After Fourth Lawsuit, Court Says Neither Party Prevailed, Declines To Award Fees, And Tells Parties: “don’t Run To Court. Run To Try To Work Things Out.”

This case involved the fourth lawsuit filed by a condominium owner (“Owner “) against her homeowners’ association (“Association”). In this action, Owner alleged five separate causes of action against Association, which primarily sought injunctive and declaratory relief as to Association’s election and voting rules and its guidelines concerning the sale and leasing of units. The court dismissed two of the five causes of action on preliminary motions, and remaining three causes of action ended up getting dismissed pursuant to agreement of the parties after Association amended the rules and guidelines that were the subject of those causes of action. Following the dismissal of the remaining three causes of action, both sides moved for an award of attorneys’ fees as the prevailing party. The trial court denied attorney fees to both sides, and both sides appealed the court’s ruling.

Each side argued that they were the prevailing party and were entitled to an award in excess of $300,000.00 for attorney’s fees that were incurred in connection with the action, based on the provisions of California Civil Code §5975, which states: “In an action to enforce governing documents, the prevailing party shall be awarded reasonable attorney’s fees and costs.” Said provision is amplified by a further provision contained in the Declaration to the act which states: “The party who prevails in an arbitration, civil action, or other proceeding to enforce or interpret the Governing Documents shall be entitled to recover all costs and expenses, including reasonable attorney’s fees, but the arbitrator, judge or other decision maker shall have final discretion to allocate such costs and expenses between the parties in a manner that will accomplish substantial justice.”

As to Owner, the trial court found: