Real Estate & Property Law

Small Claims Court - What Can One Accomplish There?

A reader recently sent this question:

"What legal scope would you see small claims handling with HOA laws. I read they would defend new election laws ensuring secret ballot. Would you think any subject that is clearly defined in the Civil Code? Special Assessment maxes, monthly assessmet increase? This is one of the few the Governor signed!"

The Small Claims courts are unpredictable but I believe they for the most part try to follow the law. One is asked, when appearing there, if you will forego a judge and settle for a referee. Most do that. The referees are not as experienced as judges, but they for the most part try to find the right solution under the law and equities.

That said, I have heard all sorts of things about elections challenges working, going bad, and being pulled up to Superior Court by the defendant Associations. I think a lot probably depends on what is at stake. If someone takes a challenge to small claims court and asks for a viewing of ballots and recount, it seems likely that the referee or judge would tell the parties to arrange it. The official probably will not make an official order to that effect, because that would be considered an injunction and small claims court referees and judges are not authorized to give injunctive orders (telling someone to stop doing things or start doing things). They can accomplish much the same thing, however, by telling one party or the other to do something or stop doing something under a threat of granting damages (a monetary award) if they do/do not listen. A small claims court judge/referee can tell the parties to go out in the hall and talk and try to resolve the matter. They can tell the parties they are going to continue the matter, call them back in 30 days, and see if the problem is resolved. In other words, they can put pressure on the parties to fix the problem.

If someone goes there and asks for a new election, I do not believe there is much predictability in what the judge/referee will say. If there are blatant errors, there could be fines imposed, and so the judge/referee could make threats about that if the election was not rescheduled. If the defendant HOA does not like the outcome/judgment, it can appeal and the matter is heard all over again in a courtroom, with a judge. If the owner does not like the outcome, he or she is out-a-luck. That was the one shot.

If an HOA passes an assessment that is illegal, meaning in violation of a law, then the court officer can grant a judgment to the owner who challenged it for whatever the judge or referee feels was that owner's share of the "illegal" assessment but he or she cannot order the HOA to pay everyone else back. Those people would have to come in on their own. I could imagine, again, however, a judge or referee continuing a hearing - telling the HOA to fix the problem, or suffer the consequences. I have actually seen some real theatrics and unbelievable things happen between the small claims referees and appellate judges and so I cannot say the forum is predictable at all.

However, the California legislature has seen fit to offer it up as a remedy in more and more cases and statutes relating to HOA issues, simply to try and provide a forum that does not cost an owner with a beef against his or her HOA an arm and a leg to get a reasonable resolution of a nagging problem. One can always try it. Just be advised that a decision against the plaintiff (party bringing the action) is the final word on the subject, even if you do not like it. The idea is that the forum is provided as cheap and quick way to address problems, cost effective because attorney representattion is not allowed at the small claims hearing level (although I have seen that violated by attorneys appearing as so-called girlfriends or boyfriend witnesses), and thus, the claimant must not be allowed to "try it on", and then go to plan B if plan A failed.

Full post as published by California Condo & HOA Law on November 23, 2008 (boomark / email).