Hartstene Pointe Maintenance Assoc, V John E Diehl

Court of Appeals of Washington·Decided June 23, 2015·No. 45739-3·Unpublished

Opinion

FILED

COURT OF APPEALS

DIVISION II

2015 JUN 23 PI 8: 31

IN THE COURT OF APPEALS OF THE STATE OF WASHI DIVISION II

HARTSTENE POINTE MAINTENANCE No. 45739 -3 -II ASSOCIATION,

Respondent,

v.

JOHN E. DIEHL, UNPUBLISHED OPINION

Appellant.

MELNICK, J. — John Diehl appeals the trial court' s orders in a declaratory judgment action.

He argues that because the trial court' s findings of fact do not support its conclusions of law, the trial court erred when it granted Hartstene Pointe Maintenance Association' s ( HPMA) request for declaratory judgment and ordered that HPMA' s governing instruments do not grant owner - members a right to appeal decisions of the HPMA Board of Directors ( Board). He also argues that

the trial court erred when it ordered that HPMA could exclude Diehl from closed executive

sessions when he acted in his capacity as an owner- member and threatened litigation against HPMA. Finally, he argues that the trial court abused its discretion when it denied Diehl' s request for declaratory judgment that HPMA' s hazard tree policy is invalid. Because the trial court' s

conclusions of law are supported by its findings of fact, we affirm.

45739 -341

FACTS

I. SUBSTANTIVE FACTS

John Diehl owns two lots within the community of Hartstene Pointe, located in Mason County. HPMA is a nonprofit corporation and the homeowner' s association for Hartstene Pointe. At all times relevant to this appeal, Diehl had dual roles as an owner -member and a Board member of HPMA. 1 The governing instruments of the HPMA are the Covenants, Conditions, and Restrictions CC &Rs) and the Rules and Regulations. Article 2 of the Rules and Regulations is entitled

Interpretation, Administration, and Enforcement of these Rules and Regulations." Clerk' s Papers

CP) at 7 ( findings of fact ( FF) 35). Article 2, § 4 provides that an owner adversely affected by a Board decision may appeal to the Board for a hearing. 2 No other provisions in the governing instruments grant an owner- member a broad right to appeal Board decisions.

In September 2011, the Board adopted an interim hazard tree policy, applicable to common areas within Hartstene Pointe. Diehl cast the lone dissenting vote. The Board subsequently adopted additional hazard tree policies, with a final policy adopted on December 15, 2012. This

policy provides that the HPMA manager shall generate a " Manager' s Notice of Proposed Action" regarding tree removal from common areas and that notice, along with an arborist' s report, shall be posted in the HPMA clubhouse and on the HPMA website for 15 days. CP at 8 ( FF 47).

1 The Board derives its authority from the governing instruments of the HPMA and is bound to carry out duties and manage HPMA pursuant to the governing instruments. Ch. 64. 38 RCW; Ch. 24. 03 RCW.

2 CC &R article 9 is titled " Interpretation, Administration, and Enforcement of Covenants." CP at 6 ( FF 30). Article 9, § 3 allows any owner to complain of an actual or threatened violation of the CC &Rs to the Board and demand that HPMA prevent or abate the violation.

45739 -3 - II

The policy provides " considerable specificity" regarding the manager' s directives and duties, and the manager may consult with the Board with questions arising under the policy. CP at 8 ( FF 51). No manager " felt confused or inadequately guided" by the policy. CP at 8 ( FF 52). The " non- imminent hazard" section of the policy allows owner- members to " submit [to the Board] any written comments, objections, related information, or written alternative proposal" that the owner chooses. CP at 8 ( FF 49). Additionally, under this section of the policy, an owner- member may file a written notice of intent that the owner is retaining an independent, professionally qualified arborist" to prepare a second opinion. CP at 8 ( FF 48).

Diehl sought to appeal to the Board its decision to adopt the September 2011 policy. As

an owner- member, he claimed a right to appeal under CC &R article 9 and Rules and Regulations

article 2. The Board president reviewed the governing instruments, discussed the issue with other Board members and legal counsel, and believed that Diehl had no right to appeal. The president

drafted a summary of his meeting with legal counsel and forwarded it to all Board members except Diehl. The president believed Diehl and the Board held adversarial positions.

In October 2011, the Board met and asked Diehl to recuse himself from the portion of a

closed executive session meeting during which the Board planned to discuss Diehl' s request for an appeal. Diehl did not recuse himself and the Board did not discuss the issue. II. PROCEDURAL HISTORY

In November 2011, HPMA filed a declaratory judgment action in Mason County Superior Court to determine whether the governing instruments vested a right to appeal the Board' s adoption of the hazard tree policy or other management and policy decisions; whether HPMA may convene in closed executive session to consider legal communications, consult with legal counsel, and discuss likely or pending litigation threated by Diehl against HPMA; and whether Diehl is 45739 -3 - II

required to recuse himself from such closed executive sessions. Diehl filed numerous

counterclaims against HPMA, including that the hazard tree policy was invalid.

Diehl filed a motion for summary judgment, which the trial court granted in part by invalidating the hazard tree policy adopted in September 2011. The trial court denied the

remainder of Diehl' s motions for summary judgment. Diehl filed amended counterclaims

challenging the revised hazard tree policies, including the final policy adopted on December 15, 2012. The matter proceeded to trial.

Following a five day bench trial, the trial court entered findings of fact and conclusions of law. It concluded that article 2, § 4 relates to the interpretation, administration, and enforcement

of the Rules and Regulations and no reasonable reading would permit an owner to appeal a policy the Board validly adopted. The trial court concluded that the governing instruments as a whole do not vest an owner ... with any right to appeal to the Board the Board' s adoption of the interim hazard tree policy or similar Board decisions. "3 CP at 11( conclusions of law (CL) 6).

Additionally, the trial court concluded that during the times at issue, Diehl was acting in

4

his capacity as an owner -member and was likely to initiate litigation against HPMA. And,

pursuant to former RCW 64. 38. 035( 2) ( 1995), HPMA had the authority to convene in closed executive session to consult with legal counsel and discuss likely or pending litigation.

3 The trial court also concluded that no reasonable reading of CC &R article 9 would permit an owner to appeal a policy validly adopted by the Board.

4 In 2013, the legislature amended RCW 64. 38. 035. RCW 64. 38. 035( 2) became ( 4) but remained substantively consistent. LAWS OF 2013 ch. 108, § 1.

45739 -3 -II

The trial court concluded that the hazard tree policy adopted on December 15, 2012 was not invalid or defective in any manner relating to the delegation of duties to the manager and did not grant unreasonable discretion or overly broad powers to the manager. The trial court also

concluded that the posting requirement constitutes reasonable notice, and the hazard tree policy was not unreasonably vague or biased. Finally, the trial court concluded that the "[ n] on- imminent

hazard" section of the policy was broad enough to enable owner input and did not limit an owner to any source of additional information. CP at 12 ( CL 15).

The trial court granted HPMA' s request for declaratory judgment that its governing instruments did not grant owner -members a right to appeal Board policy decisions and that the Board is and was authorized to convene in closed executive session excluding Diehl. The trial

court denied Diehl' s request for declaratory judgment that the hazard tree policy was invalid. Diehl appeals.

ANALYSIS

I. STANDARD OF REVIEW

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