Bd. of Dirs. of Four Directions Park Condominiums Homeowners Ass'n, Inc. v. Casita De Las Flores, LLC

• Decision Date: 12 March 2020
• Docket Number: No. A-1-CA-36435,A-1-CA-36435
• Parties: BOARD OF DIRECTORS OF FOUR DIRECTIONS PARK CONDOMINIUMS HOMEOWNERS ASSOCIATION, INC., a New Mexico nonprofit corporation, Plaintiff-Appellee, v. CASITA DE LAS FLORES, LLC, a New Mexico limited liability company, ASSAF REZONI, f/k/a ASSAF REZNICK, and MICAL REZONI, Defendants-Appellants.
• Court: Court of Appeals of New Mexico

BOARD OF DIRECTORS OF FOUR DIRECTIONS PARKCONDOMINIUMS HOMEOWNERS ASSOCIATION, INC.,a New Mexico nonprofit corporation, Plaintiff-Appellee, v. CASITA DE LAS FLORES, LLC, a New Mexico limited liability company,ASSAF REZONI, f/k/a ASSAF REZNICK, and MICAL REZONI, Defendants-Appellants.

No. A-1-CA-36435

COURT OF APPEALS OF THE STATE OF NEW MEXICO

March 12, 2020

This decision of the New Mexico Court of Appeals was not selected for publication in the New Mexico Appellate Reports. Refer to Rule 12-405 NMRA for restrictions on the citation of unpublished decisions. Electronic decisions may contain computer-generated errors or other deviations from the official version filed by the Court of Appeals.

APPEAL FROM THE DISTRICT COURT OF TAOS COUNTY

Jeff F. McElroy, District Judge

Walcott, Henry & Winston, P.C.

Donald A. Walcott

Santa Fe, NM

for Appellee

Chappell Law Firm, P.A.

Bill Chappell, Jr.

James B. Boone

Albuquerque, NM

for Appellants

MEMORANDUM OPINION

VARGAS, Judge.

{1} Casita de las Flores, LLC (Casita) and Assaf and Mical Rezoni (the Rezonis) (collectively, Defendants) appeal from the district court's judgment for assessments in favor of the Four Direction Park Condominium Homeowners Association's Board of Directors (Plaintiff), as well as the district court's order awarding attorney fees and costs in favor of Plaintiff. On appeal, Defendants raise three challenges to the district court's judgment. First, Defendants claim that the district court's findings of fact related to their obligation to pay assessments are not supported by substantial evidence because those findings, as well as the district court's related conclusions of law, are contrary to the New Mexico Condominium Act and the Amended and Restated Declaration for the Association. Second, Defendants contend that the district court erred when it awarded attorney fees in an amount over four times the amount of the judgment. Third, Defendants argue that the district court erred when it awarded costs in favor of Plaintiff, including double the costs pursuant to Rule 1-068(A) NMRA. We affirm.

BACKGROUND

{2} Four Directions, LLC (the LLC), developed the Four Directions Park Condominiums (the Condominiums) through their limited liability corporation, in 2002. The Rezonis were the sole members of the LLC. As part of the development, the LLC prepared and filed the original condominium declaration for the Condominiums (the Original Declaration), which created the Four Directions Park Condominiums Homeowners' Association (the Association). The Original Declaration recognized twelve condominium units in the Association and gave the Association the power to assess owners of condominium units for payment of all costs for maintenance and upkeep of the condominiums as well as other common area expenses. The Original Declaration provided that Plaintiff was to calculate the assessments annually, allocating costs for both maintenance and common area expenses to the owner of each unit in proportion to the approximate area of each unit.

{3} In 2006 Assaf Rezoni, as managing member of the LLC prepared and filed an amendment to the Original Declaration (the 2006 Amendment), adding a thirteenth studio unit (the Studio Unit) to the Association. The 2006 Amendment provided that the owner of the Studio Unit "shall have voting rights and pay assessment fees in proportion as the area of [t]he Studio [Unit] bears to the total area of the [u]nits[,]" but did not otherwise change the terms of the Original Declaration. In 2008 the Association unanimously passed a resolution (the 2008 Resolution) proposed by Assaf Rezoni, the Association's then-president, changing the manner in which assessments were calculated for the common areas such that each unit would be assessed an equal 1/13th share of the common area expenses.

{4} In 2010 Plaintiff and Rezonis were involved in separate litigation over the Studio Unit that resulted in a settlement agreement (the 2011 Settlement Agreement) that required the Rezonis to purchase the Studio Unit, exempted the owner of the Studio Unit from the payment of maintenance assessments, but required the continued payment for assessments for common area expenses. The Rezonis owned the Studio Unit from September 2011 until October 2012, when they conveyed it to Casita, anotherlimited liability company owned solely by the Rezonis. In 2014 Plaintiff prepared and filed an Amended and Restated Declaration (the 2014 Amendment), which included the terms of the 2011 Settlement Agreement but referenced no other changes to the manner in which assessments were to be assessed. In 2015 Plaintiff sued the Rezonis for unpaid common area assessments from 2011 to 2012 and Casita for unpaid common area assessments from 2012 to 2014, all related to the Studio Unit. The case was tried in 2017, and the district court found in favor of Plaintiff, entering judgment against Defendants for their respective unpaid assessments and awarding Plaintiff its attorney fees and costs. This appeal followed.

DISCUSSION

I. Association Assessments

{5} While somewhat difficult to parse out of their briefing, Defendants appear to make three challenges to the district court's findings and conclusions related to their obligation to pay the Association assessments. First, Defendants argue the district court's finding that the Studio Unit was a part of the Association such that the Rezonis were subject to the common area assessments as owners of the Studio Unit is not supported by substantial evidence. Second, Defendants argue the district court erred in finding that the 2008 Resolution and course of conduct of the parties required Defendants to pay 1/13th of the common area expenses because the Original Declaration was never amended to reflect the 1/13th assessment of the common area expenses, contrary to the Condominium Act, NMSA 1978, Sections 47-7A-1 to 7D-20 (1982, as amended through 2012). Third, Defendants argue the district court erred in failing to consider specific exhibits and the stipulation of the parties that "Defendants [did not] receive[] notice of annual meetings or a proposed budget from Plaintiff between 2001 and 2015[,]" which we understand Defendants contend relieved them of their obligations to pay assessments prior to March 31, 2015.

Standard of Review

{6} As these arguments present mixed questions of law and fact, "we use the substantial evidence standard for review of the facts and then conduct a de novo review of the trial court's application of law to those facts." Allen v. Timberlake Ranch Landowners Ass'n, 2005-NMCA-115, ¶ 13, 138 N.M. 318, 119 P.2d 743. "Substantial evidence is such relevant evidence that a reasonable mind would find adequate to support a conclusion." State ex rel. King v. B & B Inv. Grp., Inc., 2014-NMSC-024, ¶ 12, 329 P.3d 658 (internal quotation marks and citation omitted). "In reviewing a sufficiency of the evidence claim, this Court views the evidence in a light most favorable to the prevailing party and disregards any inferences and evidence to the contrary." Charles v. Regents of N.M. State Univ., 2011-NMCA-057, ¶ 15, 150 N.M. 17, 256 P.3d 29 (alteration, internal quotation marks, and citation omitted). "We will not reweigh the evidence nor substitute our judgment for that of the fact[-]finder." N.M. Taxation & Revenue Dep't v. Casias Trucking, 2014-NMCA-099, ¶ 20, 336 P.3d 436 (alteration, internal quotation marks, and citation omitted).

{7} Before we consider Defendants' specific arguments challenging the district court's findings and conclusions, we note that Defendants argue that we should give the district court less deference than is required under our substantial evidence standard of review because they contend the district court adopted Plaintiff's proposed findings of fact verbatim. Defendants direct this court to cases where we gave less deference to the findings of district courts that copied proposed findings of fact proposed by one of the parties verbatim. However, in those cases, we measured the amount of deference we gave to the district courts only upon a verbatim, or effectively verbatim adoption of extensive requested findings of fact. See Bernier v. Bernier, 2013-NMCA-074, ¶ 15 n.4, 305 P.3d 978 ("The practice of full scale verbatim adoption of extensive requested findings of fact and requested conclusions of law of the prevailing party, especially in complex cases, can cause this Court on appeal to grant less deference to a court's findings of fact and conclusions of law than is otherwise accorded."); see also Los Vigiles Land Grant v. Rebar Haygood Ranch, LLC, 2014-NMCA-017, ¶ 2, 317 P.3d 842 ("[W]e think it appropriate to repeat our continuing concern about the practice of some [district] courts of adopting, verbatim, all or virtually all of a prevailing party's extensive requested findings of fact and conclusions of law in complex cases. . . . This Court looks askance at wholesale verbatim adoption of the prevailing party's extensive requested findings of fact and conclusions of law.") However, in this case, the district court's final order, containing its findings of fact and conclusions of law was not a verbatim, wholesale copy of the Plaintiff's proposed finding of fact. The district court rejected a significant number of the proposed findings offered by Plaintiff and altered and amended many others. The district court also added several additional findings that were not proposed by Plaintiff. Therefore, we reject Defendant's argument that we should limit our deference to the district court's findings of fact and we proceed with our analysis, reviewing the sufficiency of the evidence in a light most favorable to Plaintiff, disregarding any inferences and evidence to the contrary. See Casias Trucking, 2014-NMCA-099, ¶ 20.

Association Membership of the Studio Unit

{8} Defendants first argue the district court erred in concluding that the Studio Unit was a member of the Association such that Defendants were subject to the common area...