(Super. Ct. Nos. SCV19417, TCV949, TCV1156) Superior Court of Placer County, Nos. SCV19417, TCV949, and TCV1156, Scott Snowden, Temporary Judge.
The opinion of the court was delivered by: Robie, J.
CERTIFIED FOR PARTIAL PUBLICATION*fn1
(Pursuant to Cal. Const., art. VI, § 21.). Reversed in part and affirmed in part.
This appeal follows a trial by reference*fn2 of three consolidated cases. The trial court entered judgment against plaintiff Robert Ferwerda, who had been trying to build a home on his vacant lot. He had sued the Bear Creek Planning Committee (the committee) and the individuals who comprised the Bear Creek Valley Board (the board) who he contended inappropriately blocked construction on his lot. He had also sued his next-door neighbors, James and Cindy Ware (the Wares), contending they had violated the covenants, conditions, and restrictions (CC&R's) in building and remodeling their house. Ferwerda appeals from a judgment entered in favor of the committee, the board, and the Wares, which included awards of attorney fees to the committee and the Wares. We affirm the judgment as to the committee and the Wares, except as it relates to the attorney fees. As to those orders, we reverse. Finally, as to the board, we dismiss as moot the appeal relating to it.
FACTUAL AND PROCEDURAL BACKGROUND
Robert Ferwerda owns lot No. 134 in Alpine Meadows Estates Subdivision Unit No. 4 (subdivision No. 4). Since 2001, he has been trying to obtain approval to build a house on his lot. This litigation surrounds events related to securing that approval, interpretation of the CC&R's and related restrictions on the lots in subdivision No. 4, and the resolution of the three cases consolidated in the trial court.
The CC&R's, The Green Book, And
The 2002 Architectural Review Manual
The CC&R's that govern subdivision No. 4 were recorded in 1964 and establish "a general plan for the improvement and development" of the property. The guiding principle is "that it is to the best interest of the area that it be developed into an attractive ski area, alpine in character and appearance, with as little damage to the natural beauty of the land and trees as is possible." To that end, the CC&R's contain several restrictions on the subdivision. Among other things, owners are not permitted to cut down trees over five inches in diameter on their lot without approval from the committee. More generally, owners are required to receive approval from the committee before constructing or excavating on their lot. The owners' plans and specifications and the committee's approval must be "in accordance with the procedures and standards set forth in the Bear Creek Planning Committee Restrictions." The "Bear Creek Planning Committee Restrictions" were incorporated into the CC&R's as exhibit A in 1964.
The committee incorporated in 1978. The articles of incorporation describe the committee's primary purpose as "promoting the social welfare of the community of Alpine Meadows, California and for the mutual benefit of all property owners in that community through supervision and enforcement of the [CC&R's]." Among its powers and duties as articulated in its bylaws is "[t]o review and approve or disapprove plans and specifications for improvements in the Bear Creek Valley pursuant to the CC&R's," "conduct, manage and control the affairs of the corporation and to make such rules and regulations thereof as they may deem appropriate," and "maintain, issue, and revise at its discretion" a procedures, regulations, and standards manual.
In 1990, the committee published the so-called green book that contains procedures, regulations, and standards. The green book notes the observance of objective criteria for plan approval and of subjective criteria guided by a proposed plan's "harmony with the environment in which the structure is placed and harmony with its surroundings." The restriction on tree removal is continued. It recommends use of fire-retardant composition shingles. Finally, it includes the following attorney fees provision: "In the event that it is necessary for the Committee to initiate litigation to enforce the provisions of these Provisions, Regulations, and Standards, then the Committee shall be entitled to recover its reasonable attorneys' fees and costs."
The green book was revised in 2002 and that revision became known as the 2002 architectural review manual. The manual states, among other things, "[t]he design of each structure must bear a harmonious relationship to the land and its neighbor" and live trees cannot be removed without board approval. Similar to the green book, it contains the following attorney fees provision: "In the event that it is necessary for the [committee] to enforce the provisions of the [2002 architectural review manual] by obtaining legal advice to clarify issues, initiate litigation, filing and/or preparing legal documents or filing and preparing a Cease and Desist Order, then [the committee] shall be entitled to recover its reasonable attorney fees and costs from the Performance Deposit or other means as may be deemed necessary. Legal expenses above the performance deposit may be recovered by fines assessed."
Ferwerda's Activities And Resulting Litigation
In 1998, Ferwerda purchased the lot in subdivision No. 4. In November 2001, he submitted his building plans to the committee for preliminary approval. Committee member Donald Priest reviewed Ferwerda's plans. He was concerned with the proposed home's location and configuration on the lot. "What struck [him] . . . was the location of [the] large residence and the long ridge line with respect to [Ferwerda's] neighbors, and in particular the creation of a rather unique alley space between [Ferwerda] and the Wares" that was roughly 17.5 feet wide and up to 70 feet long and had an urban instead of alpine feel. He then looked for a comparable situation in the "valley" but could not find one. Thereafter, Priest made his recommendation to the committee to deny the proposed home, and the committee so voted in December 2001.
Ferwerda appealed the committee's decision to the board, which in March 2002 affirmed the committee's decision on its de novo review.
In November 2004, the committee filed the first of the three consolidated cases, alleging Ferwerda had begun building a home on his lot even though the committee had rejected his plans. The complaint requested, among other things, a temporary restraining order and a preliminary and permanent injunction.
Ferwerda filed a cross-complaint, alleging, among other things, the committee had unreasonably and improperly denied his applications to develop his lot by applying invalid guidelines that had not been properly adopted by the owners of subdivision No. 4. The cross-complaint was for breach of fiduciary duties, declaratory relief, and injunctive relief. Ferwerda later amended his cross-complaint to add the Wares, who he contended had not complied with the CC&R's in building and remodeling their home.
Sometime in 2006, Ferwerda submitted essentially the same plans for his lot he had submitted previously to the committee. The committee denied approval of the proposed home, citing among other things, the alley space problem.
The Wares filed a cross-complaint alleging that Ferwerda had violated the CC&R's in the summer of 2006 by cutting down trees on his lot without the approval of the committee. They requested injunctive relief requiring Ferwerda to replant similar trees and/or forfeit his property to the other owners in subdivision No. 4.
In 2006, Ferwerda submitted to the committee a set of building plans similar to the ones he had submitted in 2001. The committee denied the plans because the proposed home was too close to the Wares' lot. Ferwerda appealed the committee's decision to the board. After a de novo review, the board affirmed the denial in May 2006.
The second case that was consolidated was filed by Ferwerda in May 2006 against each board member individually. He claimed the board's affirmance was "arbitrary, capricious, unreasonable, and lacking in substantial evidence."
In summer 2006, Ferwerda again cut down trees without committee approval and excavated portions of his lot.
The third case that was consolidated was filed by the committee in September 2006. It sought to enjoin Ferwerda from removing trees and excavating his property.
The parties stipulated to a trial by reference. Following an 18-day trial, the court issued its statement of decision.
As to Ferwerda's claims, the court found the following: The committee did not act arbitrarily, capriciously, or with bias when rejecting Ferwerda's construction proposal. Since the committee's actions were reasonable, the issue of whether the board acted properly was moot. The committee had the authority to adopt the green book and other architectural standards. The Wares' home did not violate the CC&R's. As to the committee's claims, the court found the following: The committee had the power to adopt and modify the architectural review standards beyond those set forth in the CC&R's. The court also made permanent the preliminary injunction preventing Ferwerda from excavating on his property or removing trees without committee approval. As to the Wares' claims, the court found Ferwerda was required to replant the trees he had removed if, by June 2010, he had not received approval from the committee for constructing a home on his property. Finally, the court ordered Ferwerda to pay $194,313.51 in attorney fees to the committee and $219,239.06 in attorney fees to the Wares.
Ferwerda appeals from the resulting judgment. He contends: (1) the committee did not have the authority to adopt standards beyond those in the CC&R's; (2) the court erred in awarding attorney fees; (3) the court applied the wrong legal standard when it determined the committee acted reasonably in denying his building plans in 2001; (4) the court erred in imposing a permanent injunction prohibiting him from "any further construction, excavation or alteration to his property without committee approval" and requiring him to replant trees if by June 2010 he had not received approval from the committee for constructing a home on his property; (5) the court's conclusion the Wares had complied with the CC&R's was not supported by substantial evidence; and (6) the board acted arbitrarily and capriciously in affirming the committee's rejection of his plans, and the board was not properly composed. As we explain, as to the committee and the Wares, we reject Ferwerda's contentions except as they relate to the attorney fee awards. As to those awards, we reverse. As to his contentions pertaining to the board, we dismiss as moot the appeal pertaining to it.
The Committee Has The Power To Adopt Standards
Beyond Those Set Forth In The CC&R's
Section 6 of the CC&R's states the committee may act on applications, "all in accordance with the procedures and standards set forth in the Bear Creek Planning Committee Restrictions, a copy of which is attached hereto as Exhibit A and by this reference is made a part hereof. Except as to set-backs (Paragraph 13 hereof), in the event of a conflict between the standards required by said ...