Pinto Lake M.H.People v. County of Santa Cruz CA6 ( 2023 )

Filed 7/28/23 Pinto Lake M.H.P. v. County of Santa Cruz CA6
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
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 This opinion has not been certified for publication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
SIXTH APPELLATE DISTRICT
PINTO LAKE M.H.P. LLC, H050374
(Santa Cruz County
Petitioner and Appellant, Super. Ct. No. 17CV01424)
v.
COUNTY OF SANTA CRUZ et al.,
Respondents.
Mobile home park owner Pinto Lake MHP LLC (Pinto Lake) appeals an award of
attorney fees to the mobile home park’s homeowners’ association, which Pinto Lake
attempted unsuccessfully to bring into this litigation in lieu of the individual mobile home
park residents. (The residents could not be made parties due to the expiration of the
applicable 90-day statute of limitations.) For the reasons we will explain, we find no
error and will affirm the order awarding fees.
I. BACKGROUND
A. THE PARTIES’ PREVIOUS APPEAL
Pinto Lake is the owner of a 177-space mobile home park in Santa Cruz County.
It applied to the county for a special rent adjustment to increase rents by approximately
47 percent. (See Santa Cruz County Code, Ch. 13.32.030.) Assisted by counsel, Pinto
Lake provided notice to the mobile home park residents, whose names were appended to
the petition as required by the governing ordinance (id., § 13.32.060(B)(2)(b)), and the
residents hired their own counsel. At an administrative hearing on the application, both
Pinto Lake and the residents called expert witnesses to address whether a rent increase
was necessary to provide Pinto Lake with a just and reasonable return on its investment
as contemplated in the County Code. The hearing officer ultimately denied the proposed
increase in a written decision.
Under former Santa Cruz County Code section 13.32.060(B)(16) (providing for
judicial review of the hearing officer’s decision under Code of Civil Procedure
sections 1094.5 and 1094.6), Pinto Lake filed a combined petition for administrative
mandamus and complaint for declarative and injunctive relief naming the county and the
hearing officer as respondents. The hearing officer filed a notice of non-interest in the
proceedings, and the county demurred to the petition on grounds that Pinto Lake failed to
join the mobile home park residents as parties. The trial court sustained the demurrer
(with leave to amend) for failing to join the residents as parties. Instead of amending its
petition/complaint, Pinto Lake elected to stand on the original pleadings. The county
moved to dismiss based on Pinto Lake’s failure to file an amended pleading, a judgment
of dismissal was entered, and Pinto Lake appealed.
This court found in the previous appeal (Pinto Lake MHP LLC v. County of Santa
Cruz (2020) 56 Cal.App.5th 1006 (Pinto Lake I)) that the trial court did not abuse its
discretion in concluding that the residents were necessary parties under Code of Civil
Procedure section 389, subdivision (a), but remanded the matter to allow the trial court to
reach the question of whether the residents were indispensable parties under Code of
Civil Procedure section 389, subdivision (b) in whose absence the case could not
proceed.
B. PROCEEDINGS ON REMAND
Having conceded in the previous appeal that the 90-day statute of limitations in
Code of Civil Procedure section 1094.6 precluded making the residents parties to the
lawsuit, on remand Pinto Lake amended its pleading to name the Pinto Lake Mobile
Home Park Homeowners’ Association (the Association) as a defendant. The Association
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demurred, arguing that the same statute of limitations precluded making it a party to the
lawsuit. The trial court requested additional briefing from Pinto Lake and the
Association on whether the residents were indispensable parties, and on the related issue
of whether the Association could “legally be considered a substitute or stand-in for the
residents.” The county joined in the Association’s briefing.
After further hearing on the county’s original demurrer, the trial court determined
that the residents were indispensable parties without whom the matter could not proceed
and dismissed the case. It found that Pinto Lake’s amendment purporting to add the
Association as a defendant was procedurally improper because the amendment exceeded
the scope of this court’s limited remand, and it therefore struck the amendment as void.
The Association then moved for attorney fees under both the Mobilehome Residency
Law (Civ. Code, § 798.85) and the private attorney general statute (Code Civ. Proc.,
§ 1021.5). Pinto Lake argued in opposition that because the Association had never
actually become a party to the lawsuit, it was not entitled to attorney fees under either
statute. The trial court granted the Association’s motion and ordered Pinto Lake to pay
$38,733.75 in attorney fees (representing the Association’s proposed lodestar amount
without a requested multiplier).
II. DISCUSSION
Pinto Lake challenges the award of attorney fees to the Association under both the
Mobilehome Residency Law and the private attorney general statute. The Association
argues that the trial court properly exercised its discretion in awarding attorney fees under
the private attorney general statute, but does not address its entitlement to attorney fees
under the Mobilehome Residency Law. In light of the Association’s position and
because we conclude the award of attorney fees was proper under the private attorney
general statute, we need not determine whether the Association qualified for attorney fees
under the Mobilehome Residency Law.
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A. THE PRIVATE ATTORNEY GENERAL STATUTE (CODE CIV. PROC., § 1021.5)
Under California’s private attorney general statute, “a court may award attorneys’
fees to a successful party against one or more opposing parties in any action which has
resulted in the enforcement of an important right affecting the public interest if: (a) a
significant benefit, whether pecuniary or nonpecuniary, has been conferred on the general
public or a large class of persons, (b) the necessity and financial burden of private
enforcement, or of enforcement by one public entity against another public entity, are
such as to make the award appropriate, and (c) such fees should not in the interest of
justice be paid out of the recovery, if any.” (Code Civ. Proc., § 1021.5.) Pinto Lake
asserts that an award was impermissible in this case because the Association was not a
successful party, its participation in the litigation did not enforce an important right
affecting the public interest or confer a significant benefit on any large class of persons,
and fees were not warranted by the necessity and financial burden of private enforcement.
1. Standard of Review
The parties disagree about the standard of review that applies to the award of
attorney fees under the private attorney general statute. Pinto Lake contends—without
analysis—that our review is de novo as to all issues presented; the Association urges the
proper standard is abuse of discretion (while acknowledging that a pure question of
statutory construction would call for de novo review). We observe that an award of
attorney fees is generally reviewed for abuse of discretion, although we agree that de
novo review is appropriate if a question of law requiring statutory construction is
presented. (Conservatorship of Whitley (2010) 50 Cal.4th 1206, 1213 (Whitley).) In
addition, as to mixed questions of law and fact, we apply a de novo standard where the
material facts are undisputed, and a deferential abuse of discretion standard where factual
disputes predominate. (Connerly v. State Personnel Bd. (2006) 37 Cal.4th 1169, 1175–
1176.) Given the different standards that govern the component questions of the attorney
fees decision, we will note the standard we are applying in our discussion of each.
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2. Whether the Association Was a Successful Party
Because the amendment naming the Association as a defendant was deemed void
by the trial court, Pinto Lake argues the Association was not a party to the lawsuit at all,
let alone a “successful party” for purposes of the private attorney general statute (Code
Civ. Proc., § 1021.5). In rejecting Pinto Lake’s argument that the Association never
became a party, the trial court relied on a statement in this court’s earlier opinion (Pinto
Lake I, supra, 56 Cal.App.5th at p.1015) noting “that the residents and their association
engaged legal counsel and participated in the special rent adjustment proceeding.” But
that appeal addressed only whether under Code of Civil Procedure section 389,
subdivision (a) the individual residents must be added as parties to the lawsuit. Nothing
in the quoted language prescribed that the Association should later become a party
eligible for attorney fees under Code of Civil Procedure section 1021.5. We review this
mixed question de novo, as the Association’s involvement in the litigation after being
named as a defendant is undisputed.
Taking “a broad, pragmatic view” of the private attorney general statute and its
“ ‘successful party’ ” requirement (Graham v. DaimlerChrysler Corp. (2004)
34 Cal.4th 553, 565 (Graham)), we see no reason why the Association should be
categorically ineligible for attorney fees. After Pinto Lake named the Association as a
defendant, the Association filed a demurrer as well as the additional briefing requested by
the trial court. Even assuming the Association’s recognition as a party was rendered a
legal nullity when the trial court struck the amendment that named it as a defendant, the
Association nonetheless participated in the litigation “in essentially the same way as a
formally recognized party” and therefore should be treated as such under Code of Civil
Procedure section 1021.5. (Vosburg v. County of Fresno (2020) 54 Cal.App.5th 439,
461.) In Vosburg, an unincorporated association that litigated on behalf of its members
qualified for attorney fees under the private attorney general statute even though the trial
court never ruled on its motion to intervene as a party. Pinto Lake attempts to distinguish
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this case, suggesting that the Association—unlike the association in Vosburg, at pp. 451–
456—did not have standing to act as a representative of its members. But, even if
accurate, that distinction is immaterial because the Association did not attempt to
intervene—it was named as a defendant by Pinto Lake itself. Having chosen to hale the
Association into court, Pinto Lake cannot rely on its own procedural error to foreclose an
award of attorney fees.
We also reject Pinto Lake’s argument that the Association was not “successful”
because no judgment was entered in its favor. A favorable judgment is not a prerequisite
for an award of attorney fees under the private attorney general statute; a favorable
outcome is, but the procedural means by which that outcome is achieved is not
dispositive. (Graham, supra, 34 Cal.4th at pp. 565–566.) Here, upon being named as a
defendant, the Association consistently sought to extricate itself from the proceedings and
to have the lawsuit dismissed in its entirety. And, after requesting additional briefing
from the Association on directly relevant legal issues, the trial court entered an order
resulting in the Association’s desired outcome. Due to the procedural posture of the case,
that order followed a hearing on the county’s demurrer (not the Association’s), but the
Association participated in the hearing as a party and fully achieved its litigation
objectives. That is sufficient to make it a “successful party,” as that term is used in Code
of Civil Procedure section 1021.5.
3. Whether the Association Enforced an Important Right Affecting the
Public Interest
Pinto Lake contends that the Association’s participation in the litigation resulted
only in its removal as a defendant and did not result in the enforcement of an important
right affecting the public interest. The trial court found otherwise, stating that its
dismissal of the lawsuit “potentially impacts all mobile home residents in Santa Cruz
County,” a finding which required it to exercise discretion in assessing the importance of
any right enforced and its effect on the public interest. We therefore review that finding
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for abuse of discretion. (See Woodland Hills Residents Assn., Inc. v. City Council (1979)
23 Cal.3d 917, 938 (Woodland Hills) [in evaluating whether a litigant who “prevails on a
‘technical’ preliminary issue” is entitled to attorney fees, a trial court must use “its
traditional equitable discretion” to “realistically assess the litigation and determine, from
a practical perspective, whether or not the action served to vindicate an important
right”].) We will presume that the trial court acted permissibly unless the record
affirmatively reveals error. (See Maria P. v. Riles (1987) 43 Cal.3d 1281, 1295 [“It is the
burden of the party challenging the fee award on appeal to provide an adequate record to
assess error”].) We note in this regard that Pinto Lake has elected to pursue this appeal
without a transcript of the relevant oral proceedings.
As we have discussed, the Association succeeded not only in removing itself from
the action but also in having the lawsuit dismissed due to the residents’ absence. The
trial court found that the residents were indispensable parties without whom the matter
could not proceed, after requesting and considering briefing from both Pinto Lake and the
Association on that very issue. Under the circumstances, it could reasonably have
determined that the Association enforced an important right affecting “all mobile home
residents in Santa Cruz County” by preventing Pinto Lake from continuing to pursue a
special rent adjustment without the residents’ involvement. The right of mobile home
park residents to participate in special rent adjustment proceedings is set forth in the
Santa Cruz County Code, and we see no abuse of discretion in finding that the
Association’s enforcement of that right satisfied the threshold requirement of the private
attorney general statute.
4. Whether the Association Conferred a Significant Benefit to the
General Public or a Large Class of Persons
In conjunction with its argument that the Association did not enforce an important
right affecting the public interest, Pinto Lake asserts that the litigation did not confer a
significant benefit on the general public or a large class of persons as required under
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Code of Civil Procedure section 1021.5. In finding that it did, the trial court identified
the “significant benefit” as a “determination whether rent adjustments are valid or not,”
and described the “large class of persons” as “mobile homeowners throughout [Santa
Cruz] County.” We review the trial court’s finding for abuse of discretion (Graham,
supra, 34 Cal.4th at p. 578), and will again presume correctness absent an affirmative
showing of error in the record.
Pinto Lake correctly observes that the dismissal of its lawsuit did not invalidate
any actual rent increase nor special rent adjustments generally, nor did it prevent Pinto
Lake from applying again for a special rent adjustment. But the dismissal did confirm
that a special rent adjustment obtained without input from mobile home park residents
would be invalid, and that a judgment issued “without the [r]esidents’ presence would not
be adequate.” The trial court could reasonably conclude that the litigation conferred a
significant benefit on residents of other mobile home parks in Santa Cruz County to
whom the same principles would apply (cf. Bowman v. City of Berkeley (2005)
131 Cal.App.4th 173, 180–181), and the record gives us no reason to doubt that those
residents comprise a sufficiently “large class of persons” under Code of Civil Procedure
section 1021.5.
5. Whether Private Enforcement was Necessary and a Financial Burden
The final argument in Pinto Lake’s challenge to the award of attorney fees under
the private attorney general statute is that the Association’s participation did not meet the
“necessity and financial burden” requirement of Code of Civil Procedure section 1021.5.
That requirement has two parts: private enforcement must be necessary, and the financial
burden of private enforcement must warrant an award of attorney fees. (Whitley, supra,
50 Cal.4th at p. 1214; Lyons v. Chinese Hospital Assn. (2006) 136 Cal.App.4th 1331,
1348 (Lyons).) The first part was met here because the Association was named as a
defendant and—as this court observed in its earlier opinion (Pinto Lake I, supra,
56 Cal.App.5th at pp. 1015–1017)—the county did not share its interest in preserving the
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outcome of the administrative proceeding. But Pinto Lake contends that the financial
burden on the Association was not sufficient to warrant subsidizing its attorneys. The
trial court found that attorney fees were warranted, based in part on the limited financial
means of many mobile home park residents, and as we have explained, we review such a
finding for abuse of discretion.
Citing California Licensed Foresters Assn. v. State Bd. of Forestry (1994)
30 Cal.App.4th 562, Pinto Lake asserts that the financial status of the Association and its
members is irrelevant, and the Association’s “significant pecuniary interest” in the
litigation precludes it from obtaining attorney fees under the private attorney general
statute. Indeed, the Association’s pecuniary interest in the litigation is relevant to an
assessment of its relative financial burden, but the mere existence of such an interest is
not disqualifying. (Lyons, supra, 136 Cal.App.4th at p. 1352.) A financially interested
litigant who bears a burden disproportionate to their pecuniary interest may be awarded
attorney fees notwithstanding that interest. (Whitley, supra, 50 Cal.4th at p. 1215;
Woodland Hills, supra, 23 Cal.3d at p. 941.) A litigant’s financial condition may be
relevant to that determination as well. (City of Oakland v. Oakland Police & Fire
Retirement System (2018) 29 Cal.App.5th 688, 704–708.)
The trial court did not abuse its discretion in determining that the financial burden
requirement was met. The trial court reasonably considered the limited means of the
Association and its members, and as a defendant for whom the best possible outcome was
dismissal of the lawsuit, the Association had no prospect of a financial recovery that
could be used to compensate its attorneys. (Cf. Heron Bay Homeowners Assn. v. City of
San Leandro (2018) 19 Cal.App.5th 376, 388–389 [where plaintiff sought only to avoid a
financial loss, trial court properly considered that as factor supporting award of attorney
fees].) The record therefore supports the conclusion that the Association bore a financial
burden disproportionate to its financial stake in the litigation. Further, any financial
benefit relating to the previous rent adjustment proposal is potentially temporary, as Pinto
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Lake remains free to renew its application for a special rent adjustment following
dismissal of this lawsuit. Yet the Association pursued dismissal, thereby enforcing the
procedural right of mobile home park residents in Santa Cruz County to participate in
rent adjustment proceedings. (See Baggett v. Gates (1982) 32 Cal.3d 128, 143 [parties
who “have secured the enforcement of basic procedural rights” that “may well not result
in any pecuniary benefit” have met the financial burden requirement].) Seeing no
indication in the record that the trial court acted improperly, we presume correctness and
find no abuse of discretion.
B. THE MOBILEHOME RESIDENCY LAW (CIV. CODE, § 798.85)
Alternatively, Pinto Lake challenges the award of attorney fees to the Association
under the Mobilehome Residency Law. Pinto Lake argues the action did not arise out of
that law, and the Association is not an entity that was the prevailing party in the action.
(Civ. Code, § 798.85.) The Association has not responded to those arguments in its
briefing here. Given our conclusion that attorney fees were proper under the private
attorney general statute, we need not reach the issue of their propriety under the
Mobilehome Residency Law.
III. DISPOSITION
The order awarding attorney fees is affirmed. Costs are awarded to the
Association by operation of California Rules of Court, rule 8.278, subdivision (a)(1).
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____________________________________
Grover, J.
WE CONCUR:
____________________________
Greenwood, P. J.
____________________________
Lie, J.
H050374
Pinto Lake M.H.P. LLC v. County of Santa Cruz et al.