hoa-lien-foreclosure

These are crazy and very frustrating times to be an attorney representing consumers. The reality is, far too often…and regardless of the law or facts, judges bend over backwards and contort themselves into the most bizarre positions in order to grant judgments for plaintiffs.  We see it now in insurance cases, malpractice cases…any case which pits a consumer fighting against any business or other interest.

We recently fought a case that takes this unfortunate tilt to the most extreme…and the final order sets up an excruciatingly bad and unthinkable precedent that just cannot be allowed to stand. The facts are simple and undisputed. A consumer’s homeowner’s association files a lawsuit claiming they were behind a few hundred dollars on their assessment. (The consumer disputed that they were behind and the amount.) But notwithstanding the consumer’s very real and credible defense that they were not in fact behind, upon learning that a lien had been filed….AND BEFORE ANY LAWSUIT WAS IN FACT FILED…the consumer deposited the full amount claimed by the HOA into the HOA’s bank account….the same method for payment they had been directed to use and had used every time before. Now, notwithstanding that the full amount alleged to be owed had been tendered, the HOA filed a lawsuit to foreclosure the consumer…ignoring the fact that they had paid the full amount alleged to be owed…BEFORE THE LAWSUIT WAS EVEN FILED.

Immediately upon learning that a lawsuit had been filed…the consumer advised the HOAs attorneys that the full amount had been paid…and directed the HOA to check with their bank.  The HOA did so, confirmed the money was there…and rather than just dismiss the action…they decided to fight and fight and fight….an action and a fight that went on for years.  At some point in time…years after fighting…the HOA finally does the right thing…and dismisses the lawsuit. Now, under solidly established principals of law that are consistent across all of the country and across all areas of law, the HOA would be obligated to pay the consumer’s prevailing party attorney fees. But in what can only be one of the most bizarre and unsupported decisions I can ever think of…the HOA made the claim that

THEY WERE ENTITLED TO ATTORNEYS’ FEES! AND THE JUDGE ENTERED AN ORDER FINDING SO!

Think about this in the context of any other litigation. A party can, out of the blue, sue anyone they want…then, when they’re caught filing a frivolous or unsupported case, dismiss it and then sue the consumer for the pleasure of having been subjected to a lawsuit. It’s just utterly unbelievable that a judgment like this could be entered….and even more unbelievable that an opinion like this would be allowed to stand appellate scrutiny.  As we say, this appeal follows. First, here is a

SUMMARY OF THE ARGUMENT

Initially, the trial court erred when it denied the Homeowners’ motion for attorney’s fees.  First, the HOA waived any right it may have had to look beyond the voluntary dismissal because its motion in limine expressly disclaimed any interest in the merits of the action.  But even if the trial court could have looked beyond the dismissal, it still should have granted the motion because the Homeowners were the prevailing party to the lawsuit.

The trial court also committed an independent error when it granted the HOA’s “cross-motion” for fees.  There is no authority standing for the proposition that a plaintiff may take a voluntary dismissal and then turn around and seek fees.  Thus, the best the HOA could have hoped for was a finding that no one was the prevailing party to this lawsuit and therefore no one was entitled to fees.  And so in awarding the HOA fees in a case it voluntarily dismissed, the trial court trampled all over the Homeowners’ due process rights.

Therefore, the Court should reverse the orders denying the Homeowners’ motion for attorney’s fees and granting the HOA’s motion for fees with instructions that on remand, the trial court grant the Homeowners’ fee motion.

And next, click below for the full brief:

 

 

 

 

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