landscaping improvements, which are called “encroachments.”   (An “encroachment” is the extension of a building or other structure beyond the boundaries of the land on which it was rightfully constructed onto adjoining land, or into its airspace, without the permission or consent of the adjoining landowner.)   Encroachments are often discovered when a land survey is done by a property owner when submitting a new property improvement, such as when a property owner wants to add a swimming pool or home addition.  The law provides that such use and development can sometimes ripen into property rights; and, sometimes it does not.  Some recent cases highlight that the analysis can be complex and it is important for property owners to timely assert their rights, or they risk essentially losing a piece of the land.

  • Equitable easement doctrine: you may be stuck with an encroachment. California courts have discretionary authority to deny a landowner’s request to force removal of a neighbor’s encroachment and instead force the landowner to accept damages as compensation for the judicial creation of an easement over the trespassed-upon property if three elements are proven: (1) the trespass was “ ‘innocent’ ” rather than “ ‘willful or negligent,’ ” (2) the public or the property owner will not be “ ‘ “irreparabl[y] injur[ed]” ’ ” by the easement, and (3) the hardship to the trespasser from having to cease the trespass is “ ‘ “greatly disproportionate to the hardship caused [the owner] by the continuance of the encroachment.”

In Shoen v. Zacarias (2015) 237 Cal.App.4th 16, the dispute was over 481 square foot flat patch of land between two hillside properties.   When the defendant purchased her property in 2003, she thought the patch was on her property and populated it with outdoor furniture—a cabana, a chaise chair, tables, and stools; none of it is set in concrete.  But in 2005, the plaintiff’s predecessor land surveyed the boundaries and discovered that the patch belonged to him, but told the defendant she could continue to use it for as long as he owned the property.   However, in 2006, the plaintiff purchased the property and in 2011, she demanded demand that the defendant remove the furniture, even though the plaintiff could not reach the flat patch of land without a building a staircase that would cost $100,000 to build.

The trial court granted the defendant an equitable easement but the court of appeal reversed, holding that a trial court has the power to issue an equitable easement authorizing a trespasser to continue her trespass in exchange for paying damages, but only if, among other things, the hardship on the trespasser in ceasing the trespass is “greatly disproportionate” to the hardship on the land’s owner in losing use of the trespassed upon portion of her land.  Because removing the furniture would only cost $275, the court held that the defendant was not entitled to an equitable easement because hardship was not “greatly disproportionate” on the defendant.

Shoen is important because the court rejected the lesser criteria of “balancing of conveniences” or “relative hardships” as the basis to determine equitable easement rights.  Rather, the court held that the encroacher to prove that ordering removing of the encroachment would be “greatly disproportionate to the hardship caused [the owner] by the continuance of the encroachment.”

  • Parole License: verbal encroachment agreements may be enforceable

An “easement” is generally defined as the right to use someone else’s property for a specific purposes, such as access, and an easement is considered to be interest in real estate, giving the holder a right to bring a suit for trespass or ejectment. Because it is an interest in the property itself, it is subject to the statute of frauds, so it must be granted in writing.   In contrast a “license” allows its holder to perform some act on property of another, or use the property in some way. It gives the holder a personal privilege, but not an interest in the land itself.  Licenses are usually revocable.

In Richardson v. Franc (2015) 233 Cal.App.4th 744,  the dispute was whether a neighbor exceeded the scope of an express easement for access and utility purposes over a shared driveway, buy installing and maintaining landscaping, irrigation, and lighting.  The trial court ruled—irrespective of the terms of the easement—it would be inequitable to deny respondents an irrevocable license given their substantial investment of time and money on the landscaping and other improvements and the burdened property owner’s years of acquiescence.

Richardson is a major case because licenses are usually revocable, but the court held it was irrevocable and it held that it ran not only in favor of the present owners, but also to their successor-in-interest.   Hence, the court granted essentially a permanent right that runs with the land, the way an easement does.

This case also makes the analysis more difficult and harder to predict outcomes in these neighbor vs. neighbor encroachment related disputes.  The court in  Richardson discussed in great detail all of the landscaping and other improvements that were made over the years and how the burdened property benefitted from letting the easement holder do all the work and pay for all the decades of landscaping and water bills.  So having good evidence such as photos and receipts to build a case fairness and balancing the equities can be the key fact.

 

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