Citation
Committee to Save Beverly Highlands Homeowners Ass’n. v. The Beverly Highlands Homeowners Ass’n. (2001) 92 Cal.App.4th 1247
Facts
In 1952, CC&Rs were recorded against lots in a development in Beverly Highlands. An association of the owners of the lots was created. Four of the lots in the development were not buildable, and the CC&Rs restricted their use to open space, and obligated the association to maintain them. The association was suspended in 1972, but revived in 1989. In 1996, there was debate over whether the development was subject to the Davis-Stirling Common Interest Development Act (“Davis-Stirling” or “Davis-Stirling Act”), which arose from the fact that the association owned none of the lots. The association decided not the purchase the lots. Subsequently, some of the members determined to dissolve the association. In the face of their actions, a committee of members who opposed the dissolution (“Committee”) filed legal proceedings. Both sides moved for summary judgment, and the court granted the Committee’s request to stay the dissolution of the association. The court based its ruling on a finding that the community was subject to Davis-Stirling, declared plaintiff the prevailing party and awarded attorney fees. On appeal, defendant association contended the project was not subject to Davis-Stirling.
Held
For association (project not subject to Davis-Stirling.) The court first noted that if the association was subject to Davis-Stirling, Corporations Code §8724 would require 100% of the members to consent to dissolution. (A smaller percentage would be required for dissolution if the association was not a Davis-Stirling homeowners association.) However, for a community to be subject to Davis-Stirling, it must have common area. For a planned development, that common area may be either separately owned lots, or easements across other lots for the benefit of members. The CC&Rs did restrict the use of the unbuildable lots, but that was not the equivalent of the easements necessary to bring the project under Davis-Stirling. The court also noted that even if the association were dissolved, individual owners still had the right, pursuant to the CC&Rs, to enforce the CC&Rs.
Keywords: Davis-Stirling Common Interest Development Act, Scope, Application