Rancho Santa Fe Ass'n v. Dolan-King

• Decision Date: 07 January 2004
• Docket Number: No. D040637.,No. D041486.,D040637.,D041486.
• Citation: 8 Cal.Rptr.3d 614,115 Cal.App.4th 28
• Court: California Court of Appeals Court of Appeals
• Parties: RANCHO SANTA FE ASSOCIATION, Plaintiff and Respondent, v. Patricia DOLAN-KING, Defendant and Appellant.

8 Cal.Rptr.3d 614

115 Cal.App.4th 28

RANCHO SANTA FE ASSOCIATION, Plaintiff and Respondent, v. Patricia DOLAN-KING, Defendant and Appellant.

No. D040637.

No. D041486.

Court of Appeal, Fourth District, Division 1.

January 7, 2004.

Rehearing Denied January 28, 2004.

Review Denied April 28, 2004.^*

Robert R. Massey, San Diego, CA, for defendant-cross/complainant-appellant.

Michael J. Hickman, Musick, Peeler & Garrett, Richard L. Boyer, Lucas, Mullaney, Boyer & Haverkamp, San Diego, CA, for plaintiff-cross/defendant-respondent.

Michael J. Hickman, Musick, Peeler & Garrett, Richard L. Boyer, Lucas, Mullaney, Boyer & Haverkamp, San Diego, CA, for cross-defendant and respondent.

HUFFMAN, Acting P.J.

Patricia Dolan-King, a homeowner in the residential community of Rancho Santa Fe, is the defendant and appellant in this action to enforce a protective covenant, brought by the Rancho Santa Fe Association (the Association). The Association obtained judgment in its favor for injunctive and declaratory relief and an award of attorney fees, based on Dolan-King's construction of a fence around her property without the appropriate permits or compliance with other Association regulatory criteria for the definition of "major" or "minor" construction. Dolan-King appeals, contending that the trial court erred in directing a partial verdict on the validity of certain land use regulations enforced by the Association, and that the jury verdict resulting after the partial directed verdict is unsupported by the evidence or the law. She also contends that attorney fees should not have been awarded. (Civ.Code, § 1354, subd. (f).)¹

Our examination of the record leads us to conclude that the trial court was correct in finding the challenged Rancho Santa Fe Regulatory Code provisions (the regulatory code) are valid, concerning the definition of the terms major and minor construction and the subsequent jury verdict is supported by the evidence. We affirm the judgment and order of attorney fees to the Association as the prevailing party.

FACTUAL AND PROCEDURAL BACKGROUND

In 1996, Dolan-King purchased a home on an approximately three-acre lot in Rancho Santa Fe, located at 6840 El Camino Del Norte. Property development in Rancho Santa Fe is subject to the Rancho Santa Fe Protective Covenant (Covenant), adopted and recorded in 1928 and amended at various times over the years. At the time she purchased her property, there was an original three-rail corral-type fence on it. Dolan-King originally proposed extensive remodeling plans (room addition structures) and a reconstructed fence composed of stucco columns joined by horizontal wood beams, and sought the appropriate permits from the Association. The Association reviewed those plans and denied permission to proceed with them. The story of that land use application and its processing by the Association is told in a published opinion, Dolan-King v. Rancho Santa Fe Assn. (2000) 81 Cal.App.4th 965, 97 Cal.Rptr.2d 280 (referred to as our prior opinion or "Dolan-King I").

In that prior action, Dolan-King had sought a judicial determination of the validity and enforceability of certain unrecorded guidelines, which provided the criteria and restrictions used by the art jury of the Association to reject her applications as to both the room additions and the proposed fence project. (Dolan-King I, supra, 81 Cal.App.4th at p. 973, 97 Cal.Rptr.2d 280.) Although Dolan-King had prevailed at trial, on appeal, the Association obtained reversal of that judgment. This court concluded that "the relevant provisions of the protective covenant are enforceable equitable servitudes, and, with regard to Dolan-King's improvement applications, Dolan-King failed to meet her burden to show the Board's decisions were unreasonable and arbitrary under the circumstances." (Id. at p. 970, 97 Cal.Rptr.2d 280.)

While that appeal was pending, Dolan-King caused to be constructed around the perimeter of her property a wrought iron fence approximately five feet in height and 800 feet long, with posts approximately every eight feet. She testified at trial that under her interpretation of paragraph 48 of the Covenant, she thought that this fence constituted minor construction, pursuant to the following Covenant definition: "The building of fences, walls, and similar structures, are divided into two classes: First, major construction; second, minor construction. The property owner may proceed with what he definitely thinks is a minor construction without submitting plans and specifications to the Art Jury as provided above, subject to the continuing jurisdiction of the Association through its Board of Directors to hear complaints against said minor construction...." (Emphasis added.)

The Association, through its manager, sent her a letter June 3, 1999 informing her this fence was major construction under the regulatory code, section 31.0302, and that she should seek a permit or tear down the fence, or be subject to the imposition of a $500 lien for noncompliance with Covenant provisions and the revocation of her privileges to use Association facilities.

When she did not seek a permit or tear down the fence, the Association sent her a notice that a hearing would be held August 5, 1999 before the Board regarding the revoking of her privileges to use Association facilities and the imposition of the $500 assessment. (The lien was released shortly before trial.) That hearing was held and those actions were taken by the Board. The minutes of the Board meetings state that the fence being discussed was not the one involved in the prior litigation, such that there was any approval of it pending that appeal.

The Association then brought this action for injunctive and declaratory relief to have Dolan-King seek the proper permits or remove the fence. Attorney fees were sought under section 1354. She responded with her cross-complaint for breach of contract, breach of fiduciary duty, slander of title, and related relief.

At trial call, various motions in limine were submitted and rulings made. As relevant here, the trial court refused Dolan-King's offer of proof to provide traffic and safety evidence about the traffic in the area of her property as it pertains to fencing.

At the outset of trial, Dolan-King's attorney agreed with the trial court that the validity of the regulatory code was subject to a ruling on its validity as a matter of law, based upon the governing documents of the Association. He argued that the Association had exceeded its powers by enacting the portions of the regulatory code dealing with major or minor construction, in contravention of paragraph 48 of the Covenant. Subsequently, the trial court rendered a statement of decision rejecting this argument and upholding the validity of the pertinent provisions of the regulatory code. This resulted in the entry of a partial directed verdict in favor of the Association. In its order, the court explained its reasoning as follows: Based on the relevant documentary evidence associated with this matter and the argument by the parties, the court found that the fence erected on the Dolan-King's property was "major construction" as that term is used in the Covenant and the regulatory code. Specifically:

"Paragraph 48 of the Rancho Santa Fe Protective Covenant provides: The building of fences, walls, and similar structures, are divided into two classes: First, major construction; second, minor construction. The property owner may proceed with what he definitely thinks is a minor construction without submitting plans and specifications to the Art Jury as provided above, subject to the continuing jurisdiction of the Association through its Board of Directors to hear complaints against said minor construction and to hear, try and determine the said complaints upon due notice to the defending property owner. Tennis courts and swimming pools are major construction."

The order continued, "Section 31.0301 of the Rancho Santa Fe Regulatory Code provides: Fences and Walls. All fences and walls shall constitute `Major Construction.'" (Although the court clearly intended to cite the fence and wall provisions, it erroneously cited to section 31.0301 in this respect; the actual language involved is not disputed and we may properly cite these provisions as shown in the record, section 31.0302.) The trial court then referred to section 31.0302.01 as specifying that "Wooden split-rail fences not exceeding 36" in height, and consisting of two or fewer rails, and which observe all set-back requirements established for structures in the Protective Covenant, shall be considered minor construction."

The trial court then concluded that pursuant to paragraph 48 of the Covenant and section 31.0302.01 of the regulatory code, "the only fence which constitutes `minor construction' is a wood pasture rail fence with two rails, 36" or less in height. Based on the Court's review of the evidence and interpretation of Paragraph 48 of the Rancho Santa Fe Protective Covenant in conjunction with Sections 31.0302 and 31.0302.01 of the Rancho Santa Fe Regulatory Code, the subject fence constructed by defendant Patricia Dolan-King constituted `major construction.'"

The remaining issues of the complaint and cross-complaint, concerning compliance with the Covenant, were then submitted to the jury. It heard testimony and evidence about the Association's procedures used to respond to the building of this wrought iron fence, and Dolan-King's own testimony and expert testimony to support her belief that the fence constituted minor construction. Dolan-King also presented evidence that another landowner (Cloverlane Associates) had received a hearing in 2001 pursuant to paragraph 48 of the Covenant, when objections to a fence it built were raised. She argues that she had been subject to disparate treatment, because the Cloverlane fence issues had been dealt with more formally.

After deliberations, the jury...