CHAPALA Mgmt. Corp. v. STANTON

• Decision Date: 29 July 2010
• Docket Number: No. D055532.,D055532.
• Citation: 186 Cal.App.4th 1532,113 Cal.Rptr.3d 617
• Court: California Court of Appeals Court of Appeals
• Parties: CHAPALA MANAGEMENT CORPORATION, Plaintiff and Respondent, v. Thomas STANTON et al., Defendants and Appellants.

186 Cal.App.4th 1532

113 Cal.Rptr.3d 617

CHAPALA MANAGEMENT CORPORATION, Plaintiff and Respondent,

v.Thomas STANTON et al., Defendants and Appellants.

No. D055532.

Court of Appeal, Fourth District, Division 1, California.

July 29, 2010.

COPYRIGHT MATERIAL OMITTED.

Lynn & Fortune, Robert H. Lynn, San Diego; Mugglebee & Mugglebee and Stephen T. Mugglebee, San Diego, for Defendants and Appellants.

Epsten Grinnell & Howell, Rian W. Jones and Carrie M. Timko, San Diego, for Plaintiff and Respondent.

O'ROURKE, J.

Defendants and appellants Thomas Stanton and Donna Stanton replaced two windows in their condominium with “sandtone” colored windows after the condominium association, Chapala Management Corporation (Association), had denied their application for those improvements on grounds they were not an approved color. Association thereafter filed suit and, following a bench trial, obtained a judgment against the Stantons for injunctive and declaratory relief declaring them in violation of Association's amended and restated declaration of covenants, conditions and restrictions (CC & Rs) and requiring them to modify or replace their windows under the approval of Association's architectural review committee (at times hereafter the ARC). The trial court ordered the Stantons to pay attorney fees and thereafter ordered them to post a bond or undertaking to stay the collection of the attorney fee award. The Stantons appealed from the judgment without filing an appeal bond or other undertaking.

On appeal from the judgment, the Stantons contend the trial court erred by (1) granting an injunction when Association had specific and adequate legal remedies under the CC & Rs; (2) ignoring Civil Code requirements granting defendants a hearing before Association's board of directors (the Board); (3) holding that the term “aesthetic” permits the architectural review committee to disregard provisions of the CC & Rs as to window color; and (4) finding that the architectural review committee's actions were not arbitrary, capricious or discriminatory. The Stantons further appeal from the order awarding attorney fees, asking us to vacate the order if they prevail on appeal.

In their subsequently filed writ petition, the Stantons contend an undertaking is not required to stay an award of costs made in connection with a judgment for injunctive relief. They asked for an immediate stay of the order requiring that they post an undertaking. We issued the stay, ordered that the arguments in the petition and response be considered with this appeal, and deferred ruling on the petition until disposition of the appeal.

We affirm the judgment and postjudgment order awarding attorney fees. As we explain below, we dissolve the stay and grant the Stantons' petition for writ of supersedeas.

FACTUAL AND PROCEDURAL BACKGROUND

The factual background is taken from the facts and evidence in the record and the trial court's statement of decision. We view the facts most favorable to the judgment under the principle requiring us to presume the lower court's judgment is correct and draw all inferences and presumptions necessary to support it. ( In re Marriage of Arceneaux (1990) 51 Cal.3d 1130, 1133, 275 Cal.Rptr. 797, 800 P.2d 1227; Ermoian v. Desert Hosp. (2007) 152 Cal.App.4th 475, 494, 61 Cal.Rptr.3d 754.) “ ‘Where [a trial court's] statement of decision sets forth the factual and legal basis for the decision, any conflict in the evidence or reasonable inferences to be drawn from the facts will be resolved in support of the determination of the trial court decision.’ ” ( In re Marriage of Ruelas (2007) 154 Cal.App.4th 339, 342, 64 Cal.Rptr.3d 600.) If the statement of decision is ambiguous or omits material factual findings, we will infer any factual findings necessary to support the judgment. ( Ermoian v. Desert Hosp., at p. 494, 61 Cal.Rptr.3d 754.) ¹ In December 2006, the Stantons, owners of a unit located in the Association, submitted to Association a series of applications seeking the architectural review committee's approval of exterior improvements consisting of the replacement of two casement windows on the south side of their unit, facing the common area. They sought to use windows that were “sandtone” in color.

Association's CC & Rs, recorded in 1996, require that the location and plans and specifications of improvements to any unit's exterior be approved by Association's three-member architectural review committee. ² The CC & Rs state the “ARC shall review and approve or disapprove all plans submitted to it for any proposed improvement, alteration or addition, solely on the basis of aesthetic considerations and the overall benefit or detriment which would result to the immediate vicinity and the Project generally. The ARC shall take into consideration the aesthetic aspects of the architectural designs, placement of buildings, topography, landscaping, color schemes, exterior finishes and materials and similar features....” (CC & Rs, art. XV, § 11.)

Association utilizes a document entitled “Architectural and CC & R Guidelines for Homeowners” (Guidelines) stating that “[a]ll changes or additions either to the exterior of your Living Unit or to your Exclusive Use Area require ARC approval.” In part, the Guidelines state: “No building or other structure or improvement, including landscaping, shall be erected, placed or altered upon any Exclusive Use Area or Common Area nor shall the exterior of any Living Unit be changed or altered unless the ARC has reviewed and approved the changes in accordance with the guidelines.” (Bold and italics omitted.) The Guidelines contain an “Architectural Concept” section that explains that Association's architecture is a homogenous Spanish style reminiscent of California early days, and minor architectural changes may be considered that maintain the integrity of that architectural style. According to the Guidelines, “[a]reas allowing the largest possibility for individual expression are the Exclusive Use Areas appurtenant to the rear of such Living Unit and intended for the exclusive use of its inhabitants. [¶] These areas are actually Common Areas and shall be landscaped and maintained by the home owner.” (Bold and italics omitted.) The CC & Rs define the exclusive use areas.

Before January 2007, Association's architectural review committee had a policy of maintaining a dark shade of brown color for windows that generally faced the street within the community, other than the garage windows. The committee had a different policy with respect to windows that did not face the street. The Stantons were aware of this policy since at least 1999, when the existing architectural review committee denied their application to install sandtone colored windows due to the color variation.

In January 2007, the members of the architectural review committee met with the Stantons at their property and explained that their window color was unacceptable. On January 31, 2007, Association advised the Stantons by letter that their application had been disapproved because, among other deficiencies, the window frame color specified on the application was incorrect. In February 2007, the Stantons submitted two additional applications again requesting approval of sandtone colored windows.

The following month, the Association's manager on the Board's behalf advised the Stantons that the architectural review committee had denied their application “because the casement windows must be brown in color.” In April 2007, Thomas Stanton wrote to Association's legal counsel and, among other things, accused the architectural review committee of acting in an arbitrary and capricious manner in its color approvals. At the conclusion of the letter, he wrote, “New non-standard color windows will be installed in our home this week!” The Stantons thereafter installed the sandtone-colored windows.

In May 2007, Association offered to resolve the dispute with the Stantons through mediation in accordance with Civil Code section 1369.520. The Stantons declined mediation.

Association thereafter filed a verified complaint against the Stantons containing causes of action for declaratory and injunctive relief based on the Stantons' violation of the CC & Rs. It sought a permanent injunction requiring the Stantons to modify their windows by painting them a color approved by the architectural review committee, or alternatively requiring them to remove and replace the existing windows with windows in an approved color after submitting plans and specifications under the Guidelines and obtaining the committee's approval. It also sought a judicial declaration of the rights, duties and obligations of the parties under the CC & Rs pertaining to the Stantons' unit and an order directing them to comply with all other provisions of the CC & Rs. Association prayed for costs and attorney fees.

The matter proceeded to a bench trial, after which the trial court issued a written statement of decision determining Association to be the prevailing party. The court made detailed legal and factual findings in part as follows:

“The Association has maintained a color scheme with approved and recommended colors for windows in the community, which is reflected in Exhibit 21.... [T]he Association's Architectural Guidelines ... reference[ ] the general policy with respect to the ARC and the standards to be maintained within the community.... [¶] ... [T]he color to be applied to the exterior surfaces of the building are included and controlled by both the CC & Rs and derivatively by the Architectural Guidelines.... [¶] ...

“... The windows on the front of the units in Chapala are generally referred to as ‘casement windows,’ all of which were stained and varnished a dark shade of brown upon the original construction of the project. The Association has, over the years, consistently required that the casement windows on the front, street-facing side of the units in...