Court Opinion

ID: 2822127
Source: CourtListenerOpinion
Date Created: 2015-07-30 21:03:44.57918+00
Date Added: 2024-06-11T12:24:27.933876
License: Public Domain

Filed 7/30/15 Fleur Du Lac Estates Assn. v. Mansouri CA3
                                           NOT TO BE PUBLISHED
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.

              IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
                                      THIRD APPELLATE DISTRICT
                                                        (Placer)
                                                            ----

FLEUR DU LAC ESTATES ASSOCIATION,                                                            C077390

                   Plaintiff and Respondent,                                   (Super. Ct. No. TCV0001479)

         v.

ZARI MANSOURI,

                   Defendant and Appellant.

         This case arises out of a dispute between a homeowners’ association--plaintiff
Fleur du Lac Estates Association (the Association)--and one of its member homeowners--
defendant Zari Mansouri--regarding certain improvements Mansouri made to her
property. Although arbitration of the underlying dispute has not yet been completed, the
Association successfully defended an interlocutory appeal that Mansouri took from a trial
court ruling denying her petition to vacate an interim arbitration award. The trial court
subsequently awarded the Association more than $50,000 in attorney fees against
Mansouri for prevailing in that appeal.

                                                             1
        On appeal from the fee award, Mansouri contends the trial court erred in awarding
the Association its fees on appeal because the fee motion was premature. We agree. As
we will explain, for purposes of determining the entitlement to a fee award here, there
can be only one prevailing party in the dispute over the improvements to Mansouri’s
property, and the determination of which party that is (if either) must await the final
resolution of the dispute. Even though the Association was the prevailing party on
Mansouri’s appeal relating to the interim arbitration award, that does not mean the
Association will be the prevailing party in the dispute when it is finally over. Because
the trial court erred in granting the Association’s motion for fees before the entire dispute
was finally resolved, we reverse.
                   FACTUAL AND PROCEDURAL BACKGROUND
        We take the initial facts from one of our two previous published opinions in this
case:
        “Mansouri owns a condominium unit within Fleur du Lac Estates at Lake Tahoe.
The Association is the homeowners association for the development, and Mansouri is a
member of the Association.
        “In December 2006, Mansouri submitted an application to the Association’s
architectural control committee to remodel various parts of her condominium, including
the patio. In July 2008, after the remodeling was complete, the Association notified
Mansouri that the patio improvements did not conform to the plans the committee had
approved. The Association requested that Mansouri remove the nonconforming patio
improvements. She refused.
        “In September 2008, the Association requested that Mansouri agree to submit the
dispute to binding arbitration before a single arbitrator selected by the Association and
threatened court action if she did not do so. When Mansouri refused, the Association
commenced this action by filing a petition to compel arbitration under an arbitration
provision contained in the second restated declaration of covenants, conditions and

                                              2
restrictions for the Association (CC & R’s). That provision provides that any dispute
between the Association and an owner about the meaning or effect of any part of the
CC & R’s will be settled by binding arbitration before a three-member panel of
arbitrators, with one arbitrator selected by the Association, one selected by the owner,
and the third selected by the other two.
       “The trial court granted the Association’s petition to compel arbitration and
awarded the Association attorney fees. [Citation.] Mansouri sought relief in this court by
means of a petition for a writ of mandate. [Citation.] ‘We granted an alternative writ . . .
to consider (1) whether the arbitration provision in the CC & R’s [wa]s unenforceable
and unconscionable; (2) if the arbitration provision [wa]s valid, whether this dispute f[ell]
outside of the scope of the arbitration provision; and (3) whether the Association
complied with the applicable statutory requirements for a petition to compel arbitration.
We conclude[d] the arbitration provision [wa]s enforceable, [wa]s not unconscionable,
and [wa]s applicable. However, in the published portion of [our] opinion, we [also]
conclude[d] a party seeking to compel arbitration under [Code of Civil Procedure]
section 1281.2 . . . must establish it demanded arbitration under the parties’ arbitration
agreement and that the other party refused to arbitrate under the agreement before it is
entitled to an order granting a petition to compel such arbitration. As the Association . . .
failed to show it requested Mansouri to arbitrate under the arbitration provision of the
CC & R’s and that Mansouri refused to arbitrate under such provision, [we concluded the
Association’s] petition to compel such arbitration should have been denied.
[Accordingly, w]e . . . issue[d] a writ of mandate requiring the trial court to vacate its
order compelling arbitration and awarding attorney fees and to enter a new order denying

                                              3
the Association’s petition.’ [Citation.] We also awarded Mansouri her costs on appeal.
[Citation.][1]
       “Following our decision in [Mansouri I], in May 2010 Mansouri filed in the trial
court a memorandum of costs on appeal seeking $1,522.44 in appellate costs, a
memorandum of costs seeking $350 in trial court costs, and a motion for $209,075.14 in
attorney fees under two attorney fees provisions in the CC & R’s. Mansouri sought the
award of attorney fees on the theory that she was ‘the prevailing party in this suit.’
       “The Association moved to strike Mansouri’s costs memoranda and opposed her
fee motion. Among other things, the Association argued that Mansouri’s request for her
fees and costs was untimely and she was not the prevailing party because this court’s
ruling ‘guarantee[d] resolution [of the dispute] via three-panel arbitration,’ which the
Association claimed it ‘had sought since the commencement of these proceedings.’
       “In January 2011, the trial court agreed with the Association that Mansouri was
too late in filing her costs memoranda and her fee motion and on that basis granted the
Association’s motion to strike the memoranda and denied Mansouri’s motion for fees.
Mansouri did not appeal from that order; instead, she filed a motion for reconsideration
under [Code of Civil Procedure] section 1008 or, in the alternative, for relief under [Code
of Civil Procedure] section 473(b) based on excusable mistake.
       “Meanwhile, also in January 2011, the Association filed a second petition to
compel arbitration. This time the Association demonstrated that it had demanded
arbitration under the arbitration provision of the CC & R’s. Mansouri did not oppose the
petition, and in April 2011 the court granted the petition and ordered the matter to
arbitration.

1     The opinion resulting from the writ proceeding was Mansouri v. Superior Court
(2010) 181 Cal. App. 4th 633 (Mansouri I).

                                              4
       “In May 2011, in ruling on Mansouri’s motion for reconsideration of the denial of
her fee motion, the trial court determined that Mansouri had presented new facts not
available at the time of the hearing on the motion. Nevertheless, the court concluded that
the new evidence did not change the result and denied the motion for reconsideration.
The court also denied Mansouri’s request for relief under [Code of Civil Procedure]
section 473(b) on the ground that the mistake she had shown was not excusable.
       “Mansouri initially sought review of the May 2011 order denying her motion for
reconsideration and for relief under [Code of Civil Procedure] section 473(b) by means of
a writ petition in this court. In her memorandum of points and authorities in support of
that petition, Mansouri argued that she lacked an adequate remedy at law because it was
‘unclear’ whether the May 2011 order was appealable. In a footnote, she asserted that the
order was ‘[a]rguably . . . appealable as a post-judgment order, assuming [the order
denying the Association’s first petition to compel arbitration] qualifies as a judgment.’
She further argued, however, that ‘[t]hat seems unlikely . . . given that the Association
has filed . . . under the same superior court action number a new petition to compel
arbitration. This means that presumably there will be additional proceedings, including
possibly a true final judgment (perhaps confirming an arbitration award).’
       “We denied Mansouri’s writ petition on the ground that Mansouri had a remedy
by appeal. The next day, Mansouri filed a timely notice of appeal from the May 2011
order.” (Fleur du Lac Estates Assn. v. Mansouri (2012) 205 Cal. App. 4th 249, 252-254,
fns. omitted (Mansouri II).)
       In April 2012, in Mansouri II, we concluded that the May 2011 order was not
appealable as a postjudgment order because there was no judgment, and consequently we
dismissed her appeal. (Mansouri II, supra, 205 Cal.App.4th at pp. 251, 257, 259.) In
doing so, we never reached the question of whether the trial court had erred in denying
Mansouri’s motion for reconsideration or relief based on excusable neglect relating to her
fee motion and costs memorandum.

                                             5
       In October 2012, the Association prevailed on an unopposed motion for summary
judgment in the arbitration proceeding. At that time, Mansouri was representing herself,
and the arbitrators had denied her repeated requests for a continuance. The arbitrators
issued an interim award compelling Mansouri to “resubmit a revised set of as-built plans”
to the Association and dictating what was to happen if she failed to do so or if the
Association refused to approve the plans. The arbitrators expressly “retain[ed]
jurisdiction of this dispute until it is finally resolved” and deferred all claims for attorney
fees and costs.
       In January 2013, Mansouri filed a petition with the trial court in this proceeding to
vacate the interim arbitration award. The trial court denied that petition in March 2013.
Later that month, Mansouri filed for chapter 11 bankruptcy.
       In May 2013, Mansouri appealed to this court the trial court’s denial of her
petition to vacate the interim arbitration award (case No. C073765). That appeal was
stayed for the bankruptcy proceedings until September 2013, when the Association
notified this court that the bankruptcy court had lifted the stay to allow the completion of
the arbitration proceedings. Thereafter, Mansouri failed to designate the record on
appeal, and this court dismissed the appeal in November 2013. Mansouri obtained
permission from the bankruptcy court to retain counsel to attempt to reinstate the appeal,
but by the time her counsel sought that relief this court had lost jurisdiction. The
California Supreme Court denied review, and the remittitur issued in February 2014.
       In April 2014, the Association filed a motion for $50,109.75 in attorney fees
“incurred in connection with challenging and defending against . . . Mansouri’s appeal
and court challenges . . . against the arbitration panel’s October 2012 decision.” The
Association claimed it was entitled to a fee award as “the prevailing party” under the
CC & R’s. Mansouri opposed the motion, contending that “[t]he extent to which either
side has actually ‘prevailed,’ and to what degree, has yet to be determined. . . . [T]rial

                                               6
courts make a ‘prevailing party’ determination once, based on a complete record, and do
not award fees for piecemeal victories.”
       In July 2014, the trial court granted the Association’s motion, concluding that
“[b]ecause the requested fees are all directly related to [Mansouri’s] last, unsuccessful
appeal, a fees award is appropriate even though some issues remain outstanding in the
arbitration.” Mansouri timely appealed from the resulting formal order.
                                      DISCUSSION
       Mansouri contends the trial court erred in awarding attorney fees to the
Association because the Association’s fee motion was premature. We agree.
                                              I
               Law Of The Case Did Not Make The Fee Motion Premature
       Mansouri first contends that under the doctrine of the law of the case,2 the
Association’s fee motion was premature because we held in Mansouri II “that motions
for an ‘interim’ award of attorney’s fees . . . are improper.” On this point, Mansouri is
wrong. All we decided in Mansouri II was that the order from which Mansouri sought to
appeal was not appealable. (Mansouri II, supra, 205 Cal.App.4th at pp. 251, 257.) We
never reached the merits of Mansouri’s fee motion and expressed no opinion as to the
timeliness of that motion. Indeed, we specifically noted that “on appeal from the final
judgment in this proceeding, Mansouri should be able to challenge the denial of her
attorney fees motion and the granting of the Association’s motion to strike her costs
memoranda.” (Id. at p. 258.) We would have had no occasion to note this if, as

2      “The doctrine of the law of the case is this: That where, upon an appeal, the
[S]upreme [C]ourt [or Court of Appeal], in deciding the appeal, states in its opinion a
principle or rule of law necessary to the decision, that principle or rule becomes the law
of the case and must be adhered to throughout its subsequent progress, both in the lower
court and upon subsequent appeal, . . . and this although in its subsequent consideration
this court may be clearly of the opinion that the former decision is erroneous in that
particular.” (Tally v. Ganahl (1907) 151 Cal. 418, 421.)

                                             7
Mansouri now contends, we had already decided that a motion for an interim award of
fees was improper. Accordingly, Mansouri’s reliance on the law of the case doctrine is
misplaced.
                                              II
                       The Fee Motion Was Premature Nonetheless
       While we did not decide the propriety of a motion for an interim award of attorney
fees in Mansouri II, that issue is now squarely before us. As we will explain, we agree
with Mansouri that such a motion is improper.
       In its fee motion, the Association sought a fee award pursuant to Civil Code
sections 1717 and 5975, subdivision (c), and Code of Civil Procedure sections 1021,
1032, and 1033.5. The Association claimed that because “the CC & Rs controlling the
underlying dispute” contain “at least two provisions [that] expressly require the award of
attorneys’ fees to the party prevailing in an action to enforce the CC & Rs,” the
Association was entitled to a fee award for prevailing on Mansouri’s appeal in case
No. C073765. The Association also contended it was entitled to a fee award under the
fee statute in the Davis-Stirling Common Interest Development Act. (Civ. Code, § 5975,
subd. (c).) The trial court agreed with both arguments. We do not agree with either.
       We begin with the fee provisions in the CC & R’s. Section 9.8(a) of the CC & R’s
provides that “[i]f any legal proceeding is initiated to enforce any of the provisions
hereof,[3] the prevailing party shall be entitled to recover reasonable attorneys’ fees in
addition to the costs of such proceedings.” Section 16.9 of the CC & R’s provides that
“[i]f any Owner or any assignee of any Owner hereunder shall bring an action in any

3      Because the Association provided us with only excerpts from the CC & R’s, it is
not clear whether “the provisions” referred to here are all of the CC & R’s or only those
related to matters that are required to be submitted to the Architectural Control
Committee. For our purposes, however, it makes no difference.

                                              8
court or initiate arbitration proceedings to resolve any controversy or claim arising out
[of] or relating to this Declaration . . . , it is hereby mutually agreed that the prevailing
party shall be entitled to reasonable attorneys fees and all costs and expenses in
connection with said action, which sums shall be included in any judgment or decree
entered in such action in favor of the prevailing party.”
       The proper interpretation of these fee provisions is informed by Civil Code
section 1717, which provides in relevant part as follows:
       “(a) In any action on a contract, where the contract specifically provides that
attorney’s fees and costs, which are incurred to enforce that contract, shall be awarded
either to one of the parties or to the prevailing party, then the party who is determined to
be the party prevailing on the contract, whether he or she is the party specified in the
contract or not, shall be entitled to reasonable attorney’s fees in addition to other costs.
       “[¶] . . . [¶]
       “(b) (1) The court, upon notice and motion by a party, shall determine who is the
party prevailing on the contract for purposes of this section, whether or not the suit
proceeds to final judgment. Except as provided in paragraph (2), the party prevailing on
the contract shall be the party who recovered a greater relief in the action on the contract.
The court may also determine that there is no party prevailing on the contract for
purposes of this section.”4
       Civil Code section 1717 makes clear that where a party seeks an award of attorney
fees in an action “on a contract” based on a prevailing party fee provision within that
contract, the right to such an award depends on whether the court determines that the
party seeking the fee award “recovered a greater relief in the action on the contract” and

4      Civil Code section 1717, subdivision (b)(2) provides that “[w]here an action has
been voluntarily dismissed or dismissed pursuant to a settlement of the case, there shall
be no prevailing party for purposes of this section.”

                                               9
was thus “the party prevailing on the contract.” That determination cannot be made with
respect to an interlocutory appeal like the one for which the Association sought a fee
award here. Under Civil Code section 1717, “[t]he prevailing party determination is to be
made only upon final resolution of the contract claims and only by ‘a comparison of the
extent to which each party ha[s] succeeded and failed to succeed in its contentions.’ ”
(Hsu v. Abbara (1995) 9 Cal. 4th 863, 876.) “ ‘[I]t is well settled a party who prevails on
appeal is not entitled under a [Civil Code] section 1717 fee provision to the fees he incurs
on appeal where the appellate decision does not decide who wins the lawsuit but instead
contemplates further proceedings in the trial court.’ ” (Mustachio v. Great Western Bank
(1996) 48 Cal. App. 4th 1145, 1149-1150, quoting Presley of Southern California v.
Whelan (1983) 146 Cal. App. 3d 959, 961-962.) “An attorney fee award under a provision
such as the one involved here must wait until the lawsuit is completely and finally
decided [citation].” (Presley of Southern California, at p. 961.)
       Nothing in the fee statute contained in the Davis-Stirling Common Interest
Development Act leads to a different result. That statute provides that “[i]n an action to
enforce the governing documents [of a common interest development or association], the
prevailing party shall be awarded reasonable attorney’s fees and costs.” (Civ. Code,
§ 5975, subd. (c).) Similar to Civil Code section 1717, this statute authorizes a fee award
to “the prevailing party” “[i]n an action to enforce the governing documents” of a
common interest development or association. The determination of which party is the
prevailing party in such an action can only be made once the action is complete and
finally decided. The present action is neither.
       The same result flows from the costs statutes on which the Association relied in its
fee motion (Code Civ. Proc., §§ 1021, 1032, 1033.5). Much like the Association here,
the plaintiff in Presley of Southern California contended that an award of contractual
attorney fees for a successful appeal prior to the final resolution of the case was “proper
because [the plaintiff was] entitled to its costs on appeal and the fee provision in the

                                             10
contract simply add[ed] attorney fees as an element of costs.” (Presley of Southern
California v. Whelan, supra, 146 Cal.App.3d at p. 962) The appellate court rejected that
argument as follows: “The provisions allowing costs on appeal (Code Civ. Proc., § 1034
and Cal. Rules of Court, rule 26 [now rule 8.278]) . . . are entirely separate from the
contractual provision for fees and do not depend on the party winning the appeal being
the ultimate prevailing party. [The plaintiff’s] contention is inconsistent with the well
settled rule excluding attorney fees from the costs a party winning an appeal may recover
under section 1034 [citations].”5 (Presley of Southern California, at p. 962, italics
added.)
       In other words, a determination by an appellate court that a party is entitled to
recover its costs on appeal because that party is the prevailing party in the appeal
(see Cal. Rules of Court, rule 8.278) is completely separate from, and does not
necessarily have any bearing on, the determination of whether that party is entitled to an
award of attorney fees under a contractual fee provision as the prevailing party in the
action on that contract. Civil Code section 1717 “ties the fee entitlement not to a costs
award, but to a determination of which party ‘recovered a greater relief in the action on
the contract.’ ” (Snyder v. Marcus & Millichap (1996) 46 Cal. App. 4th 1099, 1104.)
Accordingly, the award of costs on appeal to the Association as the prevailing party on
appeal in case No. C073765 did not entitle the Association to recover its attorney fees for
that appeal. Any right the Association may have to recover its attorney fees for the
appeal in case No. C073765 depends on whether the Association ultimately is determined
to be the prevailing party in this action, once the action is finally resolved. The interim

5      Subdivision (b) of Code of Civil Procedure section 1034 provides that “[t]he
Judicial Council shall establish by rule allowable costs on appeal and the procedure for
claiming those costs.” The allowable costs set forth in rule 8.278(d) of the California
Rules of Court do not include attorney fees.

                                             11
victory the Association won in successfully defending against Mansouri’s interlocutory
appeal in case No. C073765 did not give the Association the right to a separate fee award
for that appeal because “in any given lawsuit there can only be one prevailing party on a
single contract for the purposes of an entitlement to attorney fees.” (Frog Creek
Partners, LLC v. Vance Brown, Inc. (2012) 206 Cal. App. 4th 515, 531.)
       Because the Association’s motion for attorney fees incurred on appeal in case
No. C073765 was premature, the trial court erred in granting that motion.
                                      DISPOSITION
       The order granting the Association’s motion for attorney fees is reversed, and the
matter is remanded to the trial court with instructions to enter a new order denying that
motion. Mansouri shall recover her costs on appeal. (Cal. Rules of Court,
rule 8.278(a)(1).)

                                                        ROBIE                 , Acting P. J.

We concur:

      MAURO                 , J.

      HOCH                  , J.

                                            12