Yu v. Broadway Hollywood Homeowners Assn. CA2/1

Filed 3/22/23 Yu v. Broadway Hollywood Homeowners Assn. CA2/1
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for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
SECOND APPELLATE DISTRICT
DIVISION ONE
HELEN YU, as Trustee, etc., B317443
Plaintiff and Appellant, (Los Angeles County
Super. Ct. Nos. 20STCV24864,
v. BC553215)
BROADWAY HOLLYWOOD
HOMEOWNERS ASSOCIATION,
Defendant and Respondent.
APPEAL from a judgment of the Superior Court of Los
Angeles County, Gregory Keosian, Judge. Affirmed.
Miller Barondess, James Goldman for Plaintiff and
Appellant.
The Judge Law Firm, Stephen M. Levine for Defendant and
Respondent.
__________________________________
An owner of a condominium in a common interest
development sued the homeowner’s association for declaratory
relief, alleging the association violated its governing documents
and applicable statutes by charging fees to third parties for valet
parking. After a bench trial, the court found the valet fees
violated no governing document or statute and entered judgment
for the association. We affirm.
BACKGROUND
This is the second lawsuit concerning valet parking at the
Broadway Hollywood, a 10-story historical building on the corner
of Hollywood Boulevard and Vine Street in Hollywood, a noted
tourist destination.
The Broadway Hollywood was not designed to
accommodate on-site parking in such a way as to comply with
modern parking codes. To permit renovation of the building, the
City of Los Angeles (city) granted a variance to parking codes in a
conditional use permit (CUP) issued on July 14, 2005. One
condition for the use permit was that valet service “be made
available to residents and customers of the facility 24 hours a
day, seven days a week.” (Italics added.)
The city required that the developer execute and record a
master covenant that would constitute the developer’s
“acknowledgment and agreement to comply with all the terms
and conditions established” in the site plan review approving the
CUP. The agreement was to “run with the land and be binding
on any subsequent owners.” The developer recorded the master
covenant on August 2, 2005.
The Broadway Hollywood Homeowner’s Association (the
association) adopted this master covenant as one of its “governing
instruments.” Also included in the governing instruments were
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the CUP, a Declaration of Covenants, Conditions, and
Restrictions (CC&Rs), and a residential handbook.
Section 9.5.1(a) of the CC&Rs stated, in pertinent part:
“From time to time the Board may determine that all excess
funds in the Operating Fund be retained by the Association and
used to reduce the following year’s Regular Assessments.”
In 2007, the developer entered into a parking agreement
with a valet service to secure offsite valet parking for a monthly
fee. However, in 2008, the association ended off-site valet
parking for visitors to the building.
By 2013, Helen Yu, the principal of a law firm with an
office in the Broadway Hollywood, and trustee of the YL Trust,
which owns the office, had become dissatisfied with the
association’s parking policy. She sued the association on the
trust’s behalf, seeking a declaration that the association’s
parking program violated the CUP by depriving association
members of the right to make valet parking service available to
their customers. After a bench trial, the court concluded that the
association’s parking program failed to comply with the master
covenant or CUP.
We affirmed the resulting judgment, holding that the CUP
and master covenant obligated the association to provide valet
parking to association members and their customers. (Yu v.
Broadway Hollywood Homeowners Ass’n (Mar. 7, 2019, B280977,
B284599) [nonpub. opn.] (Yu v. Broadway I).) We expressed no
opinion on whether the association could charge a fee for valet
parking.
On June 18, 2019, the association’s board met to discuss, as
reflected in the agenda for the meeting, “proposed changes to
guest parking policy.” On June 26, 2019, the association’s
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members were notified that a valet parking program for
customers would begin on July 1, 2019.
On June 28 and July 5, 2019, the association’s board met in
executive session to discuss, as reflected in the agenda,
“Implementation planning and review of new pilot valet parking
program for compliance [with the Appellate] Court ruling.” The
board voted to impose $20 for a half day of valet parking, $40 for
a full day, and $75 for overnight parking, commencing July 29,
2019.
On July 16, 2019, the association’s board met to discuss, as
reflected in the agenda for the meeting, how “Customer valet
service [was] to be implemented and run according[ to] the
language of the CUP,” and how businesses wishing to have their
customers use valet parking would be required to register with
building management. The minutes reflect that the board
indicated there would be a cost of $20 for parking for four hours,
$40 for eight hours, and an $80 maximum per day.
On July 30, 2019, the association sent a letter to its
members advising them that valet service would be provided for
customers at the rate of $20 per four hours with a daily
maximum of $80.
Yu objected to the new parking policy.
In September 2019, Yu moved the superior court for an
order to show cause (OSC) why the association should not be held
in contempt for violating the judgment in the first lawsuit. The
court issued the OSC but on November 22, 2019 discharged it,
finding that any challenge to the association’s parking policy
would have to proceed by way of a new lawsuit.
On June 5, 2020, the association’s board met in executive
session to discuss, as reflected in the agenda, “parking rates.” It
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decided to lower valet parking rates to $12 for two hours, $20 for
two to four hours, and $30 for more than four hours.
On July 1, 2020, Yu sued the association, seeking
declaratory relief concerning the enforceability of the
association’s decision to impose valet parking fees, an injunction
to prohibit such charges, and restitution of fees already collected.
As of the date of trial, every resident at the Broadway
Hollywood paid a monthly valet parking assessment of
approximately $350 per vehicle.
Yu’s theory at trial was that the new valet parking policy:
(1) violated Civil Code section 5600, which prohibits a
homeowners association from imposing an assessment or
fee that exceeds the amount necessary to defray the costs
for which it is levied;
(2) violated the association’s governing documents
because the board gave insufficient notice that fees would
be imposed for parking; and
(3) was improper because no governing document
authorized the imposition of fees for providing valet
services to customers, as required by the CUP and master
covenant.
The court held a virtual bench trial, at which four
witnesses testified.
Sean Bieber, the association’s general manager, confirmed
that the association is a nonprofit organization and testified that
the association based its valet parking rates on a survey of
properties in the area. Bieber admitted that no board meeting
agenda specifically identified the imposition of fees as an item of
discussion, but fees were discussed during the meetings
themselves. He also admitted that the association incurred no
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additional costs as a result of providing valet parking to
customers.
Bieber testified that the additional revenue generated by
valet parking reduced the otherwise applicable monthly parking
assessment to homeowners who used the service.
Christopher Adoian, the president of Proper Parking, the
association’s valet service contractor, testified that no additional
valets, staff, or offsite parking spaces were needed to provide
valet service to customers of the association’s members.
Eric Bescher, the association’s president, testified, and
Bieber confirmed, that no additional costs would be incurred for
providing valet parking to customers of the Broadway
Hollywood’s tenants over those associated with providing parking
to the tenants themselves. For example, Bescher conceded,
Proper Parking did not increase its contractual fee as a result of
the decision to provide customer parking.
Yu testified that association assessments were sufficient to
cover all parking costs, including all costs relating to valet
service.
No evidence at trial indicated that member assessments
were insufficient to cover all parking-related costs.
No evidence indicated that any board meeting agenda
mentioned fees imposed for valet parking, except (arguably) the
agenda for the June 5, 2020, meeting, which mentioned “parking
rates.”
On August 12, 2021, the trial court issued a proposed
statement of decision. It concluded that Civil Code section 5600,
which limits assessments and fees an association may impose,
applied only to fees imposed on association members, not those
imposed on third parties such as the members’ customers. The
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court found that setting the amount of valet parking fees was a
matter of discretion, and no evidence established that the fees
imposed by the association were arbitrary or unreasonable.
Yu objected to the proposed statement of decision on
several grounds, but the court overruled all objections, adopted
the proposed statement as final, entered judgment in favor of the
association, and awarded it $77,300.29 in attorney fees.
DISCUSSION
Yu contends that the association’s imposition of fees for
valet parking for the members’ customers is improper for three
reasons.
A. The Parking Fee Does Not Violate Subdivision (a) of
Civil Code Section 5600
A common interest property development exists where a
separate property interest is coupled with an interest in a
common area or membership in an association.
Common interest developments are governed by the Davis-
Stirling Common Interest Development Act (Civ. Code, § 4000 et
seq.; hereafter the CID Act).
Subdivision (a) of Civil Code section 5600 of the CID Act
states that a homeowner’s association “shall levy . . . assessments
sufficient to perform its obligations under the governing
documents.”1
1 Civil Code section 5600 provides:
“(a) Except as provided in Section 5605, the association
shall levy regular and special assessments sufficient to perform
its obligations under the governing documents and this act.
“(b) An association shall not impose or collect an
assessment or fee that exceeds the amount necessary to defray
the costs for which it is levied.”
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Here, the association preliminarily argues, and the trial
court found, that section 5600 applies only to assessments levied
on association members, not fees imposed on third parties.
Under the circumstances of this case, we disagree.
Subdivision (a) of section 5600 states that an association must
levy assessments sufficient to perform its obligations under the
governing documents. In Yu v. Broadway I, we held that the
governing documents obligated the association to provide valet
parking to association members and their customers. Because
the statute concerns an association’s obligations, and one of the
obligations here relates to members’ customers, the statute
applies to that obligation.
Therefore, subdivision (a) of section 5600 imposes a duty on
the association to levy assessments sufficient to provide valet
parking to members’ customers.
Yu contends that valet parking fees charged to customers of
the association’s members violate subdivision (a) of section 5600
because, Yu argues, valet parking must be financed exclusively
by member assessments, not third party fees. We disagree.
In construing section 5600, “ ‘ “as with any statute, we
strive to ascertain and effectuate the Legislature’s intent.” ’
[Citations.] ‘Because statutory language “generally provide[s] the
most reliable indicator” of that intent [citations], we turn to the
words themselves, giving them their “usual and ordinary
meanings” and construing them in context [citation].’ [Citation.]
If the language contains no ambiguity, we presume the
Legislature meant what it said, and the plain meaning of the
statute governs.” (People v. Robles (2000) 23 Cal.4th 1106, 1111.)
Undesignated statutory references will be to the Civil Code.
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Here, the language of section 5600 contains no ambiguity.
It states only that an association must levy assessments
sufficient to perform its obligations. It does not state that
association obligations must be financed exclusively through
assessments.
This conclusion is bolstered by subdivision (b) of section
5600, which governs the imposition of an “assessment or fee,”
thereby implying than an association is permitted to impose fees
in addition to assessments to perform its obligations.
B. The Parking Fee Does Not Violate Subdivision (b) of
Civil Code Section 5600
Yu’s real contention concerns the application of subdivision
(b) of section 5600. She argues that undisputed evidence
admitted at trial showed that the imposition of valet parking fees
in this case violated subdivision (b) because they exceeded the
cost of providing valet parking. We disagree.
Subdivision (b) of section 5600 provides than an association
“shall not impose . . . an assessment or fee that exceeds the
amount necessary to defray the costs for which it is levied.”
Here, the evidence at trial established that association
members were assessed $350 per month for parking.
The evidence also established that customers were charged
a fee for valet parking.
Finally, the evidence established that valet parking for
customers resulted in no additional cost.
No direct evidence established that the $350 monthly
assessment plus parking fees exceeded the amount necessary to
defray parking costs.
Yu relies on an inference to support her conclusion that in
this case, assessments plus fees exceeded costs. First, she relies
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on her own testimony to the effect that the monthly $350 parking
assessment covered the cost of valet parking. From this fact and
the fact that fees were collected, Yu infers the assessment plus
fees exceeded the cost of valet parking.
But even if we accept this inference, it does not follow that
the parking fee policy violated subdivision (b) of section 5600 by
exceeding the amount necessary to fund parking because the
assessment, to which the fee was added, could change. No
evidence suggested it could not change, and Bieber testified that
the additional revenue generated by valet parking reduced the
otherwise applicable monthly parking assessment.
Therefore, it was possible, given the evidence, that the
calculus of parking assessment plus parking fees could change by
reducing the assessment. Yu therefore failed to establish that
the assessment plus fees exceeded parking costs.
Even if no actual reduction in the monthly parking
assessment has yet occurred, nothing prevents the association
from retroactively reducing the assessment to account for
increased parking revenues resulting from fees charged to third
parties. On the contrary, the governing documents provided that
excess funds could be retained by the association and used to
reduce the following year’s assessments.
Yu argues that the fee schedule imposed by the association
was based on no reasonable estimate about the expense of valet
parking. The point is irrelevant. It was Yu’s burden in the first
instance to show that the monthly parking assessment plus
parking fees exceeded the amount necessary to defray parking
costs. As discussed above, she failed to do so. The burden thus
never shifted to the association to justify its fee schedule as
reasonable and nonarbitrary.
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C. Notice
Yu contends the board’s decision to impose valet parking
fees violated “applicable notice requirements.” We disagree.
Section 4920 obligates a homeowners’ association to “give
notice of the time and place of a board meeting at least four days
before the meeting” and to provide an “agenda for the meeting.”
Here, evidence at trial established that the board gave at
least four days notice before its meetings and provided agendas.
Yu argues the June 2019 decision to impose fees for valet
service was improper because the agenda for the meeting at
which those fees were discussed did not specifically mention
parking fees. We disagree. The agenda stated that “proposed
changes to guest parking policy” would be discussed at the
meeting. Section 4920 requires no further specificity.
Yu argues for the first time in her reply that the
association violated the notice provision of section 4360. Because
this argument appears only in the reply, we deem it forfeited.
DISPOSITION
The judgment is affirmed. Respondent is to recover its
costs on appeal.
NOT TO BE PUBLISHED
CHANEY, J.
We concur:
ROTHSCHILD, P. J. WEINGART, J.
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