Accetta v. Brooks Towers Residences Condo. Ass'n, Inc.

• Decision Date: 09 December 2021
• Docket Number: Court of Appeals No. 20CA0690
• Citation: 506 P.3d 857
• Parties: Anthony T. ACCETTA and Nancy Accetta, Plaintiffs-Appellants, v. BROOKS TOWERS RESIDENCES CONDOMINIUM ASSOCIATION, INC., a Colorado nonprofit corporation; Mark Trenka in his official capacity as a member of the Board of Directors of Brooks Towers Residences Condominium Association, Inc. ; Marla Grant in her official capacity as a member of the Board of Directors of Brooks Towers Residences Condominium Association, Inc.; Bill Clarke in his official capacity as a member of the Board of Directors of Brooks Towers Residences Condominium Association, Inc.; Clay Courter in his official capacity as a member of the Board of Directors of Brooks Towers Residences Condominium Association, Inc.; Robb Green in his official capacity as a member of the Board of Directors of Brooks Towers Residences Condominium Association, Inc.; and Joan Foster in her official capacity as a member of the Board of Directors of Brooks Towers Residences Condominium Association, Inc., Defendants-Appellees.
• Court: Colorado Court of Appeals

506 P.3d 857

Anthony T. ACCETTA and Nancy Accetta, Plaintiffs-Appellants,

v.BROOKS TOWERS RESIDENCES CONDOMINIUM ASSOCIATION, INC., a Colorado nonprofit corporation; Mark Trenka in his official capacity as a member of the Board of Directors of Brooks Towers Residences Condominium Association, Inc. ; Marla Grant in her official capacity as a member of the Board of Directors of Brooks Towers Residences Condominium Association, Inc.; Bill Clarke in his official capacity as a member of the Board of Directors of Brooks Towers Residences Condominium Association, Inc.; Clay Courter in his official capacity as a member of the Board of Directors of Brooks Towers Residences Condominium Association, Inc.; Robb Green in his official capacity as a member of the Board of Directors of Brooks Towers Residences Condominium Association, Inc.; and Joan Foster in her official capacity as a member of the Board of Directors of Brooks Towers Residences Condominium Association, Inc., Defendants-Appellees.

Court of Appeals No. 20CA0690

Colorado Court of Appeals, Division VI.

Announced December 9, 2021

As Modified on Denial of Rehearing January 13, 2022

As Modified February 10, 2022

Foley & Mansfield, PLLP, Dustin J. Priebe, Englewood, Colorado; Podoll & Podoll, P.C., Robert C. Podoll, Greenwood Village, Colorado, for Plaintiffs-Appellants

Nemirow Perez, P.C., Ronald H. Nemirow, Miles Buckingham, Lakewood, Colorado, for Defendants-Appellees

Opinion by JUDGE FOX

¶ 1 The litigation giving rise to this attorney fees and costs appeal invoked the Colorado Common Interest Ownership Act (CCIOA), sections 38-33.3-101 to - 401, C.R.S. 2021, which governs the creation and operation of common interest communities in the state. See Accetta v. Brooks Towers Residences Condo. Ass'n , 2021 COA 87, 496 P.3d 821. In this challenge to the attorney fees and costs awarded in the merits litigation, we consider whether section 38-33.3-123(1)(c), C.R.S. 2021 — which requires a court to award reasonable attorney fees and costs to the prevailing party "[i]n any civil action to enforce or defend the provisions of [CCIOA] or of the declaration, bylaws, articles, or rules and regulations" — applies to a civil action concerning a common interest declaration that predates CCIOA.

¶ 2 We conclude that it does because CCIOA incorporates section 38-33.3-123 to pre-existing communities "with respect to events and circumstances occurring on or after July 1, 1992." § 38-33.3-117(1)(g), C.R.S. 2021. Therefore, we affirm the district court's award of attorney fees to Brooks Tower Residences Condominium Association, Inc., and the named members of its board of directors (collectively, the Association) in the underlying case.¹ We also grant the Association its appellate attorney fees and remand the case to the district court to determine and award such fees.

I. Factual Background

¶ 3 Anthony T. and Nancy Accetta own a unit in Brooks Tower, a condominium building in downtown Denver with almost 900 units. The Accettas’ litigation invoked CCIOA against the Association after they discovered that they were paying fifty percent more in common expenses than the owners of similar units in Brooks Tower.

¶ 4 Under the Association's governing declaration for Brooks Tower, the Accettas pay higher monthly dues and are assessed higher amounts for large projects than many other unit owners.

¶ 5 The Accettas sued the Association under CCIOA and argued that the statute requires the allocation of all common expenses by formula and prohibits unconscionable provisions. The Accettas requested that the court declare the Association's current allocation of common expenses invalid and award them their past overpayments.²

¶ 6 The Accettas requested summary judgment on their declaratory judgment claim, arguing that CCIOA applied and that Brooks Tower was a pre-CCIOA community (also known as a common interest community) because it was created before July 1, 1992. The district court ruled that the Association was governed not by CCIOA, but by the Condominium Ownership Act (COA), sections 38-33-101 to - 113, C.R.S. 2021.

¶ 7 Importantly, the COA does not provide for the recovery of attorney fees. Because of this, the Association moved to recover its attorney fees and costs under CCIOA section 38-33.3-123(1)(c), which applies to pre-CCIOA condominiums via section 38-33.3-117.

¶ 8 The district court ordered the parties to brief the interaction of sections 38-33.3-123 and -117. It then held a hearing on the matter. After considering the briefs and the evidence, the court awarded attorney fees to the Association pursuant to section 38-33.3-123(1)(c) of CCIOA, despite ruling that CCIOA did not govern the declaration. Concluding that the attorney fees provision applied to "pre-CCIOA" communities through section 38-33.3-117(1), the district court awarded attorney fees of $79,885.50 and costs of $3,447.89 to the Association.

¶ 9 The Accettas appeal the district court's order awarding attorney fees to the Association.

II. Analysis

¶ 10 The Accettas contend that the district court erred in three ways when it awarded attorney fees to the Association:

• by awarding fees under CCIOA despite concluding that the Association's declaration was governed by the COA;

• by awarding fees in excess of $10,000 — the amount of the Association's legal insurance deductible; and

• by including fees the Association incurred in connection with its unsuccessful joinder argument in the fee award.

¶ 11 We disagree with the Accettas’ contentions. We first conclude that the district court properly awarded fees under CCIOA to the Association for its successful defense of the Accettas’ claim under the statute. Second, we conclude that the awarded fee amount was proper regardless of the Association's insurance deductible. And finally, we conclude that the district court did not abuse its discretion in including the fees incurred for the unsuccessful efforts to join individual unit owners in the litigation.

¶ 12 We therefore affirm and remand the case to the district court to determine the amount of reasonable attorney fees to award the Association on appeal.

¶ 13 We now turn to each contention below.

A. Recovery of Attorney Fees Under CCIOA

¶ 14 First, the Accettas contend that because the Association prevailed on its theory that Brooks Tower was not governed by CCIOA, and instead by the COA, they are not entitled to fees under CCIOA. We disagree that the Association is barred from fee recovery under CCIOA after defending against an action brought under CCIOA.

1. Legal Principles

¶ 15 CCIOA is intended "to establish a clear, comprehensive, and uniform framework for the creation and operation of common interest communities." § 38-33.3-102(1)(a), C.R.S. 2021. CCIOA applies in its entirety to common interest communities "created" after its effective date of July 1, 1992. § 38-33.3-115, C.R.S 2021. It generally does not apply to communities created before its effective date except as section 38-33.3-117 provides. § 38-33.3-117(3) ; see also DA Mountain Rentals, LLC v. Lodge at Lionshead Phase III Condo. Ass'n , 2016 COA 141, ¶ 28, 409 P.3d 564 ; Giguere v. SJS Fam. Enters., Ltd. , 155 P.3d 462, 467 (Colo. App. 2006).

Except as provided in section 38-33.3-119, the following sections apply to all common interest communities created within this state before July 1, 1992, with respect to events and circumstances occurring on or after July 1, 1992 ....³

§ 38-33.3-117(1) (emphasis added).

¶ 16 Subsection (1)(g), in turn, makes common interest communities created before the effective date of CCIOA subject to section 38-33.3-123, the fee-shifting provision. And section 38-33.3-123(1)(c) requires:

In any civil action to enforce or defend the provisions of this article or of the declaration, bylaws, articles, or rules and regulations, the court shall award reasonable attorney fees, costs, and costs of collection to the prevailing party.

(Emphases added.)

¶ 17 We review the interpretation of statutes de novo. Nesbitt v. Scott , 2019 COA 154, ¶ 16, 457 P.3d 134. When interpreting statutes, we give effect to their plain and ordinary meaning. Id. at ¶ 20. Our aim in construing a statute is to give effect to the General Assembly's intent.

Hernandez v. Ray Domenico Farms, Inc. , 2018 CO 15, ¶ 6, 414 P.3d 700.

2. Governing Statutory Provisions

¶ 18 After finding that the COA, not CCIOA, governed the dispute, the district court ruled that certain sections of CCIOA applied to the Association's declaration. Specifically, the district court concluded that section 38-33.3-117(1) applied CCIOA's prevailing party attorney fees provision, section 38-33.3-123(1)(c), to "events and circumstances" that occurred between June 30, 1992, and January 1, 2006 — even for communities governed by the COA. After making that distinction, the district court ruled that the pertinent events here — the 1995 amendment to the declaration and the Accettas’ 2005 purchase of their unit — were within that timeframe.

¶ 19 Because the declaration was updated in 1995 and the Accettas purchased their unit in 2005, we agree that the "events and circumstances" giving rise to the action were within the scope of the stated timeline (June 30, 1992, to January 1, 2006). See § 38-33.3-117(1).

¶ 20 The Accettas contend, and we agree, that section 38-33.3-123 of CCIOA (which is specified in section 38-33.3-117(1)(g) ) can only supplement the provisions of a declaration in existence as of June 30, 1992. But we are unpersuaded by the Accettas’ argument that Brooks Tower and the Association had no declaration until May 23, 1995 — and the Association therefore was created after the June 30, 1992, supplementation date.

¶ 21 It is true that the Association's predecessors and the former owners of Brooks Towers adopted a new declaration, wholesale, in 1995, but a declaration existed before June 30, 1992. That said declaration was later amended does not render it, or other community documents, void. See B.B. & C. P'ship v. Edelweiss Condo....