This case involved a dispute between a homeowners association (“Association”) and a homeowner (“Owner”). The dispute was over the unilateral assessment of a charge against Owner for attorney fees and costs that had been incurred by Association in seeking and obtaining an injunction against Owner. Association sought an injunction in order to prevent her continued disruption of Association’s meetings and harassment of certain board members.
Chronology of Events that Occurred
Various instances of disruption at meetings and harassment of directors prompted Association to retain a private off-duty police officer as a security guard at board meetings. As a result, Association sought and obtained an ex parte injunction against Owner that under an Arizona statute that prevents workplace harassment. Association did not ask the justice court that issued the injunction to award it attorney’s fees, so none were awarded by the court. However, Association subsequently assessed Owner the sum of $3,887.28 for the fees incurred in obtaining the injunction. Association made the assessment based on provisions contained in Association’s governing documents that requires owners to pay attorneys’ fees that are incurred by Association in connection with an action to enforce compliance with or specific performance of the terms contained in Association’s Declaration.
According to Association, Owner’s conduct violated certain provisions of the Declaration and Association had to take legal action to enforce the Declaration in which legal fees and costs were incurred. Since this action resulted in the imposition of an injunction, it was entitled to assess the fees and costs against Owner. In disputing Association’s right to assess the fees and costs against her, Owner filed an action against Association seeking damages in the amount of the assessment, plus the costs and fees that she was incurring in challenging the assessment.
The Trial Court Ruling
The trial court ruled that the ex parte injunction obtained by Association was unconstitutionally vague and overbroad. Thus, Association could not have been the “prevailing party” in the action seeking the injunction because it was an uncontested proceeding where no notice was provided to Owner and Owner did not participate. Accordingly, the trial court found that the assessment of the fees and costs incurred by Association in seeking the injunction was improper and Owner was entitled to recover the $3,887.28. Association then appealed the trial court’s judgment in favor of Owner.
Association Appealed the Trial Courts Ruling
On appeal, Association contended that, although it did not seek attorney fees in the proceeding for the injunction, it was still entitled to impose a charge on Owner for the fees and legal expenses that were incurred in connection with the proceeding because Association’s Declaration authorized the unilateral imposition of the charges and no judicial approval was necessary.
The Appellate Court Sides with Owner
The appellate court ruled that Association waived its claim for attorney fees by not requesting an award of the fees from the justice court that had originally issued the injunction in favor of Association. The appellate court stated that, even though Association’s Declaration contained a contractual entitlement to attorney fees, that did not give Association the right to unilaterally charge Owner for attorney’s fees and costs that it incurred without first receiving an award for same from the court. Accordingly, the appellate court ruled that the attorney’s fees and costs assessed against Owner were improper and the trial court’s decision was affirmed.
Arizona Appellate Court decision (April 3, 2018).
See case decision: Bocchino_v._Fountain_Shadows_Homeowners_Ass’n_(Ariz._App._2018)1