This case involved claims of discrimination made by a group of Orthodox Jewish homeowner members (Owners) against their homeowners association (Association). Owners filed a lawsuit against Association alleging that it took various actions that targeted Owners and other Jewish members of Association that were based on Owners Orthodox Jewish identity in violation of the Federal Fair Housing Act (FHA). After the suit was filed the parties entered into a settlement agreement in the form of a Court-ordered Consent Decree which did not contain any language relative to attorney fees that had been incurred by the parties.

After the Consent Decree was entered by the Court, Owners filed a motion seeking an award of $86,318.90 in attorneys fees that had allegedly been incurred in connection with the case. In the motion, Owners argued that they were entitled to an award of their attorneys fees and costs because the settlement agreement entitled them the status of a prevailing party under the FHA.

In response to the motion, Association contended that Owners were not entitled to recover their fees and costs because the Consent Decree settled all claims, and thereby implicitly waived Owners right to fees, even if they were to be considered the prevailing party.

The Court ruled that: (i) parties can achieve the status of a prevailing party in a settlement if they succeed on any significant issue in litigation which achieves some of the benefits the parties sought in bringing suit; (ii) to establish success, there had to be a court-ordered change in the legal relationship between the parties and, the Consent Decree that had been ordered created that material alteration of the legal relationship between Owners and Association that was necessary to permit an award of attorneys fees; and (iii) when the parties to a settlement agreement dispute whether the prevailing party waived its statutory right to attorneys fees, the burden is on the losing party to show that.

The Court found that the Consent Decree was entirely silent on the right to recover fees and therefore did not extinguish Owners right to an award of fees because it was Associations responsibility to ensure that language constituting a waiver of the right to fees was included in the settlement agreement. The Court also found that Owners had achieved the status of a prevailing party in the Consent Decree and therefore, were entitled to an award of attorneys fees and costs.

Accordingly, after considering the basis for the amount of attorneys fees that were claimed, the Court awarded Owners the $86,318.90 that was requested, plus additional fees that were incurred in connection with the motion for an award of fees. With regard to other costs, the Court found that Owners had not presented evidence of the costs that were incurred so no costs were awarded.

UNPUBLISHED New Jersey U.S .District Court decision (October 30, 2019).

See case decision: Slomovitz_v._Enclave_at_Fairways_Homeowners_Ass’n