In April of 2008, Jeffrey Needelman (“Tenant”) entered into a lease agreement with DeWolf Realty Co., Inc. (“Landlord”) for an apartment in San Francisco.  After the lease expired, Tenant continued on as a month-to-month tenant.  In December of 2011, Landlord served a three-day notice on Needleman alleging that Needleman violated terms of the lease by harassing other tenants in the complex.  In January of 2012, Tenant filed an answer to the complaint.  In March of 2012, the parties entered into a settlement agreement that included the right to pursue a stipulated judgment with 24-hours notice, that Tenant was required to comply with the terms of the lease, that Tenant waived any claims he had, and that Tenant agreed that any property left in the unit would be deemed abandoned.

In May of 2012, Landlord notified Tenant that it was moving ex parte to enter a stipulated judgment for possession against him for violating the settlement agreement.  Tenant failed to appear at the hearing and the court granted Landlord’s request for the stipulated judgment.  Eventually, Tenant was locked out of his property.  In an attempt to stop the eviction, Tenant moved to set aside the judgment.  In July of 2012, the trial court denied Tenant’s motion stating that the agreement reached by the party was clear and there was sufficient evidence presented by Landlord to enter judgment against Tenant.  Tenant then appealed the judgment to the appellate division of the superior court.  In March of 2013, the appellate division of the superior court affirmed the trial court’s decision.

Not done with the judicial system, in May of 2013, Tenant filed a lawsuit against Landlord with claims largely based on issues that were raised during the unlawful detainer proceeding.  After several motions, the court eventually dismissed Tenant’s case finding that his claims were barred by res judicata and the settlement agreement.  Tenant then appealed the case to the appellate court.  On appeal, Tenant argued that his claims were not barred by the judgment and the settlement agreement because the settlement agreement violated constitutional protections.  Tenant contended that the 24-hour notice was insufficient as he had other obligations and could not attend the hearing.


The First Appellate District affirmed the trial court’s decision and found that Tenant’s claims were barred on multiple different grounds.  The Court held that although there are heightened standards for res judicata in unlawful detainer cases than other cases, the heightened standards did not apply when the parties had an opportunity to litigate the matter.  Here, the Court found that although no trial ever occurred, the mere fact that Tenant filed an answer and chose to settle the matter was sufficient to trigger res judicata of the claims.  Additionally, the Court rejected held that the 24-hour notice was agreed to by the parties and Tenant chose not to attend the hearing.  Because Tenant made a choice not to appear, his due process rights were not violated.


Here, the Court upheld many of the terms routinely included in most settlement agreements including the shortened notice provision and waiver of claims.  A contrary decision would have made settlement almost impossible for most civil cases, especially in the unlawful detainer context.


None of the holdings in this case were particularly surprising.  Here, the Court essentially affirmed that the terms most parties use in their agreements are constitutional.  However, if the Court had decided otherwise, it is unclear how parties could reach a settlement agreement in the future.


Short term rentals are becoming big business, and California and the Bay Area are no exception.  Companies such as Airbnb and VRBO have grown to become massive entities and have drawn a great deal of attention.  So much so that San Francisco recently had a proposal on the ballot to limit the number of days Airbnb rentals are allowed.

The question thus becomes:  is Airbnb for you?  In order to make this decision, there are several variables to consider.

Are you allowed to?

First consideration: Are you even allowed to rent your unit on a short term basis?

The answer to this question is dependent on your housing situation.  If you are in a condominium or townhouse, you must look to the CC&Rs.  Many homeowner associations have rental restrictions.  The recent rise of Airbnb has caused associations that do not have restrictions to add them.  If your association restricts them, violations could result in penalties and liens on your home.

If you are a tenant, you must look to your lease.  Most leases have restrictions on sub-tenants or guests.  If you violate these restrictions, you could be evicted.

Even if you own a single family residence (or condominium or townhouse that does not have restrictions), you must ensure the city or county in which you reside does not have its own restrictions or cumbersome taxes or penalties.  Thus, reviewing the municipal code is required.

For example, San Francisco has specific limitations on short term rentals.  A homeowner cannot rent their entire unit for more than 90 days a year, and have to live in the unit the rest of the year.  These restrictions do not currently apply if you only rent a portion of the unit.  There are several other restrictions that are too lengthy to cover in this blog, such as record-keeping requirements, taxes, and registration.

Just this week, a ballot measure to further restrict short-term rentals was defeated.  This measure would have limited rentals to 75 days a year, whether or not they were for the entire property or just a portion thereof (among other restrictions).  Although this measure failed, it is anticipated that further efforts to control short-term rentals in San Francisco, and throughout the state, will continue.

Are you Insured?

If you determine there are no restrictions in place for renting your unit, you next need to ensure you are insured.  Typical homeowner policies do not provide coverage for rentals.  Thus, if the tenant damages the property or sues you, you will not have insurance coverage to fall back on.  Yes, the hosting site may have some sort of coverage, but it would be unwise to depend on them.  These policies typically are rife with exclusions and requirements, making it impossible to ensure any coverage.

What are the tax consequences?

Our firm does not provide tax advice, however we are sure to alert our clients of the potential issue so they may consult the appropriate tax professional.  Renting out your unit may come with tax consequences, so it is important for the owner to understand these consequences.


These are some of key issues to consider if you are intending to rent your home out on a short-term basis.  We will be conducting a webinar on Tuesday, December 1st at 10 AM.  This webinar will go into more detail on these issues and provide real-life illustrations.  Please visit this site for more information on this webinar and to sign up.


Some Californians believe that California does not exhibit autumn colors. That is because most of the population lives near a coast, where Mediterranean plants dominate the terrain. However, California boasts some of the most beautiful autumn sceneries in the country. The changing colors of leaves means that piles of leaves on the ground are soon to follow, so here are some real estate law considerations about leaves that you should know:

Leaves & Flooding

After Hurricane Patricia made landfall in Mexico as the strongest Pacific hurricane in history, the predictions about a torrential El Niño intensified. Storm drains and rain gutters that get clogged by leaves is one of the most common sources of flooding and property damage. In dry conditions, fallen leaves and debris will slip into gutters without commotion. But when a torrential downpour occurs, the accumulation of leaves can create a blockage of gutters and result in flooding. Leaves that are not regularly gathered and maintained can cause unnecessary storm drain blockage, so make sure that rain gutters and storm drains on your property are cleared of debris.

Encroaching Tree Dumping Leaves

If the leaves are falling from a branch that is hanging over your yard, you can trim the offending tree branches back, all the way up to your property line. However, your tree trimming cannot affect the structural integrity or cosmetic appeal of a tree, and cannot extend on to your neighbor’s property. Talk with your neighbor before attempting to trim trees on your neighbor’s property.

Boundary Trees & Storm Damage

The responsibility for fallen leaves and for storm damage from a tree can be dependent on whether or not there is shared responsibility for the tree. If the tree trunk is wholly in neighbor’s yard, it belongs to the neighbor, and they are responsible for the tree. However, branches and leaves from a boundary tree — or a tree that is on the property line — are the responsibility of all owners. If a neighbor’s tree falls during a storm and causes damage, they may be responsible for the damages. If the neighbor took reasonable care to maintain the tree branches and the branches didn’t pose a reasonable threat of falling, then the “Act of God” principle potentially admonishes them from liability. However, if the neighbor demonstrated negligence by not providing reasonable care and maintenance, then they could potentially be held liable for damages caused by a storm.

HOA & Lease

The Covenants, Conditions, & Restrictions (CCRs) for your Home Owner’s Association (HOA) may contain specific provisions about landscape upkeep, including responsibility for fallen leaves. For renters, your lease may contain information about whether the landlord or the tenant is responsible for yard and tree maintenance. Read your CCRs or your lease for more information about leaves & debris from trees.


In 2001, John Carr (“Carr”) claimed adverse possession of a vacant lot (the “Property”) in Riverside. The owner of record was a decedent’s estate in probate. In 2003, a judgment was recorded transferring from the estate one half of the Property to Ernest Ortiz (“Ortiz”) and the other half to Anna Colón (“Colón”). In March 2004, Colón executed a deed conveying her half of the lot to Michael Lopez (“Lopez”). However, the deed to Lopez was not recorded until two years later, in October 2006.

In May 2006, Carr filed a quiet title action against Ortiz and Colón (but not against Lopez, as Lopez’s deed had not yet been recorded).  A few days after filing the lawsuit, Carr recorded a lis pendens against the lot. The lis pendens was not mailed to anybody. Instead, Carr’s attorney attached his own declaration to the effect that Ortiz and Colón had no known address.  However, as of the date of recordation of the lis pendens, the latest county assessment roll listed Ortiz and Colón as the owners, with a “care of” address for an attorney in Oceanside.

In August 2007, Lopez executed a deed of trust on the lot in favor of Rondo Resources (“Rondo”), a mortgagor, who recorded the deed two months later. In December 2007, a trial court entered judgment on the adverse possession lawsuit, quieting title to the lot in favor of Carr as against Ortiz, Colón, and purportedly Lopez. However Lopez had never been made a party to the prior action.

In 2011, Carr filed a second complaint to quiet title against Lopez and Rondo over Colón’s former half of the Property. Lopez and Rondo both argued that under CCP §405.22 and CCP §405.23 the lis pendens was void because it was not mailed to Colón’s address, as shown on the assessor’s roll. Carr argued that he did not have to mail the lis pendens to the address on the assessor’s roll because that address was not valid and the lis pendens would not actually have reached Colón. The trial court ruled against Carr in favor of all defendants, finding that Plaintiff Carr’s quiet title judgment does not bind Lopez because the lis pendens was void.


The Court of Appeal affirmed the lower court’s decision that the lis pendens was required to be mailed to the owner’s address as shown on the tax assessor’s roll, regardless of whether that address was actually valid. The Court determined that where this was not done, the lis pendens was void, not only as against one owner but also as to the owner’s transferees.


The opinion expressly states what actions a claimant must take to provide valid notice of a lis pendens to a property owner. Defective notice of a lis pendens can be fatal to a claimant’s rights and the opinion clarifies the mailing requirements after recordation of a lis pendens.


Interestingly, the Court particularly clarified the distinction between a “known” and “unknown” address. The Court stated that CCP §405.22 and CCP §405.23 favor the claimant because all the claimant has to do is mail the lis pendens to the address shown on the assessor’s roll; the claimant does not have to make the sure the address is valid. “If a properly addressed lis pendens is returned as undeliverable, that is not the claimant’s problem.”  It is immaterial under the statute that the owner’s address listed with the assessor is incorrect. Once the claimant does check the assessment roll, the owners’ addresses become “known”. If the address is unlisted in the assessment roll because it is unknown to the assessor, then and only then may the claimant satisfy its obligation to mail the lis pendens to that owner by submitting a declaration that the owner has no known address.


Carr v. Rosien 238 Cal App. 4th 845


The case of Monterossa v. Superior Court of Sacramento County (real party in interest, PNC Bank) is the first case to definitively answer a question many litigators have had ever since the Homeowner’s Bill of Rights went into effect.

California’s Homeowner Bill of Rights (the “HBOR”) went into effect on January 1, 2013.  The HBOR was a legislative package and contained two bills, S.B. 900 and A.B. 278, which amended and added to California’s Civil Code sections governing nonjudicial foreclosure sales.

According to California’s Office of the Attorney General, the HBOR was intended to accomplish these stated objectives:

(1) bar dual tracking of foreclosure sales;

(2) mandate a single point of contact;

(3) give borrowers legal relief; and

(4) mandate verification of documents.

The law, formally titled the California Foreclosure Reduction Act, originally sought to overhaul the non-judicial foreclosure process. HBOR also provided stronger legal remedies to borrowers, giving them a private right of action to seek an injunction for lender violations of HBOR and entitling them to attorney’s fees.

Like all new laws, there were some ambiguities in HBOR, and one of the unknown questions was whether a borrower could recover their attorney’s fees early in the case, such as after obtaining the preliminary injunction. We wrote about that previously, stating: “Accordingly, the HBOR’s broad wording is unclear whether litigants would be entitled to seek attorneys’ fees immediately after being awarded a TRO and before issuance of the preliminary injunction. This creates a powerful leverage for borrower’s counsel, who can seek to bring the lender to the table to settle a case early.”

Two years later, the appellate court has provided an answer, finding that a borrower who successfully obtains a preliminary injunction is a “prevailing party…in an action” since the statute clearly intends to provide injunctive relief as its remedy.

Mr. Monterossa and co-petitioner Cheranne Nobis were borrowers under a loan of $359,650 from PNC Mortgage, a division of PNC Bank, N.A. (PNC), and purchased their home in 2005. As succinctly explained in the decision, “In June 2013, petitioners were unable to make their mortgage payments. PNC twice wrote to petitioners in August, asking them to call PNC for help with foreclosure prevention alternatives, and telling them that PNC wanted to help them retain their home. Petitioners repeatedly called PNC to request a “hardship assistance package,” but PNC failed to send them one. Despite PNC’s failure to send petitioners a hardship assistance package, PNC notified petitioners that their request for hardship was denied because PNC did not receive a completed hardship assistance package from petitioners. Thereafter, PNC recorded a notice of default with Quality Loan Service Corporation. In November 2013, petitioners submitted a loan modification agreement to PNC, and PNC “appointed a single point of contact” named Hazel, who informed petitioners they needed to submit missing documents. On December 5, 2013, petitioners submitted the missing documents, and Hazel confirmed PNC had received a complete package. On January 24, 2014, PNC recorded a notice of trustee’s sale on the property. Petitioners immediately called PNC, and were told that their loan modification was denied due to missing documents.”

Monterossa and Nobis filed an ex parte application for a temporary restraining order (TRO) to halt the foreclosure sale, which the court granted.  Then after the hearing on the Order to Show Cause why a preliminary injunction should not issue, the Court granted the preliminary injunction as well.  Then, borrowers sought their attorney’s fees as prevailing party under the new statute section 2924.12, subdivision (i).  The trial court denied borrowers’ motion, concluding a preliminary injunction was an “interim award” for provisional relief and therefore not eligible yet for attorneys’ fees.  Borrower’s filed a Writ of Mandate, and this opinion followed.


The Appellate Court reversed, analyzing the relevant HBOR provisions, legislative history and concluding that HBOR was a unique statutory scheme.  The most the borrower could “win” under HBOR was the injunction, which is what happened here.  The Monterossa Court clearly explained that HBOR enforced the prohibition against lender dual tracking by providing one of two remedies: 1) either an injunction to halt the non-judicial foreclosure sale, or 2) if the trustee’s sale had already occurred, the borrower would be entitled to actual economic damages.


In a situation where the borrower is facing the loss of their residence, courts will very reasonably conclude that irreparable harm would result from a foreclosure sale.  That means that if the borrower can show a de facto violation of HOBR (failure to comply with any number of technical requirements), that may be enough to obtain a preliminary injunction.  Accordingly, lenders will be facing the prospect of an attorney fee award very early in the dispute.

This decision acknowledges that this statute is unique, presents a unique remedy and is contrary to the general litigation principle that a party is only eligible for their attorney fee award after they win the entire litigation as opposed to the interim award allowed here.


This case still does not expressly address whether the TRO is injunctive relief sufficient to request attorney’s fees.  Therefore, in a situation where the borrower obtains the TRO, but is denied a preliminary injunction, could they obtain attorney’s fees for the TRO? This decision speaks only of preliminary injunctions and so a lender’s counsel may conclude that since the statute does not expressly authorize it and the sole case in point does not address it that indeed, a TRO is not injunctive relief sufficient to trigger the attorney’s fee provision of 2924.12 (i).

Monterossa v. Superior Court, 237 Cal. App. 4th 747 (June 12, 2015)


Post image for HOA Obtains Injunction Requiring Floor Covering

HOA Obtains Injunction Requiring Floor Covering

Simon Offord

by Simon Offord on August 20, 2015

in HOA Litigation

The recent case of Ryland Mews v. Munoz dealt with an increasingly common issue in homeowners associations – the installation of hard surface flooring.

Ryland Mews (“the HOA”) sued Munoz (“Homeowner”) in response to Homeowner’s installation of hardwood floors in his unit.

Specifically, Homeowner replaced the carpets in his unit with hardwood floors to accommodate his wife’s severe dust allergy. After the installation, the downstairs neighbors began to experience “sound transfer” through the floor.  They never had any such issue before the hardwood was installed and claimed the noise became “greatly amplified” and “intolerable,” so that that the downstairs neighbors found it difficult to relax, read a book, watch television, or sleep.

The HOA thereafter sued, seeking an injunction and declaratory relief.  The HOA alleged that Homeowner had violated the CC&Rs. The HOA soon after applied for a preliminary injunction, “restraining and enjoining” Homeowner from “[m]aintaining hardwood flooring” and from violating other HOA restrictions.

Homeowner opposed the motion, contending that hardwood floors were necessary in his home because his wife was severely allergic to dust; consequently, removing the floors and installing new floors not only would be expensive but would endanger his wife’s health. Homeowner found the likelihood of plaintiff’s success on the merits to be “questionable” and maintained that no irreparable harm had been shown.

The court agreed with the HOA that the HOA was not demanding that Homeowners “tear up the floors,” but sought only a “proposal through a contractor” for a modification consistent with the HOA rules. The HOA added a request for an interim solution, that throw rugs be placed on 80 percent of the floors outside the kitchen and bath areas. The court found those suggestions reasonable and granted the request.

Homeowner disagreed with the Trial Court’s decision, contending that the court improperly balanced the prospective harm to each party and erroneously concluded that the HOA would prevail at trial. Homeowner appealed.


The Appellate Court affirmed the Trial Court decision.  Specifically, the Appellate Court saw no abuse of discretion in such an order. The Appellate Court held the directive to find a compromise in modifying the flooring, as well as the interim remedy of using throw rugs, reflected a balanced consideration of the circumstances of everyone involved, including the residents below who were adversely affected by Homeowner’s violation of the noise and nuisance restrictions.

The finding that Homeowner’s violation of the HOA rules had resulted in a continuing “great nuisance” for the occupants below was supported by substantial evidence. The evidence clearly supported the court’s weighing of the relative interim harm to the parties and its implied determination that the HOA would ultimately prevail on the merits.


This decision gives homeowner’s associations more confidence and another “sword” to curb violations of CC&Rs, notably seeking an injunction.  This specific issue, installing hard floor surfacing contrary to HOA guidelines, is incredibly common.  This decision will surely lead to aggrieved homeowners or the associations themselves seeking injunctions immediately, rather than waiting for trial to remedy the noise issues.


This was a welcome decision.  The Trial Court avoided making an order that was overly burdensome and required the floors to be removed, or deciding that any order was premature.  Instead, the Court fashioned a very reasonable and balanced injunction that still allowed Homeowner his day in court, but also addressed the HOA’s and the downstairs neighbor’s concerns.  It is encouraging to see judges looking at the bigger picture and making well thought-out decisions the truly strike a fair balance.

Ryland Mews v. Munoz (2015) 234 Cal. App. 4th 705

{ 1 comment }

Post image for 5 Things to Consider Before Building a Pool

5 Things to Consider Before Building a Pool

Simon Offord

by Simon Offord on July 31, 2015

in Real Estate Law

As the heat of the summer continues across California, and temperatures start to creep into the triple digits, having a pool around sounds like a pretty swell option. In the privacy of your own property, you can take a dip to cool off from the sweltering heat, or lay out next to the pool and catch some rays. For those who are considering installing an in-ground pool on your property, however, there are some important real estate law-related things that you should keep in mind.

Here are 5 law-related things you should consider before installing a pool on your property:

 1. What do the local municipal codes and state requirements say?

Municipal Codes may have very specific requirements about constructing a pool, size, type, set-back requirements, etc.  Make sure your contractor understands with and complies with these rules.

2. Safety issues

Pools can be hazardous to children and adults alike.  Is a fence around the pool necessary or required by the local laws?  Does your insurance cover injuries that may occur in or around the pool?  Be sure you have reviewed and considered these issues before proceeding.

3. HOA Restrictions

Does your homeowner’s association have any specific rules regarding pools?  Are they even permitted?  If so, are there size or other restrictions/limitations?  Even if the City allows the pool, the last thing you need is a dispute with the HOA about the pool.

4. Easements and Space Restrictions

Do you have sufficient space to install a pool?  Are there any utility or other easements in your yard that prevent you from having a pool?  Are trees in the vicinity and will the pool impact (or be impacted by) tree roots?  A surveyor or arborist may be needed to analyze this issues for you, so do so early in the process.

5. Tax Implications

Will adding a pool constitute new construction that will impact your property taxes?  How much value does the pool add and how much higher may your taxes become?


Trespasser’s Injury Must be Greatly Disproportionate To the Owner’s Injury to Obtain Equitable Easement

by Simon Offord July 24, 2015 Easements
Thumbnail image for Trespasser’s Injury Must be Greatly Disproportionate To the Owner’s Injury to Obtain Equitable Easement

The recent case of Shoen v. Zacarias further analyzed the equitable easement concept and what is required by a trespasser to obtain one. In Shoen, the Zacariases (hereinafter “Trespassers”) were innocently trespassing on a patch of land owned by the Shoens (hereinafter “Owners”).  The patch of land was about 500 square feet and included the […]

Read the full article →

Court Holds Debt Collectors Liable for Attempting to Collect Unenforceable Debts

by Henry Chuang July 22, 2015 Collection Disputes
Thumbnail image for Court Holds Debt Collectors Liable for Attempting to Collect Unenforceable Debts

In 2005, Afsheen and Fabiola Alborzian (“Alborzians”) obtained two loans to purchase a residential property.  The first lienholder was Wells Fargo and the second lienholder was JPMorgan Chase Bank (“Chase”).  Eventually, after the Alborzians defaulted on their loans, Well Fargo foreclosed.  A year after the foreclosure, Chase sent a letter to the Alborzians attempting to […]

Read the full article →

The Watcher – A Reminder that Disclosure Duties Go Beyond Physical Defects

by Simon Offord June 29, 2015 Disclosure
Thumbnail image for The Watcher – A Reminder that Disclosure Duties Go Beyond Physical Defects

We have written several articles about a seller’s duty to disclose, including articles about the consequences of failure to disclose material facts. Most of these articles discuss physical defects, as these are the issues that most often result in lawsuits. However, a seller’s duty does not end there. ANY fact materially impacting the value of […]

Read the full article →