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Did The Trial Court Err? - Part VI

Contributed by: Jan Jackson on 7/9/2008

Part VI of Jan Jackson's attorney's Opening Brief in the Colorado Appeals Court concerns her attorney's argument that awarding attorney's fees to Jan's HOA (after a trial in the District Court in Cripple Creek, Colorado) finds no justification in either CCIOA (the Colorado Common Interest Ownership Act) or the covenants , and that those attorneys fees, therefore, are not recoverable by her HOA. (see below)

V. ATTORNEYS' FEES

The trial court awarded the Association its attorneys' fees "in seeking an injunction both under the terms of the covenants (to assure quiet enjoyment) as well as the provisions of CCIOA which permit the award of attorneys' fees in covenant enforcement actions" (App., pp. 5-6). Previously, in the last paragraph of section 1 of the court's order (App., p.2), the court awarded the Association its attorneys' fees "in defending the Plaintiff's claim" under CCIOA [Colorado Common Interest Ownership Act], Section 38-33.3.123(1)(c).

Jackson's complaint sought only a declaration that the 2005 assessments, particularly the one seeking "closure" against her, were invalid. CCIOA Section 38-33.3.123(1)(c) allows attorneys' fees in actions "to enforce or defend the provisions of this article, or the declaration, bylaws, articles, or rules and regulations . . . ." The Association has never accused Jackson of a covenant violation. Tr., Vol. 1, p. 64, ll., 8-13. Rather, the Association's claim for Jackson's "violation" of the covenants involves two aspects: (i) the publications and (ii) her other criticisms of how the directors run the Association. See, e.g., Tr., Vol. 1, p. 70, l. 8, to p. 72, l. 2.

The 1977 covenants -- the only enforceable covenants in Jackson's view-- do not allow attorneys' fees to the Association. The operative words of Paragraph 15 of the 1977 covenants state, "If a judicial action is necessary to prohibit a covenant violation and a violation is established, the violator(s) shall pay all costs of the enforcement proceeding, including attorneys' fees." The Association has never identified a specific covenant allegedly violated by Jackson. Even under the 2003 amendment (void in Jackson's belief), attorneys' fees are not recoverable. Article VIII states, "If a judicial action is necessary to prohibit or cure a covenant violation and a violation is established, the violator(s) shall pay all costs of the enforcement proceeding, including attorneys' fees." No "covenant violation" was alleged, much less proved.

The trial court erred in awarding the Association its attorneys' fees in "defending the Plaintiff's complaint."

The trial court also awarded the Association its attorneys' fees "in seeking an injunction both under the terms of the covenants (to assure quiet enjoyment) as well as the provisions of CCIOA which permit the award of attorneys' fees in covenant enforcement actions" (emphasis supplied). Again, the Association did not assert, much less prove, a covenant violation by Jackson. The "quiet enjoyment" phrase mentioned by the trial court in its order is found in Paragraph 1 of the 1977 covenants, the pertinent language of which reads "Owners of property in the Ranch shall have the right of use and quiet enjoyment of their property as a working mountain ranch" (emphasis supplied). First, this sentence, if it is even a "covenant," it is a personal covenant. Cloud v. Association of Owners, Satellite Apartment Building, Inc, 857 P.2d 435 (Colo. App., 1992). Second, there is no evidence that Jackson disrupted the "quiet enjoyment" in the use of anyone's property.

No owner, as an owner, even testified (except Jackson and Mr. Donovan, Tr., Vol. 4, pp. 106-128). There was some testimony by the current and past directors that the directors, as directors, were displeased by what Jackson was doing (primarily her publications), but no owner gave one word of testimony on anything. Nor did the owner of the cattle who leases the ranch for grazing purposes testify. There is no evidence, none, by anybody, that Jackson "interfered" into the "quiet enjoyment" of any owner's use or occupancy of that owner's parcel or with the lessee of BLM in the running of his cattle on it. An award of attorneys fees "to assure quiet enjoyment" is beyond the authority of the court and is void. Nichols v. DeStefano, 70 P.3d 505, 507 (Colo. App., 2003).

In the order resulting from the attorneys' fees hearing that was held February 5, 2008, (Vol. 4, pp. 707-709), the trial court, without opportunity for Jackson to comment, belatedly cited CCIOA Sections 302(1)(k) and 123(b) [sic, 123(1)(b)] as justification for allowing attorneys' fees. Both sections say essentially the same thing. Both are very broad and unlimited provisions allowing an association to go after an owner for attorneys' fees whenever that owner does something that the association believes affects its ability "to enforce the powers of the association" (Section 302(1)(k)) or believes an owner failed "to comply with the provision of [any governing document other than the payment of money]" (Section 123(1)(b).

The extremely broad language of both sections effectively muffles dissent among owners because the owners know their association could, under the virtually unlimited "power" of both sections, seek to recover its attorneys' fees in opposing that owner's dissent, no matter how well-founded. These sections need to be confined to true and legitimate "enforcement" powers and "failures" whereby an association, by citation to a specific provision, claims an owner is in violation of that specific provision, and not be used as a wholesale jackhammer to stifle dissent. See CCIOA Section 113 (which imposes an obligation of "good faith" to CCIOA enforcement actions).

Finally, the trial court, correctly, ruled that attorneys' fees were not recoverable for the Association's defamation claim. As the trial court and the Association acknowledged, the defamation and the injunction claims were intertwined, with-- as it turned out at trial -- the injunction dependent on the defamation claim. If the trial court had determined, as set forth above, that Jacksons publications were not libelous, there would have been no basis for an injunction. Also, as the record reflects, about ninety percent of the Association's case against Jackson went to the publications themselves. Yet the court allocated only one-third of the fees sought and approved to the defamation claim (Vol. 4, p. 708) and the remaining two-thirds to the injunction claim. If attorneys' fees are awardable at all for the injunction claim, the most that should have been awarded should have been one-half (if any).

No attorneys' fees at all should have been awarded. Attorneys' fees for "defending the Plaintiff's complaint" find no justification in either CCIOA or the covenants. Attorneys' fees for an injunction "to insure quiet enjoyment" also find no justification in either CCIOA or the covenants.

Part VII of "Did The Trial Court Err?" is Jan's attorney's Opening Brief's concluding remarks in the Colorado Appeals Court.


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CONTRIBUTOR INFORMATION

Jan Jackson

Florissant , CO

Jan Jackson has posted 530 stories and 38 comments since joining on 9/14/2005. Jan Jackson 's average story rating is 4.5.
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