Oak Park Calabasas HOA loses big in appellate court
Fred Pilot sent this link to a published opinion from the Second District Court of Appeals (California).
Here's a summary of the Oak Park Calabasas HOA saga as I understand it:
The condo complex was damaged in the Ventura earthquake of 1994. The HOA made a (first party) claim under their State Farm property insurance policy. State Farm paid out $4.9 million that the HOA was supposed to pay to the repair contractor, ECC. But the HOA kept a "substantial portion" of the money. ECC sued the HOA for non-payment. That case went to jury trial and ECC won a judgment of about $7.5 million that the judge reduced to $7.1 million. The HOA then made another claim (a third party claim) against State Farm to pay that judgment. State Farm refused, saying the claim was not covered because the policy insured the HOA against liability to third parties caused by the HOA's negligence, but not against intentional or contractual liability. So the HOA sued State Farm. State Farm won (the HOA is now 0-2). The HOA appealed, and in the opinion linked above, State Farm won again. The HOA has to pay the judgment--there is no insurance coverage for any of it. After explaining why the loss isn't covered, the court went on to say:
Under the Stipulated and Additional Proffered Facts, it is revealed that State Farm paid Oak Park more than $4.9 million for losses under the earthquake coverage. Oak Park agreed to pay EEC with the money it received from State Farm, but following receipt of funds, Oak Park failed and refused to pay over a substantial portion of it, thereby keeping the money for itself. It appears to this court that Oak Park in essence wanted to enrich itself by forcing State Farm to pay twice for the same property loss. This court refuses to countenance such a result.
3 comments:
I became a resident of the complex after the earthquake repairs were "finished" and the ECC had filed suit. I believe the Court's assumption that the HOA intended to improperly enrich itsself was incorrect. The HOA withheld payment from ECC because it alleged ECC had improperly billed for work that was never done, (based on statements by residents). The HOA's suit against State Farm makes no sense but that's another story.
I, too, am a resident of the complex cited by "Anonymous" above and completely agree. The work was not completed on my unit but the HOA was billed for it. ECC's workers however did enter my unit and took several bottles of wine as well as jewelry. I was of the belief that the workers used by ECC were "undocumented workers."
I am also a resident of OPC. I can confirm that ECC billed for work on my condo that was simply NEVER done, not even close! The final assessment against my individual unit to pay for these bogus repairs was ~$30,000. Justice was NOT done! The HOA's attorneys should have their law licenses revoked.
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